Evan Spiegel, CEO of Snap Inc., speaks on stage at the Snap Partner Summit 2023 at Barker Hangar in Santa Monica, California on April 19, 2023.
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shares of snap Shares rose 13% on Tuesday after shareholder Irenic Capital Management sent a letter to CEO Evan Spiegel outlining changes that could increase the stock’s value by about 600%.
“Snap should not continue to do what it has been doing. It is not working,” Irenick wrote in a letter posted on savesnapnow.com along with the recommendation presentation.
The recommendation, titled “Six Steps to 7X,” aims to increase Snap’s stock price from $3.93 to more than $26 per share.
Irenic’s recommendations include closing or spinning off Specs, the company’s augmented reality glasses division. It was announced in January that the division would become a wholly owned subsidiary of Snap.
Referring to past layoffs, Uber, Meta and blockIrenick said Snap should use artificial intelligence more aggressively and eliminate 1,000 jobs, or 21% of its workforce.
Under the company’s second recommendation, “Cost Rationalization,” Irenick said, “AI can and should replace many existing roles.”
Irenic Capital manages about $2.5 billion in assets and owns about 2.5% of Snap’s Class A shares, according to the letter.
“Snap welcomes input from all shareholders and engages in regular dialogue with investors regarding strategy, capital allocation and governance,” Snap Chairman Michael Linton told CNBC in a statement.
“We have taken steps to improve our operating results, strengthen free cash flow and offset dilution, and we continue to evaluate our efforts to increase long-term value for all shareholders.”
Since going public in 2017, Snap’s stock price has fallen about 83%.
Last month, the company launched a subscription feature for creators in an effort to diversify its revenue.
During Snap’s fiscal 2025 fourth-quarter earnings call last month, the company announced a $500 million share buyback plan.
Snap stock since its IPO.
