Netflix, a leading streaming platform, has implemented subscription price increases for select plans in the United States, Britain, and France.
The company witnessed a substantial surge, gaining nearly 9 million new customers worldwide, crediting the growth to their intensified efforts to combat password-sharing and a continuous influx of engaging content like the global sensation “One Piece.”
In the United States, Netflix raised the price of its premium ad-free plan by $3 per month, now priced at $22.99, while the one-stream basic plan saw a $2 per month increase. These price adjustments come as Netflix explores revenue generation avenues, especially considering the nearing market saturation in the United States and growing competition from major players like Walt Disney, Warner Bros, Discovery, and others.
In the UK, the basic plan price increased by 1 pound to 7.99 pounds, and in France, the basic plan saw a 2 Euro increase, now priced at 10.99 Euros.
The price hikes were announced within the context of a third-quarter earnings report, revealing that Netflix’s global subscriber base had reached an impressive 247 million by the end of September.
Netflix has reported revenue of $8.542 billion in the third quarter. Revenue growth in Q3 reflected a 9 percent year-over-year increase in average paid memberships (8.8 million paid net additions vs. 2.4 million in Q3’22) due to the roll out of paid sharing, strong, steady programming and the ongoing expansion of streaming globally.
For the fourth quarter, Netflix projected revenue to reach $8.69 billion, up 11 percent.
Netflix projected that its operating margin would increase approximately two percentage points from 18 percent operating margin in FY22.
While the streaming industry witnesses unprecedented growth, media companies like Netflix have also faced challenges, including labor tensions in Hollywood. The ongoing strikes have impacted productions like “Stranger Things.” Netflix, however, noted that it has managed the strikes relatively well compared to competitors due to a significant portion of its productions taking place outside the United States.
In response to the strikes, Netflix adjusted its content spending projections, estimating an investment of approximately $13 billion on content for 2023, assuming a resolution with the striking actors in the near future.
Despite the challenges, Netflix highlighted its continued dominance in viewership, with its programming accounting for 8 percent of television screen time, second only to Google YouTube’s 9 percent, as per Nielsen data. Amazon’s PrimeVideo has 3.6 percent share.
