NFLX
Netflix, Inc.
Communication Services / Entertainment / Los Gatos, CA
AnalystScope signal
Buy
Scheduled quote
$68
Base fair value
$97
Bear / base / bull
$84 / $97 / $111
Upside / downside
+43.3 upside
Confidence
Medium
Research updated Mar 19, 2026
Daily scheduled refresh as of Jul 21, 2026, 6:05 AM UTC. Fresh through Jul 22, 2026, 6:05 AM UTC.
Informational research only. Not personalized investment advice.
Model vs published view
Current model signal differs from the latest published analyst rating.
Live current-price moves may be widening the gap versus the latest published view.
Investment summary
Current view and thesis
Netflix continues to benefit from subscription durability, pricing power, and a developing ad opportunity, but the current share price leaves less room for execution misses.
Fair value $97 vs. current $68 (+43.3 upside). Current base fair value is $97 versus $68, implying +43.3 upside.
Key drivers
Subscription resilience and pricing power continue to underpin revenue durability.
Advertising remains the clearest incremental upside lever beyond the core subscription model.
Improving free cash flow supports both valuation and declining leverage.
Key risks
The current valuation leaves little room for slower ad monetization or weaker engagement.
Content efficiency could deteriorate if hit rates soften or competitive intensity rises.
Mature-market penetration may make future growth more dependent on flawless execution.
What would change the view
Clearer evidence of durable ad monetization would improve the current stance.
Sustained free-cash-flow outperformance could offset some valuation pressure.
A weaker content slate or slower paid-sharing benefits would likely reinforce the downside case.
Valuation
Price, range, and method support
Base case $97 / +43.3 upside / medium confidence
Price vs fair value
+43.5%
Model-implied return
Scheduled quote
$68
Fair value
$97
Valuation method stack
Weighted fair value $97
Published method weights
DCF (Base)
$99 | 45%
NTM P/E Multiple
$97 | 35%
EV/EBITDA Cross-check
$93 | 20%
| Case / method | Value | Weight / support |
|---|---|---|
| DCF (Base) | $99 | 45% |
| NTM P/E Multiple | $97 | 35% |
| EV/EBITDA Cross-check | $93 | 20% |
| Bear case | $84 | Mixed |
| Base case | $97 | Mixed |
| Bull case | $111 | Supportive |
Fundamental analysis
Reported evidence and normalized model base
Normalized annual basis: FY2025
Normalized figures are AnalystScope's annual valuation model base.
| Normalized metric | Latest value | Growth / margin context |
|---|---|---|
| Revenue | $42.8B | +15.1% YoY |
| Operating income | $11.9B | 27.8% margin |
| Net income | $8.8B | EPS proxy $2.02 |
| Free cash flow | $7.9B | 18.5% margin |
| EBITDA | $13.2B | 30.8% margin |
| Net cash / (debt) | -$5.6B | -13.1% of revenue |
| Metric | Reported | AnalystScope normalized | Basis note |
|---|---|---|---|
| Revenue (TTM) | $45.2B | $42.8B | Model revenue smooths content release timing and the current advertising ramp. |
| Operating Margin | 29.5% | 27.8% | Margin input normalizes content amortization swings and quarter-specific release cadence. |
| FCF (TTM) | $9.5B | $7.9B | FCF input cleans up content cash timing and other uneven release-related distortions. |
| Net Cash / (Debt) | ($2.7B) | ($5.6B) | Balance-sheet treatment keeps leverage conservative even as cash conversion continues to improve. |
Fundamental snapshot
FY2025
Normalized annual model base
Revenue
+15.1% YoY
$42.8B
Op. margin
+2.0% pts
27.8%
FCF margin
+0.7% pts
18.5%
Revenue + margin trend
Annual normalized model-base history.
Revenue
Operating margin
AnalystScope annual model-base statements in USD across FY2023 | FY2024 | FY2025.
Income statement
| Line item | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Revenue | $33.7B | $37.2B | $42.8B |
| Gross Profit | $13.9B | $15.6B | $18.2B |
| Operating Income | $7.8B | $9.6B | $11.9B |
| EBITDA | $8.8B | $10.7B | $13.2B |
| Net Income | $5.7B | $7.0B | $8.8B |
Balance sheet
| Line item | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Cash & Investments | $6.2B | $6.5B | $7.0B |
| Total Debt | $13.4B | $13.0B | $12.6B |
| Net Cash / (Debt) | ($7.2B) | ($6.5B) | ($5.6B) |
| Total Assets | $49.0B | $53.0B | $58.0B |
| Total Liabilities | $28.0B | $30.4B | $33.8B |
| Shareholders' Equity | $21.0B | $22.6B | $24.2B |
Cash flow
| Line item | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Operating Cash Flow | $7.4B | $8.7B | $10.5B |
| Depreciation & Amortization | $1.0B | $1.1B | $1.3B |
| Capital Expenditures | ($1.9B) | ($2.1B) | ($2.6B) |
| Free Cash Flow | $5.5B | $6.6B | $7.9B |
Model assumptions
Base-case inputs and sensitivity
Published AnalystScope assumptions; private edits do not change this base case.
