Fortinet shares fall on CFO departure

Fortinet shares fall after CFO announces plans to move to Yahoo

Associated Press

Fortinet slid in Wednesday trading after news broke that its chief financial officer was leaving the security software company for Yahoo Inc.

THE SPARK: Yahoo announced late Tuesday that it was hiring software industry veteran Ken Goldman to be chief financial officer as part of a major turnaround effort. Goldman, 63, will replace Tim Morse at Yahoo on Oct. 22.

THE BIG PICTURE: Yahoo's CEO Marissa Mayer hired Goldman, just two months after Yahoo lured her away from Google, as she reshuffles the executive team to push the company in a new direction.

Goldman has been in corporate management for more than 30 years. He is well-known as the CFO of Siebel Systems, where he worked for six years until the business software maker was sold to rival Oracle Corp. for $6.1 billion.

THE ANALYSIS: Jefferies analyst Aaron Schwartz said that Goldman's departure is somewhat surprising, given his long run at Fortinet. He has served as chief financial officer since 2007 and helped take the company public in 2009.

Schwartz said that Goldman had managed Fortinet well and the departure brings a degree of uncertainty for the company, as well as leaving some big shoes to fill. However, he does not expect any disruption to the business.

The company has not announced a search for a new CFO, but Schwartz expects it will include both internal and external candidates.

SHARE ACTION: Shares of Fortinet Inc. fell 91 cents, nearly 4 percent, to $24.94 by midday Wednesday. Its shares were already on the decline since last week when it hit a month-long peak of $27.54 but began to fall.

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