Pandora Media (NYSE:P) is on the hunt for a new leader. The company announced Tuesday that CEO Tim Westergren has resigned from his position, and vacated his seat on the board of directors. He has been followed out the door by two other top managers, President Mike Herring and Chief Marketing Officer Nick Bartle.
CFO Naveen Chopra has been named interim CEO. The company said it has begun a search for a permanent replacement. Westergren's board seat has been filled by Jason Hirschhorn, CEO of the ReDEF Group, which Pandora describes as a "digital content curation company."
Westergren is a co-founder of Pandora. He served two terms as CEO -- the first ran from 2002 to 2004, and the second began in March 2016.
Does it matter?
Westergren's resignation wasn't much of a shock. Several media reports had it that he was on his way out in the wake of the company's deal earlier this month to accept a $480 million cash infusion from satellite radio broadcaster Sirius XM (NASDAQ:SIRI).
In return, Sirius XM gained three seats on Pandora's nine-member board and preferred stock that gives it a 19% stake in the company. Sirius XM CEO Jim Meyer was quoted as saying that the deal "represents a unique opportunity for SiriusXM to create value for its stockholders by investing in the leader in the ad-supported digital radio business, a space where SiriusXM does not play today."
Lately, Pandora has been pouring its resources into its recently launched on-demand music service. This business costs more in terms of artist royalty rates, however, and is hotly competitive at the moment.
Perhaps SiriusXM will try to turn Pandora back to its emphasis on ad-supported radio, as Meyer's statement seems to imply. Whether it does or not, the latter company will likely continue to rack up bottom-line losses regardless. So, I'm not bullish on Pandora's prospects at the moment, and I think its stock is best avoided for now.