Analysts agree VMware COO Sanjay Poonen is the ‘obvious choice’ to replace departing CEO Pat Gelsinger (VMW)

VMware COO Sanjay Poonen

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With VMware CEO Pat Gelsinger departing to become Intel’s new CEO in February, analysts say that there’s one clear, logical choice to replace him: VMware COO Sanjay Poonen.

VMware announced Wednesday that Gelsinger, who has served as CEO for over eight years, will be stepping down, effective February 12, to join Intel as CEO. It’s something of a homecoming for Gelsinger, who previously spent three decades at Intel, including five years as its CTO.

He will continue to serve on VMware’s board of directors, which has kicked off its search for a new CEO while VMware CFO Zane Rowe serves as the interim exec. 

Gelsinger will be a hard act to follow: Analysts worry that the seasoned CEO’s departure represents a major blow to VMware, with Piper Sandler slashing its price target for the company’s stock from $178 down to $157.

Still, several analysts immediately jumped to Poonen as Gelsinger’s best replacement. Poonen has worked at VMware for over seven years, where he currently leads customer operations and the security business as COO. 

“Sanjay Poonen, COO at VMware, is the obvious choice, and I would be very, very surprised if the board doesn’t nominate him as CEO,” Patrick Moorhead, Moor Insights & Strategy founder and principal analyst, told Insider.

VMware declined to comment on analyst predictions around Poonen, but said that its board is “committed to a thorough global executive search process of diverse candidates.” Here’s why analysts favor Poonen, as well as the challenges the company faces moving forward:

Why analysts say Poonen is the ‘most logical candidate’

Before joining VMware, Poonen spent time at Symantec, Informatica, Apple, Microsoft, and SAP, with VMware poaching him from the latter in 2013 to lead its End-User Computing division, where he drove the firm’s acquisition of AirWatch and more than tripled the size of the business — from $300 million to $1 billion — in three years, according to his LinkedIn profile. The company promoted him to chief operating officer in 2016. 

“Poonen has a stellar track record at VMware of leadership and execution,” Moorhead said. “There’s literally no reason that Poonen wouldn’t be selected.”

Managing director at Wedbush Securities, Dan Ives, said that Poonen’s experience makes him the “most logical candidate” as he understands the business “strategically.” 

“He understands VMware as well as anyone, has credibility on the street, and would be a strong replacement,” Ives said. “I think he’d be a plug-and-play CEO with Gelsinger leaving.”

Poonen has been groomed to be CEO for some time, said Maribel Lopez, founder and principal analyst of Lopez Research, and has previous experience in both operations and product development.  

“He has a lot of experience in his work in companies of the same size and scale before,” Lopez told Insider. “It makes sense that it would be someone like him. That would be the person who would be top of the running.”

Besides running much of VMware’s business, Poonen has also become the face of VMware much like Gelsinger has, says Forrester vice president and research director Glenn O’Donnell. For …read more

Source:: Business Insider


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