Here's 1 Critical Metric Bullish Netflix Investors Must Know
For most of the past decade, a valid concern that Netflix (NASDAQ: NFLX) naysayers pointed to was the possibility its business would never be able to generate free cash flow (FCF). This argument was supported by the fact the company spent billions of dollars every year licensing and producing content.
Well, amid what was a historically difficult year for Netflix in 2022, when the streaming juggernaut added only 8.9 million net new subscribers, it still proved the naysayers wrong. And now, the key metric Netflix bulls must pay attention to is free cash flow.
Netflix generated $1.6 billion of FCF in 2022, above management's internal estimate of $1 billion. And the leadership team expects the business to produce at least $3 billion of FCF this year. That is in stark contrast to most of the past decade, meaning Netflix has cleared the hurdle to transition from a perennial cash-losing enterprise to one that is on its way to becoming a cash cow.
Source Fool.com
