Netflix stocks went soaring this week after recent analyses showed that many investors have underestimated the streaming service’s potential for international growth. Netflix has been on a massive worldwide expansion lately, opening up a new state-of-the-art multilingual support center in Amsterdam and even managing to find a foothold in the notoriously closed-off Chinese media market. Earlier this year, however, several reports indicated that Netflix investors were beginning to worry about the company’s “spend first, profit later” business model. Now, with this recent stock surge, those investors’ worries should have calmed down a bit.
According to Variety, Netflix stocks closed Thursday, May 25th at an all-time high closing price of $163.05 a share, a 3.4% increase for the day. That boost in stock price came on the heels of a statement by influential market analyst Michael Olson, who claims that current projections of Netflix’s future potential earnings fail to take into account the recent spree of international outreach Netflix has been engaging in:
While Netflix currently has a limited content offering outside of the U.S. and has done less marketing in many of the recently entered countries, we believe that, by 2020, there is potential for market penetration higher than current estimates.
Netflix currently boasts close to 48 million international subscribers. However, given the recent push for over $1 billion in funding for more international content and some favorable changes to international regulations, Netflix’s international reach is expanding rapidly in many parts of the world. If their global strategy pays off, ‘Netflixing and chilling’ might soon be the new universal language. Sure beats Esperanto.
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