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Netflix and Disney are not like-for-like companies. Netflix is primarily a global streaming business funded mainly by monthly memberships, with advertising and other revenue streams. Disney combines entertainment streaming with sports, film and television production, parks, cruises, consumer products and licensing. Their consolidated revenue, margins and earnings therefore describe different economic activities.
A useful stock comparison starts by separating the shared streaming businesses from each company’s total results, then aligns reporting periods, accounting definitions, cash needs, risks and valuation dates. The figures below explain how to do that without treating operating growth as proof that either stock is attractively priced.
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What each company actually owns and operates
Netflix: a streaming-led model
Netflix’s core product is on-demand video delivered over the internet. Its principal revenue source is recurring membership fees, supplemented by advertising and other revenue. The company’s economics are therefore driven by subscriber pricing and retention, viewing demand, content costs, advertising adoption, foreign exchange and the ability to spread technology and content investment across a large global audience.
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Disney: a portfolio of businesses
Disney reports a much broader portfolio. It includes entertainment studios and television operations, streaming services, sports, theme parks, resorts, cruise operations, consumer products and licensing. Streaming is important, but parks and other experiences can materially change the company’s revenue, operating income and capital requirements from one period to the next.
Disney also reports transactions and portfolio changes that can affect year-over-year comparisons. Its fiscal 2026 Form 10-Q identifies a 37% interest in the India joint venture formed with Reliance after the Star India transaction. The filing also includes Fubo and NFL-related transactions in 2026-period results. Those changes can alter reported growth independently of underlying demand in an established business.
Why consolidated totals can mislead
One Netflix revenue dollar largely reflects a digital subscription or advertising relationship. A Disney revenue dollar may come from a movie release, a sports right, a theme-park ticket, a cruise booking, a merchandise license or a streaming subscription. Those activities have different seasonality, gross margins, fixed costs, capital needs and sensitivity to the economy.
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| Comparison area | Netflix | Disney | What the difference means |
|---|---|---|---|
| Primary activities | Streaming entertainment and related monetization | Entertainment, streaming, sports, experiences, consumer products and licensing | Company-wide growth and margins are not measuring the same mix of operations. |
| Main customer revenue relationships | Recurring memberships, advertising and other streaming-related revenue | Subscriptions plus theatrical, television, sports, park, cruise, product and licensing revenue | Price, volume and demand drivers differ by segment. |
| Physical investment exposure | Content, technology and infrastructure investment | Content and technology plus parks, resorts, ships and other property investment | Disney’s portfolio generally carries more physical-asset and travel exposure. |
| Reporting emphasis in the latest filing reviewed | Revenue and operating margin; membership counts discontinued as a reported metric during 2025 | Company-wide GAAP results plus segment measures, including an Entertainment SVOD measure labeled non-GAAP | Definitions must be checked before putting figures in the same table. |
Which reported periods can be compared?
Period alignment is the first mechanical check. Netflix’s latest primary annual filing reviewed here covers the calendar year ended December 31, 2025. Disney’s latest filing reviewed here covers its fiscal third quarter and first nine months ended June 27, 2026. A full-year Netflix figure should not be compared directly with a single Disney quarter or a nine-month Disney total.
| Company and period | Revenue | Operating income or margin | Net income or EPS |
|---|---|---|---|
| Netflix, calendar 2025 | $45.183 billion | $13.327 billion operating income; 29.5% operating margin | $10.981 billion net income |
| Disney, fiscal Q3 2026, quarter ended June 27, 2026 | $25.248 billion | Segment measures require the definition used in Disney’s filing or release | $2.638 billion net income attributable to Disney; $1.51 diluted EPS |
| Disney, fiscal 2026 first nine months ended June 27, 2026 | $76.397 billion | Use the nine-month consolidated and segment figures in the filing | Use the corresponding nine-month figures, not the quarter’s results |
Netflix reported that 2025 revenue increased 16% from 2024. Its $13.327 billion of operating income represented a 29.5% operating margin for that calendar year. These are full-year company-wide figures. Disney’s $25.248 billion is a quarterly figure, while $76.397 billion covers nine months, so neither is a like-for-like denominator for Netflix’s annual results.
How to compare the streaming businesses separately
After identifying the business mix, compare the portions that are economically closest: Netflix’s streaming operations and Disney’s streaming operations. Even here, definitions differ. Netflix presents company-wide revenue and operating income for a streaming-led enterprise. Disney reports Entertainment SVOD revenue and operating income as a segment measure, and the filing labels Entertainment SVOD operating income as non-GAAP. It should not be presented as identical to consolidated GAAP operating income.
Disney’s fiscal Q3 2026 streaming indicators
Disney’s fiscal Q3 2026 earnings release reported 11% Entertainment SVOD revenue growth and a 13% Entertainment SVOD operating margin. The release said the margin also reflected the timing of marketing and programming spending. That timing qualification matters: a quarterly margin can move because costs are recognized earlier or later, even when the underlying annual economics are unchanged.
