San Francisco - Twitter’s directors and top executives are holding on to shares that they own and are committed to the business, chief executive Dick Costolo said at the microblogging service’s first shareholder meeting.
The company faced questions in the 37-minute meeting at the Hilton in San Francisco yesterday about restrictions on speech overseas, philanthropy and recent share performance.
Twitter’s stock price has declined by 50 percent so far this year, fuelled in part by a broader selloff in technology shares.
After the lockup period for insider shareholders expired on May 5, the stock slumped 18 percent.
“I’m really worried because that, to me, seems to be a message that employees don’t believe in the future of Twitter and people are the most important resource you have,” investor Gen Shibayama asked executives at the meeting.
“In a software company like Twitter, what’s your plan to keep people?”
Costolo said all board members, including co-founders Evan Williams and Jack Dorsey, pledged to hold onto their stakes amid the heavy selling, even after restrictions on their sale lifted six months after Twitter’s initial public offering.
“I love the fact that at the board level you haven’t seen a single share sold, as of or since the IPO,” Costolo said.
“We have a very clear plan and vision for what we all believe we can become.”
Twitter is trying to prove to investors that it can deliver on its promises of fast growth since a November 6 IPO.
Even though the company has boosted revenue with new advertising products, it hasn’t been able to add users as quickly as it used to, causing concern that future sales will slow.
Shareholder Meeting
All eight directors were elected to serve until 2017 at yesterday’s meeting.
Last month, Twitter said membership rose 25 percent in the first quarter, down from 30 percent growth in the previous period. T. Rowe Price dumped a quarter of its Twitter stake in the first quarter, ending March with 13.56 million shares, according to a May 15 regulatory filing.
Twitter’s first public shareholder meeting in June 2013 was less contentious compared with Facebook’s first annual meeting, in which chief executive Mark Zuckerberg faced the wrath of investors who had lost much of the money they put into the company at the time of its IPO.
The stock has since recovered. - Bloomberg News