Here's How Much Netflix CEOs Ted Sarandos, Reed Hastings Will Make In 2022

Streaming giant Netflix Inc NFLX operates with two co-CEOs. A new report from Variety shows how much the CEOs will be paid in 2022 for leading the company.

What Happened: Netflix co-CEO Ted Sarandos, who joined the company in 2000, is set to be compensated $40 million in 2022. Sarandos will be paid a salary of $20 million for 2022, the same amount he was paid in 2021. Sarandos will also receive stock options in Netflix valued at $20 million.

Netflix co-CEO and Chairman Reed Hastings, who is one of the co-founders of the company, has a compensation package of more than $34 million in 2022. Hastings will have a salary of $650,000 in 2022, the same one he received in 2021. The stock options Hastings is slated to earn in 2022 are valued at $34 million.

Netflix COO and Chief Product Officer Greg Peters will receive compensation of $24 million in 2022, composed of $16 million in salary and $8 million in stock. Peters had a salary of $12 million in 2021.

According to the report, Netflix pays employees base salary and stock options for compensation.

“We do not use performance-based bonuses as we believe that they tend to incentivize specific, typically short-term focused behavior rather than encourage long-term stockholder value creation,” Netflix said in a proxy statement earlier this year.

Related Link: Here Are The Top 10 Most Watched Movies On Netflix Of All Time 

Why It’s Important: Sarandos was named co-CEO of the company in July 2020.

“We explained that the dual CEO model formalized the prior working relationship between Reed and Ted and was an effective leadership model to further support our continued growth and international expansion,” the company said in a proxy statement on the two CEOs.

Netflix has had a strong 2021 in terms of its share price and subscriber growth, which could help justify the compensation paid to top executives.

Netflix reported third-quarter revenue of $7.48 billion, up 16% year-over-year. The company has beat Street estimates for revenue in eight straight quarters, according to Benzinga Pro.

Netflix reported it added 4.4 million net new subscribers in the third quarter. The company could be in for strong fourth-quarter for subscriber growth with the hit series “Squid Game” being released near the end of the third quarter and generating strong word of mouth.

“A mind-boggling 142 million member households globally have chosen to watch the title in its first four weeks,” Netflix said of “Squid Game” in its third quarter report.

Netflix also highlighted its fourth quarter as having a strong slate of content including new seasons of “The Witcher,” “You,” “Tiger King” and Cobra Kai.”

Netflix is guiding to fourth-quarter net subscriber growth of 8.5 million and revenue of $7.71 billion.

“We’re very excited to finish the year with what we expect to be our strongest Q4 content offering yet.”

Netflix is seeing strong market share for U.S. consumers compared to rivals. Netflix reported a 6% market share for U.S. TV time in the third quarter. Rivals Hulu, Amazon.com Inc AMZN and Walt Disney Co DIS had market share of 3%, 2% and 1%, respectively. YouTube, an Alphabet Inc GOOGGOOGL unit, was tied with a 6% market share.

Share Performance: Netflix shares are up 12% year-to-date. NFLX shares are up 378% over the last five years and up over 5,800% in the last ten years.

Many of Netflix’s rivals are media companies rather than pure-play streaming companies. Disney shares are down 17% year-to-date in 2021. Disney shares are up 43% in the last five years and 316% in the last 10 years.

AT&T Inc T, which operates as a telecommunications company and media company, has seen shares drop 15% year-to-date. T shares are down 42% in the last five years and down 16% in the last ten years. AT&T is the owner of the HBO Max streaming platform.