Netflix raises price in Singapore as analysts remain neutral on counter

[SINGAPORE] Netflix has raised its subscription prices in Singapore by S$2 to S$4, even as analysts remain neutral on the counter.

The prices of the three subscription plans will go from S$13.98 to S$15.98 for the basic subscription, from S$19.98 to S$22.98 for the standard subscription and from S$25.98 to S$29.98 for the premium subscription.

This price hike follows increases in large markets that have performed in line with expectations, said the company in its Q1 2025 results release on Apr 17.

“As we deliver more value to members, we refine our plans and pricing to improve monetisation to drive investment in future service improvements,” said the streaming service.

Q1 revenue in Asia Pacific grew 25 per cent year on year to US$1.3 billion from US$1billion. The region is the lowest revenue contributor for Netflix, as the US and Canada tops the list at US$4.6 billion, up from US$4.2 billion in Q1 2024.

Amid the current uncertain and challenging macroeconomic environment, Netflix’s price changes will be led by subscribers rather than a predetermined plan.

“As we stated before, we really rely on our members to let us know when we’ve invested enough, grown the value in our offering, and then determine based on that when we adjust pricing to be able to reinvest back into our service,” said Netflix co-CEO Gregory Peters in the Q1 earnings call.

Netflix has yet to launch ads in Asia Pacific, which is slated for Q2. With ads, there will be lower-priced plans, which will improve monetisation for the streaming service.

“We’ve also been expanding that range of price points, including a low-priced ads plan in our ads market, which better allows us to offer the right plan at the right price to a wider range of consumers,” said Peters.

The streaming service’s Q1 net income grew 21.7 per cent year on year to US$2.8 billion from US$2.3 billion. Revenue was up 13 per cent at US$10.5 billion from US$9.4 billion.

Netflix is guiding for Q2 revenue of US$11 billion and net income to be US$3.1 billion. The 2025 revenue forecast remains unchanged at US$43.5 billion to US$44.5 billion, with an operating margin of 29 per cent.

Some positives amid market volatility

Revenue for Q1 was in line with consensus, and operating income and earnings per share exceeded street estimates, noted Citi analyst Jason Bazinet. However, this was not enough to sway a change in call from “neutral”, with an unchanged target price of US$1,020.

Downside risks include difficulty in raising subscription prices, more intense competition from other streaming providers and content costs escalating beyond expectations, said Bazinet.

On the upside, Netflix could grow its ad-tier offering ahead of expectations, while the crackdown on password sharing may result in more subscribers than expected, and there are potentially higher returns from content spending.

PhillipCapital, however, upgraded Netflix from a “reduce” to “neutral” call, with a target price of US$950 – citing resilience during recessions as consumers view it as a low-cost entertainment alternative. This is coupled with minimal impact from market volatility with strong retention and engagement, said analyst Helena Wang.

Netflix’s ability to raise prices in early 2025 without impacting retention – despite a market downturn – highlighted its strong pricing power, noted Wang. The addition of major live events such as the Taylor-Serrano Fight and NFL Christmas game could result in further price hikes amid market volatility.

The ad business also remains attractive, with ad revenue expected to double in FY2025.

“Netflix remains resilient with limited tariff exposure and strong earnings growth backed by an optimistic FY25 outlook,” said Wang.