Akamai Technologies Inc., which helps businesses deliver data at faster speeds over the Internet, said Chief Executive Officer Paul Sagan will leave by the end of 2013. The company’s shares fell after Akamai forecast profit that missed estimates.
Second-quarter profit excluding some costs will be 36 cents to 38 cents a share, James Benson, chief financial officer, said during a call with analysts Wednesday. That’s less than the average analyst estimate of 39 cents, according to data compiled by Bloomberg. Sales will be $322 million to $330 million, more than the analysts’ estimate of $314.8 million.
Akamai, whose customers include Apple Inc., is being helped by demand for services that push data-heavy digital media content, such as videos, around the world more quickly. The company, which said it’s embarking on a search for Sagan’s replacement, is likely to look externally for a new CEO, said Donna Jaegers, an analyst at D.A. Davidson & Co. in Denver.
“I think he just wants to move on to the next phase of his life,” Jaegers said. “Of course, he would like to go out with great numbers. I don’t sense that there’s going to be a radical change in the company.”
The CEO transition will make an acquisition of the company less likely, she said.
Sagan, who became president in 1999, has been CEO since 2005. He has been with the company for almost 15 years.
First-quarter sales rose to $319.4 million, topping $310.8 million, the average analyst estimate. Profit excluding some costs was 41 cents a share, the Cambridge, Massachusetts-based company said in a statement Wednesday. That beat the 38-cent estimate.
Net income fell to $43.2 million, or 24 cents a share, from $50.6 million, or 26 cents, a year earlier, the company said.
Akamai declined as much as 11 percent in extended trading, after closing at $38.75 in New York. The stock climbed 20 percent this year through Wednesday’s close.
© Copyright 2016 Bloomberg News. All rights reserved.