Twitter CEO Pressed by Elliott to Meet Lofty Growth Targets
- Dorsey gets a reprieve, but activist investor expects action
- Ad sales are at risk as virus threatens tweet-centric events
Jack Dorsey’s job at Twitter Inc. is still on the line.
On Monday, activist investors who had taken aim at the chief executive officer gave him a chance to prove that he should remain at the helm of the company he co-founded. The deal may only delay the inevitable, analysts said. Elliott Management Corp., known for aggressive moves to oust CEOs, essentially put Dorsey on a performance-improvement plan, committing him to meet metrics that would be challenging to achieve normally -- and may be impossible at a time when a viral contagion threatens global economic expansion.
Twitter, a social-media platform known for its short messages posted in real time, is most useful when people tune in online for live updates from events, news and sports matches. The company’s advertising strategy revolves around showing marketing messages to those who are logged in. A settlement with Elliott and private equity firm Silver Lake includes requiring Twitter to assign three new seats on its board to the firms, to post user gains of at least 20%, and to accelerate revenue growth and grab a bigger share of the digital-ad market.