Jack Dorsey steps down as Twitter CEO, report causes stock to soar

According to anonymous sources first cited by CNBC and corroborated in various reports Monday, Twitter co-founder Jack Dorsey will step down from his position as the company’s CEO. As of late Monday morning, Twitter itself has been quiet on the news. Dorsey did tweet “I love Twitter” early Sunday morning. He then tweeted what appears to be his resignation email to Twitter staff.

“There’s a lot of talk about the importance of a company being ‘founder-led.’ Ultimately, I believe that’s severely limiting and a single point of failure,” Dorsey wrote in the email. “I’ve worked hard to ensure this company can break away from its founding and founders.”

In the email, Dorsey announced Twitter Chief Technology Officer Parag Agrawal has taken over as CEO effective immediately. According to a person familiar with the matter who spoke to Reuters, the Twitter Board of Directors has been preparing for Dorsey to step down as CEO since last year.

Twitter’s stock, which has consistently underperformed the market, jumped more than 10% at the opening bell Monday before trading was halted. Shares of digital payments firm Square Inc., of which Dorsey is also chief executive, were up 3%.

The report comes as Twitter has accelerated the pace of its product innovation over the past year to compete with social media rivals such as Facebook and TikTok, the company is currently attempting to double annual revenue by 2023.

Early last year, Dorsey faced calls from Elliott Management Corp to step down as CEO of Twitter. The hedge fund argued Dorsey was paying too little attention to Twitter while trying to run both Twitter and Square. Dorsey got to keep his spot by giving Elliott and its ally, buyout firm Silver Lake Partners, seats on Twitter’s board.

This year, Twitter as a company has mainly been caught up in the heated political atmosphere leading up to the 2020 election. Dorsey defended Twitter’s decision to ban former President Donald Trump from the platform, saying the Jan. 6 Capitol riot and Trump’s tweets after the event resulted in a risk to public safety and created an “extraordinary and untenable circumstance” for the company. Trump later sued Twitter, Facebook and YouTube for alleged censorship. Early this month, Twitter caught the ire of Prince Harry, who said he warned Dorsey the day before the Capitol riots “that his platform was allowing a coup to be staged.”

This is not the first time Dorsey has stepped down as Twitter CEO. He initially became CEO in 2007, but was forced out the next year. Dorsey returned to the role in 2015.