The Mountain View, Calif.-based Internet software company said yesterday that CFO Fred Gerson will resign effective in October to pursue personal interests and to spend more time with his family. He will be replaced by Ken Owyang, Marimba's vice president of finance and controller.
Shares of Marimba today fell $11.25 to $18.63 on volume of 3.8 million shares, nearly 11 times the average daily volume. The shares traded as high as $74.37 last May.
John Puricelli, an analyst at A.G. Edwards, said the announcement rattled investors. "It's clearly fear," he said, adding that "they are promoting from within the company, so they don't have to go find another CFO."
Marimba CEO Kim Polese also indicated that investors overreacted. "(Gerson) is not jumping to another company, and he's not leaving in two weeks," she said in an interview.
"There is an unpredictable fluctuation in the markets right now," she added. "It's always difficult to interpret the psychology."
Marimba reported that it lost 1 cent per share in the first quarter, compared with a loss of 12 cents a share for the same period last year. Analysts surveyed by First Call expected the company to lose 2 cents a share.
The Internet software company generated $10.6 million in revenue for the quarter vs. $6.1 million for the same quarter last year.
Marimba produces software that makes the transfer of data, content and software over the Internet and within internal networks more efficient and reliable. For example, Vicinity.com uses Marimba's new product Timbale to assist the routing of information over hundreds of Vicinity servers.
Investors may have been concerned with an item in the earnings report showing that two customers each contributed at least 10 percent to the company's total revenue, down from three such customers in the previous quarter.
In four quarters as a public company, Marimba has reported two to three 10 percent customers every quarter. "It's the nature of growing a small company," Polese said of the fluctuation.