By Rick Aristotle Munarriz
January 22, 2008
Recommended (2)
Is the Meg Whitman era at eBay (Nasdaq: EBAY) coming to an end?
This morning's Wall Street Journal online edition cites unnamed sources who claim that eBay's charismatic CEO may announce her retirement in a few weeks. She has been at the helm since 1998.
It shouldn't come as much of a surprise that Whitman may be working on a succession strategy at the company she helped usher into verb status. When she joined Bob Iger as the only two candidates being interviewed to replace Michael Eisner as CEO at Disney (NYSE: DIS) three years ago, it was easy to fear that she was itching for a new challenge.
The irony is that eBay has become more of a challenge than ever these days. Stateside auction listings have stalled. The company's unchecked shopping spree has proven mortal after last year's $900 million writedown of its costly Skype acquisition. eBay's stock has been more than halved since peaking just before the 2004 holiday season.
Whitman's alleged plans to step down may have little to do with seeking out a new challenge. She may simply be bowing out while her reputation is still intact.
No CEO wants to overstay the allotted welcome. It happened to Eisner at Disney. Like Whitman, he gave his company an amazing initial decade of growth. He stuck around too long, gradually falling out of favor.
Whitman doesn't risk becoming the next Bob Nardelli or Carly Fiorina, but perhaps she sees the same unsettling prospects at eBay that found her entertaining the notion of donning mouse ears three years ago.
Getting out on a high note is important. eBay may grant Whitman that luxury. American Technology analyst Tim Boyd is raising the auctioneer's fourth-quarter estimates ahead of tomorrow night's release, fueled by a refreshing uptick in auction listings.
The problem is that even the near-term bullish Boyd is hosing down his 2008 and 2009 projections, fearing that deteriorating consumer spending trends here and abroad will slam eBay in the future.
eBay is a survivor. It has been able to shake the auction aspirations of sites like Amazon.com (Nasdaq: AMZN) and Overstock (Nasdaq: OSTK) in the past. It has delegated Google's (Nasdaq: GOOG) Checkout to serve as little more than an afterthought when pitted against eBay's strong PayPal. Even with Skype's lofty initial purchase price, at least it's still growing quickly, unlike other Web-based commercial chatterboxes like Vonage (NYSE: VG).
Whitman wouldn't exactly be running away from a burning building if she left eBay this year. Besides, if history has taught us anything, it's that retiring CEOs have a funny way of coming back when the public tires of the successor.
In short, even if Whitman goes, it won't be the last we see of her.
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