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Questions to ask about Netflix
- How much of revenue growth came from price changes, volume, advertising or foreign exchange?
- Did operating margin expand because of durable efficiency, favorable currency, lower content amortization or temporary timing?
- Are content investments producing sustained viewing and retention, or merely a short-lived release spike?
- How is the advertising tier developing without weakening the value of higher-priced plans?
Questions to ask about Disney’s streaming segment
- Is Entertainment SVOD growth organic, or affected by portfolio changes and transactions?
- How much of the 13% margin reflects recurring economics versus the timing of marketing and programming spend?
- How do streaming results interact with Disney’s broader studio, sports and licensing ecosystem?
- Does streaming improve the company’s overall return on invested capital after including content and technology costs?
The correct conclusion from these measures is limited: Disney’s reported Entertainment SVOD growth and margin describe its streaming segment for the stated quarter, while Netflix’s 2025 margin describes the entire Netflix company for a full year. They are useful clues, not interchangeable performance statistics.
How to read growth without mistaking transactions for operating momentum
Revenue growth should be decomposed rather than accepted as a single score. For each company, separate price, volume, advertising, foreign exchange, acquisitions, dispositions and timing effects where the filing provides that information.
Netflix’s 2025 growth
Netflix reported $45.183 billion of 2025 revenue, up 16% from 2024. The annual filing is the appropriate source for understanding how much came from membership pricing, advertising and other revenue, and how currency movements affected the reported result. Do not infer that a 16% increase means every geographic market or every customer cohort grew at the same rate.
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Disney’s fiscal 2026 growth context
Disney’s first nine months of fiscal 2026 produced $76.397 billion of revenue, but that number includes a different fiscal calendar and a portfolio affected by the India joint venture, Fubo and NFL-related transactions. A year-over-year comparison should identify which businesses were present in each period before attributing the change to customer demand or execution.
A practical growth bridge
- Write down the exact reporting period and prior-period comparator.
- List reported revenue by segment or source.
- Mark changes caused by price, volume, advertising and foreign exchange.
- Identify acquisitions, joint ventures, dispositions and newly included transactions.
- Check whether a release or filing describes timing effects in marketing, programming, sports or content costs.
- Only then assess underlying growth and whether it appears repeatable.
How to compare profitability and earnings quality
Operating margin is more informative than revenue alone
Netflix’s 2025 operating income was $13.327 billion on $45.183 billion of revenue, producing a 29.5% operating margin. That ratio shows how much of the full-year revenue remained after operating expenses, but it still reflects Netflix’s particular content- and technology-led cost structure.
For Disney, calculate company-wide operating margin from consolidated GAAP figures for the same period, then examine segment operating results separately. Do not substitute Entertainment SVOD’s non-GAAP operating income for Disney’s consolidated operating income. Segment margins can help explain the portfolio, but they are not a replacement for the consolidated result available to all shareholders.
Disney’s fiscal Q3 2026 net-income comparison
Disney reported $2.638 billion of net income attributable to Disney and $1.51 diluted EPS for fiscal Q3 2026, compared with $5.262 billion and $2.92 in the same quarter a year earlier. Disney explains that the comparison includes a prior-year non-cash Hulu tax benefit and a current-period impairment of its A+E investment. The headline decline therefore cannot be read as a clean measure of recurring operating deterioration.
When reviewing Disney’s quarter, reconcile net income and EPS to the filing’s explanation of tax, impairment and other unusual items. A lower reported EPS can coexist with stable or improving operating performance in a segment, just as a favorable one-time item can make a prior period look unusually strong.
Earnings-quality checklist
- Start with GAAP revenue, operating income, net income and diluted EPS.
- Read the footnotes for tax benefits, impairments, acquisition effects and investment remeasurement.
- Keep management’s adjusted or supplemental measures in a separate column.
- Ask whether the item is cash, non-cash, recurring, timing-related or transaction-related.
- Use the same definition and period when comparing the two companies.
Cash generation, content spending and capital needs
Cash flow is essential because the companies invest in different assets. Netflix’s main investment burden is content, supported by technology and distribution infrastructure. Disney funds content and streaming technology but also operates or invests in parks, resorts, cruise ships and other physical assets. Those assets require different maintenance, expansion and financing decisions.
Compare operating cash flow, capital expenditures, content spending, debt and shareholder returns only from matching periods. A cash-flow figure from Netflix’s calendar 2025 should not be paired with a Disney quarter. Likewise, a Disney capital-spending surge may reflect a park or ship project rather than a change in streaming economics.
Questions for Netflix’s cash profile
- How does operating cash flow compare with content obligations and additions to the content library?
- Are cash costs recognized immediately, amortized over expected viewing, or committed under future contracts?
- Does margin expansion translate into cash after content payments and working-capital movements?
- How much flexibility remains if advertising or foreign-exchange conditions weaken?
Questions for Disney’s cash profile
- How much cash is generated by experiences versus entertainment and streaming?
- What portion is reinvested in parks, resorts, ships, sports rights and content?
