Netflix paid $1.12 billion in U.S. federal income tax on $11 billion of net income
Netflix’s 2025 Form 10-K annual report provides, for the first time, a breakdown of cash income taxes paid by jurisdiction. The report specifies individual countries for 2025, but does not present previous years in the same detailed format.
Country-level tax picture
In 2025, Netflix paid $2.22 billion of cash income taxes, net of refunds.
The company discloses the following breakdown for 2025:
Federal: $1.12 billion
State and local: $274 million
Brazil: $275 million
Korea: $195 million
All other foreign: $356 million
The filing does not name any other specific foreign jurisdictions beyond Brazil and Korea.
Concentration and scale
Cash taxes remain concentrated in the United States. Federal and state payments total about $1.39 billion, or roughly 63% of total cash taxes paid in 2025.
Brazil accounts for about $275 million, or roughly 12% of total cash taxes. Korea accounts for about 9%. All other foreign jurisdictions together represent about 16%.
Income before income taxes was $12.7 billion in 2025. Of that, $12.2 billion was earned in the United States and $524 million abroad. The geographic pattern of pre-tax income aligns with the concentration of cash taxes in the U.S.
Year-over-year change
Total cash income taxes increased to $2.22 billion in 2025. The company paid $1.64 billion in 2024 and $1.16 billion in 2023.
The 2025 Form 10-K does not provide a country-level breakdown for 2024 or 2023. The new disaggregation reflects the adoption of ASU 2023-09, which requires jurisdiction-level disclosure of income taxes paid.
The provision for income taxes increased from $1.25 billion in 2024 to $1.74 billion in 2025. The effective tax rate rose from 13% to 14%.
Management attributes the higher effective rate primarily to lower federal research and development tax credits and income growth outpacing excess tax benefits from stock-based compensation.
What the numbers suggest
Structurally, Netflix’s cash tax footprint reflects its income distribution. The majority of pre-tax income is earned in the United States, where most cash taxes are also paid. Brazil and Korea are notable foreign contributors, but other countries are not individually specified. The new standard enhances clarity for 2025, yet foreign exposure outside these specified jurisdictions remains reported in aggregate.
The filing does not identify any legislative changes, new tax regimes, or policy shifts as drivers of the year-over-year change. The increase in the effective tax rate is tied to reduced research credit benefits and the relative growth of income. No discrete external tax law change is cited as a non-routine driver.
Closing takeaway
Netflix paid $2.22 billion in cash income taxes in 2025, of which about two-thirds were paid in the United States. The new disclosure shows clearer visibility into foreign cash taxes, led by Brazil and Korea.