Netflix Inc (NFLX)
Profitability ratios
Return on sales
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross profit margin | 41.54% | 39.49% | 38.77% | 38.30% | 39.37% | 39.62% | 40.63% | 41.62% | 41.64% | 43.22% | 42.29% | 41.10% | 38.89% | 38.80% | 38.98% | 38.47% | 38.28% | 37.98% | 36.81% | 36.58% |
| Operating profit margin | 20.62% | 18.35% | 17.51% | 16.85% | 17.82% | 18.16% | 19.13% | 20.41% | 20.86% | 22.76% | 22.03% | 21.17% | 18.34% | 17.17% | 16.59% | 14.50% | 12.92% | 12.51% | 10.56% | 9.74% |
| Pretax margin | 18.40% | 15.57% | 14.97% | 14.90% | 16.65% | 18.35% | 18.74% | 19.03% | 19.67% | 20.24% | 18.11% | 16.82% | 12.80% | 11.93% | 13.23% | 11.49% | 10.23% | 10.77% | 7.93% | 7.98% |
| Net profit margin | 16.04% | 13.82% | 13.22% | 13.16% | 14.21% | 16.03% | 16.42% | 16.47% | 17.23% | 17.64% | 15.92% | 14.24% | 11.05% | 11.78% | 11.85% | 10.43% | 9.26% | 7.49% | 6.53% | 7.61% |
Netflix Inc.'s profitability ratios, based on the provided data, reflect its ability to generate profits relative to its revenue and operating costs. The gross profit margin, which measures the percentage of revenue retained after accounting for the cost of goods sold, ranged from 38.30% to 41.54% over the last eight quarters, with a slight decrease in recent quarters.
The operating profit margin, representing the proportion of revenue remaining after deducting operating expenses, also experienced some fluctuations, averaging around 18% and peaking at 20.41% in Mar 31, 2022. However, it declined to 16.85% by Mar 31, 2023, indicating potential cost management challenges.
Moreover, the pretax margin, indicating the proportion of each dollar of revenue that translates to pre-tax profit, ranged from 14.90% to 19.03% during the same period. The net profit margin, which reveals the proportion of revenue that translates to net income, fluctuated between 13.16% and 16.47% over the past eight quarters.
Overall, the declining trend in these profitability margins in recent quarters suggests that Netflix may be facing challenges in managing costs and maximizing profitability, warranting further analysis to understand the underlying factors contributing to these trends.
Return on investment
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 14.27% | 12.14% | 11.07% | 10.86% | 11.59% | 12.02% | 12.81% | 13.69% | 13.89% | 15.25% | 14.83% | 13.92% | 11.67% | 10.59% | 10.10% | 8.85% | 7.67% | 7.63% | 6.17% | 5.94% |
| Return on assets (ROA) | 11.10% | 9.14% | 8.36% | 8.49% | 9.24% | 10.61% | 10.99% | 11.05% | 11.48% | 11.82% | 10.72% | 9.37% | 7.03% | 7.27% | 7.21% | 6.37% | 5.49% | 4.57% | 3.82% | 4.65% |
| Return on total capital | 19.88% | 16.08% | 14.91% | 15.18% | 16.99% | 18.89% | 19.69% | 20.40% | 21.63% | 21.82% | 20.06% | 18.80% | 14.76% | 13.87% | 15.04% | 13.88% | 12.03% | 13.53% | 10.29% | 11.25% |
| Return on equity (ROE) | 26.27% | 20.47% | 18.60% | 19.24% | 21.62% | 24.57% | 26.71% | 28.54% | 32.28% | 32.98% | 31.68% | 29.18% | 24.96% | 27.16% | 28.73% | 26.54% | 24.62% | 20.61% | 18.86% | 22.18% |
Netflix Inc.'s profitability ratios have shown fluctuations over the past eight quarters. The operating return on assets (Operating ROA) has ranged from 10.86% to 14.27% during this period, indicating the company's ability to generate operating income from its assets. Meanwhile, return on assets (ROA) ranged from 8.36% to 11.10%, reflecting the overall profitability of the company's assets.
The return on total capital, which measures the overall effectiveness of investment in the company, fluctuated between 14.82% and 19.79%. This suggests that the company has been able to generate favorable returns from its total capital employed over the periods.
Netflix's return on equity (ROE) ranged from 18.60% to 28.54%, indicating the company's ability to generate a profit from shareholders' equity. Overall, these profitability ratios reflect Netflix's ability to generate earnings relative to its assets, capital, and equity, albeit with some fluctuations in performance over the analyzed periods.