Reed Hastings
NETFLIXAbout Reed Hastings
Reed Hastings (age 64) is Netflix’s co‑founder and, effective April 17, 2025, transitioned from Executive Chairman to Chairman of the Board and a non‑executive director; he has served as a director and chairperson since 1997 . He holds a B.A. from Bowdoin College and an M.S. in Computer Science (AI) from Stanford; early career includes Peace Corps service as a high school math teacher and founding Pure Software (IPO in 1995, later sold to Rational) .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Netflix, Inc. | Chairman of the Board (non‑executive) | 4/17/2025–present | Board leadership; not on any committees |
| Netflix, Inc. | Executive Chairman | 1/13/2023–4/17/2025 | Transitioned from co‑CEO; strategic oversight |
| Netflix, Inc. | Co‑Founder, CEO & President | 1999–1/13/2023 | Led Netflix’s evolution from DVD to global streaming; industry leadership |
| Netflix, Inc. | Director and Chairperson | 1997–present | Board chair since inception |
| Pure Software | Founder, CEO | 1991–sale to Rational | Took company public in 1995; sold to Rational Software |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Bloomberg L.P. (private) | Director | Current | Private company board |
| Facebook, Inc. (now Meta Platforms) | Director | 2011–2019 | Prior public company directorship |
| Microsoft Corporation | Director | 2007–2012 | Prior public company directorship |
| Various non‑profits | Director/Trustee | Various | Educational philanthropy roles |
Board Governance
- Role and independence: Hastings serves as Chairman; he is not listed among directors the Board determined to be independent under SEC/Nasdaq rules (independent directors are Barton, Döpfner, Haley*, Hoag, Masiyiwa, Smith, Kilgore, Mather, Sweeney, and Ambassador Rice) .
- Committee assignments: None (Hastings is not on Audit, Compensation, or Nominating & Governance) .
- Board leadership: Jay C. Hoag is Lead Independent Director with defined responsibilities (executive sessions, agenda input, coordinating independent directors) .
- Meetings/attendance: The Board met four times in 2024; each director attended at least 75% of Board and committee meetings, except Mr. Hoag (50%) .
- Governance enhancements: Majority voting in uncontested elections, annual director elections starting 2025, elimination of supermajority voting, proxy access (3%/3‑years, up to 20 holders), 20% special meeting right, director resignation policy, outside‑boards limits .
Fixed Compensation (most recent year Hastings was an executive)
| Component | 2024 Amount ($) | Notes |
|---|---|---|
| Base Salary | 100,000 | Executive Chairman salary for 2024, reduced from 2023 |
| Director Cash Fees | — | Non‑employee directors (in 2024) did not receive cash fees other than Ambassador Rice; Hastings was an executive in 2024 |
Director program context (for non‑employee directors): monthly fully‑vested stock options; grant size formula = $25,000 / (FMV × 0.40); no cash fees (Ambassador Rice exception in 2024 moved to options in 2025); program unchanged since 2016 .
Performance Compensation (2024 Executive Chairman)
| Element | Detail | 2024 Terms / Results |
|---|---|---|
| Annual Bonus – Target | $200,000 | 200% of $100,000 salary target rate in 2024 plan |
| Annual Bonus – Metrics | F/X Neutral Revenue (35%); F/X Neutral Operating Margin (65%) | Defined methodology; rigor noted; ARS exclusion noted for targets |
| Annual Bonus – Payout | $400,000 (200% of target) | Certified: F/X Neutral Revenue $38.72B and F/X Neutral Op Margin 26.41% → 200% payout; partial advance paid mid‑2024 |
| RSUs (LTI) | Target value $350,000; 703 RSUs | Granted 1/25/2024; vests quarterly over 3 years |
| PSUs (LTI) | Target value $350,000; target 703 PSUs (threshold 352; max 1,406) | Granted 1/25/2024; relative TSR vs S&P 500; three tranches (1, 2, 3 years); 2024 tranche paid at 200% at 98th percentile |
| Stock Options | 1,112 options @ $468.50 | Granted 1/2/2024 under 2023 program; one‑year vesting for Chair/CEOs |
Performance metric definition table (key mechanics):
- F/X Neutral Revenue and F/X Neutral Operating Margin: calculated using beginning‑of‑year FX rates; excludes certain hedge impacts; margin uses adjusted operating profit and revenue; ARS revenue excluded from targets due to extreme FX .
