Netflix is the leading online based subscription services for television shows and movies in the world. Its U.S. subscribers also have access to Blue-ray discs and DVDs, which are delivered directly to their houses. It has more than 40 million subscribers who stream movies and television shows. 31 million of these subscribers are located within the United States. Its DVD subscriptions currently stand at 7.1 million. One of the things that has made this company a success among subscribers is the availability of subscription plans without shipping fees, late fees, due dates and pay-per-view fees.
Online streaming has revolutionized how people watch TV shows and movies across the globe. Companies like Netflix have contributed to this change. Subscribers now have an opportunity to stream any movie or show at their own convenience. There are no restrictions on locations. This revolution can be attributed to the wide spread use of internet services. The internet services have also improved over the years and it is now possible to access online content at a faster rate. Netflix is different from the leading TV networks, which often interrupt shows and movies to air commercials. These networks rely on the revenue collected from commercials. Netflix does not need commercials to survive therefore subscribers can enjoy their movies or shows without interruption.
Netflix’s success can also be attributed to the unlimited viewing option that it offers for its subscribers. There are no limits on the number of shows or movies that one can stream. The streaming is possible through any device that is internet enabled. Subscribers are only required to pay a month fee to access the online content. This fee is affordable especially when users enjoy unlimited viewing.
Apart from the online streaming, Netflix produces television series. It has produced Hemlock Grove; Orange is the New Black, and House of Cards. This is an additional source of revenue for the company. One of the things that investors need to look for when exploring stock options is revenue sources. A diverse range of revenue sources protects a company especially when one of them is not profitable.
The company is also exploring ways to release movies online when they open in the theatres. This is an indication that the company is looking for innovative ways to generate revenue. By looking for fresh ways to offer its services, the company has managed to stay ahead of its competition. Investing in an innovative company is one of the best options because investors can be sure that the company will renovate itself to suit the dynamic business environment. Netflix recognizes that the entertainment industry is very competitive and consumer demands are always changing. The company has identified ways to remain relevant as TV networks struggle to retain their audiences.
Performance
The company has performed extremely well over the last year. It stock has risen from $50 to $350 in a little over one year. The good performance was accompanied by news that the company intends to launch in new markets in the coming year. This means that investors can look forward to higher revenues from the additional number of subscribers that the company will manage to get from the new markets. Its international streaming segment is likely to surpass its DVD segment if the company enters new markets. There is a lot of potential in international streaming because of the high number of prospective customers. It is estimated that the company will make about $1 billion from its international streaming segment. If the revenue from the international market is high, the stock value will go up and this translates to higher returns for Netflix investors.
Strategic Partnership
Netflix has partnered with Walt Disney Company. This partnership involves the development and production of various original shows. These shows will feature Marvel Super Heroes. This is wonderful news for investors who are in search of a stock that has significant growth potential. The partnership offers the company a chance to improve its shift towards development and production of original content. The company is likely to make higher revenues from original content compared to streaming movies and shows from other companies.
Netflix is a well established company and it has been in operation for a few years therefore an investor can trust the business model it is applying. The company is also looking for new revenue sources and this makes it a lucrative stock.