Netflix Inc (NFLX) SEC Filing 10-K Annual report for the fiscal year ending Wednesday, December 31, 2014

Exhibit 99.1

January 20th, 2015

Fellow Shareholders,

In 2014, we added a record 13.0 million new members, compared to 11.1 million in 2013, bringing our global total to 57.4 million members. In Q4, we added 4.33 million members vs 4.07 million in the previous year period. We expect to end Q1 2015 with 61.4 million global members. Internet TV is growing globally and Netflix is leading the charge.



(in millions except per share data and Streaming Content Obligations)	Q4 '13			Q1 '14			Q2 '14			Q3 '14			Q4 '14			Q1 '15 Forecast
Total Streaming:
Revenue	$	962		$	1,066		$	1,146		$	1,223		$	1,305		$	1,398
Contribution Profit	$	117		$	166		$	212		$	220		$	178		$	231
Contribution Margin	12.2		%	15.6		%	18.5		%	18.0		%	13.6		%	16.5		%
Paid Members	41.43			46.14			47.99			50.65			54.48			58.97
Total Members	44.35			48.35			50.05			53.06			57.39			61.44
Net Additions	4.07			4.00			1.69			3.02			4.33			4.05

US Streaming:
Revenue	$	741		$	799		$	838		$	877		$	917		$	973
Contribution Profit	$	174		$	201		$	227		$	251		$	257		$	293
Contribution Margin	23.4		%	25.2		%	27.1		%	28.6		%	28.0		%	30.1		%
Paid Members	31.71			34.38			35.09			36.27			37.70			39.79
Total Members	33.42			35.67			36.24			37.22			39.11			40.91
Net Additions	2.33			2.25			0.57			0.98			1.90			1.80

International Streaming:
Revenue	$	221		$	267		$	307		$	346		$	388		$	425
Contribution Profit (Loss)	$	(57	)	$	(35	)	$	(15	)	$	(31	)	$	(79	)	$	(62	)
Contribution Margin	-25.9		%	-13.1		%	-5.0		%	-8.9		%	-20.3		%	-14.6		%
Paid Members	9.72			11.76			12.91			14.39			16.78			19.18
Total Members	10.93			12.68			13.80			15.84			18.28			20.53
Net Additions	1.74			1.75			1.12			2.04			2.43			2.25

Total (including DVD):
Operating Income	$	82		$	98		$	130		$	110		$	65		$	79
Net Income*	$	48		$	53		$	71		$	59		$	83		$	37
EPS*	$	0.79		$	0.86		$	1.15		$	0.96		$	1.35		$	0.60

Free Cash Flow	$	5		$	8		$	16		$	(74	)	$	(78	)
Shares (FD)	61.3			61.5			61.6			61.8			61.8
Streaming Content Obligations** ($B)	$	7.3		$	7.1		$	7.7		$	8.9		$	9.5
*Q4'14 Net Income/EPS includes a $39m / $0.63 benefit from a tax accrual release related to resolution of tax audit
**Corresponds to our total known streaming content obligations as defined in our financial statements and related notes in our most recently filed SEC Form 10-K



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The following information was filed by Netflix Inc (NFLX) on Tuesday, January 20, 2015 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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