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Neither Netflix nor Disney is a clear winner for every investor. Netflix’s latest cited results show faster revenue growth and a higher company-wide operating margin; Disney combines streaming with Sports and Experiences, and its Entertainment streaming business was profitable in its latest reported quarter. Disney also had the lower forward P/E in a dated October 2, 2026 snapshot. Those facts describe different businesses and do not predict which stock will deliver better returns.
What the latest results say
The most recent periods in the available filings are not aligned: Netflix’s annual figures are for the year ended December 31, 2025, its latest cited quarter ended June 30, 2026, and Disney’s latest cited quarter ended June 27, 2026. Treat the comparison as a snapshot of each company’s reported performance, not a same-period, streaming-only contest.
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| Measure | Netflix | Disney |
|---|---|---|
| Latest revenue growth cited | 2025 revenue was $45.183 billion, up 16% from $39.001 billion in 2024; Netflix’s 2025 Form 10-K attributes growth to membership, price increases and advertising, partly offset by foreign exchange. | Q3 FY2026 revenue was $25.248 billion, up 7% year over year; this is Disney’s total-company result, not streaming revenue alone. |
| Latest cited operating margin | 33.4% for Q2 2026, on $12.560 billion of revenue and $4.193 billion of operating income; the comparable margin was 34.1% a year earlier. | Entertainment SVOD operating margin was 12.9% in Q3 FY2026, on $712 million of operating income. This is a Disney-defined, non-GAAP streaming measure, not a total-company margin. |
| Cash generation | $10.149 billion of operating cash flow in 2025. First-half 2026 cash-flow growth included a $2.8 billion Warner Bros. Discovery termination fee, so that increase should not be treated as entirely recurring. | Q3 FY2026 cash provided by operations was $4.866 billion; free cash flow was $3.072 billion, a company-defined non-GAAP measure to consider alongside its comparable GAAP measures. |
| Business mix | Streaming-led entertainment business. | Entertainment, Sports and Experiences, with Q3 FY2026 revenue of $11.345 billion, $4.500 billion and $9.968 billion, respectively. |
Netflix’s Q2 2026 operating margin eased as technology and development and sales and marketing expenses grew faster than revenue. The same quarter still showed substantial operating profitability, but the year-over-year margin movement matters when assessing whether growth is translating into improved operating efficiency.
How to compare the two businesses fairly
Growth: Netflix has the stronger cited revenue pace
Netflix’s 16% annual revenue growth for calendar 2025 exceeded Disney’s 7% growth in Q3 FY2026, but these are different reporting periods and unlike business mixes. Netflix attributed its annual growth to membership growth, pricing and advertising, with foreign-exchange effects partly offsetting those gains. Disney’s total-company growth incorporates its entertainment, sports and experiences operations. The figures support a recent-growth advantage for Netflix, not a forecast that its growth will remain faster.
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Netflix stopped reporting average paying memberships and average monthly revenue per paying membership during 2025, according to its 2025 Form 10-K. Its stated emphasis is on revenue and operating margin; investors should not treat subscriber counts as a regularly disclosed current metric without a newer company disclosure.
Profitability: do not compare unlike margins
Netflix’s 33.4% Q2 2026 operating margin covers the company as a whole. Disney’s 12.9% figure covers Entertainment SVOD, not Disney overall. Disney defines that SVOD measure to include Disney+, Hulu and Disney+ Hotstar through November 14, 2024, and to exclude Hulu Live TV and Fubo virtual multichannel services. Disney cautions that its non-GAAP measures may not be comparable with similarly titled measures at other companies.
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For context on Disney beyond streaming, its Q3 FY2026 total segment operating income was $5.555 billion: Entertainment contributed $1.680 billion, Sports $858 million and Experiences $3.017 billion. Disney labels total segment operating income as non-GAAP. These segment figures reflect businesses with different economics; they are not directly comparable to Netflix’s company-wide operating income.
Cash flow: separate ordinary performance from one-off effects
Netflix reported $10.149 billion in operating cash flow for 2025. Its 2025 Form 10-K also disclosed $24.039 billion in content obligations for content acquisition, licensing and production. Those commitments are part of the economics of a content-intensive business, but they are not identical to debt; the filing lists debt and lease obligations separately.
