Schwab Says Sayonara to CEO
Charles Schwab and Company's spotty performance in a volatile stock market has prompted its board of directors to bid farewell to CEO David S. Pottruck, who has worked at the discount brokerage for 20 years.Shortly after announcing disappointing earnings for the quarter ended June 30, 2004, Charles Schwab and Company announced that David S. Pottruck, who has served as CEO since January 1998, has resigned. Former CEO Charles Schwab will retake the corporate reins and continue to serve as board chairman. "During his two decades here at Schwab, David has been a valued partner to me and has worked tirelessly to help this Company pursue its vision," Mr. Schwab said. "As I see the opportunities ahead for Schwab, I want to underscore my confidence in the strength of our franchise, the value we provide our clients, the dedication of our employees, and the depth of our management team." The company said Schwab, 66, will remain its CEO indefinitely. For the quarter ended June 30, 2004, Schwab posted earnings of $113 million, down from $126 million for the second quarter of 2003 and well off the $161 million posted for the first quarter of 2004. For the first half of 2004, thanks to the strong first-quarter showing, the Companys net income was $274 million, compared with $197 million earned during the same period in 2003.
Christopher Dodds, Schwabs chief financial officer, said that Schwab continues to work to reduce its annual expenses by $150 million to $200 million annually. Dodds told analysts during a conference call Tuesday that job cuts will continue during this phase of cutting costs; the company has eliminated more than 10,000 jobs since its revenue peaked nearly four years ago.