Netflix Inc (NFLX)
Working capital turnover
| Dec 31, 2024 | Sep 30, 2024 | Jun 30, 2024 | Mar 31, 2024 | 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 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue (ttm) | US$ in thousands | 39,000,950 | 37,587,270 | 36,304,240 | 34,932,230 | 33,723,290 | 32,742,520 | 32,126,440 | 31,909,280 | 31,615,550 | 31,472,820 | 31,030,700 | 30,402,340 | 29,697,850 | 28,632,970 | 27,585,140 | 26,391,650 | 24,996,060 | 23,819,050 | 22,628,310 | 21,403,140 |
| Total current assets | US$ in thousands | 13,100,400 | 12,129,100 | 9,615,550 | 9,921,310 | 9,918,130 | 10,779,500 | 11,506,300 | 10,482,600 | 9,266,470 | 8,816,900 | 7,840,780 | 8,098,020 | 8,069,820 | 9,415,790 | 9,604,280 | 10,107,500 | 9,761,580 | 9,826,480 | 8,564,140 | 6,447,780 |
| Total current liabilities | US$ in thousands | 10,755,400 | 10,707,100 | 10,140,000 | 9,289,220 | 8,860,660 | 8,338,720 | 8,675,800 | 8,316,070 | 7,930,970 | 7,765,920 | 7,500,020 | 7,739,660 | 8,488,970 | 8,049,250 | 7,832,890 | 7,961,770 | 7,805,780 | 7,939,800 | 7,626,420 | 7,853,720 |
| Working capital turnover | 16.63 | 26.43 | — | 55.26 | 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 | — |
December 31, 2024 calculation
Working capital turnover = Revenue (ttm) ÷ (Total current assets – Total current liabilities)
= $39,000,950K ÷ ($13,100,400K – $10,755,400K)
= 16.63
The working capital turnover ratio provides insight into how efficiently Netflix Inc is utilizing its working capital to generate revenue. The ratio is calculated by dividing total revenue by the average working capital during a specific period. A higher ratio indicates that the company is effectively using its working capital to generate sales.
Based on the data provided:
- In the second quarter of 2020, the working capital turnover ratio was 24.13, showing that Netflix was highly efficient in utilizing its working capital during that period.
- The ratio decreased in the following quarters but remained above 10, indicating a reasonable level of efficiency in working capital management.
- There was a significant spike in efficiency in the first quarter of 2022, with a working capital turnover ratio of 84.84, suggesting a substantial increase in revenue generation relative to working capital.
- The ratio fluctuated in the subsequent periods but generally maintained at levels above 10, indicating overall efficient use of working capital.
Overall, the working capital turnover ratio for Netflix Inc demonstrates varying levels of efficiency in utilizing working capital to generate revenue over the reported periods. The company shows a pattern of maintaining efficiency in working capital turnover, with occasional spikes indicating particularly effective periods.