Management Turnover as Change Agent

Wednesday, May 21, 2008

Sonus Networks Brings in New CEO From Motorola

Sonus Networks SONS (NASDAQ), the market leader in IP communications infrastructure, has made a major change at the top. After ten years leading Sonus Networks as both CEO and chairman, Hassan Ahmed has given up his CEO position but will remain the company's chairman. The company has selected Richard Nottenburg, PhD., the former Motorola Inc. vice president and chief strategy and technology officer. Nottenburg leaves Motorola in the midst of continuing management turnover at the top as new CEO Greg Brown works to re-right the floundering Motorola ship. Nottenberg may turn out to be a real coup for Sonus. Both his background and experience may bode well for the firm.

Nottenberg holds three degrees in electrical engineering, including a doctorate from the Ecole Polytechnique Federale de Lausanne, a master's degree from Colorado State University and a bachelor's degree from Polytechnic University of New York . He originally came to Motorola in 2004. According to a story in Mass High Tech,
... he was responsible for the company's (Motorola) corporate strategy and technology agenda, including the oversight of venture investments and acquisitions.
During his tenure at Motorola, the company made a number of high-profile acquisitions including Good Technology and Symbol Technologies. Before working at Motorola he was vice president and general manager of Vitesse Semiconductor Corporation after its merger with Multilink Technology Corporation. He was a co-founder and chief executive of Multilink. Prior to Multilink, he worked with ATT Bell Laboratories.

Sonus continues to perform reasonably well. It's latest first quarter results which took place in a difficult market were better than acceptable.
Revenues for the first quarter of fiscal 2008 were $74.0 million, compared with $97.1 million in the fourth quarter of fiscal 2007 and $71.1 million for the first quarter of fiscal 2007. Net income on a GAAP basis for the first quarter of 2008 was $0.6 million, or $0.00 per diluted share, compared to GAAP net income of $14.1 million, or $0.05 per diluted share, for the fourth quarter of 2007, and a GAAP net loss of $4.0 million, or $0.02 per share, for the first quarter of 2007.
Nottenburg can be expected to hit the ground running. He will also be appointed a member of the company's board. The company is not in serious difficulty and its future prospects appear positive. One can assume Nottenburg will try and play off his vast connections in the technology sector to bring new impetus to the firm.

Keep a close eye on his first six month decisions and business moves. Be assured that Hassan Ahmed will be watching closely.

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