Advances in Economics, Management and Political Sciences

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Proceedings of the 7th International Conference on Economic Management and Green Development

Series Vol. 30 , 10 November 2023


Open Access | Article

Analyzing the Debt’s Effects on Netflix’s Liquidity and Costs

Lingchao Wu * 1
1 Macau University of Science and Technology

* Author to whom correspondence should be addressed.

Advances in Economics, Management and Political Sciences, Vol. 30, 118-124
Published 10 November 2023. © 2023 The Author(s). Published by EWA Publishing
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Citation Lingchao Wu. Analyzing the Debt’s Effects on Netflix’s Liquidity and Costs. AEMPS (2023) Vol. 30: 118-124. DOI: 10.54254/2754-1169/30/20231451.

Abstract

Netflix has issued substantial sums of debt in 2018 and 2019 in order to expand its content library and deal with the intense rivalry that exists in the streaming media sector. The objective of this paper was to investigate the ways in which Netflix's liquidity and costs of financing are impacted by the use of long-term debt financing. The annual reports that Netflix produced from 2017 through 2022 were scrutinized in great detail. According to the findings of this research, Netflix did not experience any liquidity issues in 2018 and 2019 as a result of its long-term debt financing. Therefore, organizations that provide streaming media may utilize long-term debt financing in order to make short-term investments if they managed the due dates of their loan in an appropriate manner. Meanwhile, based on the findings of this study, Netflix was able to reduce the costs associated with debt by issuing debt mostly in euros and using fixed interest rates. When interest rates are forecasted to rise, it may be beneficial for businesses to cut their debt costs by taking on debt denominated primarily in euros and offering fixed interest rates.

Keywords

Netflix, long-term debt, liquidity, costs of debt

References

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Data Availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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Volume Title
Proceedings of the 7th International Conference on Economic Management and Green Development
ISBN (Print)
978-1-83558-081-3
ISBN (Online)
978-1-83558-082-0
Published Date
10 November 2023
Series
Advances in Economics, Management and Political Sciences
ISSN (Print)
2754-1169
ISSN (Online)
2754-1177
DOI
10.54254/2754-1169/30/20231451
Copyright
© 2023 The Author(s)
Open Access
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited

Copyright © 2023 EWA Publishing. Unless Otherwise Stated