Netflix gets SEC notice over CEO's Facebook post
NEW YORK (AP) - Netflix says it is facing scrutiny from government regulators over a Facebook post made by CEO Reed Hastings in July.
The company disclosed Thursday that the Securities and Exchange Commission sent notices to Netflix Inc. and Hastings regarding the July 3 public post on Hastings' account. The SEC sent "Wells Notices," giving Netflix and Hastings a chance to argue why the agency should not take action against them.
On July 3 Hastings wrote on Facebook that monthly viewing on Netflix had exceeded 1 billion hours in June. The SEC says that is material investor information that must be disclosed in a regulatory filing or press release. The company says the information isn't material because a few weeks earlier it disclosed on its blog that subscribers were viewing almost a billion hours of content per month. That announcement also was not announced in a press release or an SEC filing.
Shares of the Los Gatos, Calif., company jumped 13.4 percent on July 5.
Hastings responded to the notices with a post on Facebook that was also filed with the SEC, calling it a "fascinating social media story."
Netflix shares rose $2.80, or 3.4 percent, to $86.17 on Thursday after the company announced a multi-year licensing deal with Disney. The stock fell $1.39 to $84.78 in after-hours trading.
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