INCOME TAXES |
3 Months Ended |
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Mar. 31, 2026 | |
| Income Tax Disclosure [Abstract] | |
| INCOME TAXES | INCOME TAXES Income tax benefit (expense) was $214 million and $(15) million for the three months ended March 31, 2026 and 2025, respectively. The increase in income tax benefit for the three months ended March 31, 2026 compared to the same period in 2025 was primarily attributable to excess tax benefits from share-based compensation. Income tax benefit for the three months ended March 31, 2026, reflects an effective income tax rate that differs from the federal statutory tax rate primarily attributable to a book tax difference in the Netflix Termination Fee accrual (See Note 1) based on current assessments, as well as excess tax benefits from share-based compensation. As of March 31, 2026 and December 31, 2025, the Company’s reserves for unrecognized tax benefits totaled $2,368 million and $2,356 million, respectively. As of March 31, 2026 and December 31, 2025, the Company had accrued $896 million and $856 million, respectively, of total interest and penalties payable related to unrecognized tax benefits. The Company recognizes interest and penalties related to unrecognized tax benefits as a component of income tax expense. The Organization for Economic Co-operation and Development’s (“OECD”) Pillar Two Global Anti-Base Erosion (“GloBE”) model rules, issued under the OECD Inclusive Framework on Base Erosion and Profit Shifting, introduce a global minimum tax of 15% applicable to multinational enterprise groups with consolidated financial statement revenue in excess of €750 million. Numerous foreign jurisdictions have already enacted tax legislation based on the GloBE rules, with some effective as early as January 1, 2024. In January 2026, the OECD issued additional guidance on the minimum tax framework, including a “side by side” safe harbor framework that would apply to U.S.-parented groups. Even if this safe harbor applies, we would still be subject to local minimum tax regimes in countries that have adopted these rules. The interpretation and adoption of the OECD’s recommendations continue to vary across jurisdictions. As of March 31, 2026, we recognized an immaterial income tax expense for Pillar Two GloBE minimum tax. The Company is continuously monitoring the evolving application of this legislation and assessing its potential impact on our future tax liability.
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