Elon Musk's Selection of New CEO for Twitter to Benefit Tesla
Key Highlights :
Elon Musk's selection of a new CEO for Twitter may provide a much needed respite from the distractions that have been plaguing the billionaire and allow him to focus more on Tesla Inc. Shares of the world's most valuable electric vehicle maker, which have gained 40% this year, rose nearly 3% on Friday. The stock had its worst year in 2022, losing 65%, amid Musk's on-again, off-again offer for Twitter.
Since Musk bought Twitter in a $44 billion deal, Tesla investors have been worried that he may not be able to give his full attention to the company, which is in a price war with upstarts and legacy automakers. This is a fractional positive for Tesla shareholders because he will likely spend a little bit more time on Tesla, according to Gene Munster, Managing Partner at Deepwater Asset Management.
Musk said on Thursday he had found a new CEO for Twitter, without naming the person, and added that he was stepping aside to take on the role of chief technology officer at the company. Comcast Corp's NBCUniversal executive Linda Yaccarino was in talks for the top role at the social media platform, according to a source familiar with the matter. NBCUniversal said on Friday that Yaccarino was leaving the company.
Tesla investors are likely to celebrate this move too, with Musk's very hands-on approach at Twitter leading to concerns he had taken his eye off the ball at this EV giant, said Hargreaves Lansdown analyst Sophie Lund-Yates. Although Twitter has taken much of Musk's time since its takeover, he still actively manages several other businesses such as SpaceX and Neuralink.
Musk's involvement with Twitter has been quite chaotic. He has slashed thousands of jobs at the social media company, fired its top executive team, including its CEO, and has made many changes to its policies and strategy to rely less on ads and more on subscription money.
With the selection of a new CEO for Twitter, Musk may be able to focus more of his attention on Tesla Inc. This could be a much needed boost for the electric vehicle maker, which has been struggling with a drop in demand for its electric vehicles. The move may also enable Musk to devote more time to other businesses such as SpaceX and Neuralink, which could further benefit Tesla in the long run.
