The 20-year Netflix veteran will join current chief executive Reed Hastings in the role.
"I am excited to announce that we have appointed Ted Sarandos to be Netflix co-CEO with me, and also elected him to our board of directors. He will continue as our Chief Content Officer. We have also appointed Greg Peters to be our Chief Operating Officer, in addition to his role as Chief Product Officer," Hastings said in a press release.
Hastings said the day-to-day operations of the company will not change.
"Think of Ted's well deserved promotion formalizing how we already run the business today," Hastings said.
Sarandos helped push Netflix to create and then ramp up its original TV shows and movies, such as "Stranger Things," "Orange Is the New Black" and "The Irishman." That's helped cement his legacy as one of the most powerful people in Hollywood.
The news comes along the release of the company's Q2 2020 earnings. Shares dropped more than 12% after hours.