Netflix
The world's biggest television subscription: one app and one monthly fee, streaming shows and films it mostly owns to homes in 190 countries.
Our viewNeutral Medium conviction
The scores
The profile · 1-4
Growth3/4 ↓
Revenue grew 15.9% in 2025 organically, but viewing hours grew 2% and North American growth halved to 10% in three quarters.
Business quality3/4 ↓
Households pay Netflix about 48% more than Disney+ for the same job, but YouTube holds 14.2% of American television time to Netflix's 7.8%.
Financial position4/4 →
Net debt of $5.2B against about $12.5B of guided yearly free cash flow, an undrawn $3B facility, and no outside money needed.
Execution record3/4 →
The 2025 targets were met and Q2 2026 landed in line, but the reporting keeps shrinking - memberships gone, view hours annual from 2027.
Per share capture4/4 →
Share count down 2.7% in six quarters, no convertibles, both deals cash - but H1 buybacks averaged about $90 against $71.36 today.
Potential2/4 →
Large room in a market where Netflix holds 7.8% of American television time, but advertising is somebody else's spending decision and nothing is contracted.
Risk profile3/4 ↓
No customer concentration and four regions, but one product carries every risk and Brazilian tax assessments cost $729M of cash in H1 2026.
Valuation3/4 ↑
About $24 for each dollar of guided 2026 profit reflects the plan working, not the good case beyond it.
Evidence quality3/4 →
Central claims are filed facts from four independent filers plus Nielsen, but the price frame runs on management's own guide and no churn figure exists.
The bet · 2-3 years
Safe, little upside0.9×
If it works 0.9× · if it fails you keep about 79%.
The Verdict
We rate Netflix neutral. It is the world's biggest television subscription, and the business is solid: spreading each show's cost across hundreds of millions of homes lets it charge more than rivals and keep more profit. The shares have fallen sharply, partly deservedly, because YouTube takes far more American viewing and cash spent on shows is rising faster than the cost charged to profit. The price is fair, not cheap. As a bet it is safe, with little upside: memberships keep most of today's price, and advertising would not earn the rest. The view hinges on show spending slowing as promised.
The long caseIf advertisers follow viewers to streaming, the service with hundreds of millions of watchers can sell them adverts on top of the fees it already charges.
The evidence under this - 10 claims
C03factmedium confidence
The last paid-membership figure Netflix published is from the Q4 2025 letter: it 'crossed the 325M paid memberships milestone during the quarter'. Quarterly membership reporting stopped in 2025.
C11estimatemedium confidence
Netflix's FY2025 revenue of $45,183.0M over the 325M paid memberships it last reported is about $11.6 a month, roughly 48% above the $7.81 Disney reports for Disney+ worldwide.
derived$45,183.0M divided by 325M is $139.0 a year, or $11.58 a month. $11.58 divided by $7.81 is 1.48. The membership figure is a year-end milestone rather than an average, so the true per-member figure on an average base is slightly higher. Derived from C02, C03 and C10.
against this
- Netflix's base is a year-end 'crossed 325M' milestone and Disney's is a fiscal-year average, so the two denominators are not constructed the same way. Using an average Netflix base would widen the gap rather than narrow it, but the mismatch is real.
- Disney counts a bundle subscriber once for Disney+ and once for Hulu and allocates the revenue between them, which depresses the stated Disney+ figure relative to what the household actually pays Disney. A household paying for the Disney+/Hulu bundle is worth more to Disney than $7.81.
C43facthigh confidence
The shares closed at $71.36 on 23 September 2026, down 41.9% over 252 sessions and 42.8% below the 252-day high of $124.86, with a trailing price of about 22.2 times earnings against a six-year median of 41.7.
- 2026-09-24editedRe-read from the research pack of 2026-09-24 (close of 2026-09-23): the refresh trigger 'the next research pack' fired.
C13facthigh confidence
Nielsen measured YouTube at a record 14.2% of United States television watch-time in July 2026, the largest share of any distributor and 5.0 points ahead of the second, against Netflix at 7.8%, level with FOX behind NBCUniversal-Versant and Disney.
against this
- The Media Distributor Gauge groups by company, so Disney's 8.9% and NBCU-Versant's 9.2% include broadcast and cable networks as well as streaming. Among streaming platforms alone Netflix is second, behind YouTube; Nielsen's July Gauge puts Disney's streaming services at 4.7%.
- July 2026 carried the final weeks of the FIFA World Cup on FOX and Telemundo, which lifted broadcast and Peacock; part of every other distributor's share loss that month is the tournament rather than a trend.
- Nielsen states that methodological updates to The Gauge will be implemented in autumn 2026, with back data provided, so the series is not guaranteed to remain consistent.
- 2026-09-24editedRe-sourced: its refresh trigger fired when Nielsen published the July 2026 Gauge on 10 September; YouTube rose to a record 14.2% and Netflix fell to 7.8%.
C05facthigh confidence
In H1 2026 Netflix added $9,774.4M of cash to content assets, up 32.3% on H1 2025's $7,385.5M, while the amortisation charged against profit was $8,529.2M, up 11.4% on $7,655.2M.
C27estimatemedium confidence
At $71.36 the equity is about $304B and enterprise value about $309B, so Netflix's own 2026 guide of about $16.1B of operating profit and about $12.6B of net profit puts the price at about $24 for each $1 of net profit and about $19 of enterprise value for each $1 of operating profit.
derived4,261.3M Q2 2026 diluted shares at $71.36 is $304.1B; plus $14,309.3M of debt less $9,127.9M of cash is $309.3B. The $51.2B revenue mid-point at the guided 31.5% margin is $16,128M of operating profit; less H1 2026 interest expense of $437.8M doubled, plus about $200M of other income, taxed at H1's 18.2%, is about $12,640M, or $2.98 on about 4,240M shares. Derived from C20, C24 and C26 and the pack's closing price of 23 September 2026.
against this
- It runs entirely on management's own guide, which is a management claim and not a filed figure. If the 31.5% margin is missed by one point the net figure falls about $420M and the multiple rises by about 0.8.
- The pack's own trailing figure is 22.2 times earnings against a six-year median of 41.7, so on the comparison a screen actually makes the shares look far cheaper than this frame does. Both are true and they differ because one is trailing and reported and the other forward and guided.
- Analysts' consensus earnings of $4.55 for 2028 and $6.46 for 2030 would put the same price at 15.7 and 11.0 times, so the frame is demanding only if growth beyond 2026 disappoints those estimates.
- 2026-09-24editedRe-struck at the 2026-09-23 close of $71.36: the thesis's 12% drift trigger fired. The consensus figures in the counter-evidence are re-read from the new pack.
C08estimatemedium confidence
Trailing diluted earnings per share of $3.18 include about $0.53 from the termination fee after tax, so at $71.36 the price is about $27 for each $1 of profit excluding the fee against about $22 including it.
derivedFiled diluted EPS of $0.59, $0.56, $1.23 and $0.80 for Q3 2025 to Q2 2026 sum to $3.18. The $2.8B fee taxed at the H1 2026 effective rate of 18.2% is about $2,290M, or $0.53 on the 4,279.8M average diluted shares of H1 2026. $71.36 divided by $3.18 is 22.4; divided by $2.65 is 26.9. Derived from C07, C09 and the pack's closing price of 23 September 2026.
against this
- The fee was taxed at whatever rate applied to it specifically, which Netflix does not disclose; the 18.2% blended half-year rate is an approximation and the true after-tax figure could differ by several cents a share.
- Netflix reports no adjusted earnings figure at all, so there is no company-stated 'ex-items' number to check this against - the restatement is entirely ours, and a reader taking Netflix's own GAAP presentation at face value would see only the $3.18.
- 2026-09-24editedRe-struck at the 2026-09-23 close of $71.36: the thesis's 12% drift trigger fired.
C06estimatemedium confidence
Management's 2026 guide of about 1.1 times cash content spend to amortisation, with amortisation up about 10%, implies second-half cash content spend of roughly $10.1B against $9.71B in H2 2025 - growth of about 4.0%, after 32.3% in the first half. Q3 added $5,159.8M, up 10.9% on $4,653.9M, so the fourth quarter has to come in near $4.94B, down about 2.4%.
against this
- Management pre-announced the shape in January 2026, before the year began: content amortisation growth would be higher in the first half than the second 'due to the timing of title launches', and operating income growth would therefore be higher in the second half. So a front-loaded first half is what was described, and the 4.0% is the arithmetic of a guide management may simply revise.
- The ratio is a rounded 'approximately 1.1x' and the amortisation growth a rounded 'approximately 10%'. At 1.15 times and 11% amortisation growth the implied second-half spend is about $11.2B, which is 15% growth rather than 4% - the sensitivity to two rounded inputs is large.
- 2026-10-20editedQ3 2026 additions to content assets grew 10.9%, above single digits; the guide now needs a fall of about 2.4% in Q4
C61estimatelow confidence
If advertising earned the company's guided 31.5% operating margin and 18.2% tax rate, the roughly $3B guided for 2026 would be about $0.8B of the roughly $12.6B of net profit the 2026 guide implies, leaving about $11.8B for the membership business. Netflix discloses no margin for advertising.
sourceNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primary
against this
A young ad business usually earns less than the company margin while it builds its sales team and ad technology, so the membership business may earn more than this and advertising less.
C20management claimmedium confidence
Netflix guides 2026 revenue of about $51.1B, up 13%, at a 31.5% operating margin, free cash flow of approximately $12.0B (cut from $12.5B, mainly for a real estate transaction expected to close in Q4) and advertising revenue of about $2.7B (cut from about $3B because some ad product capabilities rolled out slightly slower than expected).
