The co-founder of the streaming giant, Reed Hastings has resigned as the Co-Chief Executive Officer of Netflix, a position he has held for about 25 years.
In a blog post published by the company, Hastings said he will now be the executive chairman of the company while Greg Peters will step up from COO to co-CEO with Ted Sanders. Netflix operates with two CEOs.
“Starting today, Greg Peters will step up from COO to become Ted’s co-CEO. Going forward, I’ll be serving as Executive Chairman, a role that founders often take (Jeff Bezos, Bill Gates, etc.) after they pass the CEO baton to others. Ted, Greg, and I have been working closely together in different capacities for 15 years. As is common in long, effective relationships, we’ve all learned how to bring out the best in each other. I look forward to working with them in this role for many years to come.”
The announcement helped boost the company’s share price by about 6%.
The change is coming at a period where Netflix faces increased competition from the likes of Hulu, Disney, and Amazon who have also jumped in on the lucrative streaming business.
Netflix’s valuation has fallen by about a third in the last year as investors react to a stall in its subscriber growth amidst growing competition.
In reaction, Hastings swallowed his words ditching a long-time strategy of never allowing advertising. The company introduced a new tier of advertising last November to attract more value-driven customers.
CEO Compensation: As part of the executive compensation, the company reported in an SEC filing that co-CEO, Greg Peters would receive an annual salary of $3 million with an annual stock option allocation of $17.325 million, and an estimated target bonus of $14.325 million. Peters also joins the board.
As executive chairman, Hastings will receive an annual salary of $500,000 with no target bonus, and a stock option allocation of $2.5M.
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