Hollywood Ending? What to Expect from Netflix's Earnings Release
Netflix’s rapid global expansion
On January 11, 2016, Investor’s Business Daily reported that Netflix (NFLX) CFO (chief financial officer) David Wells brought up Bitcoin at the Citi Internet, Media & Telecommunications Conference held on January 6, 2016. According to the report, Bitcoin is “a decentralized, peer-to-peer, digital-payment network.” Wells stated that “it sure would be nice to have bitcoin in terms of a global currency that you could use globally.”
Netflix stated at the International Consumer Electronics Show in Las Vegas on January 6, 2016, that it has delivered 125 million hours of entertainment per day, is now present in 190 countries around the world, and has reached almost 70 million homes.
As the graph above indicates, and according to a Wall Street Journal report citing Digital TV Research, global revenues from SVOD (subscription video on demand) and online TV services could reach $51.1 billion in 2020.
Netflix’s international initiatives
Netflix has taken on many initiatives to increase its subscribers in international markets. These include working with consumer electronics companies Sony (SNE) and Toshiba (TOSYY) to include a Netflix button on new television sets being rolled out in countries such as Japan (EWJ).
Netflix has also made its app available through Apple’s (AAPL) iOS and Alphabet’s (GOOG) Android system. Netflix also stated at the Citi conference that as it pursues international expansion, the company is looking at both fixed-line and wireless broadband to offer services in international markets.
The company is also making its content available in different languages through subtitles by offering a Netflix button on TV remotes. This could make subtitles available in 17 languages in 70 countries around the world. Netflix is offering a mix of its original programming and local content in different countries.
Netflix makes up 0.19% of the Guggenheim S&P 500 Equal Weight ETF (RSP). For an investor interested in exposure to the software sector, RSP holds 3.5% in that space.
Browse this series on Market Realist: