Pondering The Mystery Of Adobe CFO's Departure

| About: Adobe Systems (ADBE)

On Thursday, without providing a lot of explanation, Adobe Systems (NASDAQ:ADBE) announced the resignation of CFO Randy Furr after just six months on the job. The company that “Furr’s resignation is unrelated to his work performed at Adobe and no issues have been raised regarding the integrity of the company’s financial statements.”

So then what happened? The Street has been trying to unravel the mystery this morning. The most obvious explanation is that it had something to do with events at Sanmina-SCI (NASDAQ:SANM), where he had a long tenure before joining Adobe. As Goldman’s Rick Sherlund noted Friday morning, Furr served as President and COO at Sanmina from 1996 to 2005, and as CFO from 1992 to 1996. On October 12, Sanmina announced that its board found problems with most of its stock option grants from 1997 to 2006. The company said at the time that its internal investigation had concerns with the actions of “a former and a current member of management involved in the authorization, recording and reporting of stock option grants,” but didn’t identify the two individuals. Furr left Sanmina in October 2005, citing personal and family reasons.

Citibank’s Brent Thill says he believes the resignation was “not at Adobe’s request.” He note We believe he voluntarily resigned for personal reasons and not at Adobe’s request. He theorizes that “Furr may have decided it is best not to risk casting any shadows on Adobe,” given the issues at Sanmina.

Cowen’s Walter Pritchard thinks that’s the root of the problem, as well. “[B]etter for Furr to resign on own terms than under more formal circumstances like a subpoena,” he wrote this morning.

On the other hand, Heather Bellini, an analyst at UBS, says she does not think the resignation has anything to do with what happened at Sanmina. “We believe his Adobe resignation is likely for personal reasons,” she says, without providing any details on what kind of reasons those might be.

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