January 27, 2023

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Reed Hastings is stepping down as CEO of Netflix – E24

The streaming giant is crushing expectations with strong new subscriber growth, and Netflix CEO Reed Hastings has its thanks for it.

published:

Numbers from the fourth quarter show that the company gained 7.6 million new paying subscribers. There are a lot more new users than expected. Upfront, the company estimated that user growth would be 4.5 million globally.

  • The company expects revenue to grow 4 percent to $8.17 million in the first quarter of 2023, according to the quarterly report. The company points to growth in paying users as one explanation.
  • Fourth quarter revenue was $7.85 billion. This is just above expectations of $7.86 billion, respectively.

The share rose more than six percent in after-market trading.

Netflix CEO resigns

Reed Hastings is stepping down as CEO of the company. However, the Netflix founder will continue as acting chairman. Ted Sarandos and Greg Peters will jointly lead the company.

Sarandos and Hastings have led the company together from July 2020 to today.

Greg Peters comes from the electric giant’s COO position. The three have worked together at Netflix for the past 15 years.

Ad and password capture

During the first and second quarters, Netflix lost approximately 1.2 million subscriptions. Netflix has never experienced negative subscriber growth before the first quarter of last year. However, in the third quarter, things would pick up, and Netflix saw a growth of 2.4 million subscribers.

After customers migrated in the first quarter of last year, Netflix took action.

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The company has launched a major ad-funded subscription initiative where users can choose to watch ads for cheaper subscriptions. In the US, these subscriptions cost $6.99 per month. The solution is not currently available in Norway.

While showing the third-quarter numbers, Jeremy Gorman, Netflix’s chief marketing officer, told Bloomberg that it was “delighted with the growth” in the advertising segment. You didn’t want to provide numbers on the number of users using the solution.

– You’ll see if I’m an anxious person – I put it on my face, she said.

The energy giant also announced that it would clamp down on sharing passwords between users in the same household. The company has announced that it will start a pilot project in Latin America in 2023 to try to take advantage of account sharing, Bloomberg writes.