What are the investment strengths of Netflix Inc (NFLX)?

ROIC of 26.4% TTM vs industry median 5.4% with debt/equity of 0.56 - generates excess returns at low leverage, enabling 9B+ annual FCF for buybacks or M&A Revenue 43.4B is 40x industry median (1.1B) with 29% operating margins - scale moat widens as smaller competitors struggle to fund content

What are the investment risks for Netflix Inc (NFLX)?

P/E 40.4x vs industry median 25.2x and P/S 9.7x vs median 1.1x - premium valuation requires flawless execution with no room for subscriber misses Negative tangible book value (-6.7B) with 32.6B goodwill - content library write-downs could materially impair equity

Netflix Inc

NFLX

—

Netflix Inc AI Insights

Informational only. Not investment advice.

As of 2025-12-08

Snapshot

Operating margin TTM 29.1% vs industry median 3.7% - 8x advantage drives 10.4B net income on 43.4B revenue[Operating Margin TTM]
Goodwill 32.6B is 126% of equity (25.9B) - negative tangible book value of -6.7B creates impairment risk[Goodwill and Other Intangible Assets]
FCF TTM 9.0B on capex of just 608M (1.4% of revenue) - asset-light model funds buybacks without debt[Free Cash Flow TTM]

Watch Triggers

Operating Margin TTM: Falls below 25% — Signals content cost inflation outpacing revenue growth - thesis invalidation
Free Cash Flow TTM: Drops below 6B — Would indicate content spend acceleration or subscriber growth stall
Goodwill and Other Intangible Assets: Impairment charge announced — Content library devaluation would crush already-negative tangible equity

Bull Case

ROIC of 26.4% TTM vs industry median 5.4% with debt/equity of 0.56 - generates excess returns at low leverage, enabling 9B+ annual FCF for buybacks or M&A

ROIC TTMDebt to EquityFree Cash Flow TTM

Revenue 43.4B is 40x industry median (1.1B) with 29% operating margins - scale moat widens as smaller competitors struggle to fund content

Total Revenue TTMOperating Margin TTM

Bear Case

P/E 40.4x vs industry median 25.2x and P/S 9.7x vs median 1.1x - premium valuation requires flawless execution with no room for subscriber misses

PE RatioPS Ratio

Negative tangible book value (-6.7B) with 32.6B goodwill - content library write-downs could materially impair equity

Tangible Book ValueGoodwill and Other Intangible Assets

Bull vs Bear Balance

AI-generated sentiment analysis based on fundamental metrics and market conditions.

55%

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Forward Thesis

Margin expansion to continue as content amortization peaks while ad-tier scales

1-3ymed

Content library leverage - fixed costs spread over growing subs
Ad-tier ARPU accretion without proportional content spend
Password sharing crackdown converting freeloaders to paid

Operating margin 29.1% TTM already 8x industry medianFCF margin 20.7% with minimal capex requirementsROE 42.9% indicates efficient capital deployment

Valuation Context

Caveats

Public Strategies Rankings

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NFLX Fundamentals

Information → Motion Picture and Video Industries

Metric	Value	YoY Growth	Industry Percentile
Market Cap	$357.27B		—
Enterprise Value	$362.7B		—
P/E Ratio	33		—
Total Revenue - TTM	$45.18B	+15.9%	—
Earnings Per Share (diluted) - TTM	$2.53	+27.6%	—
Operating Margin - TTM	29.5%	+2.8%	—
Net Margin - TTM	24.3%	+2.0%	—
Free Cash Flow - TTM	$9.46B	+36.7%	—
Return on Common Equity - TTM	0.43	+4.3%	—
Beta 5Y (Monthly)	unknown		—

