Netflix Inc (NFLX)
Debt-to-capital ratio
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 13,798,400 | 14,143,400 | 14,353,100 | 14,693,100 | 15,809,100 |
| Total stockholders’ equity | US$ in thousands | 24,743,600 | 20,588,300 | 20,777,400 | 15,849,200 | 11,065,200 |
| Debt-to-capital ratio | 0.36 | 0.41 | 0.41 | 0.48 | 0.59 |
December 31, 2024 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $13,798,400K ÷ ($13,798,400K + $24,743,600K)
= 0.36
The debt-to-capital ratio of Netflix Inc has shown a decreasing trend over the past five years, declining from 0.59 in December 2020 to 0.36 in December 2024. This suggests that the company has been successful in reducing its reliance on debt financing relative to its total capital structure. A lower debt-to-capital ratio indicates a healthier financial position as it implies a lower proportion of debt in relation to total capital, which can reduce financial risk and increase financial flexibility. The downward trend in the ratio reflects positively on Netflix's ability to manage its debt levels effectively and potentially improve its overall financial stability.