Snap climbs 13% as Irenic suggests changes to boost stock’s value 7x

shares explode It 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 almost 600%.

“Snap shouldn’t keep doing what it’s doing. It’s not working,” Irenic wrote. savesnapnow.com as well as the presentation of recommendations.

The recommendations, titled “6 Steps to 7X,” aim to increase Snap’s stock price from $3.93 per share to over $26.

Irenic’s recommendations include shutting down or canceling the company’s augmented reality glasses unit, Specs. The unit was announced as a wholly owned subsidiary of Snap in January.

Referring to previous layoffs Uber, Meta And To obstructIrenic said Snap needed to use AI more intensively to lay off 1,000 employees, or 21% of its workforce.

“AI can and should replace many existing roles,” Irenic wrote under the company’s second recommendation, ‘rationalizing costs’.

According to the letter, Irenic Capital manages approximately $2.5 billion in assets and 2.5% of Snap’s Class A shares.

“Snap welcomes input from all shareholders and regularly communicates with investors on strategy, capital allocation and governance,” Snap chairman Michael Lynton said in a statement to CNBC. he said.

“We have taken steps to improve performance, strengthen free cash flow and offset water losses, and we will continue to evaluate actions that deliver long-term value for all shareholders,” he said.

Snap’s shares have lost nearly 83% of their value since it went public in 2017.

Last month, the company launched a creator subscription feature to help diversify its revenue.

Following Snap’s earnings release for the fourth quarter of fiscal 2025 last month, the company announced a $500 million share repurchase plan.