Shares of Snap Inc. plummeted nearly 13.8% on Wednesday following the announcement of the exit of its CFO, Tim Stone, after only eight months on the job. His exit follows the departure of Jason Halpert, the head of human resources.
This marks the exit of its second CFO in less than two years, since its IPO in March 2017.
With the exit of experienced industry personnel, several Wall Street analysts opined that this departure would be crucial for the company as the loss would make things tougher for the company to hire and retain top executives.
These are, however, not the only instances of executive departure. Over the past year, the company has witnessed the exit of several top-level executives as it faced a steady decline in users and tough competition from Facebook Inc.'s Instagram.
Losing more than 65% of its value since its IPO almost two years ago, the market value of Snap after the exit of CFO fell from $8.5 billion before the start trading to about $7.3 billion by the end of the day.
On Wednesday, RBC Capital Markets analysts have downgraded the stock from outperform to sector perform, while Summit Insights Group lowered its price target by 17% to $5.
According to analysts, Snap’s 28-year-old Chief Executive Evan Spiegel’s increasing centralized control could be driving the heavy turnover in the executive ranks.
The only positive news, in Tuesdays filing, was that the company expects its quarterly results would be slightly favorable to the upper end of its guidance.