Critics say that Netflix (NASDAQ:NFLX) can't afford its rising costs in the long run. Even longtime Netflix fans and owners like Foolish veteran Rick Munarriz look for inventive ways to counterbalance its rising content licensing fees. But these skeptics are reading the company's margin trends exactly backward.

In this video, Fool contributor Anders Bylund explains how exploding margins in the streaming division are driving Netflix shares to new highs.

Fool contributor Anders Bylund owns shares of Netflix, but he holds no other position in any company mentioned. Check out Anders' bio and holdings or follow him on Twitter and Google+.

The Motley Fool owns shares of Netflix. Motley Fool newsletter services have recommended buying shares of Netflix. The Motley Fool has a disclosure policy.

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