Netflix forecast a weaker-than-expected second quarter, sending its shares down over 9% in extended trading despite posting strong first-quarter revenue and earnings. The company also said co-founder Reed Hastings will step down from the board.
The streaming pioneer also announced that chairman and co-founder Reed Hastings is stepping down from the board after 29 years to pursue philanthropy and personal interests.
Revenue rose 16% in the first three months of the year to $12.3 billion, compared with estimates for $12.2 billion, the company said in a statement on Thursday. Earnings per share for the quarter were $1.23 compared with estimates of 76 cents.
In the current quarter, however, Netflix forecast earnings per share of 78 cents, less than the 84 cents predicted by Wall Street analysts. The shares tumbled more than 9% in trading after the news.
Netflix walked away from a contentious battle for control of Warner Bros. Discovery Inc. in February. The company’s shares had suffered during the months long tussle with Paramount Skydance Corp. as investors were concerned about the amount of debt it would shoulder under a potential deal.
Now Wall Street is looking for signs Netflix can keep subscribers engaged. Netflix raised its subscription prices in March, boosting its standard plan without ads by $2 to $20 a month.
