Earlier this week The Diffusion Group (TDG) released a consumer study indicating that 16% of Netflix subs are likely to either downgrade to a lower tier or cancel the service altogether if the price rose just $1 per month. Netflix execs will likely be asked during today's analyst call how much they expect the US price increase to boost subscriber churn rates. (See Netflix Raises Prices as Content Spending, OTT Competition Heat Up.) Netflix increased pricing in Canada and Argentina in Q4 2018, and in Japan in Q3 2018.
Netflix said it expects its new, higher pricing in the US - for new members today and to be phased in for existing members over Q1 and Q2 2019 - will lift its average selling price numbers, which rose 3% in Q4. Netflix shares were down $11.19 (3.17%) to $342.05 in after-hours trading Thursday. Netflix said Q4 revenues were $4.19 billion, short of the $4.21 billion that Wall Street expected. The company expects to add 8.9 million subs in Q1 2019 and end the period with 148.16 million. (Nasdaq: NFLX) guidance that it would add 7.6 million paid subs in the period. Q4 subscriber results, which were up 25.9% year-on-year, beat Netflix Inc. In the wake of plans to raise prices across the board in the US, Netflix said it added a record 8.84 million paid streaming subscribers – 1.5 million in the US and 7.3 million internationally - in Q4 2018, pushing its global total past 139 million.
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