Worse yet amortization of streaming content will rise by at least $100 million in the next year it grew 30% sequentially, this means profits will drop dramatically going forward since revenue is no longer increasing. If content costs continue their skyrocketing rate then Netflix may report shaply lower profits or a loss in the next year. We calculate content costs could rise to over $200 million a quarter.
Even worse yet the company's financial position is treacherous. Its current ratio which was never that impressive has gone from 6/4 to almost 1/1. Current assets excluding content shows a current ratio of 1/2. Netflix appears to be on the net track towards bankruptcy protection.
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Bankruptcy? What a joke.
ReplyDeletelook at their current ratio. Its a terrible financial condition.
ReplyDeleteSo they raised their fees by 60% and lost about 5% of their customer base. This is bad news...why?
ReplyDeleteCuz earnings declined by $6 million and are expected to decline by 50% next quarter and likely more in 2012 with more costs and subscriber base is likely to continue to drop. All with a horrible balance sheet.
ReplyDeleteGood News Where?
Seems like an overreaction to me. They beat expectations in everything except subscriber losses.
ReplyDeleteWhat about the next quarter! Guidance was bad, really bad.
ReplyDelete