Yahoo Finance

And on -- at least on the paid member front, we're also probably benefiting from that attractive entry point in terms of price point and feature set for our ads plan. So, you put all that together and it was a nice quarter for subscriber growth, but even more importantly, a nice quarter in terms of driving healthy revenue growth and healthy profit growth, so 17% reported revenue growth and margins that were up 5 percentage points year over year.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thanks, Spence. Doug also has a follow-up question on the results. We noted -- or Netflix noted that India was our No. 2 and No.

3 country in terms of paid net ads and percent revenue growth in the second quarter. Do you feel like you're hitting more of an inflection point in that market? Or is that more about a very specific, successful content slate in Q2?

Spencer Adam Neumann -- Chief Financial Officer

Do you want to take it or --

Theodore A. Sarandos -- Co-Chief Executive Officer

Yeah. Well, look, I think India's growth is a story that we see around the world playing out very similarly. So, you look at the content, the product market fit is what drives our ability to attract members and retain members and monetize with them as well. So, I feel like what's going on in the quarter has been this ongoing build.

We had this great show, "Heeramandi." Sanjay Leela Bhansali, SLB, is one of the most celebrated filmmakers in India, and he took on this incredibly ambitious series and brought it to the screen on Netflix, directed every episode, and it's our biggest drama series to date in India. So, on top of that, our original films and our licensed films, those films in the pay TV window, they're immediately following theatrical, continue to thrill our members. So, we pick them well, we program well, we improve the product market fit. We improve engagement, we grow our members, we grow our revenue.

It's the same formula, I think, everywhere else everywhere we go. And there's certainly plenty of room to grow in India as long as we keep thrilling our audiences there.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you. Ted. Our next question on the results relate to operating margin. And the question comes from Jessica Reif Ehrlich of Bank of America.

For Spence, how should we think about the pace of margin expansion going forward and the drivers of the margin outperformance this year.

Spencer Adam Neumann -- Chief Financial Officer

Thanks, Jessica. Well, you know, when we think about margin expansion, we're obviously pleased with how it's trending so far. You know, our focus -- kind of stepping back, our focus is to sustain healthy revenue growth and grow margins each year. You know, so we feel good about what we've been delivering.

As you see in the letter, we're now targeting 26% full year operating income margin. That's up from our prior guide of 25%, and it's up 5 percentage points year over year, assuming we kind of land there. But the amount of annual margin expansion, as we look forward, it could bounce around each year. We've talked about this -- in recent quarters.

It could bounce around because of foreign exchange in a year where that moves or other business considerations. But we're committed to grow margins each year. And we see a lot of room to continue to grow profit margin, absolute profit dollars, and do that over an extended period of time for years to come.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Spence. Our next question comes from Steven Cahall from Wells Fargo, and it's regarding free cashflow. So, the question is, "Netflix has raised their full year revenue and margin outlook but did not change their free cash flow forecast of approximately $6 billion. Is this just a pull-forward in cash content spend, or is there anything else that is impacting your free cash flow guidance?"

Spencer Adam Neumann -- Chief Financial Officer

I'll tell you, though, nothing else impacting it. We -- you know, as we noted, as you noted, we continue to expect approximately 6 billion of free cashflow for the year. There's always some uncertainty in terms of timing of things like content spend, sometimes timing of taxes. So, that kind of keeps us right now holding at approximately 6 billion.

But no other read through beyond that.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Spence. We have our quarterly question on page sharing next from John Hodulik of UBS, which I'll direct to Greg. The question is, "Do you still have upside from the paid sharing initiative? And have you moved forward on mobile paid sharing? And if so, how big of an opportunity is this?"

Gregory K. Peters -- Co-Chief Executive Officer

Yeah, Spence already gave some commentary on this quarter's performance. I'll talk about it sort of more from a long-term perspective. As we said for a couple quarters now, we're at the point where we really operationalize paid sharing. So, it's just a standard part of our product experience.

And we think about the improvements there. And to be clear, we do see still some significant areas for improvement there. But we see those as part of all the opportunities essentially we have to improve the product experience. So, we're constantly prioritizing all those opportunities based on what we think is the expected value.

And just to give you a sense of, you know, how wide that is, even things that we've been working on for over a decade, like our signup flows or the user experience that a consumer has when they want to sign up for Netflix, we have found multiple improvements just over the last couple of quarters in those flows, which have delivered material incremental revenue wins. So, we're going to continue to look at all these opportunities. We're going to improve things for members and for the business. We'll iterate, we'll improve them.