NFLX Dividend History

No dividends

NFLX Stock Splits

3 stock splits

11/17/251:10 split

07/15/151:7 split

02/12/040.5:1 split

NFLX SEC Filings

Filing Date	Report Date	Report Type	Filing Link
01/23/26	12/31/25	10-K	0001065280-26-000034
10/22/25	09/30/25	10-Q	0001065280-25-000406
07/18/25	06/30/25	10-Q	0001065280-25-000323
04/18/25	03/31/25	10-Q	0001065280-25-000176
01/27/25	12/31/24	Unknown	0001065280-25-000044
10/18/24	09/30/24	10-Q	0001065280-24-000287
07/19/24	06/30/24	10-Q	0001065280-24-000200
04/22/24	03/31/24	10-Q	0001065280-24-000128
01/26/24	12/31/23	10-K	0001065280-24-000030
10/20/23	09/30/23	10-Q	0001065280-23-000273
07/21/23	06/30/23	10-Q	0001065280-23-000198
04/21/23	03/31/23	10-Q	0001065280-23-000120
01/26/23	12/31/22	10-K	0001065280-23-000035
10/20/22	09/30/22	10-Q	0001065280-22-000368
07/21/22	06/30/22	10-Q	0001065280-22-000257
04/21/22	03/31/22	10-Q	0001065280-22-000145
01/27/22	12/31/21	10-K	0001065280-22-000036
10/21/21	09/30/21	10-Q	0001065280-21-000363
07/22/21	06/30/21	10-Q	0001065280-21-000250
04/22/21	03/31/21	10-Q	0001065280-21-000144
01/28/21	12/31/20	10-K	0001065280-21-000040
10/22/20	09/30/20	10-Q	0001065280-20-000451
07/20/20	06/30/20	10-Q	0001065280-20-000309
04/21/20	03/31/20	10-Q	0001065280-20-000155
01/29/20	12/31/19	10-K	0001065280-20-000040
10/18/19	09/30/19	10-Q	0001065280-19-000368
07/19/19	06/30/19	10-Q	0001065280-19-000260
04/18/19	03/31/19	10-Q	0001065280-19-000157
01/29/19	12/31/18	10-K	0001065280-19-000043
10/18/18	09/30/18	10-Q	0001065280-18-000538
07/18/18	06/30/18	10-Q	0001065280-18-000360
04/18/18	03/31/18	10-Q	0001065280-18-000205
01/29/18	12/31/17	10-K	0001065280-18-000069
10/18/17	09/30/17	10-Q	0001065280-17-000180
07/19/17	06/30/17	10-Q	0001065280-17-000046
04/20/17	03/31/17	10-Q	0001628280-17-003939
01/27/17	12/31/16	10-K	0001628280-17-000496
10/20/16	09/30/16	10-Q	0001065280-16-000081
07/19/16	06/30/16	10-Q	0001065280-16-000072
04/20/16	03/31/16	10-Q	0001065280-16-000057
01/28/16	12/31/15	10-K	0001065280-16-000047
10/16/15	09/30/15	10-Q	0001065280-15-000038
07/17/15	06/30/15	10-Q	0001065280-15-000031
04/17/15	03/31/15	10-Q	0001065280-15-000017
01/29/15	12/31/14	10-K	0001065280-15-000006
10/20/14	09/30/14	10-Q	0001065280-14-000028
07/22/14	06/30/14	10-Q	0001065280-14-000021
04/23/14	03/31/14	10-Q	0001065280-14-000012
02/03/14	12/31/13	10-K	0001065280-14-000006
10/25/13	09/30/13	10-Q	0001065280-13-000036
07/25/13	06/30/13	10-Q	0001065280-13-000030
04/26/13	03/31/13	10-Q	0001065280-13-000020
02/01/13	12/31/12	10-K	0001065280-13-000008
10/30/12	09/30/12	10-Q	0001065280-12-000020
08/02/12	06/30/12	10-Q	0001065280-12-000012
04/27/12	03/31/12	10-Q	0001445305-12-001242
02/10/12	12/31/11	10-K	0001193125-12-053009
10/27/11	09/30/11	10-Q	0001193125-11-284366
07/27/11	06/30/11	10-Q	0001193125-11-198669
04/27/11	03/31/11	10-Q	0001193125-11-112061
02/18/11	12/31/10	10-K	0001193125-11-040217
11/07/11	09/30/10	10-Q/A	0001193125-11-297992
07/27/10	06/30/10	10-Q	0001193125-10-167382
04/28/10	03/31/10	10-Q	0001193125-10-095215
02/22/10	12/31/09	10-K	0001193125-10-036181
10/26/10	09/30/09	10-Q	0001193125-10-235785
10/26/09	09/30/09	10-Q	0001193125-09-213071
07/31/09	06/30/09	10-Q	0001193125-09-160729
05/08/09	03/31/09	10-Q	0001193125-09-103685
02/25/09	12/31/08	10-K	0001193125-09-037430
11/03/08	09/30/08	10-Q	0001193125-08-222820
08/11/08	06/30/08	10-Q	0001193125-08-173275
05/06/08	03/30/08	Unknown	--
02/28/08	12/31/07	4	0001219053-08-000007
11/02/07	09/30/07	10-Q	0001193125-07-233664
08/06/07	06/30/07	10-Q	0001193125-07-171865
05/07/07	03/30/07	Unknown	--
02/28/07	12/31/06	10-K	0001193125-07-042689
11/09/06	09/30/06	10-Q	0001193125-06-230314
08/09/06	06/30/06	4	0001219053-06-000122
05/09/06	03/31/06	4	0001219053-06-000060
03/16/06	12/31/05	10-K	0001193125-06-056663
11/09/05	09/30/05	10-Q	0001193125-05-221711
08/09/05	06/30/05	4	0001219053-05-000085
05/10/05	03/30/05	Unknown	--
03/15/05	12/31/04	10-K	0001193125-05-051159
11/09/04	09/30/04	10-Q	0001193125-04-191186
08/02/04	06/30/04	10-Q	0001193125-04-128377
04/30/04	03/30/04	Unknown	--
02/27/04	12/31/03	10-K	0001193125-04-031416
10/31/03	09/30/03	10-Q	0001193125-03-070952
07/31/03	06/30/03	4	0001219053-03-000082
05/14/03	03/30/03	Unknown	--
03/31/03	12/31/02	10-K	0000950168-03-001155
11/14/02	09/30/02	10-Q	0001021408-02-014175
08/14/02	06/30/02	10-Q	0001012870-02-003483
03/31/02	03/30/02	Unknown	--