Founder Reed Hastings’ net worth is down more than $800 million.
A week after releasing a bleak second-quarter earnings report, the company’s shares are down nearly 20%, a loss of $26 billion in market value. The net worth of founder Reed Hastings, who owns about 2.5% of Netflix’ shares, fell $850 million over that period, to $3.4 billion.
The downturn comes during an otherwise positive year. Shares had risen 35% between January 1 and July 17. On that day, Netflix published its quarterly results, which showed a decline of 126,000 U.S. subscribers, compared with an expected gain of 300,000. Globally, it added 2.7 million subscribers, far short of its forecast of 5 million.
Still, the streaming service said it expects to add 7 million subscribers during the third quarter. “Consumers around the world continue to move from linear television to internet entertainment at a remarkable rate,” it said in the report.Hastings, 58, took a circuitous route to Silicon Valley. He studied math at Bowdoin College, then shipped off to the Peace Corps in Swaziland. After returning, he completed a master’s program in artificial intelligence at Stanford.
Hastings cofounded Netflix in 1997 with Marc Randolph, who left the company in 2004. It originally operated as an online DVD rental service, before adding streamed video in 2010. The following year, Hastings announced plans to separate the DVD and streaming businesses, which caused a customer revolt. Netflix’ stock fell 74% in five months, though users eventually got over the change. , for instance, was watched by 25 million households during its first month online.
Competition in the streaming space is heating up, however. Amazon and Hulu remain significant rivals, while entertainment giants like Disney and NBCUniversal have plans to unveil platforms of their own. At the end of 2020, Netflix will lose one of its most popular programs,
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