I'm LongbridgeAI, I can summarize articles.Netflix raised U.K. prices across all plans, with the ad-supported tier increasing by a third. Despite a 5.4% stock drop, historical data shows Netflix has never experienced a year of revenue decline following price hikes since its inception. While growth rates may fluctuate, top-line revenue consistently expands. The company aims to double ad revenue, and early U.S. results suggest the latest increases are proceeding as expected, though overall engagement remains flat.
Netflix (NFLX -5.35%) raised prices on every one of its U.K. plans in the past few days. The ad-supported standard plan took the biggest jump, moving from £5.99 to £7.99 a month (a third more), while the ad-free standard plan went to £13.99 and premium to £20.99. New members pay the new prices right away, and existing members typically get 30 days' notice before the change reaches their bills.
Shares of the streaming giant fell 5.4% on Friday to $78.25, the same day the increase made headlines.
Price increases are nothing new for this company, though. Netflix has been raising prices for 15 years, in markets all over the world, and its annual revenue has grown every single year through all of them.
But that streak is a low bar. The better measure, I'd argue, is what each increase did to the company's revenue growth rate -- and that record is more interesting than the streak itself.
Image source: Netflix.
The increases are coming faster
Netflix last raised U.K. prices in February 2025, when the ad-supported plan went from £4.99 to £5.99 a month. That makes this the second U.K. increase in about 19 months, and it leaves the ad tier costing 60% more than it did at the start of last year.
Netflix raised U.S. prices in March too, its second increase there in about 14 months, taking the standard plan from $17.99 to $19.99 a month.
Notably, the ad-supported tier (the plan built to catch price-sensitive members) is climbing fastest in both markets.
Revenue has grown through every increase
The worst increase Netflix ever made came in July 2011, when the company split its $9.99 streaming-plus-DVD plan into two $7.99 plans. Management acknowledged in its second-quarter 2011 shareholder letter that the change could be "as much as a 60% increase" for members who wanted to keep both services.
Hundreds of thousands of members canceled. Netflix ended the third quarter of 2011 with about 23.8 million U.S. subscribers, down about 805,000 in three months. And still, revenue rose 48% that year, and it grew another 13% in 2012.
The closest the streak has come to breaking was 2022. Netflix had raised U.S. prices that January, taking the standard plan from $13.99 to $15.49, and revenue for the year grew just 6.5% -- the company's slowest year of growth in at least a decade. A subscriber slump and a strong dollar contributed too. Even then, the top line grew. Growth stayed slow in 2023, then reaccelerated: revenue rose about 16% in both 2024 and 2025, reaching $45.2 billion last year, and 2025 opened with another round of U.S. price increases.
In short, no Netflix price increase has ever been followed by a down year of revenue. Where an increase can show up is in the growth rate, and even the clearest case took more than pricing to get there.
Will the ad tier change the pattern?
What's different this time is where the increase lands. Netflix's advertising business is its fastest-growing revenue line (ad revenue topped $1.5 billion in 2025, up more than 150%, and management is aiming to roughly double it this year), and that business depends on the ad-supported plan attracting members. Raising the plan's price by a third may test how much that audience is willing to pay.
The early evidence from the U.S. increase looks fine. In the shareholder letter accompanying its second-quarter results, Netflix said U.S. and Canada revenue grew 10% year over year, with what it described as only a partial quarter of impact from the March increase. The change, in management's words, "has gone well and as expected."
NASDAQ: NFLX
Key Data Points
The companywide trend deserves more caution. Second-quarter revenue growth was 13% year over year, and the forecast for the third quarter is 11.7% -- a decelerating path. Full-year revenue guidance sits at $51.0 billion to $51.4 billion, or 13% to 14% growth, down from nearly 16% in 2025.
Meanwhile, engagement is nearly flat, with members watching only 2% more hours in this year's first half than in last year's. In other words, more members, higher prices, and advertising are carrying the growth, not more hours watched.
Ultimately, I expect the streak to survive this increase too. That kind of pricing power, I think, is rare, and Netflix has proved it over and over.
But the stock's valuation arguably already gives the company credit for it. At about $78, the price-to-earnings ratio is about 20 measured against expected 2027 earnings, a level that arguably assumes the pricing power continues.