A Business at a Glance
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NETFLIX INC
NFLX
$304.2B
Mkt Cap
$70.09
+1.74%
NETFLIX INC (NFLX) has a current P/E ratio of 22.7, compared to its historical median P/E of 50.1. The stock is currently considered Cheap based on its historical valuation range.
NETFLIX INC (NFLX) has a 5-year average return on invested capital (ROIC) of 25.2%. This indicates strong capital allocation and a potential competitive advantage.
NETFLIX INC (NFLX) has a market capitalization of $295.3B. It is classified as a mega-cap stock.
NETFLIX INC (NFLX) does not currently pay a regular dividend. However, the company returns capital to shareholders through share buybacks, with a buyback yield of 2.32%.
Based on historical P/E analysis, NETFLIX INC (NFLX) appears cheap. The current P/E of 22.7 is 55% below its historical median of 50.1. The estimated fair value CAGR (P/E method) is 32.8%.
NETFLIX INC (NFLX) operates in the Services-Video Tape Rental industry, within the Communication Services sector.
NETFLIX INC (NFLX) reported annual revenue of $45.2 billion in its most recent fiscal year, based on SEC EDGAR filings.
Netflix is a global entertainment streaming service offering TV series, films, games, and live programming across diverse genres and languages, with members able to pause, resume, and change plans at any time. The company operates as a single segment, deriving revenues primarily from monthly membership subscription fees across a tiered pricing structure ranging from approximately $1 to $37 per month depending on country and plan features, supplemented by advertising revenue and other sources including consumer products and live experiences. Netflix's business model is subscription-based with a focus on content amortization and streaming delivery through its proprietary Open Connect network, competing for consumers' leisure time against linear television, other streaming providers, gaming platforms, and social media by striving to "win moments of truth" through compelling original and licensed content. The company operates globally across four geographic regions—United States and Canada, Europe/Middle East/Africa, Latin America, and Asia-Pacific—with approximately 16,000 full-time employees as of December 31, 2025, distributed across these regions to reflect the diversity of its global member base. Netflix's competitive moat rests on its proprietary technology platform, content production capabilities, global distribution infrastructure, and brand recognition, while its strategy centers on continuous margin expansion within defined operating targets through revenue growth that outpaces cost growth, particularly by leveraging pricing power, advertising expansion, and operational efficiency.
【Margin expansion and content investment】 Management expects to deliver 2026 revenue growth of 12% to 14% with operating margins of 31.5%, representing a 2 percentage point increase year-over-year, while maintaining disciplined investment in content and technology to sustain long-term growth. The company anticipates content amortization will increase approximately 10% in 2026 with a stable content cash-to-expense ratio of roughly 1.1x, supporting expansion across film, series, and emerging content formats including live events and interactive experiences. Netflix expects advertising revenue to reach approximately $3 billion in 2026 with continued growth in advertiser count and programmatic share, driven by enhanced ad tech capabilities, improved targeting, and measurement functionality. The company is investing in technology and development to build out its ad tech stack, improve content discovery through user interface enhancements, and develop gaming and interactive content experiences, while maintaining its long-term aspirational goals of doubling revenue and tripling profits through organic growth.
| Metric | Target | Period |
|---|---|---|
| Revenue | 12% to 14% growth | FY 2026 |
| Operating margin | 31.5% | FY 2026 |
| Advertising revenue | $3 billion | FY 2026 |
| Content amortization growth | ~10% year-over-year | FY 2026 |
| Revenue | $51 billion | FY 2026 |
Revenue (FY 2026): “we are maintaining our guidance, our strong outlook for organic growth that we established for 2026. That's revenue growth of 12% to 14%”
Operating margin (FY 2026): “operating margin at 31.5%”
Advertising revenue (FY 2026): “We continue to expect to deliver that $3 billion in advertising revenue this year.”
Content amortization growth (FY 2026): “For the full year, we're estimating, as I think you see in our letter, content amortization to increase roughly 10% year-over-year.”
Revenue (FY 2026): “We forecast 2026 revenue at $51 billion, which is up 14% year-on-year.”
