Shares of Twitter (NYSE:TWTR) are down 9.4% from last Friday's close, according to data from S&P Global Market Intelligence, as the social media platform confronts a future without CEO Jack Dorsey at the helm.
While investors initially cheered the executive's departure as he announced his decision to focus more of his attention on his other business, Square (NYSE:SQ), the market recoiled when Dorsey named his chosen successor, Chief Technology Officer Parag Agrawal. Agrawal is a 10-year company veteran, but investors indicated they don't believe an engineer is the leader the platform needs; Twitter shares subsequently sold off and have yet to recover.
Dorsey's divided loyalties between the two companies have been a point of contention from the beginning, but in recent months Dorsey's fascination with cryptocurrencies has increased sharply as Square announced it was emerging itself ever deeper into that world.
It was already involved with Bitcoin trading through TBD54566975, its Bitcoin-focused financial services segment, and had announced plans to build a decentralized Bitcoin exchange. Now with Dorsey giving his full attention to the company, he said he was changing Square's name to Block, an obvious nod to blockchain technology, and would also rename Square Crypto to Spiral.
Twitter still has its own problems to contend with and the market is doubtful Agrawal is up to the task.
While Agrawal's engineering background is useful in adding new functionality to the messaging platform (though there's still no edit button), that's not really where the issue with Twitter lies. As a social media platform, it's a medium for amplifying public and private discourse and generating revenue from the advertising surrounding that.
Twitter stock has been an abysmal investment since its 2013 initial public offering (IPO). It opened for trading that first day at $45.10 per share, and is now priced at $26 per share, meaning over the past eight years the platform is down 3% compared to a 158% gain by the S&P 500.
At a time when social media's importance is arguably at its apex, Dorsey's ineffectual leadership has ravaged investors. Now Twitter has a new executive with little to no experience in leading such a large, diverse platform who is tasked with turning it around.
For as much as Agrawal may be liked and respected at the company and within the community, that is cold comfort to investors and it's why they've beaten down Twitter's stock yet again.