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primary
against this
- The 20 October letter cut two of the four targets set in July: advertising from about $3B to about $2.7B, and free cash flow from $12.5B to $12.0B. Revenue is $51.1B against a July range of $51.0B-$51.4B, 0.2% below its mid-point, so only the margin target was held as written.
- The free-cash-flow cut is attributed to a real estate transaction, not to the operating business, but Netflix gives no figure for it, so how much of the $0.5B is operating is not disclosed.
- The implied Q4 operating margin is now 26.0%, including about 120 basis points from the headcount reductions; the nine-month 33.5% margin beat the quarterly forecasts mainly on the timing of expenses, which management itself says, so part of Q3's 34.6% is borrowed from Q4.
- 2026-10-20editedQ3 2026 letter of 20 October cut the advertising guide to about $2.7B and the free-cash-flow guide to $12.0B, and moved revenue to $51.1B; margin held at 31.5%
The company
Netflix sells one thing: a monthly subscription to an app that streams series, films and live events to any screen with an internet connection. It reports a single business and names no rival company in its annual report.
Most of what members watch, Netflix commissioned and owns. It carried $33.84B of shows and films on its books at June 2026, $10.31B of it still being made and not yet earning anything.
The evidence under this - 3 claims
C01facthigh confidence
Netflix operates as one reportable segment and says its revenue is derived primarily from monthly membership fees for streaming; FY2025 revenue was $45,183.0M.
C42facthigh confidence
Netflix's FY2025 10-K names no competitor by name anywhere in Item 1; it lists classes - linear television, streaming providers including pirate ones, video gaming providers, open content platform providers and social media.
C37facthigh confidence
Netflix carried $33,837.6M of content assets at 30 June 2026, of which $10,313.4M was in production and had earned nothing, and $24,039.2M of total content obligations at 31 December 2025 - $17.0B of which is not recognised on the balance sheet.
How it makes money
Members pay every month; revenue was $45.18B in 2025, up 15.9%. Advertising is new and small: over $1.5B in 2025, about 3.4% of revenue, and now guided to about $2.7B in 2026, cut from about $3B.
The big cost is shows, paid in cash as they are made and charged against profit over the years they are watched. When the cash runs ahead of the charge, reported profit looks better than the cash.
The evidence under this - 5 claims
C01facthigh confidence
Netflix operates as one reportable segment and says its revenue is derived primarily from monthly membership fees for streaming; FY2025 revenue was $45,183.0M.
C02facthigh confidence
FY2025 revenue was $45,183.0M, up 15.9%; operating income was $13,326.6M, a 29.5% margin against 26.7% in FY2024; net income was $10,981.2M.
C31factmedium confidence
FY2025 advertising revenue was over $1.5B, more than 2.5 times FY2024, in Netflix's third year of selling advertising; it was about 3.4% of FY2025 revenue.
C20management claimmedium confidence
Netflix guides 2026 revenue of about $51.1B, up 13%, at a 31.5% operating margin, free cash flow of approximately $12.0B (cut from $12.5B, mainly for a real estate transaction expected to close in Q4) and advertising revenue of about $2.7B (cut from about $3B because some ad product capabilities rolled out slightly slower than expected).
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primary
against this
- The 20 October letter cut two of the four targets set in July: advertising from about $3B to about $2.7B, and free cash flow from $12.5B to $12.0B. Revenue is $51.1B against a July range of $51.0B-$51.4B, 0.2% below its mid-point, so only the margin target was held as written.
- The free-cash-flow cut is attributed to a real estate transaction, not to the operating business, but Netflix gives no figure for it, so how much of the $0.5B is operating is not disclosed.
- The implied Q4 operating margin is now 26.0%, including about 120 basis points from the headcount reductions; the nine-month 33.5% margin beat the quarterly forecasts mainly on the timing of expenses, which management itself says, so part of Q3's 34.6% is borrowed from Q4.
- 2026-10-20editedQ3 2026 letter of 20 October cut the advertising guide to about $2.7B and the free-cash-flow guide to $12.0B, and moved revenue to $51.1B; margin held at 31.5%
C04facthigh confidence
FY2025 content amortisation charged against profit was $16,422.2M, against $17,096.6M of cash added to content assets - a ratio of 1.041 times, after 1.060 in FY2024 and 0.884 in FY2023.
Where the money comes from, stream by stream
| Stream | Share of sales (FY2025) | How it earns it |
|---|---|---|
| United States and Canada | 44.2% | Monthly memberships, with the advertising plan's ad sales inside the same regional figure. |
| Europe, Middle East and Africa | 32.1% | Monthly memberships priced country by country, plus advertising in the markets that carry the ad plan. |
| Latin America | 11.9% | Monthly memberships at lower local prices; reported growth trails the currency-neutral rate here most. |
| Asia-Pacific | 11.8% | Monthly memberships at the lowest prices of the four regions; China is not served. |
Who runs it
Ted Sarandos, who built Netflix's own shows, and Greg Peters, who ran its product, have shared the chief executive job since 2023; Spencer Neumann has run finance since 2019. Insiders own about 1%, much of it as options. Their yearly bonus rides on sales and profit margin, their shares on how the stock does against the market. Nothing pays on the cash spent making shows.
The evidence under this - 3 claims
C55facthigh confidence
Netflix's executive officers at 16 April 2026 were co-chief executives Ted Sarandos (co-chief executive since 2020, chief content officer 2000 to January 2023) and Greg Peters (co-chief executive since January 2023, at Netflix since 2008, chief product officer from 2017 and chief operating officer from 2020), chief financial officer Spencer Neumann (since January 2019), chief legal officer David Hyman and chief global affairs officer Clete Willems; co-founder Reed Hastings became non-executive chairman on 17 April 2025 and did not stand for re-election at the 2026 meeting.
C56facthigh confidence
At 6 April 2026 the 16 directors and executive officers as a group beneficially owned 52,413,364 shares, 1.24%, of which 27,326,326 were options; Reed Hastings held 37,759,062 including 16,595,546 options, the largest insider; Ted Sarandos held 5,719,962 including 5,380,770 options and Greg Peters 2,747,038 including 2,570,510. Netflix has one class of common stock.
C57facthigh confidence
Netflix's 2025 annual cash bonus, at a target of 200% of salary, paid on currency-neutral revenue (35%) and currency-neutral operating margin (65%) and paid out at 117.57% of target; long-term awards were half RSUs vesting quarterly over three years and half PSUs paying on three-year shareholder return against the S&P 500, with target at the 55th percentile; each co-chief executive's 2025 long-term target was $31.0M.
against this
- No metric pays on free cash flow or on cash spent on content, so the H1 2026 jump in content cash (C05) costs the bonus nothing while it lifts no reported margin.
- The 2024 PSUs' second tranche vested at 200% of target on a 92nd-percentile return to 2025, before the shares fell 41.9% over the following year (C43).
Why it wins, and who could beat it
Why customers come back
A series costs the same to make whether 10 million homes can watch it or 325 million. Netflix charged $16.42B of show costs against profit in 2025 and spread them across its whole base, so each home carries a fraction of what a smaller rival pays for a similar slate.
It shows in price. Netflix earns about $11.6 a month per membership against the $7.81 Disney reports for Disney+ worldwide: roughly 48% more, on a base more than twice as large.
The evidence under this - 4 claims
C03factmedium confidence
The last paid-membership figure Netflix published is from the Q4 2025 letter: it 'crossed the 325M paid memberships milestone during the quarter'. Quarterly membership reporting stopped in 2025.
C04facthigh confidence
FY2025 content amortisation charged against profit was $16,422.2M, against $17,096.6M of cash added to content assets - a ratio of 1.041 times, after 1.060 in FY2024 and 0.884 in FY2023.
C10facthigh confidence
Disney's FY2025 10-K reports Disney+ at 131.6M paid subscribers and average monthly revenue per paid subscriber of $7.81 worldwide for the year ended 27 September 2025, with Hulu at 64.1M and $12.36 for its subscription-only tier.
C11estimatemedium confidence
Netflix's FY2025 revenue of $45,183.0M over the 325M paid memberships it last reported is about $11.6 a month, roughly 48% above the $7.81 Disney reports for Disney+ worldwide.
derived$45,183.0M divided by 325M is $139.0 a year, or $11.58 a month. $11.58 divided by $7.81 is 1.48. The membership figure is a year-end milestone rather than an average, so the true per-member figure on an average base is slightly higher. Derived from C02, C03 and C10.
against this
- Netflix's base is a year-end 'crossed 325M' milestone and Disney's is a fiscal-year average, so the two denominators are not constructed the same way. Using an average Netflix base would widen the gap rather than narrow it, but the mismatch is real.
- Disney counts a bundle subscriber once for Disney+ and once for Hulu and allocates the revenue between them, which depresses the stated Disney+ figure relative to what the household actually pays Disney. A household paying for the Disney+/Hulu bundle is worth more to Disney than $7.81.
The threat
YouTube is the rival that matters. It fills the same evening hour on the same screen for no fee, earned $40.37B from advertising in 2025, and holds the largest share of American television time. Netflix's share has been below its year-earlier level two months running.
Warner Bros., which Netflix tried and failed to buy, is heading to Paramount Skydance, though a lawsuit holds the deal up.
