SAN JOSE, Calif. — Yahoo Inc. searched for a new chief executive officer for more than three months, but finally landed on an executive who worked just a few miles away — PayPal President Scott Thompson.
Sunnyvale, Calif.-based Yahoo announced Wednesday that the San Jose online-payments company’s leader will take the chair vacated by Carol Bartz, whom Yahoo fired in September after a disappointing two-and-a-half-year stint.
Since that firing, Yahoo has been investigating selling all or part of the company in order to bring in cash, both to improve the bottom line and return some cash to shareholders, who have seen their equity drop steadily for years.
Roy Bostock, chairman of Yahoo’s board of directors, said in a conference call Wednesday morning that Thompson will be expected to help the company return to its former industry-leading position while ensuring advertising dollars continue to flow.
Thompson will “restore the energy, the focus and the momentum necessary to grow the core business,” Bostock said, later adding that the new CEO “knows how to reach out to customers, find out what they need and what they want, and he will do that with our advertisers.”
Yahoo lost its display advertising crown to Facebook in 2011, and has also been losing market share to fast-rising Google in the competitive and lucrative field, according to analytics firm eMarketer.
Thompson focused on Yahoo’s strong employee base and possibility for growth in his pledge to “deliver Yahoo’s next era of success.”
“Yahoo is an industry icon, and its people represent one of the great teams in the online world,” Thompson said in Wednesday’s conference call, later adding that “there’s a wealth of talent inside this organization, and its talent respected in the valley.”
Thompson was PayPal’s chief technology officer and senior vice president before being named president in January 2008. Before joining the company, which is wholly owned by eBay Inc., he was executive vice president of technology solutions at Inovant, a subsidiary of Visa, and chief information officer for Barclays Global Investors, according to a Yahoo news release.
Thompson will now manage Yahoo through some possible large changes, as Bostock said that the review the company is undergoing, which has reportedly included taking bids from outside firms for all or part of the company, is ongoing.
“Whatever alternatives we are looking at as part of our comprehensive review, there will be no slowdown and no delay in our process,” Bostock said.
Yahoo is reportedly considering bids from at least two groups, including one led by Silver Lake, Microsoft Corp. and Andreesen Horowitz. In addition, Chinese Internet leader Alibaba is considering making a bid for all of Yahoo, which owns 40 percent of the Asian company.
Brett Harriss, an analyst at Gabelli & Co., told Bloomberg News that Thompson’s hire makes it more doubtful that Yahoo will be sold in its entirety.
“Hiring a new CEO makes the sale of the whole company unlikely,” he told Bloomberg on Wednesday.
Bostock and Thompson mentioned growing shareholder value several time in this conference call, as the company’s share price continues to struggle. Thompson said one of his top goals will be “growing shareholder value and top-line growth of the business.”
Bostock admitted that Yahoo’s growth has been stagnant, but said he expects Thompson to energize the company.
“We have treaded water here, and what we need to do is start swimming again at a very fast clip,” he said.
Tim Morse has been serving as interim CEO since Bartz was fired in September, but will return to his previous role as chief financial officer when Thompson officially takes over Monday.
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