Twitter CEO Jack Dorsey Survives Elliott Ax As Company Offers Concessions

Twitter Inc TWTR CEO Jack Dorsey is set to continue at the helm of the company after a board committee appointed earlier this year to look into leadership and succession recommended that the current management stays in place.

What Happened: The committee, formed with the cooperation of activist investor Elliott Investment Management, also recommended certain changes that would give investors a larger voice in the social media firm’s corporate governance, Twitter said in filing with the U.S. Securities and Exchange Commission. 

Patrick Pichette, Alphabet Inc GOOGL GOOG subsidiary Google’s former chief financial officer, chaired the committee, which also had independent directors — Jesse Cohn, Egon Durban, Martha Lane Fox, David Rosenblatt, and Bret Taylor — as members.

The committee recommended that Twitter add a proposal to the 2021 annual stockholder’s meeting to amend the company’s bylaws and certificate of incorporation so as to eliminate classified board structure.

Why It Matters: In March, Elliott and Twitter came to an agreement under which the latter would buy back $2 billion or 7.9% of its stock.

Elliott’s Cohn and Silver Lake’s Durban were appointed to the social media company’s board under the deal.

Dorsey who also leads Square Inc SQ, found support from Tesla Inc TSLA CEO Elon Musk who said on Twitter, “Just want [to] say that I support [Dorsey] as Twitter CEO. He has a good [heart].”

In late October, Twitter reported third-quarter earnings of 4 cents per share, which missed analyst consensus of 6 cents by 33.33%.

Third-quarter daily active users amounted to 187 million, an increase of one million from the previous quarter and 145 million in the same period last year.

Price Action: Twitter shares closed nearly 4.6% lower at $39.47 on Monday and rose 1.11% in the after-hours session.
Photo by JD Lasica on Flickr