July 1 - Amazon (AMZN, Financial) may be gearing up for its next Prime fee increase, potentially unlocking billions in additional revenue, according to Wall Street speculations.
Analysts point to rising delivery and content costs as key drivers behind an expected jump from the current $139 annual rate. J.P. Morgan's Doug Anmuth estimates that a $20 U.S. price bump, to $159, could generate about $3 billion more each year, without materially denting membership growth.
Prime's perceived value has climbed sharply since its 2005 debut at $79. Unbundling today's benefits, from expedited shipping to streaming and exclusive deals, yields an estimated $1,430 of annual worth, more than double the $544 valuation projected in 2016.
Historically, Amazon has lifted Prime fees roughly every four years: to $99 in 2014, $119 in 2018 and $139 in 2022. Despite potential pushback, analysts believe customer retention will remain strong, given Prime's broad service mix and fast delivery speeds.
If Amazon follows its usual cadence and implements a fee hike in 2026, the boost could further strengthen its services segment, which already posted $44.4 billion in revenue last fiscal year in the face of heightened competition and costs.
Such a move may prove pivotal as Amazon continues to balance growth with profitability.
