Netflix sells monthly memberships to a streaming service. In 2025 its revenue was $45.2 billion, up 16% on 2024. Its operating income, which is revenue less the costs of running the business, was $13.3 billion under US Generally Accepted Accounting Principles (GAAP), a margin of 29.5%.
This guide shows where Netflix's revenue comes from, what it spends on content and its main announcements since November 2025. The figures cover 2025 and the quarter to 30 June 2026, the latest reported when this guide was written on 15 October 2026. Netflix announced on 14 September 2026 that it would report its third quarter on 20 October 2026.
What does Netflix do? Netflix runs a streaming service that sells monthly memberships. Membership fees are its main source of revenue. It also sells advertising on its ad-supported plan.
Content is its largest cost: $16.4 billion of content amortisation in 2025, which is 36.3% of revenue. Content amortisation spreads the cost of programming over time.
In the three months to 30 June 2026, the United States and Canada brought in 43.2% of revenue. The rest of the world brought in 56.8%.
Netflix stopped reporting its number of paid memberships during 2025. It now reports revenue and operating margin as its main measures.
What Netflix sells and how it earns
Netflix operates as one operating segment. Its annual report states that its revenues are primarily derived from monthly membership fees.
Netflix describes itself as offering television (TV) series, films, games and live programming. As at 30 June 2026, its plans cost the equivalent of $1 to $38 a month in US dollars, depending on the country and the plan.
Netflix also sells advertising on its lower-priced ad-supported plan. On 16 July 2026 it forecast that its advertising revenue would roughly double in 2026, to approximately $3 billion. That is about 6% of the $51.0 billion to $51.4 billion of revenue it forecast for 2026.
During 2025 Netflix stopped reporting how many paying members it has. Its annual report says it now focuses on revenue and operating margin as the primary financial metrics that it believes best represent its business performance.
Where Netflix's revenue comes from by region
Netflix reports revenue in four regions. They are the United States and Canada (UCAN), Europe, the Middle East and Africa (EMEA), Latin America (LATAM) and Asia-Pacific (APAC).
Source: Netflix shareholder letters and Form 10-Q (SEC); YX Insights
Chart 1 shows each region's revenue for five quarters, with column totals on top. The labels are rounded, so a column's labels can differ from its total by 0.01.
In the three months to 30 June 2026, total revenue was $12.56 billion, up 13% from $11.08 billion a year earlier. UCAN brought in $5.43 billion, which is 43.2% of the total. The other three regions brought in 56.8%.
Revenue grew in every region against the quarter to 30 June 2025. UCAN grew 10%, EMEA 14%, LATAM 21% and APAC 16%. Netflix said UCAN's growth reflected only a partial quarter of a price change.
Where each dollar of Netflix revenue goes
Content is the cost that shapes the rest. Netflix pays for programming, records the cost as an asset, then charges it against income over time. That charge is content amortisation.
Source: Netflix Form 10-K for 2025 (SEC); YX Insights
Chart 2 splits each $100 of 2025 revenue into its costs and the GAAP operating income left. Content amortisation took $36.3. GAAP operating income was $29.5.
Operating income is revenue minus those costs, before interest and tax. Our guide to reading an income statement explains each line.
The cash spent can differ from the charge. In 2025 the cash flow statement shows $17.1 billion of additions to content assets, against $16.4 billion of amortisation. For 2026, Netflix forecast on 16 July 2026 that cash content spending would be about 1.1 times amortisation.
Netflix's GAAP operating margin was 20.6% in 2023, 26.7% in 2024 and 29.5% in 2025. On 16 July 2026 it forecast 31.5% for 2026.
Quarterly margins swing. The GAAP operating margin was 24.5% in the fourth quarter of 2025 and 33.4% in the second quarter of 2026.
Netflix signs multi-year commitments for programming. At 31 December 2025 its content obligations were $24.0 billion, of which $11.5 billion fell due within 12 months.
Of the total, $18.4 billion was not on its balance sheet, because the commitments did not yet meet the criteria for recognition.
Free cash flow is operating cash flow minus purchases of property and equipment. Netflix defines it that way, as a non-GAAP measure. It was $9.5 billion in 2025.
For 2026 Netflix forecast on 16 July 2026 free cash flow of about $12.5 billion. Our free cash flow guide explains why definitions differ.
Latest developments, with dates
On 16 July 2026 Netflix reported its second quarter. Revenue was $12.56 billion and GAAP operating margin 33.4%.
