Cover Page
Cover Page | 9 Months Ended |
Sep. 30, 2022 shares | |
Cover [Abstract] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Sep. 30, 2022 |
Document Transition Report | false |
Entity File Number | 001-35727 |
Entity Registrant Name | Netflix, Inc. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 77-0467272 |
Entity Address, Address Line One | 100 Winchester Circle, |
Entity Address, City or Town | Los Gatos, |
Entity Address, State or Province | CA |
Entity Address, Postal Zip Code | 95032 |
City Area Code | 408 |
Local Phone Number | 540-3700 |
Title of 12(b) Security | Common stock, par value $0.001 per share |
Trading Symbol | NFLX |
Security Exchange Name | NASDAQ |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 445,020,494 |
Entity Central Index Key | 0001065280 |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | Q3 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenues | $ 7,925,589 | $ 7,483,467 | $ 23,763,497 | $ 21,988,526 |
Cost of revenues | 4,788,665 | 4,206,589 | 13,764,125 | 12,093,108 |
Marketing | 567,954 | 635,948 | 1,698,892 | 1,752,433 |
Technology and development | 662,739 | 563,887 | 2,037,115 | 1,626,415 |
General and administrative | 373,213 | 321,790 | 1,180,438 | 953,831 |
Operating income | 1,533,018 | 1,755,253 | 5,082,927 | 5,562,739 |
Other income (expense): | ||||
Interest expense | (172,575) | (190,429) | (535,609) | (576,191) |
Interest and other income | 261,404 | 96,135 | 677,275 | 302,702 |
Income before income taxes | 1,621,847 | 1,660,959 | 5,224,593 | 5,289,250 |
Provision for income taxes | (223,605) | (211,888) | (787,953) | (780,451) |
Net income | $ 1,398,242 | $ 1,449,071 | $ 4,436,640 | $ 4,508,799 |
Earnings per share: | ||||
Basic (dollars per share) | $ 3.14 | $ 3.27 | $ 9.98 | $ 10.18 |
Diluted (dollars per share) | $ 3.10 | $ 3.19 | $ 9.83 | $ 9.90 |
Weighted-average shares of common stock outstanding: | ||||
Basic (in shares) | 444,878 | 442,778 | 444,529 | 443,052 |
Diluted (in shares) | 450,344 | 454,925 | 451,168 | 455,230 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 1,398,242 | $ 1,449,071 | $ 4,436,640 | $ 4,508,799 |
Other comprehensive loss: | ||||
Foreign currency translation adjustments | (103,167) | (29,610) | (207,148) | (64,233) |
Comprehensive income | $ 1,295,075 | $ 1,419,461 | $ 4,229,492 | $ 4,444,566 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||||
Net income | $ 1,398,242 | $ 1,449,071 | $ 4,436,640 | $ 4,508,799 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Additions to content assets | (4,582,671) | (4,666,237) | (12,853,846) | (12,047,563) |
Change in content liabilities | 60,867 | (29,246) | (95,054) | (607,494) |
Amortization of content assets | 3,653,592 | 2,963,051 | 10,081,305 | 8,489,050 |
Depreciation and amortization of property, equipment and intangibles | 85,188 | 70,253 | 243,295 | 144,428 |
Stock-based compensation expense | 152,062 | 95,078 | 421,663 | 303,891 |
Foreign currency remeasurement gain on debt | (348,458) | (136,488) | (814,792) | (326,744) |
Other non-cash items | 102,513 | 102,211 | 409,855 | 282,971 |
Deferred income taxes | (57,797) | 50,967 | (242,523) | 261,827 |
Changes in operating assets and liabilities: | ||||
Other current assets | (120,071) | (95,145) | 44,485 | (369,073) |
Accounts payable | 53,875 | 24,836 | (283,617) | (40,164) |
Accrued expenses and other liabilities | 212,072 | 269,774 | 324,116 | 276,241 |
Deferred revenue | (48,420) | (4,732) | (42,053) | 64,640 |
Other non-current assets and liabilities | (4,184) | (11,014) | (47,075) | (144,925) |
Net cash provided by operating activities | 556,810 | 82,379 | 1,582,399 | 795,884 |
Cash flows from investing activities: | ||||
Purchases of property and equipment | (84,960) | (167,327) | (296,136) | (358,606) |
Change in other assets | 0 | (21,304) | 0 | (26,919) |
Acquisitions | 0 | 0 | (193,397) | 0 |
Net cash used in investing activities | (84,960) | (188,631) | (489,533) | (385,525) |
Cash flows from financing activities: | ||||
Repayments of debt | 0 | 0 | (700,000) | (500,000) |
Proceeds from issuance of common stock | 4,113 | 18,445 | 29,041 | 86,265 |
Repurchases of common stock | 0 | (100,000) | 0 | (600,022) |
Net cash provided by (used in) financing activities | 4,113 | (81,555) | (670,959) | (1,013,757) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (180,058) | (63,843) | (336,704) | (82,504) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 295,905 | (251,650) | 85,203 | (685,902) |
Cash, cash equivalents and restricted cash at beginning of period | 5,844,409 | 7,804,618 | 6,055,111 | 8,238,870 |
Cash, cash equivalents and restricted cash at end of period | $ 6,140,314 | $ 7,552,968 | $ 6,140,314 | $ 7,552,968 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 6,113,733 | $ 6,027,804 |
Other current assets | 2,703,170 | 2,042,021 |
Total current assets | 8,816,903 | 8,069,825 |
Content assets, net | 32,777,340 | 30,919,539 |
Property and equipment, net | 1,372,754 | 1,323,453 |
Other non-current assets | 4,595,190 | 4,271,846 |
Total assets | 47,562,187 | 44,584,663 |
Current liabilities: | ||
Current content liabilities | 4,225,890 | 4,292,967 |
Accounts payable | 560,156 | 837,483 |
Accrued expenses and other liabilities | 1,803,555 | 1,449,351 |
Deferred revenue | 1,176,323 | 1,209,342 |
Short-term debt | 0 | 699,823 |
Total current liabilities | 7,765,924 | 8,488,966 |
Non-current content liabilities | 2,955,368 | 3,094,213 |
Long-term debt | 13,888,117 | 14,693,072 |
Other non-current liabilities | 2,424,637 | 2,459,164 |
Total liabilities | 27,034,046 | 28,735,415 |
Commitments and contingencies (Note 7) | ||
Stockholders’ equity: | ||
Common stock, $0.001 par value; 4,990,000,000 shares authorized at September 30, 2022 and December 31, 2021; 445,020,494 and 443,963,107 issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 4,473,962 | 4,024,561 |
Treasury stock at cost (1,564,478 shares at September 30, 2022) | (824,190) | (824,190) |
Accumulated other comprehensive loss | (247,643) | (40,495) |
Retained earnings | 17,126,012 | 12,689,372 |
Total stockholders’ equity | 20,528,141 | 15,849,248 |
Total liabilities and stockholders’ equity | $ 47,562,187 | $ 44,584,663 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (shares) | 4,990,000,000 | 4,990,000,000 |
Common stock, shares issued (shares) | 445,020,494 | 443,963,107 |
Common stock, shares outstanding (shares) | 445,020,494 | 443,963,107 |
Treasury stock (shares) | 1,564,478 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common stock and additional paid-in capital | Treasury Stock | Accumulated other comprehensive loss | Retained earnings |
Beginning balance at Dec. 31, 2020 | $ 11,065,240 | $ 3,447,698 | $ 0 | $ 44,398 | $ 7,573,144 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of options | 100,942 | ||||
Stock-based compensation expense | 303,891 | ||||
Repurchases of common stock to be held as treasury stock | (600,022) | ||||
Other comprehensive loss | (64,233) | ||||
Net income | 4,508,799 | 4,508,799 | |||
Ending balance at Sep. 30, 2021 | 15,314,617 | 3,852,531 | (600,022) | (19,835) | 12,081,943 |
Beginning balance at Jun. 30, 2021 | 13,863,871 | 3,721,246 | (500,022) | 9,775 | 10,632,872 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of options | 36,207 | ||||
Stock-based compensation expense | 95,078 | ||||
Repurchases of common stock to be held as treasury stock | (100,000) | ||||
Other comprehensive loss | (29,610) | ||||
Net income | 1,449,071 | 1,449,071 | |||
Ending balance at Sep. 30, 2021 | 15,314,617 | 3,852,531 | (600,022) | (19,835) | 12,081,943 |
Beginning balance at Dec. 31, 2021 | 15,849,248 | 4,024,561 | (824,190) | (40,495) | 12,689,372 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of options | 27,738 | ||||
Stock-based compensation expense | 421,663 | ||||
Other comprehensive loss | (207,148) | ||||
Net income | 4,436,640 | 4,436,640 | |||
Ending balance at Sep. 30, 2022 | 20,528,141 | 4,473,962 | (824,190) | (247,643) | 17,126,012 |
Beginning balance at Jun. 30, 2022 | 19,075,974 | 4,316,870 | (824,190) | (144,476) | 15,727,770 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of options | 5,030 | ||||
Stock-based compensation expense | 152,062 | ||||
Other comprehensive loss | (103,167) | ||||
Net income | 1,398,242 | 1,398,242 | |||
