uploads///Netflixs contribution margin internationally

How Is Netflix Expanding Its Footprint Internationally?


Mar. 29 2019, Updated 10:07 a.m. ET

Netflix’s international expansion

Netflix (NFLX) has been generating more revenues in the global markets than the US market. Stiff competition in the streaming industry and the price hike for US members have likely been behind the weakness in the subscriber growth in the US.

During the fourth quarter, the streaming giant added ~7.31 million paid streaming members internationally, taking the total count to 80.77 international paid members. For the first quarter of 2019, the company expects to add 7.3 million paid subscribers internationally. Additionally, international streaming revenues soared 35.8% YoY to $2.11 billion. Netflix’s contribution margin was 3.9% in the international segment in the quarter, higher than the 2.5% margin in the year-ago quarter. Moreover, growth in international subscribers and revenues were higher than domestic subscriber and revenue growth.

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Original international shows

Netflix has grown to 190 countries driven by subscriber growth, strong growth in regional content, a robust portfolio, and partnerships with top local content creators and artists. Among several of its international projects, Netflix’s Spanish original, Elite, gained immense popularity worldwide in the first four weeks. Bodyguard, an original series from Italy, and Protector, an original series from Turkey, also became a hit in the first four weeks of their releases.

Netflix continues to expect to expand in the international markets such as Asia-Pacific including India (INDA), Mexico, Spain, Italy, Germany, Brazil (EWZ), France, Turkey and throughout the Middle East.


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