Revenue CAGR (5Y)
12.0%
±1.0% => ±$2.2/sh
Why this level: This is AnalystScope's base-case growth assumption, not a guarantee. It sits below the latest FY model-base revenue pace (2025.0%), so the model does not extend current strength too far into the outer years. Current company context: Subscription resilience and pricing power continue to underpin revenue durability.
Terminal Growth
2.5%
±0.5% => ±$1.5/sh
Why this level: This is AnalystScope's mature long-run growth assumption, not a perpetual hypergrowth claim. At 2.5%, it sits well below the 12.0% five-year revenue CAGR, so the model steps down from the explicit forecast period to a steadier long-run pace. For Netflix, Inc., that means a durable franchise can keep compounding after year five without assuming today's faster growth profile lasts indefinitely.
WACC
8.9%
±0.5% => ∓$1.9/sh
Why this level: This is AnalystScope's base-case cost-of-capital judgment, not a precise CAPM output. It reflects the current rates backdrop, equity risk premium, and the company's balance-sheet posture. Leverage declining with stronger cash conversion
Operating Margin (Year 5)
29.0%
±100 bps => ±$1.1/sh
Why this level: This is AnalystScope's base-case margin view, not a promise of straight-line expansion. It keeps year-five margins close to today's model-base operating margin (27.8%), which implies the current margin structure is broadly durable. Margin input normalizes content amortization swings and quarter-specific release cadence.
Sensitivity drivers
Revenue CAGR (5Y)
12.0%
±1.0% => ±$2.2/sh
Terminal Growth
2.5%
±0.5% => ±$1.5/sh
WACC
8.9%
±0.5% => ∓$1.9/sh
Operating Margin (Year 5)
29.0%
±100 bps => ±$1.1/sh
Confidence
Medium
Method outputs are tightly grouped at +6.2% dispersion.
Why the model view could be wrong
The current valuation leaves little room for slower ad monetization or weaker engagement.
Content efficiency could deteriorate if hit rates soften or competitive intensity rises.
Mature-market penetration may make future growth more dependent on flawless execution.
Private analysis
Test your own assumptions in Scenario Builder
Private scenarios remain separate from AnalystScope's published base case.
Private workspace
Scenario Builder
Private scenario sandbox
This is a private modelling layer, not the public AnalystScope base case or printable snapshot. It keeps the public base case as the anchor, applies bounded changes to the four core valuation inputs, and updates your scenario fair-value estimate immediately.
Saved scenarios currently stay local to this browser for NFLX. Base-case rationale remains in the public assumptions section above. Your scenario output reprices the published valuation methods from projected operating anchors when those anchors are available, while keeping market-multiple and capital-structure assumptions anchored to the AnalystScope framework.
Editable assumptions
Adjust your scenario inputs within the displayed plausible range for this company. The workbench stays anchored to the public AnalystScope base case.
This is a bounded scenario tool, not a free-form spreadsheet. Values outside the displayed range snap back to the nearest allowed value when you leave the field.
Matches the published AnalystScope base case.
Revenue CAGR (5Y)
Public AnalystScope base case: 12.0% | ±1.0% => ±$2.2/sh
Allowed range: 6.0% to 18.0%
Terminal Growth
Public AnalystScope base case: 2.5% | ±0.5% => ±$1.5/sh
Allowed range: 1.0% to 4.0%
WACC
Public AnalystScope base case: 8.9% | ±0.5% => ∓$1.9/sh
Allowed range: 6.9% to 10.9%
Operating Margin (Year 5)
Public AnalystScope base case: 29.0% | ±100 bps => ±$1.1/sh
Allowed range: 21.0% to 37.0%
Saved private scenarios
Save up to 5 named scenarios for NFLX. These are your scenarios: they never overwrite the public AnalystScope base case and remain clearly separate from public research.
Checking private workspace session...
Private scenario note
Keep a short thesis, main risk, or why this case differs from the published base case.
0 / 280
Notes stay local to this browser unless you sign in to the private workspace, and they never appear as published AnalystScope research.
