Hastings moves to chairman role at Netflix

Netflix Inc. said co-founder Reed Hastings has stepped down as co-chief executive and will become executive chairman, in a leadership shuffle that comes as the streaming giant beat its own forecast for subscriber gains.

- Sarah Krouse

The company on Thursday elevated heir apparent Greg Peters who was key to the swift launch of an ad-supported tier of Netflix and previously served as chief operating officer to co-CEO alongside Ted Sarandos.

"Frankly, more and more, they've been leading the company," Mr. Hastings said of Messrs. Sarandos and Peters during a video interview for investors Thursday.

The streaming industry is facing a radically different set of challenges: Investors now value profitability over subscriber growth, and consumers have become increasingly fickle given the ever-growing number of streaming options.

The move marks the end of Mr. Hastings's 25-year run at the helm of Netflix, which he helped turn from a DVD-by-mail upstart into the world's dominant streaming service. As subscriber growth slows, Netflix is looking to boost revenue by embracing advertising and cracking down on account sharing.

The company's board had been discussing succession planning for many years, Mr. Hastings said in a blog post Thursday. He said becoming executive chairman is a step that founders often take when they leave the role of CEO, citing Microsoft Corp. co-founder Bill Gates and Amazon.com Inc. founder Jeff Bezos as prominent examples.

Netflix said Thursday that it beat its own forecast for subscriber gains in the final quarter of the year, adding nearly 7.7 million new customers. It had previously said it expected to add 4.5 million during the period.

"2022 was a tough year, with a bumpy start but a brighter finish," Netflix said in its quarterly letter to investors, adding that it has a clear path to reaccelerate its revenue growth. It ended the year with 230.8 million subscribers globally.

Netflix shares were up 6.9% in after-hours trading.