Netflix beats forecasts for international growth
Netflix saw international paid for subscriptions beat Q4 forecasts, while new domestic and Canadian subscriptions fall short of targets.
The company reported that Canada & the US new subscriptions amounted to 420,000 in Q4 compared to 1.5 million a year ago, the third time in a row they have not met these targets. As competitors such as Disney+ and Apple TV+ continue to launch domestically, international territories are now a key area for growth. Overall the company added 8.33 million subscribers internationally, above its forecast of seven million.
Localised international content has long been a part of the Netflix’s global strategy, and the company has continued to increase footprint in international markets and spending on original content from around the globe.
Investment in Spanish language content, such as Casa de Papel, House of Flowers and Elite has positively impacted subscriber numbers in Latin America.
Recent notable international originals from the streamer include the first Mandarin language original Nowhere Man (pictured) which filmed in Taiwan, and the first Arabic original Jinn which filmed in Jordan.
A focus on international growth could increase Netflix’s global production spend further as it invests in original content. This week Netflix opened a new French HQ, its fourth office in Europe, and said it was involved in over twenty French productions in 2020. Other recent international partnerships include a three-year deal with Korean media conglomerate CJ ENM for originals and distribution of selected titles and with Mexican director-writer-producer Manolo Caro (The House of Flowers) who signed an exclusive production pact with Netflix in May 2019.
The report comes days after market analyst Dan Salmon at BMO Capital Markets estimates that Netflix will spend US17.3 billion on content in 2020, up from US15 billion in 2019. He also adds that Netflix's investment into content will grow to US26.3 billion by 2028 to keep pace with streaming rivals, much of this on original content.
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