Netflix crosses 200 million subscribers globally

Story Highlights
  • Netflix crosses 200 million subscribers

Netflix Inc said its worldwide subscriber rolls exceeded 200 million at the end of 2020 on Tuesday and predicted that it will no longer have to borrow billions of dollars to fund its vast variety of TV shows and movies. As the financial achievement confirmed the company’s strategy of going into debt to take on major Hollywood studios with a flood of its own programming in multiple languages, Netflix shares rose almost 13 percent in extended trading.

The world’s largest subscription service has earned $15 billion in less than a decade through debt. The company said on Tuesday that it expects free cash flow to break even in 2021, adding in a letter to shareholders that we believe we no longer need to raise external capital for our day-to-day operations.

It will explore returning excess cash to shareholders through share buybacks, Netflix said. It plans to sustain a gross debt of $10 billion to $15 billion. According to eMarketer analyst Eric Haggstrom, this is in stark contrast to Disney and many other recent entrants to the streaming market who plan to lose money on streaming over the next few years.

Netflix signed up 8.5 million new paying streaming subscribers from October to December when it launched the critically acclaimed shows “The Queen’s Gambit” and “Bridgerton,” a new season of “The Crown” and “The Midnight Sky.” film by George Clooney. According to Refinitiv data, the additions topped Wall Street projections of 6.1 million, amid rising competition and a rise in US rates. Earnings per share for the fourth quarter of $1.19 exceeded analyst estimates of $1.39.

With the latest subscribers, the worldwide membership of Netflix reached 203.7 million. More subscribers were added in 2020 than in any other year by the organization that pioneered streaming in 2007, helped by audiences who stayed home to fight the coronavirus pandemic.

Today, as major media networks step up the competition, Netflix is trying to add clients across the globe. In December, Walt Disney Co announced a hefty slate of new Disney+ programming, while Warner Bros. of AT&T Inc. discarded the conventional Hollywood playbook by revealing that it would send all 2021 movies directly to HBO Max alongside theaters.

In December, Disney said it had already signed up 86.8 million Disney+ subscribers in just over a year. Netflix co-CEO Reed Hastings said in a post-earnings analyst interview that what Disney has done is super-impressive. The success of Disney, he said, gets us fired up about expanding our membership, growing our budget for content.

Last year, Netflix said much of its growth – 83 percent of new subscribers – came from outside the United States and Canada. Forty-one percent of Europe, the Middle East, and Africa have followed them. Netflix estimated that it will sign up 6 million more global subscribers for January through March, below analyst estimates of approximately 8 million.

Fourth-quarter sales grew to $6.64 billion, up from $5.47 billion a year earlier, edging previous projections of $6.63 billion. Net income dropped from $587 million, or $1.30 per share, a year ago, to $542.2 million, or $1.19 per share. In extended trading on Tuesday, Netflix shares jumped 12.5 percent to $564.32.

For more details, check out Oyprice.com.

Ronil Thakkar

Tech nerd | Elite Content writer| Gamer | Computer Engineer | Fitness Freak & Professional Blogger @oyprice.com & @bharatdetails.com

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button