Netflix Is All-In on Developing a New Cloud Gaming Platform. What Does It Mean for the Stock?
Netflix (NASDAQ: NFLX) has become synonymous with subscription video-on-demand -- a notable feat for a company that started its life as a DVD-by-mail rental service. But now it is in the midst of another metamorphosis as it expands its video game creation and distribution arm.
Netflix recently revealed it was building a cloud gaming platform, promising to deliver its titles across an array of connected devices. With Netflix getting into the game streaming market, there is certainly lots for investors to be excited about. However, the nascent space is unproven, and one big-name tech company that attempted to make a go of such a service has already given up. With this in mind, does this effort mean that now would be a good time to pick up shares of Netflix, or is its video game adventure simply too much of a risk?
Netflix first moved into video streaming in November 2007, which also happened to be the first year that the company passed more than $1 billion in annual revenue. In 2022, Netflix's income topped $31.5 billion, underscoring the success of its streaming operation. However, unlike many of its major streaming video rivals, Netflix does not have a diverse business model. It has no TV or cable networks, no theme parks, and though it operates a handful of movie theaters, they typically showcase its streaming content.
Source Fool.com
