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Reed Hastings, Co-CEO, Netflix speaks at the 2021 Milken Institute Global Conference in Beverly Hills, Caif. on Oct. 18, 2021.DAVID SWANSON/Reuters

Netflix Inc. co-founder Reed Hastings announced on Thursday he will step down as chief executive, handing the reins of the streaming service to his long-time partner and co-CEO, Ted Sarandos, and the company’s chief operating officer, Greg Peters.

Shares of the company, which had fallen nearly 38 per cent in the past year, rose 7.9 per cent to US$340.66 in after-hours trading.

Mr. Sarandos and Mr. Peters will share the title of chief executives, with Mr. Hastings serving as executive chairman. The change is effective immediately, representing the culmination of a decade of succession planning by the board. Both Mr. Peters and Mr. Sarandos were promoted in July, 2020, amid a challenging time for the company.

“It was a baptism by fire, given Covid and recent challenges within our business,” Mr. Hastings wrote in a blog post announcing his departure. “But they’ve both managed incredibly well … so the board and I believe it’s the right time to compete my succession.”

Mr. Hastings made his exit as Netflix reported it added 7.66 million subscribers in the fourth quarter, beating Wall Street forecasts of 4.57 million with help from Harry & Meghan and Wednesday in the battle to attract streaming television viewers.

The streaming video pioneer has been under pressure from restrained consumer spending and competition from Walt Disney Co., Inc. and others spending billions of dollars to make TV shows and movies for online audiences.

Netflix lost customers in the first half of 2022. It returned to growth in the second half, but new customer additions remain below the pace of recent years.

To kick-start growth, Netflix introduced a cheaper, ad-supported option last November in 12 countries. It also has announced plans to crack down on password sharing.

The company’s global subscriber base hit 231 million at the end of December.

Audiences flocked to Addams family tale Wednesday, the third-most watched show in Netflix history, the company said. Murder mystery Glass Onion and British royals documentary Harry & Meghan also were hits during the quarter.

Net income fell to US$55-million or 12 US cents a share, from US$607-million or US$1.33 a share a year earlier. Revenue rose 1.9 per cent to US$7.85-billion, in line with expectations.

Bela Bajaria, Netflix’s head of global television, was named chief content officer.