Symantec the Latest IT Corporation to Change CEOs
Symantec became the third major Silicon Valley IT corporation in 10 days to make a change at the top of its leadership July 25 when it replaced CEO Enrique Salem with board chairman Steve Bennett, himself a former CEO of Intuit.
Yahoo named former Google Senior Vice President Marissa Mayer as its new CEO on July 16, and VMware followed the next day by naming EMC Senior Vice President Pat Gelsinger as its new chief executive.
Symantec, which also announced its quarterly earnings on July 25, explained through new board director Dan Schulman that the move was made because the company was "underperforming against the current challenges of the markets."
Enrique Salem, 46, worked two stints at Symantec for a total of 19 years, including the last three as CEO after replacing longtime CEO John W. Thompson, now CEO at Virtual Instruments.
Investors Apparently Agree
Investors apparently agreed with the move. Symantec stock shares moved up 17 percent, the biggest one-day gain in more than 10 years for the company. Shares of common stock were selling for $15.05, up $1.89, at noon July 25.
My view is that Symantecs assets are strong and yet the company is underperforming against the opportunity, Bennett, 58, (pictured at left) said on a conference call with analysts. Im looking forward to working with the team to build upon the significant assets in place to help Symantec accelerate value creation for all of its stakeholders.
Symantec, which with its Norton brand is No. 1 in personal securityware market share, nonetheless has seen its stock price fall by 16 percent in 2012 against increasingly tough competition from companies such as Intel/McAfee, Kaspersky, IBM, EMC, Cisco Systems and Hewlett-Packard. Profits also have been lessening.
As time goes on, Symantecs $10.2 billion purchase of data storage maker Veritas Software in 2005 is increasingly viewed as a mistake. Symantec has never been able to move the needle much against EMC, NetApp, IBM, Dell and others in the storage software market.
An Unusual Introduction
Salem (pictured at right) was well known in storage circles for the initial splash he made in April 2009, when he took over for Thompson as the new CEO.
In April 2009, on his fourth full day as the freshly minted chief executive officer, Salem made a memorable entrance at Storage Networking World in Orlando, Fla. He stepped up to the podium and declared: I want you to stop buying storage. Now!
You heard me right: Stop buying storage, Salem said. How? Reduce the amount of information that you store in the first place, and make the storage you do have more flexible and efficient.
At first glance, it seemed as if Salem was ordering a few thousand IT managers, partner companies and software developers to not buy something his company sells. Of course, Symantec is a software company that doesnt sell storage arrays, controllers or much hardware at all (although there are options to buy appliances with certain software packages).
So, in terms of literally not buying physical storage, Salem could get away with the apparent meaning of that statement and still retain credibility with the companys customers and shareholders. But taken off the top, this was a rather surprising way to say hello to the industry.