It narrowed its 2026 revenue forecast to $51.0 billion to $51.4 billion. It continued to forecast a GAAP operating margin of 31.5% for 2026, consistent with its earlier forecast.
For the third quarter it forecast revenue of $12.86 billion and a GAAP operating margin of 33.2%. These are Netflix's own forecasts.
On 27 February 2026 Warner Bros. Discovery (WBD) ended the agreement it had signed with Netflix on 4 December 2025 to sell its streaming and studios businesses. WBD signed with Paramount Skydance instead.
Netflix received a $2.8 billion termination fee, which it recorded in interest and other income in the first quarter of 2026.
On 22 April 2026 Netflix's board authorised a further $25 billion of share repurchases. Netflix bought back $4.7 billion of stock in the second quarter, its largest quarter of repurchases. At 16 July 2026 it had $27.1 billion of capacity left.
On live events, Netflix said on 16 July 2026 that it expected live programming to be just over 5% of its 2026 content spending but about 1% of view hours.
On 13 October 2026 it announced exclusive rights in Spain and Andorra to all 104 matches of the Fédération Internationale de Football Association (FIFA) World Cup 2030.
On 14 November 2025 Netflix completed a ten-for-one stock split. Share prices and per-share figures before that date are restated.
The chart below includes SPY (the exchange-traded fund, or ETF, that tracks the Standard & Poor's 500, or S&P 500, an index of large US companies).
Source: YX Insights price data
Chart 3 sets Netflix, The Walt Disney Company and SPY to 100 on 14 October 2021.
Disney is another US-listed entertainment company. By 14 October 2026 Netflix stood at 111, Disney at 62 and SPY at 174. These are closing prices, adjusted for splits, with dividends not counted.
On 14 October 2026 Netflix closed 47.3% below its highest close of the five years, which was on 30 June 2025.
The chart shows a jump in late February 2026. Netflix closed 13.8% higher on 27 February 2026, from $84.59 to $96.24.
WBD ended its agreement to sell to Netflix on that date. The cause of the rise is not established from a primary source, so this guide does not give one.
The Magnificent 7 is a nickname for seven large US companies: Nvidia, Apple, Microsoft, Alphabet, Amazon, Meta Platforms and Tesla. Netflix is not one of them. Our guide to the Magnificent 7 stocks shows how much of the S&P 500 the seven make up.
Across the eight results Netflix reported from October 2024 to July 2026, the median move in its share price by the next close was 8.5%, up or down. The largest fall was 10.1% after the 21 October 2025 results. The largest rise was 11.1% after the 17 October 2024 results.
After the 16 July 2026 results the next session closed 7.3% lower.
Netflix runs a streaming service funded by membership fees and advertising. In 2025 it spent 36.3% of revenue on content amortisation. GAAP operating income was 29.5% of revenue, before interest and tax.
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Common questions about Netflix
How does Netflix make money?
Netflix makes money mainly from monthly membership fees. It also sells advertising on its ad-supported plan, which it forecast on 16 July 2026 at approximately $3 billion of revenue for 2026. In 2025 its revenue was $45.2 billion and its GAAP operating income was $13.3 billion.
Does Netflix still report how many subscribers it has?
No. Netflix stopped reporting membership numbers during 2025. Its annual report says it now focuses on revenue and operating margin as the primary financial metrics that it believes best represent its business performance. It still reports revenue for each of its four regions every quarter.
When does Netflix report its next results?
Netflix announced on 14 September 2026 that it would post its third quarter 2026 results on Tuesday 20 October 2026, at approximately 1:01 p.m. Pacific Time. A live video interview with its co-chief executive officers was set for 1:45 p.m. Pacific Time. Its latest results when this guide was written covered the second quarter of 2026.
Is Netflix one of the Magnificent 7?
No. The Magnificent 7 is a nickname for seven large US companies: Nvidia, Apple, Microsoft, Alphabet, Amazon, Meta Platforms and Tesla. Netflix is not one of them. Our guide to the Magnificent 7 stocks explains the label.
Did Netflix split its stock?
Yes. On 14 November 2025 Netflix completed a ten-for-one forward stock split. Each shareholder of record on 10 November 2025 received nine additional shares for every share held. Share prices and per-share figures from before that date are restated to match.
DISCLAIMER: This article is strictly educational. Any information or analysis in this note is not an offer to sell or the solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice and nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.