Last Tuesday, Netflix released its Q4 2020 earnings results. Most of the analyst coverage since the earnings call has focused on its reaching 200MM subscribers, and its promise of positive free cash flow in 2021.
But little, if any, coverage has focused on the significance of this paragraph in its Letter to Shareholders:
We continue to ramp up our local original content slate. Our top local titles this quarter include Barbarians (a historical action series from Germany that 37m member households globally chose to watch in the first four weeks), Sweet Home, our Korean language horror show (22m member households), Selena: The Series, which particularly resonated with members throughout Mexico and the US (25m member households globally), and Alice in Borderland, a sci-fi thriller from Japan (18m member households). While designed to be very impactful in the home country, we see many cases of our local originals traveling more broadly. For example, Lupin, an adrenalin-filled French language heist series released in early January, has hit #2 in our US Top 10 list and ranked #1 in dozens of other countries including Brazil, Argentina, Germany, Italy, Spain, Poland, Vietnam, the Philippines and many more. We project 70m member households will choose to watch Lupin in its first 28 days of release.
These four sentences succinctly summarize, if not undersell, an extraordinary development: Q4 2020, and specifically Lupin, marks a turning point not just for Netflix’s model, but for Hollywood’s future, too.