McQuary Resigns EarthLink Post

EarthLink Inc. said Monday that President Mike McQuary resigned for personal reasons.

The announcement came only weeks after the Internet service provider posted a wider-than-expected first-quarter loss.

The move jolted investors, sending shares of the Atlanta-based company down 11%, or 87 cents, to $7 on the Nasdaq Stock Market.

“The stock is off sharply because it is a shock of an announcement but as people filter through the announcement and realize there’s not another coming later and it is what it is--McQuary leaving because his job was done and done very well--the stock should rebound,” said Frank Gristina, analyst at SunTrust Robinson Humphrey, who has a “buy” rating on the stock.

Youssef Squali, a FAC Equities analyst who also rates EarthLink a “buy,” said McQuary’s resignation “as far as we can tell, is driven by both personal reasons--he recently [had] triplets--as well as professional ones, as EarthLink has been moving toward a less top-heavy management structure.”

The company is not searching to fill his position, leaving Chief Executive Garry Betty to assume McQuary’s day-to-day responsibilities, a company spokesman said.

McQuary came on board when EarthLink merged in early 2000 with rival Internet company MindSpring, where he was the chief operating officer.

Some analysts said McQuary’s resignation suggested that the integration of MindSpring and EarthLink was finally complete.

McQuary also resigned as an EarthLink board member.

He will contribute to special projects for CEO Betty and EarthLink.