Tariff Tremors Rattle Media

Media earnings season is upon us. Netflix kicked off the period this week on a high note, reporting record profits and a strong forecast for the year ahead. But investors were eager to find out if the streaming giant was beginning to see signs of trouble emerging from Donald Trump’s tariff war.

Greg Peters, the Netflix co-chief executive, had terrific news.

“We’re paying close attention to the consumer sentiment and where the broader economy is moving, but based on what we are seeing by actually operating the business right now, there’s nothing really significant to note,” Peters said on an earnings call.

That sense of calm, however, may be unique to Netflix—the world’s largest streaming platform and the rare modern media juggernaut with consistent profitability and global scale. But for the rest of the media landscape, much of which has been disrupted by Netflix’s rise to dominance, a looming trade war and possible recession could deal a crushing blow to already-fragile business models.

Earlier this month, MoffettNathanson media analyst Michael Nathanson projected that Trump’s massive tariffs hike—including a 145% levy on Chinese imports and 10% blanket tariffs on all other countries—could wipe out a staggering $45 billion in U.S. advertising spending in 2025. “Given the ongoing secular headwinds facing the linear television ecosystem, we worry that television could mirror the fate of radio and newspapers during past recessions,” he warned.

And while Trump continues to waffle on the severity of the tariffs he will slap on global allies and rivals alike, the uncertainty couldn’t come at a worse time for the television business, which is already buckling under pressure from streamers and technology behemoths like Google and Meta. At next month’s annual upfront presentations, the volatility will surely cast a shadow over an already challenged industry.

And the implications are grave. During the 2008 financial crisis, advertising budgets were among the first casualties as companies raced to protect margins. Now, with linear television in steep decline and digital platforms battling for profitability, another economic shock could spark widespread belt-tightening across the industry.

It’s not just advertisers who could hit pause. Consumers, too, could pull back as tariffs drive up prices and economic anxiety deepens. If inflation ticks upward and household budgets tighten, streaming subscriptions and pay TV services—often among the first to be trimmed when wallets are squeezed—could face higher churn and slower growth. For smaller streamers like Paramount+ and Peacock that rely on both ad-supported and subscription tiers, a downturn could squeeze them from both sides.

Tellingly, a Fox Business anchor recently floated this idea to viewers as a way to offset tariff-related price hikes: "Maybe these are moments where you say—Okay what am I spending money on? How many subscription services do I have right now that I'm not watching?"

Media executives aren’t waiting to find out. As Status first reported, Warner Bros. Discovery recently told employees to halt all “non-business-critical” travel, citing “market volatility and reduced consumer confidence.” The David Zaslav-led media giant, already under pressure to reduce debt and streamline operations, has been increasingly cautious about its spending commitments. Disney, meanwhile, is bracing for higher costs tied to the tariffs. As Status also first reported, chief executive Bob Iger told ABC News staffers that the tariffs will likely drive up Disney’s costs and it may need to scale back spending.

"If I were a media company that relies on advertising, I'd be making sure my contingency plans are ready to go and preparing my cutbacks and layoffs right now," one longtime media executive told Status earlier this month.

While Netflix may be shielded in the short term thanks to its global footprint and position as the king of streaming, even it could eventually feel the squeeze if Trump’s tariff war prompts consumers to cut back on nice-to-haves. The company has increasingly leaned on advertising revenue through its lower-priced ad-supported tier, a business that’s still in its early stages and would likely be impacted by a shrinking advertising pie.

For now, the industry appears to be in wait-and-see mode. Executives are putting on brave faces, just as Peters did during Netflix’s earnings call. But, beneath the surface, alarm bells are surely ringing.