San Francisco: Yahoo Inc. named technology veteran Carol Bartz as its new chief executive on Tuesday, bringing in a no-nonsense leader known for developing a clear focus something that has eluded the struggling Internet company during a three-year slump.
The decision to lure Bartz, 60, from software maker Autodesk Inc. ends Yahoo’s two-month search to replace co-founder Jerry Yang, who surrendered the CEO reins after potentially lucrative deals with rivals Microsoft Corp. and Google Inc. both collapsed.
After describing herself as a straight shooter, Bartz told analysts in a conference call that she intended to ensure Yahoo gets “some friggin’ breathing room” so the company can “kick some butt.” She said it would be presumptuous to share her vision for Yahoo on her first day on the job.
“I wouldn’t have taken the job if I didn’t believe there was a huge opportunity here,” Bartz said before she had to hustle off to her first meeting with Yahoo’s top managers.
After a tepid early reaction, investors seemed to warm up to Bartz’s appointment. Yahoo shares fell 12 cents Tuesday to close at $12.10, then recovered 47 cents, almost 4 percent, in extended trading.
Bartz’s appointment could set the stage for Microsoft to renew its efforts to buy Yahoo’s Internet search operations as a way of mounting a more serious threat to Google, the market leader. Microsoft had been reluctant to deal with Yang because he rebuffed several previous overtures, including a $47.5 billion offer to buy Yahoo in its entirety last May.
Microsoft subsequently withdrew that bid, valued at $33 per share. Yang had hoped to placate shareholders by using Google’s superior technology to sell some of the ads alongside Yahoo’s search results, but that idea unraveled in November after antitrust regulators threatened to block the deal.
Yahoo’s decision to bring in an outsider apparently irked its president, Susan Decker, who also was a candidate for the CEO job. She now plans to resign after a transitional period. Both Decker and Bartz are on Intel Corp.’s board of directors.
“We are very confident (Bartz) is the right leader to get Yahoo back on track and help the company achieve its full potential,” Yahoo Chairman Roy Bostock said.
Bartz’s track record indicates she will move quickly to build upon Yahoo’s strengths while doing her best to shed the weaknesses.
Forrester Research analyst David Card said Yahoo desperately needs someone to crack the whip after years of drifting aimlessly despite having a vast online audience, which it touts as 500 million people worldwide.
Bartz spent nearly 17 years at Autodesk, which specializes in making design software for architects and engineers. She was the San Rafael-based company’s CEO from 1992 until 2006, when she stepped aside to become executive chairman a job that paid her a $500,000 salary. Yahoo didn’t immediately disclose her new compensation package.
While Bartz was CEO, Autodesk’s annual revenue ballooned from nearly $300 million to $1.5 billion. Perhaps more importantly to Yahoo’s long-suffering shareholders, Autodesk’s stock price rose by an annual average of nearly 20% during Bartz’s reign, beating the 10.6% annual average for the Standard & Poor’s 500 index.
Bartz had established her management chops in nine years at Sun Microsystems Inc., where she eventually became the No. 2 executive behind the server maker’s then-CEO, Scott McNealy. She also has worked at Digital Equipment Corp. and 3M.
Despite Bartz’s resume, she will likely face questions about whether she is a good fit at Yahoo because she lacks any background in advertising the primary source of Yahoo’s income.
Yahoo also is far larger than Autodesk, with annual revenue of more than $7 billion and roughly 13,000 employees, nearly twice the size of Autodesk’s work force.