Netflix expects international sales to overtake US sales this quarter
Netflix expects international sales to overtake US sales for the first time in the current quarter.
The forecast was made after the streaming giant reported much better-than-expected quarterly growth in subscribers and revenue.
Netflix has over 125 million subscribers after adding 7.4 million subscribers in the first quarter – of which nearly three-quarters came from outside the US.
Revenue rose 43% in the three months to March to $3.7bn (£2.6bn).
The company’s performance suggests that its strategy of investing in original content is working on increasing subscription numbers.
“We’ve outperformed the business in a way we didn’t predict,” David Wells, Netflix’s CFO, said on a conference call with analysts Monday. “The business has grown faster than we expected.”
For Q2, Netflix expects 6.2 million global net additions (1.2 million in the US and 5.0 million for the international segment) compared to 5.2 million in the year ago quarter.
The company said it will spend $7.5-$8 billion on content in 2018 across a wide variety of formats (series, films, unscripted, docs, comedy specials, non-English language) to “serve the diverse tastes of our growing global membership base.”
While Netflix faces competition from rivals such as Amazon, Apple and Disney who are ramping up investment in their own original content, analysts believe that Netflix is too dominant to lose now.
Deutsche Bank analyst Brian Kraft said: “Netflix has changed the industry in a profound way and in doing so has given itself a significant lead, making it very difficult for the traditional media companies, or even other big tech companies, to catch up,”