Feeds

Netflix raises $400m to steady its global expansion

Movie rental firm taps investors for extra cash as it moves into Europe

Providing a secure and efficient Helpdesk

Video rental firm Netflix, soon to be hitting the UK shores, has raised $400m in fresh capital from long-time investors to try to boost the firm after a tough few months.

The US company has dropped nearly 75 per cent of its market value since July, when it announced an ill-fated plan to split its DVD and streaming services and hike its prices while it was at it.

After a couple of months of withering criticism from the media and haemorrhaging subscribers, Netflix realised the error of its ways and dumped the whole Qwikster-DVD-spinoff idea for good, but the damage was done on the markets.

In a letter to shareholders outlining its third quarter results in October, the movie rentals firm said it had lost subscribers as a result of the moves, as well as damaging "our hard-earned reputation".

Netflix is now trying to get its feet planted firmly back on the ground as it takes on Lovefilm in the UK early next year, starting with a streaming-only service.

The firm grabbed the additional funds it needs from existing investors, signing a deal for $200m worth of convertible notes with Technology Crossover Ventures and affiliates.

That contract was dependent on Netflix managing to convince another investor to give it an additional $200m for stocks, according to an SEC filing, which it did in a deal with T Rowe Price Associates and affiliates.

"With this additional capital from two long-term oriented investors, we have strengthened our balance sheet and remain focused on growing our streaming subscriptions and returning to global profitability after our launch in the UK in 2012," David Wells, CFO, said in a canned statement. ®

Beginner's guide to SSL certificates

More from The Register

next story
Scrapping the Human Rights Act: What about privacy and freedom of expression?
Justice minister's attack to destroy ability to challenge state
WHY did Sunday Mirror stoop to slurping selfies for smut sting?
Tabloid splashes, MP resigns - but there's a BIG copyright issue here
Hey Brit taxpayers. You just spent £4m on Central London ‘innovation playground’
Catapult me a Mojito, I feel an Digital Innovation coming on
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
EU to accuse Ireland of giving Apple an overly peachy tax deal – report
Probe expected to say single-digit rate was unlawful
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
EU probes Google’s Android omerta again: Talk now, or else
Spill those Android secrets, or we’ll fine you
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.