Twitter COO resigns to join SoFi; its shares fell 3.9%
What's the story
At a time when Twitter is finally showing signs of a turnaround with more stability and growth, the social media company's COO Anthony Noto is leaving to take the top job at San Francisco-based fintech company SoFi. Noto will assume the role of SoFi's CEO in March. Following his resignation, Twitter's shares fell 3.9% to $22.41 in the biggest intraday decline since Nov'17.
Resignation
Crucial time for Twitter that's delivering positive results
Noto's departure comes at a delicate time for Twitter, which recently witnessed user growth after struggling for years. However, for many insiders, Noto's resignation wasn't surprising as he always wanted to be a CEO. At Twitter, his CEO dream wouldn't be realized; co-founder Jack Dorsey, who returned as CEO in 2015, has no plans to resign.
Details
Helped Twitter go public and directed its product vision
Anthony Noto joined Twitter in 2014 as the Chief Financial Officer. He previously worked at Goldman Sachs Group for nearly 15 years. Later, Noto was elevated to the post of Twitter's Chief Operating Officer to replace Adam Bain in Nov'16. As COO, Noto led Twitter's business divisions and played a vital role in shaping live-video streaming strategy, that's a "centerpiece" of Twitter's recovery.
Information
Other Twitter executives to assume Noto's responsibilities
After Noto's departure, other members of Twitter's leadership team will assume his responsibilities for business and revenue-generating operations. Meanwhile, Twitter's Vice-President of Global Revenue and Operations, Matt Derella, will continue to oversee the social media company's advertising sales efforts.
Blow to Twitter?
Noto championed live-video strategy, helping Twitter's recovery
While many feel Noto's exit will be a huge blow to Twitter, some people "with knowledge of Dorsey's thinking" say it wouldn't be a big threat to the company's turnaround efforts. In October last year, Twitter had beaten Wall Street's sales estimates after which at least six analysts upgraded their rating on Twitter, citing improvement in Noto-backed live-video strategy and increased user engagement.
Quote
Investors may not ascribe similar confidence in Noto's replacement
"He (Noto) has been reassuring force for investors even amidst the stock's volatile performance. Investors may not ascribe similar confidence in a replacement lacking the unique combination of established track-record within Twitter as previous Wall Street experience," said Evercore ISI Analyst Anthony DiClemente.
SoFi
SoFi CEO resigned due to sexual harassment allegations
Anthony Noto accepted the top job at the troubled online lending firm, SoFi (Social Finance Inc.). In Sep'17, SoFi's Co-Founder/CEO Mike Cagney stepped down amid allegations of sexual harassment as well as fraudulent actions. Since then, many top executives have left SoFi. Cagney wanted SoFi to be the "bank of the future"; however, after his exit, the future of the company is in trouble.
CEO Role
Anthony Noto to replace Tom Hutton at SoFi
After SoFi Co-Founder Cagney stepped down as the CEO last year, the company's Executive Chairman Tom Hutton assumed the role of Interim CEO. Once Noto joins, Hutton would reportedly become a Non-Executive Chairman of SoFi. On Noto becoming SoFi's CEO, Hutton said, "Anthony's deep understanding of technology, consumer, and financial businesses make him the perfect fit to be SoFi's chief executive."