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Reed Hastings, co-founder of Netflix, handed over control of the firm to co-CEO Ted Sarandos and COO Greg Peters when he stepped down as co-CEO. He will now be the executive chairman. Meanwhile, following the company’s announcement that it had more members than expected at the end of 2022, Netflix shares rose 6.1% to $335.05 in after-hours trading.
Hastings’ retirement comes after Netflix reported 7.66 million new members in the fourth quarter, above Wall Street projections of 4.57 million due to Harry and Meghan and Wednesday. Although Refinitiv polled experts expected 45 cents in profits per share, the actual amount was 12 cents. Through March, Netflix expects “moderate” subscriber growth.
The board has spent the previous ten years planning for a change in leadership, which will take effect immediately. Both Peters and Sarandos were elevated when the company faced hardship in July 2020. The corporation has been under pressure as a result of losing customers in the first half of 2022. Its stock, which was once a Wall Street favourite, has dropped 38% in the last year.
Netflix customers fell in the first half of 2022. Despite resuming growth in the second half, the rate of new customer additions is lower than in previous years. To encourage development, Netflix launched a lower-cost, ad-supported edition in 12 countries in November. It has also taken steps to limit password sharing.
Hastings referred to it as “baptism by fire,” citing the COVID-19 epidemic as one of the company’s recent hurdles while applauding Peters and Sarandos. “They’ve both done a fantastic job. ” As a result, the board and I think the moment has come to finalise my succession,” he said in a statement.
Netflix expected a 4% annual income rise throughout the period with the help of additional revenue streams. Consumer spending is restrained, and the corporation faces competition from Walt Disney, Amazon, and other companies that are pouring billions of dollars to develop TV series and movies for internet audiences.