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Netflix is raising some of its streaming plan prices on both sides of the Atlantic, as it hopes for a 10pc growth in revenue in Q4 this year.
Despite a turbulent six months for the entertainment industry owing to the Hollywood strikes, Netflix has managed to come out unscathed, according to its latest earnings report.
The streaming giant added 8.76m global subscribers during the third quarter of this year, beating Wall Street expectations and marking one of the highest quarterly jumps since the early days of the pandemic. The total number of Netflix paid subscribers now stands at 247.15m.
Helped by originals such as the third seasons of The Witcher and Top Boy as well as the fourth season of Sex Education, Netflix reported a quarterly revenue of more than $8.5bn, which represents a nearly 8pc year-on-year growth in sales after three quarters of low growth.
Adoption of the new Netflix ad-supported plan continues to grow, with membership up by almost 70pc over the previous quarter. The company said 30pc of sign-ups in countries where it is available is to the ad-supported plan.
“The last six months have been challenging for our industry, given the combined writers and actors strikes in the US,” Netflix wrote in its earnings report yesterday (18 October).
“While we have reached an agreement with the WAG [Writers Guild of America], negotiations with SAG-AFTRA [Screen Actors Guild-American Federation of Television and Radio Artists] are ongoing.
“We’re committed to resolving the remaining issues as quickly as possible so everyone can return to work making movies and TV shows that audiences will love.”
In the previous quarter, Netflix paid subscribers shot up by nearly 6m to 238.4m, far exceeding analysts’ expectations, even as its revenue and operating profit disappointed investors. This was an improvement however, over its record subscriber loss in the second quarter of last year.
Riding on the back of its latest promising growth, Netflix told subscribers in its earnings report that it expects quarterly revenue growth to hit 10.7pc in Q4, driven by the success of its password-sharing crackdown and the new ad-supported tier.
Keeping its ad-supported tier at $6.99 per month in the US, Netflix now plans to raise the price of its basic plan from $9.99 to $11.99 and its premium plan from $19.99 to $22.99. The price of its standard plan will remain unchanged at $15.49 per month.
The company said it is also making similar increases to its streaming prices in the UK and France.
“Our starting price is extremely competitive with other streamers and at $6.99 per month in the US, for example, it’s much less than the average price of a single movie ticket,” Netflix wrote.
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