Netflix is undefeated (reprise)

The king of streams continues to make it look easy

• Netflix profits to the moon

• Converting expensive content into subscribers is easy, though, right? Ask Apple

• YouTube is the only competition that seems to matter

---

👉👉👉Reminder to sign up for the Weekly Recap only, if daily emails is too much. Find me on twitter, for more fun. 

Netflix is undefeated (reprise)

It’s hard to understate how far ahead Netflix is relative to other streamers.

Netflix is on pace to deliver ~$40B in revenue, and ~$9B in profit this year:

Bloomberg

Netflix’s first half profits of ~$4.5B are almost double the previous years, on both improved topline and margins.

Now, in order to generate that $40B in revenue, Netflix spends about ~$16B/year on content. That’s substantially more than anyone else (besides Amazon), but when it’s all said and done, spending $16B to generate $40B is a good trade.

Seems like an easy formula, right? Spend a bunch of money to make and license content, build a wizbang automagical recommendation engine, and then watch the subscription revenue roll in.

Apple makes lemons

Consider AppleTV, for example.