Can Netflix Stock Hold Margin Gains as Content Spending Keeps Growing?

Netflix NFLX is testing whether its margin gains can withstand a steadily rising content bill. Third-quarter 2026 results showed operating margin expanding to 34.6% from 28.2% a year ago, even as additions to content assets climbed 10.9% year over year to $5.16 billion. Content amortization rose just 5.8% to $4.24 billion, while revenues grew 11.8% to $12.87 billion, lifting operating income 37% to $4.46 billion. Spending is not flattening, however. Nine-month additions to content assets totaled $14.93 billion, up 24%, while amortization grew 9.5%. Netflix expects an annual cash content spend-to-amortization ratio of about 1.1x and reaffirmed its 2026 operating margin target of 31.5%, up from 29.5% in 2025.