And we think of this as just a constantly improving value translation mechanism. So, we want to take all the value that's created by Bella's teams in film and series. We've got more live events, games. And we want to translate that more effectively into revenue so we can continue to invest and keep that flywheel spinning.

And if we can keep improving that value translation mechanism each quarter and keep improving the entertainment offering that it operates on top of, those two things compound and drive the business. It'll drive the business to the rest of the year. It'll drive through '25 and beyond. And that really allows us to more effectively get more of those 500 million-plus and growing smart TV households around the world that aren't currently members to sign up.

And it also drives our other levers of growth, like plan optimization, extra member, ads, revenues, and pricing into more value. So, I just -- I think about this as more of the, you know, constant work we are doing to improve for decades to come.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Greg. I'll now move us along to a series of questions about advertising. And we'll start first with Barton Crockett of Rosenblatt, and I'll point this question to Spence. You say that advertising is not a "primary" driver revenue growth yet.

Can you provide a little more clarity on what that means for both '24 and '25?

Spencer Adam Neumann -- Chief Financial Officer

Yeah, sure, thanks. So, stepping back, I'd say we're very pleased with how we're scaling our ads business. We talk about that in our letter. We've been primarily focused on scaling reach.

But if you think about even just the revenue portion of ads, it is growing nicely. The rate of growth, it just happens to be growing off of a relatively small base because we're starting from only 18 months into ads. So, to have the kind of a primary revenue impact across a business that has been primarily subscription for a long time, that just takes some time. So, we're scaling well through reach, through engagement, through growing inventory.

And that represents opportunity for us over a multi-year trajectory to have a big and increasing revenue and profit impact on the business. So, again, stepping back, we feel really good about our position, our ability to sustain healthy revenue and profit growth. Ads is kind of one more tool in our tool chest there. We're doing the hard work now to improve our service across the board.

So, we finished the year strong in '24 and drive growth into '25 and beyond. We're small in every measure. We talk about it a lot. We're small share in TV time.

We're small in terms of penetration of connected TV homes. We're small in revenue market share. And we're going to grow in those areas across the board, and ads is going to be a bigger piece of that puzzle. Just we won't have it be primary in '24 or '25, but it contributes.

It's a meaningful contributor. That's what we've said, and that's what it is doing. And then when you get into '26 and beyond, it can be even more meaningful and, hopefully, it becomes to the point where it is a primary contributor, given all of that engagement and reach that we're building.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Spence. A follow-up question on advertising comes from Ben Swinburne of Morgan Stanley and I will direct this to Greg. Looking into your advertising revenue ramp into 2025, what are the key areas that need to improve to bring in significantly more revenue? Can you talk about the opportunities and challenges scaling up your direct sales efforts and leveraging third-party sources of demand, primarily programmatically?

Gregory K. Peters -- Co-Chief Executive Officer

Yeah, we've said many times, our priority, No. 1 priority, first priority is scale. So, we've been heavily focused on that. And the great news is we've seen great progress in that regard.

We've been scaling our ads member base very quickly from zero two years ago to where we are today. And we're excited to say that we're on track to achieve our critical scale goals for all of our ads countries in 2025. Clearly, we expect further growth beyond that, but that represents a great threshold to get to and then to build more scale and more attractiveness from there. So, that allows us to shift more of our energy now on more effectively monetizing that rapidly growing inventory.

And there's sort of two main fronts here. One is our go-to-market capabilities. So, we're adding more sales folks, we're adding more ads operation folks, building our capabilities to meet advertisers. A big component of that is giving advertisers more effective ways to buy Netflix.

It's a big point of feedback that we heard from advertisers. So, by adding demand sources that are already integrated into their processes and their systems, that just makes it easy for them to buy. And in some cases, that was a threshold item for them to buy in us, so we're going to expand the number of buyers as a result of that. And then, the other big area of growth for us is the sort of product and technology stack.

We mentioned we're building our own ad server now. We're excited to launch that in Canada this year and then the rest of our ads markets in '25. That unlocks a whole set of innovations that we expect that are focused on a better user experience for our members on those ad tiers and better advertiser features. So, think a lot about this as targeting relevance, more capabilities in that space, as well as thinking about, you know, how do we do ROI, ROAS, incrementality measurements, all the things that we want.

