Netflix raises subscription prices again
Upon disclosing the financial results for the third quarter of 2023, Netflix revealed an impending escalation in subscription fees, encompassing the United States, the United Kingdom, and European markets. Both the basic and premium subscription tiers are poised to witness a nominal uptick. However, the ad-supported and standard plans will retain their current pricing structures.
At present, Netflix has not realigned its subscription pricing in the Asian territories but anticipates imminent adjustments reflecting market dynamics.
In this revision, the American basic subscription surges from $9.99 monthly to $11.99, with the premium variant escalating from $19.99 to $22.99. Prices for ad-supported basic and standard plans remain unchanged at $6.99 and $15.49, respectively.
For the UK and Europe, while the ad-backed basic and standard plans retain their pricing, adjustments primarily target the basic and premium subscriptions. In the UK, the basic subscription will be priced at £7.99 per month and the premium at £17.99. The ad-supported basic and standard versions persist at £4.99 and £10.99 respectively. In Europe, the basic subscription will shift to €10.99, with the premium adjusted to €19.99, while the ad-supported versions remain at €5.99 and €13.49.
Netflix emphasizes its competitive edge in pricing compared to rival streaming services. The company justified the fee recalibration, citing increased content production expenses.
Within the released financial report, Netflix’s profit soared to $8.552 billion, marking a 7.8% growth year-over-year. Revenue amounted to $1.916 billion, and net profit settled at $1.677 billion. Post endeavors to curtail prevalent account sharing and entice users with budget-friendly options for additional paid accounts, Netflix’s global paid subscribers burgeoned to 247.15 million, signifying a 10.8% year-over-year spike and an incremental 8.76 million from the preceding quarter.
As projections for the fourth quarter materialize, Netflix forecasts profits reaching $8.692 billion, representing a 10.7% growth year-over-year. However, a potential revenue decline to $1.16 billion and a net profit reduction to $0.956 billion are anticipated, possibly correlating with amplified end-of-year expenses. The growth trajectory for paid subscribers is likely akin to the third quarter’s.
Furthermore, citing Nielsen’s market research, Netflix highlighted the current content consumption trend heavily favoring streaming at approximately 37.5%. Conventional broadcasting and cable programming constitute 23% and 29.8%, respectively, with other formats occupying about 9.6%. Among all streaming platforms, Netflix commands a 7.8% market share, with YouTube reigning supreme at approximately 9%. Other streaming services cumulatively occupy 5%, whereas Amazon’s Prime Video and Hulu both have a 3.6% share. Disney’s flagship service, Disney+, lags behind with a mere 1.9% stake.
