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AI Earnings Analysis
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $45.18B | $39B | +15.85% |
Cost of Revenue | $23.28B | $21.04B | +10.63% |
Operating Income | $13.33B | $10.42B | +27.92% |
Net Income | $10.98B | $8.71B | +26.05% |
EPS (Basic) | $2.58 | $2.03 | +27.09% |
EPS (Diluted) | $2.53 | $1.98 | +27.78% |
R&D Expense | $3.39B | $2.93B | +15.93% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $55.6B | $53.63B | +3.67% |
Current Assets | $13.02B | $13.1B | -0.61% |
Total Liabilities | $28.98B | $28.89B | +0.33% |
Current Liabilities | $10.98B | $10.76B | +2.10% |
Stockholders' Equity | $26.62B | $24.74B | +7.57% |
Cash & Equivalents | $9.03B | $7.8B | +15.75% |
Long-Term Debt | $13.46B | $13.8B | -2.42% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $10.15B | $7.36B | +37.87% |
Investing Cash Flow | $1.04B | $-2.18B | +147.74% |
Financing Cash Flow | $-10.35B | $-4.07B | -153.92% |
Share Buybacks | $9.13B | $6.26B | +45.71% |
D&A | $333.39M | $328.91M | +1.36% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 29.5% | 26.7% | +2.78% |
Net Margin | 24.3% | — | — |
ROE | 41.3% | — | — |
ROA | 19.8% | — | — |
Current Ratio | $1.186 | — | — |
Debt to Equity | $1.089 | — | — |
Netflix delivered a standout fiscal 2025, with revenue rising 15.9% to $45.2B and operating income surging 27.9% to $13.3B, reflecting strong margin expansion and robust free cash flow generation.
Total revenue grew 15.9% year-over-year from $39.0B to $45.2B, indicating Netflix's ability to grow both its subscriber base and average revenue per user, likely supported by its ad-supported tier rollout and password-sharing crackdown initiatives.
Source: Source: 10-K Income Statement
Operating margin expanded approximately 280 basis points from 26.7% to 29.5%, as revenue growth of 15.9% outpaced cost of revenue growth of 10.6%, demonstrating improving content cost efficiency and operating leverage.
Source: Source: 10-K Income Statement & Key Ratios
Operating cash flow surged 37.9% to $10.1B, while investing cash flow turned positive at $1.0B (vs. -$2.2B prior year), signaling a meaningful improvement in Netflix's cash generation capacity and reduced capital intensity.
Source: Source: 10-K Cash Flow Statement
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Upgrade to unlockNetflix's cost of revenue, which includes content amortization and production costs, totaled $23.3B in FY2025. While growth was contained at 10.6%, any acceleration in content spending to compete with Disney+, Amazon Prime, and Apple TV+ could compress margins. Sustaining the current margin trajectory requires disciplined content investment.
Source: Source: 10-K Income Statement
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Upgrade to unlockNetflix had an exceptional fiscal 2025, with revenue growing 15.9% to $45.2B and net income rising 26.1% to $11.0B. Operating cash flow surged 37.9% to $10.1B, reflecting strong profitability and cash generation across the business.
The key takeaways from Netflix's FY2025 10-K are: operating margin expanded to 29.5% (from 26.7%), diluted EPS grew 27.8% to $2.53, and the company returned $9.1B to shareholders via buybacks. Revenue growth of 15.9% was supported by improved monetization, while cost of revenue grew at a slower 10.6%, driving meaningful margin expansion.
Yes, Netflix significantly grew its profits in FY2025. Net income increased 26.1% to approximately $11.0B, and operating income rose 27.9% to $13.3B, both growing considerably faster than revenue, which indicates strong operating leverage.
Key risks for Netflix include intensifying competition from Disney+, Amazon Prime, and Apple TV+ potentially pressuring content costs, currency headwinds from its large international business, and the risk of subscriber churn if price increases in mature markets are pushed too aggressively. The company also carries $13.5B in long-term debt while spending heavily on share buybacks.
Netflix appears in strong financial health based on its FY2025 10-K data, with a current ratio of 1.19, ROE of 41.3%, and $9.0B in cash and equivalents. Operating cash flow of $10.1B comfortably covers its debt obligations and funded $9.1B in share repurchases, though the debt-to-equity ratio of 1.09 is worth monitoring.
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