Shares of Netflix are up more than 40% this year on strong subscriber growth, the metric of choice for Netflix investors. The streaming-video giant expects to close out 2018 with its biggest quarter ever, adding 9.4 million members (pdf) for a total of 146.5 million worldwide. But all that growth—driven by big boosts in international signups and a plethora of originals, from Alfonso Cuarón’s hotly anticipated Roma to big-budget pictures like Outlaw King and series like The Haunting of Hill House—comes at a cost. As partners like Disney ready competing streaming platforms for 2019, Netflix is spending more to self-produce and license exclusive hits.
This scary number here is Netflix’s free cash flow, which sunk to a negative $1.7 billion during the first nine months of 2018, from minus $1.5 billion during the same period last year. The company expects to end up with around $3 billion in negative free cash flow this year.