Yahoo! Inc. stocks were down 28 cents during mid-day trading on Tuesday, a day after Terry Semel resigned as CEO and was replaced by Jerry Yang.
The Internet search engine’s stocks were going for $27.84.
Semel stepped aside – likely with pressure from the board of directors, analysts say – to make way for Yang, a Yahoo! co-founder known for technical, rather than managerial, experience. Semel will become a non-executive chairman at Yahoo! He has come under fire for failing to position Yahoo! as a top challenger to Google Inc., especially as Yahoo!’s financial performance has not met investor expectations.
Semel began serving as CEO in May 2001. Yang now oversees daily operations, and Susan Decker, formerly head of advertising and publishing for Yahoo!, has been named president.
“This has a ring of inevitability about it,” said David Bradshaw, a principal analyst for research firm Ovum. “Something has to give in the combination of a relatively under-performing company and a CEO who is reportedly one of the highest paid in corporate America.”
Bradshaw added that he doesn’t expect the leadership change to produce “any sort of quick fix.”
“Yahoo has to conduct a through strategic review. Long-term, it has to find a way of getting a better return from its diversity. Being just a pale shadow of Google is not an option,” he said.
Google Inc. www.google.com
Ovum www.ovum.com
Yahoo! Inc. www.yahoo.com
