Rumors have been flying that makeup mogul and reality star Kylie Jenner destroyed Snapchat’s stock value with a single tweet, but a closer look reveals that Jenner’s snappy 88 characters probably had less of an influence on the brand than you think.
After Jenner released a tweet on February 21st saying that she didn’t open the app anymore, Bloomberg published a story titled: “In one tweet, Kylie Jenner wiped out $1.3 billion of Snap’s market value.” The story noted that there was a seven percent decline in Snap Inc.’s stock price. But despite the extreme headline, there’s actually way more to the story.
Snapchat announced changes to its app earlier this month, which included a complete redesign of the friend’s page, how you send your snaps, find your friends on the app, and watch their stories. A recent Change.org petition has been circling to protest the redesign, and has been signed by millions of users.
And while Kylie did tweet that she isn’t a fan of the redesign, it was actually one of Citigroup’s financial analysts, Mark May, who downgraded Snap’s stock earlier in the week, citing overall negative reviews of Snap’s new design. Basically, Kylie’s connection to the app’s current situation has been overblown.
In actuality, Snap’s stock rose in early February after a strong earnings report but began trading down this past week. The stock was relatively neutral yesterday, February 22nd, and then began trading up by the end of the day. So Snap’s “dire” situation has also been relatively exaggerated.
However, the company released its annual report on Thursday, which cited that Snap faces many ongoing risks, including its reliance on Google’s Cloud infrastructure, its lack of a central headquarters, and ongoing competition from Facebook. But BTIG analyst Rich Greenfield noticed that Snap’s daily active users have increased.
So as of now, it looks like you’ll still be able to send cute snaps of yourself in unicorn filters to your pals. Phew.