Twitter expected to name Jack Dorsey as permanent CEO

Twitter's (TWTR) board of directors plans to name Jack Dorsey the company's permanent CEO without requiring the him to step down from his post as CEO of payments startup Square, the web site Recode reported on Wednesday.

Dorsey, who helped found Twitter before moving to Square, was named interim CEO in June after then-top exec Dick Costolo announced his surprise resignation. The official word on Dorsey could come as early as Thursday, Recode reported, citing unnamed sources.

Shares of Twitter, which have been trading around the company's initial public offering price of $26 a share for the past two months, initially jumped 4% on the news to a high of $27.33. But the bump was short-lived and shares fell to $26.23 in later afternoon trading, the same level as before the Recode report.

Twitter declined to comment.

Investors soured on Costolo's approach as Twitter's user growth stalled even as its revenue increased dramatically. Sales more than doubled to $1.4 billion last year from 2013, as Costolo found more ways to add advertising to the short messaging service. But the number of monthly active users increased only 20% to 288 million.

The move to hire Dorsey while he stays on at Square appears at odds with statements from the Twitter board earlier in the search process. As Dorsey's name rose to the top of the rumored candidates list, the company issued a press release on June 22 saying it would consider only "who are in a position to make a full-time commitment to Twitter."

Dorsey has said he wants to speed up the development of new products and improve how Twitter is experienced by new users. The lack of faster user growth "is unacceptable and we’re not happy about it," Dorsey said on the company's quarterly call with analysts in July.