Change‑in‑Control and Severance Provisions (as of 1/1/2024)
- Double‑trigger (within 3 months before to 24 months after a change in control): cash lump sum equal to 2× (base salary + target bonus), pro‑rata bonus at target, and 24 months of health benefits .
- Outside change‑in‑control protection period: lump sum equal to base salary + target bonus + target annual RSU/PSU opportunity (at target), plus pro‑rata bonus based on actual performance .
- Equity acceleration: 2024 RSUs accelerate in full upon qualifying termination during CoC period/death/disability, pro‑rata acceleration outside CoC; 2024 PSUs have defined pro‑rata/target‑or‑actual acceleration mechanics depending on timing and circumstances; certain options for Hastings subject to 12‑month forward vesting acceleration upon termination without cause .
Other Directorships & Interlocks
| Category | Detail |
|---|---|
| Current public company boards | None |
| Prior public company boards | Facebook, Inc. (2011–2019); Microsoft Corporation (2007–2012) |
| Interlocks | Compensation Committee interlocks: none disclosed for Netflix (general statement) |
Expertise & Qualifications
- Technology and media operator experience; co‑founded and led Netflix for 25+ years; deep product/technology understanding; AI academic background (MSCS) .
- Board skills matrix lists Hastings with leadership, strategy, finance & accounting, entertainment & media, technology, and human capital management experience .
Equity Ownership
| Holder | Beneficial Ownership | Components and Notes | % of Class |
|---|---|---|---|
| Reed Hastings | 4,227,660 shares | Includes options to purchase 2,072,933 shares and 92 RSUs vesting within 60 days; trustee of Hastings‑Quillin Family Trust holding 2,154,241 shares | <1% (“*”) |
Additional outstanding equity (as of 12/31/2024):
- Unvested RSUs: 469 shares (market value $418,029) .
- Unearned PSUs outstanding: 938 shares (market/payout value $836,058) .
- Extensive historical option grants outstanding with various strikes/maturities; most pre‑2024 options fully vested; 1/2/2024 grant of 1,112 options @ $468.50 had one‑year vesting .
Policies relevant to alignment and risk:
- Prohibition on hedging by directors and Section 16 officers (derivatives, collars, swaps, etc.) .
- Clawback policy compliant with Exchange Act Rule 10D‑1 and Nasdaq; performance‑based equity recoveries for restatements .
Governance Assessment
- Positives
- Significant ownership (4.23M shares) and long‑tenured strategic leadership indicate strong alignment with long‑term value creation .
- Pay‑for‑performance strengthened in 2024: shift from options to PSUs/RSUs, rigorous relative TSR metric (55th percentile at target) with 200% payout at 98th percentile; cash bonus tied to F/X Neutral Revenue and Operating Margin, paid at 200% on strong results .
- Modernized severance: adoption of double‑trigger CoC protections and structured equity acceleration; hedging prohibition and clawback policy reduce misalignment risk .
- Independent oversight mechanisms: Lead Independent Director with robust responsibilities; majority voting; annual elections; proxy access; special meeting rights .
- Watchpoints / Potential Red Flags
- Non‑independent Chair with very long tenure may concentrate board influence; mitigation via established Lead Independent Director role and independent committee structure .
- No disclosure of director stock pledging policy; proxy discloses hedging prohibition but is silent on pledging; no pledging by Hastings is disclosed in security ownership .
Notes on related‑party/conflicts:
- No Item 404 related‑party transactions involving Hastings are disclosed; general indemnification agreements in place for directors; a separate 2024 related‑party item pertains to compensation for the daughter of co‑CEO Sarandos (not related to Hastings) .