Yahoo Finance Salesforce’s Taylor Exits as Co-CEO, Leaves Benioff at Helm
(Bloomberg) -- Salesforce Inc. co-Chief Executive Officer Bret Taylor is stepping down after just a year in the top post alongside co-founder Marc Benioff, the latest potential successor to leave the company.
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Benioff will remain the sole CEO and continue as board chairman of the software giant when Taylor departs on Jan. 31, the company said Wednesday in a statement. Taylor has been at the company for the past six years and was named co-CEO in November 2021.
“I’ve decided to return to my entrepreneurial roots,” Taylor said in the statement.
Taylor, 42, joined Salesforce in 2016 as part of the acquisition of his startup Quip. He had been mentored by Benioff for years at that point and rose quickly through the ranks before being promoted to the top job with him.
Company insiders have described Taylor as handling many of the day-to-day operations at Salesforce, such as hosting the weekly executive meeting. Meanwhile, Benioff, who has run the company since co-founding it in 1999, was able to focus on broad strategy as well as his outside philanthropic efforts.
Taylor’s departure comes almost three years after Benioff’s last co-CEO, Keith Block, left the company. Adam Selipsky, CEO of Tableau Software, a data visualization company that Salesforce acquired in 2019, moved on in 2021 to lead Amazon Web Services. George Hu, another Benioff protege who rose to chief operating officer, departed in 2014. Another prominent executive, Chief Strategy Officer Gavin Patterson, announced earlier this month that he, too, would exit.
“This is extremely hard for me,” Benioff said on a conference call to discuss Salesforce’s quarterly results. “It makes me think of all the great people that we have actually lost in the company over time as well. So many great leaders.”
In addition to his duties at Salesforce, Taylor had been chairman at Twitter Inc. and acted as the point person for the social media company in its contentious acquisition by billionaire Elon Musk. Taylor left Twitter’s board when Musk took over in late October.
“It does leave a big vacuum up north,” Bloomberg Intelligence analyst Anurag Rana said of Taylor’s exit. “It’s concerning as growth slows.”
When asked whether he’d look to replace Taylor, Benioff said he had “a lot of fantastic people in the company.” To be sure, Salesforce has a number of prominent leaders remaining, including Stewart Butterfield, CEO of professional collaboration service Slack, which Salesforce bought last year, and Chief Operating Officer Brian Millham, a 23-year veteran of the company. David Schmaier, who was previously CEO of Vlocity, which Salesforce purchased in 2020, now serves as president and chief product officer.
Taylor’s departure comes as Salesforce is struggling with slowing growth and increasing pressure from investors to improve profit. Separately on Wednesday, the company projected revenue growth of 8% to 10% in the current period -- which would would be the slowest year-over-year increase since Salesforce went public in 2004.
Fiscal third-quarter sales increased 14% to $7.84 billion. It’s the first time Salesforce has failed to generate at least 20% year-over-year quarterly revenue growth. Profit, excluding some items, was $1.40 a share. Chief Financial Officer Amy Weaver said the company is seeing “intense customer scrutiny.”
Salesforce executives declined to give a revenue outlook for the upcoming fiscal year, which they generally provide during the third-quarter earnings call. Weaver said it would be “premature” to offer the forecast, citing an unpredictable economic environment and currency fluctuations. She said Salesforce will offer guidance on fiscal year 2024 during the fourth-quarter earnings call.
The shares fell about 7% in extended trading following the news of Taylor’s exit and the company’s quarterly earnings report. The stock had closed at $160.25 in New York, leaving it down 37% this year.
(Updates with comments from Benioff in the seventh paragraph.)
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