And ultimately, really, this is about bringing what has been amazing about digital advertising in terms of targeting relevance measurement, etc., and what we think is amazing about TV advertising, which is an incredible creative format, better creative format in many cases than digital, as well as the ability to put those advertisements next to content titles, stories that are, you know, impacting the social conversation, which is important for advertisers. So, lots of work ahead. We've got years of work to do, but that's the line that we're moving forward with.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Greg. From Steven Cahall, his question is "Given what we think are pressures on AVOD CPMs and the 10 hours per account per month of viewing time you disclosed at the upfront for ad-supported members, what's the likelihood that ad-supported ARM drops below ad-free member ARM in the second half? Would you consider raising the price of ad-supported tiers as an offset?

Gregory K. Peters -- Co-Chief Executive Officer

OK, so, perhaps, starting by just providing some clarification here. Our engagement on our ads plans is very similar to what we see on our non ads plans. That's close to the approximately two hours of viewing per member per day across all the plans that you can calculate globally from our engagement reports. You should think of that as roughly, you know, how our ads plan members are engaging as well.

And then, on terms of ads ARM, so ads ARM, which is of course, the combination of the subscription amount plus the ads revenue, currently, because we've been scaling so rapidly, we are not -- we're racing behind essentially to fulfill all of that increasing inventory, and we're lagging in that regard. So, currently our ads ARM is lower than our non ads ARM. And that's -- obviously, we look at that as both -- you know, it's a go-do, but it's a revenue growth opportunity for us as we scale into that. That represents an opportunity to accelerate our revenue growth as well.

So, you mentioned price. We think about pricing for ads tier very similarly to how we would think about pricing for our non ads tier. First of all, I just think it's worth noting that we love having an entry price that's lower. That means we are more accessible for more people.

In our ads markets, that's a great thing because they get access to all the amazing storytelling that we are doing there. But in terms of raising that price, we think about it similar to how we think about pricing in general, which is, you know, where it's our job to increase the value that we are delivering all of our members. We've got more amazing film, more series, the live events that are coming, more games. And when we have signals from our members, this is, you know, the amount of acquisition that we've got going on, engagement, what our retention and churn looks like, then we find the right moment to ask our members to pay a bit more to keep that flywheel spinning.

And we'll think about that in the ads context just like we would in the non ads context.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Greg. John Hodulik from UBS asks, "Can you provide an update on the CTV ad environment and update us on initial feedback from advertisers on your ad tech initiative? What features do you expect to add with the ad tech build? And anything you can tell us about the costs associated with it?"

Gregory K. Peters -- Co-Chief Executive Officer

Sure. There's a lot of excitement among advertisers to -- you know, about the work that we're doing. I'd say that the primary one and again one that we're responding to which is sort of very tactical and immediate is being able to provide advertisers more ways to buy on Netflix. So, those demand sources is something we heard very clearly from advertisers that, you know, they -- it was a -- they said either a real improvement for them, or it was a necessary point for them to be able to buy on Netflix.

So, then, beyond that, we hear lots of enthusiasm for the things I mentioned before, increasing ads relevancy, targeting personalization, better measurement, incrementality, all these, you know, things that we'll be building over the next several years, lots of excitement about that. The biggest negative feedback we get is that we aren't there right now. So, advertisers want us to have all those features in place today. We would love to have all of those features in place today for sure.

So, we're -- you know, we got the hard work ahead of us of, you know, building those as quickly as we possibly can and closing that gap as soon as we can. But this is -- you know, it's years ahead of us to go ahead and keep building these things. And quite frankly, as we build those features, I am quite certain that there'll be more that will come onto the roster that advertisers will be asking from us and more that we'll be excited about doing.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Greg. And our next question is for Ted coming from Rich Greenfield of LightShed --

Spencer Adam Neumann -- Chief Financial Officer

Hey, Spencer?

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Yes?

Spencer Adam Neumann -- Chief Financial Officer

Spencer, sorry to interrupt you. We didn't really ask the -- answer the kind of cost thing unless I missed it. Did I miss it in terms -- so I can chime in if you like. All of what Greg talked about in terms of investing in the business, suffice to say that is all embedded in our margin guidance.

