File photo. Photograph:( AFP )
Netflix Inc said on Monday it planned to raise $1.5 billion in debt as the video streaming pioneer continues a rapid expansion in production of original shows.
The company said it intends to use the net proceeds from the offering for general corporate purposes, which may include content acquisitions, production.
In announcing the planned debt financing Monday, Netflix included the standard boilerplate that it expects to use the net proceeds “for general corporate purposes,” but the company has been clear that it’s plowing capital into content.
Netflix reported booming first-quarter 2018 results last week, exceeding subscriber-growth estimates both in the U.S. and abroad, to hit 125 million total streaming customers at the end of the period. The company reiterated that it expects content spending to be $7.5 billion to $8 billion for 2018 on a profit/loss basis, in line with its previous estimates.
Netflix crushed Wall Street’s estimates for subscriber additions earlier this month, driven by hit original shows “Altered Carbon” and “Jessica Jones”, and said it looks to spend nearly $8 billion on content in 2018.
Netflix shares were up 1 per cent in premarket trading.