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Netflix, Inc.

Segment Information
(unaudited)
(in thousands)
Twelve Twelve
Months Months Twelve
As of / Three Months Ended Ended As of / Three Months Ended Ended As of / Three Months Ended Months Ended
March 31, June 30, September 30,December 31,December 31, March 31, June 30, September 30, December 31,December 31, March 31, June 30, September 30,December 31, December 31,
2014 2014 2014 2014 2014 2015 2015 2015 2015 2015 2016 2016 2016 2016 2016

Domestic Streaming
Total memberships at end of period 35,674 36,244 37,219 39,114 41,397 42,300 43,181 44,738 46,967 47,129 47,497 49,431
Paid memberships at end of period 34,377 35,085 36,265 37,698 40,315 41,057 42,068 43,401 45,714 46,004 46,479 47,905
Revenues $ 798,617 $ 838,225 $ 877,150 $ 917,442 $3,431,434 $ 984,532 $ 1,025,913 $ 1,063,961 $ 1,105,933 $4,180,339 $ 1,161,241 $ 1,208,271 $ 1,304,333 $ 1,403,462 $ 5,077,307
Cost of revenues 517,094 546,223 565,251 573,193 2,201,761 582,529 612,691 644,914 647,059 2,487,193 666,546 707,106 720,658 761,479 2,855,789
Marketing 80,258 64,727 61,045 87,423 293,453 89,551 73,427 74,835 79,833 317,646 81,942 86,806 108,495 105,589 382,832
Contribution profit 201,265 227,275 250,854 256,826 936,220 312,452 339,795 344,212 379,041 1,375,500 412,753 414,359 475,180 536,394 1,838,686
Contribution margin 25.2% 27.1% 28.6% 28.0% 27.3% 31.7% 33.1% 32.4% 34.3% 32.9% 35.5% 34.3% 36.4% 38.2% 36.2%

International Streaming
Total memberships at end of period 12,683 13,801 15,843 18,277 20,877 23,251 25,987 30,024 34,533 36,048 39,246 44,365
Paid memberships at end of period 11,755 12,907 14,389 16,778 19,304 21,649 23,951 27,438 31,993 33,892 36,799 41,185

Revenues $ 267,118 $ 307,461 $ 345,685 $ 387,797 $1,308,061 $ 415,397 $ 454,763 $ 516,870 $ 566,405 $1,953,435 $ 651,748 $ 758,201 $ 853,480 $ 947,666 $ 3,211,095
Cost of revenues 245,267 266,697 291,942 350,211 1,154,117 375,278 422,966 451,251 530,880 1,780,375 629,899 698,162 748,515 834,794 2,911,370
Marketing 56,840 56,036 84,609 116,248 313,733 105,126 123,713 133,267 144,340 506,446 126,068 129,223 173,548 179,407 608,246
Contribution profit (loss) (34,989) (15,272) (30,866) (78,662) (159,789) (65,007) (91,916) (67,648) (108,815) (333,386) (104,219) (69,184) (68,583) (66,535) (308,521)
Contribution margin -13.1% -5.0% -8.9% -20.3% -12.2% -15.6% -20.2% -13.1% -19.2% -17.1% -16.0% -9.1% -8.0% -7.0% -9.6%