No private scenarios saved yet. Make a change to the published base case, then save a named scenario here.
Published base case
Fair value
$97
Upside / Downside
+43.3 upside
Model signal
Buy
Published base-case output
Scenario output reprices the published DCF and multiple methods from projected year-5 revenue, margin, free cash flow, EBITDA, and EPS anchors. Market multiples and capital structure stay anchored to the published base framework.
Fair value
$97
$0/sh vs published base case
Upside / Downside
+43.3 upside
+0.0 pts vs published base case
Model signal
Buy
Unchanged versus the published base case.
Method movement inside the scenario
This breakdown shows what moved inside the published valuation framework when you edit the scenario. The published AnalystScope base case stays anchored, and any method without a clean projected anchor remains pinned to that framework.
Method rows below reflect the current edited scenario state, not just the saved scenario snapshots.
Influence tags are directional rather than exact attribution. They estimate which edited input is moving each method most by reverting one assumption at a time while the other edited inputs stay in place.
| Method | Published base | Edited scenario | Delta | How it moved / main drivers |
|---|---|---|---|---|
DCF (Base) DCF-style | 45% weight | $99 | $99 | $0/sh | Base-aligned This method is supported by the model-native bridge and currently stays aligned with the published base case. Edited inputs are largely offsetting each other, so this row stays close to the published base case. |
NTM P/E Multiple P/E-style | 35% weight | $97 | $97 | $0/sh | Base-aligned This method is supported by the model-native bridge and currently stays aligned with the published base case. Edited inputs are largely offsetting each other, so this row stays close to the published base case. |
EV/EBITDA Cross-check EV-based multiple | 20% weight | $93 | $93 | $0/sh | Base-aligned This method is supported by the model-native bridge and currently stays aligned with the published base case. Edited inputs are largely offsetting each other, so this row stays close to the published base case. |
Weighted fair value Published framework result | Published framework result | $97 | $97 | +$0/sh | Moved Combines the repriced method outputs using the published AnalystScope weights. No single edited assumption is dominating this move in a material way. |
Published base case vs private scenarios
Compare the published AnalystScope base case against your saved private scenarios in one view. Saved scenarios remain local to this browser, and the table below reflects saved snapshots rather than any unsaved edits currently sitting in the editor.
Fair-value comparisons use the same workbench recalculation path as the editor above.
Published base case stays pinned as the anchor row.
| Scenario | Revenue CAGR (5Y) | Terminal Growth | WACC | Op. Margin (Y5) | Fair Value | Upside / Downside | Model Signal | Delta vs Base | Action |
|---|---|---|---|---|---|---|---|---|---|
AnalystScope base case PublishedOfficial AnalystScope anchor row. | 12.0% | 2.5% | 8.9% | 29.0% | $97 | +43.3 upside | Buy | Published anchor |
Supporting research
Quality, normalization, and monitoring evidence
Annual model base: FY2023 | FY2024 | FY2025
Thesis scorecard
Growth
ModerateGrowth remains healthy, though ad monetization and mature-market penetration still shape the next leg.
Profitability
StrongMargin structure and cash conversion continue to improve as scale deepens.
Balance sheet
ModerateLeverage is improving, but the balance sheet is still less conservative than cash-rich peers.
Valuation
WeakThe shares already price in a lot of execution and monetization success.
Execution / Resilience
StrongGlobal scale and product execution remain clear strengths.
Current source status
Quote: Daily scheduled refresh as of Jul 21, 2026, 6:05 AM UTC. Fresh through Jul 22, 2026, 6:05 AM UTC.
Reported fundamentals: Fundamentals refreshed 21 Jul 2026, 00:39 UTC. Fresh through 21 Jul 2026, 12:39 UTC.
Latest filing: FWP filed Jul 20, 2026. Filing refreshed Jul 21, 2026, 12:39 AM UTC. Fresh through Jul 21, 2026, 12:39 PM UTC.
Annual model-base income-statement, cash-flow, and balance-sheet metrics, plus cross-statement quality relationships with compact prior-FY direction cues, derived from the curated statement backbone.
Basis: FY2023 | FY2024 | FY2025. Live reported fundamentals remain available in the reconciliation section.
