‘Price Hike Could Add $780M,’ Says BofA about Amazon Stock (AMZN)

Amazon AMZN -0.89% ▼ is making a change to its streaming service that could bring in more revenue. Starting April 10, the company will rebrand its ad-free Prime Video plan in the U.S. as Prime Video Ultra and raise the monthly price to $4.99 from $2.99. Customers who already have a Prime membership will also be able to choose an annual Ultra plan for $45.99, which is cheaper than paying the monthly price over a full year.

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The move caught the attention of Wall Street.

Top BofA Securities analyst Justin Post reiterated a Buy rating on Amazon stock and kept his $275 price target.

Post estimates that the price increase could generate up to $780 million in additional yearly revenue. His estimate assumes that about 20% of Prime Video’s 130 million U.S. viewers currently pay for the ad-free version, which would equal roughly 32.5 million users.

However, the analyst believes many of those users are already Prime members. Because of that, a large share may switch to the lower-priced annual Ultra plan instead of paying the higher monthly fee.

Even so, Post said the change could still help Amazon’s subscription revenue grow faster, potentially adding about one percentage point to yearly growth. Amazon’s subscription business was already running at about $52 billion a year at the end of 2025.

The analyst also noted that Amazon plans to reinvest the extra revenue into Prime Video, which could help improve the service over time.

While the move makes a near-term increase in the overall Prime membership fee less likely, Post remains positive on Amazon. He said the company continues to find new ways to earn more from its Prime ecosystem, while also lowering the cost of delivering goods.

Is Amazon a Buy, Sell, or Hold?

Turning to Wall Street, analysts have a Strong Buy consensus rating on AMZN stock based on 40 Buys and three Holds assigned in the past three months, as indicated by the graphic below. Furthermore, the average AMZN price target of $279.88 per share implies 34.77% upside potential.

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