Inflation isn’t just hitting consumer goods, it’s also hitting Netflix.
The Los Gatos, Calif.-based company has raised its monthly subscription prices by $1 to $2 a month in the US depending on the plan, in order to help it pay for programming costs, the company said.
Shares of the streaming giant jumped over 2 percent following the announcement Friday.
The monthly cost for the basic plan increased to $9.99 from $8.99, while the standard plan jumped to $15.49 from $13.99 and the premium plan rose to $19.99 from $17.99, according to Netflix’s website.
Netflix most recently raised prices for US customers in 2019 and 2020. Wall Street has been banking on Netflix to increase prices as new subscriber growth slows. The price hikes also reflect the company’s confidence that customers will not cancel the service due to a small price increase.
“We understand people have more entertainment choices than ever and we’re committed to delivering an even better experience for our members,” a Netflix spokesperson told Reuters. We’re updating our prices so that we can continue to offer a wide variety of quality entertainment options. As always we offer a range of plans so members can pick a price that works for their budget.”
The company said the new rates will apply to new subscribers immediately. Existing customers will receive an email about the price increases 30 days before they see it on their bills.