Netflix’s password-sharing crackdown reels in subscribers as it raises prices for its premium plan
SAN FRANCISCO (AP) — Netflix on Wednesday disclosed summertime subscriber gains that surpassed industry analysts’ projections, signaling the video streaming service’s crackdown on password sharing is converting former freeloaders into paying customers.
In an effort to bring in even more revenue, Netflix also announced it’s raising the price for its most expensive streaming service by $2 to $23 per month in the US — a 10 per cent increase — and its lowest-priced, ad-free streaming plan to $12 — another $2 bump. The $15.50 per month price for Netflix’s most popular streaming option in the US will remain unchanged, as will a $7 monthly plan that includes intermittent commercials.
It also raised its prices for subscribers in the UK and France.
The company added nearly 8.8 million worldwide subscribers during the July-September period, more than tripling the number gained during the same time last year when Netflix was scrambling to recover from a downturn in customers during the first half last year. The increase left Netflix with about 247 million worldwide subscribers, well above the 243.8 million projected by analysts surveyed by FactSet Research.
Netflix’s financial performance also topped the analyst forecasts that shape investor expectations. The Los Gatos, California, company earned $1.68 billion, or $3.73 per share, a 20 per cent increase from the same time last year while revenue climbed 8 per cent to $8.54 billion.
The company’s stock price soared more than 12 per cent in extended trading after the latest quarterly numbers came out. Netflix shares have increased by about 30 per cent so far this year amid mounting evidence its video streaming service is faring better than most in a crowded fielded of competitors that is testing the financial limits of many households.
Netflix has picked up more than 16 million subscribers through the first nine months of the year, already eclipsing the 8.9 million subscribers that it added all of last year. But it’s still a fraction of the more than 36 million additional subscribers that Netflix attracted in 2020 when the pandemic turned into a gold mine for the service at a time when people were looking for ways to stay entertained while tethered to home.