Ending balance at Sep. 30, 2022 | $ 20,528,141 | $ 4,473,962 | $ (824,190) | $ (247,643) | $ 17,126,012 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies The accompanying interim consolidated financial statements of Netflix, Inc. and its wholly owned subsidiaries (the “Company”) have been prepared in conformity with accounting principles generally accepted in the United States (“U.S.”) and are consistent in all material respects with those applied in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission (the “SEC”) on January 27, 2022. The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and judgments that affect the amounts reported in the consolidated financial statements and accompanying notes. Significant items subject to such estimates and assumptions include the content asset amortization policy and the recognition and measurement of income tax assets and liabilities. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. On a regular basis, the Company evaluates the assumptions, judgments and estimates. Actual results may differ from these estimates. The interim financial information is unaudited, but reflects all normal recurring adjustments that are, in the opinion of management, necessary to fairly present the information set forth herein. The interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Interim results are not necessarily indicative of the results for a full year. There have been no material changes in the Company’s significant accounting policies as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. Recently adopted accounting pronouncements In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , which requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers . The Company adopted ASU 2021-08 in the first quarter of 2022 and the adoption had no material impact to the Company’s consolidated financial statements. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company's primary source of revenues is from monthly membership fees. Members are billed in advance of the start of their monthly membership and revenues are recognized ratably over each monthly membership period. Revenues are presented net of the taxes that are collected from members and remitted to governmental authorities. The Company is the principal in all its relationships where partners, including consumer electronics (“CE”) manufacturers, multichannel video programming distributors (“MVPDs”), mobile operators and internet service providers (“ISPs”), provide access to the service as the Company retains control over service delivery to its members. Typically, payments made to the partners, such as for marketing, are expensed. However, if there is no distinct service provided in exchange for the payments made to the partners or if the price that the member pays is established by the partners and there is no standalone price for the Netflix service (for instance, in a bundle), these payments are recognized as a reduction of revenues. The following tables summarize streaming revenues, paid net membership additions, and paid memberships at end of period by region for the three and nine months ended September 30, 2022 and 2021, respectively: United States and Canada (UCAN) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 3,601,565 $ 3,257,697 $ 10,489,852 $ 9,663,312 Paid net membership additions (losses) 104 73 (1,828) 88 Paid memberships at end of period (1) 73,387 74,024 73,387 74,024 Europe, Middle East, and Africa (EMEA) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 2,375,814 $ 2,432,239 $ 7,394,880 $ 7,176,393 Paid net membership additions (losses) 568 1,804 (502) 3,802 Paid memberships at end of period (1) 73,534 70,500 73,534 70,500 Latin America (LATAM) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 1,023,945 $ 915,297 $ 3,053,127 $ 2,612,826 Paid net membership additions (losses) 312 330 (25) 1,451 Paid memberships at end of period (1) 39,936 38,988 39,936 38,988 Asia-Pacific (APAC) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 889,037 $ 834,002 $ 2,713,510 $ 2,395,896 Paid net membership additions 1,429 2,176 3,596 4,559 Paid memberships at end of period (1) 36,228 30,051 36,228 30,051 (1) A paid membership (also referred to as a paid subscription) is defined as a membership that has the right to receive Netflix service following sign-up and a method of payment being provided, and that is not part of a free trial or certain other promotions that may be offered by the Company to new or rejoining members. A membership is canceled and ceases to be reflected in the above metrics as of the effective cancellation date. Voluntary cancellations generally become effective at the end of the prepaid membership period. Involuntary cancellations, as a result of a failed method of payment, become effective immediately. Memberships are assigned to territories based on the geographic location used at time of sign-up as determined by the Company’s internal systems, which utilize industry standard geo-location technology. Total U.S. revenues, inclusive of DVD revenues not reported in the tables above, were $3.3 billion and $9.7 billion, respectively, for the three and nine months ended September 30, 2022 and $3.0 billion and $9.0 billion, respectively, for the three and nine months ended September 30, 2021. DVD revenues were $35 million and $112 million, respectively, for the three and nine months ended September 30, 2022 and $44 million and $140 million, respectively, for three and nine months ended September 30, 2021. Deferred revenue consists of membership fees billed that have not been recognized, as well as gift cards and other prepaid memberships that have not been fully redeemed. As of September 30, 2022, total deferred revenue was $1,176 million, the vast majority of which was related to membership fees billed that are expected to be recognized as revenue within the next month. The remaining deferred revenue balance, which is related to gift cards and other prepaid memberships, will be recognized as revenue over the period of service after redemption, which is expected to occur over the next 12 months. The $33 million decrease in deferred revenue as compared to the balance of $1,209 million as of December 31, 2021 is primarily due to a decrease in the purchase of gift cards, partially offset by an increase in average monthly revenue per paying member. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted earnings per share is computed using the weighted-average number of outstanding shares of common stock and, when dilutive, potential outstanding shares of common stock during the period. Potential shares of common stock consist of incremental shares issuable upon the assumed exercise of stock options. The computation of earnings per share is as follows: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands, except per share data) Basic earnings per share: Net income $ 1,398,242 $ 1,449,071 $ 4,436,640 $ 4,508,799 Shares used in computation: Weighted-average shares of common stock outstanding 444,878 442,778 444,529 443,052 Basic earnings per share $ 3.14 $ 3.27 $ 9.98 $ 10.18 Diluted earnings per share: Net income $ 1,398,242 $ 1,449,071 $ 4,436,640 $ 4,508,799 Shares used in computation: Weighted-average shares of common stock outstanding 444,878 442,778 444,529 443,052 Employee stock options 5,466 12,147 6,639 12,178 Weighted-average number of shares 450,344 454,925 451,168 455,230 Diluted earnings per share $ 3.10 $ 3.19 $ 9.83 $ 9.90 Employee stock options with exercise prices greater than the average market price of the common stock were excluded from the diluted calculation as their inclusion would have been anti-dilutive. The following table summarizes the potential shares of common stock excluded from the diluted calculation: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Employee stock options 8,536 279 6,487 441 |
Cash, Cash Equivalents and Rest
Cash, Cash Equivalents and Restricted Cash | 9 Months Ended |
Sep. 30, 2022 | |
Short-Term Investments And Fair Value Measurement [Abstract] | |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash The following tables summarize the Company's cash, cash equivalents, and restricted cash as of September 30, 2022 and December 31, 2021: As of September 30, 2022 Cash and cash equivalents Other Current Assets Non-current Assets Total (in thousands) Cash $ 5,363,669 $ 2,819 $ 23,641 $ 5,390,129 Level 1 securities: Money market funds 750,064 — 121 750,185 $ 6,113,733 $ 2,819 $ 23,762 $ 6,140,314 As of December 31, 2021 Cash and cash equivalents Other Current Assets Non-current Assets Total (in thousands) Cash $ 4,103,613 $ 3,189 $ 23,972 $ 4,130,774 Level 1 securities: Money market funds 1,924,191 — 146 1,924,337 $ 6,027,804 $ 3,189 $ 24,118 $ 6,055,111 Other current assets include restricted cash for deposits related to self insurance. Non-current assets include restricted cash related to letter of credit agreements. |
Balance Sheet Components
Balance Sheet Components | 9 Months Ended |
Sep. 30, 2022 | |
Balance Sheet Components Disclosure [Abstract] | |