So, we're -- we make trade-offs all the time with the business where, you know, our expenses are up 7% year to date, where if you kind of step back, we're on track to be -- you can do the math. It's probably north of 28 billion in total expenses across our business for the year. And we're still expecting to deliver 5 percentage points of margin improvement. So, we try to run the business like owners, make smart trade-offs, and invest into growth, like live, like ads, like games, like product innovation and ads as part of that, both for this year, as well as into next year where, again, we expect to drive revenue growth and increase our margins while investing into ads.

Gregory K. Peters -- Co-Chief Executive Officer

Thanks for catching that, Spence. Yeah.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thanks, Spence. Yes, thanks for keeping us honest, Spence. So, next question is for Ted coming from Rich Greenfield of LightShed Partners. Is your recent agreement to stream two NFL games on Christmas day signaling that you need live sports to build a robust advertising business? Or are you trying to create a regular cadence of high-profile live events to bring advertisers onto the Netflix platform who will then spend across your broad array of entertainment content?

Theodore A. Sarandos -- Co-Chief Executive Officer

Thank you, Rich. It's a great question. And let me back up a minute. We're in live because our members love it, and it drives a ton of engagement and it drives a ton of excitement.

And those two things are very valuable. So, the good thing is that advertisers like that, too, and they like it for the exact same reason, the excitement and the engagement. So, everyone's interests here are perfectly aligned in that way. When we signaled to the world when we went live with the "Chris Rock: Selective Outrage" special last -- a year ago, is that -- this company, Netflix, who you love for on-demand viewing of your favorite TV shows and movies, is also, I say also going to surprise you with amazing, exclusive, buzzy live entertainment.

And since then, we've launched a golf tournament with the great -- the biggest stars in PGA golf and Formula 1 drivers; a tennis match with two like generational titans of professional tennis, Nadal and Alcaraz; a live comedy with Katt Williams; an entire week of groundbreaking live talk show episodes from John Mulaney; that epic roast of Tom Brady, our biggest live stream yet. And still to come, we've got a live show with Joe Rogan. We have this hotdog eating grudge match between Chestnut and Kobayashi that people are remarkably excited about. We have this long-awaited boxing match between Mike Tyson and Jake Paul in November.

And on Christmas day, not just one, but two great NFL football games. So, I would call that a really fast ramp, and it leads right into a weekly live coverage of WWE. So, it's that thrilling excitement, engaged watching that people are really thrilled about, and we're thrilled about, and that we're thrilled that our advertisers are excited about it, too.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Ted. Rich has a part two --

Theodore A. Sarandos -- Co-Chief Executive Officer

Yeah.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

To this question, not surprisingly. How do you thread the needle on licensing sports to drive advertising spend without becoming beholden to leagues at renewal?

Theodore A. Sarandos -- Co-Chief Executive Officer

Well, hopefully, exactly the way we're doing it, by making these Netflix events. Not necessarily taking on a lot of tonnage from any one league, but actually making these these games events, like having two NFL football games on Christmas Day and two great games, the Chiefs and the Steelers, and the Ravens and the Texans. They're both going to be great games. And it's a really -- it creates a lot of real excitement with the service, and it's one day of football.

So, when I look at that, and I think along those lines, you'd see how we solved for that in our WWE deal, which was economics that we like and live with and can grow into and contemplate with that expansion of cost and viewing would be over in that case as long as 20 years, if we want it to be. So, I think it's really not a matter of -- there's an automatic disconnect between you can't do sports and have profit. It's very difficult to have big league sports and profit, you know, when you offer them entire seasons. But when you offer them in this event model that we're building on.

We're really excited about our opportunity to do that without the risks that you're talking about right now. So -- and then, beyond that, we're in love with the kind of very profitable storytelling version of sports. So, if you can't wait for those football games on Christmas day, you can watch "Receiver" right now. It just started on July 10th on Netflix, which is part of that storytelling version of sports.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Ted. Our next question comes from Kannan Venkateshwar of Barclays. It's a question regarding our engagement. So, Ted, could you speak to the underlying engagement health at Netflix and what are you seeing there?

Theodore A. Sarandos -- Co-Chief Executive Officer

Yeah, look, I think I've talked about this a bit on the last call as well, but, you know, competition for entertainment is super intense. And we compete for every second of view time we get. So, beyond that, you know, kind of that competitive intensity that's always been out there, we also anticipated some headwinds in our engagement because of paid sharing. Remember, we were taking folks who were watching Netflix and not paying off the service.

