Seeking Alpha

Netflix to ramp up European expansion

Netflix (NFLX) intends to enter France, Germany and four other European countries later this year, adding to online movie and TV subscription services that the company provides in the U.K., Scandinavia and the Netherlands.

Netflix will be jumping into crowded markets, with Amazon's Lovefilm set to be a major rival in Germany, while France has tough regulation.

The other European countries that Netflix intends to launch in are Austria, Switzerland, Belgium and Luxembourg.

Netflix's investment in expanding overseas means its international unit is likely to continue making a loss.

Netflix has 48M subscribers in over 40 countries, with over 12M of them outside the U.S. (PR)

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Comments (3)
  • JohnnyM
    , contributor
    Comments (254) | Send Message
    Cash expenditures for fueling subscriber growth comes at a price and the stock has already taken a needed beating. With $370 hit from the $320 level, NFLX has a void to slip into but will power brokers take the new 370+ NFLX cash or keep fueling the dream of much higher stock prices? jm
    21 May 2014, 05:01 AM Reply Like
  • Esekla
    , contributor
    Comments (4104) | Send Message
    I understand that Netflix has little choice but to try it, given that the U.S. market appears completely saturated, but wow, that's an awful lot of risk. Especially when many of their underlying services are provided by competitors like Amazon (who just won the rights to HBO shows, btw).
    21 May 2014, 12:48 PM Reply Like
  • Esekla
    , contributor
    Comments (4104) | Send Message
    Nomura apparently agress, they've lowered their EPS estimates based on increased costs from the expansion:

    21 May 2014, 01:38 PM Reply Like
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