Netflix isn't going to stop churning out original content anytime soon. This week, the streaming giant announced it's planning to raise an additional $1 billion in funding through a new debt offering that the company would use for content production, acquisitions, and other general purposes. By now, debt offerings have been routine for the streamer — just last October, Netflix raised an additional $2 billion by selling unsecured bonds. As of the company's quarterly earnings call this past Wednesday, it listed $14.2 billion in long-term debt.
"Netflix intends to use the net proceeds from this offering for general corporate purposes, which may include content acquisitions, production and development, capital expenditures, investments, working capital, and potential acquisitions and strategic transactions," the company said in a statement.
As a result of the ongoing coronavirus pandemic, quarantined and self-isolation has given Netflix — and most other OTT services, for that matter — a breath of fresh air. Per the same earnings statement, Netflix said it has enough liquidity to last the next 12 months, adding "Our financing strategy remains unchanged — our current plan is to continue to use debt to finance our investment needs."
The top streamer in the land also announced raises for most executives across the board, bumping chief executive Reed Hastings from $36.08 million in 2018 to $38.58M this year. Netflix content boss Ted Sarandos saw a similar increase, bumping his 2019 earnings up to $34.67M.
Netflix ended up adding a record-high 15.7 million subscribers in the first quarter of the year — again, largely attributable to those stuck indoors during the ongoing confinement periods. "Our membership growth has temporarily accelerated due to home confinement," Netflix stated in the letter. "Some cash spending on content will be delayed, improving our free cash flow, and some titles will be delayed, typically by a quarter."0comments
Netflix's record quarter is even after Disney+ officially entered the market last November, another service that happens to be growing at an unexpected rate. Both streamers will receive their biggest challenges yet in the coming months as both Peacock (NBCUniversal) and HBO Max (WarnerMedia) roll out their respective platforms.
What's been your favorite thing to binge on Netflix as of late? Let us know your must-watch movies and shows in the comments section!
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