Information On Reportable Segments And Reconciliation To Consolidated Net Income |
The following tables represent segment information for the quarter ended June 30, 2014: | | | | | | | | | | | | | | | | | | As of/ Three months ended June 30, 2014 | | Domestic Streaming | | International Streaming | | Domestic DVD | | Consolidated | | (in thousands) | Total members at end of period (1) | 36,244 |
| | 13,801 |
| | 6,261 |
| | — |
| Revenues | $ | 838,225 |
| | $ | 307,461 |
| | $ | 194,721 |
| | $ | 1,340,407 |
| Cost of revenues | 546,223 |
| | 266,697 |
| | 101,928 |
| | 914,848 |
| Marketing | 64,727 |
| | 56,036 |
| | — |
| | 120,763 |
| Contribution profit (loss) | $ | 227,275 |
| | $ | (15,272 | ) | | $ | 92,793 |
| | $ | 304,796 |
| Other operating expenses | | | | | | | 175,196 |
| Operating income | | | | | | | 129,600 |
| Other income (expense) | | | | | | | (12,228 | ) | Provision for income taxes | | | | | | | 46,354 |
| Net income | | | | | | | $ | 71,018 |
|
| | | | | | | | | | | | | | | | | | As of/ Six months ended June 30, 2014 | | Domestic Streaming | | International Streaming | | Domestic DVD | | Consolidated | | (in thousands) | Total members at end of period (1) | 36,244 |
| | 13,801 |
| | 6,261 |
| | — |
| Revenues | $ | 1,636,842 |
| | $ | 574,579 |
| | $ | 399,075 |
| | $ | 2,610,496 |
| Cost of revenues | 1,063,317 |
| | 511,964 |
| | 208,753 |
| | 1,784,034 |
| Marketing | 144,985 |
| | 112,876 |
| | — |
| | 257,861 |
| Contribution profit (loss) | $ | 428,540 |
| | $ | (50,261 | ) | | $ | 190,322 |
| | $ | 568,601 |
| Other operating expenses | | | | | | | 341,406 |
| Operating income | | | | | | | 227,195 |
| Other income (expense) | | | | | | | (20,879 | ) | Provision for income taxes | | | | | | | 82,183 |
| Net income | | | | | | | $ | 124,133 |
|
The following tables represent segment information for the quarter ended June 30, 2013: | | | | | | | | | | | | | | | | | | As of/ Three months ended June 30, 2013 | | Domestic Streaming | | International Streaming | | Domestic DVD | | Consolidated | | (in thousands) | Total members at end of period (1) | 29,807 |
| | 7,747 |
| | 7,508 |
| | — |
| Revenues | $ | 671,089 |
| | $ | 165,902 |
| | $ | 232,381 |
| | $ | 1,069,372 |
| Cost of revenues | 452,598 |
| | 184,400 |
| | 123,676 |
| | 760,674 |
| Marketing | 67,177 |
| | 47,335 |
| | 99 |
| | 114,611 |
| Contribution profit (loss) | $ | 151,314 |
| | $ | (65,833 | ) | | $ | 108,606 |
| | $ | 194,087 |
| Other operating expenses | | | | | | | 136,970 |
| Operating income | | | | | | | 57,117 |
| Other income (expense) | | | | | | | (10,468 | ) | Provision for income taxes | | | | | | | 17,178 |
| Net income | | | | | | | $ | 29,471 |
|
| | | | | | | | | | | | | | | | | | As of/ Six months ended June 30, 2013 | | Domestic Streaming | | International Streaming | | Domestic DVD | | Consolidated | | (in thousands) | Total members at end of period (1) | 29,807 |
| | 7,747 |
| | 7,508 |
| | — |
| Revenues | $ | 1,309,738 |
| | $ | 307,921 |
| | $ | 475,674 |
| | $ | 2,093,333 |
| Cost of revenues | 892,932 |
| | 351,292 |
| | 253,402 |
| | 1,497,626 |
| Marketing | 134,142 |
| | 99,382 |
| | 173 |
| | 233,697 |
| Contribution profit (loss) | $ | 282,664 |
| | $ | (142,753 | ) | | $ | 222,099 |
| | $ | 362,010 |
| Other operating expenses | | | | | | | 273,071 |
| Operating income | | | | | | | 88,939 |
| Other income (expense) | | | | | | | (41,360 | ) | Provision for income taxes | | | | | | | 15,419 |
| Net income | | | | | | | $ | 32,160 |
|
The following table represents the amortization of the content library: | | | | | | | | | | | | | | | | | | Domestic Streaming | | International Streaming | | Domestic DVD | | Consolidated | Three months ended June 30, | (in thousands) | 2014 | $ | 409,896 |
| | $ | 229,141 |
| | $ | 16,923 |
| | $ | 655,960 |
| 2013 | 344,441 |
| | 165,809 |
| | 17,709 |
| | 527,959 |
| Six months ended June 30, | | | | | | | | 2014 | 796,211 |
| | 443,561 |
| | 33,044 |
| | 1,272,816 |
| 2013 | 680,189 |
| | 315,801 |
| | 35,946 |
| | 1,031,936 |
|
The following table represents total content library, net: | | | | | | | | | | | | | | | | | | Domestic Streaming | | International Streaming | | Domestic DVD | | Consolidated | | (in thousands) | As of June 30, 2014 | $ | 3,196,275 |
| | $ | 914,239 |
| | $ | 24,623 |
| | $ | 4,135,137 |
| As of December 31, 2013 | 2,973,023 |
| | 804,690 |
| | 19,779 |
| | 3,797,492 |
|
| | (1) | A membership (also referred to as a subscription) is defined as the right to receive either the Netflix streaming service or Netflix DVD service. Memberships are assigned to territories based on the geographic location used at time of sign up as determined by the Company's internal systems, which utilize industry standard geo-location technology. The Company offers free-trial memberships to new and certain rejoining members. For inclusion in the definition of a member in the above metrics, a method of payment is required to be provided even during the free-trial period. Total members therefore include those who are on a free-trial and have provided a method of payment. A membership would be canceled and cease to be reflected in the above metrics as of the effective cancellation date. Voluntary cancellations become effective at the end of the monthly membership period, while involuntary cancellation of the service, as a result of a failed method of payment, becomes effective immediately. |
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