Reed Hastings, the co-founder and current chair of Netflix, is scheduled to step down from the company’s board this June.
The announcement marks the conclusion of a leadership transition for the executive who, since co-founding the firm in 1997, oversaw its evolution from a DVD-by-mail service into a global streaming powerhouse valued at $450 billion.
According to the company, Hastings intends to “focus on his philanthropy and other pursuits.” His departure follows a phased reduction in responsibilities that began in 2020 with the appointment of Ted Sarandos as co-CEO, followed by Greg Peters taking over Hastings’ role as co-CEO in 2023.
Despite the news of his departure, Netflix shares fell by as much as 9 per cent in after-hours trading. The decline was primarily attributed to a weaker-than-expected financial forecast for the upcoming quarter.
While Wall Street analysts had anticipated earnings of 84 cents per share, Netflix projected a lower figure of 78 cents.
The market volatility overshadowed a strong performance in the first quarter, during which the company reported a net income of $5.3 billion on revenue of $12.3 billion. Earnings per share for the period reached $1.23, significantly surpassing the 76 cents predicted by analysts.
These quarterly results were bolstered by a $2.8 billion break fee received from Paramount, following the latter’s decision to withdraw its bid for Warner Bros Discovery. Netflix also noted that its operating income was lifted by price increases introduced during the quarter.
Regarding the potential acquisition of Warner Bros, Netflix stated that while it “would have been a nice accelerant” for the company’s strategy, a deal would only have been viable “at the right price.”
Although Netflix shares have climbed approximately 15 per cent this year – recovering some ground lost during the bidding war for Warner Bros – the stock remains well below the record highs recorded last summer.
