LogMeIn stock plummets after CEO details 'missteps' in GoToMeeting integration

Posted Date: 
30 Jul 2018
Source: 
Industry News Article
Boston-based enterprise software company LogMeIn Inc. saw $1.4 billion worth of its market valuation wiped away after a quarterly earnings call in which the CEO detailed "executional missteps" stemming from the company's $1.8 billion merger with GoToMeeting.
Shares of LogMeIn (Nasdaq: LOGM) fell 25 percent to $78.32 per share as of 2:50 p.m. Friday, marking a two-year low. The company's market cap was slashed from $5.45 billion to $4.08 billion.
The drop came after a conference call with investors during which CEO Bill Wagner explained that too many customers are deciding not to renew their subscriptions to GoTo products, the suite of corporate videoconferencing tools that LogMeIn acquired from Citrix in February 2017. Wagner said the problem emerged when enterprise customers who had signed up for a one-year contract around the time of the merger came up to the end of those contracts, and failed to renew.
Wagner said a number of changes that LogMeIn made to the terms, duration and renewal process of GoTo contracts "contributed to friction for our customers and made us harder to do business with." He said the company also failed to deliver on promised product upgrades and was slow to address problems with the software.
"We kind of did it to ourselves," Wagner said.