×

Netflix Raises U.S. Subscription Prices for New and Existing Customers

Netflix has again raised the monthly price of its most popular streaming plan in the U.S., with the two-stream HD tier now $10.99 per month for new subscribers — while existing customers will be moved to the new rate over the next several months. That’s up $1 per month from the previous $9.99 monthly fee.

The company also increased the monthly fee for its four-stream “family plan,” from $11.99 to $13.99 per month. That “premium” tier also includes select content in Ultra HD 4K format.

Shares of Netflix hit a new all-time high on news of the price hikes, climbing more than 4% and peaking at $192.80 per share in Thursday morning trading.

Wall Street analysts have speculated that Netflix would ratchet up its pricing, as content costs continue to balloon. The company is spending around $6 billion on programming this year, projected to rise to $7 billion in 2017. Netflix says it expects to operate with negative free cash flow for several years, and has turned to debt markets to help fund content expenses.

“We believe that Netflix’s pricing power has increased materially over the past few years as their content slate and technology has improved,” RBC Capital Markets analyst Mark Mahaney wrote in a research note, adding that the price hikes will likely boost long-term revenue and earnings growth.

As for whether the higher prices will cause a flood of Netflix cancellations, RBC’s surveys indicate that the service’s content lineup — not price — is “the leading churn/churn-back factor amongst Netflix subs,” Mahaney added.

Netflix last raised prices in October 2015, when the two-stream plan increased from $7.99 to $9.99. It began rolling out the new pricing level to all subs starting in May 2016. As of the end of June, the company had about 52 million U.S. streaming members.

“From time to time, Netflix plans and pricing are adjusted as we add more exclusive TV shows and movies, introduce new product features and improve the overall Netflix experience to help members find something great to watch even faster,” the company said in a statement.

Pricing for Netflix’s single-stream “basic” non-HD plan remains unchanged, at $7.99 per month.

For new members, the higher pricing for Netflix’s top two plans went into effect Oct. 5. Starting Oct. 19, the company will begin notifying existing members about when their prices will increase; Netflix said it will notify users at least 30 days in advance, based on billing cycle, on when they will see the price change.

The price changes will roll out to U.S. members over the course of the next several months, according to Netflix.

Netflix’s slate of originals premiering in Q4 includes: Noah Baumbach film “The Meyerowitz Stories (New and Selected)” (Oct. 13); David Fincher-directed drama series “Mindhunter” (Oct. 13); “Stranger Things” season 2 (Oct. 27); “Alias Grace,” a series based on the Margaret Atwood novel (Nov. 3); “The Crown” season 2, starring Golden Globe-winner Claire Foy as Queen Elizabeth II (Dec. 8); and “Bright,” a cop action-thriller movie directed by David Ayer and starring Will Smith, Joel Edgerton and Noomi Rapace (Dec. 22).

Pictured above: Netflix’s “Stranger Things” season two.

Popular on Variety

More Digital

  • STRANGER THINGS

    'Stranger Things 3' Is Most-Watched Season to Date, Netflix Says

    The Upside Down delivered upside for Netflix in the third quarter: “Stranger Things” season 3 was the most-watched season of the series to date, according to the streamer. In the first four weeks of release, “Stranger Things” season 3 was watched by 64 million member households, Netflix said in the Q3 letter to shareholders. The [...]

  • Stranger Things Season 3

    Netflix Undershoots U.S. Subscriber Adds for Q3, Beats Profit Forecast

    Netflix fell slightly short of its U.S. subscriber forecast in the third quarter — and projected lower Q4 subscriber growth than Wall Street was expecting as competition looms from Apple and Disney. Still, the company reported solid gains, announcing a Q3 record for paid subscriber additions and revenue, and handily topped analyst forecasts for profit. [...]

  • Despacito Luis Fonsi Daddy Yankee

    'Despacito' Tops Vevo's Most-Watched Videos of the Past Decade Chart

    In celebration of its 10-year anniversary, Vevo today announced its Top 10 lists of the decade’s most-watched music videos. Not surprisingly, the Most-Watched Music Video accolade goes to Luis Fonsi’s “Despacito” (featuring Daddy Yankee), with 6.4 billion views since its release in early 2017. The second most-viewed video is Mark Ronson’s “Uptown Funk” (featuring Bruno [...]

  • Dead To Me

    Streaming Shows Nearly Doubled in Last Year, Boosting Los Angeles TV Production

    Television production in Los Angeles has received a major boost from streaming shows, according to a new report from the permitting organization FilmLA. The number of new digital projects nearly doubled between the 2017-18 and 2018-19 development cycles, increasing approximately 85.3% in a year. The number of digitally distributed original series in production has increased by [...]

  • Shonda Rhimes

    Shonda Rhimes Inks Podcast Deal With iHeartMedia

    Hit-making TV writer and producer Shonda Rhimes is jumping into the podcast game in a much bigger way. Rhimes’ Shondaland production company announced a three-year pact with iHeartMedia to launch Shondaland Audio, which will produce a slate of original podcasts to be released as part of the iHeartPodcast Network. Rhimes will oversee development and Sandie [...]

More From Our Brands

Access exclusive content