Amazon.com Inc. announced a 17 percent increase in the price of its annual US Prime subscriptions on Thursday, as it seeks to offset rising shipping and payroll expenses that it expects to continue this year. Amazon’s stock jumped as much as 17% after the company surpassed earnings forecasts for the holiday season in extended trading.
The increase will take effect on February 18
According to The Irish Times, Amazon made $14.3 billion in the holiday quarter, more than doubling its net income from the previous year, including a pre-tax gain of $11.8 billion from its interest in Rivian Automotive, an electric car manufacturer. Amazon has put money into its processes to manage interruptions, most recently the Omicron form of Covid-19, following a windfall from increased at-home shopping during the pandemic.
It advertised signing bonuses to attract hundreds of thousands of workers in a tight labor market, and it increased shipping costs because it couldn’t get products into the correct warehouses. Prime, Amazon’s fast-shipping and media subscription service, will now cost $14.99 a month in the United States, up from $12.99 before, with an annual membership costing $139, up from $119 previously.
Amazon shared that the update takes effect on February 18th for new members and includes enhanced perks such as prescription medicine savings and speedier delivery.
Take note of how much you will be paying
Amazon Prime will increase prices from $119 to $139 per year or $13 to $15 per month for most customers. Students and other low-income users will see their costs rise as well. Members of Prime Student will shortly pay $7.50 per month or $69 for the year. The monthly charge for recipients of Electronic Benefit Transfer and other qualifying types of government assistance will increase from $6 to $7 per month, CNET reported.
Current Amazon Prime subscribers should check their accounts to verify if they are on a monthly or yearly subscription. If you move from a monthly to an annual subscription, you’ll get the $119 pricing for the rest of the year.
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