(Telestock) – S&P Global Ratings has improved by two notches the rating Of Netflixan American company active in the streaming sector, “A” from “BBB+” with outlook “stable”.
The rating agency highlights that Netflix has outperformed forecasts in recent quarters and is generating percentage growth in revenues mid-teens and material margin expansion that reduced leverage to 1.1x from 1.6x at year-end 2022.
Additionally, Netflix updated its financial policy after announcing its first quarter results, supporting its view that the financial leverage will remain below 2x on a sustained basis.
The stable outlook reflects the expectation that Netflix will maintain its global leadership position in video streaming and generate revenue growth of 10%-15% over the next two years driven by its larger subscriber base and increased user monetization from its price increases and from the advertising leading to modest margin expansion. S&P expects leverage to remain around 1x in the absence of significant acquisitions.
(Photo: Thibault Penin on Unsplash)