Struggling to retain its market foothold amid falling revenue and a series of quarterly losses, graphics chipmaker S3 today named a new chairman and chief executive.
Kenneth Potashner, who served as chairman, president and CEO at Maxwell Technologies since 1996, will replace S3's Terry Holdt.
Shares of S3 rose as high as 41 percent in afternoon trading following the news.
Holdt, who held the S3 role on an interim basis since returning from retirement last January, will remain S3 vice chairman.
"We wanted an individual with experience in a turnaround situation and one who had success in that arena," Holdt said. "We also wanted someone who had experience in the PC market and?someone who was used to running fast. With Ken's background in the disk drive business, we knew he could run fast."
Potashner led a turnaround while at Maxwell by increasing the company's market capitalization by 800 percent. He also previously served as executive vice president and general manager at Conner Peripherals Disk Drive Operations. And Potashner has held various management positions at Quantum, Digital, and Texas Instruments.
"What attracted me to S3 was the company's future prospects and the financial strength to execute upon them,'' said Potashner, in a statement. "I believe S3 has the right products, future roadmaps and an unprecedented ability to deliver the high volumes required in today's competitive market. Capitalizing on these strengths and working with its many talented people, I look forward to expanding S3's position in the mobile and desktop markets."
Potashner does have his work cut out. Last week, the graphics chip maker reported its second consecutive quarterly loss at $35.4 million for the third quarter, with revenue down 153 percent to $47.3 million.
Last year, S3 ran into trouble following the introduction of its new Virge chip, whose performance capabilities was but a poor cousin when compared to some of the company's competitors' chips already in the market. The company's latest offering, the Savage 3D chip, has fared better-yet the company hasn't shipped enough product to boost revenue.
Over the next four weeks, Potashner said he will determine whether to keep S3's focus on its core business, or continue some programs to expand the company's offerings. He added that corporate partnerships may be another consideration for the future.
"All those things are on the table at this point," he said.
When he was interviewed for the job, Potashner said his first view of the company was that it had been a "high-flyer" that had missed a product cycle.
"S3 focused on different applications in its heyday and it was a classical case of taking your eye off the core business," he said. Potashner added that he hopes to devise a strategy and execution plan by December.
Although the company has recently posted yet another quarterly loss, the new CEO said S3 has enough cash on hand to allow for flexibility in making acquisitions and developing any strategic plans.