eBay's "heir apparent" steps down
More bad news for eBay as PayPal chief Jeff Jordan announces he's leaving the company.
NEW YORK (CNNMoney.com) -- eBay may need to put in a bid on a new successor for chief executive officer Meg Whitman.
Jeff Jordan, the president of the auction giant's PayPal online payment unit, announced Thursday that he was leaving eBay to spend more time with his family. Jordan had been with eBay since 1999 and was widely believed to be a possible heir apparent to Whitman.
Jordan will be replaced at PayPal by Rajiv Dutta, who only a few months ago gave up his position as eBay's chief financial officer to become the president of Skype, the Internet phone service which eBay acquired last year for $2.6 billion.
Alex Kazim, currently Skype's vice president of products for Skype, was promoted to take over for Dutta. The company also named a new president of its eBay International unit as well as a new general manager for its Shopping.com comparison shopping service.
"We find the management shuffle announced this morning somewhat disconcerting. Not only are they losing Jeff Jordan - widely seen as one of their best - but Rajiv Dutta's move from Skype to PayPal after only a few months on the job may raise some eyebrows," wrote UBS analyst Benjamin Schachter in a report Thursday. "We think these moves could raise investors' concerns about eBay's operational execution and future strategy."
The shakeup is the latest bit of bad news for eBay investors. Shares of eBay have plummeted more than 35 percent so far this year.
Some thought eBay overpaid for Skype -- the purchase price could actually reach $4.1 billion if certain financial goals are met. Others have pointed to slowing auction growth in eBay's core markets of the U.S. and Europe as a cause for concern as well.
More recently, investors have also been scared about increased competition from search engine Google (Charts), which last week unveiled a new online payment service called Google Checkout. This is viewed by many as a legitimate threat to PayPal.
In a report Thursday, Citigroup analyst Mark Mahaney cut his long-term earnings growth forecast for eBay from 22 percent a year, on average, to 20 percent a year. And he cited competition from Google Checkout as his main reason for cutting his projected growth rates.
"On two key attributes -- speed of checkout for consumers and transaction fees for merchants -- Google Checkout has leapfrogged PayPal," wrote Mahaney.
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