Media
Netflix's Q2 FY2026 revenue grew 13% year-over-year to $12.56B and net income rose 9% to $3.40B, but operating margin slipped 0.7 points to 33.4% as technology & development and sales & marketing expenses outpaced revenue growth, while operating cash flow fell 28% due to higher content spending and record share buybacks of $4.7B.
Key risk: Rising Content and Operating Cost Growth Outpacing Revenue
Cost of revenues increased 13% YoY to $6,036,965 thousand, largely due to a $479 million increase in content amortization, while technology and development (+22%) and sales & marketing (+16%) expenses grew faster than the 13% revenue growth, compressing operating margin by 0.7 points to 33.4%.
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