Netflix (NFLX) Financials

Netflix’s latest quarter shows strong revenue growth, sharply higher profitability, and a very healthy cash position. In Q1 2026, revenue rose to $12.25 billion from $10.25 billion a year ago, while net income jumped to $5.28 billion from $1.87 billion in Q4 2024 and $2.89 billion in Q1 2025. That’s a sign the business is still scaling efficiently, even as it continues to spend heavily on content and marketing.

One important detail: Netflix’s reported net income is boosted by a large “other income” line, which was $2.85 billion in Q1 2026. Operating income was still very strong at $3.96 billion, but investors should remember that the bottom line is not just driven by core streaming operations.

Looking at the multi-year trend, the picture is broadly positive. Revenue has climbed steadily from $7.87 billion in Q1 2022 to $12.25 billion in Q1 2026. Operating income also improved meaningfully over that stretch, moving from $1.97 billion in Q1 2022 to $3.96 billion in Q1 2026. Netflix is doing a better job of turning sales growth into earnings.

• Revenue growth remains strong: Q1 2026 revenue increased about 19% year over year, continuing a long run of top-line expansion.
• Operating profit is expanding: Q1 2026 operating income of $3.96 billion was up sharply from $3.25 billion in Q3 2025 and well above prior-year levels.
• Margins improved: Gross profit in Q1 2026 was $6.36 billion, with cost of revenue at about 48% of sales, showing good leverage.
• Cash generation is excellent: Netflix produced $5.29 billion of operating cash flow in Q1 2026, a very strong result for a quarterly period.
• Liquidity is solid: Cash and equivalents were $12.26 billion at Q1 2026, with total current assets of $17.07 billion.
• Equity has grown: Total common equity reached $31.13 billion in Q1 2026, up from $24.74 billion at year-end 2024.
• Long-term business momentum is intact: Revenue, operating income, retained earnings, and cash all trend higher versus 2022-2024 levels.
• Content amortization remains very large: Amortization expense was $4.22 billion in Q1 2026, which is normal for Netflix but makes the cash flow statement look very different from reported earnings.
• Netflix still returns cash to shareholders: The company repurchased $1.27 billion of common equity in Q1 2026, showing ongoing capital return activity.
• Debt is still meaningful: Q1 2026 long-term debt was $13.36 billion and short-term debt was $999 million, so leverage remains a factor to watch.

Balance sheet quality looks manageable, but not spotless. Total liabilities were $29.89 billion in Q1 2026 versus $28.87 billion at year-end 2024, while equity increased. That suggests Netflix is growing into its capital structure, but it still carries a sizable debt load and a business model that depends heavily on continued content investment.

Bottom line: Netflix appears to be in good financial health. Revenue is still climbing, operating profitability is strong, operating cash flow is robust, and the company has ample liquidity. The main caution is that some of the earnings strength comes from non-operating income, and the balance sheet still includes meaningful debt. Overall, the trend across the last four years is favorable for long-term investors.