Netflix names Ted Sarandos co-CEO, forecasts weaker growth

By Lisa Richwine and Neha Malara (Reuters) - Netflix Inc on Thursday said its subscriber growth during the coronavirus pandemic would slow even more than Wall Street expected during the third quarter, sending its shares tumbling more than 10% in after-hours trading. The company also elevated Ted Sarandos to co-chief executive alongside Reed Hastings. Sarandos will continue his role as chief content officer

Reuters July 17, 2020 03:05:15 IST
Netflix names Ted Sarandos co-CEO, forecasts weaker growth

Netflix names Ted Sarandos coCEO forecasts weaker growth

By Lisa Richwine and Neha Malara

(Reuters) - Netflix Inc on Thursday said its subscriber growth during the coronavirus pandemic would slow even more than Wall Street expected during the third quarter, sending its shares tumbling more than 10% in after-hours trading.

The company also elevated Ted Sarandos to co-chief executive alongside Reed Hastings. Sarandos will continue his role as chief content officer.

For July through August, Netflix forecast it would add 2.5 million new paid streaming customers around the world. Analysts on averaged expected a projection of 5.3 million, according to IBES data from Refinitiv. (https://bit.ly/2DQW1n9)

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 as the 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."

Shares of Netflix, which ranked among the biggest gainers of the pandemic, plunged 10% to $472.89 in after-hours trading.

With the new members, the world's dominant streaming service reached nearly 193 million paying online customers.

Netflix is trying to win new customers and outrun the competition as viewers embrace online viewing. The start of the pandemic sparked new interest in the service as people around the world were told to stay home, movie theaters went dark and sports leagues canceled live games.

New releases during the quarter included "Space Force," "Too Hot to Handle," a Jerry Seinfeld comedy special and new seasons of "Money Heist" and "Dead to Me."

Netflix's membership rolls rose even as it faced more streaming competition than ever. Walt Disney Co's Disney+ came online in November, and AT&T Inc debuted HBO Max in May, among other newcomers. Graphic: Netflix total subscription growth - https://graphics.reuters.com/NETFLIX-RESULTS/qzjpqezwkpx/chart.png

(Reporting by Neha Malara and Lisa Richwine in Los Angeles; Editing by Arun Koyyur and Lisa Shumaker)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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