ShoreTel Shuffles Cloud Division Management


ShoreTel is changing up leadership of its cloud division and moving its cloud chief -- the former CEO of M5 Networks -- to a role with a broader purview.

Dan Hoffman, president and general manager of ShoreTel's Cloud Division, will now be chief strategy officer for all of ShoreTel. Keith Nealon, most recently divisional vice president, revenue, will succeed Hoffman heading up the cloud business. Both moves take effect Feb. 1.

"Keith is committed to evolving the cloud division, deepening core values and rituals, strengthening systems and processes, and growing the people that have been at the core of our success," Hoffman wrote in a Jan. 31 post to the .

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Hoffman added that his own new job will "not be finding opportunities; it will be focus."

"It is going to be fun working on ShoreTel's overall strategy," Hoffman wrote. "The workplace is changing fundamentally, creating a disruptive need for mobile, cloud and unified communications technologies. We've got all three. There is new thinking about blending service and product offerings. We are strongly positioned with both."

ShoreTel acquired M5 Networks in March 2012 for about $146 million. The M5 business became ShoreTel's cloud division and its hosted communications services were branded ShoreTel Sky. Over the last two quarters, ShoreTel has been on-boarding partners to sell cloud-based VoIP and communications services.

ShoreTel's Cloud Division was a bright spot in its fiscal second quarter, with revenue of $17.1 million, up 9 percent from the first quarter. Recurring revenue is now 35 percent of ShoreTel's pie, according to the company. Premise-based business revenue for the second quarter was $57.5 million, down 1 percent from the previous year.

ShoreTel for its second quarter ended Dec. 31, 2012, reported overall revenue of $74.6 million, up 29 percent from the year-ago quarter. ShoreTel posted a non-GAAP loss for the quarter of $2.6 million, compared with non-GAAP profit of $1.4 million a year earlier.

PUBLISHED FEB. 1, 2013