question: How could Netflix possibly be profitable considering the billions of dollars of debt they are amassing to put out all their content and buy streaming rights to existing properties?
comment: They have the largest subscriber base by far and they make a ton of money from the data they collect.
passages: Since 2012, Netflix has taken more of an active role as producer and distributor for both film and television series, and to that end, it offers a variety of "Netflix Original" content through its online library. By January 2016, Netflix services operated in more than 190 countries. Netflix released an estimated 126 original series and films in 2016, more than any other network or cable channel. Their efforts to produce new content, secure the rights for additional content, and diversity through 190 countries have resulted in the company racking up billions in debt: $21.9 billion as of September 2017, up from $16.8 billion from the previous year. $6.5 billion of this is long-term debt, while the remaining is in long-term obligations. In October 2018, Netflix announced it would raise another $2 billion in debt to help fund new content.
   On January 22, 2018, the company crossed $100 billion in market capitalization, becoming the largest digital media and entertainment company in the world, bigger than every traditional media company except for AT&T, Comcast and Disney and the 59th largest publicly traded company in the US S&P 500 Index.
   According to Global Internet Phenomena Report Netflix consumes 15% of all Internet bandwidth globally, the most by any single application.
  
  In October 2018, Netflix acquired ABQ Studios, a film and TV production facility with eight sound stages in Albuquerque, New Mexico. The reported purchase price is under $30 million.
   Section::::Finance and revenue.:2016.
  
  In April 2016, Netflix announced it would be ending a loyalty rate in certain countries for subscribers who were continuously subscribed before price rises. Netflix spent about $5 billion on original content in 2016; this compares to a 2015 revenue of US$6.77 billion (2015).
  
  Section::::Criticism.
  
  Section::::Criticism.:Film distribution model.
   In October 2017, Netflix iterated a goal of having half of its library consist of original content by 2019, announcing a plan to invest $8 billion on original content in 2018. There will be a particular focus on films and anime through this investment, with a plan to produce 80 original films and 30 anime series. In September 2017, Minister of Heritage Mélanie Joly also announced that Netflix had agreed to make a CDN$500 million (US$400 million) investment over the next five years in the production of content in Canada. The company denied that the deal was intended to result in a tax break. A study found that Netflix had realized this goal by December 2018,
   In May 2014, Netflix increased the fee for UK subscribers by £1. The price increase took effect immediately for new subscribers, but would be delayed for two years for existing members. Netflix applied similar increases in the United States (an increase of $1) and the Eurozone (an increase of €1). According to "Forbes", "Netflix can add roughly $500 million in annual incremental revenues in the U.S. alone by 2017 with this move" and "roughly $200–250 million in incremental revenues from price changes in international markets". However, Reuters' Felix Salmon is critical about Netflix's financial future, noting that "any time that Netflix builds up a profit margin, the studios will simply raise their prices until that margin disappears".
   In the final quarter of 2013, Netflix gained more new subscribers from its pool of countries than it did from the United States for the first time since it began its European expansion, making international expansion increasingly important. As media analyst Anthony Wible has been quoted as saying, "There are only so many people in the United States. The rest of the world is far bigger and the addition of domestic subscribers will start to slow down at some point." At the end of 2013, the company had reached approximately 32 million users in the United States and had additionally had approximately 10 million users internationally.
   For the fiscal year 2018, Netflix reported earnings of 1.21 billion, with an annual revenue of 15.8 billion, an increase of approximately 116% over the previous fiscal cycle. Netflix's shares traded at over $400 per share at its highest price in 2018, and its market capitalization reached a value of over 180 billion in June 2018. Netflix ranked 261 on the 2018 Fortune 500 list of the largest United States companies by revenue.
  
