eBay CEO Meg Whitman Stepping Down

Meg Whitman announced that she was stepping down as CEO of online auction site eBay on Jan. 23. After a decade as the head of the company, her resignation will become effective on March 31, when John Donahoe, the current director of eBay’s primary auction business will take over. Under Whitman, the company grew from an e-retailer with $4 million in annual revenue and a staff of 30 into a multibillion dollar conglomerate that took over Web payment firm PayPal and free Web-based phone service provider Skype. Despite eBay’s profits showing growth of 53 percent over the fourth quarter of 2007, according to the BBC, “earnings for the coming year fell short of expectations.”

In an April 2001 interview with business magazine Fast Company, Meg Whitman confirmed speculations that she never originally intended to spend the rest of her career with the company. “I wasn't sure that I could actually [be eBay CEO] for longer than five years. It really is a 7-by-24 job – you're constantly on call,” she said.

Fortune magazine ranked Meg Whitman No. 3 in the 2007 edition of its annual “50 Most Powerful Women” list. The magazine writes, “It hasn't been easy for this web 1.0 superstar to figure out how to succeed in a 2.0 world, but the $6 billion company remains the world’s No. 1 e-commerce brand.”

Meg Whitman’s resignation confirms months of rumors following eBay’s slow expansion in 2007. While profits shot up by 53 percent over fourth quarter 2007, its main auction business suffered for two consecutive quarters last year. The online retailer said in a conference call that its “best days are yet to come,” yet Wall Street analysts do not share that optimism. “Right now, eBay’s growing at 21 percent to 22 percent. To get really get excited about [the company], they have to grow in the high 20s to over 30 percent," said Martin Pyykkonen, analyst for Global Crown Capital.

Henry Blodget, former stockbroker turned online columnist, offered a four-step plan to revive the e-retailer in December 2007, before fourth-quarter reports showing 53 percent growth had been released. The fourth prong of his plan is to retire Meg Whitman. “The mistakes of recent years—Skype, failure to focus on the buying experience, failure to buy, copy, kill, or partner with Amazon—have hurt the company's core business and competitive position,” he writes.

Meg Whitman has reportedly talked with chiefs of the California Republican Party regarding a possible gubernatorial bid. A source close to Whitman has said the former CEO became “fascinated” with politics during her fundraising work for 2008 presidential candidate Mitt Romney. Whitman and Romney worked together at consulting firm Bain & Co.