Amazon is raising the cost of an annual Amazon Prime subscription for U.S. customers to $119, the company announced today. Prime Student memberships are also getting more expensive: They will now cost $59 per year.
In each case, the new price represents an increase of 20 percent over the current cost, which is $99 for Prime subscriptions and $49 for Prime Student memberships.
The increase will take effect for new Prime subscribers on May 11, while memberships for existing customers will renew at the higher rate starting June 16. Amazon last raised the annual subscription price four years ago, in April 2014, to $99; that was the first time the company had increased the cost since introducing Prime in 2005 for $79 per year.
“The value of Prime to customers has never been greater,” said Brian Olsavsky, Amazon’s chief financial officer, in announcing the price hike during an earnings call this afternoon. “And the cost is also high, as we pointed out — especially with shipping options and digital benefits, we continue to see rises in costs.”
Amazon reported sales of $51.04 billion during the quarter ending March 31, 2018, up 43 percent year over year. Last week, Amazon gave Prime subscription figures for the first time, with CEO Jeff Bezos announcing in his annual shareholders letter that the company now has more than 100 million Prime members worldwide.
The price increase applies only for annual Prime subscriptions. In January, Amazon raised the cost of monthly Prime and Prime Student memberships in the U.S. to $12.99 and $6.49, respectively — a jump of just over 18 percent in each case.
Amazon Prime started out offering free two-day shipping on many items purchased from the retail giant. The company has expanded the membership over the years to encompass a wide range of benefits that now include streaming video and music services, a photo storage service, free Kindle titles, Thursday Night Football NFL games, and Twitch Prime membership (which now comes with free PC games).