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Netflix again strikes the corporate bond market by announcing its intention to issue Monday $ 2 billion of bonds in bonds denominated in dollars and euros to help fund its heavy spending on movies and original television shows.
The company behind the hit series such as Room of cards and Orange is the new black plans to spend more than $ 8 billion on original content this year, up from $ 6 billion in 2017.
To finance this, Netflix has used debt rather than equity markets, even though its shares have jumped more than 73% this year. It raised $ 1.9 billion in April and $ 1.6 billion last October.
The news of the bond issue comes less than a week after Netflix announced earnings and earnings of subscribers stronger than expected for the third quarter. While the optimistic fourth-quarter results and forecasts that accompany them have eased fears of a slowdown, some analysts remain skeptical about the company's liquidity utilization rate.
Netflix expects cash usage of $ 3 billion this year and $ 3 billion in 2019, although it expects an improvement thereafter.
Long-term debt stood at $ 8.3 billion as at September 30, up from $ 6.5 billion reported at the end of 2017. Amount Spent for Interest Payments It's $ 291.6 million for the first nine months of the year, up from $ 238 million in 2017.
Moody's evaluates Netflix to Ba3, while S & P estimates it to BB-, both slots in "unwanted" territory.
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