Twitter Inc shares were up on Tuesday after a long bear run as rumors emerged that Facebook’s Sheryl Sandberg would be brought in to the firm as CEO. Twitter lost CEO Dick Costolo on July 1, and shares have slid back to IPO levels as investors worry that the firm’s leaders are not able to turn the firm around.
Twitter said that its next CEO should have good knowledge of the platform. That doesn’t exactly fit Sandberg, but her experience at Facebook Inc should be enough to cover the firm from shareholder complaints. A lot of Twitter rumors have come and gone in recent months, and there’s little reason to believe this one over the others.
Twitter looks to Sandberg as CEO
Trading volume in Twitter remained normal on Tuesday despite the rumors that Sandberg would be named as the head of the firm. Those with shares in the firm may not be excited about her so much as they’d be excited about any movement in the firm after the losses of recent days.
In the last five days of trading Twitter has lost close to 17 percent of its value. After revealing its earnings numbers for the three months through June, the firm’s leaders were less than hopeful about the medium term future.
Stop-gap CEO Jack Dorsey and CFO Anthony Noto confirmed that they were looking at a long turn around before being able to spark user growth once more. Sandberg has lead Facebook through a period of incredible user growth, and has combined that with a wealth of ad sales.
Facebook is now one of the most valuable firms in the world after a drive toward growth in both user numbers and ad sales. Twitter could do with getting a little bit of that magic to rub off on it, and Sandberg, who has a close relationship with Facebook CEO Mark Zuckerberg, may be the firm’s attempt to do just that.
Don’t believe everything on Twitter
The talk about Sheryl Sandberg joining Twitter is just talk for the time being. Wall Street has had great love for stories about how Twitter would be bought out or would bring various people in to lead it over the last couple of months. None of those rumors has stepped into reality this year.
There’s little reason to think that Sandberg would leave Facebook in order to join Twitter just yet. Those with shares in the firm, and those looking to make money on a quick pop, will still have hope, however.
SunTrust Robinson Humphrey analyst Robert S. Peck, in a report published on Monday, said that “Twitter is believed to be looking for candidates who have a deep knowledge of the product, an active user of the service, a product expert, innovative, a proven leader, with business/monetization strengths and able to dedicate 100 percent of their time, available and willing to engage in a turnaround and an inspiration for employees and investors.”
Sheryl Sandberg seems to fit the bill on most of those points. Mr. Peck wrote that without a new CEO a “sustained “brain drain” of talent” was likely to continue.