The evidence under this - 5 claims
C12facthigh confidence
Alphabet's FY2025 10-K reports YouTube advertising revenue of $40,367M, up from $36,147M in 2024 and $31,510M in 2023 - 89% of Netflix's entire FY2025 revenue, from advertising alone.
C13facthigh confidence
Nielsen measured YouTube at a record 14.2% of United States television watch-time in July 2026, the largest share of any distributor and 5.0 points ahead of the second, against Netflix at 7.8%, level with FOX behind NBCUniversal-Versant and Disney.
against this
- The Media Distributor Gauge groups by company, so Disney's 8.9% and NBCU-Versant's 9.2% include broadcast and cable networks as well as streaming. Among streaming platforms alone Netflix is second, behind YouTube; Nielsen's July Gauge puts Disney's streaming services at 4.7%.
- July 2026 carried the final weeks of the FIFA World Cup on FOX and Telemundo, which lifted broadcast and Peacock; part of every other distributor's share loss that month is the tournament rather than a trend.
- Nielsen states that methodological updates to The Gauge will be implemented in autumn 2026, with back data provided, so the series is not guaranteed to remain consistent.
- 2026-09-24editedRe-sourced: its refresh trigger fired when Nielsen published the July 2026 Gauge on 10 September; YouTube rose to a record 14.2% and Netflix fell to 7.8%.
C15inferencemedium confidence
Netflix's measured share of United States television time is now below its year-earlier level in two consecutive months: Nielsen put it at 7.9% in June 2026 against 8.3% in June 2025 and 7.8% in July 2026 against 8.8% in July 2025, after 8.0% in May 2026 against 7.5% a year earlier.
sourceNielsen, The Gauge and Media Distributor Gauge, May 2026primaryNielsen, The Gauge and Media Distributor Gauge, June 2026primaryNielsen, The Gauge and Media Distributor Gauge, July 2026primaryNielsen, Media Distributor Gauge, June 2025primaryNielsen, Media Distributor Gauge, July and August 2025primary
against this
- June and July 2026 were distorted by the FIFA World Cup, which drove broadcast to its first June share increase since The Gauge began and lifted FOX and Peacock again in July; June and July 2025 had no tournament. Some of the year-over-year fall is the comparison rather than Netflix.
- Netflix's absolute viewing rose in June 2026; only its share did not. Nielsen's July text names no Netflix figure at all, so the 7.8% is read off its chart.
- Nielsen is changing the Gauge's method this autumn and says it will provide back data, so the next reading and the year-earlier figure it is compared with may both be restated.
- 2026-09-24editedRe-derived on the June and July 2026 Gauge charts and Nielsen's own 2025 releases: Netflix's share is now below its year-earlier level in two consecutive months, which the claim did not say before.
C07facthigh confidence
Warner Bros. Discovery terminated its amended merger agreement with Netflix on 27 February 2026 to accept Paramount Skydance, and Paramount Skydance paid Netflix a $2.8B termination fee on WBD's behalf, recorded in interest and other income in Q1 2026.
C29facthigh confidence
Warner Bros. Discovery's Q2 2026 10-Q says the Writers Guild of America West and East sued to block the Paramount Skydance merger under Section 7 of the Clayton Act, and that on 24 July 2026 defendants agreed not to complete it until the earlier of five days after a merits determination or 1 June 2027.
The rivals: GOOGL, GOOGL, PSKY, and 1 more that is private, in-house or listed abroad.
Who else does this, rival by rival
| Ticker | Rival | Where it competes | How far along | Priced against it |
|---|---|---|---|---|
| GOOGL | YouTube (Alphabet)Priced against it: Same product | Membership subscriptions | On sale | Same product |
| YouTube (Alphabet), for advertisers | Advertising on the ads plan | On sale | ||
| PSKY | HBO Max and the Warner Bros. film and television studios, under Paramount SkydancePriced against it: Same product | Membership subscriptions | Announced | Same product |
| Not listed | Piracy servicesPriced against it: Not listed | Membership subscriptions | On sale | Not listed |
How big it could get
How big this could get
There were 1,654 million fixed broadband connections in the world at the end of 2025, 669.8 million of them in China, where Netflix does not operate. If every other one paid what a Netflix member pays, that would be about $137B a year, against the $45.2B Netflix earned in 2025.
Streaming is now 49.0% of American television time and still rising, but YouTube, not Netflix, holds the largest share of it.
The evidence under this - 5 claims
C34factmedium confidence
The World Bank's ITU-sourced series counts 1,654 million fixed broadband subscriptions worldwide at end-2025, of which 669.8 million are in China, a market Netflix does not serve.
against this
- The China figure is a 2024 observation while the world total is 2025, so subtracting one from the other slightly overstates the non-China base.
- A fixed broadband subscription is not a household and not a television: it excludes the mobile-only households that are most of Netflix's remaining growth in Asia-Pacific and counts business connections that will never buy a subscription.
C11estimatemedium confidence
Netflix's FY2025 revenue of $45,183.0M over the 325M paid memberships it last reported is about $11.6 a month, roughly 48% above the $7.81 Disney reports for Disney+ worldwide.
derived$45,183.0M divided by 325M is $139.0 a year, or $11.58 a month. $11.58 divided by $7.81 is 1.48. The membership figure is a year-end milestone rather than an average, so the true per-member figure on an average base is slightly higher. Derived from C02, C03 and C10.
against this
- Netflix's base is a year-end 'crossed 325M' milestone and Disney's is a fiscal-year average, so the two denominators are not constructed the same way. Using an average Netflix base would widen the gap rather than narrow it, but the mismatch is real.
- Disney counts a bundle subscriber once for Disney+ and once for Hulu and allocates the revenue between them, which depresses the stated Disney+ figure relative to what the household actually pays Disney. A household paying for the Disney+/Hulu bundle is worth more to Disney than $7.81.
C02facthigh confidence
FY2025 revenue was $45,183.0M, up 15.9%; operating income was $13,326.6M, a 29.5% margin against 26.7% in FY2024; net income was $10,981.2M.
C35facthigh confidence
Nielsen measured streaming at 49.0% of total United States television watch-time in July 2026, against broadcast at 19.5% and cable at 18.7%, after 48.6% in May and 48.5% in June 2026.
sourceNielsen, The Gauge and Media Distributor Gauge, May 2026primaryNielsen, The Gauge and Media Distributor Gauge, June 2026primaryNielsen, The Gauge and Media Distributor Gauge, July 2026primary
- 2026-09-24editedRe-sourced: its refresh trigger fired with the July 2026 Gauge; streaming rose to 49.0%.
C13facthigh confidence
Nielsen measured YouTube at a record 14.2% of United States television watch-time in July 2026, the largest share of any distributor and 5.0 points ahead of the second, against Netflix at 7.8%, level with FOX behind NBCUniversal-Versant and Disney.
against this
- The Media Distributor Gauge groups by company, so Disney's 8.9% and NBCU-Versant's 9.2% include broadcast and cable networks as well as streaming. Among streaming platforms alone Netflix is second, behind YouTube; Nielsen's July Gauge puts Disney's streaming services at 4.7%.
- July 2026 carried the final weeks of the FIFA World Cup on FOX and Telemundo, which lifted broadcast and Peacock; part of every other distributor's share loss that month is the tournament rather than a trend.
- Nielsen states that methodological updates to The Gauge will be implemented in autumn 2026, with back data provided, so the series is not guaranteed to remain consistent.
- 2026-09-24editedRe-sourced: its refresh trigger fired when Nielsen published the July 2026 Gauge on 10 September; YouTube rose to a record 14.2% and Netflix fell to 7.8%.
Who has signed
Netflix is signing what YouTube built: creators such as Ms. Rachel and the Stokes Twins, video podcasts through iHeartMedia, and France's TF1 channels inside the subscription. It also has National Football League games at Thanksgiving and Christmas. None of these deals discloses a price or a term.
The evidence under this - 2 claims
C17facthigh confidence
Netflix has signed open-platform creators including Ms. Rachel, Mark Rober, Danny Go!, Salish & Jordan Matter, the Stokes Twins, Alan Chikin Chow, Nick DiGiovanni, Mythical and Sean Evans, video podcasts through iHeartMedia, lifestyle video from Conde Nast, Hearst and People, and carries TF1's channels inside the French subscription.
C52facthigh confidence
Netflix has an expanded agreement with the National Football League covering a week-one game in Q3 2026, a Thanksgiving Eve game and NFL Christmas Gameday in Q4 2026 and a final-week contest in Q1 2027, and will carry two Major League Baseball events and the Tyson Fury versus Anthony Joshua fight.
The results
The numbers
Is it growing?Steady
Sales grew 15% over the twelve months to Sep 2026, about the same pace as the 16% in the year to Dec 2025.
Is it profitable?Strong
Operating margin is 31%, up from 21% in the year to Dec 2023.
Does growth pay off?Pays off
Running costs take 19¢ of each sales dollar, down from 21¢ in the year to Dec 2021.
Does it earn good returns?Strong
Each dollar put into the business earns 31% a year after tax, up from 19% in the year to Dec 2021.
Is it making cash?Strong
It turned 23% of sales into free cash, $11.4B over the last twelve months.
Is the balance sheet safe?Light debt
It owes $6.91B more than the cash it holds, about 0.6 years of the cash its operations bring in.
Are shares being diluted?Shrinking
The share count fell 6.7% in 2.8 years, and pay in shares costs 1.1% of sales.
