![]() “I don’t think there’s a single right answer to any CEO transition,” Andrews said. Such changes happen periodically in a software company’s life cycle. So that’s why there’s a bunch of questions around it.” No right answer to CEO switchīut “it’s hard to say” whether Splunk should have handled the situation. “So what was surprising about this is that they didn’t actually have somebody lined up to be the next CEO. ![]() “When you (as a company) are making a CEO change, typically, you have somebody else lined up, so you’re able to announce who the successor is at the same time,” Andrews said. But, the analyst added, Splunk’s directors gradually realized that it’s difficult to go from $1bn to $3bn to $10bn in revenue, and they might need a CEO with a different skill set who has been able to expand companies to that size. Merritt did not engage in bad behaviour, and there was “nothing wrong” with Splunk’s second-quarter results, either. So that’s why I think there’s heightened focus around this particular call.”Īndrews said his understanding is that nothing nefarious went on behind the scenes. “The earnings call will be the first time the broader Splunk management team addresses what’s happened in a public forum. “(Merritt’s resignation) is confusing people,” Andrews said. Smith is also continuing to serve as chair. (Before becoming CEO, he served as senior vice president of field operations.) Merritt has remained with the company in an advisory role to smoothen the transition to a new CEO.īoard chair Graham Smith, a former Salesforce CFO, is serving as interim CEO until a permanent replacement is hired. Merritt noted that Splunk has increased its revenue to nearly $3bn from $302m when he joined the company eight years ago. In a news release, Merritt attributed his resignation to the company’s need to identify a leader with a proven track record in scaling up operations and growing multi-billion-dollar enterprises. The company is best known for its security information and event management (SIEM) software, which collects IT infrastructure data to give systems administrators and IT security professionals a better idea of what’s happening with their systems. The stock was down more than 2.8% at midday Tuesday 30 November on the Nasdaq Global Select Market. Splunk’s stock price declined on Merritt’s 15 November resignation and has struggled since then. “To the extent that there are questions and concerns, the stock may languish here in the short term.” Stock struggling “If people feel comfortable with those two (key issues), then I would expect the stock to start to rebound,” he said. Investors and analysts also want to better understand how the company is evolving to a cloud-based system from an on-premise service, Andrews added. More scrutiny than usualĪndrews said Splunk is facing more scrutiny than usual due to uncertainty surrounding former CEO Doug Merritt’s sudden resignation in mid-November. Splunk will release its earnings report and hold a follow-up call with analysts on Wednesday 1 December. And, what are the next milestones that analysts and investors should look out for?” The second thing is just providing visibility on where we are in this business-model transition. “I think, first and foremost, they have to provide some background on the CEO change, why it happened, and why at this point,” Jack Andrews of Needham & Company told on Monday 29 October in an interview. Investors are seeking answers from Splunk on the resignation of its CEO and business-model transition as the US software company prepares to deliver its quarterly earnings report, said a leading analyst. Das in October 2003 and is headquartered in San Francisco, CA.Splunk investors are seeking answers on why the company CEO resigned, says a leading analyst. The company is generated by both machine-to-machine as well as human-to-machine interactions. Its machine data can be found in a variety of formats such as application log files, call detail records, click stream data associated with user website interactions, data files, system configuration files, alerts and tickets. The applications, servers, network devices, desktop and laptop computers, mobile devices and various other systems that organizations have deployed to support their operations continuously generate information relating to their status and activities. ![]() The company's machine data is generated by software applications, information technology infrastructure, electronic devices and systems. Its software collects and indexes data at massive scale, regardless of format or source, and enables users to quickly and easily search, correlate, analyze, monitor and report on this data in real time. provides software platform that enables organizations to gain real-time operational intelligence by harnessing the value of their machine data.
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