Behind the Money

More Tech CEOs on Hot Seat After Ousters at RIM, Yahoo


Changes at the top at some big technology companies over the past four months—including  Research In Motion on Sunday—have some traders thinking about other underperforming giants in the industry that could use a new leader.

Cisco’s John Chambers, Dell’s Michael Delland Microsoft’s Steve Ballmerare among the tech titans probably feeling the most heat because of underperforming shares and repeated management missteps, traders said.

RIM named Thorsten Heins, formerly a chief operating officer, to chief executive this weekend after its two co-CEOs, Jim Balsillie and Mike Lazaridis, stepped down.

The move followed a 70 percent-plus drop in RIM shares over the last 12 months as the blackberry-maker lost share to Apple and stumbled in the rollout of a tablet computer.

Earlier this month, PayPal’s Scott Thompson was named CEO of Yahoo following the ouster of Carol Bartz. And just last week, the search engine’s founder, Jerry Yang, resigned from the Yahoo’s board. Yahoo shares have plunged over 40 percent in the past five years.

In September, Hewlett-Packard replacedLeo Apothekarwith former EBay CEO and California gubernatorial candidate Meg Whitman after the former SAP executive missed earnings three quarters in a row. Shares of the tech conglomerate are down by a third in five years.

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Cisco’s Chambers “championed a shopping spree in the consumer space over the last 10 years which he now admits is a failure by agreeing to shut it down or sell it in pieces,” said Eric Jackson, president of Ironfire Capital. “He used to be a CEO rock star, but he's clearly been a CEO dud for the last 5 years, if not more.”

Shares of Cisco are off 32 percent since early 2007 because of misplaced forays by the router maker into consumer digital video and video teleconferencing. The Technology SPDR ETF is up 13 percent over that same period.


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Dell’s stock is down 37 percent in five years, right around the time that founder Michael Dell returned to run the company. Since then Dell has expanded further into servers and even took a shot at a music player.

After the changes at H-P, “Michael Dell is up against it here,” said Jon Najarian, co-founder of “He'd be my pick to have shareholders angry and bailing.”

The most controversial name that seems to always come up in these conversations is Microsoft’s Steve Ballmer. While underperforming the tech sector as a whole, the maker of software, search engines and video game consoles is down a less shocking 5 percent over the last five years. Microsoft shares are also on a bit of a run lately, up five percent this year alone.

“Ballmer might be saved by the recent rally in Microsoft and the XBox, which is doing well,” said Scott Nations of NationsShares. “Let’s face it, the best thing to happen to Microsoft in the past 10 years was not buying Yahoo and that's not for Ballmer's lack of trying.”

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