Yahoo boss Marissa Mayer has fired her deputy, chief operating officer Henrique de Castro, just 15 months after she poached him from her old company Google, after he failed to turn around flagging advertising revenues.
‘During my own reflection, I made the difficult decision that our COO, Henrique de Castro, should leave the company,’ Mayer said in an internal memo passed to tech news site Re/code. ‘I appreciate Henrique’s contributions and wish him the best in his future endeavors.’
Ah, the classic ‘You’re fired, but we wish you well.’ Apparently all was not well between Mayer and De Castro though – there had been ‘friction’ between the two for at least six months, an anonymous source told Bloomberg.
Yahoo confirmed De Castro was leaving the company in a document filed with the US Securities & Exchange Commission yesterday, although it didn’t state the reason for De Castro’s sudden exit.
De Castro’s ditching comes as the company’s advertising revenues continue to slide, following a revamp of the company’s email service (which only 25% of Yahoo’s own staff actually use) and acquisitions including the $1.1bn takeover of blogging site Tumblr last year.
While Yahoo’s total revenues dropped 1% in the quarter to September 30 (excluding sales passed to partner sites), display revenue plunged 7%. As display ads account for about 40% of Yahoo’s revenues, Mayer’s vaunted turnaround of the floundering internet giant was clearly not going to plan.
De Castro will walk away from Yahoo a helluva lot richer though. The exec has made as much as $44.8m including stock options since joining Yahoo in November 2012, and could get up to $64.6m under his seriously juicy severance package, researchers Equilar told Bloomberg.
Mayer told staff she would ‘restructure the leadership of the operating organization,’ with several people now reporting to her. If that means Mayer won’t be appointing another new chief operating officer, then the buck will definitely be stopping with her. Just as well really – if Yahoo’s sales keep falling, it might not be able to afford to fire any more top execs.