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Palm CEO resigns
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November 8, 2001: 5:18 p.m. ET
Chairman will stand in as the company seeks a new top executive.
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NEW YORK (CNNmoney) - Following a punishing year that saw his company's market dominance weaken and its stock price plunge, Carl Yankowski has resigned as chief executive of handheld computer maker Palm.
Yankowski's departure comes as the Santa Clara, Calif.-based company is in the final stages of splitting into two business, one that focuses on hardware and another on the Palm operating system software.
The company said it has begun a search for a new CEO. In the meantime, Eric Benhamou, Palm chairman, will assume the role.
"With Palm's transition into two individual businesses almost complete, my role has changed, and it no longer matches my aspirations," Yankowski said in a statement. "I leave confident that our separation and solutions strategies, combined with the new leadership at the helm of both businesses, will result in increased shareholder value."
By the end of this month, Palm is expected to begin operating as two separate business groups, with the idea being to eventually create two companies with two separate stocks.
One group, called the solutions group, will be responsible for developing and selling Palm's handheld computer, which currently dominate the market, as well as add-ons and accessories.
The other group, called the platform solutions group, will be responsible for developing and selling the Palm operating system, which the company licenses to several other vendors, including rivals such as Handspring and Sony, as well as some manufacturers of mobile phone and other wireless communications devices.
Palm recently named Dave Nagel, formerly the chief technology officer of AT&T, to lead the platform solutions group.
Since it first introduced its popular "Pilot" devices in 1996, Palm has been the dominant supplier of handheld computers. However, it has been losing market share to rivals such as Handspring, as well as manufacturers of Pocket PC devices, which run a competing operating system developed by Microsoft.
In addition to the increased competitive pressure, Palm this year has been faced with a sharp and sudden slowdown in technology spending, as well internal missteps with resulted in delays in shipments of its new products.
As a result, the company's bottom line has been tumbling, as has the value of its stock. Palm (PALM: Research, Estimates) shares fell 2 cents to $2.28 on Nasdaq ahead of Thursday's announcement, which was made after the closing bell. The stock has fallen more than 96 percent over the past year from a high of $65.75. 
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