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What Twitter COO Ali Rowghani's departure means for the company

What Twitter COO Ali Rowghani's departure means for the company (Part 1 of 3)

Why Twitter’s chief operating officer, Ali Rowghani, resigned

Twitter’s COO resigns

Yesterday morning, Ali Rowghani, Twitter’s  (TWTR) chief operating officer, or COO, resigned from his post. A filing from Twitter states that Rowghani will remain a Twitter employee and serve as a strategic advisor to the CEO, Dick Costolo. Twitter doesn’t intend to hire someone to fill Rowghani’s role. Other Twitter management will take over the COO responsibilities. Rowghani had assumed the COO role in December 2012 and had also served as Twitter’s chief financial officer from March 2010 to December 2010. Prior to that, Rowghani had been the chief financial officer at Pixar.

2014.06.12 - Twitter Mgmt TeamEnlarge Graph

According to other sources (such as re/code’s coverage of Twitter), the company has been reshuffling its senior management, with some of Rowghani’s responsibilities already reassigned before his departure. So, while Rowghani’s departure perhaps wasn’t completely unexpected, it’s still striking to see a major executive leave Twitter less than a year after its IPO. The bottom line is that when things are going well, there’s usually no need for management shakeups. Rather, companies tend to prefer continuity at the executive level. Changes in senior staff, especially so soon after an IPO, usually mean something is wrong and new personnel need to come in to fix it.

Twitter is a minor component of some tech and Internet ETFs, such as the Vanguard Information Technology ETF (VGT), the Social Media Index ETF (SOCL), and the First Trust DJ Internet Index Fund (FDN). Twitter is also a small component of the First Trust US IPO Index ETF (FPX).

Continue to the next part of this series to see what’s been causing Twitter’s stock price to flag.

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