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article imageNetflix CEO Hastings sees stock option slashed by 50%

By Leigh Goessl     Dec 23, 2011 in Business
Netflix chief executive officer Reed Hastings has had a rough year.
The once flourishing DVD direct mailing and movie streaming company has seen a massive loss of customers, decreased value in stock and a dismal 2012 prediction in terms of profitability.
Now Netflix has cut the annual stock-option allowance for Reed Hastings from last year's $3 million to $1.5 million reported Bloomberg's Business Week.
According to a regulatory filing, the stock option allowance has changed, but the Netflix CEO will receive a salary of $500,000 in 2012; his salary is unchanged.
The Associated Press (courtesy of Washington Post) points out that "it would have been difficult" to make a case for Hastings to see any increase next year after this past year's disastrous business decisions and subsequent stock price plunges. Netflix stock has dropped substantially since July.
AP reported "Netflix’s stock gained $2.87 Thursday to close at $73.84, down from its July high of just under $305."
In September, Digital Journal reported the mass exodus of customers. In October it was reported 805,000 customers abandoned the movie delivery service during 2011's third quarter. It is also speculated many more consumers ended their subscriptions, however fourth quarter results are not expected to be released until sometime next month.
With an already predicted dismal 2012 where profits are concerned, it comes as no surprise that Hastings is not only seeing a reduction in stock-allowance, but also no increase in salary.
Media sources all state Netflix has declined to comment on Hastings' terms.
“We don’t comment on board decisions or executive compensation,” said Steve Swasey, a Netflix spokesman.
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