Netflix Inc (NFLX)
Solvency ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt-to-assets ratio | 0.26 | 0.27 | 0.25 | 0.27 | 0.29 | 0.28 | 0.28 | 0.28 | 0.30 | 0.29 | 0.31 | 0.32 | 0.33 | 0.35 | 0.36 | 0.37 | 0.40 | 0.40 | 0.41 | 0.40 |
| Debt-to-capital ratio | 0.36 | 0.38 | 0.36 | 0.38 | 0.41 | 0.39 | 0.38 | 0.39 | 0.41 | 0.40 | 0.43 | 0.45 | 0.48 | 0.49 | 0.52 | 0.54 | 0.59 | 0.60 | 0.62 | 0.63 |
| Debt-to-equity ratio | 0.56 | 0.62 | 0.55 | 0.62 | 0.69 | 0.63 | 0.62 | 0.64 | 0.69 | 0.68 | 0.75 | 0.83 | 0.93 | 0.97 | 1.08 | 1.15 | 1.43 | 1.50 | 1.64 | 1.69 |
| Financial leverage ratio | 2.17 | 2.30 | 2.22 | 2.29 | 2.37 | 2.24 | 2.23 | 2.27 | 2.34 | 2.32 | 2.43 | 2.58 | 2.81 | 2.79 | 2.96 | 3.11 | 3.55 | 3.74 | 3.98 | 4.17 |
Netflix Inc's solvency ratios show a positive trend over the years, indicating a strong financial position. The Debt-to-assets ratio has decreased steadily from 0.40 in March 2020 to 0.26 by December 2024, implying the company has been reducing its reliance on debt to finance its assets. The Debt-to-capital ratio also shows a decreasing trend, declining from 0.63 in March 2020 to 0.36 by December 2024. This suggests that Netflix has been able to decrease its debt relative to its total capital over the period.
Furthermore, the Debt-to-equity ratio has shown a consistent decline from 1.69 in March 2020 to 0.56 in December 2024, indicating the company's ability to reduce its debt in relation to its equity. This trend reflects a stronger financial structure and lower financial risk for the company.
Additionally, the Financial leverage ratio has decreased from 4.17 in March 2020 to 2.17 by December 2024, highlighting Netflix's reduced reliance on debt to support its operations and investments. Overall, the solvency ratios of Netflix Inc demonstrate a positive trajectory, signaling a sound financial position and effective management of debt levels over the years.
Coverage ratios
| 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 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Interest coverage | 14.79 | 13.80 | 12.83 | 11.52 | 9.87 | 8.33 | 7.95 | 7.86 | 8.45 | 8.97 | 8.83 | 8.62 | 8.63 | 8.49 | 7.41 | 6.71 | 5.17 | 4.80 | 5.21 | 4.64 |
The interest coverage ratio for Netflix Inc has shown a consistent improvement over the years, indicating the company's ability to cover its interest expenses with operating income. The ratio has increased steadily from 4.64 as of March 31, 2020, to 14.79 as of December 31, 2024. This signifies a positive trend in the company's financial health and its ability to meet its interest obligations comfortably.
The upward trajectory in the interest coverage ratio suggests that Netflix's operating profits have been more than sufficient to cover its interest expenses during the period under review. This improved financial performance may indicate effective management of costs, increased revenue generation, and overall operational efficiency.
Investors, creditors, and stakeholders may view this trend positively as it reflects a lower financial risk for the company in terms of its debt obligations. A higher interest coverage ratio provides a cushion for the company in times of financial stress or economic downturns, as it signifies a stronger ability to service its debt.
Overall, the increasing interest coverage ratio of Netflix Inc signals a positive financial outlook and a strong ability to manage debt obligations through its operational performance.