NetFlix 2012 Annual Report Download - page 23

Download and view the complete annual report

Please find page 23 of the 2012 NetFlix annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 88

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88

concentration of ownership may make it more difficult for other stockholders to effect substantial changes in the
company, may have the effect of delaying, preventing or expediting, as the case may be, a change in control of
the company, and may adversely affect the market price of our common stock. In addition, involvement of
certain activist stockholders may impact our ability to recruit and retain talent or otherwise distract management.
Further, the interests of these few stockholders may not be in the best interests of all stockholders.
Our stock price is volatile.
The price at which our common stock has traded has fluctuated significantly. The price may continue to be
volatile due to a number of factors including the following, some of which are beyond our control:
• variations in our operating results;
• variations between our actual operating results and the expectations of securities analysts, investors and
the financial community;
• announcements of developments affecting our business, systems or expansion plans by us or others;
• competition, including the introduction of new competitors, their pricing strategies and services;
• market volatility in general;
• the level of demand for our stock, including the amount of short interest in our stock; and
• the operating results of our competitors.
As a result of these and other factors, investors in our common stock may not be able to resell their shares at
or above their original purchase price.
Following certain periods of volatility in the market price of our securities, we became the subject of
securities litigation. We may experience more such litigation following future periods of volatility. This type of
litigation may result in substantial costs and a diversion of management’s attention and resources.
Financial forecasting by us and financial analysts who may publish estimates of our performance may
differ materially from actual results.
Given the dynamic nature of our business, the current uncertain economic climate and the inherent
limitations in predicting the future, forecasts of our revenues, contribution margins, net income and, number of
total and paid subscriber additions and other financial and operating data may differ materially from actual
results. Such discrepancies could cause a decline in the trading price of our common stock.
Item 1B. Unresolved Staff Comments
None.
19