All the numbers
Filed figures from the company's 10-K and 10-Q, read 2026-10-21. Fiscal years end in December.
| Dec 2021 | Dec 2022 | Dec 2023 | Dec 2024 | Dec 2025 | 12 mo to Sep 2026 | |
|---|---|---|---|---|---|---|
| Size and growth | ||||||
| Sales | $29.7B | $31.6B | $33.7B | $39.0B | $45.2B | $49.7B |
| Sales growth | +19% | +6.5% | +6.7% | +16% | +16% | +15% |
| Profit | ||||||
| Gross margin | 42% | 39% | 42% | 46% | 48% | 51% |
| Operating margin | 21% | 18% | 21% | 27% | 29% | 31% |
| Net margin | 17% | 14% | 16% | 22% | 24% | 30% |
| What growth costs, per sales dollar | ||||||
| Research and development | 7.7% | 8.6% | 7.9% | 7.5% | 7.5% | 7.8% |
| Sales and marketing | 8.6% | 8.0% | 7.9% | 7.5% | 7.3% | 7.3% |
| General and admin | 4.6% | 5.0% | 5.1% | 4.4% | 4.2% | 4.3% |
| Pay in shares | 1.4% | 1.8% | 1.0% | 0.7% | 0.8% | 1.1% |
| Capital spending | 1.8% | 1.3% | 1.0% | 1.1% | 1.5% | 1.9% |
| Cash | ||||||
| Cash from operations | $393M | $2.03B | $7.27B | $7.36B | $10.1B | $12.3B |
| Free cash flow | −$132M | $1.62B | $6.93B | $6.92B | $9.46B | $11.4B |
| Balance sheet | ||||||
| Cash and short-term investments | $6.06B | $6.08B | $7.14B | $9.58B | $9.06B | $8.22B |
| Debt | $15.4B | $14.4B | $14.5B | $15.6B | $14.5B | $15.1B |
| Net cash | −$9.34B | −$8.27B | −$7.40B | −$6.00B | −$5.40B | −$6.91B |
| Returns and shares | ||||||
| Return on capital | 19% | 14% | 17% | 24% | 28% | 31% |
| Shares (diluted) | - | - | 4.49B | 4.39B | 4.34B | 4.20B |
What growth costs
Growth has made Netflix more profitable: each new dollar of sales costs less in shows charged against profit, while technology, marketing and admin stay a steady slice. The catch is cash: this year it is paying for shows faster than it charges them, so the profit gain is ahead of the cash.
The evidence under this - 2 claims
C54facthigh confidence
Per sales dollar, cost of revenues fell from 60.6 cents in FY2022 to 51.5 in FY2025 and 50.9 over the four quarters to June 2026, while technology and development (the line Netflix tags as research and development, the same figure) moved from 8.6 to 7.5 and 7.7 cents, marketing from 8.0 to 7.3 and 7.4, general and administrative from 5.0 to 4.2 and 4.4, and stock pay from 1.8 to 0.8 and 1.0; operating margin rose from 17.8% to 29.5% and 29.7%.
sourceNetflix Form 10-K, fiscal year ended 31 December 2024primaryNetflix Form 10-K, fiscal year ended 31 December 2025primaryNetflix Form 10-Q, quarter ended 30 June 2026primary
against this
- Cash added to content assets grew 32.3% in H1 2026 against 11.4% for the amortisation charged to cost of revenues (C05), so the income-statement leverage is running ahead of the cash.
- Stock pay per sales dollar rose from 0.7 cents in FY2024 to 1.0 over the four quarters to June 2026 (C41).
C05facthigh confidence
In H1 2026 Netflix added $9,774.4M of cash to content assets, up 32.3% on H1 2025's $7,385.5M, while the amortisation charged against profit was $8,529.2M, up 11.4% on $7,655.2M.
The last report (16 Jul)
Quarter ended June 2026, filed figures.
13%
Sales growth
against the same quarter a year earlier
2.5%
Growth from the quarter before
against 1.7% the quarter before that
33¢
Operating profit
per dollar of sales
The September quarter landed where it was promised: revenue up 11.8%, with 34.6 cents of each dollar kept as operating profit, helped by the timing of expenses. Cash added to shows rose 10.9%, still faster than revenue.
Netflix then cut its advertising target for 2026 to about $2.7B from about $3B, and its free-cash-flow target to $12.0B from $12.5B, mostly for a property sale. It kept its 31.5% margin target.
What it did to the thesisThe print split our test. Revenue and margin met the bar, but show spending grew faster than hoped and two targets were cut. Nothing in the case broke, and it is closer to its advertising warning line, so the view stays Neutral.
The quarter in detail
Sales growth from the previous quarter, filed figures.
Earnings per share $0.80 against $0.79 expected; $0.80 as filed, with no adjustments.
The evidence under this - 4 claims
C63facthigh confidence
Netflix's Q3 2026 revenue was $12,874M, up 11.8% (11% excluding currency), down from 13.4% in Q2; operating margin was 34.6% against 28.2% a year earlier, ahead of its forecast mainly because of the timing of expenses; diluted EPS was $0.87. Additions to content assets were $5,159.8M, up 10.9%, and nine-month additions $14,934.2M, up 24.0%.
- 2026-10-21editedThe Q3 call landed after the 20 October review and was read; the search note no longer says management commentary is unread
C20management claimmedium confidence
Netflix guides 2026 revenue of about $51.1B, up 13%, at a 31.5% operating margin, free cash flow of approximately $12.0B (cut from $12.5B, mainly for a real estate transaction expected to close in Q4) and advertising revenue of about $2.7B (cut from about $3B because some ad product capabilities rolled out slightly slower than expected).
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primary
against this
- The 20 October letter cut two of the four targets set in July: advertising from about $3B to about $2.7B, and free cash flow from $12.5B to $12.0B. Revenue is $51.1B against a July range of $51.0B-$51.4B, 0.2% below its mid-point, so only the margin target was held as written.
- The free-cash-flow cut is attributed to a real estate transaction, not to the operating business, but Netflix gives no figure for it, so how much of the $0.5B is operating is not disclosed.
- The implied Q4 operating margin is now 26.0%, including about 120 basis points from the headcount reductions; the nine-month 33.5% margin beat the quarterly forecasts mainly on the timing of expenses, which management itself says, so part of Q3's 34.6% is borrowed from Q4.
- 2026-10-20editedQ3 2026 letter of 20 October cut the advertising guide to about $2.7B and the free-cash-flow guide to $12.0B, and moved revenue to $51.1B; margin held at 31.5%
C21management claimmedium confidence
Management guides 2026 content amortisation up about 10% and a cash content spend to amortisation ratio of about 1.1 times, a guide it repeated on 20 October; it told investors in January 2026 that amortisation growth would be front-loaded into the first half.
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 earnings call, question sectionprimary
against this
- The comparable FY2025 outturn was 1.041 times, so the guide is already a step up before the H1 2026 outturn of 1.146 times is considered.
- On the Q2 2026 call Ted Sarandos framed the same guide as discipline - 'we grow the content spend slower than revenue' - while describing content expense, the amortisation line, and not the cash. Both statements are true and only one of them is what leaves the bank.
- After nine months the ratio is 1.17 times ($14,934.2M added against $12,764.7M amortised), so holding the full-year 1.1 times needs fourth-quarter additions of about $4.94B, 2.4% below the fourth quarter of 2025 ($5,057.2M derived from FY2025 and nine-month cash flows).
- 2026-10-20editedQ3 2026 letter repeats the 1.1 times guide; nine-month ratio is 1.17 times, so the fourth quarter has to fall
C06estimatemedium confidence
Management's 2026 guide of about 1.1 times cash content spend to amortisation, with amortisation up about 10%, implies second-half cash content spend of roughly $10.1B against $9.71B in H2 2025 - growth of about 4.0%, after 32.3% in the first half. Q3 added $5,159.8M, up 10.9% on $4,653.9M, so the fourth quarter has to come in near $4.94B, down about 2.4%.
against this
- Management pre-announced the shape in January 2026, before the year began: content amortisation growth would be higher in the first half than the second 'due to the timing of title launches', and operating income growth would therefore be higher in the second half. So a front-loaded first half is what was described, and the 4.0% is the arithmetic of a guide management may simply revise.
- The ratio is a rounded 'approximately 1.1x' and the amortisation growth a rounded 'approximately 10%'. At 1.15 times and 11% amortisation growth the implied second-half spend is about $11.2B, which is 15% growth rather than 4% - the sensitivity to two rounded inputs is large.
- 2026-10-20editedQ3 2026 additions to content assets grew 10.9%, above single digits; the guide now needs a fall of about 2.4% in Q4
What management did with the money
It bought back 66.8 million shares for $6.02B in the first half, at about $90 each. Earlier it had lined up $42.2B of borrowing to buy Warner Bros. for cash; the deal fell through, and Netflix collected a $2.8B break fee.
Insiders in 2026Q2: 62 purchases and 59 sales, from their Form 4 filings.
The evidence under this - 3 claims
C25facthigh confidence
Netflix repurchased 66,832,533 shares for $6,015.0M in H1 2026, an average of about $90.00 a share, of which $4,705.7M came in Q2 2026 - its largest repurchase quarter - with about $27.1B of authorisation left.
C28facthigh confidence
Netflix arranged $34B of bridge facility commitments for the Warner Bros. acquisition and raised them by $8.2B to $42.2B on 19 January 2026 when the deal became all cash at $27.75 a WBD share, and paused its share buyback to accumulate cash for it.
C07facthigh confidence
Warner Bros. Discovery terminated its amended merger agreement with Netflix on 27 February 2026 to accept Paramount Skydance, and Paramount Skydance paid Netflix a $2.8B termination fee on WBD's behalf, recorded in interest and other income in Q1 2026.
