UK Markets closed

Netflix co-founder Reed Hastings quits as CEO as Harry and Megan documentary beats expectations

 (Ian West/PA) (PA Archive)
(Ian West/PA) (PA Archive)

The co-founder of Netflix has stepped down as CEO after the company posted an uptick in subscribers.

Reed Hastings, 62, who founded the business in 1997, will be stepping into an Executive Chair role, to be replaced by current co-CEO Ted Sarandos and COO Greg Peters, who were promoted to their roles in 2020.

He said in a statement: “The board and I believe it is the right time to complete my succession.

“It was a baptism of fire, given Covid and recent challenges within our business…but they’ve both managed incredibly well.”

The firm reported a 7.7 million uptick in subscribers in the fourth quarter to 231 million, helping push shares up 6.1% to $335 in pre-market trading. Earnings per share of 12 cents came in well behind the 45 cents analysts had estimated, according to Refinitiv data.

The subscriber increase represents a marked turnaround for the streaming service, which saw some $47 billion wiped off its value in April after it reported quarterly numbers that fell well short of investor hopes.

The streaming giant reported a drop in subscribers for the first time in a decade, causing shares to plunge 30%.

But the business now expects further “modest” gains in subscribers, and forecasts 4% year-on-year growth.

In November, it introduced a cheaper subscription option that includes adverts, and said it would crack down on password sharing.

Netflix said it had been given a boost after the release of its Harry and Megan series, the second most-popular documentary series in its history, as well as by Glass Onion: A Knives Out Mystery starring Daniel Craig.

Hastings controls a 2% stake in Netflix and has a net worth of $3.3 billion (£2.7 billion) according to an estimate by Forbes.