Title: Activist Firm Takes Stake in Twilio, Pushes for Overhaul Amid Corporate Struggles
An activist firm, Legion Partners, based in Los Angeles, has taken a stake in Twilio, a technology company that specializes in facilitating communications between companies, customers, and employees through mobile devices. The firm has begun pushing for an overhaul of Twilio’s board and strategy, following a difficult year for the company.
Twilio shares have experienced significant fluctuations in value, gaining 45% this year but also losing more than 80% of their value in 2022. Annual revenue growth has also declined, slipping to just 5% in the most recent quarter.
In response to these challenges, Twilio CEO Jeff Lawson announced last week that the company would be laying off 5% of its employees, with a focus on cuts within its underperforming data and applications unit, which includes Segment.
The activist groups involved have urged Twilio to consider selling the struggling unit, prompting corporate reorganization and layoffs that have amounted to 17% of the company’s staff earlier this year.
Qatalyst, a prominent bank known for its mergers and acquisitions practice, has also become involved in the situation. Peter Michelsen, who heads Qatalyst’s activist practice, has been advising on activism defense, proxy fights, and complex ESG matters for Qatalyst’s clients. However, Qatalyst’s current involvement with Twilio is not necessarily indicative of an impending sale of the company.
Twilio has declined to comment on the matter, as has Qatalyst.
The company’s struggles come amid increased scrutiny and pressure from activist firms, reflecting broader challenges facing technology companies and the market as a whole.
CNBC’s Alex Sherman has contributed to this report.