The price, and where we disagree
In short. Fair for a good business. Not cheap: last year's profit and this year's cash are both lifted by a one-off fee, so the real price is higher than it first looks.
Share price
$71.36
close,
Price for each $1 of yearly profit
22.2
its 6-year normal 41.7
The shares were already far below their high, so price is not the obvious objection; cash is. Management's guide still needs show spending to fall about 2.4% in the fourth quarter after rising 10.9% in the third. The next test is the full-year report in January.
The evidence under this - 4 claims
C43facthigh confidence
The shares closed at $71.36 on 23 September 2026, down 41.9% over 252 sessions and 42.8% below the 252-day high of $124.86, with a trailing price of about 22.2 times earnings against a six-year median of 41.7.
- 2026-09-24editedRe-read from the research pack of 2026-09-24 (close of 2026-09-23): the refresh trigger 'the next research pack' fired.
C06estimatemedium confidence
Management's 2026 guide of about 1.1 times cash content spend to amortisation, with amortisation up about 10%, implies second-half cash content spend of roughly $10.1B against $9.71B in H2 2025 - growth of about 4.0%, after 32.3% in the first half. Q3 added $5,159.8M, up 10.9% on $4,653.9M, so the fourth quarter has to come in near $4.94B, down about 2.4%.
against this
- Management pre-announced the shape in January 2026, before the year began: content amortisation growth would be higher in the first half than the second 'due to the timing of title launches', and operating income growth would therefore be higher in the second half. So a front-loaded first half is what was described, and the 4.0% is the arithmetic of a guide management may simply revise.
- The ratio is a rounded 'approximately 1.1x' and the amortisation growth a rounded 'approximately 10%'. At 1.15 times and 11% amortisation growth the implied second-half spend is about $11.2B, which is 15% growth rather than 4% - the sensitivity to two rounded inputs is large.
- 2026-10-20editedQ3 2026 additions to content assets grew 10.9%, above single digits; the guide now needs a fall of about 2.4% in Q4
C21management claimmedium confidence
Management guides 2026 content amortisation up about 10% and a cash content spend to amortisation ratio of about 1.1 times, a guide it repeated on 20 October; it told investors in January 2026 that amortisation growth would be front-loaded into the first half.
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 earnings call, question sectionprimary
against this
- The comparable FY2025 outturn was 1.041 times, so the guide is already a step up before the H1 2026 outturn of 1.146 times is considered.
- On the Q2 2026 call Ted Sarandos framed the same guide as discipline - 'we grow the content spend slower than revenue' - while describing content expense, the amortisation line, and not the cash. Both statements are true and only one of them is what leaves the bank.
- After nine months the ratio is 1.17 times ($14,934.2M added against $12,764.7M amortised), so holding the full-year 1.1 times needs fourth-quarter additions of about $4.94B, 2.4% below the fourth quarter of 2025 ($5,057.2M derived from FY2025 and nine-month cash flows).
- 2026-10-20editedQ3 2026 letter repeats the 1.1 times guide; nine-month ratio is 1.17 times, so the fourth quarter has to fall
C63facthigh confidence
Netflix's Q3 2026 revenue was $12,874M, up 11.8% (11% excluding currency), down from 13.4% in Q2; operating margin was 34.6% against 28.2% a year earlier, ahead of its forecast mainly because of the timing of expenses; diluted EPS was $0.87. Additions to content assets were $5,159.8M, up 10.9%, and nine-month additions $14,934.2M, up 24.0%.
- 2026-10-21editedThe Q3 call landed after the 20 October review and was read; the search note no longer says management commentary is unread
The betSafe, little upside
If it works
0.9×
from today's value, at the stated multiple
If it fails
keep 79%
of today's market value: the rest of the company, less its debt
How we read the multiple
Buyers pay about 22 times last year's profit, far below Netflix's usual 42. But about $0.53 a share of that profit was the $2.8B fee it collected when its Warner Bros. deal fell through. Without it, the price is about 27 times.
On Netflix's own forecast for 2026 it is about 24 times, so a buyer still needs growth beyond 2026, though less than in August. The same fee explains most of this year's raised cash forecast; underlying cash is near the $11B first forecast.
Against its own history. Far cheaper than its own normal on every measure. That normal was set while it grew faster and before YouTube pulled ahead, so part of the gap is earned.
The evidence under this - 4 claims
C27estimatemedium confidence
At $71.36 the equity is about $304B and enterprise value about $309B, so Netflix's own 2026 guide of about $16.1B of operating profit and about $12.6B of net profit puts the price at about $24 for each $1 of net profit and about $19 of enterprise value for each $1 of operating profit.
derived4,261.3M Q2 2026 diluted shares at $71.36 is $304.1B; plus $14,309.3M of debt less $9,127.9M of cash is $309.3B. The $51.2B revenue mid-point at the guided 31.5% margin is $16,128M of operating profit; less H1 2026 interest expense of $437.8M doubled, plus about $200M of other income, taxed at H1's 18.2%, is about $12,640M, or $2.98 on about 4,240M shares. Derived from C20, C24 and C26 and the pack's closing price of 23 September 2026.
against this
- It runs entirely on management's own guide, which is a management claim and not a filed figure. If the 31.5% margin is missed by one point the net figure falls about $420M and the multiple rises by about 0.8.
- The pack's own trailing figure is 22.2 times earnings against a six-year median of 41.7, so on the comparison a screen actually makes the shares look far cheaper than this frame does. Both are true and they differ because one is trailing and reported and the other forward and guided.
- Analysts' consensus earnings of $4.55 for 2028 and $6.46 for 2030 would put the same price at 15.7 and 11.0 times, so the frame is demanding only if growth beyond 2026 disappoints those estimates.
- 2026-09-24editedRe-struck at the 2026-09-23 close of $71.36: the thesis's 12% drift trigger fired. The consensus figures in the counter-evidence are re-read from the new pack.
C08estimatemedium confidence
Trailing diluted earnings per share of $3.18 include about $0.53 from the termination fee after tax, so at $71.36 the price is about $27 for each $1 of profit excluding the fee against about $22 including it.
derivedFiled diluted EPS of $0.59, $0.56, $1.23 and $0.80 for Q3 2025 to Q2 2026 sum to $3.18. The $2.8B fee taxed at the H1 2026 effective rate of 18.2% is about $2,290M, or $0.53 on the 4,279.8M average diluted shares of H1 2026. $71.36 divided by $3.18 is 22.4; divided by $2.65 is 26.9. Derived from C07, C09 and the pack's closing price of 23 September 2026.
against this
- The fee was taxed at whatever rate applied to it specifically, which Netflix does not disclose; the 18.2% blended half-year rate is an approximation and the true after-tax figure could differ by several cents a share.
- Netflix reports no adjusted earnings figure at all, so there is no company-stated 'ex-items' number to check this against - the restatement is entirely ours, and a reader taking Netflix's own GAAP presentation at face value would see only the $3.18.
- 2026-09-24editedRe-struck at the 2026-09-23 close of $71.36: the thesis's 12% drift trigger fired.
C22facthigh confidence
FY2025 operating cash flow was $10,149.3M and free cash flow $9.5B, against $7,361.4M and $6.9B in FY2024; the 2026 free-cash-flow guide was 'roughly $11B' in January 2026 and 'approximately $12.5B' in July 2026.
C23inferencemedium confidence
The $1.5B increase in the 2026 free-cash-flow guide is close to the $2.8B termination fee net of the cash tax paid on it, so underlying 2026 free cash flow is near the roughly $11B guided before the fee arrived.
derivedJanuary's guide of roughly $11B predates the 27 February 2026 termination; July's is approximately $12.5B, a $1.5B move. The Q2 2026 letter attributes part of that quarter's cash-flow fall to 'higher cash tax payments due in part to the Warner Bros. termination fee'. Derived from C07, C20 and C22.
against this
- The two guides are eleven weeks and two quarters apart and other things moved in between: the roughly $700M Brazilian deposit landed in 2026, currency moved, and the guide is stated to one decimal place. Attributing the whole $1.5B to the fee net of tax is a reconciliation, not a disclosure.
- Netflix never states the cash tax paid on the fee, so the split between the fee and everything else is inferred rather than known.
Priced against its rivals
There is no group to price it against. No cohort, so the only comparison left is against Netflix's own history - where the trailing figure is flattered by a break fee the six-year median never contained. The price is judged against its own history instead.
The bet: what it pays if it works
The bet is on advertising sold to viewers of the cheaper plan. Netflix still calls it too small to report and gives no profit for it, so the membership business is counted separately, at the price per dollar of profit this thesis calls fair and no more.
Counted that way, memberships alone keep most of today's price. If advertising keeps growing fast it adds a little, but not enough to beat the price; if YouTube keeps the advertisers, little is lost.
| Advertising on the ads plan revenue in two to three years | Monthly ads-plan viewers needed | At the stated multiple |
|---|---|---|
| $4.50B | about 375.0M at 100% kept | 0.9× |
| $6.00B (the big win) | about 500.0M at 100% kept | 0.9× |
| $9.00B | about 750.0M at 100% kept | 0.9× |
To pay 2× (a Fair bet) it would need about $69.42B of Advertising on the ads plan revenue (about 5.8B monthly ads-plan viewers); to pay 5× (a Cheap bet), about $241.63B of Advertising on the ads plan revenue (about 20.1B monthly ads-plan viewers), at the same multiple.
