Netflix suffering after demanding expansion programme
NETFLIX is set to announce that its full-year profits have crashed because of losses caused by its international expansion and its costly investment in original programming.
Netflix is expected to report that its pre-tax profits have tumbled by 62 per cent
On Tuesday, the subscription video-on-demand service, which is believed to have 4.5 million users in the UK alone, is expected to report that its pre-tax profits have tumbled 62 per cent to $132.1 million (£91.7 million), according to the consensus forecast from Wall Street analysts.
Its profitability has been hit by the US firm’s costly expansion last year into Spain, Italy, Portugal, Japan, Australia and New Zealand and its continued investment in original programming, such as TV shows Better Call Saul, Orange Is The New Black, Daredevil and House Of Cards, as well as movies such as Adam Sandler’s The Ridiculous 6, which was universally panned by critics.
The company continued to invest in original shows such as Better Call Saul
Kevin Spacey is the star of Netflix original series House of Cards
Despite the fall in its profits, Netflix is set to report that its revenues have risen 23.1 per cent to $6.8 billion, as its growing number of subscribers outside the US has more than offset slowing growth in its home market.
It has 69 million subscribers globally and has produced original TV shows for Mexico and France and will film its first series in Brazil this year.