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NetFlix To Borrow $2 Billion More... Total Debt $15.5 Billion

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adterp

We are so used to see/read/hear these insane amounts of money in medias, that we are now completely desensitized by it. 

15 500 000 000 $, it's the GDP of Mali in 2018 : 20 000 000 of people ! 1 company moves more money than one of the biggest country of Africa. Just imagine the possibilities.

Plus I feel like Netflix is not here for the long run. Watch it being in dept until the end of it with bank money, aka your money. For the kinda bad addictive content they offer, I'm glad they don't get a single € or data info from me. 

Try Mubi people. 

Edited by adterp
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Rio
1 hour ago, tomsches said:

Wow I didn't know that. Thankfully I dont pay for my account :lolly:

thankfully??? you not paying cant help them lol 😆

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Rio
8 minutes ago, adterp said:

We are so used to see/read/hear these insane amounts of money in medias, that we are now completely desensitized by it. 

15 500 000 000 $, it's the PIB of Mali in 2018 : 20 000 000 of people ! 1 company moves more money than one of the biggest country of Africa. Just imagine the possibilities.

Plus I feel like Netflix is not here for the long run. Watch it being in dept until the end of it with bank money, aka your money. For the kinda bad addictive content they offer, I'm glad they don't get a single € or data info from me. 

Try Mubi people. 

Mubi doesn't exactly have an extensive range like Netflix lol, or any original shows. It's a heavily curated streaming service, and for the price, hardly worth it

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Lord Temptation
13 minutes ago, adterp said:

We are so used to see/read/hear these insane amounts of money in medias, that we are now completely desensitized by it. 

15 500 000 000 $, it's the GDP of Mali in 2018 : 20 000 000 of people ! 1 company moves more money than one of the biggest country of Africa. Just imagine the possibilities.

Plus I feel like Netflix is not here for the long run. Watch it being in dept until the end of it with bank money, aka your money. For the kinda bad addictive content they offer, I'm glad they don't get a single € or data info from me. 

Try Mubi people. 

Of course Netflix was never in it for the long haul.

Every start-up aims to be bought by their enemy. Pumping the company full of debt artificially increases the sales price. When the start-up gets sold, the original owners get a windfall, and the new owners have just eliminated another competitor. So it’s win-win. And naturally, the consumer always loses out.

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adterp
9 minutes ago, Rio said:

Mubi doesn't exactly have an extensive range like Netflix lol, or any original shows. It's a heavily curated streaming service, and for the price, hardly worth it

Depends on what you are looking for. Netflix gives you just the illusion of choice. You actually spend more time scrolling and finally choose a lame show than watching something actually stimulating. But I understand that Netflix fulfills mainly entertainment needs. 

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Economy
34 minutes ago, Lord Temptation said:

But Amazon has lots of inventory, logistics, real estate and transport. What assets does Netflix have?

Thats why “net debt” (debt subtracted by assets) is also important to take into account to get the overall picture

 

that being said gross debt is also important because assets like their inventory and transport are vital to their business functioning. These are not assets they would sell unless they got really desperate

 

So since not all assets are easily liquidable, the total debt relatove to revenue is important as well to get a proper picture of how well the companies balance sheet is doing

 

But when calculating a companies solvency, net debt is important too. I suspect like u suggested, a company like Amazon probably has way more assets that can be subtrated from their net debt than a company like Netflix

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Economy
47 minutes ago, Miracle said:

They should stop making so much original content.

Actually in the long term that will help them with costs...

 

Anything thats original from netflix only has a production cost once and then they can keep it in their data base forever

 

shows they purchase they have to renew the licensing rights to whoever owns the production. They either have to remove it, or keep paying to keep a show available

 

original content costs them a lot now but will save them later on

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Economy
1 hour ago, AlexanderMagno said:

It's not that I understand Economics that much, but if I'm not mistaken I've come to realise that most businesses live like that:rip: looks like that's how the whole world works, by managing its huge debts. At the end of the day, money is just a concept far more complex than its amount, and a business stands for much more.

