Shares of Snap (NYSE:SNAP) are tanking today, down by 12% as of 11 a.m. EST, after the Snapchat operator disclosed that its CFO is leaving the company. Snap poached finance veteran Tim Stone from e-commerce giant Amazon.com last May.
In a regulatory filing, Snap said it was still in the process of finalizing its fourth-quarter earnings results, and expects revenue and adjusted EBITDA to come in at the high end of its guidance. More importantly, the company said Stone notified Snap yesterday that he plans to resign in order to "pursue other opportunities." Stone is not leaving due to any disagreement around "accounting, strategy, management, operations, policies, regulatory matters, or practices (financial or otherwise)," according to the filing.
That is a fairly customary statement most companies include in such announcements, hoping to dispel any investor fears.
Despite Snap's efforts to reassure investors, having a CFO resign after just eight months on the job is never a good look. Stone was largely credited for Snap starting to provide financial guidance, which was a clear win for investors. Having no visibility from management on financial forecasts in addition to no votes in how the company is run was a terrible combination, and offering an outlook helps set expectations for both analysts and investors.
User metrics continue to deteriorate, costs are mounting, and negative reports have surfaced in recent months regarding CEO Evan Spiegel's leadership style. Snap is struggling to put together a turnaround, and losing its second CFO in less than a year casts doubt on its ability to do so.
Check out the latest Snap earnings call transcript.