Internet television network, Netflix, Inc. (NFLX), plans to air the movie The Interview for its 53 million global subscribers. The movie failed at the box office and earned only $5 million. However, reportedly, Sony Pictures garnered $31 million in digital and video-on-demand sales after major movie theaters refused to run it at Christmas time due to the controversial content.
However, having gained popularity over the Internet, we are hopeful that The Interview will be a hit among Netflix’s on-demand video streaming customers. The movie is the current favorite on Google’s (GOOGL), YouTube, Google Play, Microsoft's (MSFT) Xbox Video and other video-on-demand services.
Going forward, we believe that Netflix’s partnerships with major film studios and production houses like CBS Corp (CBS), Sony Pictures, The Weinstein Company and Walt Disney are helping it to add hit content to its Internet television library. As a result, Netflix has a robust line-up of shows that should lead to subscriber growth in the near future.
Upcoming Netflix shows include five original series based on Marvel superhero characters starting with Daredevil this May. Other original shows in the works are science-fiction tale Sense 8 from the makers of The Matrix and a comedy Grace and Frankie starring Jane Fonda and Lily Tomlin. Reportedly, Netflix is also coming up with shows like Unbreakable Kimmy Schmidt, Bloodline andMarco Polo throughout the year.
Although we believe that a fast growing subscriber base will drive Netflix’s top line this year, rising content costs and expenditure related to international expansion are major headwinds.
Currently, Netflix has a Zacks Rank #4 (Sell).
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