Netflix Faces Hefty Refund Bill After Italian Court Rejects Years Of 'Unfair' Price Hikes

On Friday, an Italian court found that the contractual clauses Netflix Inc. (NASDAQ:NFLX) used to raise subscription prices between 2017 and early 2024 were unfair, siding with the consumer group Movimento Consumatori. Court Rules Netflix Price Hikes Violated Consumer Law The court said the clauses breached Italy's Consumer Code by allowing price increases without clearly stating valid reasons in the contract, Reuters reported. The ruling effectively voids those terms, marking a significant legal setback for the streaming giant in one of its key European markets. Refunds And Compensation For Millions Of Users Under the decision, affected subscribers are entitled to partial refunds, price reductions, and, in some cases, additional compensation. Lawyers representing consumers said cumulative increases amounted to roughly €8 ($9.22) per month for Premium plans and €4 for Standard plans over the period. This translates to potential refunds of about €500 for long-term Premium users and €250 for Standard subscribers. Italy had more than five million Netflix subscribers as of 2025, according to communications authority data. Netflix To Appeal Ruling In a statement to the publication, Netflix said it plans to challenge the decision, maintaining that its pricing practices complied with Italian laws. Netflix did not immediately respond to Benzinga's request for comment. The court also ordered Netflix Italia to publicly disclose the ruling on its website and in national newspapers, ensuring consumers are informed of their rights. Netflix Raises US Subscription Prices Again Last month, Netflix increased prices across all three of its U.S. subscription tiers for the second time in just over a year. The ad-supported Standard plan rose by $1 to $8.99 per month, while the ad-free Standard plan, which allows streaming on two devices, climbed by $2 to $19.99. The Premium tier, offering ad-free viewing on up to four devices along with Ultra HD and HDR, also saw a $2 hike, bringing its monthly cost to $26.99. Price Action: NFLX closed at $98.66, up 3.25%, and slipped 0.39% to $98.28 in after-hours trading, according to Benzinga Pro data. According to Benzinga Edge Stock Rankings, Netflix is trending downward over the long term but shows an upward trend in the short and medium term, with a Growth ranking in the 94th percentile. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Image via Shutterstock