Shares of Oracle were off sharply in early trading Friday, less than 24 hours after the company reported earnings that missed Wall Street’s expectations and said that founder Larry Ellison would step down as CEO.

Oracle (NYSE:ORCL) shares were down 5.17 percent, to $39.40, in mid-morning trading.

The slide came on news that Ellison would abdicate as chief executive to take a role in Oracle’s product development efforts. He assumes the title of chief technology officer. Oracle co-presidents Mark Hurd and Safra Catz were named co-CEOs.

Analysts expressed concern over Oracle’s loss of its iconic CEO, and questioned the decision to split the chief executive job between Catz and Hurd. “Rarely is this a good idea,” Morningstar’s Rick Summer told the Wall Street Journal. “There’s probably going to be little change in the short term, but longer term there’s always a question mark over this approach.”

Also weighing on Oracle’s stock was the company’s disappointing earnings report, released after the close of markets Thursday.

Revenue for fiscal first quarter came in at $8.6 billion—up 3 percent from the previous year but below expectations. Analysts surveyed by Thomson Reuters had predicted sales of $8.78 billion.

Earnings per share also came up short. Oracle posted Q1 EPS of 62 cents, below the consensus estimate of 64 cents.

Of concern to investors is whether Oracle, in an era in which the 70-year-old Ellison may play a reduced role, can successfully transition its business software products to the cloud to fend off up-and-comers like Netsuite, Workday and Salesforce.

The value of cloud software was brought home by SAP’s announcement Thursday that it had reached a deal to acquire Concur Technologies, a maker of Internet-based applications for the back office -- for $8.3 billion.

Oracle’s first-quarter cloud revenue grew in double digits, to $475 million. But it remains a small part of the company’s total sales. Total software revenues grew 6 percent, to $6.6 billion, as the key database unit came in with soft results.

Deutsche Bank on Friday downgraded Oracle shares from Buy to Hold. “Coupled with Larry Ellison’s decision to give up the CEO role, our confidence in the core database business is getting tested and we’d prefer to step to the sidelines,” said Deutsche’s Karl Keirstead, in a note to clients.

Also raising flags was Oracle’s weak hardware revenues. Sales of servers and related products were off 8 percent.