How do netflix finance their operations, what expenses impact them the greatest, how do they generate revenue and profits? how they make profits to pay for this capital and the return requirements for lenders/investors

Netflix is an online streaming platform which has changed the meaning of watching television or movies.

To create the customer base for their platform they are paying a very good amount to the makers of the show, so that they will have an edge over the competitors. Netflix is currently focusing on increasing its subscribers base so that they have enough customers for their platform.

So, that's why company is generating finances with the help of debts to pay their existing liablities and again getting it. And with time this scenerio will change and in the future they didn't need any debt to payoff their debts.

The company spents more then 70 percent of revenues on content. Because the variability of content is what that attracts the customers, that's the sole reason that company is spending so much on the content.

And with good content they can increase the traffic on there platform.

The major source of revenue of Netflix is it's subscribers who are paying $8.99 to $15.99 per month. Netflix quarterly revenue are in millions because of having so much subscribers and it's increasing day by day. For example - to promote their platform they are offering only Indians free shows of Saturday and Sunday for some time, so that more person can subscribe to it.

Other source of revenue is that they provide DVD rental services and they charge some amount for it. So these are the sources through which they generate their revenues.

So currently Netflix is under debt, because the quality content which they are providing right now is costly and to cover that cost they need huge amounts. The cost of debt here is compared with the quality of content which attracts the customers. And that's how they are managing to get a good amount of debts, also this pandemic has also favoured this OTT paltforms because plenty of persons are having so much time to watch any show, movie, etc.

Most of the persons are in doubt that Netflix won't be able to pay its debts if they can't generate enough traffic, and it will be bankrupt.

So now Netflix is using both it's profits and debts to finance its business. And also the low tax they have to pay because of debts is also a benefit for them and that's why they are using more debt and less of their own funds.