Fusion-io founders quit to start new venture, shares slump
(Reuters) - Memory drive maker Fusion-io Inc said founders David Flynn, the chief executive, and Rick White, chief marketing officer, have resigned to set up another venture, sending the company's shares down more than 25 percent in early trading.
Director Shane Robison will succeed Flynn, effective immediately.
Flynn, who has been chief executive for two years, took the company public in June 2011. The company's stock peaked at $41.69 in November 2011 but has fallen sharply since then. The stock was trading at $13.63 on Wednesday morning.
Fusion-io makes solid state memory drives using NAND flash technology and counts Facebook Inc and Apple Inc among its key customers.
"We do not think it is a good sign to see co-founders leaving so soon after going public," JP Morgan analyst Mark Moskowitz said in a research note.
"Also, Mr. Flynn has been well regarded as Fusion-io's CEO and well respected in the data center ecosystem."
Flynn served as chief architect software engineer of Linux Networx and founded the Utah research and development satellite office of Oracle Corp before setting up Fusion-io.
Robison served as chief strategy and technology officer of Hewlett-Packard Co before leaving in November 2011.
"(Robison) brings a mixed track record from his time at HP, where he led the M&A strategy and was in part responsible for the Palm and Autonomy acquisitions," Moskowitz said.
Fusion-io last month forecast fourth-quarter revenue ahead of analysts' estimates.
The company reaffirmed its outlook on Wednesday.
Fusion-io's shares fell as low as $13.43 in morning trade on the New York Stock Exchange on Wednesday.
(Reporting by Sayantani Ghosh in Bangalore; Editing by Supriya Kurane)