Each row is Advertising on the ads plan alone, plus the rest of the company (Membership subscriptions) counted at about $236.00B.
The steps it has to take
- Done Advertising above $1.5B in a year
- Done Ads plan above 250 million monthly viewers
- Slipped About $3B of advertising in 2026 (guide cut to about $2.7B) due 2026-12
- Not started Advertising near $6B a year, material enough to report due 2028-12
The detail behind the label
Rating
Expensive
the big win's payoff against the 2× and 5× lines
Cheap bet at about
$12.78
82% below the price (close, )
The option
0.5×
what Advertising on the ads plan is worth if it works, against what the price pays for it
The evidence under this - 6 claims
C20management claimmedium confidence
Netflix guides 2026 revenue of about $51.1B, up 13%, at a 31.5% operating margin, free cash flow of approximately $12.0B (cut from $12.5B, mainly for a real estate transaction expected to close in Q4) and advertising revenue of about $2.7B (cut from about $3B because some ad product capabilities rolled out slightly slower than expected).
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primary
against this
- The 20 October letter cut two of the four targets set in July: advertising from about $3B to about $2.7B, and free cash flow from $12.5B to $12.0B. Revenue is $51.1B against a July range of $51.0B-$51.4B, 0.2% below its mid-point, so only the margin target was held as written.
- The free-cash-flow cut is attributed to a real estate transaction, not to the operating business, but Netflix gives no figure for it, so how much of the $0.5B is operating is not disclosed.
- The implied Q4 operating margin is now 26.0%, including about 120 basis points from the headcount reductions; the nine-month 33.5% margin beat the quarterly forecasts mainly on the timing of expenses, which management itself says, so part of Q3's 34.6% is borrowed from Q4.
- 2026-10-20editedQ3 2026 letter of 20 October cut the advertising guide to about $2.7B and the free-cash-flow guide to $12.0B, and moved revenue to $51.1B; margin held at 31.5%
C31factmedium confidence
FY2025 advertising revenue was over $1.5B, more than 2.5 times FY2024, in Netflix's third year of selling advertising; it was about 3.4% of FY2025 revenue.
C60management claimmedium confidence
At its May 2026 upfront Netflix told advertisers its ads plan reaches more than 250 million global monthly active viewers, up from the 190 million it cited in November 2025. The measure is Netflix's own: members who watched at least a minute of ads in a month, times an estimated household size.
against this
A viewer count multiplied by a household estimate is not a paying account; part of the rise is the change from monthly active users to monthly active viewers, and no third party measures it.
C61estimatelow confidence
If advertising earned the company's guided 31.5% operating margin and 18.2% tax rate, the roughly $3B guided for 2026 would be about $0.8B of the roughly $12.6B of net profit the 2026 guide implies, leaving about $11.8B for the membership business. Netflix discloses no margin for advertising.
sourceNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primary
against this
A young ad business usually earns less than the company margin while it builds its sales team and ad technology, so the membership business may earn more than this and advertising less.
C27estimatemedium confidence
At $71.36 the equity is about $304B and enterprise value about $309B, so Netflix's own 2026 guide of about $16.1B of operating profit and about $12.6B of net profit puts the price at about $24 for each $1 of net profit and about $19 of enterprise value for each $1 of operating profit.
derived4,261.3M Q2 2026 diluted shares at $71.36 is $304.1B; plus $14,309.3M of debt less $9,127.9M of cash is $309.3B. The $51.2B revenue mid-point at the guided 31.5% margin is $16,128M of operating profit; less H1 2026 interest expense of $437.8M doubled, plus about $200M of other income, taxed at H1's 18.2%, is about $12,640M, or $2.98 on about 4,240M shares. Derived from C20, C24 and C26 and the pack's closing price of 23 September 2026.
against this
- It runs entirely on management's own guide, which is a management claim and not a filed figure. If the 31.5% margin is missed by one point the net figure falls about $420M and the multiple rises by about 0.8.
- The pack's own trailing figure is 22.2 times earnings against a six-year median of 41.7, so on the comparison a screen actually makes the shares look far cheaper than this frame does. Both are true and they differ because one is trailing and reported and the other forward and guided.
- Analysts' consensus earnings of $4.55 for 2028 and $6.46 for 2030 would put the same price at 15.7 and 11.0 times, so the frame is demanding only if growth beyond 2026 disappoints those estimates.
- 2026-09-24editedRe-struck at the 2026-09-23 close of $71.36: the thesis's 12% drift trigger fired. The consensus figures in the counter-evidence are re-read from the new pack.
C12facthigh confidence
Alphabet's FY2025 10-K reports YouTube advertising revenue of $40,367M, up from $36,147M in 2024 and $31,510M in 2023 - 89% of Netflix's entire FY2025 revenue, from advertising alone.
Where we disagree with the market
The market believes
A great business sold off for slowing growth and thinner disclosure. Most analysts still rate it a buy.
We believe
The fall is roughly deserved: a fair price for a good business whose reported profit and cash have started to separate.
The two numbers sit where nobody reads them together: the break fee inside other income, and show spending inside the cash-flow statement. Netflix is also publishing less: membership counts stopped in 2025, and viewing figures go annual from 2027.
We are wrong if show spending falls about 2.4% in the fourth quarter, free cash lands at $12.0B, and advertising reaches its cut $2.7B target.
What analysts say, and the evidence
Analysts positive
67%
of 52, 1 Sep
Four months earlier
72%
of 51, 1 May
The evidence under this - 7 claims
C44factmedium confidence
The analyst panel the research pack aggregates stands at 63 buy, 30 hold and 7 sell, with no strong sells, and its consensus label is Buy.
- 2026-09-24editedRe-read from the research pack of 2026-09-24: one more sell rating than on 25 August.
C07facthigh confidence
Warner Bros. Discovery terminated its amended merger agreement with Netflix on 27 February 2026 to accept Paramount Skydance, and Paramount Skydance paid Netflix a $2.8B termination fee on WBD's behalf, recorded in interest and other income in Q1 2026.
C05facthigh confidence
In H1 2026 Netflix added $9,774.4M of cash to content assets, up 32.3% on H1 2025's $7,385.5M, while the amortisation charged against profit was $8,529.2M, up 11.4% on $7,655.2M.
C03factmedium confidence
The last paid-membership figure Netflix published is from the Q4 2025 letter: it 'crossed the 325M paid memberships milestone during the quarter'. Quarterly membership reporting stopped in 2025.
C19facthigh confidence
From 2027 Netflix will publish its What We Watched view-hours report annually in the first quarter rather than twice a year, and will no longer publish it alongside earnings.
C06estimatemedium confidence
Management's 2026 guide of about 1.1 times cash content spend to amortisation, with amortisation up about 10%, implies second-half cash content spend of roughly $10.1B against $9.71B in H2 2025 - growth of about 4.0%, after 32.3% in the first half. Q3 added $5,159.8M, up 10.9% on $4,653.9M, so the fourth quarter has to come in near $4.94B, down about 2.4%.
against this
- Management pre-announced the shape in January 2026, before the year began: content amortisation growth would be higher in the first half than the second 'due to the timing of title launches', and operating income growth would therefore be higher in the second half. So a front-loaded first half is what was described, and the 4.0% is the arithmetic of a guide management may simply revise.
- The ratio is a rounded 'approximately 1.1x' and the amortisation growth a rounded 'approximately 10%'. At 1.15 times and 11% amortisation growth the implied second-half spend is about $11.2B, which is 15% growth rather than 4% - the sensitivity to two rounded inputs is large.
- 2026-10-20editedQ3 2026 additions to content assets grew 10.9%, above single digits; the guide now needs a fall of about 2.4% in Q4
C20management claimmedium confidence
Netflix guides 2026 revenue of about $51.1B, up 13%, at a 31.5% operating margin, free cash flow of approximately $12.0B (cut from $12.5B, mainly for a real estate transaction expected to close in Q4) and advertising revenue of about $2.7B (cut from about $3B because some ad product capabilities rolled out slightly slower than expected).
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primary
against this
- The 20 October letter cut two of the four targets set in July: advertising from about $3B to about $2.7B, and free cash flow from $12.5B to $12.0B. Revenue is $51.1B against a July range of $51.0B-$51.4B, 0.2% below its mid-point, so only the margin target was held as written.
- The free-cash-flow cut is attributed to a real estate transaction, not to the operating business, but Netflix gives no figure for it, so how much of the $0.5B is operating is not disclosed.
- The implied Q4 operating margin is now 26.0%, including about 120 basis points from the headcount reductions; the nine-month 33.5% margin beat the quarterly forecasts mainly on the timing of expenses, which management itself says, so part of Q3's 34.6% is borrowed from Q4.
- 2026-10-20editedQ3 2026 letter of 20 October cut the advertising guide to about $2.7B and the free-cash-flow guide to $12.0B, and moved revenue to $51.1B; margin held at 31.5%
What could go wrong, and how we would know
The risks
- YouTube keeps winning the evening. Netflix's share of American television time was below a year earlier in June and July 2026.
- Show spending outruns revenue. Cash spent on shows rose 32.3% in the first half against revenue up 14.7%.
- American growth slowing. Growth in the United States and Canada fell from 18% to 14% to 10% over the last three quarters.
- Another big acquisition. In January it lined up $42.2B of borrowing to buy a single studio.
- Less to check. Membership counts are gone for good, and viewing figures move to once a year from 2027.