Generated solely from the company's own reports listed below — not from third-party data. Hallucination risk is low. · Sources: FY2026 10-K, Q1 2026 Earnings Call, Q4 2025 Earnings Call, Q3 2025 Earnings Call, Q1 2025 Earnings Call
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 46.9B | 45.2B | 39.0B | 33.7B | 31.6B | 29.7B |
| Net Income | 13.4B | 11.0B | 8.7B | 5.4B | 4.5B | 5.1B |
| EPS | $3.09 | $2.53 | $1.98 | $1.20 | $1.00 | $1.12 |
| Free Cash Flow | 11.9B | 9.5B | 6.9B | 6.9B | 1.6B | -132M |
| ROIC | 35.0% | 36.7% | 29.6% | 21.6% | 16.5% | 21.5% |
| Gross Margin | 49.0% | 48.5% | 46.1% | 41.5% | 39.4% | 41.6% |
| Debt/Equity | 0.46 | 0.54 | 0.63 | 0.71 | 0.69 | 0.97 |
| Dividends/Share | $0.00 | - | - | - | - | - |
| Operating Income | 13.9B | 13.3B | 10.4B | 7.0B | 5.6B | 6.2B |
| Operating Margin | 29.7% | 29.5% | 26.7% | 20.6% | 17.8% | 20.9% |
| ROE | 43.0% | 42.8% | 35.2% | 26.3% | 21.6% | 32.3% |
| Shares Outstanding | 4,213M | 4,340M | 4,400M | 4,495M | 4,514M | 4,552M |
NETFLIX INC passes 8 of 9 quality checks, indicating strong fundamentals.
NETFLIX INC trades at 22.7x trailing earnings, compared to its 15-year median P/E of 50.1x, suggesting it is currently Cheap relative to its historical range. On a free-cash-flow basis, the stock trades at 24.8x vs a median of 50.5x. The company's 5-year average ROIC is 25.2% with a gross margin of 43.4%. Total shareholder yield (buybacks) is 2.3%. At current prices, the estimated annualized return to fair value is +41.5%.
NETFLIX INC (NFLX) has a net profit margin of 24.3%. This is a strong margin indicating high profitability.
NETFLIX INC (NFLX) generated $9.5 billion in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
NETFLIX INC (NFLX) has a debt-to-equity ratio of 0.54. This indicates moderate leverage.
NETFLIX INC (NFLX) reported earnings per share (EPS) of $2.53 in its most recent fiscal year.
NETFLIX INC (NFLX) has a return on equity (ROE) of 42.8%. This indicates the company generates strong returns for shareholders.
NETFLIX INC (NFLX) has a 5-year average gross margin of 43.4%. This indicates decent pricing power.
The Ledger Terminal provides 19 years of financial data for NETFLIX INC (NFLX), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
NETFLIX INC (NFLX) has a book value per share of $6.13, based on its most recent annual SEC filing.
Based on recent SEC filings and earnings disclosures, Management expects to deliver 2026 revenue growth of 12% to 14% with operating margins of 31.5%, representing a 2 percentage point increase year-over-year, while maintaining disciplined investment in content and technology to sustain long-term growth. The company anticipates content amortization will increase approximately 10% in 2026 with a stable content cash-to-expense ratio of roughly 1.1x, supporting expansion across film, series, and emerging content formats including live events and interactive experiences. Netflix expects advertising revenue to reach approximately $3 billion in 2026 with continued growth in advertiser count and programmatic share, driven by enhanced ad tech capabilities, improved targeting, and measurement functionality. The company is investing in technology and development to build out its ad tech stack, improve content discovery through user interface enhancements, and develop gaming and interactive content experiences, while maintaining its long-term aspirational goals of doubling revenue and tripling profits through organic growth.
Based on recent SEC filings and earnings calls, NETFLIX INC (NFLX) has provided the following forward guidance: Revenue: 12% to 14% growth (FY 2026); Operating margin: 31.5% (FY 2026); Advertising revenue: $3 billion (FY 2026); Content amortization growth: ~10% year-over-year (FY 2026); Revenue: $51 billion (FY 2026).