  Section::::Services.
   Sarandos sees Netflix as a digital product, where the balance between distributing physical bits of content versus streaming digital content would be cheaper as both broadband and Netflix grew, i.e. postal economics vs. streaming economics. This was something that Sarandos said he and his team was closely analyzing at a micro fiscal level. The shift away from the DVD business comes from this evaluation of new model focused on streaming and includes original programming, which is one of the main responsibilities of Sarandos' work at Netflix.
   In March 2011, Netflix began acquiring original content for its library, beginning with the hour-long political drama "House of Cards", which debuted in February 2013. The series was produced by David Fincher, and starred Kevin Spacey. In late 2011, Netflix picked up two eight-episode seasons of "Lilyhammer" and a fourth season of the ex-Fox sitcom "Arrested Development". Netflix released the supernatural drama series "Hemlock Grove" in early 2013.
  
  In February 2013, DreamWorks Animation and Netflix co-produced "Turbo Fast", based on the movie "Turbo", which premiered in July. Netflix has since become a major distributor of animated family and kid shows.
   In January 2013, Netflix reported that it had added two million United States customers during the fourth quarter of 2012, with a total of 27.1 million United States streaming customers, and 29.4 million total streaming customers. In addition, revenue was up 8% to $945 million for the same period. That number increased to 36.3 million subscribers (29.2 million in the United States) in April 2013. As of September 2013, for that year's third quarter report, Netflix reported its total of global streaming subscribers at 40.4 million (31.2 million in the United States). By the fourth quarter of 2013, Netflix reported 33.1 million United States subscribers. By September 2014, Netflix had subscribers in over 40 countries, with intentions of expanding their services in unreached countries. By October 2018, Netflix's customer base reached 137 million worldwide, confirming its rank as by far the world's biggest online subscription video service.
   In November 2018, Paramount Pictures signed a multi-picture film deal with Netflix as part of Viacom's growth strategy, making Paramount the first major film studio to sign a deal with Netflix. A sequel to Awesomeness Films' "To All the Boys I've Loved Before" is currently in development at the studio for Netflix.
  
  Netflix sought and was approved for membership into the Motion Picture Association of America (MPAA) on January 22, 2019 as the first streaming service to become a member of the association.
   In November 2017, Netflix announced that it would be making its first original Colombian series, to be executive produced by Ciro Guerra.
  
  In May 2018, chief content officer Ted Sarandos stated that Netflix had increased its spending on original content, with 85% of its new content spending that year being devoted to it.
  
  On December 31, 2018, a concert film of Taylor Swift's Reputation tour was released on Netflix.
  
  In February 2019, Gwyneth Paltrow's lifestyle brand Goop signed a deal to produce a wellness-themed docuseries for Netflix.
  
  Section::::Content.:Film and television deals.
   Netflix continued to dramatically expand their original content in 2016. The science fiction horror "Stranger Things" premiered in July 2016, music-driven drama "The Get Down" in August, historical drama "The Crown" in November, and the year's premieres included comedy shows such as "Love", "Flaked", "", "The Ranch", and "Lady Dynamite". Netflix released an estimated 126 original series or films in 2016, more than any other network or cable channel.
   Section::::Finance and revenue.:2010.
  
  In 2010, Netflix's stock price increased 219% to $175.70 and it added eight million subscribers, bringing its total to 20 million. Revenue jumped 29% to $2.16 billion and net income was up 39% to $161 million.
  
  Section::::Finance and revenue.:2011.
  
