Tubi hit profitability this year doing what other streaming services are trying to: attract younger audiences who are willing to sit through ads.

The Fox Corp.-owned free streaming platform has long been among a sort of second tier of streaming services alongside lower-budget and less popular offerings like Pluto and The Roku Channel. But the free service is gaining traction and finding its footing in conversations with the big players.

In November, Tubi made up 2.1% of total streaming minutes on The Gauge, Nielsen’s monthly analysis of viewing trends, ahead of NBCUniversal’s Peacock and Warner Bros. Discovery’s HBO Max. Google’s YouTube holds the top spot in the viewership tracker.

“Our fans come in, and they behave like [subscription streaming] viewers. The only difference is they don’t pay for it,” said Tubi’s chief marketing officer, Nicole Parlapiano, in an interview.

Netflix’s dominance in streaming has led many media companies to chase the same success, spending billions of dollars on original content to attract subscribers and strive for profitability.

In response, the cost of streaming has risen, with nearly every subscription platform instituting multiple price hikes in recent years and pushing consumers toward cheaper, ad-supported options. A crackdown on password sharing by some of the biggest players has also shaken up the space.

“People used to cut the cord, now they’re canceling subscriptions. And is that driving more consumption into free streaming? Absolutely,” Tubi Chief Content Officer Adam Lewinson told CNBC.

Tubi said it has more than 100 million monthly active users and 1 billion hours of streamed content per month. For comparison, Netflix reported more than 300 million subscribers as of late 2024, the last time it reported the metric, while Disney+ reported 131 million subscribers as of the end of September.

Nearly 60% of Tubi’s audience is made up of millennials or members of Generation Z, and nearly half are multicultural, Tubi said, citing an MRI-Simmons Cord Evolution Study of its audience.

Tubi bulks up its library by licensing films and TV series — some popular and some niche. The platform does produce original content, albeit at a smaller scale than its competitors. It’s also tapped Fox’s sports arsenal, airing two NFL games this year on Tubi, most notably the Super Bowl in February and a Thanksgiving Day game last month.

In total, Tubi boasts more than 300,000 titles on its platform.

In October, Fox reported that Tubi had reached profitability for the first time for the fiscal quarter ended Sept. 30, with Fox CEO Lachlan Murdoch adding that it reached that milestone “earlier than expected.” Tubi reported 27% revenue growth for the quarter, which was driven by an 18% increase in total view time.

Murdoch said at the time the hope was for Tubi to continue on its trajectory so it could become “a meaningful contributor” to earnings in the near term.

The growth is validation for Fox, which took a different tack to the streaming game than its media peers. Its stock is up more than 40% this year, while other media stocks haven’t fared nearly as well amid a sea of uncertainty.

The company offloaded its entertainment assets to Disney in 2019, and its TV business — broadcast network Fox and cable networks like Fox News — consist mostly of news and sports. In 2020, the media company acquired Tubi for $440 million.

Since then, Tubi had been Fox’s main answer to streaming until recently, when the company launched Fox One, a direct-to-consumer streaming service of all Fox content for $19.99 per month. Murdoch has emphasized there are no plans for Fox One to produce original or exclusive content, leaving Tubi to shine with a digital and cost-conscious audience.

A recent report from MoffettNathanson notes that streaming engagement remains strong at YouTube, followed by free, ad-supported platforms that include FAST channels like Tubi, Paramount Skydance’s Pluto, and Roku’s The Roku Channel.

Tubi executives say the platform often gets caught up in the same conversation as platforms like Pluto because it offers channels in a guide format that reflect the traditional linear model. However, since nearly all of its viewership is on demand – meaning viewers are selecting films and series from the library rather than tuning into a preprogrammed channel – Tubi argues it should swim in the same pool as subscription services like Netflix and Disney+.

“Ninety-five percent of people are coming in with the intent to watch what they want to watch, and they are leaned in. They’re not passive viewers,” said Tubi’s Parlapiano.

Executives say that selection process makes Tubi viewers more inclined to watch ads than those tuning into other free, ad-supported channels for more of a laid-back experience — or simply to have something on in the background. That’s a strong sales pitch for advertisers.

“We’re 100% ad-supported, which other streamers are not. Yes, they have ad-supported tiers, but it’s unclear on each platform how big those tiers are and how much viewing is happening in an ad-supported environment,” Parlapiano said.

On Fox’s most recent earnings call, CFO Steve Tomsic said the company’s overall TV advertising revenue was up 6%, primarily driven by Tubi’s growth.

In June, Tubi launched Tubi for Creators, part of a broader push from the company into incorporating content creators into Hollywood.

“The idea behind it is to give creators a pathway to Hollywood that really allows them to maintain their authenticity that made them popular in the first place and maintain a lot of creative control,” said Rich Bloom, head of Tubi for Creators. “We launched with six creators and about 500 episodes of content, and we’re now up to well over 100 creators and over 10,000 episodes of content.”

Tubi has signed deals with well-known YouTube entertainers to add their existing episodes to the platform, such as Dan and Riya’s “Beverly Valley High” and FunnyMike’s series “Mr. Creepy Eyes.” It’s also been inking deals with independent filmmakers through Kickstarter-funded projects.

Bloom said Tubi has seen that the category is attracting new, younger audiences, and the “retention rate of those viewers is actually better than our general new viewers.”

Tubi’s Lewinson said the platform has been particularly successful with young adult movies, like “Sidelined” and “Sidelined 2,” starring TikTok star Noah Beck. The franchise has brought in nearly 20 million viewers alone, with the median age of new viewers watching the sequel just 21 years old, Lewinson added.

“We are really proving that we can bring young viewers to a long-form streaming platform,” he said. “There’s a perception that they’re only interested in short-form – completely not accurate. So long as you have relevant content for their fandom, they’ll come to Tubi.”

Gen Z is also leaning into nostalgia, with older shows like “Columbo” and “Murder, She Wrote” popular on Tubi, too.

Tubi executives note its growing Gen Z and millennial audience is another selling point for advertisers.

“My acquisition team can go out and acquire whatever we can possibly find, but we’re finding that as we produce these types of stories, we’re really bringing in those viewers,” Lewinson said. “They’ll come in to watch ‘Sidelined,’ but then we’re following their journey to see what else they’re watching on the platform, and we’re making sure that we have plenty of those types of categories for those viewers to watch.”

Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant would become the new parent company of CNBC upon Comcast’s planned spinoff of Versant.