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Netflix raises prices after surge in subscribers
Netflix gained 19 million paid subscribers in the fourth quarter of the year - buoyed, it said, in part by the recent release of the second season of “Squid Game” and its push into live sports,
Netflix said Tuesday that it had raised subscription prices in the United States and some other markets, on the heels of its announcement that a surge of new subscribers saw it end 2024 with 302 million memberships.
In an earnings call, the company announced annual operating income for 2024 that exceeded $10 billion for the first time in its history, on the back of year-on-year revenue growth of 16 percent.
Netflix gained 19 million paid subscribers in the fourth quarter of the year – buoyed, it said, in part by the recent release of the second season of “Squid Game” and its push into live sports, including NFL games and the internet-viral boxing match between Mike Tyson and YouTuber-turned-boxer Jake Paul.
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The company said it had raised subscription prices across most plans in the United States, Canada, Portugal and Argentina. For U.S. users, Netflix’s ad-supported plan increased from $6.99 to $7.99 monthly, while a standard subscription has increased from $15.49 to $17.99. The platform’s premium ad-free plan – which allows four users to stream concurrently – went up by $2, to $24.99 per month.
“As we continue to invest in programming and deliver more value for our members, we will occasionally ask our members to pay a little more so that we can reinvest to further improve Netflix,” the company said in a letter to shareholders Tuesday.
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Netflix projected revenue of between $43.5 billion and $44.5 billion for 2025, equating to growth of about 12 to 14 percent year-over-year – a significant reversal in outlook from recent years, when some industry watchers forecasted decreasing stock values and as Netflix reported a decline in subscribers in 2022 for the first time in a decade.
As the market for streaming services has grown increasingly crowded, Netflix has sought to maintain its position by cracking down on password sharing, diversifying its products with a cheaper ad-supported plan and making a foray into mobile gaming.
“We have to continue to improve all aspects of Netflix – more series and films our members love, a great product experience, increased sophistication in our plans and pricing strategy (including more advertising capabilities) – and grow into new areas like live programming and games,” Netflix wrote in its recent letter to shareholders. “If we do that well, we believe we’ll have an increasingly valuable company.”
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