RBC's Mark Mahaney Weighs In On Twitter's Change Of Guards And How It Will Impact The Stock

Twitter Inc TWTR announced late on Thursday that its CEO Dick Costolo will be stepping down on July 1 and Jack Dorsey, co-founder and chairman of the company, will be taking up Costolo’s position on an interim basis.

RBC Capital’s Mark Mahaney was on CNBC Friday to weigh in on this.

A Very Hard Job

“The story remains the same which is that this is a company and a brand that’s got ubiquitous reach, but a lot of execution challenges,” Mahaney said. “I’ve never seen as much sea level turnover in a company in the 18-months post an IPO as you have got now with Twitter. CEO, CFO, CMO, COO, it’s very unusual. So, somebody is going to have to come in probably needs an external voice, probably needs somebody who can do both, the product side of the business and the advertiser side of the business.”

He went on, “probably somebody, already a public company CEO. That makes it a pretty short list of people who could come in and turn this around. And there’s also, it’s going to take quite some time that’s probably an year, an year and a half turnaround that’s a very hard job. We don’t recommend the stock here.”

Not The Right Solution, But Will Fire The Tubes

Mahaney was asked if Jack Dorsey remains the CEO of Twitter, will it give him more hope about the company or less. Mahaney replied, “It’s actually a little disappointing from our perspective that he is not more publicly enthusiastic about taking on the CEO responsibility. Some of the greatest wealth creators in this internet technology space have been the founder, CEO types. Think Amazon, think Google, think Netflix.”

“Jack Dorsey coming in will probably really inspire a lot of the employees at Twitter. So, it’s a little odd that he is kind of equivocating here about the coming in full board to take on the job…He may not be the right solution, but certainly in terms of firing up the troops, he would be the solution,” Mahaney said.