  In April 2011, Netflix was expected to earn $1.07 a share in the first quarter of 2011 on revenue of $705.7 million, a huge increase compared to the year-earlier profit of 59¢ on revenue of $493.7 million, according to a survey of 25 analysts polled by FactSet Research.
   Solutions Research Group conducted a study in June 2016 that indicated that 5.2 million Canadian households subscribe to Netflix. In the same study, Crave and Shomi together had fewer than 700,000 subscribers.
   Netflix's initial business model included DVD sales and rental by mail, but Hastings abandoned the sales about a year after the company's founding to focus on the initial DVD rental business. Netflix expanded its business in 2010 with the introduction of streaming media while retaining the DVD and Blu-ray rental business. The company expanded internationally in 2010 with streaming available in Canada, followed by Latin America and the Caribbean. Netflix entered the content-production industry in 2012, debuting its first series "Lilyhammer".
   In April 2011, Netflix had over 23 million subscribers in the United States and over 26 million worldwide. In July 2011, Netflix changed its prices, charging customers for its mail rental service and streaming service separately. This meant a price increase for customers who wanted to continue receiving both services. On October 24, Netflix announced 800,000 unsubscribers in the United States during the third quarter of 2011, and more losses were expected in the fourth quarter of 2011. However Netflix's income jumped 63% for the third quarter of 2011. Year-long, the total digital revenue for Netflix reached at least $1.5 billion. On January 26, 2012, Netflix added 610,000 subscribers in the United States by the end of the fourth quarter of 2011, totaling 24.4 million United States subscribers for this time period. On October 23, however, Netflix announced an 88% decline in profits for the third quarter of the year.
   In April 2014, Netflix signed "Arrested Development" creator Mitch Hurwitz and his production firm The Hurwitz Company to a multi-year deal to create original projects for the service. The period drama "Marco Polo" premiered on December 12, 2014. The animated sitcom "BoJack Horseman" premiered in August 2014, to mixed reviews on release but garnering wide critical acclaim for the following seasons.
   Netflix also began to acquire distribution rights to third-party films in 2017 into 2018. One of its first acquisitions was the film "The Cloverfield Paradox", which Netflix had acquired from Paramount Pictures in early 2018, and launched on its service on February 4, 2018, shortly after airing its first trailer during Super Bowl LII. While the film was critically panned, analysts believed that Netflix's purchase of the film helped to make the film instantly profitable for Paramount compared to a more traditional theatrical release, while Netflix benefited from the surprise reveal. Other films acquired by Netflix include international distribution for Paramount's "Annihilation", worldwide distribution of Universal's "Extinction", and Warner Bros.' "".
   On January 22, 2019, Netflix scored 15 nominations for the 91st Academy Awards, including Best Picture for Alfonso Cuarón's "Roma", which was nominated for 10 awards. The 15 nominations equal the total nominations Netflix had received in previous years. Its increased presence in the Academy Awards has led filmmakers such as Steven Spielberg to speak out against the nomination of streaming content. As a possible solution, Netflix is in the process of buying Grauman's Egyptian Theatre to host events and screen its films and series. However, there are no plans to roll out full theatrical releases there.
  
  Section::::Finance and revenue.
   In 2013, "Forbes" magazine estimated that international streaming accounted for 15% of the company's value. Netflix has subscribed approximately 30% of households in the United States. If able to replicate that in the United Kingdom and Scandinavia alone the company would add 12 million users.
  
  Section::::2015: Australia, New Zealand, Japan and China.
  
  Expansion to Australia and New Zealand occurred on 24 March 2015. On February 4, 2015, expansion to Japan was announced to begin during the fall of 2015.
   Netflix's website has 117.6 million subscribers as of 2018, with 8.3 million being added in the fourth quarter of 2017. As of January 28, 2018, Netflix's website ranked as the 30th most trafficked website in the world and 9th most trafficked website in the United States.
  
  Netflix has a Twitter feed, used to tweet about the new and upcoming shows that include hashtags to encourage engagement of their audience to not only watch the show but to contribute to the hashtag themselves.
  
  Section::::International expansion.
   In September 2017, the company raised USD$156 million, giving it a total valuation of USD$1.4 billion and making it a "unicorn", the term given to start-ups worth more than USD$1 billion.
  
  Section::::Products and services.
   On August 16, 2018, Netflix announced a three-year overall deal with "black-ish" creator Kenya Barris. Under the deal, Barris will produce new series exclusively at Netflix, writing and executive producing all projects through his production company, Khalabo Ink Society.
  
  On August 27, 2018, Netflix signed a five-year exclusive overall deal with international best–selling author Harlan Coben. Under the multi-million pact, Netflix will work with Coben to develop 14 existing titles and future projects. On the same day, the company inked an overall deal with "Gravity Falls" creator Alex Hirsch.
  
raw_presuppositions: Netflix should not be profitable. If a company has billions of debt, it cannot be profitable.
raw_corrections: Netflix brings in more subscribers than you think and does make a profit.  Companies can make money from the data they collect.