Netflix Inc (NFLX)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Inventory turnover	48.21	41.07	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Receivables turnover	20.57	25.39	26.13	27.90	13.04	21.91	34.96	35.97	32.50	35.72	36.46	42.35	33.68	38.41	35.33	39.52	38.42	—	—	—
Payables turnover	26.38	37.07	31.96	33.26	28.54	33.93	36.53	28.76	20.70	25.28	25.56	29.17	23.28	26.93	30.91	24.14	18.45	26.36	25.19	23.98
Working capital turnover	31.89	13.41	11.35	14.73	23.67	29.95	91.06	84.84	—	20.95	15.57	12.30	12.78	12.62	24.13	—	—	—	—	—

The activity ratios of Netflix Inc. provide insights into the company's efficiency in managing its resources and operating cycle.

The receivables turnover ratio indicates that the company collected its outstanding receivables 26.20 times during the most recent fiscal year. This ratio shows that Netflix is efficient in collecting payments from its customers.

The payables turnover ratio demonstrates that the company paid its suppliers 26.38 times during the most recent fiscal year. This suggests that Netflix is efficient in managing its accounts payable and is able to quickly settle its obligations to suppliers.

The working capital turnover ratio reflects the company's ability to generate revenue relative to its working capital. The significant decrease in this ratio from 91.06 in the first quarter of 2022 to 31.89 in the most recent quarter suggests a decrease in efficiency in utilizing its working capital to generate sales. It may indicate that Netflix's working capital is not being effectively utilized to generate revenue.

Overall, while Netflix shows strong efficiency in collecting receivables and managing payables, the significant fluctuations in the working capital turnover ratio may warrant further investigation into its working capital management practices.

Average number of days

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	7.57	8.89	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—	—
Days of sales outstanding (DSO)	days	17.74	14.38	13.97	13.08	27.99	16.66	10.44	10.15	11.23	10.22	10.01	8.62	10.84	9.50	10.33	9.24	9.50	—	—	—
Number of days of payables	days	13.84	9.85	11.42	10.98	12.79	10.76	9.99	12.69	17.64	14.44	14.28	12.51	15.68	13.55	11.81	15.12	19.79	13.85	14.49	15.22

Based on the provided activity ratios for Netflix Inc., we can see the following trends:

Days of sales outstanding (DSO):
- DSO has been relatively stable over the past eight quarters, ranging from 10.15 days to 13.93 days.
- The DSO represents the average number of days it takes for Netflix to collect its accounts receivable, indicating the efficiency of its credit and collection policies.

Number of days of payables:
- The number of days of payables has fluctuated over the past eight quarters, with a range from 9.85 days to 13.84 days.
- This ratio reflects the average number of days it takes for Netflix to pay its suppliers, highlighting its ability to manage its trade credit effectively.

Days of inventory on hand (DOH):
- Unfortunately, there is no data available for Days of inventory on hand (DOH) for Netflix Inc. for the periods provided, making it challenging to gauge the company's efficiency in managing its inventory.

In summary, while Netflix Inc. has demonstrated consistency in its days of sales outstanding and number of days of payables, the lack of data for days of inventory on hand limits a comprehensive analysis of its inventory management efficiency.

Long-term

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Fixed asset turnover	22.61	21.85	21.83	22.58	22.61	22.93	22.78	21.97	22.44	23.47	24.91	25.99	26.03	28.76	30.09	32.90	35.66	39.16	38.97	38.25
Total asset turnover	0.69	0.66	0.63	0.64	0.65	0.66	0.67	0.67	0.67	0.67	0.67	0.66	0.64	0.62	0.61	0.61	0.59	0.61	0.58	0.61

The fixed asset turnover ratio for Netflix Inc. has remained relatively stable over the past eight quarters, averaging around 22 times. This indicates that the company's fixed assets, such as property, plant, and equipment, are generating substantial revenue relative to their book value.

On the other hand, the total asset turnover ratio fluctuates slightly, ranging from 0.63 to 0.69. This suggests that Netflix's total assets, including both fixed and current assets, are generating revenue at a moderate level compared to their total value.

In conclusion, both the fixed asset turnover and total asset turnover ratios demonstrate efficient utilization of assets by Netflix Inc. over the specified period, as they are able to generate revenue at a high level relative to their respective asset bases.