CEO resignations: 668 executives have left their posts since January
Yahoo Finance Live anchors discuss first-quarter earnings for Bed Bath & Beyond as well as the growing number of CEO resignations since January.
Video Transcript
AKIKO FUJITA: One of the stories we're watching very closely today is Bed Bath & Beyond. Shares sinking would be an understatement. Let's show the stock chart here. It is down more than 21% here, following announcement of CEO Mark Tritton leaving his role at the company. Tritton will be replaced by Sue Gove, who will serve as interim CEO.
A lot is being made here of their most recent earnings numbers here. Obviously a big miss on earnings as well as revenue. But this, in a way-- that pressure on Mark Tritton has been building for some time from activist investor, Ryan Cohen, who has, among a number of things, called for the spin-off of Buy Buy BABY, you know, I mean, saying essentially that management is not steering the company in the right direction.
The reason I bring this up, though, is because this announcement today came on the back of a separate announcement we got yesterday from Pinterest saying that Ben Silbermann is going to be stepping down. He's the Founder and CEO of the company.
And an interesting number, I think, is worth watching because yesterday we saw that announcement and said, look, here comes another-- another change in the C-suite. 668 executives have now left their position since January. This is the data that came down from executive coaching firm, Challenger, Gray & Christmas. Up to May-- so we're talking about June now. But I know we talk about the Great Resignation.
BRIAN CHEUNG: It's spilling over into the C-suite.
AKIKO FUJITA: It's happening in the C-suite.
BRIAN CHEUNG: Yeah. And actually, I mean, I think that in the broader labor market, there's going to be perhaps some settling as the story of the Fed raising rates maybe changes the picture on a tight employment market. But in the C-suites, I could see this turnover lasting for a while. I mean, this might just be, despite the stats that you already offered, the beginning of what could be a lot of turnover and, you know, CEOs leaving.
And I want to preface this by saying, this is a weird scenario, where it's not just because you're looking at companies where the stocks are down 50% to 60%. I mean, yes, the S&P 500 is only down 20%. But there is a lot of reopening plays that sent those stocks, you know, 50% to 60% higher through the pandemic recovery. So it's not necessarily as binary as, well, the stock is doing bad, CEO's got to go.
But think about what's going to be coming around the corner, especially given the macro story we just talked about with Jay Powell. If we go into a recession, margins start to crunch, there's going to be a lot of pressure on the C-suites-- that have done so well, for the most part, through the recovery-- to then try to manage a corporate strategy through a recession. And I don't think it's just the meme stocks because that's very much a big story of Tritton as well at Bed Bath & Beyond, but it's going to be a lot of other large companies that are not always on the wallstreetbets forums as well.
AKIKO FUJITA: Well, and also worth noting, these are companies-- two separate companies with two very different stories. But obviously, we're looking at the underlying trend here. You said that you think this could be the beginning of, you know, more exits to come here. That 668 number-- that is the most since this firm started tracking those numbers in 2002. So that tells you something, and we're only halfway through the year.
BRIAN CHEUNG: Yeah. And I think, again, with the Bed Bath & Beyond story, as you mentioned, there's a difference between Bath Bath & Beyond and GameStop when it comes to the meme stock story. But Ryan Cohen, the Chairman of GME, to get people up to speed on the story-- 9.8% stake in Bed Bath & Beyond. The reporting seems to be that he advocated for, perhaps, this change here. We know that he's been very-- he's been a strong voice, let's just say, in terms of Tritton's strategy with this company.
But look, you can argue-- I mean, remember, shares of Bed Bath & Beyond were at $35 in 2021.
AKIKO FUJITA: I was going to say that. I was going to say that, yes, it's not just a share story. But take a look at the one-year here.
BRIAN CHEUNG: And there is an argument that maybe Mark Tritton didn't do enough to take advantage of what was a strong currency for this company at that point in time. They had a $1 billion share buyback. Maybe they should have done more to improve their position. We know other meme stock-targeted companies have done the same.
But again, I think there are also kind of underlying fundamental stories. Buy Buy Baby is not a meme story. That's a strong brand. Spinning that off was probably a valid argument, right? Obviously, now you wonder with the new management coming in, whether or not they'll try to follow through on that.
