In an effort to pacify restless investors, Yahoo! chairman and chief executive Tim Koogle has abandoned the latter role and will seek a replacement.
The news followed hard on the heels of Yahoo's revelation that a sharp decline in ad revenues will drive the formerly profitable internet portal to, at best, break-even performance in the current quarter.
Executive search consultants Spencer Stuart & Associates have been charged with finding a new ceo, exacerbating market disquiet at the absence of an immediate successor. There are also rumours of boardroom dissent over the portal's strategic direction.
Yahoo! chief financial officer Susan Decker warned that revenues this quarter will range between $170m and $180m – versus analysts’ averaged forecasts of $232m. This would lead to break-even on an EBITDA (earnings before interest, taxes and amortization) basis, compared with earlier net earnings expectations of $28.25m.
Meantime, potential predators are circling and there is concern that Yahoo! could fall prey to a hostile takeover. Co-founder Jerry Yang has already expressed worry that the company is highly vulnerable while the ceo’s chair remains untenanted.
This, together with the recent rash of senior management defections, could explain Yahoo’s decision last week to insert a ‘poison pill’ into its shareholding structure [WAMN: 2-Mar-01].
News source: Financial Times