Netflix has 104 million subscribers worldwide. Its series and movies account for more than a third of all prime-time download Internet traffic in North America. It boasts more than 50 original shows which scored 91 total Emmy nominations this year alone.
Netflix has also accrued $20.54 billion in long-term debt and obligations "in its effort to produce more original content" according to a report in The Los Angeles Times.
The company is poised to spend at least $6 billion in content this year, and its net cash outflow this year, forecasts indicate, will grow to as much as $2.5 billion, up from $1.7 billion last year.
The company isn't expected to lower its costs, either, which has left some analysts feeling skeptical.
“Nobody is ever the dominant player forever,” says Mike Vorhaus, the president of Magid Advisors, a media and digital video consultancy. “I think they're going to need some luck in not drowning in debt in the ultimate slowdown of growth.”
The magnitude of Netflix's debt stunned social media users, too.
If Netflix stopped adding movies/shows from 1985 that nobody even knows, they wouldn't be in debt.— 🇲🇱 (@Hersolosoul) July 31, 2017
Netflix is $20 billion in debt. That's what happens when you keep producing new Adam Sandler movies.— Denizcan Targaryen (@MrFilmkritik) July 31, 2017
Netflix helped convince the majority of people that physical media was dead just in time to announce that they're $20 billion in debt.— Minovsky (@MinovskyArticle) July 31, 2017
Netflix being $20 billion in debt while still creating near endless original content is some kinda metaphor for life— Water Witch (@_artwerk) July 31, 2017
Netflix is 20 billion dollars in debt!!!??? where Chance The Actor at!!?— T E K 🌐 (@Tekhiphop) July 31, 2017
Netflix is $20 billion in debt. They scrolled through several solutions, got overwhelmed by choice & just put on Futurama for the 397th time— Nat Baimel (@NatBaimel) August 1, 2017
Netflix is almost as deep in debt as Donald Trump is to the Russians.— Randolph Duke (@CelebYouTaunt) August 1, 2017
i hear netflix is in debt.— Myq Kaplan (@myqkaplan) August 1, 2017
have they considered making it so everyone in the universe can't just share one password?
Netflix has responded to the Los Angeles Times report, and it disputes its claims.
"The LA Times story inaccurately calculates our debt, counting our streaming obligations (i.e. our content contracts with studios) of $15.7b as debt, which it isn't. The correct number: we have total gross debt of $4.8b vs. our equity market value of about $75b. They have since corrected the story," the company said in a statement.