Balance Sheet Components | Balance Sheet Components Content Assets, Net Content assets consisted of the following: As of September 30, December 31, (in thousands) Licensed content, net $ 12,571,064 $ 13,799,221 Produced content, net Released, less amortization 7,936,197 6,877,743 In production 11,484,835 9,235,975 In development and pre-production 785,244 1,006,600 20,206,276 17,120,318 Content assets, net $ 32,777,340 $ 30,919,539 As of September 30, 2022, approximately $5,500 million, $2,836 million, and $1,865 million of the $12,571 million unamortized cost of the licensed content is expected to be amortized in each of the next three years, respectively. As of September 30, 2022, approximately $3,131 million, $2,058 million, and $1,363 million of the $7,936 million unamortized cost of the produced content that has been released is expected to be amortized in each of the next three years, respectively. As of September 30, 2022, the amount of accrued participations and residuals was not material. The following tables represent the amortization of content assets: Three Months Ended September 30, September 30, (in thousands) Licensed content $ 1,967,720 $ 1,965,514 Produced content 1,685,872 997,537 Total $ 3,653,592 $ 2,963,051 Nine Months Ended September 30, September 30, (in thousands) Licensed content $ 5,751,940 $ 5,679,398 Produced content 4,329,365 2,809,652 Total $ 10,081,305 $ 8,489,050 Property and Equipment, Net Property and equipment and accumulated depreciation consisted of the following: As of September 30, December 31, Estimated Useful Lives (in thousands) Land $ 84,726 $ 82,381 Buildings 50,026 48,123 30 years Leasehold improvements 1,037,193 863,342 Over life of lease Furniture and fixtures 154,980 139,809 3 years Information technology 427,223 380,452 3 years Corporate aircraft 110,978 110,978 8 years Machinery and equipment 27,277 32,426 3-5 years Capital work-in-progress 190,373 282,248 Property and equipment, gross 2,082,776 1,939,759 Less: Accumulated depreciation (710,022) (616,306) Property and equipment, net $ 1,372,754 $ 1,323,453 Leases The Company has entered into operating leases primarily for real estate. Operating leases are included in "Other non-current assets" on the Company's Consolidated Balance Sheets, and represent the Company’s right to use the underlying asset for the lease term. The Company’s obligations to make lease payments are included in "Accrued expenses and other liabilities" and "Other non-current liabilities" on the Company's Consolidated Balance Sheets. The Company has also entered into various short-term operating leases, primarily for marketing billboards, with an initial term of twelve months or less. These leases are not recorded on the Company's Consolidated Balance Sheets. All operating lease expense is recognized on a straight-line basis over the lease term. Because the rate implicit in each lease is not readily determinable, the Company uses its incremental borrowing rate to determine the present value of the lease payments. Information related to the Company's operating right-of-use assets and related operating lease liabilities were as follows: Three Months Ended September 30, September 30, (in thousands) Cash paid for operating lease liabilities $ 105,848 $ 89,916 Right-of-use assets obtained in exchange for new operating lease obligations 2,938 252,377 Nine Months Ended September 30, 2022 September 30, 2021 (in thousands) Cash paid for operating lease liabilities $ 308,747 $ 251,827 Right-of-use assets obtained in exchange for new operating lease obligations 183,540 485,173 As of September 30, December 31, (in thousands) Operating lease right-of-use assets, net $ 2,211,507 $ 2,446,573 Current operating lease liabilities 334,339 315,189 Non-current operating lease liabilities 2,209,725 2,408,486 Total operating lease liabilities $ 2,544,064 $ 2,723,675 Other Current Assets Other current assets consisted of the following: As of September 30, December 31, (in thousands) Trade receivables $ 875,042 $ 804,320 Prepaid expenses 391,832 323,818 Other 1,436,296 913,883 Total other current assets $ 2,703,170 $ 2,042,021 The increase in Other was primarily due to a modification of a content licensing arrangement. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt As of September 30, 2022, the Company had aggregate outstanding notes of $13,888 million, net of $82 million of issuance costs, with varying maturities (the "Notes"). As of December 31, 2021, the Company had aggregate outstanding notes of $15,393 million, net of $92 million of issuance costs. Each of the Notes were issued at par and are senior unsecured obligations of the Company. Interest is payable semi-annually at fixed rates. A portion of the outstanding Notes is denominated in foreign currency (comprised of €5,170 million) and is remeasured into U.S. dollars at each balance sheet date (with remeasurement gain totaling $348 million and $815 million, respectively, for the three and nine months ended September 30, 2022). The following table provides a summary of the Company's outstanding debt and the fair values based on quoted market prices in less active markets as of September 30, 2022 and December 31, 2021: Principal Amount at Par Level 2 Fair Value as of September 30, December 31, Issuance Date Maturity September 30, December 31, (in millions) (in millions) 5.500% Senior Notes — 700 February 2015 February 2022 — 704 5.750% Senior Notes 400 400 February 2014 March 2024 407 437 5.875% Senior Notes 800 800 February 2015 February 2025 805 899 3.000% Senior Notes (1) 460 535 April 2020 June 2025 447 581 3.625% Senior Notes 500 500 April 2020 June 2025 473 529 4.375% Senior Notes 1,000 1,000 October 2016 November 2026 948 1,111 3.625% Senior Notes (1) 1,275 1,480 May 2017 May 2027 1,206 1,702 4.875% Senior Notes 1,600 1,600 October 2017 April 2028 1,501 1,829 5.875% Senior Notes 1,900 1,900 April 2018 November 2028 1,847 2,293 4.625% Senior Notes (1) 1,079 1,252 October 2018 May 2029 1,011 1,565 6.375% Senior Notes 800 800 October 2018 May 2029 798 999 3.875% Senior Notes (1) 1,177 1,366 April 2019 November 2029 1,041 1,651 5.375% Senior Notes 900 900 April 2019 November 2029 850 1,068 3.625% Senior Notes (1) 1,079 1,252 October 2019 June 2030 927 1,493 4.875% Senior Notes 1,000 1,000 October 2019 June 2030 914 1,169 $ 13,970 $ 15,485 $ 13,175 $ 18,030 (1) The following Senior Notes have a principal amount denominated in euro: 3.000% Senior Notes for €470 million, 3.625% Senior Notes for €1,300 million, 4.625% Senior Notes for €1,100 million, 3.875% Senior Notes for €1,200 million, and 3.625% Senior Notes for €1,100 million. In February 2022, the Company repaid upon maturity the $700 million aggregate principal amount of its 5.500% Senior Notes. Each of the Notes are repayable in whole or in part upon the occurrence of a change of control, at the option of the holders, at a purchase price in cash equal to 101% of the principal plus accrued interest. The Company may redeem the Notes prior to maturity in whole or in part at an amount equal to the principal amount thereof plus accrued and unpaid interest and an applicable premium. The Notes include, among other terms and conditions, limitations on the Company's ability to create, incur or allow certain liens; enter into sale and lease-back transactions; create, assume, incur or guarantee additional indebtedness of certain of the Company's subsidiaries; and consolidate or merge with, or convey, transfer or lease all or substantially all of the Company's and its subsidiaries assets, to another person. As of September 30, 2022 and December 31, 2021, the Company was in compliance with all related covenants. Revolving Credit Facility On June 17, 2021, the Company amended its unsecured revolving credit facility ("Revolving Credit Agreement") to, among other things, extend the maturity date from March 29, 2024 to June 17, 2026 and to increase the size of the facility from $750 million to $1 billion. Revolving loans may be borrowed, repaid and reborrowed until June 17, 2026, at which time all amounts borrowed must be repaid. The Company may use the proceeds of future borrowings under the Revolving Credit Agreement for working capital and general corporate purposes. As of September 30, 2022, no amounts have been borrowed under the Revolving Credit Agreement. Borrowings under the Revolving Credit Agreement bear interest, at the Company’s option, of either (i) a floating rate equal to a base rate (the “Alternate Base Rate”) or (ii) a rate equal to an adjusted London interbank offered rate (the “Adjusted LIBO Rate”), plus a margin of 0.75%. The Alternate Base Rate is defined as the greatest of (A) the rate of interest published by the Wall Street Journal, from time to time, as the prime rate, (B) the federal funds rate, plus 0.500% and (C) the Adjusted LIBO Rate for a one-month interest period, plus 1.00%. The Adjusted LIBO Rate is defined as the London interbank offered rate for deposits in U.S. dollars, for the relevant interest period, adjusted for statutory reserve requirements, but in no event shall the Adjusted LIBO Rate be less than 0.00% per annum. Regulatory authorities that oversee financial markets have announced that publication of the Adjusted LIBO Rate based upon U.S. Dollars is expected to cease on June 30, 2023. The Revolving Credit Agreement contains customary provisions for the replacement of the Adjusted LIBO Rate with an alternate benchmark rate, including a rate based on the secured overnight financing rate published by the Federal Reserve Bank of New York, as the Adjusted LIBO Rate is phased out in the lending market. The Company does not anticipate that the replacement of the Adjusted LIBO Rate with such alternative benchmark rate, as provided in the Revolving Credit Agreement, will materially impact its liquidity or financial position. The Company is also obligated to pay a commitment fee on the undrawn amounts of the Revolving Credit Agreement at an annual rate of 0.10%. The Revolving Credit Agreement requires the Company to comply with certain covenants, including covenants that limit or restrict the ability of the Company’s subsidiaries to incur debt and limit or restrict the ability of the Company and its subsidiaries to grant liens and enter into sale and leaseback transactions; and, in the case of the Company or a guarantor, merge, consolidate, liquidate, dissolve or sell, transfer, lease or otherwise dispose of all or substantially all of the assets of the Company and its subsidiaries, taken as a whole. As of September 30, 2022 and December 31, 2021, the Company was in compliance with all related covenants. