As per SQN Investors, the slow pace of innovation at Yelp has enabled its peers to narrow its lead. Further, in the last several quarters, Yelp’s performance was dismal with revenue expansion dipping below 2%.
SQN Investors LP, a hedge fund which has built a substantial holding in Yelp, has called for an overhaul of the company’s board and the appointment of new independent directors.
SQN Investors LP, which is part of the top 5 shareholders in Yelp, has blamed the company’s management for underperformance.
In a letter to the board, SQN Investors LP stated Yelp’s board has failed to hold itself and the management accountable for the company’s “repeated strategic and operational missteps.”
Hurt by lower-than-expected advertising sales, last month, Yelp reported that it missed its third-quarter revenue estimates and slashed its 2018 revenue forecast.
In 2018, Yelp’s shares have fallen by 18%.
“We are deeply concerned by the board’s lack of urgency in addressing many of the issues facing Yelp,” said SQN Investors LP while adding that a “refreshed” board will help determine if Yelp should consider selling itself.
In the last several quarters, Yelp’s performance was dismal with revenue expansion dipping below 2%.
According to SQN Investors, the slow pace of innovation has helped Yelp’s competitors, including Google and Facebook, to narrow its lead by collecting significant reviews.
Yelp stated, it is looking forward to a dialogue with SQN Investors.