You are using an older browser version. Please use a supported version for the best MSN experience.

Netflix's growth slows as its delayed price hike sets in

Engadget Engadget 18/07/2016 Richard Lawler
© Provided by Engadget

Our first real peek at the reaction to Netflix's "ungrandfathered" pricing is here, as it releases numbers for the second quarter. What they show is much slower subscriber growth compared to the last couple of years, failing to meet the company's own projections both in the US and around the world. Netflix predicted it would grow by 2.5 million customers in the quarter (500,000 in the US, 2 million internationally) and ended up adding a net 1.68 million customers, up only 160,000 in the US. In a letter to shareholders (PDF), execs noted media coverage of the delayed price hikes was "coincident" with customers leaving, but said the new prices "will provide us with more revenue to invest in our content to satisfy members."

In case you've forgotten how it worked, Netflix actually raised prices twice, in 2014 and 2015, but delayed their impact for existing subscribers until this summer. Now, those delays are wearing off and customers are slowly being notified that their subscription is going up from $8 or $9 per month (for an HD subscription) to $10 per month for the standard package ($8 for SD, $12 for 4K / four simultaneous stream).


Netflix Q2 2016 Earnings (PDF)

More from Engadget

image beaconimage beaconimage beacon