Amazon President Quits for Greener Pastures
Galli to join business-to-business player VerticalNet as CEO.
After rumors had swirled all morning, Amazon.com (AMZN) announced Tuesday that its president and chief operating officer, Joe Galli, is leaving his post after 13 months on the job. Galli will join business-to-business upstart VerticalNet as chief executive officer.
Galli came to Amazon in 1999 amid much fanfare, following a 19-year career at Black & Decker . He was much in demand after leaving the tool company over conflicts with CEO Nolan Archibald; in fact, he accepted a job as chief executive of PepsiCo's (PEP) North American division before changing his mind the next day and taking the Amazon job instead. In his year with Amazon, Galli was instrumental in expanding the e-tailer's scope far beyond books and music, to businesses such as home electronics, kitchen supplies, and of course, tools.
Financial considerations may have played a part in Galli's decision to leave. His contract called for a $3 million bonus on his first anniversary, which was last month, and his stock options are worthless because Amazon's share price is lower than it was a year ago.
VerticalNet, on the other hand, is up 150% over the past year, despite being well off its March highs. The company had focused on building online communities for different businesses, but now it's trying to increase revenues from business-to-business transaction fees. Galli's experience at Amazon should help with that transition. The timing of his decision to jump ship is somewhat surprising, but he may have wanted to avoid upstaging Amazon's widely anticipated earnings announcement on Wednesday.
David Kathman does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.