So, we thought that our engagement would go down. We took a deep dive into how that was impacting and how we could isolate that impact and look at it as owner households, so those folks who were not impacted by paid sharing at all. And what we saw was in last quarter is that that engagement was holding steady so that much of the engagement headwind was coming from that. And I look -- but now we look forward to the quarter.

Now, I'm not going to get in the habit of releasing this as a new metric every quarter, but looking at that same segment again, that segment's engagement is actually not just steady but up year on year. So, we're very excited about that. I think it's a very healthy sign of engagement growth. And even with all of that, so beating down the headwinds of that and beating down competition, we're still about 10% of TV time in every country we operate in.

So, still lots of room to grow but very pleased with our engagement, but not fully satisfied.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Ted. Our next question comes from Ben Swinburne of Morgan Stanley. Your primary competitor for more passive home entertainment engagement increasingly looks to be YouTube. What are you doing in terms of programming and product to try and take share from YouTube in the future, or is this not a focus? Are there key verticals, like kids programming, where you see YouTube as particularly advantage? Perhaps, Ted, you and Greg can tag team on this one.

Theodore A. Sarandos -- Co-Chief Executive Officer

Yeah, sure. Looking at the Nielsen data that just released for June, what you see there is Netflix and YouTube are the clear leaders in direct-to-consumer entertainment. So, our two services, us and YouTube represent about 50% of all streaming to the TV in the U.S. And we use the U.S.

only because that's where we have the data. So, really, what we're focused on here is focusing ourselves on that other 80% of total TV time that isn't going to either us or YouTube. So, that's both streaming continuing to expand, which it did in June. So, that's share of TV time grew against linear.

And as linear continues to give, I think there's a lot of opportunity for us to grow as long as we keep executing well. Now, we clearly do compete with YouTube in certain segments of their business, and we certainly compete with them for time and attention. But our services also feed each other really well. So, remember, our shows are the most watched and talked about and award-nominated.

We just came out of 107 Emmy nominations for our slate this year yesterday. And so, our teasers and trailers and behind-the-scenes clips and all those kinds of things are incredibly popular on YouTube. So, in that way, we kind of feed each other pretty nicely. Greg, I don't know if you want to add anything.

Gregory K. Peters -- Co-Chief Executive Officer

Sure, I think it's also important to note that Netflix fulfills an important and differentiated need for both consumers who really want -- you know, they want amazing spectacle movies and TV shows, as well as an important need for creators who want partners that can share in the risk that's inherent in bringing those stories to life. So, you think about, you know, shows like "Stranger Things" or "Wednesday," "Heartstopper," "Outer Banks," these shows create amazing human fandom, especially with younger audiences. So, it's not, you know, just one generation. And it's really hard to imagine how that kind of big creative bet would happen and be possible within YouTube's model.

So, you know, to Ted's point, it is very competitive out there. And we also feel confident that our model works. It works well for our consumers. It works well for creators.

And it works well for our business and helps us generate significant operating margins.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Ted and Greg. Our next question comes from Maria Ripps of Canaccord. Netflix's CTO, Elizabeth Stone, recently appeared on a podcast where she said that Netflix is exploring how to integrate generative AI into the platform to improve the member experience. Do you think that technology could have more of a potential impact on the content creation or discovery side? How do you think about the relative impact on engagement from improving discovery versus content? Greg, over to you for this one.

Gregory K. Peters -- Co-Chief Executive Officer

Yeah, we've been using similar technologies, AI and ML, for many years to improve the discovery experience and drive more engagement through those improvements. We think the generative AI has, you know, tremendous potential to improve our recommendations and discovery systems even further. We want to make it even easier for people to find an amazing story that's just perfect for them in that moment. But I think it's also worth noting that the key to our success stacks, right? It's quality at all levels.

So, it's great movies, it's great TV shows, it's great games, it's great live events, and a great and constantly improving recommendation system that helps unlock all of that value for all of those stories. Ted, you want to comment?

Theodore A. Sarandos -- Co-Chief Executive Officer

Yeah, it begs the question about, you know, the impact on creative with AI going forward, which is hard to predict, obviously. But I would say this, I think that AI is a great -- is going to generate a great set of creator tools, a great way for creators to tell better stories. And one thing that's sure, if you look back over a hundred years of entertainment, you can see how great technology and great entertainment work hand in hand to make, to build great big businesses. You could look no further than animation.

