Dec 19, 2022
Twitter Users Vote Elon Musk Out as CEO Transcript
Yahoo Finance Live anchors discuss Elon Musk’s latest Twitter poll findings that voted him out as the platform’s CEO. Read the transcript here.
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Brian Sozzi (00:02):
Stay on all things weird here to kickoff this week. People have spoken. Elon Musk Twitter poll closed this morning and where he asked users over the weekend whether or not he should step down as the CEO of the platform promising he’ll abide by the results. Well, the results are in folks, and Musk has a history of following through on Twitter polls. You can see the results of that poll. Overwhelming amount of Twitter users, 17.5 million votes on this say that he should step down as Twitter. Now, we’re seeing Tesla shares pop in reaction in the pre-market. Sentiment is clear. Tesla investors want to see a more focused Elon Musk, and that might mean that he has to just hand over the reign to someone else at Twitter, whoever that might be.
Brad Smith (00:39):
He has a history of following through on Twitter polls, but not all of it is directly because of the result of the poll itself. Some of it is premeditated and already a decisive course of action that perhaps he’s already mulled over and has decided himself to take even before presenting it to the public. Some of that has been share sales in the past or even just making different upgrades to some of the different technology within Tesla vehicles. But for Tesla shareholders, they have been upset by about how much of a headwind that this has proven to be just the amount of time and the spectacle of Twitter.
Brian Sozzi (01:13):
And just quickly here, this is unlikely to happen today. This guy just spent $44 billion to buy an asset like this. In an ideal case, he will have laid out a framework, some form of management framework to who lead this company. I wouldn’t expect to see an SEC release at some point today saying he’s stepping down his Twitter. I mean, I can’t imagine.
He wouldn’t have to put out an SEC release. Remember?
Brian Sozzi (01:33):
Well, you have to put out something.
It’s a private company, you don’t have to do anything. That’s the joy in paying … He would not have to file with the SEC for management change
Brian Sozzi (01:42):
Isn’t there debt? Public traded debt?
I don’t think he would have to file.
Brad Smith (01:47):
Fair point. [inaudible 00:01:47].
I don’t think he would. He would probably tweet about it. Listen, he’s not going to put a poll out there unless he wants to do it. It’s not like he’s leaving it up to the users of Twitter whether he is going to step down or not. Is he maybe polling the Tesla board, or maybe they’re pushing him in a particular direction? Maybe. I mean, we don’t know what’s happening behind closed doors there.
Brian Sozzi (02:09):
Well, he can’t do anything at Twitter. I don’t think he could transform the platform if he has his investments at Tesla continuing to be under pressure. I mean, the stock is down before this 23% in December alone, 65% year to date. Anything that he wants to do at Twitter is going to be funded by his investments in Tesla, which have lost massive value.
Yes. Well, and he keeps saying he is not going to sell any more shares and then he keeps selling more shares because of what’s going on in Twitter as well. There is some analyst commentary by the way out today, even before that poll, it looks like this preceded that, that Oppenheimer is downgrading the stock to perform because of Twitter and because of the risks over at Twitter. A friend of the show, Colin Rush over there coming out and saying he’s increasingly isolated as the steward of Twitter’s finances with his user management on the platform. That is what he’s saying of Musk, and that there is a negative feedback loop from departures of Twitter advertisers and users due to inconsistent standards that results in these increased financing needs that may lead to incremental Tesla sales, just as there’s a more competitive environment right now for Tesla. In other words, the timing is not great for Elon Musk to be getting so enmeshed in Twitter.
Brian Sozzi (03:19):
Comes after Goldman last week too, cautious comments of volatism.
Brad Smith (03:21):
And there was also the report from DealBook that you pointed out earlier this morning, Julie, which pointed out or talked about Senator Elizabeth Warren and what she may be taking aim at most notably with regard to where Musk’s actions recently have been short-changing Tesla, and then additionally talking about the series of conflicts of interest with a misappropriation of resources from Tesla, of course the electric car maker that he also runs. But for misappropriation or even conflicts of interest in the past, that has been something that has followed Elon Musk around even since the acquisition that Tesla made of Solar City, an entity that he co-founded with his cousin.
So with all of that in mind, I think even as you get more of in D.C., more of the congressional kind of focus in on what’s taken place, the alignment of his time and his responsibilities because he still does have a fiduciary interest to shareholders over at Tesla too. And so that appropriation of time is a considerable effort for someone who has kind of painted themselves as not just the CEO and the CTO but also the chief marketing officer of Tesla. When you have that much power over a brand, that’s also something that investors recognize too.
Brian Sozzi (04:35):
Why can’t he employ something, or maybe he should be looking at something like Berkshire Hathaway where he appoints CEOs of all his different businesses and he just serves as an executive chairman. I know he is still a young guy. He likes to be in the trenches, but why wouldn’t something like that work here? It might. I don’t know if he’s thinking about that.
Because he doesn’t do anything other than what he wants to do. Is there any other model if you look? That would suggest that he …
Brian Sozzi (04:58):
Not that I’m seeing. I’ve never seen any, all this stuff.
Right, exactly. So who the hell knows? At the end of the day, that’s the bottom line when it comes to Elon Musk.