Netflix Inc (NFLX)
Debt-to-capital ratio
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | ||
|---|---|---|---|---|---|---|
| Long-term debt | US$ in thousands | 14,143,400 | 14,353,100 | 14,693,100 | 15,809,100 | 14,759,300 |
| Total stockholders’ equity | US$ in thousands | 20,588,300 | 20,777,400 | 15,849,200 | 11,065,200 | 7,582,160 |
| Debt-to-capital ratio | 0.41 | 0.41 | 0.48 | 0.59 | 0.66 |
December 31, 2023 calculation
Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $14,143,400K ÷ ($14,143,400K + $20,588,300K)
= 0.41
The debt-to-capital ratio of Netflix Inc. has shown a decreasing trend from 0.66 in 2019 to 0.41 in 2023. This indicates that the company has been effectively reducing its reliance on debt in relation to its total capital over the years. A declining debt-to-capital ratio is generally viewed positively by investors and creditors, as it suggests a lower risk of financial distress and greater financial stability. The trend suggests that Netflix has been managing its capital structure efficiently, possibly by using more equity financing relative to debt financing. This could also imply improved creditworthiness and financial flexibility for the company.