Netflix’s CEO Quits Despite Streaming Service Hitting 230 Million Subscribers

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Netflix's CEO Quits Despite Streaming Service Hitting 230 Million Subscribers
Netflix's CEO Quits Despite Streaming Service Hitting 230 Million Subscribers

What started as a bumpy year, ended with 230 million subscribers with an increase in projected revenue for Q4 which Brand Spur Nigeria earlier reported. United States streaming services giant Netflix has ended the year with more than 230 million global subscribers.

According to a statement by Netflix, the streaming platform described the year 2022 as ” a tough year, with a bumpy start but a brighter finish,” while it also announced that Reed Hastrings, co-founder and CEO of Netflix was stepping down from his leadership role, which he held for 25 years, which he grew the company from rent-by-mail DVD service to an entertainment giant.

Hastrings has now stepped down from his role as CEO and called upon his longtime associates, Chief Operating Officer Greg Peters and Ted Sarandos, who has been the face of Netflix in Hollywood, as co-CEO.

Hastings said during an earnings call. “It feels like yesterday was our IPO; we were covered in red envelopes,” Hopefully, some of you have held the stock for all 21 years.”

Netflix, in 2002 became a publicly traded company with an opening price of its share at $15 and saw shares in the streaming television services go up by almost 7% to $337.31, after-market trades that followed the release of the earnings figures.

Although Netflix, which has held discussions on succession plans for many years, never found the perfect feet for the founder’s shoes. Hastrings also hinted at the new role he would take on in the company in a blog post, where he said “even founders need to evolve!”.

He disclosed that he would now hold the post of executive chairman while adding that most founders in tech giant companies like Amazon and Microsoft have seen their founders become chairmen.

This new announcement follows the recent addition of 7.7 million subscribers to his platform, surpassing its previous expectation, and bringing its total subscribers to 230 million. It also added that the recent addition came in three months.

However, it attributed this recent success to his latest batch of new content which included the horror-themed comedy “Wednesday” saying that the “Addams Family” sequel was the company’s third most popular series ever.

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A Royal tell-all documentary” Harry & Meghan” also had good numbers, as well as “Glass Onion: A Knives Out Mystery” which starred James Bond legend, Daniel Craig.

Tech and media analyst Paolo Pecastore added, “This is in stark contrast to the first half of the year. Creating the next biggest blockbuster drives subscribers,”.

The fresh new movies which were added to the mix attracted a new lower-priced “Basic with Ads” subscription, as most of their consumers cut back on their entertainment spending despite the soaring inflation during an unstable economy.

Revenue also rose to $7.85 billion from October to December which is in line with estimates. Netflix, also disclosed that it no longer counts increases in new users as a criterion for determining the company’s health and it would be focusing on revenue as its major metric.

Netflix’s ads businesses also added that “That means, most likely, lower average revenue per subscriber, which is a measure Wall Street will be paying more attention to as Netflix’s ad businesses scale up,”.

While Insider Intelligence principal analyst Paul Verna also mentioned that “What may be getting lost in the mix is that some number of new subscribers – we don’t know how many – likely came in on Netflix’s ad-supported tier,”.

This year, Netflix is also making it a goal to nudge viewers who share in other’s subscription plans to pay their own way.

While Netflix chief financial officer Spencer Neuman added that “We have high confidence in our ability to accelerate revenue throughout the course of the year as we scale ads and we launch paid sharing (of accounts),”.

Despite strong opposition consisting of deep-pocketed rivals, which includes Disney+, who also introduced ad-based subscriptions recently. Netflix keeps gathering confidence on Wall Street with its share price up to almost 50% in the last six months. While other movie streaming services platforms like Disney+ are currently experiencing challenges in the market due to its recent layoffs and cutting costs which it incurred during the height of the Covid-19 pandemic.