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Content As of September 30, 2022, the Company had $21.6 billion of obligations comprised of $4.2 billion included in "Current content liabilities" and $3.0 billion of "Non-current content liabilities" on the Consolidated Balance Sheets and $14.4 billion of obligations that are not reflected on the Consolidated Balance Sheets as they did not yet meet the criteria for asset recognition. As of December 31, 2021, the Company had $23.2 billion of obligations comprised of $4.3 billion included in "Current content liabilities" and $3.1 billion of "Non-current content liabilities" on the Consolidated Balance Sheets and $15.8 billion of obligations that are not reflected on the Consolidated Balance Sheets as they did not yet meet the criteria for asset recognition. The expected timing of payments for these content obligations is as follows: As of September 30, December 31, (in thousands) Less than one year $ 9,667,326 $ 10,019,306 Due after one year and through three years 8,961,147 9,238,315 Due after three years and through five years 2,639,608 3,238,977 Due after five years 304,664 664,762 Total content obligations $ 21,572,745 $ 23,161,360 Content obligations include amounts related to the acquisition, licensing and production of content. Obligations that are in non-U.S. dollar currencies are translated to the U.S. dollar at period end rates. An obligation for the production of content includes non-cancelable commitments under creative talent and employment agreements as well as other production related commitments. An obligation for the acquisition and licensing of content is incurred at the time the Company enters into an agreement to obtain future titles. Once a title becomes available, a content liability is recorded on the Consolidated Balance Sheets. Certain agreements include the obligation to license rights for unknown future titles, the ultimate quantity and/or fees for which are not yet determinable as of the reporting date. Traditional film output deals, or certain TV series license agreements where the number of seasons to be aired is unknown, are examples of such license agreements. The Company does not include any estimated obligation for these future titles beyond the known minimum amount. However, the unknown obligations are expected to be significant. Legal Proceedings From time to time, in the normal course of its operations, the Company is subject to litigation matters and claims, including claims relating to employee relations, business practices and patent infringement. Litigation can be expensive and disruptive to normal business operations. Moreover, the results of complex legal proceedings are difficult to predict and the Company's view of these matters may change in the future as the litigation and events related thereto unfold. The Company expenses legal fees as incurred. The Company records a provision for contingent losses when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. An unfavorable outcome to any legal matter, if material, could have an adverse effect on the Company's operations or its financial position, liquidity or results of operations. The Company is involved in litigation matters not listed herein but does not consider the matters to be material either individually or in the aggregate at this time. The Company's view of the matters not listed may change in the future as the litigation and events related thereto unfold. Indemnification In the ordinary course of business, the Company has entered into contractual arrangements under which it has agreed to provide indemnification of varying scope and terms to business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of the Company’s breach of such agreements and out of intellectual property infringement claims made by third parties. In these circumstances, payment may be conditional on the other party making a claim pursuant to the procedures specified in the particular contract. The Company's obligations under these agreements may be limited in terms of time or amount, and in some instances, the Company may have recourse against third parties for certain payments. In addition, the Company has entered into indemnification agreements with its directors and certain of its officers that will require it, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors or officers. The terms of such obligations vary. It is not possible to make a reasonable estimate of the maximum potential amount of future payments under these or similar agreements due to the conditional nature of the Company’s obligations and the unique facts and circumstances involved in each particular agreement. No amount has been accrued in the accompanying consolidated financial statements with respect to these indemnification obligations. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Stock Option Plan In June 2020, the Company's stockholders approved the 2020 Stock Plan, which was adopted by the Company’s Board of Directors in March 2020 subject to stockholder approval. The 2020 Stock Plan is the successor to the 2011 Stock Plan and provides for the grant of incentive stock options to employees and for the grant of non-statutory stock options, stock appreciation rights, restricted stock and restricted stock units to employees, directors and consultants. A summary of the activities related to the Company’s stock option plans is as follows: Options Outstanding Shares Number of Weighted- Balances as of December 31, 2021 20,145,360 17,595,851 $ 219.83 Granted (2,812,627) 2,812,627 265.11 Exercised — (1,057,387) 26.26 Expired — (4,871) 11.35 Balances as of September 30, 2022 17,332,733 19,346,220 $ 237.05 The aggregate intrinsic value of the Company's outstanding stock options as of September 30, 2022 was $1,329 million and represents the total pretax intrinsic value (the difference between the Company’s closing stock price on the last trading day of the third quarter of 2022 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on the last trading day of the third quarter of 2022. This amount changes based on the fair market value of the Company’s common stock. The weighted-average remaining contractual term of the Company's outstanding stock options as of September 30, 2022 included in the table above was 5.58 years. All options outstanding are vested and exercisable. A summary of the amounts related to option exercises, is as follows: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Total intrinsic value of options exercised $ 65,087 $ 263,507 $ 262,879 $ 581,817 Cash received from options exercised 4,113 18,445 29,041 86,265 Stock-based Compensation Stock options granted are exercisable for the full ten year contractual term regardless of employment status. The following table summarizes the assumptions used to value option grants using the lattice-binomial model and the valuation data: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, Dividend yield — % — % — % — % Expected volatility 50 % 34 % 38% - 50% 34% - 41% Risk-free interest rate 2.98 % 1.37 % 1.71% - 2.98% 1.08% - 1.62% Suboptimal exercise factor 4.73 3.85 4.71 - 4.73 3.81 - 3.85 Weighted-average fair value (per share) $ 127 $ 240 $ 150 $ 250 Total stock-based compensation expense (in thousands) $ 152,062 $ 95,078 $ 421,663 $ 303,891 Total income tax impact on provision (in thousands) $ 33,724 $ 21,443 $ 93,472 $ 68,354 The Company considers several factors in determining the suboptimal exercise factor, including the historical and estimated option exercise behavior. The Company calculates expected volatility based solely on implied volatility. The Company believes that implied volatility of publicly traded options in its common stock is more reflective of market conditions, and given consistently high trade volumes of the options, can reasonably be expected to be a better indicator of expected volatility than historical volatility of its common stock. In valuing shares issued under the Company’s employee stock option plans, the Company bases the risk-free interest rate on U.S. Treasury zero-coupon issues with terms similar to the contractual term of the options. The Company does not anticipate paying any cash dividends in the foreseeable future and therefore uses an expected dividend yield of zero in the option valuation model. The Company does not use a post-vesting termination rate as options are fully vested upon grant date. Stock Repurchases |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands, except percentages) Provision for income taxes $ 223,605 $ 211,888 $ 787,953 $ 780,451 Effective tax rate 14 % 13 % 15 % 15 % The effective tax rate for the three months ended September 30, 2022 differed from the Federal statutory