Netflix Analysis

Historical Financial Analysis Time Series Analysis (Detailed in Exhibits 9-11) Overall, the historical financial statements of Netflix are characteristic of a go with entering its emersion stage. Revenues have grown at a rapid pace over the past five years, increase from $996 million in FY 2006 to $1.6 billion in FY 2009. Assets have change magnitude slightly over the same time period, to $663 million. Netflix is currently maturation at a more rapid pace than it has in the conjunctions history, which dates back to 1997. Netflix appears like a company that has figured come forth its care model and is looking to figure of speech upon that model. When analyzing Netflixs income statement, the most obvious factor standing out is that the companys earnings have increased quickly over the past five years, more than doubling from FY 2005 to FY 2009. ofttimes of this growth can be attributed to increasing revenues. Earnings growth can also be attributed to improving moldings as the redundant revenues come without additions to its fixed assets. In FY 2009, its EBIT fate was 11.89% and the net margin was 6.94%. Each of these margins has increased by a couple of percentage points in comparison with prior years. Important items to look at in the internet retailing industry are revenues, tax income margin, and operating expenses.

Material costs in Netflixs business are its cost of goods exchange, depreciation, and SG&A expenses. Cost of goods sold represents about half of the companys total revenue. It is noted that this expense increased by 2 percentage points sexual congress to Netflixs revenues. This increase may be due to a shift in its business strategy to emphasize its digital streaming offerings to consumers. Depreciation represents about 15% of total revenues. at that place was a spike of a couple of percentage points in 2007 and 2008, but it has declined again in 2009. We will look into this track further when we examine the cash flow statement. SG&A is the second largest expense... If you want to get a full essay, do it on our website: Orderessay

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