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Netflix Balance Sheet

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According to their Income Statement, Netflix’s net income has been steady. Some of the factors driving their revenue growth are contributed to the increase in international subscribers. There are also some seasonal and cyclical factors which contribute to their bottom line. Netflix has the same season pattern as regular television. The first and fourth quarters of the year are the peak times of subscriber additions. Subscribership tends to decline in the second and third quarters which is due because of summer time activities. Netflix has a low cost for entertainment; therefore, in the times of tight budgets, people will continue to use their service. In good times, people are not looking at ways to cut cost so they do not tend to question their monthly payment to Netflix. One of the most important items …show more content…

By using cash instead of licensing its original programming they run at a negative cash flow. However, the advantages are long-term economics and better control over the content. In 2016 the EBITDA growth was greater than the revenue growth. This can be explained by the expansion into 130 countries that year. Balance Sheet: The balance sheet provides the big picture of a company’s financial condition. When considering the pros and cons of investing in a company it is advisable to take a good look at their balance sheet. By understanding Netflix’s balance sheet, an investor, creditor, analyst or stakeholder can understand how well-positioned the company is to maintain and increase success. Assets are the items that help determine the value of a business as well as the liquidity. Netflix’s primary assets are their cash and cash equivalents, short-term investments, net receivables, inventory, and other current assets. In figure 1.3, you can see the changes in their liquidity over the last three years. According to this, the overall current assets have trended

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