Yahoo Shakeout: CEO Semel Out, Co-Founder Yang In
Yahoo CEO Terry Semel announced his resignation late Monday, ending months of speculation. Semel, who joined the company in 2001, will be replaced by co-founder Jerry Yang. He will remain with company as non-executive chairman and advisor. Susan Decker, previously executive VP, was named president. Earlier in the day, shares surged 3% as rumors of Semel's resignation began to circulate. The stock gained another 4.2% in AH trading to $29.34. Semel has been the subject of shareholder dissatisfaction over the company's lackluster performance, loss of key staff, and his generous compensation package. "Terry Semel lost the confidence of the board... shareholders, and to some extent he lost the confidence of the employees," said Forrester's Charlene Li. 
In a research note, S&P analyst S. Kessler downplayed the news: "Over the past 6 months, Yahoo has now set two major restructurings and experienced sizable management turnover. Without a single wholly new principal announced, we don't necessarily see major changes." On a conference call, Yang hinted that the company would remain independent: "We believe Yahoo can be a vibrant independent company."
Sources: Press release, Wall Street Journal, CNBC, Bloomberg
Commentary: Sell-Side Responses To Semel's Departure From Yahoo • Yahoo Can Use Management Shakeup As Social Search Catalyst • Why Was Jerry Yang Appointed as the New CEO? • Semel's Departure: More Than Meets the Eye
Stocks/ETFs to watch: Yahoo! Inc. (YHOO). Competitors: Google Inc. (GOOG), Microsoft Corp. (MSFT), Time Warner Inc. (TWX). ETFs: Internet HOLDRs (HHH), First Trust Dow Jones Internet Index (FDN)
Conference call transcript: Yahoo! Q1 2007
Related: An audio replay of the conference call can be accessed at http://yhoo.client.shareholder.com/index.cfm or by dialing (888) 286-8010 or (617) 801-6888 #14345291 • Letter from Terry Semel to Yahoo! Board of Directors
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This article has 1 comment:
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Ralph F
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185 Comments
Jun 19 01:46 AM<blockquote>Whil... we think the management change was needed, and a positive step for the company, the news was offset by a modification to guidance for 2Q and 2007. Business appears to mixed for Yahoo! nearly half way through 2007; Panama is tracking ahead of expectations during the second quarter, but the positive search trends is being offset by weakness in Yahoo!'s display ad business and the company's affiliate network. Despite Panama achieving earlier than expected annual double digit gains in revenue per search (RPS), management conceded that overall growth for both the quarter and the back end of 2007 would be between the midpoint and the lower end of the company's revenue and EBITDA guidance range.</blockquote&...