The streaming giant's years of cash burn have clearly paid off.
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How is Netflix doing on a GAAP basis? In the first quarter, it finished with $958 million in operating income and $709 million in net income. Based on revenue of $5.8 billion, it had an operating margin of 16.6%, much better than the average company in the
S&P 500. Indeed, its subscription business model is building operating leverage as it's supposed to. Last year, it finished with a 13% operating margin, and Netflix is targeting 16% for 2020.