After initially declaring it was going to raise $1 billion in debt through the offering of senior notes, Netflix has added $500 million to the total.
On Tuesday the streaming service issued the notes in 2 offerings – $700 million and $800 million – with the notes reaching maturity in February 2022 and 2025, respectively.
In a press release, Netflix says it will use net proceeds for “general corporate purposes, which may include content acquisitions, capital expenditures, investments, working capital and potential acquisitions and strategic transactions.”
The move is in line with an aggressive global expansion outlined in a Jan. 20 Q4 letter to Netflix shareholders, in which CEO Reed Hastings and CFO David Wells stated their intention to raise debt in order to help cover a rise in spending on global content.
“Over the next few years we expect to continue financing our original content expansion with long-term debt,” the letter states. “We think long-term debt is the best way for Netflix to finance the production of content.”
“Last year our original content overall was some of our most efficient content,” Hastings and Wells noted. “Our originals cost us less money, relative to our viewing metrics, than most of our licensed content, much of which is well known and created by the top studios.”
Netflix says it intends to launch 320 hours of original programming, “triple the amount of original programming Netflix released in 2014.”
The sale of the debt is expected to close Feb. 5, subject to the usual closing conditions.