The evidence under this - 7 claims
C15inferencemedium confidence
Netflix's measured share of United States television time is now below its year-earlier level in two consecutive months: Nielsen put it at 7.9% in June 2026 against 8.3% in June 2025 and 7.8% in July 2026 against 8.8% in July 2025, after 8.0% in May 2026 against 7.5% a year earlier.
sourceNielsen, The Gauge and Media Distributor Gauge, May 2026primaryNielsen, The Gauge and Media Distributor Gauge, June 2026primaryNielsen, The Gauge and Media Distributor Gauge, July 2026primaryNielsen, Media Distributor Gauge, June 2025primaryNielsen, Media Distributor Gauge, July and August 2025primary
against this
- June and July 2026 were distorted by the FIFA World Cup, which drove broadcast to its first June share increase since The Gauge began and lifted FOX and Peacock again in July; June and July 2025 had no tournament. Some of the year-over-year fall is the comparison rather than Netflix.
- Netflix's absolute viewing rose in June 2026; only its share did not. Nielsen's July text names no Netflix figure at all, so the 7.8% is read off its chart.
- Nielsen is changing the Gauge's method this autumn and says it will provide back data, so the next reading and the year-earlier figure it is compared with may both be restated.
- 2026-09-24editedRe-derived on the June and July 2026 Gauge charts and Nielsen's own 2025 releases: Netflix's share is now below its year-earlier level in two consecutive months, which the claim did not say before.
C05facthigh confidence
In H1 2026 Netflix added $9,774.4M of cash to content assets, up 32.3% on H1 2025's $7,385.5M, while the amortisation charged against profit was $8,529.2M, up 11.4% on $7,655.2M.
C18facthigh confidence
Netflix members watched 97 billion hours in H1 2026, up 2% year over year against 1.5% growth in 2025, while H1 2026 revenue of $24,810M was up 14.7%.
C33facthigh confidence
Revenue growth in the United States and Canada fell from 18% in Q4 2025 to 14% in Q1 2026 and 10% in Q2 2026, on a currency-neutral basis identical to the reported one.
against this
- The Q2 2026 letter says the 10% 'reflects only a partial quarter impact from our recent price change, which has gone well and as expected', so part of the deceleration is the timing of a price increase inside the quarter rather than demand.
- Latin America accelerated over the same three quarters, from 15% to 19% to 21% reported, so the deceleration is not global.
C28facthigh confidence
Netflix arranged $34B of bridge facility commitments for the Warner Bros. acquisition and raised them by $8.2B to $42.2B on 19 January 2026 when the deal became all cash at $27.75 a WBD share, and paused its share buyback to accumulate cash for it.
C03factmedium confidence
The last paid-membership figure Netflix published is from the Q4 2025 letter: it 'crossed the 325M paid memberships milestone during the quarter'. Quarterly membership reporting stopped in 2025.
C19facthigh confidence
From 2027 Netflix will publish its What We Watched view-hours report annually in the first quarter rather than twice a year, and will no longer publish it alongside earnings.
What we still do not know
- Whether the first half's jump in show spending was timing, as management said in January, or a new level.
- How many members it has now. It stopped reporting the number at 325 million.
The evidence under this - 4 claims
C05facthigh confidence
In H1 2026 Netflix added $9,774.4M of cash to content assets, up 32.3% on H1 2025's $7,385.5M, while the amortisation charged against profit was $8,529.2M, up 11.4% on $7,655.2M.
C21management claimmedium confidence
Management guides 2026 content amortisation up about 10% and a cash content spend to amortisation ratio of about 1.1 times, a guide it repeated on 20 October; it told investors in January 2026 that amortisation growth would be front-loaded into the first half.
sourceNetflix Q3 2026 Letter to Shareholders (Exhibit 99.1 to the…primaryNetflix Q4 2025 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 shareholder letter (Form 8-K, Exhibit 99.1)primaryNetflix Q2 2026 earnings call, question sectionprimary
against this
- The comparable FY2025 outturn was 1.041 times, so the guide is already a step up before the H1 2026 outturn of 1.146 times is considered.
- On the Q2 2026 call Ted Sarandos framed the same guide as discipline - 'we grow the content spend slower than revenue' - while describing content expense, the amortisation line, and not the cash. Both statements are true and only one of them is what leaves the bank.
- After nine months the ratio is 1.17 times ($14,934.2M added against $12,764.7M amortised), so holding the full-year 1.1 times needs fourth-quarter additions of about $4.94B, 2.4% below the fourth quarter of 2025 ($5,057.2M derived from FY2025 and nine-month cash flows).
- 2026-10-20editedQ3 2026 letter repeats the 1.1 times guide; nine-month ratio is 1.17 times, so the fourth quarter has to fall
C48management claimhigh confidence
In January 2026, before the year began, Netflix told investors content amortisation growth would be higher in the first half of 2026 than the second because of title-launch timing, and that operating income growth would therefore be higher in the second half.
against this
- The same guide puts the full year at a 31.5% operating margin against H1 2026's actual 32.8%, so the second half must run below the first. 'Higher operating income growth in the second half' is therefore arithmetic about a weak prior-year base - H2 2025 carried a Q3 at 28.2% and a Q4 at 24.5% - rather than a claim about a better second half.
- The statement is about the amortisation charge and says nothing about the cash. It does not explain, and management has never been asked about, the 32.3% growth in cash added to content assets in the same half.
C03factmedium confidence
The last paid-membership figure Netflix published is from the Q4 2025 letter: it 'crossed the 325M paid memberships milestone during the quarter'. Quarterly membership reporting stopped in 2025.
What would change our view
- Neutral→AttractiveContent spend stays disciplined while advertising lands
It needs all of:
- ○Cash spent on shows grows no faster than revenue for four quarters running, and the operating margin widens over a full year.checked at the next results, due by 31 Jan
- ○Advertising revenue reaches the roughly $3B management promised for 2026.checked at the next results, due by 31 Jan
- Neutral→UnattractiveThe strategy consumes the cash or the audience
It needs any of:
- ○Netflix spends more than a year's free cash on buying a studio.watched as it happens
- ○Netflix's share of American television time falls below a year earlier for three readings running.checked at the next results, due by 31 Jan
We would also be wrong if
- Show spending grows faster than revenue for four quarters running.
- Advertising finishes 2026 well below $3B.
What is coming
- 25 November 2026 NFL Thanksgiving Eve game: Whether live sport keeps producing sign-up peaks and advertising demand for the price live costs.
Every dated event ahead
- 25 November 2026 NFL Thanksgiving Eve game: Whether live sport keeps producing sign-up peaks and advertising demand for the price live costs.
- 25 December 2026 NFL Christmas Gameday: The second large live test of the quarter; a weak night would question the live spending inside the content budget.
- January 2027 Q4 2026 results and the 2027 outlook: Whether fourth-quarter content cash falls about 2.4% to fit the 1.1 times ratio, free cash flow reaches $12.0B, and advertising reaches $2.7B.
- 1 June 2027 Paramount Skydance and Warner Bros. Discovery merger deadline: Whether the largest rival library combination closes or the writers' lawsuit stops it; either sets who Netflix bids against for shows.
Since we wrote this
Written
25 Aug
Price the thesis read
$71.36
23 Sep
- 21 OctEarningsThe call explained the advertising cut and moved nothingManagement blamed slower ad product rollout and partner integrations, repeated the full-year guide and gave no new number. The fourth quarter still decides it.
- 20 OctEarningsSales grew 11.8%; advertising and cash targets were cutRevenue and margin met the bar, but show spending grew faster than hoped and two targets were cut. The view held, with the advertising line closer.
- 14 OctNewsNetflix cuts about 6% of staff and reportedly keeps its full-year forecast. View heldNetflix cut about 1,000 jobs, roughly 6% of staff, six days before its third-quarter results.
- 11 OctThesis reviewAdvertising declared an early line, with a bet on itThe owner asked every thesis to name the lines its story rides; advertising is half the first reconsider path and is not reported apart.
- 5 OctThesis reviewThe long case now sits under the verdictAfter the five-name pilot, the owner asked for the long case on every thesis.
- 4 OctThesis reviewOwner's checklist: revenue streams, cost of growth, management, catalystsThe owner's checklist found the method silent on who runs the company, what growth costs, where the money comes from and what is dated ahead; this pass fills those four blocks from the proxy and filings.
- 24 SepNewsTelevision share below a year earlier again. View heldNielsen's July figures put Netflix's share of American television time below its year-earlier level for a second month; a third would fire a route. The price claims were re-struck after a 13.2% fall.
- 25 AugThesis writtenNeutral, medium convictionA good business whose fall in the shares is roughly deserved: YouTube is winning television time, and cash spent on shows has run ahead of the cost charged to profit.
Also checked 8 times with nothing new to act on.
Sources 23
Where this came from
Sources - 23
Every claim above cites one of these, or states the reasoning that derived it. The quote is frozen at the date it was read: a link can rot, and an agent fetch returns a reading of a page rather than the page. Backs counts the whole claim ledger, so it can name a claim this page does not surface.
