Netflix is once again adjusting its pricing strategy, this time on the heels of a robust third quarter. The streaming behemoth has announced price increases for its ad-free Basic and Premium plans in the U.S., U.K., and France.
Details on the New Pricing Structure
The Basic plan will now cost $11.99, up from $9.99, while the Premium plan will set you back $22.99, a $3 increase from its previous $19.99 price tag. However, the ad-supported $6.99 plan and the $15.49 Standard plan will remain unchanged.
Subscriber Growth and Password Sharing
This move comes after Netflix reported a 9% year-over-year increase in average paid memberships, adding 8.8 million subscribers in the last quarter alone.
The company now boasts a global subscriber base of 247 million. One factor contributing to this growth is Netflix’s crackdown on password sharing, which has led to more users converting into full-paying subscribers.
Industry Trends and Competition
The price hike is part of a broader trend in the streaming industry, as competitors like Disney+ and Hulu have also announced price increases in recent months.
Netflix’s decision to raise prices is not entirely surprising; the company had hinted at this possibility earlier, citing the need to deliver more value to its members.
Financial Performance in Q3
Financially, Netflix is on solid ground. The company reported Q3 revenue of $8.54 billion, exceeding expectations and marking an increase from $7.9 billion in the same quarter last year. Earnings per share for the quarter came in at $3.73, and the company’s stock jumped by 12% in after-hours trading.
Diversification and Future Plans
In addition to its core streaming business, Netflix is diversifying its offerings. Co-CEOs Ted Sarandos and Greg Peters emphasized the company’s investments in new areas like gaming and sports content to attract more subscribers. Netflix is also planning to roll out new features for its ad-supported tier, including the ability to download content starting next month.