After 10 years at the helm of 3Com Corp., Eric Benhamou resigned today as CEO, effective Dec. 31. Benhamou said 3Com needs revitalized leadership.
At 3Com's annual shareholder's meeting, Benhamou said he has nominated Bruce Claflin, 3Com president and chief operating officer, to replace him. Claflin, who's been at 3Com for two years, joined the company after holding positions at Digital Equipment Corp. and IBM, where he spent more than two decades. Benhamou said he will continue as chairman and that he will also lead a special 3Com technology committee formed to promote the company's technologies and products.
After struggling for several successive quarters, 3Com's financial picture is beginning to brighten, largely as the result of its recent restructuring. In the first fiscal quarter of 2001, 3Com posted total sales of $806.3 million, up 20% from the same period a year earlier, although the company posted a net loss of $41.3 million for the quarter.
"3Com has been going through some difficult transitional issues, although they have most of the difficult actions behind them," says Greg Collins, a director at market research firm Dell'Oro Group. "They're starting to look forward to better performance, and we think they'll rebound rather rapidly from some difficult quarters," Collins said. Sales of the company's broadband products, especially its cable modem and digital subscriber line equipment, are helping return the company to higher sales growth, says Collins.
In his announcement, Benhamou said 3Com is ready for fresh leadership now that the company has nearly finished a restructuring begun in June. 3Com exited certain nonstrategic businesses and redirected its efforts to higher-growth sectors. In May it initiated the divestiture of its hugely successful Palm handheld business. Following that, it shed its analog modem business and the LAN and WAN core-chassis business.