Netflix is raising another $2 billion in debt to fund content acquisition and production, among other general business needs, as it looks to maintain its subscriber lead with several marquee competitors entering the streaming market later this year.
The debt will be raised through unsecured notes, issued in both U.S. dollars and euros, the company said on Wednesday. The move comes after Netflix raised $2 billion in October and marks the fourth time in the last 18 months it has gone to the debt market.
The latest debt raise pushes Netflix’s overall debt obligation past $12 billion.
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“Netflix intends to use the net proceeds from this offering for general corporate purposes, which may include content acquisitions, production and development, capital expenditures, investments, working capital and potential acquisitions and strategic transactions,” the company said in its announcement.
The additional $2 billion in debt shouldn’t come as a surprise to investors after Netflix warned earlier this year it would “continue to finance our working capital needs through the high yield market.”
Last week, Netflix reported it added a company record 9.6 million new subscribers during the first quarter, putting the company on the verge of passing 150 million global customers. To keep those viewers streaming, Netflix is spending big on content, with about $15 billion going towards shows this year.
This comes as several formidable companies, including Apple and Disney, are about to launch their own streaming services by the end of 2019. Disney+, the Mouse House’s service, will cost $6.99 per month and will be the exclusive home to key franchises like Marvel and “Star Wars,” as well as its bevy of kid movies. WarnerMedia is also expected to launch its own streaming service by the end of year, spearheaded by HBO.
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Netflix, in its note to investors last week, said: “we don’t anticipate that these new entrants will materially affect our growth because the transition from linear to on-demand entertainment is so massive and because of the differing nature of our content offerings.”