Netflix’s chief financial officer David Wells is stepping down after more than seven years in the role.
Mr Wells, who has been at the video streaming group since 2004 and CFO since December 2010, will stay with the company until a successor takes the reins. Netflix would consider both internal and external candidates for his replacement, it said.
Since Mr Wells took over from predecessor Barry McCarthy, who led Netflix’s initial public offering in 2002, the company’s share price has increased by more than 1,000 per cent, with subscribers rising from 20m at the end of 2010 to more than 130m in the most recent quarter.
Mr Wells has presided over Netflix’s huge investment into original content, now running at $8bn a year, as well as taking on substantial debt to finance it. His 14 years at the Silicon Valley-based online video company recently included a two-year posting in Amsterdam, to help develop its European expansion.
“After discussing my desire to make a change with Reed [Hastings, chief executive], we agreed that with Netflix’s strong financial position and exciting growth plans, this is the right time for us to help identify the next financial leader for the company,” Mr Wells said in a statement on Monday.
Mr Wells, 47, said he wanted the next chapter of his life to focus more on philanthropy, but was also interested in “big challenges”.
Netflix shares were hit last month after the company revealed it added 1m fewer subscribers than expected during its second quarter and issued a conservative outlook for the current quarter.
It expects free cash outflows of as much as $4bn for 2018 and said it would continue to finance its spending on content through debt rather than by tapping equity markets.
The company blamed its own internal forecasting errors for the disappointment, which was its biggest miss in two years.
Netflix shares are down 17 per cent from their record high in early July but are still up by about 70 per cent in the year to date. The stock was down about 1 per cent on Monday after news of Mr Wells’ planned departure.
To fuel its push into original shows, which began in earnest with the release of House of Cards in 2013, Netflix has taken on more than $8.3bn in long-term debt, as of the most recent quarter. At the end of June, the company had $18.4bn in total streaming content obligations, including both licensed and original TV shows and movies. The final season of House of Cards is expected to air in November.
According to Netflix’s annual proxy statement in April, Mr Wells was due to be paid $2.8m this year, including an annual stock option allocation then worth $2.5m. His total remuneration in 2017 reached $5.2m.
“David has been a valuable partner to Netflix and to me,” Mr Hastings said in Monday’s statement. “He skilfully managed our finances during a phase of dramatic growth that has allowed us to create and bring amazing entertainment to our members all over the world while also delivering outstanding returns to our investors.”