Netflix cofounder Reed Hastings is giving up his CEO role

Reed Hastings is stepping down as co-CEO of Netflix, the company he cofounded in 1997 as a DVD rental service and steered as it ushered in the streaming-TV era a decade later. He announced the move on Thursday, saying he will remain at Netflix as executive chairman, and citing fellow Big Tech leaders Bill Gates and Jeff Bezos who have followed similar paths.

Ted Sarandos will remain as co-CEO, a role he assumed in the summer of 2020 when Netflix was enjoying an influx of pandemic-era subscribers. Sarandos will be joined by Greg Peters, formerly the company’s chief operating officer. The change in leadership is effective immediately, Hastings said in the memo, which was posted to the Netflix website.

“Ted and Greg have developed great trust and respect for each other through their collective successes and failures,” Hastings wrote. “In addition, they can always be relied upon to put Netflix’s interests first. These qualities—combined with their complementary skill sets, deep knowledge of entertainment and technology, and proven track record at Netflix—create a unique opportunity to deliver faster growth and greater success long term with them as co-CEOs.”

The announcement comes along with Netflix’s mixed earnings report for the fourth quarter of 2022, in which the streaming giant significantly beat expectations for subscriber growth but missed on earnings per share, largely due to a $462 million “non-cash unrealized loss from the F/X remeasurement on our Euro denominated debt.” This was the result of the depreciation of the U.S. dollar against the euro in the fourth quarter, the company said.

The company’s subscriber boost is especially surprising, as Netflix last year had been struggling to sustain its growth. In April, it reported its first subscriber loss in about a decade. In short, 2022 had a “bumpy start but a bright finish,” Netflix said in its letter to shareholders.

Shares of Netflix were up more than 6% in after-hours trading after trending lower throughout much of the day on Thursday.