Netflix plans to invest more and more in original content
Streaming giant Netflix has reported second quarter revenues of US$1.64bn and significant subscriber growth of 3.3m new subscribers, up from 1.7m subscribers a year ago.
Netflix CEO Reed Hastings said in a letter to subscribers: “We gained 0.9m new members in the US and added 2.4m members internationally in Q2.”
He said he believes the higher level of acquisition was fuelled by Netflix’s original programming, which includes Marvel’s Daredevil, Sense8, Dragons: Race to the Edge and the new season of Orange is the New Black, which set off a social media shockwave around the world.
“Nearly 99pc of Netflix members have engaged with Netflix original content, another indicator that we are on the right path,” Hastings said.
In total, Netflix has 65m subscribers, 42m in the US and 23m internationally.
Netflix plans to spend more and more on original content
Hastings said Netflix is spending more and more on original content and anticipates that global content spend will approach US$5bn in 2016.
The company is moving into the original film business, for example, and the first of its films Beasts of No Nation starring Idris Elba will be available in November.
Hastings said that Netflix is eating into the traditional linear TV and existing internet sources of entertainment, capturing 36pc of internet traffic in North America in the spring of 2015.
“We’re pleased to see the growing momentum of our original programming driving strong growth in the US and abroad” Hastings said.
“With our first set of international markets having achieved contribution profitability, we’ll be making our first foray into Asia this fall with our Japan launch, and are gearing up to offer our service around the globe.”
Netflix share of US streaming market
Netflix ‘Daredevil’ image via Shutterstock
