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Twitter Shares Chirp Higher Following Analyst & Media Coverage Of COO Resignation

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Following Twitter's (NYSE: TWTR) announcement of the resignation on Chief Operations Officer Ali Rowghani, SunTrust analyst Robert Peck commented on the company's reshuffling.

Details on the Resignation

In an 8-K filing on Thursday morning, Twitter reported that Ali Rowghani has resigned from his position at COO effective Thursday.

The filing reported, "Mr. Rowghani will continue to be a Twitter employee and act as a strategic advisor to the CEO. Twitter does not intend to hire a replacement for the COO role, and all of Mr. Rowghani's operating responsibilities will be assumed by other members of the Twitter management team."

Is the Resignation Linked with Rowghani's Disagreement with Costolo

CNBC reported that sources said Rowghani was "effectively pushed out" following a disagreement with Chief Executive Officer, Dick Costolo, on what the COO role entailed.

The disagreement reports back to April following new hires of Google's Daniel Graph and new head of Engineering in May. Although these moves were necessary and beneficial for the company, the new employees were to report directly to Costolo and not Rowghani.

CNBC said, "there have been reports that Rowghani's sale of $9.5 million worth of his shares of Twitter stock rattled management but sources it tell me that this conflict was really about Rowghani should be doing and what Costolo wanted to take responsibility for himself."

SunTrust Comments on the Resignation

Analyst Robert Peck remarked, "This does not come as a surprise, as Twitter has recently made several big moves in Product and Engineering (2 important areas he had been running). Google Maps executive Daniel Graf was recently hired to head Product (replacing Michael Sippey who left in January), while Twitter VP (Alexander Roetter) was recently promoted to head engineering (replacing Chris Fry)."

SunTrust noted that Twitter's product innovation has not maintained the expected pace by management and investors. The analyst believes the "reshuffling makes sense" and remains neutral on the company's financial guidance.

Stock Acton

Shares of Twitter are trading higher by $1.61 at $37.23 in Thursday's session.

Latest Ratings for TWTR

DateFirmActionFromTo
Nov 2019DowngradesIn-LineUnderperform
Oct 2019MaintainsHold
Oct 2019MaintainsNeutral

View More Analyst Ratings for TWTR
View the Latest Analyst Ratings

Posted-In: 8-K Filing Ali RowghaniAnalyst Color News Management Events Analyst Ratings Media

 

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