Netflix Inc. (NASDAQ:NFLX)

The financial data reveals a generally positive performance trend over the five-year period. Key profitability metrics exhibit growth, indicating improved earnings capacity and operational efficiency.

Net Income

Net income demonstrates an overall upward trajectory. From 2020 to 2021, it nearly doubled, rising from approximately 2.76 billion to 5.12 billion US dollars. After a slight decrease in 2022 to around 4.49 billion, net income rebounded in 2023 and further accelerated in 2024, reaching approximately 8.71 billion, the highest value in the series. This trend suggests recovery and strong profitability enhancements toward the end of the period.

Earnings Before Tax (EBT)

EBT follows a similar pattern to net income. It increased substantially from about 3.20 billion in 2020 to 5.84 billion in 2021. A dip in 2022 to roughly 5.26 billion was followed by increases in 2023 and 2024, peaking near 9.97 billion. The EBT growth mirrors that of net income, indicating controlled tax impact and underlying profit strength.

Earnings Before Interest and Tax (EBIT)

EBIT also rose significantly from approximately 3.97 billion in 2020 to 6.61 billion in 2021. It then declined to 5.97 billion in 2022 before climbing again in 2023 and 2024 to an all-time high of about 10.68 billion. This pattern suggests operational challenges in 2022 but overall improved earnings from core activities over the entire timeframe.

Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA)

EBITDA consistently increased every year, starting from roughly 14.89 billion in 2020 and reaching approximately 26.31 billion in 2024. This continuous upward movement highlights expanding earnings capacity before accounting for non-cash expenses and indicates strong cash flow generation potential over the five years.

In summary, all profitability indicators show robust growth with a minor temporary setback around 2022. The data suggests a strengthening earnings profile and enhanced operational performance culminating in substantial increases by the end of 2024.

The financial data reveals significant fluctuations in both the enterprise value (EV) and EBITDA figures over the observed periods. Enterprise value experienced a pronounced decline from the end of 2020 through 2022, followed by a substantial increase in the subsequent two years. Specifically, EV decreased from approximately $246.6 billion at the end of 2020 to about $170.8 billion at the end of 2022, then rose sharply to over $421.7 billion by the end of 2024.

In contrast, EBITDA demonstrated a consistent upward trend throughout the entire timeframe. Starting at roughly $14.9 billion in 2020, EBITDA increased steadily each year, reaching approximately $26.3 billion by 2024. This steady growth indicates increasing operational profitability before accounting for interest, taxes, depreciation, and amortization.

Regarding valuation multiples, the EV/EBITDA ratio declined markedly from 16.57 at the end of 2020 to 8.4 by the end of 2022, suggesting that the company's valuation relative to its earnings capacity decreased during this period. However, this ratio rebounded to 16.03 by the end of 2024, implying a renewed or elevated market valuation relative to EBITDA.

Enterprise Value (EV)

Showed an initial downtrend followed by a sharp recovery, indicating fluctuating market perceptions or changes in capital structure.

EBITDA

Consistently grew year over year, reflecting improving operational performance and earnings quality.

EV/EBITDA Ratio

Decreased significantly from 2020 to 2022, reaching a low point, then increased again by 2024, which may indicate changing market sentiment or adjustments in risk assessment.

In summary, the data suggests a phase of valuation contraction and perhaps market uncertainty between 2020 and 2022, despite rising operational earnings. From 2023 onwards, both enterprise value and valuation multiples experienced strong increases, aligning with continued growth in EBITDA. This pattern could reflect enhanced investor confidence or strategic developments. The consistent EBITDA growth underscores solid underlying financial performance throughout the period.