rate primarily due to the impact of international provisions of the Tax Cuts and Jobs Act, the Federal and California Research and Development (“R&D”) credits, and the recognition of excess tax benefits of stock-based compensation. The effective tax rate for the nine months ended September 30, 2022 differed from the Federal statutory rate primarily due to an increase in foreign taxes, offset by the impact of international provisions of the Tax Cuts and Jobs Act, the Federal and California R&D credits, and the recognition of excess tax benefits of stock-based compensation. The effective tax rates for the three and nine months ended September 30, 2021 differed from the Federal statutory rate primarily due to the impact of international provisions of the Tax Cuts and Jobs Act and recognition of excess tax benefits of stock-based compensation. The increase in the effective tax rate for the three months ended September 30, 2022, as compared to the same period in 2021 was primarily due to a reduction in excess tax benefits of stock-based compensation. The effective tax rate for the nine months ended September 30, 2022 was consistent compared to the same period in 2021. For the three and nine months ended September 30, 2022, the Company recognized a discrete tax benefit related to the excess tax benefits from stock-based compensation of $14 million and $57 million, respectively, compared to the three and nine months ended September 30, 2021 of $57 million and $123 million, respectively. Gross unrecognized tax benefits were $230 million and $203 million as of September 30, 2022 and December 31, 2021, respectively. The gross unrecognized tax benefits as of September 30, 2022, if recognized by the Company, will result in a reduction of approximately $152 million to the provision for income taxes thereby favorably impacting the Company’s effective tax rate. The Company files U.S. Federal, state and foreign tax returns. The Company is currently under examination by the IRS for 2016 through 2018 and is subject to examination for 2019 through 2021. The foreign and state tax returns for years 2015 through 2021 are subject to examination by various states and foreign jurisdictions. Given the potential outcome of the current examination, as well as the impact of the current examination on the potential expiration of the statute of limitations, it is reasonably possible that the balance of unrecognized tax benefits could significantly change within the next twelve months. However, an estimate of the range of reasonably possible adjustments cannot be made at this time. |
Segment and Geographic Informat
Segment and Geographic Information | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information The Company operates as one operating segment. The Company's chief operating decision maker ("CODM") are its co-chief executive officers, who review financial information presented on a consolidated basis for the purposes of making operating decisions, assessing financial performance and allocating resources. Total U.S. revenues were $3.3 billion and $9.7 billion, respectively, for the three and nine months ended September 30, 2022, and $3.0 billion and $9.0 billion, respectively, for the three and nine months ended September 30, 2021. See Note 2 Revenue Recognition for additional information about streaming revenue by region. The Company's long-lived tangible assets, as well as the Company's operating lease right-of-use assets recognized on the Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021, were located as follows: As of September 30, December 31, (in thousands) United States $ 2,785,303 $ 2,833,059 International 798,958 936,967 |
Subsequent Event
Subsequent Event | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent EventOn October 3, 2022, the Company completed the acquisition of Animal Logic, an Australian animation studio. The Company anticipates accounting for the transaction as a business combination. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Use of estimates | The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and judgments that affect the amounts reported in the consolidated financial statements and accompanying notes. Significant items subject to such estimates and assumptions include the content asset amortization policy and the recognition and measurement of income tax assets and liabilities. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. On a regular basis, the Company evaluates the assumptions, judgments and estimates. Actual results may differ from these estimates. |
Recently adopted accounting pronouncements | Recently adopted accounting pronouncements In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers , which requires an acquirer in a business combination to recognize and measure contract assets and contract liabilities in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers . The Company adopted ASU 2021-08 in the first quarter of 2022 and the adoption had no material impact to the Company’s consolidated financial statements. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Streaming Revenue, Paid net Membership Additions, and Ending Paid Memberships by Region | The following tables summarize streaming revenues, paid net membership additions, and paid memberships at end of period by region for the three and nine months ended September 30, 2022 and 2021, respectively: United States and Canada (UCAN) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 3,601,565 $ 3,257,697 $ 10,489,852 $ 9,663,312 Paid net membership additions (losses) 104 73 (1,828) 88 Paid memberships at end of period (1) 73,387 74,024 73,387 74,024 Europe, Middle East, and Africa (EMEA) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 2,375,814 $ 2,432,239 $ 7,394,880 $ 7,176,393 Paid net membership additions (losses) 568 1,804 (502) 3,802 Paid memberships at end of period (1) 73,534 70,500 73,534 70,500 Latin America (LATAM) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 1,023,945 $ 915,297 $ 3,053,127 $ 2,612,826 Paid net membership additions (losses) 312 330 (25) 1,451 Paid memberships at end of period (1) 39,936 38,988 39,936 38,988 Asia-Pacific (APAC) As of/ Three Months Ended As of/ Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Revenues $ 889,037 $ 834,002 $ 2,713,510 $ 2,395,896 Paid net membership additions 1,429 2,176 3,596 4,559 Paid memberships at end of period (1) 36,228 30,051 36,228 30,051 (1) A paid membership (also referred to as a paid subscription) is defined as a membership that has the right to receive Netflix service following sign-up and a method of payment being provided, and that is not part of a free trial or certain other promotions that may be offered by the Company to new or rejoining members. A membership is canceled and ceases to be reflected in the above metrics as of the effective cancellation date. Voluntary cancellations generally become effective at the end of the prepaid membership period. Involuntary cancellations, as a result of a failed method of payment, become effective immediately. Memberships are assigned to territories based on the geographic location used at time of sign-up as determined by the Company’s internal systems, which utilize industry standard geo-location technology. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Computation of Earnings Per Share | The computation of earnings per share is as follows: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands, except per share data) Basic earnings per share: Net income $ 1,398,242 $ 1,449,071 $ 4,436,640 $ 4,508,799 Shares used in computation: Weighted-average shares of common stock outstanding 444,878 442,778 444,529 443,052 Basic earnings per share $ 3.14 $ 3.27 $ 9.98 $ 10.18 Diluted earnings per share: Net income $ 1,398,242 $ 1,449,071 $ 4,436,640 $ 4,508,799 Shares used in computation: Weighted-average shares of common stock outstanding 444,878 442,778 444,529 443,052 Employee stock options 5,466 12,147 6,639 12,178 Weighted-average number of shares 450,344 454,925 451,168 455,230 Diluted earnings per share $ 3.10 $ 3.19 $ 9.83 $ 9.90 |
Summary of Potential Common Shares Excluded from the Diluted Calculation | The following table summarizes the potential shares of common stock excluded from the diluted calculation: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Employee stock options 8,536 279 6,487 441 |
Cash, Cash Equivalents and Re_2
Cash, Cash Equivalents and Restricted Cash (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Short-Term Investments And Fair Value Measurement [Abstract] | |
Summary of Cash and Cash Equivalents and Restricted Cash | The following tables summarize the Company's cash, cash equivalents, and restricted cash as of September 30, 2022 and December 31, 2021: As of September 30, 2022 Cash and cash equivalents Other Current Assets Non-current Assets Total (in thousands) Cash $ 5,363,669 $ 2,819 $ 23,641 $ 5,390,129 Level 1 securities: Money market funds 750,064 — 121 750,185 $ 6,113,733 $ 2,819 $ 23,762 $ 6,140,314 As of December 31, 2021 Cash and cash equivalents Other Current Assets Non-current Assets Total (in thousands) Cash $ 4,103,613 $ 3,189 $ 23,972 $ 4,130,774 Level 1 securities: Money market funds 1,924,191 — 146 1,924,337 $ 6,027,804 $ 3,189 $ 24,118 $ 6,055,111 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Balance Sheet Components Disclosure [Abstract] | |
