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Data Sheet—Why Snap's Stock Price Snapped Back

Snap, Snapchat's parent company, shares trade on the floor of the New York Stock Exchange (NYSE) on Friday, Sept. 1, 2017. Photograph by Michael Nagle—Bloomberg via Getty Images

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When Snap blew its first quarter as a public company last May and its stock cratered, my reaction was that it was “by no means game over” for the young company. Snap was arrogant, untested, and faddish. And its founders controlled the company. None of this was news. Its anemic user growth was, however, and investors punished the stock, sending it to its IPO levels of about $17 a share.

Wednesday Snap’s shares jumped nearly 50% because suddenly things are moving in the right direction. It is adding users. Revenues are growing impressively. It is tending to Android users, a category that was weirdly lagging a year ago. And Snap’s traction may be the first tangible sign outside of Facebook’s own results that advertiser disgust with the “meaningful social interaction” company is having a meaningful impact.

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The good and the bad for Snap is that it’s still tiny, accounting for perhaps 1% of a market dominated by Facebook and Google. That means opportunity but also an uphill climb.

The lesson to remember here is that investors are fickle and unemotional. They’ll whine about anything and everything, like “unfair” dual-class ownership structures. And the minute the narrative improves, their ire turns to love.

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Briefly … I love how Daisuke Wakabayashi of The New York Times is providing a running commentary on the way Travis Kalanick speaks in his testimony at the Waymo-Uber trial in San Francisco. Tuesday he focused on Kalanick’s use of the expression “jam sesh,” for jam session, or a time for entrepreneurs (not musicians) to sit around brainstorming on business ideas (not playing music). Wednesday Wakabayashi quoted Kalanick saying Google became “unpumped” with Uber as it invested in self-driving cars. Only Kalanick speaks this way, and kudos to Wakabayashi for recording it. … Recommended reading: The New Yorker details the dangerously unprepared way the son-in-law of the President of the United States has been conducting foreign policy. Of note, the print version of the article said Jack Ma had invested in Cadre, a company Jared Kushner co-founded. An online correction said David Yu, co-founder of a private-equity firm with Ma, invested in the company. The firm in question in Yufeng Capital, based in Shanghai, and unless Yu invested in Cadre personally the distinction is a curious one, as is the correction.

NEWSWORTHY

Many of you clicked to read yesterday’s story about the upcoming Han Solo movie, so without further adieu:

Luke, we’re gonna have company. Nest, the smart thermostat startup Google bought for $3.2 billion in 2014, is losing its status as a separate unit within the company and will be absorbed by Google’s hardware team under Rick Osterloh. Nest was co-founded by former Apple executive Tony Fadell, who left Google in 2016. Google also said it paid $2.9 million as rewards to people who found security vulnerabilities in the company’s products and services in 2017, about the same amount as the prior year.

Women always figure out the truth. Always. Men who drive for Uber earn 7% more than women drivers, according to a study by the University of Chicago and Stanford University with Uber’s help. “Even in the gender-blind, transactional, flexible environment of the gig economy, gender-based preferences (especially the value of time not spent at paid work and, for drivers, preferences for driving speed) can open gender earnings gaps,” the study concluded.

You like me because I’m a scoundrel. On Wall Street, Twitter was the latest sad sack tech stock to impress with fourth quarter earnings. A day after Snap’s stock gained almost 50%, as Adam mentioned, Twitter shares jumped 22% in premarket trading after the company reported its first real profit ($91 million) and a surprise gain in revenue, though it was only 2%, to $732 million.

You know, sometimes I amaze even myself. In its first integration with Whole Foods, Amazon will deliver groceries from the supermarket chain under its Prime Now service starting in four cities: Austin, Dallas, Virginia Beach, and Cincinnati. “You’re going to continue to see us doing lots of things together,” Amazon vice president Stephenie Landry tells the Wall Street Journal.

I see a big bright blur. Hackers could gain control of smart TVs from Samsung, TCL, and others to play offensive videos, install unwanted apps, or suddenly scroll through channels, Consumer Reports warned. “It might feel creepy, as though an intruder were lurking nearby or spying on you through the set,” the testing group wrote.

Don’t everyone thank me at once. Intel released corrected software updates to combat the Meltdown and Spectre security attacks on its Skylake series of chips. A prior set of patches had bugs that caused PCs to freeze up and crash. People using Intel’s Broadwell, Haswell, Kaby Lake, Skylake X, Skylake SP, and Coffee Lake lines of chips are still waiting, Betanews reported.

I’m in it for the money. Didi Chuxing agreed to work with 12 automakers—including Kia Motors, Geely Auto, and Renault-Nissan-Mitsubishi—to build an electric car sharing network in China.

FOOD FOR THOUGHT

John Perry Barlow, who wrote songs for the Grateful Dead and became one of the earliest advocates for free expression on the web, died on Wednesday. The announcement was made by the Electronic Frontier Foundation, the thriving cyber civil right advocacy group he helped found. More than 20 years ago–wait, how can that possibly be?–Barlow published a “Declaration of the Independence of Cyberspace,” laying out how he thought the then-new medium should be regulated, or not.

These increasingly hostile and colonial measures place us in the same position as those previous lovers of freedom and self-determination who had to reject the authorities of distant, uninformed powers. We must declare our virtual selves immune to your sovereignty, even as we continue to consent to your rule over our bodies. We will spread ourselves across the Planet so that no one can arrest our thoughts.

We will create a civilization of the Mind in Cyberspace. May it be more humane and fair than the world your governments have made before.

IN CASE YOU MISSED IT

These Charts Show How Security Pros Are Rising in the Corporate Ranks By Robert Hackett

Redheads Will Finally Get Emojis This Year By Jamie Ducharme

Why Walmart Wants to Sell More Stuff for $10 and Up By David Meyer

Winklevoss Twins Say Bitcoin Will Hit $320,000 and Non-Believers Suffer a ‘Failure of Imagination’ By David Meyer

Elon Musk’s Tesla Missed Mars Orbit After Successful Falcon Heavy Launch By Don Reisinger

Watch Out, Sony and Microsoft: Google Is Developing a Video Game Streaming Service By Chris Morris

No, Facebook Isn’t Limiting Your News Feed Updates to 26 Friends By Don Reisinger

BEFORE YOU GO

The digital nomad lifestyle is getting an upgrade. A company called Roam is creating a network of work-live spaces in interesting cities around the world (Miami, Tokyo, London, and Ubud, in Bali, so far) aimed at people who are able to do their work and live anywhere. Intrigued? The New York Times has a profile.

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