Operating and cash-flow trends
Revenue growth (1Y)
+15.1%
Gross margin
42.5%
Operating margin
27.8%
Operating margin change vs prior FY
+2.0 pts
EBITDA margin
30.8%
EBITDA margin change vs prior FY
+2.1 pts
Operating income growth (1Y)
+24.0%
Net margin
20.6%
FCF margin
18.5%
FCF margin change vs prior FY
+0.7 pts
FCF growth (1Y)
+19.7%
Balance sheet quality
Cash & investments
$7.0B
Total debt
$12.6B
Net cash / (debt)
Net debt $5.6B
Net cash / (debt) as % of revenue
Net debt 13.1% of revenue
Liabilities / assets
vs FY2024 (+0.9 pts)
58.3%
Cross-statement quality
Gross-to-operating spread
14.7 pts
Operating cash flow / net income
vs FY2024 (-0.0x)
1.2x
Operating cash flow / EBITDA
vs FY2024 (-0.0x)
0.8x
Free cash flow / net income
vs FY2024 (-0.0x)
0.9x
CapEx as % of revenue
vs FY2024 (+0.4 pts)
6.1%
CapEx as % of operating cash flow
vs FY2024 (+0.6 pts)
24.8%
CapEx / D&A
vs FY2024 (+0.1x)
2.0x
Cash & investments / total debt
vs FY2024 (+0.1x)
0.6x
Shareholders' equity as % of revenue
56.5%
Asset turnover
vs FY2024 (+0.0x)
0.7x
Compact model-base diagnostics for analyst triage, highlighting where the durable valuation base is diverging most clearly from the latest reported picture.
Adjustment focus
Moderate adjustmentCash flow | FCF (TTM) | -$1.6B / -17%
Revenue momentum
Improving+15.1% latest 1Y growth
vs +10.4% prior 1Y
Operating margin trend
Improving27.8% latest margin
+200 bps vs prior FY
FCF margin trend
Stable18.5% latest FCF margin
+72 bps vs prior FY
Balance-sheet posture
StrengtheningNet debt 13.1% of revenue
vs Net debt 17.5% of revenue prior FY
How to read this
Reported = the latest company-reported figure. Model base = AnalystScope's comparable operating base used for valuation and thesis work. It may include standardization, conservative balance-sheet treatment, working-capital cleanup, and through-cycle adjustments when current reported numbers do not look durable.
This is an analyst model base, not a claim of perfect adjusted truth. Larger gaps can reflect deliberate cyclical or base-case adjustments, not just light accounting cleanup.
Why the model base differs
For Netflix, normalization reduces content-timing distortion and makes the thesis lean more on durable subscriber economics and ad monetization than on any one release slate.
Rows are sorted by largest comparable adjustment first.
| Metric | Model base | Live reported | Variance vs reported | Adjustment size | Why lower / higher? |
|---|---|---|---|---|---|
FCF (TTM) | $7.9B FY2025 model base | $9.5B Live reported TTM | -$1.6B / -17% | Moderate adjustment | Model base is lower than live reported because cash generation is being smoothed for timing effects rather than taken at face value. It cleans up content cash timing and other uneven release-related distortions. |
Net Cash / (Debt) | ($5.6B) FY2025 model base | ($2.7B) Live reported balance sheet | -$2.9B / -6% of revenue | Moderate adjustment | Model base is more conservative than the live reported balance-sheet figure. It keeps leverage conservative even as cash conversion continues to improve. |
Revenue (TTM) | $42.8B FY2025 model base | $45.2B Live reported TTM | -$2.4B / -5% | Close to reported | Model base is lower than live reported because the thesis does not carry the current revenue run-rate straight into the durable operating base. It smooths content release timing and the current advertising ramp. |
Operating Margin | 27.8% FY2025 model base | 29.5% Live reported margin | -1.7 pts | Close to reported | Model base is lower than live reported because current margin strength is not being treated as a permanent through-cycle outcome. It normalizes content amortization swings and quarter-specific release cadence. |
Near-term catalysts
Ad-tier monetization and engagement trends remain the nearest catalysts for estimate revisions.
Margin commentary tied to content amortization can move the market's confidence quickly.
Subscriber and churn data across mature markets still matter for the long-term growth narrative.
What we are watching
Whether advertising matures into a larger, more predictable contributor to revenue growth.
How content efficiency trends hold up as Netflix scales globally.
Any sign that pricing power is weakening in mature, highly penetrated markets.
| Date | Event | Published rating | Note |
|---|---|---|---|
| Mar 19, 2026 | Downgraded | Sell | Downgraded to Sell as valuation ran well ahead of our base-case cash-flow assumptions. |
| Jan 29, 2026 | Reiterated | Hold | Maintained Hold while operating trends improved but upside remained limited. |
| Dec 11, 2025 | New | Hold | Initiated coverage with a balanced stance on growth durability versus valuation. |