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Snap Continues to Restructure With Second Layoff in a Month
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Snap Inc. (SNAP - Free Report) reportedly announced its plans to terminate around 100 employees from its sales and advertising team within a month of downsizing the engineering team by almost 100 people. Notably, this is the third lay-off in 2018. The first one in January had cut down the size of the company’s content teams.
After posting better-than-expected results in the last quarter, Snap’s management is keen on getting the bottom line in the positive territory. In a recently filed 8-K, the company mentioned that it anticipates to save around “$25 million in 2018 and $34 million on an annualized basis” pertaining to the restructuring of the workforce.
Snapchat’s Initiatives to Improve the Top Line
A primarily young user base and stiff competition from well-established peers like Facebook are major headwinds for the company’s revenue growth. Nevertheless, the company has been adding noteworthy features to strengthen its user base.
Recently, a 3-D Friendmoji Deluxe World Lens feature was added on Snapchat. The tool will enable Snapchatters to superimpose a 3D version of not just themselves but also of their friends on their posts, bringing users close to the world of augmented reality (AR).
Reportedly, users on Apple’s (AAPL - Free Report) iOS and Alphabet’s (GOOGL - Free Report) Android devices having the Bitmoji app can avail this feature, which is built on the company’s Bitmoji Deluxe feature.
The company’s latest acquisition of PlayCanvas will help Snap to expand into AR/VR, providing developers with enhanced features, and thereby boosting its top line.
The company also announced the introduction of GIF — Graphic Interchange Format — stickers on its messaging application Snapchat by collaborating with Giphy. Snapchat also introduced a Tab feature on the Friends and Discover pages of the application that will enable users to easily sort Stories that they wish to see.
These initiatives along with the company’s streamlining strategies are expected to boost investors’ confidence and help shares rebound, which have underperformed the industry over the past year. While the industry gained 33.1%, Snap lost 29% in the same time frame.
Concerns Prevail
Notably, the company’s recent redesign has not gone down well with users and is a headwind for the business. An online petition with more than a million signatures was filed in order to get users back to the old application.
Additionally, the recent criticism of the application by singer Rihanna for running an ad (involving her and ex-boyfriend Chris Brown) on the platform that promotes domestic violence affected its share price movement as well. Moreover, Rihanna used her Instagram account, which is Snap’s archrival.
To Conclude
Snap has been facing issues of late. However, we are optimistic about this Zacks Rank #3 (Hold) stock’s strategic initiatives. These are expected to help it survive amid a highly competitive social media industry including the likes of prominent players like Facebook and Twitter.
Earlier this year, credit bureau Equifax announced a massive data breach affecting 2 out of every 3 Americans. The cybersecurity industry is expanding quickly in response to this and similar events. But some stocks are better investments than others.
Zacks has just released Cybersecurity! An Investor’s Guide to help Zacks.com readers make the most of the $170 billion per year investment opportunity created by hackers and other threats. It reveals 4 stocks worth looking into right away.
Image: Bigstock
Snap Continues to Restructure With Second Layoff in a Month
Snap Inc. (SNAP - Free Report) reportedly announced its plans to terminate around 100 employees from its sales and advertising team within a month of downsizing the engineering team by almost 100 people. Notably, this is the third lay-off in 2018. The first one in January had cut down the size of the company’s content teams.
After posting better-than-expected results in the last quarter, Snap’s management is keen on getting the bottom line in the positive territory. In a recently filed 8-K, the company mentioned that it anticipates to save around “$25 million in 2018 and $34 million on an annualized basis” pertaining to the restructuring of the workforce.
Snapchat’s Initiatives to Improve the Top Line
A primarily young user base and stiff competition from well-established peers like Facebook are major headwinds for the company’s revenue growth. Nevertheless, the company has been adding noteworthy features to strengthen its user base.
Recently, a 3-D Friendmoji Deluxe World Lens feature was added on Snapchat. The tool will enable Snapchatters to superimpose a 3D version of not just themselves but also of their friends on their posts, bringing users close to the world of augmented reality (AR).
Reportedly, users on Apple’s (AAPL - Free Report) iOS and Alphabet’s (GOOGL - Free Report) Android devices having the Bitmoji app can avail this feature, which is built on the company’s Bitmoji Deluxe feature.
The company’s latest acquisition of PlayCanvas will help Snap to expand into AR/VR, providing developers with enhanced features, and thereby boosting its top line.
The company also announced the introduction of GIF — Graphic Interchange Format — stickers on its messaging application Snapchat by collaborating with Giphy. Snapchat also introduced a Tab feature on the Friends and Discover pages of the application that will enable users to easily sort Stories that they wish to see.
These initiatives along with the company’s streamlining strategies are expected to boost investors’ confidence and help shares rebound, which have underperformed the industry over the past year. While the industry gained 33.1%, Snap lost 29% in the same time frame.
Concerns Prevail
Notably, the company’s recent redesign has not gone down well with users and is a headwind for the business. An online petition with more than a million signatures was filed in order to get users back to the old application.
Additionally, the recent criticism of the application by singer Rihanna for running an ad (involving her and ex-boyfriend Chris Brown) on the platform that promotes domestic violence affected its share price movement as well. Moreover, Rihanna used her Instagram account, which is Snap’s archrival.
To Conclude
Snap has been facing issues of late. However, we are optimistic about this Zacks Rank #3 (Hold) stock’s strategic initiatives. These are expected to help it survive amid a highly competitive social media industry including the likes of prominent players like Facebook and Twitter.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Can Hackers Put Money INTO Your Portfolio?
Earlier this year, credit bureau Equifax announced a massive data breach affecting 2 out of every 3 Americans. The cybersecurity industry is expanding quickly in response to this and similar events. But some stocks are better investments than others.
Zacks has just released Cybersecurity! An Investor’s Guide to help Zacks.com readers make the most of the $170 billion per year investment opportunity created by hackers and other threats. It reveals 4 stocks worth looking into right away.
Download the new report now>>