Categories LATEST, Technology, U.S. Markets News

Snap CEO pares equity holding by 1% in first-ever stock sale

It is a common practice among company CEOs to divest their personal shareholdings, while also ensuring that the sale is timed strategically so as to keep a tab on insider trading.

That’s exactly what Evan Spiegel, CEO of social media company Snap Inc., did last week. Nearly a year after Snap went public, Spiegel sold 2.68 million shares of the company, which accounts for just above 1% of his total shareholding. The transaction, which was performed as per a pre-arranged sales plan, fetched him $18.71 per share.

CEO Evan Spiegel (Courtesy: Snap Inc)

What makes the 50-million dollar transaction special is the fact that it is the first ever stock sale by Spiegel, who had vowed not to sell shares in the first year after the IPO.

The sale does not materially change the 88% control he enjoys in the company and the Snapchat app, along with co-founder Bobby Murphy. In the New York Stock Exchange, Snap’s stock lost around 5% in pre-market on Tuesday, reversing some of its recent gains.

The transaction fetched Spiegel $18.71 per share

The company’s better-than-expected fourth quarter results had triggered a stock rally at the beginning of the month. A marked growth in user base helped it reduce operating loss in the December quarter, compared to the preceding quarter.

The other highlights of the quarter were the acquisition of ad tech startup Metamarkets and launch of the ‘hands-on augmented reality’ ads that allows users to interact with the products of a particular brand.
Recently, the company had subjected the Snapchat app to an extensive revamp, giving rise to a controversy over the aesthetics of the new design. A more precise picture of users’ response to the allegedly botched redesign is expected to emerge soon, as the app is currently being launched in other regions outside the US.  Defending the new look of the app, Spiegel at a meeting said the changes were long overdue.

Meanwhile, market watchers are upbeat about Snap’s outlook, with the main positives being the effective measures adopted by the company to retain user base and to mobilize advertisement revenue.

Most Popular

United Parcel Service (UPS) seems on track to regain lost strength

Cargo giant United Parcel Service, Inc. (NYSE: UPS) ended fiscal 2023 on a weak note, reporting lower revenues and profit for the fourth quarter. The company experienced a slowdown post-pandemic

IPO Alert: What to look for when Boundless Bio goes public

Boundless Bio is preparing to debut on the Nasdaq stock market this week, and become the latest addition to the list of biotech firms that have launched IPOs this year.

Nike (NKE) bets on innovation and partnerships to return to high growth

Sneaker giant Nike, Inc. (NYSE: NKE) has been going through a rough patch for some time, with sales coming under pressure from weak demand and rising competition. Post-pandemic, the company

Tags

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top