- Snaps user trends are declining around the world during the third quarter.
- This negative trending could weigh on the company’s other strategies and advertiser’s ability to scale their campaigns, says Jefferies.
- Watch Snap trade in real time here.
Snap user trends are tumbling in the third quarter, capping the company’s efforts to improve the Android experience and advertiser’s ability to scale their campaigns, according to Jefferies.
Snap’s negative user trends could also weigh on the company’s other strategies and advertisers’ interests, the analysts said.
They also questioned “how long advertisers will stick around if users are not” as Snap’s sponsors could be limited in the ability to scale their ad campaigns if users and time spent continue to decline.
The social-media company said Monday that Imran Khan, its chief strategy officer, will be leaving the company, but will continue to serve in his current role to help with the transition. Company insiders told Business Insider they were not sorry to see Khan go, as “he had no ad or media background” and was not a “good fit in that strategy role.”
The company’s first CFO Andrew Vollero also stepped down this year, with Tim Stone, a 20-year veteran executive from Amazon, sliding into the role.
“We appreciate the recent increase in communication from new CFO Tim Stone (guidance was welcome) but question why senior leaders would leave amidst the business transition,” the analysts said, while trimming their price target to $US11 from $US14 and keeping their “hold” rating.
Snap shares have been under pressure since last month, when the company reported quarterly results that beat on the top and bottom lines but said its number of daily active users fell 2% to 188 million, missing Wall Street estimate of 193 million.
Also on Wednesday, BTIG analyst Rich Greenfield issued a “sell” rating on Snap and dropped his price target to $US5, according to Bloomberg.
Snap shares are down 37% this year through Tuesday.
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