When animation didn't get cheaper, it got better in the move from hand-drawn to CG animation. And more people work in animation today than ever in history. So, I'm pretty sure that there's a better business and a bigger business in making content, 10% better than it is making it 50% cheaper. So, remember, I think that shows and movies, they win with the audience when they connect.

You know, it's in the beauty of the writing, it's in the chemistry of the actors, it's in the plot -- the surprise in the plot twist, all those things. And I'm not saying that audiences don't notice all these other things, but I think they largely care mostly about connecting with the storytelling. And I'd say they probably don't care much about budgets and, arguably, maybe not even about the technology to deliver it. So, my point is they're looking to connect.

So, we have to focus on how to tell on the quality of the storytelling. There's a lot of filmmakers and a lot of producers experimenting with AI today. They're super excited about how useful a tool it can be. And we got to see how that develops before we can make any meaningful predictions of what it means for anybody.

But our goal remains unchanged, which is telling great stories.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Ted and Greg. We now have a question from Ben Swinburne regarding product. And the question for Greg is, "Can you dimensionalize the opportunity from a new homepage? You said that this is the biggest update in a decade, which sounds meaningful. What are the primary areas of improvement you're targeting with this?"

Gregory K. Peters -- Co-Chief Executive Officer

Yeah, it's hard to know exactly at this moment how much benefit that new homepage will, you know, drive. I think it's worth noting that it's less about the improvements that we're going to deliver initially, but it's more about creating a structure that allows us to evolve and advance more freely than the current structure does. In terms of what are the pain points, what are we trying to solve, a lot of this is getting to the increase in diversity of entertainment that we are now offering. So, you know, we've been amazing at film and series for a long period of time.

But now, increasingly, we're adding live events into -- it's live events like, you know, the Brady roast, which was incredible, but it's a -- these are one-off event that we have to create demand for. It's live events like WWE, which are consistent and repeating, that we want to make sure that fans of that experience have an easy way to access those things. We're increasingly promoting games as well into our service. So, what we found is we need to create structures that allow us to flexibly, you know, go from one type of content and entertainment to another in terms of how we're promoting and connecting those.

So, there's things like that. There's also things like we want to increasingly recognize that we're doing -- even the same content type, we're doing different jobs for our users in different moments. And that could be, you know, Sunday afternoon family movie time. That'd be a great experience if we want to provide exactly the right discovery and choosing experience for, versus maybe late on Thursday night when you're coming home and you just want to get into the next episode of the series that you're currently cruising through.

So, it's that kind of flexibility we want to provide. This is -- our expectation is that this new structure will allow us to deliver, as the old structure did for a decade, multiple repetitive material benefits to users in terms of engagement, which lead into retention and then revenue. But again, that'll be a long iterative journey and mostly we're trying to take that first step and set us up for that.

Theodore A. Sarandos -- Co-Chief Executive Officer

And less technical, too, Greg. The UI is beautiful.

Gregory K. Peters -- Co-Chief Executive Officer

There we go. We like -- we like beauty as well. Beauty is good.

Theodore A. Sarandos -- Co-Chief Executive Officer

It is. It truly is.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you. Next question is from Jason Helfstein of Oppenheimer, "What have been the early results from phasing out the basic tier in a handful of your markets and how does that tie back to success in selling ads?" Greg, do you want to take that one?

Gregory K. Peters -- Co-Chief Executive Officer

Sure. As you've seen us do multiple times before, we spent a lot of energy on the right product experience for doing this migration. And then, what we do is we roll it out, and we test it, and we see how that goes and let our members tell us if we did a good job there or not. We make whatever changes and iterations before we then scale it out and roll it even further.

And I think it's, you know, worth noting here that we feel like, in this migration, we've got a very strong offering for our members. Essentially, we're providing them a better experience, two streams versus one. We've got higher definition. We got downloads.

And, of course, all at a lower price, $6.99 in the United States. We think that represents a tremendous entertainment value. And it includes ads. And for members who don't, you know, want that ads experience, they, of course, can choose our ads-free standard or premium plans as well.

And then, in terms of performance, I'll just let our actions speak for ourselves. When those things go well, we typically roll it out. And that's -- you know, we've had the confidence to move forward with that change in the U.S. and France, so that's an indicator of how it's going.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Greg. Next question comes from Eric Sheridan from Goldman Sachs. The question is regarding gaming. "Can you provide any update on your gaming initiative and user engagement and your ability to scale your gaming efforts?"

