Around the Net
Netflix Ready to Write-Off 2012
- Business Insider, Tuesday, November 22, 2011 11:54 AM
After a brutal 2011, couldn’t Netflix end the year on a nice note? Unfortunately not, as the DVD-by-mail-cum-streaming-media company now says it plans to loose money throughout 2012. “Yes, that's the latest news that Netflix tucked into the prospectus for the stock portion of its stock and convertible bond offerings,” according to Business Insider’s Henry Blodget. What stock offering? Well, despite its stock plummeting from $300 to about $75 in five months, the battered company needs to raise $400 million to fund its content strategy, according to Blodget.
Regarding next year’s projected loss, Netflix writes: “We expect that consolidated quarterly revenue will be relatively flat until we can achieve positive net subscriber additions. As a result of the relatively flat consolidated revenues and previously announced increased investment in our International segment, we expect to incur consolidated net losses for the year ending December 31, 2012.”
As Blodget notes, Netflix previously said it might lose money for the first few quarters of 2012, but not the entire year. “So this is a change.” Yet, Blodget does plan on preparing Netflix’s obit just yet. “I'm optimistic,” he writes regarding the company’s future.
