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Alphabet (GOOGL) Owned Google Fiber CEO McCray Steps Down

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The stream of high-profile exits continues for Alphabet Inc. (GOOGL - Free Report) as Gregory McCray, Chief Executive Officer (CEO) of its Google Fiber unit, has stepped down.

McCray joined the Alphabet division in February this year. Prior to this, he had worked as the head of another telecommunications company, Aero Communications.

Coming to the price performance, for the last one year, shares of Alphabet have been treading higher. The stock has returned 30.4% compared with the Zacks categorized Internet Services industry’s gain of 21.3%.

Is Google Fibre’s Future at Risk?

Lunched in Kansas City, MO in Sep 2012, Google Fiber is Alphabet’s high-speed Internet service. With the launch, the company intended to create pressure on major broadband providers like AT&T (T - Free Report) , Comcast and Verizon Communications (VZ - Free Report) to upgrade their networks to support higher Internet speeds.

However, last October, Google Fiber had to put on hold its plans of rolling out fiber-optic cables across a number of U.S. cities. The decision was part of the company’s revaluation strategy to focus on wireless technology as an alternative way to roll out high-speed internet to subscribers.

At that time, Craig Barratt, the head of Google Access, stepped down from his position and was replaced by McCray in February. Access is the Alphabet company that oversees Google Fiber and other similar communications efforts.

Now, McCray’s departure within five months of his appointment is definitely not a good thing for the company. The continuous leadership turmoil can raise questions on the future of the Access division.

However, to avoid any such fear from creeping in the minds of investors, Larry Page, CEO of Alphabet, said, “We are committed to the success of Google Fiber. The team is bringing gigabit connections to more and more happy customers. Fiber has a great team and I’m confident we will find an amazing person to lead this important business.”

Alphabet Inc. Price and Consensus

 

Alphabet Inc. Price and Consensus | Alphabet Inc. Quote

Zacks Rank

Alphabet carries a Zacks Rank #3 (Hold). Another better-ranked stock in the broader technology sector is Alibaba Group Holding Limited (BABA - Free Report) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Alibaba Group Holding Limited delivered a positive earnings surprise of 20.53%, on average, in the trailing four quarters.

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