Jim Whitehurst resigns as IBM president; shares dip most in 5 months

No replacement for Whitehurst has been announced yet, the IBM said, adding he will continue to work as a senior adviser for the corporation. Whitehurst was appointed as IBM’s president last year.

Jim Whitehurst has announced he is stepping down as the president of IBM. Whitehurst's resignation is being seen as one of the several management moves the IBM announced on Friday, according to news agency Bloomberg. The 53-year-old’s exit led to shares of the technological giant falling 4.8 per cent to $139.83, the most in five months, Bloomberg reported.

Jim Whitehurst's departure is one of the first major corporate reshuffles under Arvind Krishna, who was appointed as IBM’s CEO in 2020. (REUTERS)

No replacement for Whitehurst has been announced yet, the IBM said, adding he will continue to work as a senior adviser for the corporation. Whitehurst was appointed as IBM’s president last year. This was the first time in decades that the corporation split up the designation of a chief executive officer (CEO) and president.

His departure is one of the first major corporate reshuffles under Arvind Krishna, who was appointed as IBM’s CEO in 2020. Krishna, who has been a long term serving employee of IBM, has laid emphasis on growing technologies such as Cloud computing services and artificial intelligence (AI) in order to revive decades of stagnation, Bloomberg reported.

A Masters of Business Administration (MBA) graduate from the prestigious Harvard Business School (HBS), Jim Whitehurst earlier served as the vice president and director of the Boston Consulting Group, the chief operating officer (COO) of Delta Airlines and the CEO of the American software multinational Red Hat Inc.

IBM announced in 2018 that it was acquiring Red Hat Inc in a 33$ billion deal orchestrated by Arvind Krishna, following which Red Hat became a subsidiary in July 2019. It has been observed that Whitehurst played an extremely important role in the IBM-Red hat integration.

Whitehurst's decision to step down as the president has sprung a surprise among analysts. “This feels like a setback given the fact that Jim was expected to have an important role in the transformation initiative of IBM,” Moshe Katri, an analyst at Wedbush Securities, told Bloomberg.

On the other hand, the CEO of a top partner of the IBM told magazine crn.com that Whitehurst’s news came out of nowhere and also posed a question as to who will ensure the IBM-Red hat integration does not go off track.

(With Bloomberg inputs)