Netflix announced higher prices for its streaming service and its stock price promptly jumped in mid-day trading Thursday.
Netflix’s prices are rising to $13.99 from $11.99 a month for its premium tier, its standard plan rises to $10.99 from $9.99. Its basic plan stays at $7.99. The new price structure goes into effect in November.
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After the news came out, Netflix stock rose to $191.83 a share, up more than 4%.
The company increased prices last year. That price increase had Wall Street worried whether the company would be able to continue its rapid subscriber growth.
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"Though it may have caused some churn at the time, it was hard to say how much of that was actually due to the price increase or the amount of conversation in the media around the price increase, which brought an undue amount of user attention to it,” said analyst Mark Mahaney of RBC Capital Markets. “Plus, it’s likely that a large number of users who churned off have since returned, as we’ve seen a very strong 1H17 in terms of domestic sub adds.”
Read more at broadcastingcable.com.
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