Streaming video service company Netflix Inc. raised the monthly fees of its standard and premium subscription plans in the United States on Thursday, a move that caused the company’s stock to rise by nearly 5%.
Netflix increases its standard subscription fee by $1 per month to $14, while the price of the premium package increases by $2 per month to $18. The company’s most popular standard package can enable two video streams at the same time, while the premium package can support four video streams at the same time.
Since January 2019, US customers have raised prices for the first time.
In the afternoon trading on the Nasdaq, Netflix’s stock price rose 4.8% to $509.53.
Netflix is the world’s leading streaming service, and subscriptions surged at the beginning of this year as viewers around the world were told to stay at home to help fight the coronavirus pandemic. The company expects that by the end of 2020, there will be 200 million streaming media users worldwide, of which 73 million will come from the United States and Canada.
It also faces a growing number of competitors, including Walt Disney’s Disney+, AT&T’s HBO Max and Apple’s Apple TV+.
After the company released its earnings report last week, chief operating officer Greg Peters said that the company saw an opportunity to increase prices in “countries where we have provided additional value.”
A Netflix spokesperson said Thursday that the company is raising prices “so that we can continue to offer a wider variety of TV shows and movies in addition to continuing to provide an outstanding fall lineup.”
Netflix’s basic plan (allowing only one video stream at a time) is still priced at $8 per month in the United States.