Summary of Content Assets | Content assets consisted of the following: As of September 30, December 31, (in thousands) Licensed content, net $ 12,571,064 $ 13,799,221 Produced content, net Released, less amortization 7,936,197 6,877,743 In production 11,484,835 9,235,975 In development and pre-production 785,244 1,006,600 20,206,276 17,120,318 Content assets, net $ 32,777,340 $ 30,919,539 |
Summary of Amortization of Streaming Content Assets | The following tables represent the amortization of content assets: Three Months Ended September 30, September 30, (in thousands) Licensed content $ 1,967,720 $ 1,965,514 Produced content 1,685,872 997,537 Total $ 3,653,592 $ 2,963,051 Nine Months Ended September 30, September 30, (in thousands) Licensed content $ 5,751,940 $ 5,679,398 Produced content 4,329,365 2,809,652 Total $ 10,081,305 $ 8,489,050 |
Summary of Property and Equipment, Net | Property and equipment and accumulated depreciation consisted of the following: As of September 30, December 31, Estimated Useful Lives (in thousands) Land $ 84,726 $ 82,381 Buildings 50,026 48,123 30 years Leasehold improvements 1,037,193 863,342 Over life of lease Furniture and fixtures 154,980 139,809 3 years Information technology 427,223 380,452 3 years Corporate aircraft 110,978 110,978 8 years Machinery and equipment 27,277 32,426 3-5 years Capital work-in-progress 190,373 282,248 Property and equipment, gross 2,082,776 1,939,759 Less: Accumulated depreciation (710,022) (616,306) Property and equipment, net $ 1,372,754 $ 1,323,453 |
Summary of Information on Right-of-Use Assets and Lease Liabilities | Information related to the Company's operating right-of-use assets and related operating lease liabilities were as follows: Three Months Ended September 30, September 30, (in thousands) Cash paid for operating lease liabilities $ 105,848 $ 89,916 Right-of-use assets obtained in exchange for new operating lease obligations 2,938 252,377 Nine Months Ended September 30, 2022 September 30, 2021 (in thousands) Cash paid for operating lease liabilities $ 308,747 $ 251,827 Right-of-use assets obtained in exchange for new operating lease obligations 183,540 485,173 As of September 30, December 31, (in thousands) Operating lease right-of-use assets, net $ 2,211,507 $ 2,446,573 Current operating lease liabilities 334,339 315,189 Non-current operating lease liabilities 2,209,725 2,408,486 Total operating lease liabilities $ 2,544,064 $ 2,723,675 |
Summary of Other Current Assets | Other current assets consisted of the following: As of September 30, December 31, (in thousands) Trade receivables $ 875,042 $ 804,320 Prepaid expenses 391,832 323,818 Other 1,436,296 913,883 Total other current assets $ 2,703,170 $ 2,042,021 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Summary of Long-term Debt | The following table provides a summary of the Company's outstanding debt and the fair values based on quoted market prices in less active markets as of September 30, 2022 and December 31, 2021: Principal Amount at Par Level 2 Fair Value as of September 30, December 31, Issuance Date Maturity September 30, December 31, (in millions) (in millions) 5.500% Senior Notes — 700 February 2015 February 2022 — 704 5.750% Senior Notes 400 400 February 2014 March 2024 407 437 5.875% Senior Notes 800 800 February 2015 February 2025 805 899 3.000% Senior Notes (1) 460 535 April 2020 June 2025 447 581 3.625% Senior Notes 500 500 April 2020 June 2025 473 529 4.375% Senior Notes 1,000 1,000 October 2016 November 2026 948 1,111 3.625% Senior Notes (1) 1,275 1,480 May 2017 May 2027 1,206 1,702 4.875% Senior Notes 1,600 1,600 October 2017 April 2028 1,501 1,829 5.875% Senior Notes 1,900 1,900 April 2018 November 2028 1,847 2,293 4.625% Senior Notes (1) 1,079 1,252 October 2018 May 2029 1,011 1,565 6.375% Senior Notes 800 800 October 2018 May 2029 798 999 3.875% Senior Notes (1) 1,177 1,366 April 2019 November 2029 1,041 1,651 5.375% Senior Notes 900 900 April 2019 November 2029 850 1,068 3.625% Senior Notes (1) 1,079 1,252 October 2019 June 2030 927 1,493 4.875% Senior Notes 1,000 1,000 October 2019 June 2030 914 1,169 $ 13,970 $ 15,485 $ 13,175 $ 18,030 (1) The following Senior Notes have a principal amount denominated in euro: 3.000% Senior Notes for €470 million, 3.625% Senior Notes for €1,300 million, 4.625% Senior Notes for €1,100 million, 3.875% Senior Notes for €1,200 million, and 3.625% Senior Notes for €1,100 million. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Expected Timing of Payments for Content Obligations | The expected timing of payments for these content obligations is as follows: As of September 30, December 31, (in thousands) Less than one year $ 9,667,326 $ 10,019,306 Due after one year and through three years 8,961,147 9,238,315 Due after three years and through five years 2,639,608 3,238,977 Due after five years 304,664 664,762 Total content obligations $ 21,572,745 $ 23,161,360 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Stockholders' Equity Note [Abstract] | |
Summary of Activity Related to Stock Option Plans | A summary of the activities related to the Company’s stock option plans is as follows: Options Outstanding Shares Number of Weighted- Balances as of December 31, 2021 20,145,360 17,595,851 $ 219.83 Granted (2,812,627) 2,812,627 265.11 Exercised — (1,057,387) 26.26 Expired — (4,871) 11.35 Balances as of September 30, 2022 17,332,733 19,346,220 $ 237.05 |
Summary of Amounts Related to Option Exercises | A summary of the amounts related to option exercises, is as follows: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands) Total intrinsic value of options exercised $ 65,087 $ 263,507 $ 262,879 $ 581,817 Cash received from options exercised 4,113 18,445 29,041 86,265 |
Summary of Assumptions Used to Value Stock Option Grants Using Lattice-Binomial Model | The following table summarizes the assumptions used to value option grants using the lattice-binomial model and the valuation data: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, Dividend yield — % — % — % — % Expected volatility 50 % 34 % 38% - 50% 34% - 41% Risk-free interest rate 2.98 % 1.37 % 1.71% - 2.98% 1.08% - 1.62% Suboptimal exercise factor 4.73 3.85 4.71 - 4.73 3.81 - 3.85 Weighted-average fair value (per share) $ 127 $ 240 $ 150 $ 250 Total stock-based compensation expense (in thousands) $ 152,062 $ 95,078 $ 421,663 $ 303,891 Total income tax impact on provision (in thousands) $ 33,724 $ 21,443 $ 93,472 $ 68,354 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Summary of Components of Income Tax Expense | Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, (in thousands, except percentages) Provision for income taxes $ 223,605 $ 211,888 $ 787,953 $ 780,451 Effective tax rate 14 % 13 % 15 % 15 % |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Summary of Long-lived Assets by Geographic Areas | The Company's long-lived tangible assets, as well as the Company's operating lease right-of-use assets recognized on the Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021, were located as follows: As of September 30, December 31, (in thousands) United States $ 2,785,303 $ 2,833,059 International 798,958 936,967 |
Revenue Recognition - Revenue a
Revenue Recognition - Revenue and Membership Information (Details) membership in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) membership | Sep. 30, 2021 USD ($) membership | Sep. 30, 2022 USD ($) membership | Sep. 30, 2021 USD ($) membership | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ | $ 7,925,589 | $ 7,483,467 | $ 23,763,497 | $ 21,988,526 |
Streaming | United States and Canada | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ | $ 3,601,565 | $ 3,257,697 | $ 10,489,852 | $ 9,663,312 |
Paid net membership additions (losses) (in memberships) | 104 | 73 | (1,828) | 88 |
Paid memberships at end of period (in memberships) | 73,387 | 74,024 | 73,387 | 74,024 |
Streaming | Europe, Middle East, and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ | $ 2,375,814 | $ 2,432,239 | $ 7,394,880 | $ 7,176,393 |
Paid net membership additions (losses) (in memberships) | 568 | 1,804 | (502) | 3,802 |
Paid memberships at end of period (in memberships) | 73,534 | 70,500 | 73,534 | 70,500 |
Streaming | Latin America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ | $ 1,023,945 | $ 915,297 | $ 3,053,127 | $ 2,612,826 |
Paid net membership additions (losses) (in memberships) | 312 | 330 | (25) | 1,451 |
Paid memberships at end of period (in memberships) | 39,936 | 38,988 | 39,936 | 38,988 |
Streaming | Asia-Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ | $ 889,037 | $ 834,002 | $ 2,713,510 | $ 2,395,896 |
Paid net membership additions (losses) (in memberships) | 1,429 | 2,176 | 3,596 | 4,559 |
Paid memberships at end of period (in memberships) | 36,228 | 30,051 | 36,228 | 30,051 |
Revenue Recognition - Additiona
Revenue Recognition - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||||
Revenues | $ 7,925,589 | $ 7,483,467 | $ 23,763,497 | $ 21,988,526 | |
