- Amazon’s Prime feature will see a price increase starting February 18
- Increase in expenses stated as a reason for the price increase
- Amazon announces last quarter it added more revenue year-over-year than in any other quarter in its history
Amazon marks a significant increase in users over the past few months, resulting in an increase in the price of its Prime subscription.
Amazon Increases Prices for Prime
While many businesses, big and small, have sustained negative effects over the past two years of the global pandemic state, this does not seem to be the case for Amazon. The company’s workforce has doubled over the past two years, to 1.6 million employees. Amazon even said last year it had increased the wages of a third of its employees.
With the background of this financial growth, Amazon announced it will increase the price of Prime membership. The annual price of a Prime membership will rise from $119 to $139, and the monthly price will go up from $12.99 to $14.99. This change will take effect for new accounts on February 18. People, who are already subscribed, will see the price change after their first renewal following March 25. This represents a 17% increase.
This move comes after the prices for many products, from food to energy, have been increasing over the past few months. The last time Amazon raised prizes for its membership was in 2018 when it bumped the annual membership up from $99.
Amazon Marks a Large Increase in Income
The Amazon-owned Twitch service will naturally be affected by the price increase. Prime Gaming, which grants users bonus exclusive content, will also see changes, ?s the service is linked to the Amazon Prime membership.
Interestingly enough, according to the company’s latest quarterly earnings report, it has posted operating losses, but Amazon Web Services, the corporation’s North America and international e-commerce business, its biggest profit driver, scored a 49% increase in income. This branch of the Amazon family also gained more revenue year-over-year than in any other quarter in its history, marking a $5.9 billion increase over the past three months.
Amazon’s reason behind the price increase is its recent $1 billion deal to stream Thursday Night Football. The corporation has broadened its portfolio of streamable content, which now includes The Wheel of Time, Lord of the Rings: Rings of Power, and the latest season of The Boys.
Another reason for Amazon to increase its pricing is its same-day delivery feature, pharmacy delivery, and music division all saw increased usage, therefore increased expenses.
According to IGN, more than 200 million users have streamed its available shows and movies from its video library. This generated over $147 billion in net sales, resulting in $14.3 billion in net income, cementing Amazon’s place as one of the most profitable streaming companies worldwide.