NetFlix 2012 Annual Report Download - page 56

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NETFLIX, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Year Ended December 31,
2012 2011 2010
Cash flows from operating activities:
Net income ................................................. $ 17,152 $ 226,126 $ 160,853
Adjustments to reconcile net income to net cash provided by operating
activities:
Additions to streaming content library ........................ (2,515,506) (2,320,732) (406,210)
Change in streaming content liabilities ....................... 762,089 1,463,955 168,231
Amortization of streaming content library ..................... 1,591,218 699,128 158,100
Amortization of DVD content library ........................ 65,396 96,744 142,496
Depreciation and amortization of property, equipment and
intangibles ............................................ 45,469 43,747 38,099
Stock-based compensation expense .......................... 73,948 61,582 27,996
Excess tax benefits from stock-based compensation ............. (4,543) (45,784) (62,214)
Other non-cash items ..................................... (8,392) (4,050) (9,128)
Deferred taxes ........................................... (30,071) (18,597) (962)
Changes in operating assets and liabilities:
Prepaid content ...................................... (3,922) 6,211 (35,476)
Other current assets .................................. (1,510) (4,775) (18,027)
Accounts payable .................................... (3,764) 23,968 19,214
Accrued expenses .................................... 9,806 65,560 65,698
Deferred revenue .................................... 20,676 21,613 27,086
Other non-current assets and liabilities ................... 4,719 3,016 645
Net cash provided by operating activities .............. 22,765 317,712 276,401
Cash flows from investing activities:
Acquisition of DVD content library .............................. (48,275) (85,154) (123,901)
Purchases of property and equipment ............................. (41,457) (49,682) (33,837)
Purchases of short-term investments ............................. (477,321) (223,750) (107,362)
Proceeds from sale of short-term investments ...................... 282,953 50,993 120,857
Proceeds from maturities of short-term investments ................. 29,365 38,105 15,818
Other assets ................................................. 8,816 3,674 12,344
Net cash used in investing activities .................. (245,919) (265,814) (116,081)
Cash flows from financing activities:
Proceeds from issuance of common stock ......................... 4,124 19,614 49,776
Proceeds from public offering of common stock, net of issuance costs . . (464) 199,947 —
Proceeds from issuance of debt, net of issuance costs ................ (295) 198,060 —
Repurchases of common stock .................................. — (199,666) (210,259)
Excess tax benefits from stock-based compensation ................. 4,543 45,784 62,214
Principal payments of lease financing obligations ................... (2,319) (2,083) (1,776)
Net cash provided by (used in) financing activities ...... 5,589 261,656 (100,045)
Effect of exchange rate changes on cash and cash equivalents ......... (197) — —
Net increase (decrease) in cash and cash equivalents ................ (217,762) 313,554 60,275
Cash and cash equivalents, beginning of year ...................... 508,053 194,499 134,224
Cash and cash equivalents, end of year ........................... $ 290,291 $ 508,053 $ 194,499
Supplemental disclosure:
Income taxes paid ............................................ $ 28,853 $ 79,069 $ 56,218
Interest paid ................................................ 19,009 19,395 20,101
See accompanying notes to consolidated financial statements.
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