NetFlix 2013 Annual Report Download - page 73

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The following table represents the Company’s segment information for the fourth quarter of 2011:
As of/Three Months ended December 31, 2011
Domestic
Streaming
International
Streaming
Domestic
DVD Consolidated
(in thousands)
Total members at end of period (1) .......... 21,671 1,858 11,165 —
Revenues .............................. $476,334 $ 28,988 $370,253 $875,575
Cost of revenues ........................ 345,026 55,909 174,220 575,155
Marketing ............................. 73,335 32,822 1,490 107,647
Contribution profit (loss) .............. $ 57,973 $(59,743) $194,543 $192,773
Other operating expenses ................. 130,901
Operating income ................... 61,872
Other income (expense) .................. (5,037)
Provision for income taxes ................ 21,616
Net income ........................ $ 35,219
The following table represents the Company’s segment information for the year ended December 31, 2011
based on the Company’s segment reporting prior to the fourth quarter of 2011:
As of /Year ended December 31, 2011
Domestic International Consolidated
(in thousands)
Total unique members at end of period (1) (2) .......... 24,395 1,858 26,253
Revenues ....................................... $3,121,727 $ 82,850 $3,204,577
Cost of revenues ................................. 1,932,419 107,482 2,039,901
Marketing ...................................... 302,752 78,517 381,269
Contribution profit (loss) ...................... $ 886,556 $(103,149) $ 783,407
Other operating expenses .......................... 407,339
Operating income ............................ 376,068
Other income (expense) ........................... (16,546)
Provision for income taxes ......................... 133,396
Net income ................................. $ 226,126
(1) A membership (also referred to as a subscription) is defined as the right to receive either the Netflix
streaming service or Netflix DVD service. Memberships are assigned to territories based on the geographic
location used at time of sign up as determined by our internal systems, which utilize industry standard geo-
location technology. The Company offers free-trial memberships to new and certain rejoining members. For
inclusion in the definition of a member in the above metrics, a method of payment is required to be provided
even during the free-trial period. Total members therefore include those who are on a free-trial and have
provided a method of payment. A membership would be canceled and cease to be reflected in the above
metrics as of the effective cancellation date. Voluntary cancellations become effective at the end of the
monthly membership period, while involuntary cancellation of the service, as a result of a failed method of
payment, becomes effective immediately.
(2) For purposes of determining the number of unique members, domestic members who have elected both a
DVD and a streaming membership plan are considered a single unique member.
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