CEO Reed Hastings resigns, COO Greg Peters takes on co-CEO role
Netflix (NFLX) co-CEO and co-founder Reed Hastings announced Thursday that he is stepping down to lead the company. COO Greg Peters will join current Netflix co-CEO Ted Sarandos in that role. Hastings will now be the company’s executive chairman.
Netflix also reported mixed fourth-quarter financial results, with subscriber growth beating expectations of 7.66 million versus a forecast of 4.5 million, with adjusted earnings falling short of expectations. expected.
Shares of Netflix jumped as much as 6% following the news.
Here are Netflix’s fourth-quarter results compared to Wall Street consensus estimates, compiled by Bloomberg:
Revenue: $7.85 billion vs. $7.86 billion expected
Adjective. Earnings per share (EPS): 0.12 dollars vs. $0.58 expected
Subscribers: 7.66 million vs 4.5 million net addition expected
Quarterly net additions rose 7.66 million, above the company’s forecast of 4.5 million as the streaming giant rolled out new initiatives such as a suppress password sharing and a recently launched ad-supported tier to help drive growth.
A series of popular and record-breaking content releases, including “Glass Onion”, “Troll”, “All Quiet on the Western Front”, “My Name is Vendetta” and “Wednesday” also supported the upside momentum. Registrar’s Head.
The guidance came in strong with revenue expectations for the first quarter of 2023 set at $8.17 billion as forex headwinds begin to ease amid US dollar weakness. . As previously stated, the company does not provide a subscriber growth guide because “revenue is our primary leading metric.”
Netflix also said it expects earnings per share to come in at $2.82 with an estimated 2023 free cash flow expectation of at least $3 billion.
Netflix stock has skyrocketed in recent weeks, up about 60% over the past six months with about Up 10% so far in Januaryoutperformed the Nasdaq Composite’s 5% gain.
“The year 2022 has been a rough year, with a bumpy start but a brighter finish. We believe we have a clear path to accelerating revenue growth: continue to improve every aspect of Netflix. , rolled out paid sharing and built its advertising service,” the company wrote in a letter for shareholders. “As always, our northern stars delight our members and generate even greater returns over time.”
Investors will be keeping a close eye on the company’s earnings call for more updates on the company’s newly launched ad-support tier, in addition to a crackdown on password sharing.
Analysts have warned investors that the impact of Netflix’s foray into advertising it will take some time to boot granted Just opened in November.
The ad plan, dubbed “Basic with Ads,” costs $6.99 a month in the US and serves as a complement to Netflix’s existing ad-free tiers — the Standard plan ($15.49/month) and the Basic plan ($9.99). )
Other questions include whether Netflix will reduce its $17 billion worth of content spending, in addition to the possibility that the company will make more mergers and acquisitions with WWE up for sale.
Alexandra is a Senior Media and Entertainment Correspondent at Yahoo Finance. Follow her on Twitter @allliecanal8193 and email her at [email protected]
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