stock is trading sharply lower Friday after the company announced a management shuffle that included the surprise departure from the company of IBM President and former Red Hat CEO Jim Whitehurst.
IBM CEO Arvind Krishna said in a statement that Whitehurst “has been instrumental in articulating IBM’s strategy, but also, in ensuring that IBM and Red Hat work well together and that our technology platforms and innovations provide more value to our clients.” He will remain a “senior advisor” to IBM’s executive team.
The company provided no specific reason for Whitehurst’s departure.
IBM also announced that Bridget van Kralingen, Senior VP of Global Markets, is stepping down from her current role. She will serve as Senior VP, Special Projects for a year at which time she will retire from IBM. She’ll be replaced in her previous role by Rob Thomas, currently Senior VP of Cloud and Data Platform.
Evercore ISI analyst Amit Daryanani writes in a research note Friday that the selloff in the shares is not surprising, given that Whitehurst is “a well regarded executive” who has been “instrumental to the company.”
The analyst adds that the announcements “caught investors off guard,” given Whitehurst had been expected to stay with IBM after the pending spin of Kyndryl, the new name for the company’s soon to be independent services business. “Although this is a negative from a headline perspective, we think IBM has a deep senior leadership bench that should enable the company to navigate through key executive transitions,” he writes.
IBM is off 4.3%, to $140.54.
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