It’s official: the once high-flying interactive design shop and Web consultancy Razorfish has a new chief executive.
Jean-Philippe Maheu, Razorfish’s former chief operating officer, has assumed the role of chief executive officer, effective immediately, said the company. Maheu replaces Jeff Dachis, the firm’s co-founder and eccentric poster child for the Silicon Alley scene.
Also leaving is chief strategic officer Craig Kanarick, who founded the company with Dachis. Both will remain co-chairmen of the board of directors.
With Razorfish’s stock price’s precipitous decline — from a high of $58 in early 2000, to a closing price of $1.61 on Wednesday — industry insiders say Wall Street was eager to see changes at the Alley firm.
Indeed, spokespeople from advertising agency group Omnicom Group, a major investor in Razorfish and several other interactive shops, have said publicly that Omnicom management has been displeased with the performance of its digital “Communicade” portfolio, and has been looking at ways to reorganize it.
At least one of those companies, Organic, has wound up aligned with Omnicom’s BBDO, in a “strategic agreement” of which terms have been closely guarded. A third Omnicom-invested firm, New York-based Agency.com, Thursday released preliminary quarterly earnings figures but delayed its investor call until May 14, at which point it said it would discuss results and “strategic initiatives.”
It is not known at this time whether Omnicom had a role in Razorfish’s restructuring. Spokespeople did not return repeated calls for comment.
However, Dachis released a statement saying that the change had taken place only after “much examination and discussion with the Board.”
“I am confident that this leadership change is in the best interest of Razorfish,” Dachis said in the statement. “I am proud of what Craig and I founded over six years ago and I have total confidence in Jean-Philippe’s demonstrated ability to lead the company to long-term success.”
Razorfish posted some better-than-expected first-quarter losses in addition to the news of Dachis’ departure. The firm saw a before-charges loss of $6.6 million, or $0.07 per share. Analysts had expected Razorfish to post a quarterly loss per share of $0.08, according to Thomson Financial/First Call estimates.
Revenues were down $7.4 million from last quarter, to $42.7 million.
Last quarter, the firm posted its second consecutive quarterly loss — a pro forma net loss of $19.8 million, or $0.20 per share.
In addition to the better-than-expected quarterly results, the company’s new top executive had more reassurances to give investors about Razorfish’s future.
“Our primary goal is to manage our return to profitable operations and positive cash flow while successfully serving the expectations of our clients, shareholders and employees,” Maheu said. “These financial results reflect this direction. We continue to gain traction with new and current clients, including Cisco, Ford, and Natwest and we are beginning to see the benefits of our cost reduction efforts.”
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