https://www.thefader.com/2017/07/31/netflix-20-billion-debt
Netflix's enormous spending on original content has led the streaming video platform to accrue $20.54 billion "in long term debt and obligations," according to a report in the Los Angeles Times.
The company is expected to spend $6 billion on original content this year, with an undetermined budget spent on licensing fees for programs from TV studios. Its net cash outflow will increase this year to $2.5 billion, up from $1.7 billion, and the company expects "to be free-cash-flow negative for many years."
Investors seem content with Netflix's financial game plan, and are hopeful that debt financing will "create growth" in the short term. The company has continued to build its base of subscribers paying for the service (104 million, up 25% from 2016) and gather critical acclaim for original shows – its programming won 91 Emmy nominations last year spread over 50 shows.
However, some industry experts are warning of a "Netflix bubble" if the platform's original content fails to keep attracting users. "I think they're going to need some luck in not drowning in debt in the ultimate slowdown of growth," said media consultant Mike Vorhaus, while analyst Michael Pachter warned of "a looming write-down."