Chuck Swoboda, who led the transformation of Cree from a producer of LEDs into a lighting company that makes its own LED bulbs andlight fixtures, is stepping down as CEO.
Durham-based Cree announced Friday that Swoboda, 50, will step down as chairman, president and CEO of the 6,400-employee company after a successor is named. Once a new CEO is hired, the company said in its announcement, Swoboda “will remain available as a consultant to the company to ensure a seamless transition of leadership responsibilities.”
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Swoboda, who joined Cree in 1993, has been CEO since 2001 and chairman of the board since 2005.
Swoboda said in the announcement, “My decision to change my work-life balance follows a recent medical issue, which was resolved, and which caused me to reevaluate my priorities.”
Cree’s board of directors plans to retain an executive search firm to help find a new CEO.
The change at the top comes at a trying time for Cree. The company has been struggling with declining revenue stemming from slack demand as well as internal issues. Last year’s conversion to a new software system disrupted customer service and had a longer-term impact on sales.
“I believe that this is a good transition time for Cree as we have three core businesses poised to enter another phase of accelerated growth,” Swoboda said in the prepared statement. “I know that under its next CEO, Cree will continue to disrupt markets with new technologies and superior-performing products that deliver great value to our customers while consuming less energy.”
Cree spokeswoman Claire Simmons wrote in an email that Cree isn’t saying anything beyond its announcement right now and that Swoboda wasn’t available for an interview.
Bob Ingram, lead independent director of the Cree board, praised Swoboda in a prepared statement, noting that “his passion for the business and focus on innovation has helped transform industries and has enabled the company to achieve an eight-fold increase in revenue.”
Needham & Co. analyst Edwin Mok wrote in a research note that Swoboda’s pending departure could lead to a spin-off of the Wolfspeed subsidiary, which also is headquartered in Durham.
Mok noted that if Cree hires a CEO with an extensive background in lighting, the new executive may decide to divest non-core businesses. Wolfspeed’s power components are used in computer servers and uninterruptible power supplies and for solar energy. Its radio frequency transistors are used in radar and telecommunications systems.
In February, Cree pulled the plug on its planned $850 million sale of Wolfspeed to Europe’s largest semiconductor company, Infineon, after the U.S. government raised objections on grounds of national security. At that time Cree, which previously had planned to spin off Wolfspeed before negotiating a deal with Infineon, decided to focus on expanding the subsidiary.
Mok noted in his research note that a “lack of leadership in the company could create disruption that might impact growth or profitability in the near-term.”
Mok couldn’t be reached for additional comment.
Cree shares closed at $23.09, up 6 percent, on Friday. Cowen & Co. analyst Jeffrey Osborne told Bloomberg News that investors likely were reacting to the company’s reaffirmation of its previous outlook for its next fiscal quarter, which it also issued on Friday.