Netflix Announces $1.6 Billion Senior Note Offering

Netflix announced a $1.6 billion senior note offering to institutional buyers Monday. It plans to use the proceeds for general corporate purposes, including content acquisitions, production and development, capital expenditures, investments, working capital and potential acquisitions and strategic transactions, it said. The company said in its most recent shareholder letter (see 1710160062) it had 5.3 million net subscription streaming additions in Q3, significantly better than the 4.4 million net additions it predicted in July. Netflix in the past four years has taken a long-term view “that we’re in the early stages of the worldwide, multi-decade transition from linear TV to internet entertainment,” the letter said, citing Disney’s announced plans to launch direct-to-consumer services for ESPN and its other brands and the international expansion of CBS All Access. The letter didn't mention Disney's decision to pull its films from Netflix starting in 2019 (see 1709080027). Linear TV networks are “cutting down on scripted series” as online services like Netflix have “ramped up activity,” it said. Netflix raised subscription prices on its monthly mid- and top-tier services this month to $10.99 for two screens of simultaneous viewing, including HD, and downloads for two mobile devices, and to $11.99 for four screens of HD and Ultra HD viewing and downloads for four devices. Its basic tier remains $7.99 monthly.