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Netflix Operating Margin %

: 19.80% (As of Jun. 2022)
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Operating Margin % is calculated as Operating Income divided by its Revenue. Netflix's Operating Income for the three months ended in Jun. 2022 was $1,578 Mil. Netflix's Revenue for the three months ended in Jun. 2022 was $7,970 Mil. Therefore, Netflix's Operating Margin % for the quarter that ended in Jun. 2022 was 19.80%.

Good Sign:

Netflix Inc operating margin is expanding. Margin expansion is usually a good sign.

The historical rank and industry rank for Netflix's Operating Margin % or its related term are showing as below:

NFLX' s Operating Margin % Range Over the Past 10 Years
Min: 1.39   Med: 7.24   Max: 20.86
Current: 19.13


NFLX's Operating Margin % is ranked better than
86.89% of 1007 companies
in the Media - Diversified industry
Industry Median: 4.45 vs NFLX: 19.13

Netflix's 5-Year Average Operating Margin % Growth Rate was 36.80% per year.

Netflix's Operating Income for the three months ended in Jun. 2022 was $1,578 Mil. Its Operating Income for the trailing twelve months (TTM) ended in Jun. 2022 was $5,937 Mil.


Netflix Operating Margin % Historical Data

The historical data trend for Netflix's Operating Margin % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Netflix Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Operating Margin %
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 7.17 10.16 12.92 18.34 20.86

Netflix Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Operating Margin % Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 25.17 23.46 8.19 25.06 19.80

Competitive Comparison

For the Entertainment subindustry, Netflix's Operating Margin %, along with its competitors' market caps and Operating Margin % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Netflix Operating Margin % Distribution

For the Media - Diversified industry and Communication Services sector, Netflix's Operating Margin % distribution charts can be found below:

* The bar in red indicates where Netflix's Operating Margin % falls into.



Netflix Operating Margin % Calculation

Operating Margin % - also known as operating income margin, operating profit margin and return on sales (ROS) - is the ratio of Operating Income divided by net sales or Revenue, usually presented in percent.

Netflix's Operating Margin % for the fiscal year that ended in Dec. 2021 is calculated as

Operating Margin %=Operating Income (A: Dec. 2021 ) / Revenue (A: Dec. 2021 )
=6194.509 / 29697.844
=20.86 %

Netflix's Operating Margin % for the quarter that ended in Jun. 2022 is calculated as

Operating Margin %=Operating Income (Q: Jun. 2022 ) / Revenue (Q: Jun. 2022 )
=1578.283 / 7970.141
=19.80 %

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Netflix  (NAS:NFLX) Operating Margin % Explanation

Just like Gross Margin %, it is important to see a company maintains its operating margin over time. Among the same industry, a company with higher operating margin is more efficient in its operation. It is also more stable during industry slowdown or recessions. Peter Lynch prefers those with higher margins than those with lower margins.


Be Aware

Operating Margin % can be manipulated by adjusting the rate of depreciation, depletion and amortization (DDA).

If a company is facing competition, its Operating Margin % may decline. Often the Operating Margin % declines well before the company's Revenue or even profit decline. Therefore, Operating Margin % is a very important indicator of whether the company is facing problems.

For instance, by 2012, Nokia (NOK)'s problems were well known and its stock had lost more than 90% of its market value since 2007. But Nokia’s Operating Margin % had already been in decline since 2002, although its Earnings per Share (Diluted) were still rising. Investors who paid attention to Operating Margin % would have avoided this huge loss. The same can be said for Research-in-Motion (RIMM).

Therefore, Operating Margin % is a very important screening filter for GuruFocus. GuruFocus's Buffett-Munger screener requires that the profit margin is either consistent or expanding. The Model Portfolio of the Buffett-Munger screener has outperformed the market every year since inception in 2009.


Netflix Operating Margin % Related Terms

Thank you for viewing the detailed overview of Netflix's Operating Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.


Netflix Business Description

Netflix logo
Address
100 Winchester Circle, Los Gatos, CA, USA, 95032
Netflix's primary business is a streaming video on demand service now available in almost every country worldwide except China. Netflix delivers original and third-party digital video content to PCs, Internet-connected TVs, and consumer electronic devices, including tablets, video game consoles, Apple TV, Roku, and Chromecast. In 2011, Netflix introduced DVD-only plans and separated the combined streaming and DVD plans, making it necessary for subscribers who want both to have separate plans.
Executives
Lee Dicus Marian officer: Chief Marketing Officer 526 WEST 111TH STREET APARTMENT 3C NEW YORK NY 10025
Hoag Jay C director 250 MIDDLEFIELD ROAD MENLO PARK CA 94025
Ezama Meabe Sergio officer: Chief Talent Officer 59 HILLSIDE ROAD GREENWICH CT 06830
Masiyiwa Strive director 265 FRANKLIN STREET BOSTON MA 02110
Saint John Bozoma officer: Chief Marketing Officer 9255 SUNSET BLVD 2ND FLOOR LOS ANGELES CA 90069
Neumann Spencer Adam officer: Chief Financial Officer SIERRA INCOME CORPORATION 375 PARK AVE., SUITE 3304 NEW YORK NY 10152
Whetstone Rachel officer: Chief Communications Officer 185 TUSCALOOSA AVENUE ATHERTON CA 94027
Dopfner Mathias director C/O TIME WARNER INC. ONE TIME WARNER CENTER NEW YORK NY 10019
Rice Susan E director 100 WINCHESTER CIRCLE LOS GATOS CA 95032
Belmer Rodolphe director 100 WINCHESTER CIRCLE LOS GATOS CA 95032
Neal Jessica officer: Chief Talent Officer 100 WINCHESTER CIRCLE LOS GATOS CA 95032
Friedland Jonathan officer: Chief Communications Officer C/O NETFLIX, INC., 100 WINCHESTER CIRCLE LOS GATOS CA 95032
Wells David B officer: CFO C/O NETFLIX, INC. 100 WINCHESTER CIRCLE LOS GATOS CA 95130
Bennett Kelly officer: Chief Marketing Officer 100 WINCHESTER CIRCLE LOS GATOS CA 95032
Sweeney Anne M director C/O 100 WINCHESTER CIRCLE LOS GATOS CA 95032

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