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Twitter Inc. (TWTR): The Good and the Bad about Dick Costolo Leadership Style

Twitter Inc. (NYSE:TWTR) has been at crossroads this year to explain its vision amidst concerns that the company’s growth might have stagnated after going public. In a series of meeting after Twitter hit lows in May, CEO, Dick Costolo, is reported to have devised a plan that he believed would have an impact in turning around the fortunes of the company.


Costolo reportedly instructed the company’s managers to focus their attention not only on core users. But also on people who visited the network but didn’t log in as well as those people who saw Twitter’s content embedded in other sites. The CEO believes Twitter’s future success will depend on how the three groups are addressed instead of having to focus on one set of group. One thing which can console investors would be that Twitter continues to be one of the most used social media websites.

Costolo is also urging the press to stop comparing Twitter Inc. (NYSE:TWTR) to Facebook Inc. (NASDAQ:FB) as its monthly active users currently stands at a fifth of its main rival. The strategy shift came six months after the company went public with close and former employees describing Costolo as a reactive thinker who has the tendency of shifting from one idea to the next. The sentiments essentially raise concerns on Costolo’s ability to devise a strategy and stick to it, till the end.

The tendency to bounce from one idea to the next served Twitter Inc. (NYSE:TWTR) well heading into the IPO, but the same has not worked one year into the IPO. Some people are of the opinion that the scrutiny of running a public company might have played a big role in Costolo struggling to convey a consistent vision for the company.

Twitter Inc. (NYSE:TWTR) has been below par this year even though it is trading above its $26 a share IPO price. Revenue doubled in the third quarter to a high of $361 million, but a widened loss of $175.5 million continues to be a point of concern. Investor’s pressure continues to mount on Costolo with the exit of some who held huge stakes.

Product and management changes continue to be some of the reasons why some investors have opted to stay away from the stock. Unexplained decisions or abrupt management changes are reportedly not going well with other executives and a reason behind reduced morale or defections at lower levels.

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