Bank Execs All Sacked: Firings Move To Tech Industry (ORCL)(SYMC)(AMD)(EBAY)(YHOO)(INTC)(HPQ)(JAVA)

November 18, 2008 by Douglas A. McIntyre

R218533_855025John Thompson, the head of Symantec (SYMC), "stepped down" yesterday. Hector Ruiz recently vacated the CEO’s office at AMD (AMD). The head of Sun (JAVA), Jonathan Schwartz, will probably be gone soon. Meg Whitman left Ebay (EBAY), perhaps not under her own steam. Jerry Yang of Yahoo! (YHOO) has given up the ghost.

Silicon Valley is started to look like Wall St. With share prices falling and earnings moving into the red, that comparison becoming even more apt.

And, it makes sense. Over the last three months, share in Symantec are down 55%. JAVA is off even more. There are credible rumors that the heads of Motorola (MOT) and Sprint (S) may simply have their companies sold out from under them.

What has happened is that in tech, like in banking before it, is a list of "haves" and "have nots" has developed. The customers and resources sit with firms like Oracle (ORCL) Intel (INTC), and HP (HPQ) and they suck up the market share. They have the R&D capital. They have the cash on their balance sheets.

In a good environment, the dichotomy was less pronounced and it meant less. There was less reason to complain about management at tech companies when IT spending was moving up rapidly. Now, the weakest companies do not just need to be reorganized, they need to be saved. Some carry enough debt and have dramatic enough drops in earnings that they are at real risk for failure.

Tech was supposed to be somewhat recession-proof. That makes the sins of the stragglers all the more glaring.

Financial executives can look for a little relief. The guillotine has moved to the West Coast.

Douglas A. McIntyre