By Joe Flint and Micah Maidenberg

Netflix Inc., the company at the forefront of remaking entertainment, promoted the architect of its programming strategy to the role of co-chief executive as it reported that the shelter-in-place world garnered it another 10.1 million subscribers in the second quarter.

The elevation of Ted Sarandos, 55 years old, to the role of co-CEO puts him in position to eventually succeed Netflix Chairman and Chief Executive Reed Hastings, 59.

"This change makes formal what was already informal -- that Ted and I share the leadership of Netflix," Mr. Hastings said in a letter to shareholders.

Jay Hoag, the lead independent director of Netflix, said: "The board and I are confident this is the right step to evolve Netflix's management structure so that we can continue to best serve our members and shareholders for years to come."

In a blog post to staff announcing the move, Mr. Hastings wrote: "Ted drove the revolution in our content strategy, which was way ahead of its time and has been key to our continued success. It was typical of his ability to see where the industry -- and consumer tastes -- are headed."

Netflix has gained more than 26 million subscribers in the last two quarters, helped by a thirst for entertainment when sports and most content production have been shut down. The 10.1 million net new subscribers it reported Thursday surpassed the 7.5 million Netflix had projected for the second quarter earlier this year. But the increase was less than the company's gain for the first quarter, when it added about 16 million customers as economies and people began locking down amid the spread of the coronavirus.

The appointment of Mr. Sarandos is indicative of the integral role he has played in Netflix's meteoric growth over the last decade. As chief content officer, he has been the architect of the streaming service's hugely successful original-programming strategy. Not only has Netflix become the most prolific producer of content, it is also a regular contender for Academy and Emmy awards.

Mr. Sarandos has also been elected to the board of directors and will continue to serve as chief content officer. Meanwhile, Greg Peters, Netflix's chief product officer, is adding the role of chief operating officer to his responsibilities. "We want Greg to help us stay aligned and effective as we grow so quickly around the world," Mr. Hastings said in the letter.

In his new role, Mr. Peters will work closely with Mr. Hastings in expanding Netflix's international operations and further aligning the company's overseas and domestic strategies.

Naming Mr. Sarandos co-CEO, with both he and Mr. Hastings reporting to the company's board, likely means there will be little palace intrigue when it comes to succession. No leadership change is expected soon though, as Mr. Hastings said in the blog post that he would guide Netflix through the next decade.

"These changes are part of a long process of succession planning," Mr. Hastings said in the post. "While transitions can be hard, I am optimistic because we have a well established culture that's built to be flexible and many years to get good at this."

Among the popular original content in the second quarter, Netflix said, were the young-adult comedy series "Never Have I Ever" produced by Mindy Kaling and the movies "Da 5 Bloods" from director Spike Lee, the action film "Extraction" starring Chris Hemsworth and the comedy "The Wrong Missy" with David Spade.

Netflix said its 2020 release schedule remains mostly in place despite the havoc the pandemic has wreaked on the entertainment industry. The company produces content far in advance of its traditional broadcast and cable rivals, and doesn't expect to be slowed until midway through 2021. Even then, the company said it anticipates releasing more originals in 2021 than in 2020.

While some parts of the world are opening up in terms of production, including the Asia-Pacific region, there is still uncertainty as to when the content machines in the U.S. will get up and running again. Netflix and other entertainment companies have been hoping to resume production later this summer, but the company warned that "current infection trends create more uncertainty for our productions in the U.S."

The Los Gatos, Calif.-based company said it ended the second quarter with a total of more than 192.9 million paying subscribers, up from 182.9 million as of the first quarter and 151.6 million a year earlier.

The company has benefited from heightened demand for television shows, movies and other forms of content that can be streamed at home as the pandemic forces changes in consumer behavior. People in many markets have stayed at home as movie theaters have shut down, sports leagues have delayed competition and entertainment venues have canceled concerts.

"We saw significant pull-forward of our underlying adoption leading to huge growth" during the first two quarters of the year, the company said.

However, Netflix said it expects less growth for the second half of 2020. It anticipates adding 2.5 million net new subscribers in the third quarter, down from a gain of 6.8 million in the year-ago period.

Shares fell 10% in after-hours trading. The stock has been one of the strongest performers in the S&P 500 in 2020 and ended Thursday up 63% so far this year.

For the second quarter, Netflix said it added 2.8 million subscribers in the region including Europe and the Middle East, 1.8 million in Latin America and 2.7 million in Asia.

The company reported more than 2.9 million new subscribers in the U.S. and Canada for the second quarter, up compared with a gain of 2.3 million in the first quarter.

Netflix is facing more competition for viewers in North America. Comcast Corp.'s NBCUniversal earlier this week launched its Peacock streaming service, following AT&T Inc.'s HBO Max, which became available in May. Walt Disney Co. and Apple Inc. also have their own streaming platforms.

Netflix reported second-quarter revenue of $6.15 billion, up from $4.92 billion a year earlier. Analysts expected Netflix to generate $6.08 billion in revenue for the latest quarter.

Profit rose to $720 million, or $1.59 a share, from $271 million, or 60 cents a share, the year earlier. Analysts had expected $1.82 a share, according to FactSet.

Write to Joe Flint at joe.flint@wsj.com and Micah Maidenberg at micah.maidenberg@wsj.com