Rank #3
For the first half of 2026, Netflix said a $2.8 billion termination fee following the end of its Warner Bros. Discovery transaction was a major driver of the year-over-year increase in net income and operating cash flow. It also reported higher payments for content assets. The fee is transaction-related, not ordinary recurring operating cash generation.
Disney reported $4.866 billion of cash provided by operations and $3.072 billion of free cash flow in Q3 FY2026. Disney identifies free cash flow as non-GAAP and advises considering it alongside comparable GAAP measures. The companies’ cash-flow figures cover different periods, and Disney’s quarterly free-cash-flow figure should not be treated as directly equivalent to Netflix’s full-year operating cash flow.
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What the valuation snapshot does—and does not—show
At the October 2, 2026 market close, Stock Analysis listed these prices and forward price-to-earnings ratios:
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1Fix the driver behind crashes, sound loss and screen glitches2Repair Windows errors before they cause bigger problems3Scan for outdated or missing drivers - takes under a minute| Stock | Share price at October 2, 2026 close | Forward P/E at that snapshot | Market capitalization at that snapshot |
|---|---|---|---|
| Netflix (NFLX) | $67.06 | 19.35 | $279.23 billion |
| Disney (DIS) | $102.19 | 13.55 | $176.45 billion |
On that dated third-party snapshot, Disney’s forward P/E was lower. Forward P/E divides a share price by estimated future earnings, so it changes with both market prices and earnings forecasts. A lower multiple alone does not establish that a stock is undervalued: the estimates may prove inaccurate, and the market may be pricing different growth, margins, risks or capital needs into each company.
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The share prices and market capitalizations are also date-specific, not durable comparisons. They are not a substitute for checking current market data and the assumptions behind analyst earnings estimates before making an investment decision.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Risks and execution to weigh
- Content spending and commitments: Netflix’s disclosed content obligations underscore the need to keep producing, licensing or acquiring entertainment that attracts and retains audiences. Spending commitments are not the same as debt, but they represent meaningful future business obligations.
- Pricing, advertising and audience growth: Netflix’s recent growth reflects several drivers, including pricing and advertising as well as membership growth. Sustaining results depends on execution across those drivers; the company’s discontinued membership disclosures also mean fewer regularly reported subscriber metrics are available for tracking.
- Margin pressure: Netflix’s Q2 2026 margin was below the year-earlier level as specified operating expenses grew faster than revenue. Continued investment may support the business, but its returns are not guaranteed.
- Foreign exchange: Netflix identified currency effects as a partial offset to 2025 revenue growth, showing that reported results can move for reasons beyond underlying demand.
- Disney’s varied businesses: Disney’s results depend on Entertainment, Sports and Experiences, each with distinct operating exposures. In Q3 FY2026, Sports segment operating income declined year over year, even as the company reported results across all three segments.
- Forecast and valuation risk: The forward P/E comparison depends on third-party earnings estimates. Actual earnings and share prices can diverge from those assumptions.
Which stock may fit which investment thesis?
Netflix may better match an investor seeking exposure to a streaming-led entertainment company and willing to underwrite continued growth in revenue, advertising and profitability. The evidence supports stronger recent revenue growth than Disney’s cited total-company growth, but not certainty about future performance.
Disney may better match an investor seeking a diversified entertainment company whose operations include streaming, sports and experiences, and who sees value in its lower forward P/E snapshot. Its streaming operation reported positive operating income, but the valuation remains dependent on estimates and the broader business has risks beyond streaming.
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Before choosing, compare each stock with your time horizon, tolerance for volatility, portfolio concentration and expectations for future earnings. Neither the operating figures nor the dated valuation snapshot determines which investment is suitable for a particular person.
Quick Recap
Sources and definitions
- Netflix, 2025 Form 10-K, for annual revenue, operating cash flow, growth drivers, membership-disclosure changes and content obligations.
- Netflix, Q2 2026 Form 10-Q, for quarterly revenue, operating income, margin and the first-half cash-flow discussion of the termination fee and content payments.
- The Walt Disney Company, Q3 FY2026 earnings release and segment materials, for total-company results, segment figures, SVOD results and non-GAAP definitions.
- Stock Analysis, NFLX and DIS quote pages, for the October 2, 2026 closing-price, forward P/E and market-capitalization snapshot.
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