EBay CEO Whitman Stepping Down

Calling eBay Inc. her "baby," outgoing chief executive Meg Whitman is promising a smooth transition to a new corporate leadership team as she gives up day-to-day control of the online auction company she has led for 10 years.

"EBay is my baby in many ways, and I wanted to make sure the transition was handled in a first class way," Whitman told The Associated Press. She will remain on eBay's board of directors and make herself available to the new team, but looks forward to escaping the 24/7 grind.
"I'm going to power down a little bit," she said. Whitman said she will continue working on presidential candidate Mitt Romney's campaign and a family foundation that focuses on education and health care. Whitman, 51, will leave March 31. She said she began three years ago to think seriously about who would succeed her at the Internet giant she led for 10 years.

Incoming chief executive John Donahoe said during a conference call with analysts Wednesday that eBay is not growing as rapidly as he would like, and he sees the greatest opportunity for growth in increasing the site's offering of fixed-price items. "We need to aggressively change our product, our customer approach and business model," said Donahoe, who has been heading eBay's core auction and e-commerce businesses.

EBay shares fell $2.66, or 9.2 percent, to $26.28 at the open of trading Thursday.
Donahoe pledged to upgrade the site and change the way it charges sellers for listing items. Though details are to come later, he indicated that eBay would lower the fees that people pay to list something for sale, but raise the commission that eBay takes on successful sales.
That's a move analyst Derek Brown of Cantor Fitzgerald said will be eBay's "wild card" going forward, placing pressure on the site to turn any increase in listings into actual sales transactions.

"(The fee structure change) in itself has the potential to change the face of eBay," Brown said.
Donahoe plans on upgrading the site's search function so that if there is an influx of listings, users can still easily find what they are looking for.

Brown said Donahoe's openness about some of eBay's problems is encouraging, but "it feels as if they are pulling a lot of levers at once and that can create its own challenges." The announcement of Whitman's departure came as eBay reported a 53 percent gain in fourth-quarter profits due to a strong holiday season. The results beat Wall Street's expectations, though the company's future guidance was tepid.
By Amanda Fehd
Writer Brian Bergstein contributed to this report
Source: Associated Press