Avaya removes Jim Chirico as CEO, plans cost cutting

Avaya Holdings announced the appointment of Alan Masarek as its President and CEO and said it will remove Jim Chirico from his positions.
Avaya for business communications
Avaya in a statement said Alan Masarek will succeed Jim Chirico, who will be removed from his positions as President and CEO of Avaya, effective August 1, 2022, and is resigning as a member of Avaya’s Board. Jim Chirico will remain employed with Avaya through August 16, 2022 and will work with Alan Masarek to ensure a smooth transition for all stakeholders.

Avaya did not reveal the reasons for the removal of Jim Chirico from the position of CEO. He was elevated for the CEO job five years ago.

Bill Watkins, Chairman of Avaya’s Board, said: “The Board and I thank Jim for his nearly 15 years of service to Avaya and wish him all the best in his future endeavors.”

Avaya expects revenue will be between $575 million and $580 million for the third quarter ended June 30, 2022, compared to guidance of $685 million to $700 million, and Adjusted EBITDA of between $50 million and $55 million, compared to guidance of $140 million to $150 million.

The company is also finalizing testing of its goodwill and intangible assets that is expected to result in significant non-cash impairment charges as of June 30, 2022. Avaya will reveal additional details on August 9, when it announces the financial result.

Avaya has initiated cost-cutting measures that are expected to primarily impact the company’s selling, general and administrative expenses, as well as discretionary spending. These actions are expected to generate between $225 million and $250 million in annual cost reductions beginning in the first quarter of fiscal 2023.

Alan Masarek most recently served as CEO of Vonage Holdings., where he led the company through an era of transformation from a VoIP-based residential phone provider into a global enterprise cloud communications company.

Prior to his time at Vonage, Alan Masarek was Director, Chrome & Apps at Google, following Google’s acquisition of his prior company, Quickoffice, where he served as Co-founder and CEO.

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