How Does Netflix Compare with HBO?
Fri Jul 13 2018 15:00:00 GMT+0000 (Coordinated Universal Time)
For the first time ever, Netflix was nominated for more Emmy's than HBO. For perspective, and to realize just how big of a deal this is, just think about this: HBO has led all Emmy nominations for the past 17 years.
It's no secret that when it comes to TV programming, Netflix and HBO are the two heavyweights in the game. Cable continues to fade out like bleached clothes while streaming service are growing faster than we can keep up with. In fact, with HBO Now you can even catch all your favorite HBO content without needing a cable subscription. They're both similar -- offering original content and a helluva lot of TV shows and movies. That's no surprise. What may be a surprise is the numbers behind these companies and how they compare to each other. Let's take a look at how Netflix has been doing.
In 2017, Netflix had roughly $11.7 billion in revenue and $558.9 million in profit, with the company spending $6 billion on original content. Fast forward to 2018 and it's a whole new ball game. Netflix last year versus Netflix this year is like Michael Corleone in The Godfather compared to him in The Godfather II.
In the first 3 months of 2018, Netflix had a profit of $290 million and they're expected to announce Q2 profits of close to $360 million, bringing their profits for the first half of 2018 to $650 million. More than all of 2017. Sheesh!
Even with those impressive numbers and crazy growth, Netflix's profits start looking funny in the light when you put them side-by-side with HBO's. In the first 3 months of 2018, HBO made $535 million in profit. And it's not that HBO is just making that much more than Netflix (in fact, HBO only made $6.3 billion in 2017), they're just spending way less.
Netflix is betting on the long run and eventually wants 50% of the content on their platform to be original, so they're spending like your hood cousin during tax time. The company says it plans to spend $8 billion this year on original content. That's a lot of money, fam.
I'm not sure how Netflix is growing so fast considering it always seems like there's one person with an actual subscription while 20 other people use that account, but that's neither here nor there. It'll be interesting to see HBO's strategy going forward as Netflix eyes the long-run.