Hot Picks: Netflix, Games Workshop, F1 drive entertainment growth

Netflix, Games Workshop and Formula One are highlighting how entertainment companies can deliver long-term growth through global expansion and deeply engaged audiences. Their business models are evolving to capture new revenue streams while maintaining strong customer loyalty.

BNN Bloomberg spoke with Markus Hansen, portfolio manager at Vontobel Asset Management, who outlined how these companies are leveraging international scale, advertising, intellectual property and live events to drive sustained growth with limited exposure to artificial intelligence disruption.

Key Takeaways

• Netflix is shifting toward margin growth through advertising-supported tiers while continuing to expand its global subscriber base.
• Games Workshop benefits from a loyal hobbyist community that drives recurring revenue through products, updates and licensing.
• Formula One generates growth through multiple revenue streams, including media rights, sponsorships and global race expansion.
• International markets are a key driver of revenue and subscriber growth across entertainment companies.
• Strong intellectual property and fan engagement support long-term, resilient business models.

Read the full transcript below:

ANDREW: Time for Hot Picks. We’re zeroing in on three names in entertainment. Our guest says these companies have loyal and growing customer bases. We’re joined by Markus Hansen, portfolio manager at Vontobel Asset Management. Thanks very much indeed for joining us. Start off with Netflix, obviously the name in streaming. Some analysts I know are cautious about the company’s ability to keep raising prices.

MARKUS: Absolutely. So Netflix is a great quality long-term compounder. Over the last six months, the stock and the headlines around the company were held up by discussions about a possible deal for the Warner Bros. studios and streaming assets. That’s now behind. They’ve moved on. We’re back to the fundamentals. And this is a story of a true global company. We think about it as a U.S. streamer, but really it is a global streamer. Of the 330-odd million subscribers, 70 per cent of those are outside of North America, and that’s where the subscriber growth is going forward.

And secondly, as you mentioned on pricing, they have a multi-tier pricing option now, which actually appeals more to the international side as well, in particular emerging markets where you need lower costs. Remember, this is related to the ad-supported tier. So you can get the streaming product at half the price, but it includes ads, and that’s very interesting because as a headline, you know, low price — is that an impact on margin? No. The ad-supported one has a higher margin, and in fact, their confidence in growing their ad revenues is quite substantial.

So we think this is back to a normal long-term story — a combination of subscriber growth, pricing power, and we’ve seen price increases come through, coupled with the ad-supported side, which is going to go from being a trivial amount of revenue to potentially about $10 billion out of a $60 billion base in the next few years. So quite powerful. Very strong balance sheet, the ability to invest in content, and engagement continues to be very strong. Churn is very low, very attractive. And the multiple is in the low 30s for a company that can compound earnings north of 20 per cent over the next decade.

ANDREW: So they can keep growing. I mean, I’ve heard one note of caution here, that as they expand into lower-income countries, they have to charge less.

MARKUS: So this is why the ad-supported offer is quite interesting. So right now, if you were to get regular Netflix with the recent price increases, you know, $19.99 — the ad-supported one is half that price. That pricing ability then is at a level which is interesting for those emerging markets where you can offer it.

And the ad-supported tier is very attractive, given the nature of how they can hone in on the eyeballs that are watching a particular show. It’s very powerful in terms of the advertisers they can bring to that. And right now, you really don’t notice it. It’s about five to 10 minutes of advertising in a regular one-hour show, compared to linear or other products out there. That’s still very attractive, gives you time to get up and grab a cup of tea. But then this margin side is very powerful, and this is why the company has emphasized less the story about subscribers. It’s really about a margin growth story, and we are talking about peak margins that continue to rise well north of 30 per cent.

ANDREW: We’re tight for time. Sorry, I could talk about Netflix all day. Games Workshop — it’s a British player in the video game market known for Warhammer.

MARKUS: Correct. Well, you talk about video games — so this is a 50-year-old company. This is more on the mid-cap side, quite interesting. It’s grown into a $9 billion market cap business, and their main product is a board game, but it’s really a hobby.

And the beauty of a hobby versus just a basic board game is that it’s something where the player has both an emotional connection and has invested dollars in it. They’re famous for their Warhammer 40,000, which basically involves playing a board game with miniatures which you put together and paint. This is a game of both strategy and luck.

It’s growing quite nicely. It’s been around for a while, as I mentioned, but really here, this is the move to go international. In the last few years, of the 500-odd stores the company operates and sells its products, more than 200 of those are now in the U.S., and they keep growing. But keep in mind, it reaches even further. About 6,000 hobby stores carry this game. So the ability for them to keep adding to that.

Then they’ve expanded from the board game itself — which is a combination of strategy and luck — into video games. And then there is the potential they could come out with a TV show related to the intellectual property around the game. We’ve seen that be very successful. That’s still to come. It’s one which I think is a long-term nice compounder.

And obviously, the names we’re talking about here really don’t have any plays either on AI or technology per se. They tend to be beneficiaries. And these are nice international, global companies to add to any portfolio.

ANDREW: That’s interesting. It’s not a video game company. It’s just physical.

MARKUS: They do some licensing for video games, but the bulk of the business — about 70 to 80 per cent of their earnings — comes from selling board games and merchandise that go with them. It’s a really very interesting story. I recommend going to look it up on the website to check it out. You might find a Warhammer store in your local town. Again, they continue to expand across North America and are becoming a global phenomenon.

ANDREW: That’s interesting, people getting together physically and playing a game.

MARKUS: Yeah, absolutely.

ANDREW: All right, just — we’re tight for time. Formula One. You see upside for this one?

MARKUS: Absolutely. Look, this is a unique sports franchise. Formula One has the operating licence to run the races, which is a global sport by any metric. It’s either the third- or fourth-most followed sport on the planet.

Really, we’re talking about monetizing in three ways. One is the number of races, which includes the number of automakers who are competing — we have the first U.S. team through Cadillac coming in this year. But really global in terms of its reach. Most of the revenues are outside the U.S., even though it’s listed in the U.S.

Secondly, you have the media rights, where they’ve teamed up with Apple and continue to expand those globally. And then the third part is sponsorship. If you and I had gone to an F1 race 20 years ago, most of the sponsorship was oil companies, cigarette companies or auto parts. Now it’s truly global companies, including luxury goods, beverage companies and technology firms.

All those drivers have incremental pricing power going forward. Obviously benefited from the recent Formula One movie. And then we do have the Miami race coming up this weekend, which is one of the key races that will spur further interest. And this is really a unique sports franchise which makes money and is compounding and growing over time.

ANDREW: Thank you very much indeed. I really appreciate it. Markus Hansen, portfolio manager at Vontobel Asset Management.

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This BNN Bloomberg summary and transcript of the April 21, 2026 interview with Markus Hansen are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.