Netflix (NFLX)
The company that taught the world to stream, now growing through price rises and advertising rather than new subscribers. That is a different business to value.
The business
Netflix sells subscriptions to a library of licensed and original content, increasingly supplemented by advertising on a cheaper tier and by live events. Q2 2026 revenue was $12.56bn, up 13%, attributed to membership growth, pricing and higher advertising revenue.
Full-year 2026 revenue guidance was narrowed to $51.0-51.4bn.
The numbers that matter
All figures as reported on the dates shown. Nothing on this page updates with the share price — the live valuation sits in the app.
| Measure | Latest reported | |
|---|---|---|
| Q2 2026 revenue | $12.56bn | +13% |
| Earnings per share | 80 cents | vs 79 cents expected |
| Net income | $3.40bn | from $3.13bn |
| Revenue vs consensus | $12.56bn | just under $12.59bn expected |
| Q3 revenue growth guided | 12% | company guidance |
| FY2026 revenue guidance | $51.0-51.4bn | narrowed range |
The moat
Scale in content spending, which is a real but expensive moat. Netflix can amortise a large production budget across more subscribers than almost any rival, so it can outspend them per title while spending less per viewer.
The limit is that content is not owned attention the way a social network is. Subscribers can leave at the end of any month and the library does not stop them — which is why pricing power has to be tested rather than assumed. Netflix raised prices across all plans in 2026 and reported the result as consistent with previous increases.
What to check before you value it
Whether price rises stick
Growth now depends more on revenue per member than on new members. The company said the 2026 price increases performed in line with prior changes. Watch whether that holds when it is repeated.
Advertising as a share of revenue
The ad-supported tier is a second business with different economics. It is cited as a growth driver but is not yet the main one.
Content spending against cash generation
Content is a cash cost long before it is an audience. The relationship between what is spent and what it returns is the core of any streaming valuation.
Reduced engagement disclosure
From 2027 the company will publish its 'What We Watched' report annually rather than twice a year, saying it wants focus on financial metrics. Less frequent engagement data makes the business harder to check independently.
Recent filings
Dated announcements only. Figures below were reported on the dates shown and are not updated as the share price moves.
How Oak Growth scores it
Oak Growth runs a discounted cash flow on Netflix and publishes the assumptions behind it — the discount rate, the growth rate and the terminal value — alongside a margin of safety against the live price. It also scores the company on the four pillars: moat, management, economics and value, in that order, because price comes last. The live figures sit in the app rather than on this page, so nothing here goes stale.
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Try Oak Growth — 7-day free trialCommon questions
Is Netflix still growing?
Yes, but differently. Q2 2026 revenue rose 13% to $12.56bn, driven by a combination of membership growth, price increases and advertising rather than by subscriber additions alone. Full-year guidance was narrowed to $51.0-51.4bn.
How does Netflix make money from advertising?
Through a lower-priced ad-supported subscription tier, where revenue comes from advertisers as well as the member. The company cited increased advertising revenue as a contributor to Q2 2026 growth.
Why is Netflix publishing engagement data less often?
From 2027 the 'What We Watched' report moves to once a year in the first quarter, separated from earnings. Netflix stated the aim is to keep attention on financial metrics such as revenue and operating profit.
What is the main risk in valuing Netflix?
Content is a large cash cost incurred before any subscriber sees it, and subscriptions can be cancelled monthly. A valuation therefore rests on whether pricing power and retention hold as content spending continues, rather than on any single year's earnings.
Related
What is an economic moat? → · Amazon → · How to calculate intrinsic value →