Reed Hastings, who stepped aside as co-CEO of Netflix in January, and co-chief Ted Sarandos both saw double-digit increases in their compensation packages for 2022, with their total pay topping $50 million each.
Hastings’ total pay last year was $51.07 million, $49.4 million of which was in stock option awards, up 25% from 2021, the streamer disclosed in its 2023 proxy statement Friday. Sarandos’ pay jumped 31.5% in 2022, to $50.3 million, comprising $20 million base annual salary, $28.5 million in stock options and $1.79 million in other compensation (including $1.43 million in residential security costs).
In stepping down as co-CEO, Hastings will take a huge pay cut: For 2023, as executive chairman, he’s eligible to receive a $500,000 base salary plus $2.5 million in stock options. In the co-CEO role, he stood to make $34.7 million this year, mostly in stock.
Greg Peters, formerly chief product officer and COO, was named co-CEO alongside Sarandos. In 2023, Peters will see his compensation package increase from $28.1 million in 2022 to up to $34.65 million as co-CEO ($3 million annual salary, $17.325 million in options and a $14.325 million performance-based target bonus). Sarandos in 2023 is set to receive up to $40 million ($3 million salary, $20 million in options and a $17 million performance-based target bonus).
In the proxy statement, Netflix said that “in response to feedback” from shareholders, the company adopted changes to its executive compensation program for 2023, which includes for Hastings, Sarandos and Peters a minimum 50% allocation to stock options, a salary cap of $3 million, an annual performance-based cash bonus program and a one-year vesting period for stock options.
Netflix said the 2022 annual total compensation for the company’s median employee was $218,400. The estimated ratio of its co-CEOs’ annual total compensation to the median employee’s annual total compensation for fiscal year 2022 was 234:1 in the case of Hastings, and 230:1 in the case of Sarandos.
“We had a bumpy start to 2022 but a brighter finish,” Netflix said in the proxy statement, noting it added about 9 million paid members over the course of the year to stand at 230.75 million worldwide. The streamer generated $31.6 billion in revenue, representing 6% year-over-year growth. Netflix’s stock price, however, declined dramatically in 2022 after its subscriber counts declined in the first half of the year; , shares closed out the year down 51%.
