Square is dealing with fallout from its CFO’s upcoming departure, with shares in the company falling again on Thursday (October 12).
The day before, Square’s CEO Jack Dorsey revealed that Sarah Friar — often described as his right-hand person — was leaving the company to become the CEO of Nextdoor. That caused Square stocks to fall more than 8 percent, extending a 10 percent loss in regular trading.
That fall continued the following day as the company’s share price fell as much as 16 percent before closing the day down 11 percent at $69.03, according to the Financial Times.
Analysts noted that investor reaction showed the important role Friar has played at Square, where she served as the most visible person at the company other than Dorsey, who splits his time between the payments company and Twitter.
“Ms. Friar’s level of leadership has been an important aspect affording Mr Dorsey ample leeway to perform as a dual CEO, in our view. Simply, Ms. Friar was much more than a CFO to the company and in many respects a key architect in building Square’s business model,” said Citi analyst Peter Christiansen, who holds a “neutral” rating on the stock.
He added that Friar was “the single point of contact for investors. The downside is that Square has rarely featured other top leadership talent at the company. Whether it’s true or not, there is clearly a perception by many outside of the company, investors and press alike, that Ms. Friar essentially ran the company.”
Friar, who will stay at Square until December, helped see the company through its initial public Offering (IPO), as well as helped build its mobile services.
“Sarah isn’t just a world-class CFO. She’s a multidimensional leader who considered our entire business,” Dorsey said in an email to staff on Wednesday (Oct. 10). “Her team and role evolved through years of learning and building with us, and that’s not something you replace by simply hiring.”