Outlook: Off the hot seat
A little over a year ago, Hastings' position as CEO of Netflix (NFLX) looked to be in serious peril. A change to the pricing structure in summer 2011 that effectively doubled the subscription cost for many users caused a decline in subcribers, and that was followed shortly thereafter by a boneheaded (and short-lived) attempt to spin off the DVDs-by-mail portion of the business into a new company called "Qwikster." Netflix also lost the streaming rights to Disney movies after failing to renew its agreement with Starz. The end seemed near for Hastings.
And then Netflix started to pull out of its nosedive. The company regained millions of subscribers in the first quarter of 2012, and recently bypassed Starz to regain the rights to Disney's theatrical releases. The stock has seen solid growth in the last three months.
That's not to say that the Hastings' troubles are behind him. Despite the recent rally, the company's share price has been a roller-coaster ride in 2012, and at one point the board had to adopt a "poison pill" to fend off a possible takeover bid by Carl Icahn. More recently, Hastings found himself the subject of an SEC investigation over improper disclosures, and Netflix users howled after an outage at the company's Amazon-hosted servers knocked out the service on Christmas Eve. And of course, the company faces increasing competition in the streaming game from Amazon Prime and Redbox Instant.
So Hastings isn't out of the woods. But it's been awhile since we've heard serious talk of his ouster, and the company seems to be headed back in the right direction.