Here's why Netflix could raise prices again — soon

• New survey data from Evercore suggests Netflix has room to raise prices in the US.
• The percentage of US subscribers who said they'd cancel in response to a price hike is well down.
• Almost half indicated more live content like the Paul-Tyson fight could keep them from canceling.

Netflix's subscriber gains from its password-sharing crackdown could be waning, and some on Wall Street think it'll raise prices soon to keep its growth going.

New survey data from Evercore ISI just added fuel to the theory. Its quarterly survey of Netflix subscribers, published December 1, showed that Netflix is in a strong position in the US based on market penetration, satisfaction, and likelihood of canceling. Citibank analysts also recently wrote that Netflix could raise US prices by 12% in 2025.

In Evercore's survey, price sensitivity among US Netflix subscribers was lower than it had been in four years, which should make it easier for the streamer to push through price increases. When asked how they'd respond to a $1 a month price hike, 26% of 1,300 US respondents said they'd be highly likely to cancel, down from 45% who said so in August.

Consumers often overstate their willingness to cancel services in response to price increases, so those absolute numbers should be taken with a big grain of salt. Netflix has consistently had a lower cancellation rate than the other major streamers, even as it's raised prices over the years, according to the data firm Antenna.

When it came to penetration, Netflix continued to dominate, with 58% saying they watched the service in the past 12 months, up 1% from the previous quarter and ahead of Amazon's Prime Video (54%) and Disney's Hulu (44%).

A third factor, satisfaction, was the highest it had been since the third quarter of 2020, with 63% of those surveyed by Evercore saying they were "extremely/very satisfied" with the service.

In addition to a hit-filled third quarter ("The Perfect Couple," "Monsters: The Erik and Lyle Menendez Story," and more), Netflix has benefited from buzzy live events like the Jake Paul-Mike Tyson fight. Netflix's lower-priced ad tier has also increasingly kept people from canceling while giving the streamer cover to raise prices on its pricier, ad-free tiers. Live Christmas NFL games this month and WWE "Raw" starting in 2025 will likely drive more momentum, with 47% of those surveyed saying they would be more likely to keep Netflix if more live content were added.

Netflix has been raising prices roughly once a year, though unevenly among its various tiers. It's been over a year since the last increase, in October 2023, when Netflix raised the price of its Premium plan by $3 to $22.99 a month and upped the cost of its now-defunct Basic plan. The last time Netflix raised prices on its Standard ad-free plan was January 2022, when it raised it by $1.50 to $15.49.

When asked about price increases on Netflix's third-quarter earnings call in October, co-CEO Greg Peters said he saw a "tremendous amount of potential" if Netflix kept improving its TV and film offerings and expanded into new areas like live events. The company recently raised prices in Europe and Japan and said the results met expectations.

"Our approach towards pricing, it's been remarkably consistent over many, many years," Peters said on the call. "And our core theory is we've got to work really, really hard to make sure that we are delivering more value to members every quarter and then we sort of assess, based on how that's going, metrics like engagement, like acquisition, retention, did we do a good job there? How do we actually deliver on that promise of more value? And when we do, then we occasionally ask members to pay a bit more so we can invest that forward and keep that whole process going."