Netflix raised prices and the stock soared

  • The rate hikes constitute a jump of between 13 and 18 percent.
  • The new prices take effect immediately for new customers. Existing subscribers will be grandfathered in over the next three months.
  • Previous rate increases have had little effect on subscribers, and have traditionally buoyed the stock.

This is the first time since October 2017 that Netflix has raised prices for its US subscribers

Netflix Inc said on Tuesday it had raised prices for its U.S. subscribers by 13 percent to 18 percent, as the video streaming service spends heavily on original content and expands internationally.

Netflix raised the price on the standard plan, its most popular, to $12.99 per month from $10.99.

Its top-tier plan, which allows streaming on four screens in high definition, will be raised to $15.99 from $13.99 per month, while fee for its basic plan will rise to $8.99 from $7.99.

The price hikes will be applied to all existing members over the next few months and to all new members immediately, Netflix said in a statement.

This is the first time since October 2017 that Netflix has raised prices for its US subscribers.

Shares of Netflix, which is scheduled to report its fourth quarter earnings on Thursday, rose 5.5 percent to $351.21 in premarket trading.

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