Customers Likely to Increase Spending on Netflix Following Price Increases, According to New Survey Results
In a recent survey conducted by Wall Street research firm TD Cowen, it was revealed that Netflix customers show a growing willingness to pay more for the service, coinciding with recent price hikes by Netflix in several regions. This willingness is contributing to an expected increase in average revenue per member for the company.
The survey, which polled a representative sample of 1,000 U.S. Netflix subscribers in May 2025, found that 54% of Netflix members would be willing to pay at least $1 more per month. Moreover, 70% of Netflix members would be willing to pay $2 more per month, while 40% would pay $3 more per month. However, it is important to note that the survey did not ask about the willingness to pay for the ad-supported tier specifically.
The survey results also showed that 46% of respondents would cancel their Netflix service if prices were raised at all. This suggests that while customers are willing to pay more, there is a limit to this willingness.
The trend of greater customer readiness to pay higher subscription fees aligns with Netflix's broader pricing strategies, such as adapting plans in price-sensitive markets like India, indicating flexibility in pricing to match customer willingness and market conditions.
TD Cowen's model predicts Netflix revenue growth at a compound annual growth rate (CAGR) of approximately 11% from 2025-30. Wall Street analysts on average anticipate Netflix posting Q2 revenue of $11.07 billion and earnings per share of $7.08.
TD Cowen maintains a "buy" rating on Netflix stock, with a 12-month price target of $1,440 per share. The analysts view this as a positive signal for Netflix's longer-term pricing power.
It is worth mentioning that Netflix raised prices six months ago in the U.S. and other markets, including Canada, Portugal, and Argentina. The Standard ad-free plan in the U.S. increased from $15.49 to $17.99 per month, and the ad-supported tier also increased in price, to $7.99 per month.
Netflix no longer reports subscriber numbers on a regular basis, so investors will be looking for commentary around content spending, traction of the ad-supported tier, Netflix's live programming strategy, and other trends when the company reports Q2 2025 earnings after market close on July 17.
The survey results do not reflect the willingness to pay of subscribers in other markets like Canada, Portugal, and Argentina. However, the positive customer acceptance of Netflix's pricing initiatives as of May 2025 underlines the company's strategic approach to pricing and its ability to adapt to market conditions.
In light of the survey results, it is evident that a significant number of Netflix subscribers in the U.S. are willing to pay more for the service, potentially contributing to an increase in revenue from business sectors such as entertainment and finance. Despite the willingness, a substantial portion of subscribers would cancel their subscription if prices were raised, indicating a limit to this readiness.
