The way Netflix is running its business leaves something to be desired, according to widely followed tech investor Gene Munster.
CNBC reports that soon after Netflix reported its first-quarter earnings, Munster told the cable channel that the streamer had a “good enough quarter,” but added: “It’s not a good business model.”
Munster commented during an appearance on CNBC’s “Fast Money.”
“He pointed to the fact that Netflix expects its 2019 free cash flow deficit to be negative $3.5 billion,” CNBC notes, quoting Munster, the founder of the venture capital firm Loup Ventures, saying: “At $10 a month they would have to add 30 million [subscribers].”
Munster added: “At the current run rate, that probably puts it toward the end of 2020 before they kind of alleviate that cash burn. Now they can do some things in terms of making some of the content costs a little bit more efficient. But I think that in general more competition is not good for that.”