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During the three-year period ended December 31, 2018, has Netflix depended upon leveraging debt as an...

During the three-year period ended December 31, 2018, has Netflix depended upon leveraging debt as an essential part of their growth strategy? Explain.

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During the three year period ended December 31, 2018 market conditions were favourable and the lending rates were lower. Thus Netflix focussed on debt fund rather than issuing own capital. There was a possibility of affording a high Debt Equity Ratio in such period as the interest rates on debt fund was low. This has saved Netflix from distributing excessive dividend on common stock as it has tried to maintained perfect or under capitalisation. It does not depends too much on own capital. Raising debt enables Netflix to make investment in diversified services to increase market share in the digital industry. A high stake was maintained with large investment in the business. This proves as an essential strategy for the company’s growth during the period.

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