Four weeks since the abrupt exit of Greg Clark as CEO, and the long-term prospects of Symantec have once again come under question.
Because as the dust settles on such a high-profile - albeit not so sudden departure - the market is assessing whether the one-time darlings of security can recover from such a “major gut punch”.
Replacing Clark on an interim basis is Richard Hill, who was formerly CEO of semiconductor maker Novellus Systems, giving him experience in enterprise sales, an area where Symantec has faltered.
“It wasn’t a total surprise,” observed Eric Parizo, senior analyst at Ovum. “A change at the top had become inevitable. After several years of strategic realignment and largely positive momentum, Symantec’s fortunes of late have been rapidly deteriorating.”
Australian-born Clark was originally CEO of Blue Coat, prior to the vendor being acquired by Symantec and according to Parizo, was a “surprise pick” to spearheaded the combined entity.
“Naturally, he brought many of his top lieutenants with him,” Parizo said. “His strategy was to combine Symantec’s best existing technology with cutting-edge acquisitions including Skycure and Fireglass, transforming Symantec into the go-to vendor for securing users, devices, data, and applications as enterprises shift their infrastructure to the cloud.
“Innovation was starting to make a comeback at Symantec.”
For Parizo, Clark made “substantial progress” in the role, ending Symantec’s four-year revenue decline in 2017 as a starting point.
The research analyst also suggested that Clark provided enough reasons for optimism among investors and security buyers regarding the fortunes of the world’s largest security software vendor by revenue.
“He even dumped ill-fitting storage unit Veritas, and bought Lifelock to bolster Symantec’s waning consumer business,” Parizo explained. “But in 2018 Symantec’s financial performance once again slipped below expectations.
“Soon an internal investigation resulted in $12m of improperly recognised revenue, and a pending shareholder lawsuit accuses Clark and others of intentionally manipulating revenue that affected executive bonuses. Furthermore, a whistleblower has accused several former Blue Coat executives of unethical behaviour.”
With Clark now sidelines, and Hill an the wheel for the foreseeable future, the security vendor has its sixth CEO within 10 years.
“What happens next?” Parizo asked. “While Symantec’s board might be tempted to find an outsider with a fresh perspective for its next permanent CEO, the wisest choice may be EVP Art Gilliland.
“The enterprise products chief recently returned to Symantec after high-profile stints at Skyport Systems and Hewlett Packard Enterprise, and his familiarity with the vendor’s current strengths and past mistakes would be invaluable.”
Regardless, Parizo cautioned that the coming months “won’t be easy” for Symantec.
“With legal and regulatory uncertainties lingering and a massive product portfolio that may require culling, difficult choices lie ahead,” he explained. “The vendor must decide what it wants to be; getting smaller and more focused wouldn’t be a surprise.
“As for Clark’s tenure, despite the promise when it began, history may note it as merely the latest Symantec reinvention effort to fall short.
“Yet if Symantec can find a way to leverage its unique assets and innovative capabilities while modernising its venerable legacy solutions, its future might prove brighter than it seems today.”