NFLX · 10-Q · 2026Q2 · Full report

Income Tax Rate Changes

NETFLIX INC · 2026-07-17 · Importance 58 · Surprise 56 · In source text

Second-quarter 2026 income-tax provision increased $161 million to $667 million from $506 million in the second quarter of 2025. Six-month income-tax provision increased $1.102 billion to $1.931 billion from $830 million, reflecting higher taxable income and a higher effective tax rate. The effective tax-rate increases were primarily caused by lower excess tax benefits from stock-based compensation. The six-month rate was also affected by a lower foreign-derived income deduction relative to growth in pretax income.

Key facts

• Provision for income taxes for the six months ended June 30, 2026: $1,931,467 thousand. source
• Provision for income taxes for the three months ended June 30, 2026: $667,172 thousand. source
• The increase in effective tax rates for the three and six months ended June 30, 2026 was primarily due to a decrease in tax benefits associated with lower excess tax benefits on stock-based compensation. source

Impact estimates