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Netflix co-founder and CEO, Reed Hastings, is in Sydney to meet with executives of other subscription streaming services on Feb. 25, 2022.
Wolter Peeters | Fairfax Media | Getty Images
Netflix shares fell nearly 9% in extended trading on Thursday after the streaming giant released its first-quarter earnings report.
The company beat Wall Street expectations for revenue, reporting $12.25 billion for the first quarter, topping the $12.18 billion expected by analysts polled by LSEG and 16% higher than the $10.54 billion it reported in the year-ago quarter.
Thursday marked the company's first earnings report since it walked away from its proposed acquisition of Warner Bros. Discovery's streaming and film assets in February.
Netflix reported net income of $5.28 billion, or $1.23 per share, nearly double the $2.89 billion, or 66 cents per share, that it reported during the same period last year. The company cited higher-than-projected operating income and the $2.8 billion termination fee that it received after the WBD deal fell through.
Reported EPS was not immediately comparable to analyst expectations of 76 cents.
On Thursday Netflix also announced that Reed Hastings, Netflix's co-founder and current chairman, would exit the board in June when his term expires.
Hastings stepped down from his CEO role in 2023. Greg Peters, who had served as chief operating officer, stepped into the co-CEO role alongside Ted Sarandos.
"Netflix changed my life in so many ways, and my all‑time favorite memory was January 2016, when we enabled nearly the entire planet to enjoy our service," Hastings said in the company's shareholder letter on Thursday. Hastings will now focus on philanthropy and other pursuits, according to the letter.
First quarter look
Netflix reported both its revenue and operating income were up during the first quarter -- 16% and 18%, respectively -- on the back of "slightly higher-than-planned subscription revenue."
Last month Netflix announced it would raise prices across all of its streaming plans.
"Our recent price changes have gone well, reflecting the strong value we provide members," the company said in the shareholder letter on Thursday.
Netflix also reiterated that it's on track to reach $3 billion in advertising revenue in 2026, or up two-times year-over-year, as it has begun to see the progress of that newer revenue line show growth.
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