Yahoo Inc Chairman Roy Bostock fired CEO Carol Bartz over the phone on Tuesday, ending a tumultuous two-year tenure marked by stagnating growth and a rift with Chinese partner Alibaba.
I am very sad to tell you that I've just been fired over the phone by Yahoo's Chairman of the Board. It has been my pleasure to work with all of you and I wish you only the best going forward, Bartz said in a two-sentence email to employees obtained by Reuters.
Chief Financial Officer Tim Morse will step in as interim CEO, according to a statement from Yahoo, which said on Tuesday that Bartz had been removed from her role. Yahoo said it would begin a search for a new, permanent CEO.
Bostock voiced his public support in June for the CEO, a lightning rod for criticism from Wall Street, and known for her tough attitude and salty language.
Shares in the company jumped more than 6 percent in after-hours trade to $13.72, from a close of $12.91 on the Nasdaq. The stock was trading around $12 in January 2009, when Bartz joined Yahoo, hoping to engineer a turnaround for a company then slowly ceding market share.
In January 2000, near the end of the dot-com bubble, the stock traded at more than $125 a share
Yahoo remains one of the most popular destinations on the Web, but the company is facing increasing competition from social networking service Facebook and continuing pressure from search leader Google Inc.
WHITHER THE GROWTH?
The Internet company reported a slight decline in net revenue in the second quarter, as efforts to restructure its sales force caused disruptions.
Research firm eMarketer has projected that Facebook would overtake Yahoo this year to collect the biggest slice of online display advertising dollars in the United States.
Management and the board also came under fire after the company's handling of its relationship with China's Alibaba Group, in which Yahoo owns a stake of roughly 40 percent.
The rocky relationship between the companies came to a head in May when it was revealed that Alibaba had abruptly handed Alipay -- one of Alibaba's crown jewels -- to a company controlled by Alibaba founder Jack Ma, apparently without Yahoo's knowledge.
The news of Bartz's ouster was first reported by tech blog AllThingsD.
Carol Bartz was brought in to try to organize and streamline the company and frankly she's been able to do that. However, Yahoo is going to need a little bit more than organization and streamlining, said Michael Yoshikami, CEO at fund management company YCMNET Advisors.
They are going to need a vision of what they want to be in the future. And I don't think investors really understood what that clear vision was.