People with knowledge of the matter revealed that the Chief Operating Officer of Yahoo! Inc. – Henrique de Castro – is about to be dismissed by Marissa Mayer, who is currently the Chief Executive Officer of the company. The reason for the dismissal after 14 months of collaboration is the fact Mrs. Mayer felt disappointed with the Chief Operating Officers efforts to boost growth.
A person who said to have seen the note, but asked not to be identified because it is not public yet, reported that Mrs. Mayer announced her decision in a memo to the companys employees. Another person said that there have been some problems and lack of coordination between the two Chief Executives for more than half an year.
Yahoo! Inc. announced on January the 15th in a filing with the U.S. Securities and Exchange Commission that the departure of the Chief Operating Officer de Castro becomes effective on January the 16th. A replacement for the position was not named by the company.
One of the analysts working for Pivoral Research Group – Brian Wieser – said in an e-mail: “It has seemed that de Castro was hired at a time when the companys senior management was not particularly focused on advertising, and with time it seems that there is both a focus and increasing concern about the absence of a turnaround.”
Henrique de Castro did not respond to requests for comment. Sarah Meron, who is a spokeswoman of Yahoo, refused to make any comments.
Mrs. Marissa Mayer became the Chief Executive Officer of Yahoo! Inc. in July 2012. Since then, she has been focused on making Yahoo more competitive to Google Inc. and Facebook Inc. for users and advertisers by adding some exclusive content and revamping companys products. Under the lead of the Chief Executive Officer Mayer, Yahoo! Inc. has also acquired more than 24 companies, including Tumblr Inc. for more than 1 billion dollars in 2013.
Yahoo has not posted revenue from new products and redesigned e-mail yet. One of the analysts working for S&P Capital IQ – Scott Kessler – commented the situation: “Its negative for Yahoo. This is someone who had a tremendous amount of responsibility. Now, theres a hole in the executive team.”
Henrique de Castro, who has been considered Mrs. Mayers right arm, joined the companys team in November 2012 after working for Google Inc. Yahoo announced that after the dismissal he will receive severance benefits and equity awards in correspondence to his contract.
According to CNN Money, the current share price of Yahoo! Inc. is 0.17% down, and its one-year return rate is 1.56% up. The 28 analysts offering 12-month price forecasts for Yahoo! Inc. have a median target of 37.75, with a high estimate of 49.00 and a low estimate of 26.00. The median estimate represents a -8.08% decrease from the last price of 41.07.
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