Why did the Atomos share price just tumble 16%?

What did Atomos announce to the ASX?

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Key points

  • Atomos shares sink 16.11% to 75.5 cents 
  • The company announced the sudden conclusion of its CEO, Estelle McGechie 
  • In the interim, Atomos chief technology officer, Trevor Elbourne will assume the top job 

The Atomos Ltd (ASX: AMS) share price is losing ground today following the surprise conclusion of a senior leadership figure.

During mid-afternoon trade, the video technology company's shares are down 16.11% to 75.5 cents.

Atomos appoints interim CEO

Investors are selling Atomos shares after the shock announcement that its CEO, Estelle McGechie will no longer serve in the role.

According to the release, Ms McGechie has yet to relocate to Australia, which is a requirement for the top job.

Atomos stated that its CEO must reside in Melbourne where its headquarters is based.

As a result of the departure, Atomos chief technology officer, Trevor Elbourne will assume the CEO role for the interim.

Mr Elbourne, who lives in the Victorian capital, is expected to launch the company's new products later this month. He and his team have been diligently working on improving video production workflows for the last two years.

Notably, Mr Elbourne is one of Atomos' founding employees, having joined the company in 2012. Since then, he has played a vital role in determining Atomos' technology strategy and product roadmap.

In 2017, Mr Elbourne was appointed chief technology officer and oversaw the successful development of Atomos' flagship Ninja V and Shinobi products.

The board advised it will commence a global search process for a permanent appointment.

Atomos reconfirmed its FY22 guidance for revenue of $95+ million as well as an EBITDA margin of 12% to 15%.

Atomos' non-executive chair, Chris Tait touched on the CEO change saying:

I would like to thank Estelle for her efforts at Atomos and on behalf of the Board wish her the best in her future endeavours.

Trevor is a logical and highly capable appointment as interim CEO given his intimate knowledge of the products and technology that have made Atomos one of the global leaders in video technology today.

As the Company embarks on an exciting expansion of our product line-up, the Board is confident Trevor will bring his deep experience in technology innovation to ensure our products continue to meet the changing needs of our growing customer base.

About the Atomos share price

Over the past 12 months, Atomos shares have lost 25% in value, with year to date dropping around 30%.

Based on today's price, Atomos has a market capitalisation of roughly $168.98 million.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended Atomos Ltd. The Motley Fool Australia has recommended Atomos Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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