Gregory K. Peters -- Co-Chief Executive Officer

Sure, games is a big market. So, it's almost 150 billion X China and Russia, and not including ad revenue, which we aren't participating in our current model. And we're getting close to three years into our gaming initiative. And we're happy with the progress that we've seen.

We've had set ourselves pretty aggressive engagement growth targets. And we've met those, exceeded those in many cases, in 2023. We tripled that engagement, we're looking good in our engagement growth in '24, and we've set even aggressive -- more aggressive growth goals for '25 and '26. But worth noting that that engagement and that impact on our overall business at the current scale, it's still quite small.

It's also probably worth noting that the investment level in games relative to our overall content spend is also quite small. And we've calibrated the growth in investment with the growth in business impact, so we're being disciplined about how we scale that. Now, obviously, the job is to continue to grow that engagement to the place where it has a material impact on the business. I think you've seen this trajectory with us before, whether it's been a new content genre, like unscripted or film, or maybe getting the content mix right for a particular country.

You can think about Japan or India, which, you know, we're now in an amazing place through the hard work of our teams there. We continually iterate, we refine our programming based on the signals we get from our members. And if you look over several years with that model, we can make a huge amount of progress. We've launched over a hundred games so far.

We've seen what works, what doesn't work. We're refining our program to do more of what is working with the 80-plus games that we currently have in development. And one of those things that really is working is connecting our members with games based on specific Netflix IP that they love. And this is an area that we've been able to move in quickly in a particular space, which is interactive narrative games.

These are easier to build. And we place those in a narrative hub that we call Netflix Stories. Q2, we launched "Virgin River" and "Perfect Match." Starting this month, in July, we're going to launch about one new title per month into Netflix Stories. And this is amazing IP like "Emily in Paris" and "Selling Sunset." And we have lots more, including very different types of games yet to come in the quarters and years ahead.

Theodore A. Sarandos -- Co-Chief Executive Officer

Yeah. I just want to chime in for a second, Greg, if you don't mind. This is why I'm really excited about the opportunity in games, which is the way that it's pretty rare for a new content vertical like this to actually compliment or draft off of -- one off each other. So, every once in a while, we get something like "Squid Game: The Challenge" following the "Squid Game," the scripted series.

But I think our opportunity here to serve super fandom with games is really fun and remarkable. I think the idea of being able to take a show and give the super fan a place to be in between seasons, and even beyond that, to be able to use the game platform to introduce new characters, the new storylines or new plot twists, now, you could do those kinds of things and then they could then materialize in the next season, or in the sequel to the film. It's a really great opportunity and a rare one where one and one equals three here, and to kind of replicate some of the success we've seen building fandom and with live events and consumer products, this actually fits really nicely into that. So, I'm really excited to see where this goes.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Thank you, Ted. Thank you, Greg. Our last question comes from Jessica Reif Ehrlich of Bank of America. The question is regarding content spend.

Ted, you have targeted $17 billion in cash content spend this year. You're increasing your sports spending within that. How should we think about your spending on entertainment or non sports entertainment? And what's the overall content spending growth going forward?

Theodore A. Sarandos -- Co-Chief Executive Officer

Well, thanks for the question. I would like to just back up a little bit and say that, you know, creating TV and films for a big global audience is a creative process. So, remember, we're programming for more than 600 million people around the world who are watching us for a couple hours a day every day. So, we're -- we've got our work cut out for us.

And that's 17 billion. All those exciting things we talked about earlier are all tucked into that 17 billion. And that 17 billion will grow as our revenue grows. It won't grow as fast as our revenue grows, but it will grow to accommodate that.

And I think what's really important and where I think we have a real interesting advantage here is that we have these distributed creative teams all over the world. So, what's great about that is they are very tightly wound into the creative ecosystem in all these different countries: the star systems, the producer systems, and more importantly, the culture, what fans in those countries really love. So, we've got all these folks working at the same time so that in this creative process, which does have, you know, hot streaks and cold streaks, they can be operating pretty simultaneously to create a very steady cadence of big exciting hits. We certainly compete with Hollywood to make the best and most popular programming in the world, but we're also doing that in India, in Spain, in France, in Italy, in Germany, in Korea, in Japan, all over Southeast Asia and Mexico and Columbia, Spain, Argentina, and the U.K.

