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NFLX » Topics » If we do not correctly anticipate our short- and long-term needs for DVD titles, our subscriber satisfaction and results of operations may be adversely affected.This excerpt taken from the NFLX 10-K filed Feb 28, 2007. If we do not correctly anticipate our short- and long-term needs for DVD titles, our subscriber satisfaction and results of operations may be adversely affected. If we do not acquire sufficient copies of DVDs, we may not satisfy subscriber demand, and our subscriber satisfaction and results of operations could be adversely affected. Conversely, if we attempt to mitigate this risk and acquire more copies than needed to satisfy our subscriber demand, our inventory utilization would become less effective and our gross margins would be adversely affected. Our ability to accurately predict subscriber demand as well as market factors such as exclusive distribution arrangements may impact our ability to acquire appropriate quantities of certain DVDs. |
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