Splunk (NASDAQ:SPLK) stock is taking a beating on Monday after the software company announced current CEO Doug Merritt is stepping down.
Merritt is leaving behind the CEO position at Splunk after six years in the role. However, he will stay on as an advisor to ensure a smooth transition as the company searches for his permanent replacement.
Graham Smith, the chairman of the Board, is taking over as the interim CEO of Splunk with Merritt stepping down. Smith has served on the company’s Board of Directors since 2011 and has held previous executive roles at other companies.
Merritt said the following in the Splunk news release dropping SPLK stock today.
“As the Board and I considered how to best position Splunk for long-term success and continued growth. We determined now is the right time to transition to our next phase of leadership – in particular, the Board is focused on identifying a leader with a proven track record of scaling operations and growing multi-billion dollar enterprises.”
The news release announcing Merritt’s change in roles also comes with preliminary results for fiscal Q3 2022. Among that is a revenue estimate of $660 million. That’s positive news considering Wall Street’s revenue estimate of $646.38 million. Even so, it can’t stop SPLK stock from falling on the surprise CEO news today.
Investors watching SPLK stock will want to check back in on it when Dec. 1 rolls around. The company will release its most recent earnings report after markets close that day.
Heavy trading today has more than 2 million shares of SPLK stock changing hands as of this writing. That’s already above its daily average trading volume of about 1.5 million.
SPLK stock was down 14% as of Monday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.