And the programming that we create in those countries, again, all part of that 17 bill, are all designed to thrill the local audience. And when they really, really thrill the local audience, there's a possibility, and sometimes a probability, that they could find a gigantic audience all over the world, including in North America. So, the team in EMEA, particularly in the U.K., is doing a remarkable job of this right now. So, they have been able to deliver big global hits, but they've been sensational in-country.

So, "Baby Reindeer" and "The Gentlemen," both landed with Emmy nominations yesterday and have been sensations in the U.S., but they are a phenomenon in the U.K. So, more than 50% of all of our members in the U.K. have watched or are watching "Baby Reindeer" and "The Gentlemen." Similarly, with "One Day," our original film "Scoop," so those things that are thrilling the world are super-serving the British audience. The same thing just came out of Paris -- or out of France with "Under Paris," which was 90 million views, 157 million view hours around the world.

More than half of every French member loves this movie. Same thing with "The Asunta Case" in Spain, more than 50% watching in Spain and big watching all over the world. "Queen of Tears" in Korea is another example that's happening in APAC right now. So, this kind of like super--serving local audiences, creating global content around the world gives us an efficiency that I think is getting better and better and a muscle that's getting stronger and stronger that I'm really excited about.

And how does that play out? You know, our slate coming up is unbelievable. So, in -- as we currently forecast, what we're going to deliver for the rest of this year and what we're going to deliver into -- in -- through '25, just before the end of this year, we've got "Squid Game" return. We've got "Emily in Paris" return. You've got a new season of "Selling Sunset," "Lincoln Lawyer," "The Diplomat," "Virgin River," "Love is Blind." Ryan Murphy has an incredible new season of "Monsters" that tells the Erik and Lyle Menendez story.

That's all just coming up before the end of the year. And then, looking forward, you know, the next -- you know, through '25, you've got new seasons of "Wednesday" and "Stranger Things" and "Night Agent." We're in production on "One Piece." So, there's a ton of excitement there just in our series. This week we kicked off the finale of "Cobra Kai," which is -- they're going to blow your mind. August 8th, we've got the finale of "Umbrella Academy" kicking off.

And then, brand new series that we're also thrilled about: Susanne Bier's "Perfect Couple," with -- this has got Nicole Kidman, and just a really fun, fun thriller; "Nobody Wants This" from Kristen Bell and Adam Brody; "Black Doves," a beautiful show out of the U.K.; "Beauty in Black" from Tyler Perry; "No Good Deed," which is bringing Ray Romano and Lisa Kudrow back to TV; "A Classic Spy" with Ted Danson; from Brazil, we have Senna; from Columbia, we've got "One Hundred Years of Solitude;" and then, of course, all those live events I taught you about. And our movie slate is fantastic with "Rebel Ridge," "Will & Harper," "Six Triple Eight," "The Piano Lesson," "Carry-On." These are -- we have got a lot packed into that. Our goal and our mission here is we have to spend the next billion dollars of programming better than anyone else in the world. And there's no one better at doing it than Netflix.

So, we're excited.

Spencer Adam Neumann -- Chief Financial Officer

Spencer, how do you not get excited about that? And then, also get excited about that -- we're going to do all that while, you know, growing content spends lower than revenue. That's a lot of stuff going on. Thanks, Ted.

Gregory K. Peters -- Co-Chief Executive Officer

It's all in there.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Love it.

Theodore A. Sarandos -- Co-Chief Executive Officer

It's all in there.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Well --

Theodore A. Sarandos -- Co-Chief Executive Officer

And the hotdog contest, too, Spence. Don't forget that.

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

All right, well, I'm going to leave it at that since it sounds like we're going to have a lot to watch. So, we all need a little bit more time. So, we'll end the Q2 call here. So, thank you, Ted, Greg, and Spence, for joining us today.

Thank you, investors and analysts, for dialing into our call. And we look forward to chatting with you next quarter. Thank you very much.

Duration: 0 minutes

Call participants:

Spencer Adam Neumann -- Chief Financial Officer

Spencer Wang -- Vice President, Finance, Investor Relations, and Corporate Development

Spence Neumann -- Chief Financial Officer

Theodore A. Sarandos -- Co-Chief Executive Officer

Gregory K. Peters -- Co-Chief Executive Officer

Greg Peters -- Co-Chief Executive Officer

Ted Sarandos -- Co-Chief Executive Officer

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Netflix (NFLX) Q2 2024 Earnings Call Transcript was originally published by The Motley Fool