Pretty much. Even a company once its more or less established, it will grow very slowly if it only re-invests its profits

 

companies that get agressive and want to take a lot of market share have to borrow money to get there. As long as their cashflow and revenue grows along with their debt and the company can manage it, its not an issue

 

If the debt grows at a faster rate than the company, thats when they run into serious trouble

 

Interesting fact, Corporate debt is one of the sources of income pension funds invest in

 

Most retirement funds have bonds in them (not just equity) and usually at least some of it is Corporate bonds. They also usually pay a tad bit more interest than Government Bonds

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Lord Temptation
2 minutes ago, Economy said:

Thats why “net debt” (debt subtracted by assets) is also important to take into account to get the overall picture

 

that being said gross debt is also important because assets like their inventory and transport are vital to their business functioning. These are not assets they would sell unless they got really desperate

 

So since not all assets are easily liquidable, the total debt relatove to revenue is important as well to get a proper picture of how well the companies balance sheet is doing

 

But when calculating a companies solvency, net debt is important too. I suspect like u suggested, a company like Amazon probably has way more assets that can be subtrated from their net debt than a company like Netflix

All those ratios remind me of accounting at uni all those years ago (i hated them but got good grades!)

Yes, for some reason even though Amazon is a tech company it still feels like a traditional blue chip company, especially now that they have branched into retail. 

Netflix, on the other hand, is like Uber. They literally survive because of debt, and having liquid assets would actually be a drain on them. The less they own the better.

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gabeoz
45 minutes ago, Lord Temptation said:

But Amazon has lots of inventory, logistics, real estate and transport. What assets does Netflix have?

A fast growing subscriber base in one of the largest growing sectors in tech. 

 

Netflix continues to be able to borrow money because it’s continued success in growing its base and catalog, so investors are happy to invest more money it. Even when they have to start paying their debts, it will be in minimal amounts so it won’t really affect them. 

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Lord Temptation
6 minutes ago, gabeoz said:

A fast growing subscriber base in one of the largest growing sectors in tech. 

 

Netflix continues to be able to borrow money because it’s continued success in growing its base and catalog, so investors are happy to invest more money it. Even when they have to start paying their debts, it will be in minimal amounts so it won’t really affect them. 

Ok, i don’t read up about it and am not a subscriber myself, so I take your word. But as i said above I don’t think Netflix is in it for the long run. All this debt is a strategy to boost it’s value, as they are clearly looking for a buyer (ahem Disney).

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AlexanderMagno
26 minutes ago, Economy said:

Pretty much. Even a company once its more or less established, it will grow very slowly if it only re-invests its profits

 

companies that get agressive and want to take a lot of market share have to borrow money to get there. As long as their cashflow and revenue grows along with their debt and the company can manage it, its not an issue

 

If the debt grows at a faster rate than the company, thats when they run into serious trouble

 

Interesting fact, Corporate debt is one of the sources of income pension funds invest in

 

Most retirement funds have bonds in them (not just equity) and usually at least some of it is Corporate bonds. They also usually pay a tad bit more interest than Government Bonds

Have you studied Economics, or do you simply read on your own? If you do that, how do you study these things? I really want to get into it, it's so damn complex :giveup:

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Economy
56 minutes ago, AlexanderMagno said:

Have you studied Economics, or do you simply read on your own? If you do that, how do you study these things? I really want to get into it, it's so damn complex :giveup:

I didnt study it officially. Im just really into economics. I read articles on the economy as it develops on a daily basis on Canada, the US, Europe, China etc

 

i read articles on many side issues and different points of view on social and economic issues in addition to interviews

 

I also had to learn about the corporate world during the time i was investing.

 

Even then, being exposed to this stuff daily for hours (cuz im so into it) it still took me many years to know what i know now

 

I have a friend whos an equity analyst in the city of Oakville (his farther aparently is the portfolio manager of a Billion Dollar fund tho i never met him :rip:)...

 

Not to brag but... He had to go to University for 4 years and in our conversations i can match to his level on most things and can argue and debate things with him on his level... tho there are some monetary technicalities especially in the business world that he knows in more detail than me obviously :selena:

 

Also based on what i know im not a right or left wing supporter and i think its rediculous that society and politics has created specific economic ideologies that ppl stick to in stone. To put it bluntly, the right way to run an economy is a lot more complicated than that

 

thats why u may have noticed i dont strongly support a specific party

 

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