Vonage Loses CEO, Plans to Restructure
As Vonage faces increasing uncertainty over its future, it now must look elsewhere for a new chief executive as Michael Snyder abruptly announced his resignation from the company.
No reasoning was given, and the company will immediately begin the search for his successor. In the meantime, Chairman Jeffrey Citron will serve as interim CEO until a replacement could be named.
The leadership crisis could not come at a worse time for the nation's largest VoIP operator. Vonage is embroiled in a patent infringement case with Verizon that is threatening to shut the company down.
A district court judge ruled that the company was barred from taking any new customers in a ruling last week, but Vonage was successful in getting the Federal Circuit Court of Appeals to grant a temporary stay while the company argues its case.
"Mike has made valuable contributions to the growth of our business and we will miss him," Citron said. "We thank him and wish him well in his future endeavors."
In addition to Synder's departure, Vonage also provided a preview of its first-quarter results, which aren't too positive. It did not provide any profit or loss numbers, but said it had added 166,000 customers during the quarter on revnues of $195 million.
Vonage will also pull back on marketing, cutting approximately $110 million from its budget this year. In addition, it will let go of approximately 10 percent of its workforce and stop hiring, expected to save $30 million.
"We remain focused on improving our competitive position in the marketplace," Citron added. Over the next month, he said the company will continue to look for other ways to cut costs, reviewing its entire strategy from "top to bottom."