- S01primarycompany filing2026-01-23Item 1 business and the competition classes, the single-segment statement, FY2025 revenue and operating income, the regional revenue table, the three-year cash flow statement with content additions against amortisation, the content-obligations maturity ladder, the piracy risk factor, the revolving facility and the 4,222,162,150 share countbacksC01C02C04C16C22C24C26C32C37C42C51C53C54C58
- S02primarycompany filing2026-01-20the last paid-membership figure of 325M, FY2025 advertising revenue over $1.5B at more than 2.5 times, the original 2026 guide including roughly $11B of free cash flow and about $275M of acquisition expenses, the Nielsen 9.0% December citation, the $42.2B bridge commitments and the all-cash $27.75 WBD terms, the buyback pause, and the January statement that content amortisation growth would be front-loadedbacksC03C14C20C21C22C26C28C31C47C48C49C61
- S03primarycompany filing2026-07-16the quarterly series to Q2 2026 and the Q3 guide, the narrowed 2026 revenue range and the approximately $12.5B free-cash-flow guide, the 1.1 times cash-to-amortisation ratio, the regional growth table, 97 billion H1 view hours at 2%, the view-hours disclosure change, the creator and publisher signings, the TF1 partnership, the NFL slate, and the record $4.7B buyback quarterbacksC09C17C18C19C20C21C22C25C33C38C39C46C50C52C61C62
- S04primarycompany filing2026-07-17the Warner Bros. termination note and the $2.8B fee in interest and other income, the H1 cash flow statement with content additions of $9,774.4M against amortisation of $8,529.2M, the balance sheet and treasury-stock movement, the debt note, the $587M March acquisition, the $729M Brazilian tax payments, stock-based compensation, and the 4,163,939,676 share countbacksC05C07C09C18C24C25C26C30C37C39C41C46C47C49C54
- S05primarytranscript2026-07-16the addressable-market claims, the live versus animation spend and view-hour comparison, the per-hour price claim, the games market size, the generative-AI cost claim, and sixteen analyst questions including the deceleration, second-season viewing, free trials, bundling and the 'primarily builders, not buyers' answer on capital allocation
We are less than 45% penetrated into households around the world. It is roughly 800 million addressable households. Capturing, you know, we think just 7% of addressable revenue market. It is about $670 billion of addressable revenue in the countries and categories in which we operate today. We estimate that we are only about 5% of TV viewing share globally.
backsC21C36C38C45C50 - S06primarycompany filing2026-08-06Warner Bros. Discovery Form 10-Q, quarter ended 30 June 2026 Warner Bros. Discoverythe counterparty's own record of the Netflix merger, its termination and the $2,800M fee; the Clayton Act challenge and the 24 July 2026 standstill to the earlier of five days after a merits determination or 1 June 2027; the merger termination fees; and the Streaming segment's Q2 2026 revenue and adjusted earningsbacksC07C29C30
- S07primarycompany filing2026-02-05YouTube advertising revenue of $40,367M for 2025, $36,147M for 2024 and $31,510M for 2023, and the revenue-disaggregation note confirming the line excludes YouTube subscription revenuebacksC12
- S08primarycompany filing2025-11-13The Walt Disney Company Form 10-K, fiscal year ended 27 September 2025 The Walt Disney CompanyDisney+ at 131.6M paid subscribers and $7.81 average monthly revenue per paid subscriber worldwide, Hulu at 64.1M and $12.36, and the definitions behind both - the only outside measure of what a household pays a scaled generalist rivalbacksC10
- S09primaryindustry data2026-07-28the measured distributor shares of United States television watch-time, streaming at 48.6% against broadcast 19.2% and cable 20.4%, and the note that methodological updates arrive in autumn 2026
Streaming usage appeared to begin its summer ascent in May as audiences' time spent streaming increased to 48.6% of total TV watch-time (+1.0 pt.) … YouTube recorded a platform-best 13.8% of TV watch-time in May to maintain the largest share of television among all distributors for a third consecutive month. … Netflix moved back into the No. 4 slot in the Media Distributor Gauge, representing 8.0% of TV usage in May (+0.2 pts.). … Broadcast and cable viewing exhibited typical April-to-May declines, finishing at 19.2% and 20.4% of TV watch-time, respectively. … The May 2026 interval spanned five weeks, from 04/27/2026 through 05/31/2026.
backsC15C35 - S10primaryindustry data2026-08-18the second consecutive month of YouTube at 13.8%, streaming easing to 48.5% as the World Cup lifted broadcast, and the counter-evidence that Netflix's absolute viewing rose while its share did not
Overall streaming usage was up about 3% compared to May, but due to it being just below the 3.1% increase for total TV usage, the category dropped back 0.1 share point to 48.5% of TV watch-time. … several other streamers also saw monthly viewing increases, including YouTube, Netflix, The Roku Channel and Paramount Streaming … but similar to the overall streaming category, their shares were flat or down slightly. However, YouTube remained in the lead among media distributors with 13.8% of time spent. … The June 2026 interval spanned four weeks, from 06/01/2026 through 06/28/2026.
backsC15C35 - S11primarygovernment data2026-07-13World Bank World Development Indicators, ITU indicator IT.NET.BBND - fixed broadband subscriptions World Bankthe base for the prize - 1,654 million fixed broadband subscriptions worldwide at end-2025, and 669,825,900 in China for 2024, counted by somebody with no interest in the answer
Fixed broadband subscriptions refers to fixed subscriptions to high-speed access to the public Internet (a TCP/IP connection), at downstream speeds equal to, or greater than, 256 kbit/s. This includes cable modem, DSL, fiber-to-the-home/building, other fixed (wired)-broadband subscriptions, satellite broadband and terrestrial fixed wireless broadband. … "countryiso3code":"WLD","date":"2025","value":1654000000 … "country":{"id":"CN","value":"China"},"countryiso3code":"CHN","date":"2024","value":669825900
backsC34 - S12primarycompany filing2025-01-27the prior year's Competition section and competition risk factor, which is what makes the FY2025 promotion of 'open content platform providers' visible as a change rather than a standing descriptionbacksC16C54
- S13primarycompany filing2026-08-10the transaction code rather than the aggregate: code S, an open-market sale of 9,248 shares at $75.7901, leaving 73,787 held directly, with no derivative table and no explanation of responsesbacksC40
- S14primarycompany filing2026-07-22the size, coupon and maturity of the July 2026 issue, which confirms the refinancing described in the Q2 letter rather than new leveragebacksC39
- S15secondaryvendor data2026-09-24Frozen research pack, content/NFLX/research-pack.json (close of 23 September 2026)content/NFLX/research-pack.jsonthe closing price and the 252-day return and range position, the trailing multiples against their six-year medians, the analyst panel, the volatility bucket, the insider and congressional filings, the earnings history and the theme co-movement readingbacksC40C43C44
- S16secondarynews2026-08-25Filtered news digest, data/cache/news/NFLX.jsondata/cache/news/NFLX.jsonfour key developments from 250 articles: the July print and the two-year low, the Pershing Square stake, the advertising leadership change, and the Barron's creator-bidding argument - plus the headlines that evidence what the common view actually isread, but no claim rests on it
- S17primaryindustry data2026-09-10the July 2026 distributor shares, the June 2026 Netflix share of 7.9% from the chart the June release carries, streaming at 49.0%, and Nielsen's note that the Gauge's method changes this autumn with back data
YouTube viewing rose 6% month-over-month to bring the streamer's share of TV to a record 14.2%, and extending its lead in the Media Distributor Gauge to 5.0 share points. … the category climbed to 49.0% of total TV (+0.5 pts.). … Broadcast finished the month with a 19.5% share of TV (-0.3 pts.). … the category represented 18.7% of TV in July. … The July 2026 interval spanned four weeks, from 06/29/2026 through 07/26/2026. [Media Distributor Gauge chart, July 2026: YouTube 14.2%, NBCUniversal + Versant 9.2%, Disney 8.9%, Netflix 7.8%, FOX 7.8%.] [June 2026 chart on the same page: Netflix 7.9%, YouTube 13.8%.]
backsC13C15C35 - S18primaryindustry data2025-07-15the June 2025 Netflix share of 8.3%, and May 2025's 7.5% by subtracting the 0.8 points added
Netflix posted the largest monthly share-increase across all media companies this month, adding 0.8 points from May to represent 8.3% of June's TV usage total and its largest share of television since January 2025.
backsC15 - S19primaryindustry data2025-09-23the July 2025 Netflix share of 8.8% and the August 2025 share of 8.7%, the year-earlier comparisons for the two readings after June
Netflix maintained its ranking among the top three media distributors this month by adding half a share point over June to finish with 8.8% of TV. [August 2025 release, https://www.nielsen.com/news-center/2025/disney-and-fox-gain-turf-in-august-as-footballs-return-kicks-off-seasonal-shifts-according-to-nielsen/, 23 September 2025:] Netflix held steady in third with 8.7% of television (-0.1 point)
backsC15 - S20primarycompany filing2026-04-16beneficial ownership as of 6 April 2026 with each insider's options, the executive officers and their tenure, Reed Hastings leaving the executive role and the board, and the CD&A: bonus metrics and weights, the 2025 payout, the PSU and RSU designbacksC55C56C57
- S21secondarynews2026-05-14Netflix's own reach figure for the ads plan, as reported from its upfront; the newsroom post could not be found and no filing carries it
reaches more than 250 million global monthly active viewers, up from the 190 million it cited in November of 2025
backsC60C62 - S22primarycompany filing2026-10-20Q3 2026 revenue, operating margin, additions to and amortisation of content assets for the quarter and nine months, free cash flow, buybacks, debt and cash, and the updated 2026 guide for revenue, margin, free cash flow and advertisingbacksC06C20C21C63
- S23primarytranscript2026-10-20the advertising shortfall's cause (delayed rollout and partner integrations) and the 80% growth rate, the repeat of full-year guidance, the 2027 revenue and margin objectives, the churn and price-rise read, and the content-chief change
We are currently a bit behind our aggressive target for the year. We are still growing, just to set the context or put this in perspective. We are still growing our ads business over 80% this year.
backsC64