Netflix Inc (NFLX)
Pretax margin
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Earnings before tax but after interest (EBT) | US$ in thousands | 6,205,400 | 5,263,930 | 5,840,100 | 3,199,350 | 2,062,230 |
| Revenue | US$ in thousands | 33,723,300 | 31,615,600 | 29,697,800 | 24,996,100 | 20,156,400 |
| Pretax margin | 18.40% | 16.65% | 19.67% | 12.80% | 10.23% |
December 31, 2023 calculation
Pretax margin = EBT ÷ Revenue
= $6,205,400K ÷ $33,723,300K
= 18.40%
The pretax margin of Netflix Inc. has shown a consistent improvement over the past five years, indicating the company's increasing efficiency in generating profits before accounting for taxes. The pretax margin has grown from 10.23% in 2019 to 18.40% in 2023. This suggests that Netflix has been able to effectively control its operating expenses and overhead costs while growing its revenue, resulting in higher profitability. The upward trend in pretax margin reflects the company's ability to maintain strong financial performance and enhance shareholder value. Overall, this indicator demonstrates Netflix's capacity to manage its pre-tax profitability and operational efficiency.