Yahoo Inc's new CEO is a straight-shooting, tough-talking technology veteran but she is seen lacking two qualifications investors hoped for most: deal-making savvy and Web business know-how.
Carol Bartz was appointed to the top job at Yahoo on January 13 after a two-month search, and brings with her a strong track record of revenue growth at software company Autodesk Inc, where she was chief executive from 1992 to 2006 and still remains executive chairman.
Bartz, however, does not have an established reputation as a deal-maker and Yahoo investors regarded her appointment skeptically, with shares of the Internet search and advertising company dropping more than 3 percent during the trading day.
"People respect her. She is direct and focused, but not mean-spirited like a 'Chainsaw Al' type of person," said Needham & Co analyst Richard Davis, who covered Autodesk when Bartz was at its helm. She is credited with increasing Autodesk's revenue from $285 million to $1.5 billion during her 14-year tenure, as well as diversifying its business. Bartz, 60, built the company by buying small and medium-sized businesses, including a $444 million buyout of Discreet Logic in 1999.
"She seems to me to be more of a builder than a buyer-and-flipper," Davis said. "I'm sure that plenty of people wanted to buy Autodesk over the years."
Analysts lauded her for being a dextrous, capable and committed executive, but said that without any experience in the Internet sector, she would likely find it daunting to turn around Yahoo, which is a distant second to Google Inc in the search advertising market.
Bartz will be under immediate pressure from investors, who have seen the value of their shares nosedive in the past year, to re-open talks with Microsoft Corp and secure a sale of the company at a healthy premium. The software maker has shown no interest in reviving its $47.5 billion take-over bid. Bartz herself welcomed the challenge during her first conference call as Yahoo CEO, saying she wouldn't have accepted the offer if she didn't think a turnaround was possible.
"I just see this company as a company with enormous assets that frankly could use a little management, and I love leading, love managing, love making decisions," she said.
She added that she would address questions of whether Yahoo should look for a search partnership, divest assets and find new ways to cut costs later, after she had spent some time understanding the company.
Collins Stewart analyst Sandeep Aggrawal said Microsoft could see Bartz's appointment as an opportunity to make a fresh proposal for Yahoo.
"Yahoo probably needed a CEO who was going to favour this deal," Aggrawal said. "We were never really sure whether Jerry Yang wanted to do this (Microsoft search) deal or not."
Yahoo co-founder Jerry Yang agreed to step down from his CEO post in November after drawing investor ire for failing to strike a deal with Microsoft.
Although Bartz was mum on Microsoft on her first day, some analysts wondered if her appointment itself was a message to the market that Yahoo wants a CEO who can focus on the company's growth strategy rather than sale.