Netflix is raising subscription prices across key markets, including the United States, Canada, Portugal, and Argentina, in a move that reflects its regained dominance in the streaming industry.
The price increases affect its three primary plans: the ad-supported tier rises from $6.99 to $7.99 per month, the standard ad-free plan jumps from $15.49 to $17.99, and the premium tier climbs from $22.99 to $24.99. Subscribers will see the new charges in their next billing cycles.
While higher prices may seem risky, Netflix’s latest earnings report underscores its growing strength. The company added 19 million subscribers over the past few months—the most in a single quarter in its history—bringing its global subscriber count to an unprecedented 300 million. This combination of a rising subscriber base and increased subscription fees suggests Netflix has successfully overcome the hurdles that once cast doubt on its long-term prospects.
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A Difficult Road to Recovery
In early 2022, Netflix reported its first subscriber loss in a decade, sparking widespread concern about the company’s viability in an increasingly saturated and competitive streaming market. The news sent its stock plummeting, wiping out over $50 billion in market value in a single day.
The subscriber decline was attributed to several factors including:
- Increased competition from emerging platforms like Disney+, HBO Max, and Amazon Prime Video.
- Account sharing, which Netflix estimated was occurring in over 100 million households globally.
- Content fatigue among users, with some questioning whether Netflix’s vast library offered enough fresh, high-quality programming.
The financial strain forced Netflix to implement drastic cost-cutting measures. In mid-2022, the company laid off approximately 450 employees across multiple departments. These job cuts, while painful, were part of a broader strategy to reduce expenses and refocus its business on sustainable growth.
Netflix also pivoted to new revenue streams, launching an ad-supported tier in November 2022 to attract budget-conscious subscribers. Despite initial skepticism, the ad-supported tier gained traction, providing an entry point for millions of new users. The company’s crackdown on password sharing, which began in 2023, also helped boost revenue by encouraging users to pay for additional accounts.
Indicators of a Turnaround
The resurgence in Netflix’s subscriber base and financial performance highlights the success of these strategies. In 2024, the company reported its first-ever operating income exceeding $10 billion. Netflix executives believe the platform has only scratched the surface of its growth potential, pointing out that streaming still accounts for less than 10% of total TV viewing in many countries.
The introduction of the “Extra Member with Ads” plan, which allows ad-supported subscribers to add someone outside their household for $7.99 per month, is another sign of Netflix’s innovative approach to monetizing its audience.
Content and Live Programming as Key Drivers
A critical component of Netflix’s recovery has been its ability to produce compelling, globally popular content. The end of 2024 saw the release of new seasons of Squid Game and Arcane, both of which drew massive viewership. Netflix has also been experimenting with live content, an area it once avoided.
Recent successes include a live boxing match between Mike Tyson and Jake Paul, which garnered record-breaking viewership, and its WWE Monday Night Raw debut, which attracted 4.9 million viewers. While Netflix has clarified that it is not aiming to acquire rights for regular-season sports, its strategy of delivering exclusive “can’t-miss” live events is paying dividends.
Netflix is raising prices again, after seeing a record quarterly surge in subscribers. Its monthly ad-based plan will hit $7.99, with premium subscriptions at $24.99. The increase comes as Netflix ups its annual content spend to $18 billion. It remains cheaper on a per-hour basis than its rivals, however, says UBS. With advertising revenue barely making a dent and surging demand boosted by live sports programming, it may well retain its pricing power, the FT suggests.