Semel's Departure From Yahoo: More Than Meets the Eye

Whoa, good call by me over and over (and over) on CNBC about Terry Semel's tenure at Yahoo (YHOO). The company's beleaguered and failing CEO is out, as of market close last night, with Jerry Yang taking his place. Mind you, Semel is apparently staying on as "non-executive chairman" and as an "important resource" at Yahoo, a euphemism which put me in mind of some combination of Sunnyvale taxi driver and Sparkletts delivery guy.

The stock is up on the news, which will irritate my friend Herb Greenberg to no end, but makes me right in what I've been saying on CNBC for some time.

The WSJ Deal Journal wins the award for the most out-there explanation for Terry Semel's departure from the CEO seat at Yahoo.

Semel says: “The Board and I have long talked about the importance of ensuring a smooth succession in Yahoo!’s senior leadership — and more recently, about the need for a leadership team committed to carrying Yahoo! through its multi-year transformation.”

Does that mean the former Hollywood executive wasn’t “committed to carrying Yahoo! through its multi-year transformation”? If not, is that because he thinks the company needs a deal to give it a competitive edge vis a vis the likes of Google? ...

If Semel resigned over deal-related differences with the board, it wouldn’t be the first time this has happened.

You've got to be kidding. The much-criticized Semel left the company now because the board wouldn't do a deal he wanted to do? That reminds me of the old Vietnam-era line about having to destroy the village to save it.

The preceding said, there is certainly more going on here than meets the eye. A few weeks ago Jerry Yang was the invisible guy. Last week at the Yahoo annual Terry Semel inexplicably started pitching the idea of Yang as Yahoo CTO. And this week, he's the CEO. Quite the change, and not one that's like to sit well with Wall Street the more people ponder it.

Live notes from Yahoo's conference call follow:

1:51 PM Jerry opens things up, but Terry is on the call.

1:52 PM Jerry turns to Terry. If this keeps happening I will have typos galore. Semel is saying nice things about Jerry Yang and Sue Decker. As an aside, no sign of that Filo guy.

1:53 PM Semel is saying "he's long been talking about a smooth transition" in the company's senior leadership. Claims he wanted to leave sooner rather than later. Riiiight.

1:54 PM Stock is up 4% in afterhours.

1:54 PM Semel concedes recent disappointing Yahoo financial performance, but doesn't name names. Gosh, I wonder who was in charge? He or she should leave, damnit!

1:56 PM Terry is overplaying the team aspect of Jerry and Sue. I'm guessing he is talking in part to Sue, to let her know that she's a real power, as well as talking to the Street and potential investors.

2:03 PM Web 2.0 count: 1

2:07 PM Still not clear to me what's going to be different. Better execution? What about dumping some assets? Execution, winning, and speed are nice, but specifics would be helpful.

2:08 PM The stock is not up as much, holding at 2.9%.

2:10 PM I'm a little baffled right now. We're being told by Sue how changes made by Semel have prepared the company for the future. Right. And so ... ?

2:12 PM Okay, she's canceling a particularly dubious recruitment. That's good.

2:15 PM Impression-based ads are underperforming. Guiding to lower half of sales/earnings range in second half.

2:16 PM Must. Stay. Focused. Don't. Sleep. With. Sue's. Monotone. Speech.

2:20 PM The letters to/from Semel and the board in some new SEC filings are such happy talk. Makes me think Semel is getting a gold watch after thirty years of service, not leaving under loud complaints.

2:22 PM Yahoo stock now up 5% afterhours.

2:24 PM Whoa, Terry is taking a question. Thought he'd run off to the Sparkletts truck. Says he sees himself more as a coach than a player, going forward. Over/under on how long Coach Semel stays around? I say not past Thanksgiving.

2:37 PM Whoops, drifted off there. Call just ended.

That was a fairly uncompelling call. They are going to do things better, faster, smarter, etc. They're going to be "customer-centric". Great. And they're going to stay independent. Ouch. There is no way Yang is anything but a stopgap, and this press release and teleconference treated people like irritating children.

In the interim, expect financial results to be a little worse than expected in the second half of the year, and that's before any restructuring or other costs that may yet come.

YHOO 1-yr chart