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This is because Netflix account for the spending over several years even though on a cash flow basis spending exceeded income some of those years.
by laurencerowe 7y ago
This is because Netflix account for the spending over several years even though on a cash flow basis spending exceeded income some of those years.
- MegaButts 7y agoSo you're saying they might lose money some quarters...but then wouldn't they make that much more other quarters? Ultimately their bank account is growing, and it's not like their war chest is so small they can't ride out some oscillations.
- laurencerowe 7y agoNo I’m saying that they are spending more per year than they are making but the content they create with that spending has value beyond the year it was made so though they are cash flow negative they are still profitable.
- MegaButts 7y agoSo is the future value of that content reflected in the net income I linked? That explains my misunderstanding. I'd ask how they calculate that number but I guess I should just dig into the earnings reports myself.