Snap user trends not encouraging

Thrill and Brain noted that Snap’s position as a social-media platform depends on the need for users to have multiple friends who use it. That means if users turn to other platforms such as Instagram, it could cause “a negative flywheel” for Snap.

Snap’s negative user trends could also weigh on the company’s other strategies and advertisers’ interests, the analysts said.

Jefferies analysts said the recent exit of Snap’s two executives is “troubling” given that the company is still in the early stage of its business transition.

The social-media company said Monday that Imran Khan, its chief strategy officer, will be leaving the company, but will continue to serve in his current role to help with the transition. Company insiders told Business Insider they were not sorry to see Khan go, as “he had no ad or media background” and was not a “good fit in that strategy role.” 

The company’s first CFO Andrew Vollero also stepped down this year, with Tim Stone, a 20-year veteran executive from Amazon, sliding into the role. 

“We appreciate the recent increase in communication from new CFO Tim Stone (guidance was welcome) but question why senior leaders would leave amidst the business transition,” the analysts said, while trimming their price target to $11 from $14 and keeping their “hold” rating.