Employees loved him. The board loved him. He charmed the media, and even Wall Street, for a brief honeymoon. Why did investors turn on Twitter’s CEO?
It took Wall Street exactly two months and two days to fall out of love with Twitter. On November 7, 2013, the company had the smoothest tech-industry IPO since Facebook’s faceplant of a public debut, and its chief executive Dick Costolo, who oversaw the flawless road show, share allocation, pricing, and listing, was praised as a champion executor. Twitter TWTR 5.69% stock soared 73% on its first day of trading.
Twitter’s Strategy Remains Unclear Even After CEO Resigns
Investors applauded Twitter CEO Dick Costolo’s resignation. But did they jump the gun?
Investors initially applauded the news that embattled Twitter CEO Dick Costolo would be stepping down.
It was, after all, under Costolo’s watch when this social media icon’s once-enviable growth began to slow, raising doubts whether Twitter TWTR 5.69% would ever follow in the footsteps of Facebook FB -0.26% and dominate online and mobile advertising.
But then Jack Dorsey — Twitter’s co-founder and chairman who was just named interim CEO — opened his mouth.
Twitter Shares Head Toward All-Time Low
As part of the shake up that put Jack Dorsey into the CEO chair at Twitter Inc. (NYSE: TWTR), and the deep concern that he cannot turn it around, the social media company’s shares are barely above their all-time low. It will only take a bit of bad news to get them down there. he first and foremost concern about Twitter’s future is that it cannot turn its 300 million user base into revenue.
The worry is fair enough. Advertisers have moved to buying advertising on larger Facebook Inc. (NASDAQ: FB) and on LinkedIn Corp. (NYSE: LNKD), which marketers have found effective. By contrast, putting ads in a stream of tweets has left marketers cold.
It may be that the ads pass down the page so quickly in a normal consumer Twitter feed that they are actually pushed out of the way by tweets from the people or companies that Twitter users want to follow.