Vonage CEO Rory Read will vacate his position on Thursday, February 1, 2024.
Read has held the position since July 2020 after taking over from Alan Masarek, the current Avaya CEO.
Most notably, he oversaw the CCaaS, UCaaS, and CPaaS company’s sale to Ericsson in 2021 for an eye-watering $6.2BN.
Yet, since then, Vonage’s fortunes have taken a turn, with year-over-year (YoY) revenue growth rising just two percent last quarter.
According to Francois Bouvignies, Director of Equity Research at USB, that is "well below" what Ericsson had originally expected.
In addition, Vonage suffered several high-profile setbacks in H2 of 2023.
In November, the Federal Trade Commission (FTC) announced $100MN in refunds to Vonage consumers, denouncing the vendor for making it difficult for consumers to cancel their subscriptions.
The enterprise communications also landed in hot water with the Australian Communications and Media Authority (ACMA) for breaching SMS anti-scam regulations.
Such setbacks preceded reports suggesting Ericsson has taken a $2.92BN hit on the acquisition.
Yet, a tricky macro-environment – which has also troubled many competitors – is likely the primary thorn in Vonage’s side.
Moreover, Ericsson maintains that the move is a long-term play, and incoming CEO Niklas Heuveldop doubled down on this. He stated:
I am thrilled but also humbled to be offered the opportunity to ensure that we leverage Vonage’s capabilities and the 5G innovation platform to their full potential – it’s a once-in-a-lifetime opportunity.
Bringing Vonage up to its full potential means differentiating its portfolio through mobility. Ericsson can do this through its deep wireless operator relationships and new 5G network API platform.