WebMD CEO Resigns, Revenue Outlook for 2012 Lowered By 2%-8%

-- January 10, 2012: Wayne T. Gattinella resigned as CEO and president of WebMD as well as the company's board of directors, effective immediately.

CFO and COO Anthony Vuolo will serve as interim CEO while the board initiates a search for Gattinella's replacement.

The company also announced that a newly formed management committee would support Vuolo as interim CEO, in part by assuming the duties of COO until a new chief executive is hired.

Martin J. Wygod, chairman of the board of directors, said, "We thank Wayne for his contributions in making WebMD the leader in health information services. With my support and that of the Management Committee, I am confident that Tony will lead a smooth transition as the Board conducts a search for a new CEO."

While the company reaffirmed that its financial results for the fourth quarter and full year 2011 would be consistent with financial guidance announced in November 2011, WebMD's preliminary outlook for 2012 is that revenue may be as much as 2% to 8% lower than 2011 revenue. Revenues are expected to decline more in the first half of the year, with hope for improvement during the second half of the year.

Part of the problem, according to the company, is that expenses will increase by as much as 5% to 8% in 2012 as compared to last year. As a result, WebMD said that its 2012 Adjusted EBITDA and net income would be significantly lower than in 2011.

"While we face near-term challenges, I am confident that there is significant growth opportunity ahead for WebMD," said Wygod. "I believe that the pressures facing the pharmaceutical industry will ultimately prove to be the strong catalyst for a meaningful shift by them to digital marketing solutions. WebMD offers a cost-effective, efficient and highly measurable alternative to traditional detailing to physicians and mass media to consumers."

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