Analysis of Property, Plant and Equipment
Accounting Policy on Property, Plant and Equipment
Property and equipment are carried at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the shorter of the estimated useful lives of the respective assets, generally up to 30 years, or the expected lease term for leasehold improvements, if applicable.
Source: 10-K (filing date: 2020-01-29).
Property, Plant and Equipment Disclosure
Netflix Inc., balance sheet: property, plant and equipment
US$ in thousands
Based on: 10-K (filing date: 2020-01-29), 10-K (filing date: 2019-01-29), 10-K (filing date: 2018-01-29), 10-K (filing date: 2017-01-27), 10-K (filing date: 2016-01-28).
Item | Description | The company |
---|---|---|
Property and equipment, gross | Amount before accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. | Netflix Inc.’s property and equipment, gross increased from 2017 to 2018 and from 2018 to 2019. |
Property and equipment, net | Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. | Netflix Inc.’s property and equipment, net increased from 2017 to 2018 and from 2018 to 2019. |
Asset Age Ratios (Summary)
Netflix Inc., asset age ratios
Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
---|---|---|---|---|---|---|
Average age ratio | 42.66% | 47.21% | 50.19% | 54.02% | 63.16% |
Based on: 10-K (filing date: 2020-01-29), 10-K (filing date: 2019-01-29), 10-K (filing date: 2018-01-29), 10-K (filing date: 2017-01-27), 10-K (filing date: 2016-01-28).
Asset age ratio | Description | The company |
---|---|---|
Average age ratio | As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company’s fixed asset base is old or new. Newer assets are likely to be more efficient. | Netflix Inc.’s average age ratio of depreciable property, plant and equipment improved from 2017 to 2018 and from 2018 to 2019. |
Average Age
Based on: 10-K (filing date: 2020-01-29), 10-K (filing date: 2019-01-29), 10-K (filing date: 2018-01-29), 10-K (filing date: 2017-01-27), 10-K (filing date: 2016-01-28).
2019 Calculations
1 Average age = 100 × Accumulated depreciation ÷ (Property and equipment, gross – Land)
= 100 × 416,005 ÷ (981,226 – 6,125) = 42.66%
Asset age ratio | Description | The company |
---|---|---|
Average age | As long as straight-line depreciation is used, this is an accurate estimate of asset age as a percentage of depreciable life. The relative age is a useful measure of whether the company’s fixed asset base is old or new. Newer assets are likely to be more efficient. | Netflix Inc.’s average age ratio of depreciable property, plant and equipment improved from 2017 to 2018 and from 2018 to 2019. |