Netflix might finally be striking the right balance between what it spends on TV programs like “The Crown” and “Stranger Things” and what it makes from subscribers. That’s the first step to generating cash.
Last year was the first time since 2014 that Netflix’s cash outlays on shows and movies grew more slowly than revenue from its streaming subscribers. Netflix brought in $110 from each subscriber last year, up 10% on 2016, but spent only $87.29 on content for each of them, up 5%. For the previous couple of years, content spending rose at a much faster rate than revenue, according to The Information’s analysis of Netflix’s financial disclosures. (See above chart).