Growth Rates
|
Most Recent Fiscal Year
|
Fiscal Year
(-1)
|
Fiscal Year
(-2)
|
Fiscal Year
(-3)
|
|
Annual Revenue Growth
|
48.18%
|
29.48
|
22.39
|
13.22
|
|
Annual Net Income Growth
|
40.58
|
38.83
|
39.55
|
24.65
|
|
Annual Free Cash Flow Growth
|
42.40
|
34.89
|
2.56
|
106.37
|
1. What trends, if any, are apparent in these ratios?
2. Netflix's revenue has consistently increased since 2008, and its net income has been positive for the last four years.
3. Hypothetically, is it possible for sales to increase while net income declines? Why or why not?
4. Yes, it is possible. If costs such as higher labor cost or increased advertising or promotional expenses exist, it is possible for net income declines while sales to increases.
5. Hypothetically, is it possible for net income to decline while free cash flow increases? Why or why not?