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The bond offering marks the seventh time in four years that Netflix is raising $1 billion or more through debt. Netflix is amassing more debt to fund its ambitious growth plans. Prices on Netflix’s existing debt dropped across the board on Monday, with the biggest drops in a bond coming due in 2026, down by about 3 cents to 91.5 cents on the dollar. Netflix has had impressive growth since 2014. HF Markets - October 24, 2018.
“Netflix may issue new junk bonds for several more years as proceeds from debt sales fuel not only free-cash-flow deficits, but also repayment of bond principal. Netflix (NFLX) Simulator Simulator ... Everything You Need to Know About Junk Bonds. Netflix is launching a new $2 billion debt offering to fund its cash-burning content business. Netflix Inc. is once again turning to the junk-bond market to fund new programming as the streaming-video giant seeks to maintain its torrid subscriber growth. With that latest debt deal, its long-term debt will climb to around $12.5 billion. By. Shares dropped 1.26% on the news.
report, Bloomberg Intelligence analyst Stephen Flynn said the upgrade may give Netflix the support to sell $2 billion of bonds to boost liquidity and pay for rising programming costs. About 12 of the 14 billion dollars of Netflix debt is made of junk bonds. The streaming giant last raised $2.2 billion in junk bonds in April 2019.
What Is a Junk Bond? Netflix and Delta Are the Latest Companies to Sell High-Yield Bonds.
It will need to double that in order to pay its first round of bonds starting in 2027. Borrowers of all types have been able to tap high-yield bond markets this week. FORTUNE may receive compensation for some links to products and services on this website. FACEBOOK TWITTER LINKEDIN By Investopedia Staff.
To raise the money to pay for all that content, the company turned to junk bonds.
The Netflix Junk Bonds. The Netflix Inc.-Bond has a maturity date of 2/15/2025 and offers a coupon of 5.8750%. Offers may be subject to change without notice. The payment of the coupon will take place 2,0 times per biannual on the 15.10.. Shares dropped 1.26% on the news. Netflix Snags Lowest Junk Bond Yields in Binge-Watching Frenzy - Bloomberg Netflix Inc. pulled in record subscribers after people hunkered down at home amid the virus pandemic. Netflix had to become a content producer to compete with other streaming services. Its yearly net income has gone from 266 million to 1.8 billion. Yesterday Netflix announced that it will return to the markets with a $2 bln junk bond offering. Junk bonds are bonds that carry a higher risk of default than most bonds issued by corporations and governments.
Updated Aug 17, 2019.