Shares of Micro Focus International (NYSE:MFGP) have tanked today, down by 21% as of 12:20 p.m. EST, after the company reported preliminary results for the fiscal year that ended in October. Executive Chairman Kevin Loosemore is also stepping down after serving in that role for 15 years.
Revenue last fiscal year plunged 30% to $3.3 billion, with operating profit falling 41% to $222 million. The U.K.-based tech company had commenced a strategic review in August, and Micro Focus is taking a series of drastic steps in its ongoing turnaround efforts, including replacing Loosemore. The company has named Greg Lock as non-executive chairman, effective Feb. 14. Investors had hoped the strategic review would culminate in a sale of the company, but Loosemore was unable to find any buyers.
In a statement, CEO Stephen Murdoch said:
This has been a challenging year for Micro Focus and our overall financial performance fell short of expectations. As a result, we conducted a Strategic & Operational Review, which has identified the additional actions and changes required to deliver on the significant potential within the business. Successful execution of these actions, will position Micro Focus to deliver against our goal of consistent and sustained value creation for customers, shareholders and employees.
Micro Focus has struggled to integrate Hewlett Packard Enterprise's software business following their 2017 merger, which included the controversial acquisition of Autonomy that HP had previously impaired. As part of the review, the company has decided to restructure itself around security and big data business segments.
Micro Focus' outlook for fiscal 2020 calls for revenue to decline by 6% to 8% on a constant currency basis.