Twilio (TWLO) Co-Founder Jeff Lawson will be stepping down as CEO and from Twilio's Board of Directors amid pressure from activist investors. Khozema Shipchandler, who most recently served as President of Twilio Communications, will replace Lawson.
Shares of Twilio were up around 7% on the news.
In a regulatory filing announcing the CEO transition, Twilio also updated its fourth-quarter income and revenue forecasts. The company now expects fourth-quarter sales and non-GAAP income to come in above the top end of its previous guidance.
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Editor's note: This article was written by Luke Carberry Mogan.
Video Transcript
SEANA SMITH: We want to get to some breaking news. Twilio's founder, Jeff Lawson, announcing that he is stepping down as CEO. This is effective immediately. Now, the company's president of communications is going to be taking the reins as it struggles with two activist investors pushing for significant changes at the company. You're at least looking at the immediate reaction in shares, with the stock up just about 7%.
Of course, though, the question with this change-- we have Khozema Shipchandler who is going to be taking over for Jeff Lawson here, at least in the intermediate-- whether or not that's really going to do enough to satisfy the activist shareholders and exactly some of the changes-- activist investors and the changes that they have been pushing for now over the last several weeks. And Baird out this morning writing that, quote, "Some investors have been pushing for a change, given what we had been. Limited profitability and free cash flow, those metrics improved significantly over the past year." So again, some reaction that we're seeing in the share price today.
BRAD SMITH: Yeah, over 1.7 trillion interactions a year on behalf of 306,000 customers is what the company reiterated in its statement here. And that coming from now Jeff Lawson, who is going to be departing from the role.
But most notably here for Shipchandler and perhaps what this points out as they're battling some of these activist campaigns, as well coming off of a year where activist campaigns certainly had a lot of weight to throw around, whether that be at Disney, whether that be at some of the other household names, here for Twilio I think most notably, it comes back to what type of performance they're expecting from Shipchandler now in this position, a person that has spent over two decades at GE and driving a high-tech aviation division, plus growth in the Middle East region.
So perhaps that understanding of some of the business, the operations, the culture, that's going to perhaps come to more-- more to light here. But a larger question of where this will satisfy some of those activists out there too.
