6 ms·

Spreadsheet warrior kinda shit. CFO needed 500M for a stock-buyback. CFO wrote down some napkin math, let go 1/5 of the team. Murdered all innovation into the g

by berz01 4y ago

Spreadsheet warrior kinda shit. CFO needed 500M for a stock-buyback. CFO wrote down some napkin math, let go 1/5 of the team. Murdered all innovation into the ground. Wallstreet loved it. Snapchat is a cashcow on a spreadsheet. CFO knows he needs another 20% layoff in Q1 of 2023 to drive his cost of capital down further. Expect more pain from the suits.

ginger2016 4y ago
Are they doing a buy back? Didn’t Steve Jobs say trading cash by buying back stock the worst idea ever?
- ssharp 4y ago
  For Snap? Probably. For Apple? Steve Jobs was never sitting on $100+ billion in cash. Though, Apple's buy backs + dividends made more sense given how profitable they were and how much cash they had on hand. Snap has never had positive operating income.
- advisedwang 4y ago
  https://techstory.in/snapchat-announces-a-new-500-million-share-buyback-plan/ https://techstory.in/snapchat-announces-a-new-500-million-sh... Both of these take a few months to plan, so from the timing of that story they must have been planning them simultaniously.
- htrp 4y ago
  Depends on when the options of the executive team were issued..... and whether a buyback gets them back into the money?
treis 4y ago
I think it's just really hard for a company to keep innovating like that. Once you get to a certain size about the best you can do is refinement on your existing product or muscle into adjacent products.
maerF0x0 4y ago
but the stock jumped 9% so wouldnt that be counter productive for buyback? (ie now you get less consolidation of ownership than before)
- robocat 4y ago
  They don’t need more ownership: “The result is that Spiegel and Murphy own a whopping 99.5% voting control of the company.” - https://www.marketwatch.com/story/as-snap-melts-down-its-founders-make-sure-to-protect-the-people-who-matter-themselves-11658452231 https://www.marketwatch.com/story/as-snap-melts-down-its-fou...
  - maerF0x0 4y ago
    my point is if the stock price jumps then the buyback occurs at a greater price per share, making the effect of the buyback less effective (fewer shares are eliminated)

by berz01 4y ago

ginger2016 4y ago

Are they doing a buy back? Didn’t Steve Jobs say trading cash by buying back stock the worst idea ever?

ssharp 4y ago
For Snap? Probably. For Apple? Steve Jobs was never sitting on $100+ billion in cash. Though, Apple's buy backs + dividends made more sense given how profitable they were and how much cash they had on hand. Snap has never had positive operating income.
advisedwang 4y ago
https://techstory.in/snapchat-announces-a-new-500-million-share-buyback-plan/ https://techstory.in/snapchat-announces-a-new-500-million-sh... Both of these take a few months to plan, so from the timing of that story they must have been planning them simultaniously.
htrp 4y ago
Depends on when the options of the executive team were issued..... and whether a buyback gets them back into the money?

treis 4y ago

I think it's just really hard for a company to keep innovating like that. Once you get to a certain size about the best you can do is refinement on your existing product or muscle into adjacent products.

maerF0x0 4y ago

but the stock jumped 9% so wouldnt that be counter productive for buyback? (ie now you get less consolidation of ownership than before)

robocat 4y ago
They don’t need more ownership: “The result is that Spiegel and Murphy own a whopping 99.5% voting control of the company.” - https://www.marketwatch.com/story/as-snap-melts-down-its-founders-make-sure-to-protect-the-people-who-matter-themselves-11658452231 https://www.marketwatch.com/story/as-snap-melts-down-its-fou...
- maerF0x0 4y ago
  my point is if the stock price jumps then the buyback occurs at a greater price per share, making the effect of the buyback less effective (fewer shares are eliminated)