Netflix is going to be doubling down on its original content offerings in 2015, since they offer a better return on investment for the company compared to some of its licensed content.
Company CEO Reed Hastings and CFO David Wells said in their quarterly letter to shareholders today that Netflix plans to increase how much it spends on original video programming like “House of Cards” and “Orange is the New Black” over the next several years, since it’s actually more efficient for the company to invest in it.
“Our originals cost us less money, relative to our viewing metrics, than most of our licensed content, much of which is well known and created by the top studios,” the letter read.
To that end, Netflix will be picking up another season of “Marco Polo,” which received a high user rating on Rotten Tomatoes, despite being a critical flop. The company is also in the process of launching new superhero shows as a part of a partnership with Marvel, as well as “Better Call Saul,” a prequel to “Breaking Bad.”
The company won’t be giving up on licensed content, though. The letter also revealed that Netflix will begin streaming “The Interview” to its members on January 24, 30 days after its video-on-demand release in the midst of a massive hacking controversy blamed on North Korea.
Netflix reported robust performance in the fourth quarter of 2014, bringing in $1.3 billion in streaming revenue, up 35 percent from the same period in 2013. The company reported earnings of 1.35 a share, with a net profit of $83 million. The company saw 1.9 million net customer additions in the U.S. during the quarter, down from 2.3 million during the same period in 2013.
Still, that was offset by international growth, with Netflix reporting a total of 4.33 million net additions worldwide, compared to almost 4.1 million additions in the fourth quarter of 2013. The company is accelerating its international expansion, too: it plans to open up its service in Australia and New Zealand in “Late Q1” of this year, and said that it plans to complete its global expansion over the next two years.
The company’s stock is up almost 13 percent in after hours trading as of this report.
Netflix’s detailed financial results are embedded below.
