Netflix Number One Movie Hits The Mark With $230 Million Costs

Netflix’s ‘Back in Action’ cost more than $200 million to make

Netflix

Netflix has revealed that the cost of one of its biggest movies of 2025 surged by 11.8% to $231.7 million last year before it debuted at number one.

Netflix isn’t famous for being frugal. In March this year its chief financial officer Spencer Neumann boasted that it expects to spend around $18 billion in cash on content this year and that could increase in future.

This doesn’t mean its spending is unchecked. Far from it in fact as Netflix only has such strong cashflow to invest in content because it keeps a close eye on costs. This is crystal clear in the latest earnings release for one of its biggest movies of the year.

Called Back in Action, the comedy action flick stars Cameron Diaz and Jamie Foxx as a pair of married former CIA spies who are pulled back into espionage after their secret identities are exposed. Rounding out the A List cast is Glenn Close who plays an ex-MI6 sniper and the estranged mother of Diaz’s character. The fittingly-named film is the first movie role Diaz has had in 10 years and it comes from a bygone era.

Like the 1990s spy comedies that inspired it, the plot is clearly clichéd and that didn’t go down well with critics. They gave it a rating of only 30% on review aggregator Rotten Tomatoes and although audiences were more generous, they still only scored it 60%. If the movie had played in theaters that could have been the death knell.

Many theatergoers are picky about what they watch due to the high cost of a ticket. It means they tend research movies in advance which is why the Rotten Tomatoes ratings can be decisive. In contrast, Netflix subscribers pay a flat monthly fee so there’s no reason not to give a movie a shot. The hurdle is hearing about it in the first place but Back in Action had a trick up its sleeve to ensure that.

The movie’s glittering cast list drove media exposure of the movie contributing to it rocketing to the top of the Netflix global list of the most-watched English movies with 88.9 million hours of viewing in its opening week. It didn’t come cheap.

Although the movie is a globetrotting adventure, it was actually made at the historic Pinewood Studios in the United Kingdom which lifts the curtain on how much it cost.

Studios filming in the U.K. benefit from the government’s Audio-Visual Expenditure Credit (AVEC) which gives them a cash reimbursement of up to 25.5% of the money they spend in the country. It comes with a catch.

To qualify for the reimbursement, movies must pass a points test based on factors such as how many of the lead actors are from the U.K. and how much of the production work is done there. Furthermore, at least 10% of their core costs need to relate to activities in the U.K. and in order to demonstrate this to the government, studios set up a separate Film Production Company (FPC) there for each picture.

Each FPC has to file annual financial statements but it takes a bit of detective work to get to the bottom of them.

The FPCs usually have code names so that they don’t raise attention with fans when filing permits to film on location. Tallying the code names with the productions they are responsible for requires deep industry knowledge which my colleague and I have built up over nearly 15 years of reporting. We are the only journalists worldwide who specialize in covering the financial statements of U.K. film production companies for national media and we have reported on them for more than 10 leading titles including The Times of London, The Guardian, The Daily Telegraph, The Independent and the London Evening Standard.

Once the code names have been correctly tallied with the films, the financial statements of the relevant FPC can be consulted to reveal how much the movie cost to make. That’s because the terms of the reimbursement state that each FPC must be “responsible for pre-production, principal photography/shooting and post-production of the film; and for delivery of the completed film.” In short, the FPC’s financial statements have to show the production’s entire costs, not just those incurred in the U.K. Studios aren’t allowed to hide costs in other companies as the terms also state “there can only be one FPC in relation to a film.”

The Netflix subsidiary behind Back in Action is called Oasis Productions and, as with all U.K. companies, its financial statements are released in stages long after the period they relate to. This starts during pre-production and continues after the premiere to give the production team time to ensure that all the bills are paid.

It explains why it latest filings cover the period up to December 31, 2024, just over two weeks before the movie debuted. The company’s earnings report shows that a total of $231.7 million (£185 million) had been spent on the production by then which is far from bargain basement but isn’t gigantic either. Crucially, the spending hit the mark given the impressive performance of the picture.

It wasn’t lost on Netflix which stated in the earnings release that it “is satisfied with the company’s performance against budget.”

One of the biggest single expenses of Oasis Productions was the $13 million (£10.4 million) spent on staff which peaked at an annual average of 142 people. That doesn’t include freelancers, contractors and temporary workers as they aren’t listed as employees on the books of U.K. companies but often represent the majority of the crew on a film shoot. However, that’s not the end of the story as the government reimbursement had a magic touch on the picture’s bottom line.

The reimbursement is capped at 80% of core expenditure so in order to get back the maximum 25.5% of the money they spend in the U.K., production companies need to ensure that at least 20% of their core costs are spent outside the country. Netflix took full advantage of this as Back in Action was also shot in Slovenia and Atlanta.

The U.K. hasn’t just become a popular filming location because of the high level of its reimbursement but also because there is no limit to the amount that can be paid out. That’s not all.

In addition to claiming on direct spending in the U.K., studios can also get a pro rata reimbursement on what are known as neutral costs throughout the production such as insurance and payment to senior producers, writers and directors.

These costs can be claimed in proportion to the amount of the activity in the U.K. so, for example, if the spending there only represents 22% of the total budget then 22% of the neutral costs will also qualify for reimbursement. Accordingly, the level of reimbursement can rise close to a third of the total costs which is a staggering sum.

The earnings report for Oasis Productions shows that it had banked a total reimbursement of $49.7 million (£39.6 million) by the end of last year. This comes to 21.4% of the total costs and brings the net spending on the movie down to $182 million.

It casts a powerful spell on the U.K. economy. The latest data from the British Film Institute (BFI) shows that in 2019, every $1.31 (£1) of reimbursement handed to studios generated $10.88 (£8.30) of additional Gross Value Added (GVA) benefit for the U.K. economy. It led to a total of $10.1 billion (£7.7 billion) in GVA being generated by the fiscal incentives for film in 2019.

Netflix is one of the biggest contributors to it and invested almost $6 billion shooting shows and films in the U.K. between 2020 and 2023 alone. As long as they continue to be as popular as Back in Action it is money well spent.