NFLX 10-Q filed 2026-10-21 | Key takeaways
NFLX filed its 10-Q; the most relevant disclosure change is added Debt — new 5.250% senior notes tranche: As of September 30, 2026, the Company has aggregate outstanding notes of $15,132 million across 13 tranches, including a newly added $1,000 million 5.250% senior notes tranche issued in July 2026 and maturing August 2036. Aggregate notes increased from $14,309.
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Disclosure changes
- Debt — new 5.250% senior notes tranche
As of September 30, 2026, the Company has aggregate outstanding notes of $15,132 million across 13 tranches, including a newly added $1,000 million 5.250% senior notes tranche issued in July 2026 and maturing August 2036. Aggregate notes increased from $14,309 million at June 30, 2026 and $14,463 million at December 31, 2025.
New tranche adds ~$1 billion of fixed-rate debt and a new maturity (2036) to the capital structure, increasing gross debt to $15.3 billion at par. - Debt — interest rate hedging expansion
Interest rate swap notional expanded to $2,400 million as of September 30, 2026 (from $1,400 million at June 30, 2026), now hedging 4.900%, 5.250%, and 5.400% senior notes as fair value hedges. Cumulative fair value hedging adjustments of $(145) million included in hedged Senior Notes carrying amount. A 1% SOFR increase would increase annual interest expense by ~$24 million.
Expands interest rate exposure by ~$1 billion and changes the sensitivity of interest expense to benchmark rate movements; net periodic settlements and fair value movements flow through interest expense. - Cash flow hedge AOCI recovery
Accumulated other comprehensive loss improved from $(580) million at December 31, 2025 to $(9) million at September 30, 2026, driven by $762 million of net unrealized gains on cash flow hedges and $63 million of net investment hedge gains, partially offset by $68 million of foreign currency translation losses. Pre-tax net accumulated gain on foreign currency cash flow hedges expected to be recognized in earnings within 12 months is $193 million.
Large AOCI swing indicates significant unrealized hedging gains accumulating; reclassifications will continue to flow through revenues and cost of revenues over the next 12 months. - Capital returns — share repurchases and remaining authorization
Repurchased 63,917,979 shares for $4.8 billion in Q3 2026 and 130,349,765 shares for $10.7 billion YTD; $22.3 billion remained available for repurchases as of September 30, 2026 (down from $27.1 billion at June 30, 2026). April 2026 board authorization added $25 billion to the program.
Capital return pace accelerated; ~$4.8 billion deployed in Q3 alone with $22.3 billion still available. - Property and equipment
Property and equipment, net grew to $2,560,619 thousand at September 30, 2026 from $2,004,350 thousand at December 31, 2025, with capital work-in-progress rising to $602,158 thousand from $285,010 thousand. YTD purchases of property and equipment were $693,540 thousand versus $448,885 thousand in the prior-year period.
Significant increase in capital expenditures and capital work-in-progress suggests capacity expansion or major buildout in progress. - Content assets
Content assets, net grew to $34,605,477 thousand at September 30, 2026 (up from $32,778,392 at December 31, 2025 and $33,837,573 at June 30, 2026), with produced content in production of $10,905,673 thousand versus $9,210,735 thousand at year-end. YTD amortization of content assets was $12,764,663 thousand versus $11,657,930 thousand in the prior-year period.
Continued build of content asset base ahead of amortization, particularly in produced content still in production.
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