Reed Hastings Quits the Microsoft Board of Directors
Microsoft Corp. (NASDAQ: MSFT) may have been glad to have originally had Reed Hastings, the founding CEO of Netflix Inc. (NASDAQ: NFLX), on its board of directors. Unfortunately, Mr. Hastings has made some bad leadership decisions and Netflix shares have destroyed billions of dollars in shareholder value due to those key missteps. Now comes news that Hastings will not seek the re-election to Microsoft's board of directors.
Is it fair to ask if Hastings was 'eagerly dissuaded' from staying on the Microsoft board of directors? Is it fair to ask if being on Microsoft's board was just too demanding for a CEO who some think is in over his head? Either way, Mr. Hastings will continue to serve on the Microsoft board through the company's November shareholder meeting. The report says that Reed Hastings has decided that he will not seek re-election to the board of Microsoft. He was quoted saying, "I've decided to reduce the number of boards I serve on, so that I can focus on Netflix and on my education work." We will leave the rest up to you.
Hastings currently serves as the lead independent director on the Microsoft board and today's announcement says that the board will appoint a new lead independent director at that time.
Hastings is fifty-one and he joined the Microsoft board in March 2007. He currently serves on the boards of Netflix, Facebook, Microsoft, Dreambox Learning, the Knowledge Is Power Program, and the California Charter Schools Association.
We would not expect any major move from this news alone for Microsoft shares nor for Netflix shares, but it is interesting to see what happens when CEOs fall from popularity so much. That being said, Netflix had two bits of bad news today as the company's credit rating was put on a downgrade watch by Moody's and its stock was downgraded to Underperform at BofA/Merrill Lynch.
JON C. OGG