- Are transaction-related cash flows obscuring the recurring cash generation of established segments?
- How do debt service and portfolio investments affect capital allocation?
Risk factors that are different, not interchangeable
| Risk category | Netflix exposure | Disney exposure |
|---|---|---|
| Content demand and cost | Success of original and licensed programming, release timing and content commitments | Film and television performance plus streaming programming and sports content costs |
| Advertising | Ad-tier adoption, pricing and advertiser demand | Advertising across television, streaming, sports and other media properties |
| Foreign exchange | Global subscription revenue and costs translated into reporting currency | International entertainment, streaming, parks and joint-venture results |
| Consumer spending and travel | Household willingness to retain a subscription | Ticketing, merchandise, resort, cruise and park demand can be sensitive to economic conditions |
| Sports rights | Less central to the model than at Disney | Rights costs, audience ratings and advertising economics can materially affect results |
| Portfolio changes | Primarily changes in monetization and content strategy | Joint ventures, acquisitions, investments and transactions can change reported comparability |
The risk list should be connected to the segment that creates it. For example, a strong streaming quarter does not eliminate Disney’s parks or sports exposure, and a strong Netflix operating margin does not remove its dependence on content demand and subscription economics.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How valuation should be done
A stronger business is not automatically a cheaper stock. Valuation requires market capitalization or share price data from the same date for both companies and consistently defined earnings or cash-flow measures. This comparison does not establish current relative multiples or a target price.
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- Choose one market-data date and record each closing share price.
- Use the same share-count convention, such as basic or diluted shares, for both companies.
- Define enterprise value consistently if debt and cash are included.
- Match the valuation numerator to the same trailing or forward period.
- Separate GAAP earnings from adjusted measures and explain every adjustment.
- Test sensitivity to currency, one-time items, segment mix and changes in estimates.
Useful valuation lenses
- Price-to-earnings: useful only when earnings definitions and unusual items are comparable.
- Enterprise value to operating income or EBITDA: can help compare capital structures, but EBITDA does not capture all content, property or capital needs.
- Free-cash-flow yield: informative when content payments, capital expenditures and working-capital definitions are consistent.
- Sum-of-the-parts analysis: potentially useful for Disney because streaming, sports, entertainment and experiences have different economics, but it depends heavily on assumptions.
Do not turn a higher growth rate or margin into an automatic valuation conclusion. The market may already price in that performance, while a slower-growing business may be valued on cash generation, assets or portfolio optionality.
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What historical stock performance can and cannot tell you
Past share-price performance is context, not a forecast. Netflix’s 2025 Form 10-K states: “Historical stock price performance should not be relied upon as an indication of future stock price performance.” The same principle applies to Disney. A chart can show what investors previously paid and how sentiment changed; it cannot establish what either stock will return next.
If you review historical returns, identify the start and end dates, include dividends where appropriate, and distinguish nominal price change from total return. Then connect the result to changes in earnings, interest rates, market expectations and business mix rather than treating the chart as evidence of future performance.
Dividend policy and shareholder returns
Netflix’s filing says: “We have never declared or paid any cash dividends on our capital stock, and we do not currently anticipate paying any cash dividends in the foreseeable future.” Investors evaluating Netflix therefore focus on reinvestment, balance-sheet decisions and potential capital returns other than a regular cash dividend.
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A repeatable decision framework for comparing the stocks
- Map the businesses. Write down which revenue streams belong to streaming, sports, experiences, products and licensing.
- Align the periods. Put Netflix calendar 2025 beside a comparable Disney annual period, or compare matching quarters. Label every figure.
- Separate GAAP and non-GAAP. Keep Disney’s Entertainment SVOD measure distinct from consolidated operating income.
- Normalize unusual items. Identify Disney’s Hulu tax benefit and A+E impairment effects before interpreting EPS changes.
- Analyze growth drivers. Break revenue into price, volume, advertising, foreign exchange and portfolio changes.
- Assess margins and cash. Review operating margin, operating cash flow, content obligations, capital expenditure and debt together.
- Stress-test risks. Model weaker consumer spending, higher content costs, adverse currency movements and softer advertising.
- Value both stocks on one date. Use the same earnings or cash-flow definitions and avoid unsupported multiples.
- Make an investment judgment only after the evidence is aligned. Business quality, operating momentum and valuation are separate questions.
Bottom line
Netflix is the cleaner streaming comparison, with 2025 revenue of $45.183 billion, operating income of $13.327 billion and a 29.5% operating margin for the full calendar year. Disney is a diversified entertainment and experiences company whose fiscal Q3 2026 revenue was $25.248 billion for one quarter and $76.397 billion for the first nine months. Those figures cannot be ranked without adjusting for period length, business mix and accounting definitions.
The most defensible comparison is therefore a framework, not a one-line winner: compare streaming with streaming, portfolio results with portfolio results, reconcile unusual items, examine cash and capital needs, and calculate valuation from same-date market data. Neither operating growth nor historical share performance alone establishes whether either stock is attractively valued.
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