Docker Inc. CEO swap has analysts anticipating a sale

The CEO who steered Docker Inc. past a company split in 2019 left this week, and a former Oracle exec has taken the helm, according to the company.

Scott Johnston

Scott Johnston spent 11 years at Docker, first as its chief product officer, and then as its CEO in late 2019 following the company's split and a spinoff of its Docker Enterprise business to Mirantis. Since then, the company has focused on its Docker Desktop and Docker Hub products, which developers can use to build containerized apps on local workstations.

Don Johnson, the founder of Oracle Cloud Infrastructure and a former executive vice president at Oracle Corp., is replacing Johnston. He began running OCI in December 2018, according to his LinkedIn profile.

After the 2019 split, Docker expanded its product line to include the following:

• Extensions for debugging, networking, vulnerability scanning and getting started with Kubernetes.
• Docker Scout for software supply chain security automation.
• Docker GenAI Stack and Docker AI.
• Support for shift-left testing through its acquisition of AtomicJar.
• Docker Build Cloud, which offloads container builds to hosted cloud infrastructure to boost the speed and flexibility of software development workflows.

Docker Inc. raised a $23 million Series B round of funding in 2021 and a $105 million Series C round in 2022, but also made multiple -- sometimes unpopular -- changes to product pricing and packaging in a bid to raise revenues.

Now, tech analysts see this week's CEO transition as a precursor to an acquisition of the software development vendor by a larger player, potentially one of the major cloud providers.

Docker has had a bumpy ride commercially since its early days, but it's hard to argue against its current momentum.

"I see it as, 'The ship has been stabilized over the last five years, the pivot to developer tools has been [checked] off, now let's go make some money,'" said Steven Dickens, CEO of HyperFrame Research. "Docker has had a bumpy ride commercially since its early days, but it's hard to argue against its current momentum."

Still, those commercial bumps haven't gone away, according to Dickens.

"It's a feature, not a product -- that has always been the problem," he said. Developers also have open source tools to choose from, such as Red Hat's Podman, or popular commercial offerings, such as GitHub Enterprise and GitHub Actions.

"It's not about revenue," Dickens said. "It's about filling a feature gap in a company's portfolio."

Docker Inc. said this week that 24 million developers use its products. That developer audience could be appealing to a bigger company looking to expand its share in the software development market, said Torsten Volk, an analyst at Enterprise Strategy Group, now part of Omdia.

"This CEO change shows they are planning to focus on partnerships, most likely with hyperscalers, to get into more accounts," Volk said. "While AWS, Azure, GCP and OCI offer competing services, they should be very interested in making their respective container services the preferred target for Docker container app deployments. And maybe one of them might be interested to snap up the whole Docker company, in the not too [distant] future."

A cloud provider or large enterprise software vendor might see Docker as a valuable asset to go after defectors from VMware Tanzu post-Broadcom acquisition, said Rob Strechay, an analyst at TheCube Research.

"With Tanzu being pulled into VMware Cloud Foundation after the Broadcom acquisition, there is more space in the container pipeline and security market," Strechay said.

Under a new CEO, Docker could "move more to full lifecycle management for containers, take on Ansible and HashiCorp more directly, and look to be bought by HPE, Dell or another [big vendor] that is looking to separate itself from VMware and has started down the KVM and containers route," Strechay said.

Similarly, according to Dickens, Atlassian, Red Hat or Microsoft/GitHub might look to broaden software development product lines by acquiring Docker.

"There's not an obvious buyer, in my opinion," he said. "What would it be worth? It depends on how it integrates with a company's other stuff."

A Docker spokesperson declined to comment on whether the company will seek a sale in an emailed statement to Informa TechTarget on Wednesday.

"What we can say is that this transition was entirely Scott's decision," the statement continued. "After more than a decade with the company -- five of those as CEO -- he felt this was the right time to bring in new leadership to build on the strong foundation he's created. The company is thriving, and this move ensures we continue on that trajectory."

Beth Pariseau, senior news writer for Informa TechTarget, is an award-winning veteran of IT journalism covering DevOps. Have a tip? Email her or reach out @PariseauTT.