David DeWalt, chief executive officer and chairman of the board at FireEye, a Milpitas, Calif.-based cybersecurity firm, will step down from his post on June 15, the company said Thursday. Kevin Mandia, the company’s president, will take over the CEO role.
News of the transition, which had been rumored for months, accompanied a first quarter earnings report in which FireEye projected lower revenue for the year. The company marked down its forecast to a range of $780 million to $810 million from a range of $815 million to $845 million, attributing the drop to a change in business model toward selling software as a service.
FireEye (FEYE) stock plunged 19% to about $13 per share Friday morning.
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DeWalt, the former president and CEO of anti-virus software maker McAfee leading up its acquisition by Intel (INTC) for $7.7 billion in 2011, led FireEye for four years. He served during a craze of data breaches that sent the company’s shares soaring to highs of $85 in February 2014 just months after going public. Its shares have mostly plummeted since reaching a more recent peak of $53.65 in June of last year.
The company said that DeWalt will assume the title of executive chairman on June 15, a day after its annual shareholders meeting. “I don’t even look at it as stepping down,” DeWalt told MarketWatch.
Mandia, DeWalt’s successor, joined FireEye in January 2014—at the height of investor enthusiasm for the company—as part of a $1 billion acquisition of Mandiant, the self-named computer forensic firm he had founded a decade earlier. Fortune placed him on its cover that month.
Known for investigating some of the world’s biggest data breaches, including Anthem (ANTM), Home Depot (HD), Target (TGT), and Sony (SNE), Mandiant gained notoriety after outing one of China’s top hacking outfits in 2013. (You can read about the firm’s history, its founder, and that groundbreaking cyberespionage report in the Fortune cover story, recently unlocked from the magazine’s paywall vault.)
“I don’t expect there to be a hiccup,” Mandiant told MarketWatch after the company announced his promotion to CEO. “We’re just gonna crush it,” he said.
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Vitor De Souza, FireEye’s head of communications, stressed that the leadership transitions were part of “well thought out” succession plan. “Dave and the Board of Directors felt Kevin Mandia was the obvious choice to lead FireEye as the company’s next CEO,” he wrote to Fortune in an email. “Kevin was instrumental in bringing FireEye and Mandiant together, and in the development of the security solutions, services and delivery models that are core to the company’s strategy today.”
Other team shake-ups include Michael Berry, FireEye’s finance chief, adding the duties of chief operating officer on top of his existing responsibilities; Travis Reese, president of Mandiant, assuming the role of FireEye president; and Enrique Salem, FireEye board member and ex-CEO of Symantec (SYMC), becoming the company’s lead independent director.
FireEye, which sells appliances to detect and block cyberattacks as well as data breach clean-up services, has been expanding its portfolio of offerings through acquisitions. At the beginning of the year the company bought threat intelligence firm iSight Partners for $200 million. The purchases have not stopped rival firms such as Palo Alto Networks (PANW), Proofpoint (PFPT), and Imperva (IMPV) from gobbling up market share.
FireEye reported that its first quarter revenue grew by a third to $168 million from $125.4 million during the same period last year. The company’s losses widened, however, as it reported a quarterly loss of $155.9 million versus $134 million during the same period last year.
FireEye also said it trimmed 200 jobs from its workforce, which numbered 3,100 at the end of last year.