10-QPeriod: Q2 FY2026

NETFLIX INC Quarterly Report for Q2 Ended Jun 30, 2026

Filed July 17, 2026For Securities:NFLX

Summary

Netflix Inc. reported strong revenue growth of 13% year-over-year for the second quarter of 2026, reaching $12.6 billion, driven by a growing membership base, price adjustments, and increased advertising revenue. While revenue increased, the operating margin saw a slight decrease of 0.7% to 33.4% due to faster growth in technology, development, and sales/marketing expenses compared to revenue. Net income rose by 9% to $3.4 billion, supported by the higher operating income, although partially offset by increased tax provisions. The company highlighted significant investments in content, with cost of revenues increasing by 13% primarily due to content amortization. Netflix continues to expand its global presence, with Latin America and Asia-Pacific regions showing the strongest revenue growth rates at 21% and 16% respectively for Q2 2026. The company remains committed to its core strategy of global growth within its operating margin targets, continuously improving member experience, and offering a variety of pricing plans, including its ad-supported tier.

Key Highlights

  • 1Revenue grew 13% to $12.6 billion in Q2 2026, driven by membership growth, price increases, and advertising.
  • 2Operating income increased by 11% to $4.2 billion, though operating margin slightly compressed to 33.4% from 34.1% year-over-year.
  • 3Net income rose 9% to $3.4 billion for the quarter.
  • 4Cost of revenues increased by 13%, largely due to a $479 million rise in content amortization.
  • 5Sales and marketing expenses and technology and development expenses saw significant increases of 16% and 22% respectively, impacting operating margin.
  • 6Latin America and Asia-Pacific regions demonstrated the highest revenue growth rates at 21% and 16% for Q2 2026.
  • 7The company repurchased $5.9 billion of common stock in the first six months of 2026, with $27.1 billion remaining available for future repurchases.

Frequently Asked Questions

Netflix's revenue for Q2 2026 increased by 13% year-over-year, primarily driven by the growth in its membership base, price adjustments on its various plans, and increased advertising revenue from its ad-supported tier.

The operating margin saw a slight decrease from 34.1% to 33.4% because technology and development expenses and sales and marketing expenses grew at a faster rate than revenue during the quarter. These increased expenses were primarily related to personnel costs and marketing activities.

Netflix's cost of revenues increased by 13% year-over-year, with content amortization being the primary driver, up by $479 million. This reflects the company's ongoing investment in both existing and new content to enhance its offerings and attract/retain subscribers.

As of June 30, 2026, Netflix had $9.1 billion in cash, cash equivalents, restricted cash, and short-term investments. The company anticipates that its operating cash flows, available funds, and access to financing sources will be sufficient to meet its cash needs for the next twelve months and beyond. Significant future cash requirements include content obligations, debt, and lease obligations.