Amazon Prime hasn’t seen many price-hikes, but the ones it has seen have been significant, and according to a new announcement from the company, Amazon just increased the price for an annual membership by $20.
Amazon increased the price after the Q4 results from last year
Amazon Prime has been a popular subscription for years now. Members get free same-day, one-day, and two-day shipping, Prime Video, and much more. You get a lot of perks with this service, and they’re plenty worth it if you’re an avid Amazon shopper.
The issue is that $20 is a pretty significant jump. The last time Amazon raised the price on Prime was back in 2018, so the company isn’t exactly raising the price every year. Still, this will undoubtedly cause some people to ditch the service altogether.
The new price is now up to $139/year. That’s about a 17% increase from the previous price which was $119/year. The monthly plan also saw an increase from $12.99/month to $14.99/month.
There’s still time to get the lower price
This isn’t an instant change, so there’s still time to get the membership at the current price. If you are considering getting Amazon Prime, you have until February 18th to enjoy the $119 price. For current customers, your plan will officially change on March 25th. If your plan renews before that date, you should still be charged $119.
This might actually have some benefits in the short run along with the long run. Amazon could see a surge of people rushing to get in at the lower price.
This new price makes sense, looking at the company’s earnings
Companies raising their prices is a reality; think about the recent price increase with Netflix. So, it makes sense why Amazon is raising the price again. Not only that, but the company did see some declines in its earnings last year. The company saw a 30% operating cash flow decrease from $66.1 billion to 46.3 billion.
Amazon’s operating income saw a huge hit. It added up to $3.5 billion which is down from $6.9 billion in Q4 2020. We can’t rule out the fact that 2020 was such a strong year for the company due to the pandemic. A lot more people ordered items through online retailers rather than going out.
It’s hard to tell whether this will help the company make up for its losses. We’re not sure if many people will continue to use the services after the price goes up. Only time will tell. If you aren’t a subscriber, you should consider trying it out before the price rises.