Twilio TWLO continues to face activist pressure, as Anson Funds and Sachem Head demand deeper changes despite a recent board shakeup. For more than a year, the company has been facing pressure from activist investors like Anson Funds and Legion Partners Asset Management to improve its financial performance.
Activists asking Twilio stockholders to change its board director terms to one year from three starting the next year. The board will be reduced to nine members from 10 after Byron Deeter, announced that he will not seek reelection at its next annual investor conference. In January Jeff Lawson, Twilio’s CEO and founder resigned, Anson Funds called it “a step in the right direction”.
Sagar Gupta, Anson Funds Portfolio Manager and Head of Active Engagement noted:
“After discussions between Anson Funds and Twilio representatives, the company’s Board announced the departure of director Byron Deeter and a proposal to declassify the Board. These changes were based on Anson Funds’ recommendations. They came after our insistence to the Board that more actions were needed to position the Company and its stockholders for success following the news of the agreement with a new stockholder on April 1, 2024. While this agreement is a positive change, in our view it was not enough to prevent the continued entrenchment of the Board and ensure an end to Twilio’s persistent underperformance.
Twilio Stock Performance
Twilio reported fourth-quarter revenue of $1.08 billion, an increase of 5% and 8% organic year-over-year. The loss from operations came at $361.7 million for the 4Q of 2023, compared with a loss from operations of $218.6 million for the 4Q of 2022.
Twilio stocks have underperformed in 2024 with losses of 21.75% while the Nasdaq Composite has gained 6.91%. TWLO stocks have a 52-week stock price range between $45.02 and $78.16, the company’s market capitalization stands at $11.1 billion.
The technical picture has deteriorated since February and now the stock is trading below the 50 and 100-day moving averages.
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