Netflix says to expect more price hikes in 2024 - What we know so far
In a letter to shareholders, Netflix said subscribers should prepare for more price hikes in 2024.
TheStreet's J.D. Durkin brings the latest business headlines from the floor of the New York Stock Exchange as markets open for trading Wednesday, January 24.
Full Video Transcript Below:
J.D. DURKIN: I’m J.D. Durkin - reporting from the New York Stock Exchange. Here’s what we’re watching on TheStreet today.
Stocks are reacting positively to Netflix’s fourth-quarter results … The streaming giant posted strong results with subscribers surging to an all-time high of 260 million last quarter. Netflix saw its stock pop nearly 10 percent on the report. Earnings will remain in focus when Tesla and IBM release results after the bell on Wednesday.
Sticking with Netflix - buried in its fourth-quarter letter to shareholders, the company let subscribers know it would be asking a little more from them in 2024. With the company saying, "As we invest in and improve Netflix, we’ll occasionally ask our members to pay a little extra to reflect those improvements, which in turn helps drive the positive flywheel of additional investment to further improve and grow our service."
One reason for the price hike could be how much Netflix is paying to make new content. The company says it plans on spending $17 billion in 2024 to make new content for its catalog.
The company also announced it would be getting rid of its cheapest ad-free plan, which costs $11.99 per month. Despite the plan not being offered to new users, Netflix says it will also no longer offer the option in countries where ad-supported plans are available. The cheapest ad-free option remaining will now be $15.49.
The company added more than 13 million subscribers in Q4, beating Wall Street’s expectations. It was the best fourth quarter for Netflix to date - with its ad-tier subscriptions increasing by almost 70 percent from Q3. The streaming giant also beat revenue predictions with a 12.5 percent year-over-year jump.
That’ll do it for your daily briefing. From the New York Stock Exchange, I’m J.D. Durkin with TheStreet.
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