Gary Wojtaszek has resigned from his role as CEO and president of CyrusOne (CONE), after close to nine years at the helm.
Tesh Durvasula, former head of CyrusOne’s European business who was expected to leave the company, will now step in as interim CEO until a permanent one is found. The board will consider Durvasula, with seven years in top roles at CyrusOne under his belt, as well as external candidates.
The company has been sailing rough waters in the stock market recently. It’s been consistently rumored to have been an acquisition target and earlier this year laid off 12 percent of its workforce. Wojtaszek said the job cuts were necessary to adjust to slowing demand for data center space from hyperscale platforms – the likes of Google and Microsoft.
Hyperscale demand has been slow since last year – following a few years of unprecedented boom in leasing in the top markets, a period that propelled CyrusOne to become one of the leaders in the space. Wojtaszek has maintained that the fundamental market drivers that fueled the boom are still in place, and that demand will eventually pick back up.
But the stock market doesn’t have that kind of patience. CyrusOne has relied on hyperscale leasing for up to 60 percent of its revenue.
Its stock has seen peaks and valleys since the second half of 2018, when hyperscale business was still red-hot, but the recent peaks have generally come on rumors of buyout interest.
Along with announcing Wojtaszek’s resignation Thursday, the company reported fourth-quarter 2019 earnings. Revenue was about $254 million, up 15 percent year over year, and net loss shrunk from $106 million to $52 million.
Full-year 2019 revenue was $981 million – up 19 percent from 2018.
As CyrusOne chairman Alex Shumate pointed out in a statement, the company’s annual revenue grew to nearly $1 billion under Wojtaszek’s leadership. On his watch, the Dallas-based company went public (in 2013, spun off by Cincinnati Bell); expanded internationally, entering Europe, Asia, and Latin America; and reached an investment-grade credit rating.
CyrusOne shares were priced at $19 in the IPO. They closed at $65.99 this Wednesday. CONE shares were up more than three percent on Thursday afternoon Eastern following the leadership-change and earnings announcements.