Deferred revenue | 1,176,323 | 1,176,323 | $ 1,209,342 | ||
Increase in deferred revenue | (33,000) | ||||
DVD | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | 35,000 | 44,000 | 112,000 | 140,000 | |
United States | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenues | $ 3,300,000 | $ 3,000,000 | $ 9,700,000 | $ 9,000,000 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Basic earnings per share: | ||||
Net income | $ 1,398,242 | $ 1,449,071 | $ 4,436,640 | $ 4,508,799 |
Weighted-average shares of common stock outstanding (in shares) | 444,878 | 442,778 | 444,529 | 443,052 |
Basic earnings per share (dollars per share) | $ 3.14 | $ 3.27 | $ 9.98 | $ 10.18 |
Diluted earnings per share: | ||||
Net income | $ 1,398,242 | $ 1,449,071 | $ 4,436,640 | $ 4,508,799 |
Shares used in computation: | ||||
Weighted-average shares of common stock outstanding (in shares) | 444,878 | 442,778 | 444,529 | 443,052 |
Employee stock options (in shares) | 5,466 | 12,147 | 6,639 | 12,178 |
Weighted-average number of shares (in shares) | 450,344 | 454,925 | 451,168 | 455,230 |
Diluted earnings per share (dollars per share) | $ 3.10 | $ 3.19 | $ 9.83 | $ 9.90 |
Earnings Per Share - Antidiluti
Earnings Per Share - Antidilutive Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Employee stock options (in shares) | 8,536 | 279 | 6,487 | 441 |
Cash, Cash Equivalents and Re_3
Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | $ 6,140,314 | $ 5,844,409 | $ 6,055,111 | $ 7,552,968 | $ 7,804,618 | $ 8,238,870 |
Cash and cash equivalents | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 6,113,733 | 6,027,804 | ||||
Other Current Assets | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 2,819 | 3,189 | ||||
Non-current Assets | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 23,762 | 24,118 | ||||
Cash | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 5,390,129 | 4,130,774 | ||||
Cash | Cash and cash equivalents | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 5,363,669 | 4,103,613 | ||||
Cash | Other Current Assets | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 2,819 | 3,189 | ||||
Cash | Non-current Assets | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 23,641 | 23,972 | ||||
Money market funds | Level 1 Securities | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 750,185 | 1,924,337 | ||||
Money market funds | Cash and cash equivalents | Level 1 Securities | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 750,064 | 1,924,191 | ||||
Money market funds | Other Current Assets | Level 1 Securities | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | 0 | 0 | ||||
Money market funds | Non-current Assets | Level 1 Securities | ||||||
Cash and Cash Equivalents [Line Items] | ||||||
Cash, cash equivalents, and restricted cash | $ 121 | $ 146 |
Balance Sheet Components - Comp
Balance Sheet Components - Components of Content Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Content assets, net | $ 32,777,340 | $ 32,777,340 | $ 30,919,539 | ||
Amortization of content assets | 3,653,592 | $ 2,963,051 | 10,081,305 | $ 8,489,050 | |
Licensed content, net | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Net content | 12,571,064 | 12,571,064 | 13,799,221 | ||
Unamortized cost in year one | 5,500,000 | 5,500,000 | |||
Unamortized cost in year two | 2,836,000 | 2,836,000 | |||
Unamortized cost in year three | 1,865,000 | 1,865,000 | |||
Amortization of content assets | 1,967,720 | 1,965,514 | 5,751,940 | 5,679,398 | |
Produced content, net | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Net content | 7,936,197 | 7,936,197 | 6,877,743 | ||
In production | 11,484,835 | 11,484,835 | 9,235,975 | ||
In development and pre-production | 785,244 | 785,244 | 1,006,600 | ||
Content assets, net | 20,206,276 | 20,206,276 | $ 17,120,318 | ||
Unamortized cost in year one | 3,131,000 | 3,131,000 | |||
Unamortized cost in year two | 2,058,000 | 2,058,000 | |||
Unamortized cost in year three | 1,363,000 | 1,363,000 | |||
Amortization of content assets | $ 1,685,872 | $ 997,537 | $ 4,329,365 | $ 2,809,652 |
Balance Sheet Components - Prop
Balance Sheet Components - Property And Equipment (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,082,776 | $ 1,939,759 |
Less: Accumulated depreciation | (710,022) | (616,306) |
Property and equipment, net | 1,372,754 | 1,323,453 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 84,726 | 82,381 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 50,026 | 48,123 |
Estimated Useful Lives | 30 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 1,037,193 | 863,342 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 154,980 | 139,809 |
Estimated Useful Lives | 3 years | |
Information technology | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 427,223 | 380,452 |
Estimated Useful Lives | 3 years | |
Corporate aircraft | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 110,978 | 110,978 |
Estimated Useful Lives | 8 years | |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 27,277 | 32,426 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 3 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Lives | 5 years | |
Capital work-in-progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 190,373 | $ 282,248 |
Balance Sheet Components - Leas
Balance Sheet Components - Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Leases [Abstract] | |||||
Cash paid for operating lease liabilities | $ 105,848 | $ 89,916 | $ 308,747 | $ 251,827 | |
Right-of-use assets obtained in exchange for new operating lease obligations | 2,938 | $ 252,377 | 183,540 | $ 485,173 | |
Operating lease right-of-use assets, net | 2,211,507 | 2,211,507 | $ 2,446,573 | ||
Current operating lease liabilities | 334,339 | 334,339 | 315,189 | ||
Non-current operating lease liabilities | 2,209,725 | 2,209,725 | 2,408,486 | ||
Total operating lease liabilities | $ 2,544,064 | $ 2,544,064 | $ 2,723,675 | ||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other non-current assets | Other non-current assets | Other non-current assets | ||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued Liabilities, Current | Accrued Liabilities, Current | Accrued Liabilities, Current | ||
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other non-current liabilities | Other non-current liabilities | Other non-current liabilities |
Balance Sheet Components - Othe
Balance Sheet Components - Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Balance Sheet Components Disclosure [Abstract] | ||
Trade receivables | $ 875,042 | $ 804,320 |
Prepaid expenses | 391,832 | 323,818 |
Other | 1,436,296 | 913,883 |
Total other current assets | $ 2,703,170 | $ 2,042,021 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Feb. 28, 2022 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 EUR (€) | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | |||||||
Aggregate outstanding notes | $ 13,888,000,000 | $ 13,888,000,000 | $ 15,393,000,000 | ||||
Debt issuance costs | 82,000,000 | 82,000,000 | 92,000,000 | ||||
Long-term notes denominated in foreign currency | 13,970,000,000 | 13,970,000,000 | 15,485,000,000 | ||||
Foreign currency transaction gain (loss) | 348,458,000 | $ 136,488,000 | 814,792,000 | $ 326,744,000 | |||
Repayments of debt | 0 | $ 0 | 700,000,000 | $ 500,000,000 | |||
Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Long-term notes denominated in foreign currency | € | € 5,170,000,000 | ||||||
Foreign currency transaction gain (loss) | 348,000,000 | $ 815,000,000 | |||||
Redemption prices, percent of outstanding principal | 101% | ||||||
Senior Notes | 5.500% Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Long-term notes denominated in foreign currency | $ 0 | $ 0 | $ 700,000,000 | ||||
Repayments of debt | $ 700,000,000 | ||||||
Interest rate | 5.50% | 5.50% | 5.50% | 5.50% | 5.50% |
Debt - Summary of Long-term Deb
Debt - Summary of Long-term Debt (Details) | Sep. 30, 2022 EUR (€) | Sep. 30, 2022 USD ($) | Feb. 28, 2022 | Dec. 31, 2021 EUR (€) | Dec. 31, 2021 USD ($) |
Debt Instrument [Line Items] | |||||
Face amount | $ 13,970,000,000 | $ 15,485,000,000 | |||
Long-term debt, fair value | $ 13,175,000,000 | $ 18,030,000,000 | |||
Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Face amount | € | € 5,170,000,000 | ||||
Senior Notes | 5.500% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.50% | 5.50% | 5.50% | 5.50% | 5.50% |
Face amount | $ 0 | $ 700,000,000 | |||
Long-term debt, fair value | $ 0 | $ 704,000,000 | |||
Senior Notes | 5.750% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.75% | 5.75% | 5.75% | 5.75% | |
Face amount | $ 400,000,000 | $ 400,000,000 | |||
Long-term debt, fair value | $ 407,000,000 | $ 437,000,000 | |||
Senior Notes | 5.875% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.875% | 5.875% | 5.875% | 5.875% | |
Face amount | $ 800,000,000 | $ 800,000,000 | |||
Long-term debt, fair value | $ 805,000,000 | $ 899,000,000 | |||
Senior Notes | 3.000% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 3% | 3% | 3% | 3% | |
Face amount | € 470,000,000 | $ 460,000,000 | € 470,000,000 | $ 535,000,000 | |
Long-term debt, fair value | $ 447,000,000 | $ 581,000,000 | |||
