VeriFone CEO Bergeron to Step Down; Shares Jump

VeriFone Systems Inc. (PAY) Chief Executive Douglas Bergeron is stepping down after a dozen years at the helm of the card-payment systems maker, and will be succeeded on an interim basis by Chairman Richard McGinn.

Shares jumped 8.8% to $22.25 after hours. Through the close, the stock was down 31% since the start of the year.

The company said it has formed a search committee headed by director Alex W. Hart to evaluate potential candidates, and will engage an executive search firm during the process.

"Doug Bergeron has led VeriFone since 2001 and overseen its transformation into an industry leader," said Mr. McGinn, who has served on VeriFone's board since 2008 and was named chairman in 2012.

He added that the company intends to focus on leveraging its product and service portfolio, while reinforcing its strength in the electronic payment systems industry.

"I am confident that our search committee will identify a new leader who will bring a fresh perspective and enable us to achieve our full business potential," said Mr. McGinn.

No reason was given for Mr. Bergeron's departure. The departing CEO said that the timing was right for new leadership.

Leslie Denend, who joined VeriFone's board in 2005, will become interim chairman.

The leadership change comes at a time of relative weakness for the company, which some analysts have blamed on its efforts to change the way it makes money. VeriFone has historically been a hardware company, getting bulk one-time payments from selling its machines, which allow merchants to accept credit and debt card payments. It has sought to instead give away or subsidize more machines, and then receive monthly fees for its services. The changes, which were intended to deliver better profits, have hurt financial results and allowed its main competitor Ingenico SA (ING.FR) to steal market share.

VeriFone reported last week that it swung to a fiscal first-quarter profit as it managed to post stronger margins and services revenue, though product sales slumped.

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