Total Streaming
Total memberships at end of period 48,357 50,045 53,062 57,391 62,274 65,551 69,168 74,762 81,500 83,177 86,743 93,796
Paid memberships at end of period 46,132 47,992 50,654 54,476 59,619 62,706 66,019 70,839 77,707 79,896 83,278 89,090
Revenue $ 1,065,735 $ 1,145,686 $ 1,222,835 $ 1,305,239 $4,739,495 $ 1,399,929 $ 1,480,676 $ 1,580,831 $ 1,672,338 $6,133,774 $ 1,812,989 $ 1,966,472 $ 2,157,813 $ 2,351,128 $ 8,288,402
Cost of revenues 762,361 812,920 857,193 923,404 3,355,878 957,807 1,035,657 1,096,165 1,177,939 4,267,568 1,296,445 1,405,268 1,469,173 1,596,273 5,767,159
Marketing 137,098 120,763 145,654 203,671 607,186 194,677 197,140 208,102 224,173 824,092 208,010 216,029 282,043 284,996 991,078
Contribution profit (loss) 166,276 212,003 219,988 178,164 776,431 247,445 247,879 276,564 270,226 1,042,114 308,534 345,175 406,597 469,859 1,530,165
Contribution margin 15.6% 18.5% 18.0% 13.6% 16.4% 17.7% 16.7% 17.5% 16.2% 17.0% 17.0% 17.6% 18.8% 20.0% 18.5%

Domestic DVD
Total memberships at end of period 6,652 6,261 5,986 5,767 5,564 5,314 5,060 4,904 4,741 4,530 4,273 4,114
Paid memberships at end of period 6,509 6,167 5,899 5,668 5,470 5,219 4,971 4,787 4,647 4,435 4,194 4,029
Revenues $ 204,354 $ 194,721 $ 186,597 $ 179,489 $ 765,161 $ 173,200 $ 164,018 $ 157,524 $ 150,995 $ 645,737 $ 144,747 $ 138,732 $ 132,375 $ 126,413 $ 542,267
Cost of revenues 106,825 101,928 97,201 90,928 396,882 88,594 86,095 77,793 71,426 323,908 73,095 67,830 63,671 58,146 262,742
Contribution profit 97,529 92,793 89,396 88,561 368,279 84,606 77,923 79,731 79,569 321,829 71,652 70,902 68,704 68,267 279,525
Contribution margin 47.7% 47.7% 47.9% 49.3% 48.1% 48.8% 47.5% 50.6% 52.7% 49.8% 49.5% 51.1% 51.9% 54.0% 51.5%

Consolidated
Revenues $ 1,270,089 $ 1,340,407 $ 1,409,432 $ 1,484,728 $5,504,656 $ 1,573,129 $ 1,644,694 $ 1,738,355 $ 1,823,333 $6,779,511 $ 1,957,736 $ 2,105,204 $ 2,290,188 $ 2,477,541 $ 8,830,669
Cost of revenues 869,186 914,848 954,394 1,014,332 3,752,760 1,046,401 1,121,752 1,173,958 1,249,365 4,591,476 1,369,540 1,473,098 1,532,844 1,654,419 6,029,901
Marketing 137,098 120,763 145,654 203,671 607,186 194,677 197,140 208,102 224,173 824,092 208,010 216,029 282,043 284,996 991,078
Contribution profit $ 263,805 $ 304,796 $ 309,384 $ 266,725 $1,144,710 $ 332,051 $ 325,802 $ 356,295 $ 349,795 $1,363,943 $ 380,186 $ 416,077 $ 475,301 $ 538,126 $ 1,809,690
Other operating expenses 166,210 175,196 198,977 201,679 742,062 234,595 250,967 282,654 289,901 1,058,117 330,733 345,707 369,265 384,192 1,429,897
Operating income 97,595 129,600 110,407 65,046 402,648 97,456 74,835 73,641 59,894 305,826 49,453 70,370 106,036 153,934 379,793
Other income (expense) (8,651) (12,228) (12,870) (19,530) (53,279) (59,030) (34,345) (31,403) (39,163) (163,941) (9,574) (19,138) (26,909) (63,665) (119,286)
Provision (benefit) for income taxes 35,829 46,354 38,242 (37,855) 82,570 14,730 14,155 12,806 (22,447) 19,244 12,221 10,477 27,610 23,521 73,829
Net Income $ 53,115 $ 71,018 $ 59,295 $ 83,371 $ 266,799 $ 23,696 $ 26,335 $ 29,432 $ 43,178 $ 122,641 $ 27,658 $ 40,755 $ 51,517 $ 66,748 $ 186,678