Amazon Prime might be getting more expensive. The retailer revealed during its quarterly earnings conference call that it might jack up the price of the yearly subscription by up to 50%.
Prime currently costs $79 a year. It’s the best service a person could buy. Free two-day shipping on most everything Amazon sells? I don’t have to go to the store for toilet paper. Yes sir.
Amazon is in a tough spot. After being the street’s darling for so many years, the company’s stock is tumbling thanks to a sub-par performance this holiday season. Analysts expected Amazon to report revenue of $26.06 billion, and earn $0.66 per share. Put another way, in a quarter of strong GDP growth, Amazon managed to miss expectations on both its top and bottom lines.
As Amazon stated on its investor relations conference call, the cost of shipping is increasing and Amazon is unsure if it can continue to offer Prime at $79. It said it was considering raising the price by $20 to $40 a year.
Since its launch, Prime has become more than just a free shipping service. Amazon also bundles its video streaming and Kindle libraries with the subscription. As a long time subscriber, a price hike would put a frown on my face, but I would still re-subscribe. I simply hate going to the store.