Amazon Sets $20-A-Year Price Hike For Prime As Its Q4 Results Cheer Investors

deadline.com:

Amazon reported fourth-quarter revenue in line with Wall Street expectations and announced a $20-a-year increase in Prime subscription prices, causing its stock to stage a big rally after hours.Shares in the tech giant jumped as much as 18% in the minutes after the earnings news, after they had declined markedly earlier in the day.

They finished the regular trading session off 7% and have fallen 18% in 2022 to date. Many tech companies, notably Netflix, Spotify and Facebook parent Meta, have slumped badly in recent weeks.Total revenue gained 9% over the prior-year quarter to hit $137.4 billion, coming within a whisker of analysts’ estimates.Net income in the period hit $27.75 per diluted share, well ahead of estimates, but the figure included a pre-tax valuation gain of $11.8 billion from an investment in Rivian Automotive.

The electric vehicle maker had its IPO last November.Citing investments in faster delivery as well as video programming like NFL football and The Lord of the Rings, Amazon said Prime will now cost $139 a year.

It is the first increase since 2018 and the third since the customer loyalty program began. The jump has been $20 each time.