Senior Notes | 3.625% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 3.625% | 3.625% | 3.625% | 3.625% | |
Face amount | $ 500,000,000 | $ 500,000,000 | |||
Long-term debt, fair value | $ 473,000,000 | $ 529,000,000 | |||
Senior Notes | 4.375% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 4.375% | 4.375% | 4.375% | 4.375% | |
Face amount | $ 1,000,000,000 | $ 1,000,000,000 | |||
Long-term debt, fair value | $ 948,000,000 | $ 1,111,000,000 | |||
Senior Notes | 3.625% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 3.625% | 3.625% | 3.625% | 3.625% | |
Face amount | € 1,300,000,000 | $ 1,275,000,000 | € 1,300,000,000 | $ 1,480,000,000 | |
Long-term debt, fair value | $ 1,206,000,000 | $ 1,702,000,000 | |||
Senior Notes | 4.875% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 4.875% | 4.875% | 4.875% | 4.875% | |
Face amount | $ 1,600,000,000 | $ 1,600,000,000 | |||
Long-term debt, fair value | $ 1,501,000,000 | $ 1,829,000,000 | |||
Senior Notes | 5.875% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.875% | 5.875% | 5.875% | 5.875% | |
Face amount | $ 1,900,000,000 | $ 1,900,000,000 | |||
Long-term debt, fair value | $ 1,847,000,000 | $ 2,293,000,000 | |||
Senior Notes | 4.625% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 4.625% | 4.625% | 4.625% | 4.625% | |
Face amount | € 1,100,000,000 | $ 1,079,000,000 | € 1,100,000,000 | $ 1,252,000,000 | |
Long-term debt, fair value | $ 1,011,000,000 | $ 1,565,000,000 | |||
Senior Notes | 6.375% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 6.375% | 6.375% | 6.375% | 6.375% | |
Face amount | $ 800,000,000 | $ 800,000,000 | |||
Long-term debt, fair value | $ 798,000,000 | $ 999,000,000 | |||
Senior Notes | 3.875% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 3.875% | 3.875% | 3.875% | 3.875% | |
Face amount | € 1,200,000,000 | $ 1,177,000,000 | € 1,200,000,000 | $ 1,366,000,000 | |
Long-term debt, fair value | $ 1,041,000,000 | $ 1,651,000,000 | |||
Senior Notes | 5.375% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.375% | 5.375% | 5.375% | 5.375% | |
Face amount | $ 900,000,000 | $ 900,000,000 | |||
Long-term debt, fair value | $ 850,000,000 | $ 1,068,000,000 | |||
Senior Notes | 3.625% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 3.625% | 3.625% | 3.625% | 3.625% | |
Face amount | € 1,100,000,000 | $ 1,079,000,000 | € 1,100,000,000 | $ 1,252,000,000 | |
Long-term debt, fair value | $ 927,000,000 | $ 1,493,000,000 | |||
Senior Notes | 4.875% Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 4.875% | 4.875% | 4.875% | 4.875% | |
Face amount | $ 1,000,000,000 | $ 1,000,000,000 | |||
Long-term debt, fair value | $ 914,000,000 | $ 1,169,000,000 |
Debt - Revolving Line of Credit
Debt - Revolving Line of Credit (Details) - Revolving Credit Facility - USD ($) | 9 Months Ended | ||
Sep. 30, 2022 | Jun. 17, 2021 | Jun. 16, 2021 | |
Line of Credit Facility [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 1,000,000,000 | $ 750,000,000 | |
Amount borrowed | $ 0 | ||
Commitment fee percentage | 0.10% | ||
LIBOR | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.75% | ||
Federal Funds Rate | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
One-month LIBOR | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 1% | ||
One-month LIBOR | Minimum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0% |
Commitments and Contingencies -
Commitments and Contingencies - Streaming Content (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Contractual Obligation [Line Items] | ||
Total streaming content obligations | $ 21,572,745 | $ 23,161,360 |
Current content liabilities | 4,225,890 | 4,292,967 |
Non-current content liabilities | 2,955,368 | 3,094,213 |
Unrecorded streaming obligations | 14,400,000 | 15,800,000 |
Current content liabilities | ||
Contractual Obligation [Line Items] | ||
Current content liabilities | 4,200,000 | 4,300,000 |
Non-current content liabilities | ||
Contractual Obligation [Line Items] | ||
Non-current content liabilities | $ 3,000,000 | $ 3,100,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Expected Timing of Payments for Content Obligations (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Less than one year | $ 9,667,326 | $ 10,019,306 |
Due after one year and through three years | 8,961,147 | 9,238,315 |
Due after three years and through five years | 2,639,608 | 3,238,977 |
Due after five years | 304,664 | 664,762 |
Total content obligations | $ 21,572,745 | $ 23,161,360 |
Commitments and Contingencies_3
Commitments and Contingencies - Indemnification (Details) | Sep. 30, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Indemnification obligations | $ 0 |
Stockholders' Equity - Activity
Stockholders' Equity - Activity Related to Stock Option Plans (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Shares available for grant, beginning balance (in shares) | 20,145,360 |
Options outstanding, number of shares, beginning balance (in shares) | 17,595,851 |
Options outstanding, number of shares granted (in shares) | 2,812,627 |
Options outstanding, number of shares, exercised (in shares) | (1,057,387) |
Options outstanding, number of shares, expired (in shares) | (4,871) |
Shares available for grant, ending balance (in shares) | 17,332,733 |
Options outstanding, number of shares, ending balance (in shares) | 19,346,220 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |
Options outstanding, weighted-average exercise price, beginning balance (dollars per share) | $ / shares | $ 219.83 |
Options outstanding, weighted-average exercise price, granted (dollars per share) | $ / shares | 265.11 |
Options outstanding, weighted-average exercise price, exercised (dollars per share) | $ / shares | 26.26 |
Options expired, weighted-average exercise price (dollars per share) | $ / shares | 11.35 |
Options outstanding, weighted-average exercise price, ending balance (dollars per share) | $ / shares | $ 237.05 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Plan Narrative (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Stockholders' Equity Note [Abstract] | |
Aggregate intrinsic value | $ 1,329 |
Weighted-average remaining contractual term (in years) | 5 years 6 months 29 days |
Stockholders' Equity - Amounts
Stockholders' Equity - Amounts Related to Option Exercises (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | ||||
Total intrinsic value of options exercised | $ 65,087 | $ 263,507 | $ 262,879 | $ 581,817 |
Cash received from options exercised | $ 4,113 | $ 18,445 | $ 29,041 | $ 86,265 |
Stockholders' Equity - Stock-ba
Stockholders' Equity - Stock-based Compensation Narrative (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | ||||
Share-based payment award, expiration period (in years) | 10 years | |||
Dividend yield | 0% | 0% | 0% | 0% |
Stockholders' Equity - Assumpti
Stockholders' Equity - Assumptions Used to Value Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Stockholders' Equity Note [Abstract] | ||||
Dividend yield | 0% | 0% | 0% | 0% |
Expected volatility | 50% | 34% | ||
Expected volatility, minimum | 38% | 34% | ||
Expected volatility, maximum | 50% | 41% | ||
Risk-free interest rate | 2.98% | 1.37% | ||
Risk-free interest rate, minimum | 1.71% | 1.08% | ||
Risk-free interest rate, maximum | 2.98% | 1.62% | ||
Suboptimal exercise factor | 4.73 | 3.85 | ||
Suboptimal exercise factor, minimum | 4.71 | 3.81 | ||
Suboptimal exercise factor, maximum | 4.73 | 3.85 | ||
Weighted-average fair value (dollars per share) | $ 127 | $ 240 | $ 150 | $ 250 |
Total stock-based compensation expense | $ 152,062 | $ 95,078 | $ 421,663 | $ 303,891 |
Total income tax impact on provision | $ 33,724 | $ 21,443 | $ 93,472 | $ 68,354 |
Stockholders' Equity - Stock Re
Stockholders' Equity - Stock Repurchases (Details) - USD ($) $ in Billions | Sep. 30, 2022 | Mar. 31, 2021 |
Stockholders' Equity Note [Abstract] | ||
Common stock authorized to be repurchased | $ 5 | |
Remaining authorized repurchase amount | $ 4.4 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Provision for income taxes | $ 223,605 | $ 211,888 | $ 787,953 | $ 780,451 |
Effective tax rate | 14% | 13% | 15% | 15% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||||
Tax benefit from share based compensation | $ 14 | $ 57 | $ 57 | $ 123 | |
Unrecognized tax benefits | 230 | 230 | $ 203 | ||
Reduction in provision for income taxes due to impact of effective tax rate | $ 152 | $ 152 |
Segment and Geographic Inform_3
Segment and Geographic Information - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) segment | Sep. 30, 2021 USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of operating segments | segment | 1 | |||
Revenues | $ 7,925,589 | $ 7,483,467 | $ 23,763,497 | $ 21,988,526 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | $ 3,300,000 | $ 3,000,000 | $ 9,700,000 | $ 9,000,000 |
Segment and Geographic Inform_4
Segment and Geographic Information - Long-lived Assets by Geographical Areas (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived tangible assets | $ 2,785,303 | $ 2,833,059 |
International | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived tangible assets | $ 798,958 | $ 936,967 |