Yahoo COO Henrique de Castro Out Amid Continued Revenue Declines
Yahoo COO Henrique de Castro, CEO Marissa Mayer's first high-profile hire, is out, according to a filing with the SEC.
Like Ms. Mayer, Mr. de Castro was a former Google exec and was lured away with a four-year $62 million pay package in October 2012.
But he had an icy relationship with ad execs who found him aloof when they were accustomed to being catered-to by Yahoo brass.
His approach wasn't exactly working: ad revenue at the portal declined over the past year, even as Ms. Mayer touted splashy relaunches of email, the homepage, Flickr and a $1.1 billion acquisition of Tumblr and Summly.
In recent months Mr. de Castro had stopped speaking for the company. De Castro was conspicuously absent at the Consumer Electronics Show in Las Vegas, where Yahoo generally starts talks with big advertisers. Ms. Mayer gave a keynote and head deal maker Jacqueline Reses gave presentations to WPP and IPG agencies.
Ms. Reses also articulated Yahoo's M&A strategy going forward, which is focused on buying tech and science over media.
Ms. Mayer has shown speed in implementing change at Yahoo but that has not translated into increased ad revenue. Yahoo regained its position as the top web property in the U.S., according to comScore, but it was long ago surpassed by Google and Facebook in ad revenue. Last year Yahoo fell behind Microsoft last year with a 5.9% if U.S. digital ad dollars, according to eMarketer.
Display ad revenue fell to $421 million in the third quarter of 2013 compared to $452 million a year ago.
It couldn't help that Mr. de Castro never formed tight relationships with Madison Avenue execs, many of whom started to grumble soon after he took up his post at Yahoo. Yahoo was once a dominant force on online advertising and on Madison Avenue gave agencies detailed looks into their strategy and product pipeline.
That changed with Ms. Mayer and Mr. de Castro. "I don't know what the product strategy is, what the content strategy is, what the data strategy is," said Digitas exec Adam Shlachter last spring. "And that's to their detriment, because it puts people's attention up for grabs."
Now that job falls to Ned Brody who resigned from AOL last spring and joined Yahoo in the fall as SVP and head of sales in the Americas. Re/Code's Kara Swisher reported that Mr. de Castro had butted heads with Mr. Brody, as well as CMO Kathy Savitt in recent months.