Executive Summary
Netflix Inc (NFLX) reported robust Q1 2024 results, showcasing a significant revenue increase of 14.95% year-over-year, totaling $9.38 billion. This upward trend is attributed to effective engagement with members and strategic pricing adjustments, yielding a net income boost of 78.7% compared to the same period last year. The company's strong member growth and renewed focus on engagement-driven strategies reflect its commitment to enhance value and satisfaction for subscribers, marking a pivotal moment in its growth trajectory. Management's insights emphasized ongoing improvements in content offerings and the advertising segment, suggesting a positive outlook for sustained growth in the coming quarters.
Key Performance Indicators
QoQ: 148.68% | YoY:78.70%
QoQ: 151.16% | YoY:84.30%
Key Insights
**Revenue:** $9.38 billion (YoY: +14.95%, QoQ: +6.21%)
**Gross Profit:** $4.40 billion (YoY: +31.17%, QoQ: +24.94%)
**Operating Income:** $2.64 billion (YoY: +54.21%, QoQ: +76.70%)
**Net Income:** $2.33 billion (YoY: +78.70%, QoQ: +148.68%)
**EPS:** $5.40 (YoY: +84.30%, QoQ: +151.16%)
This performance illustrates Netflixβs effective engagement strategy and evolving revenue model, despite the cessation of regular membership reporting starting in 2025. Management noted significant impr...
Financial Highlights
Revenue: $9.38 billion (YoY: +14.95%, QoQ: +6.21%)
Gross Profit: $4.40 billion (YoY: +31.17%, QoQ: +24.94%)
Operating Income: $2.64 billion (YoY: +54.21%, QoQ: +76.70%)
Net Income: $2.33 billion (YoY: +78.70%, QoQ: +148.68%)
EPS: $5.40 (YoY: +84.30%, QoQ: +151.16%)
This performance illustrates Netflixβs effective engagement strategy and evolving revenue model, despite the cessation of regular membership reporting starting in 2025. Management noted significant improvements in both member engagement and monetization strategies, indicating the capacity for further revenue acceleration.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
9.38B |
14.95% |
6.21% |
| Gross Profit |
4.40B |
31.17% |
24.94% |
| Operating Income |
2.64B |
54.21% |
76.70% |
| Net Income |
2.33B |
78.70% |
148.68% |
| EPS |
5.40 |
84.30% |
151.16% |
Key Financial Ratios
operatingProfitMargin
28.2%
operatingCashFlowPerShare
$5.12
freeCashFlowPerShare
$4.95
Management Commentary
Strategic Transition: Greg Peters (Co-CEO) noted, "We're evolving our revenue model and adding offerings like advertising... the historical math of number of members times the monthly price is less accurate in capturing our business's state."
Member Satisfaction and Growth: Ted Sarandos (Co-CEO) stated, "We have had the number one film on streaming for eight of the first eleven weeks of the year... consistent hits are crucial for engagement and retention."
"Happy members watch more, they stick around longer, they tell friends, which all grows engagement, revenue and profit." - Ted Sarandos, Co-CEO
β Ted Sarandos
"We're committed to grow margin each year, and we see a lot of runway to continue to grow profit and profit margin over the long term." - Spence Neumann, CFO.
β Spence Neumann
Forward Guidance
Management guided for sustained healthy double-digit revenue growth throughout 2024, despite facing tougher year-over-year comparisons in the latter half. The introduction of advertising and paid sharing is expected to bolster both engagement and revenue in the long-term, with management expressing confidence in reaching and penetrating deeper into the untapped subscriber base. The anticipated achievement of 25% margins also highlights the company's profitability goals.