Ted Sarandos and Greg Peters are to become the joint CEOs of Netflix after Reed Hastings announced he was to relinquish the role after 25 years.
Hastings will now become executive chairman of the streamer.
Sarandos, who was appointed co-CEO alongside Hastings in 2020, will share duties with Peters, who steps up from his current role as COO.
In a blog post, Hastings said he had increasingly delegated the management of Netflix to them. Both he and the board believed it was the right time to complete the succession.
“Ted and Greg have developed great trust and respect for each other through their collective successes and failures. In addition, they can always be relied upon to put Netflix’s interests first,” Hastings wrote.
Hastings started Netflix as a DVD by-post business before entering the streaming market. He now plans to spend more time on his philanthropy interests, while ensuring that Netflix stock continues to do well.
Paolo Pescatore of analyst PP Foresight commented: “While Hastings stepping down seems like a shock, timing is key. He has been at the helm for some time and every company needs to change, move with the times. He will still be closely affiliated with the company. From a leadership perspective he has played an influential role in making Netflix a success and driving force in streaming. The company must not lose its focus on driving innovation and disruptive.”
The moves came as Netflix reported it had added 7.7 million new subscribers in the fourth quarter, well ahead of market expectations. The streamer has enjoyed success with The Addams Family spin-off Wednesday and the Harry & Meghan polemic.
The company said it was pleased with the initial performance of its advertising tier launched in November. Although it was early days, the company said it was pleased with the engagement of subscribers, which was comparable with those on the traditional ad-free plans. There had also been very little switching between plans.
Paid Sharing, the tier launched to counter the problem of subscriptions being “borrowed” from a paying household will be rolled out more widely in 2023. Netflix says the problem is “widespread” and accounts for over 100,000 million lost households. New features to counter the problem include the ability for subscribers to review which devices are using their account and to transfer a profile to a new account.
Where available, subscribers will have the option to pay extra if they want to share Netflix with people they don’t live with.