San Francisco, 17th Jul 2020: Online streaming platform Netflix promoted its content chief Ted Sarandos as a co-CEO after it forecast that subscriber growth would slow even more than Wall Street expected during the third quarter, sending its shares tumbling 9.5% to $477.15 in after-hours trading.
The move to promote content chief as a co-CEO is a clear indication of a successor to co-founder Reed Hastings.
Sarandos will continue his role in leading the content operations. Hastings said the two would each work full time as co-CEOs and that he had no plans to leave the company soon.
Netflix also gave Chief Product Officer Greg Peters the additional role of a chief operating officer.
Netflix forecast it would add 2.5 million new paid streaming customers around the world in this quarter.
However, Investors are disappointed with the latest Netflix figures and expecting a slow growth in the upcoming quarters.
For the June quarter, the company reported diluted earnings per share of $1.59, below analyst forecasts of $1.81. Revenue climbed 25% to $6.1 billion.
Netflix added 10.1 million streaming subscribers from April through June, its highest second-quarter gains ever, as the novel coronavirus forced people around the world to shelter at home.
Those restrictions led to “huge growth in the first half of the year,” Netflix said in a letter to shareholders, but “as a result, we expect less growth for the second half of 2020 compared to the prior year.”
With the new members, the world’s dominant streaming service reached nearly 193 million paying online customers.