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Why Slack Stock Gained Today

By Evan Niu, CFA – Oct 7, 2020 at 2:11PM

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The enterprise messaging platform is adding more remote work features.

What happened

Shares of Slack (WORK) were trading almost 5% higher as of 2 p.m. EDT Wednesday after the tech company unveiled new remote-work support features. The broader market is also rallying on hopes for an economic stimulus deal out of Washington.

So what

Slack is adding "asynchronous video" to its enterprise collaboration platform. Essentially, this will give users the option to make short-form videos that can be shared at a later time -- similar to the Stories format that has become popular on social media services. Slack says these videos will help people collaborate with more flexibility around timing without the "constant pressure of video conferences."

Slack app on Mac

Image source: Slack.

"Video conferencing is obviously not going away, but I think it's a legacy of the last 20 years of unified communications as a category," CEO Stewart Butterfield told The Verge. "I think over the next 20 years, especially given the stuff that happens with our mobile devices as consumers, I think we need room for more than just video conferencing as a means of people communicating using voice and video."

The tech company is also introducing "always-available" audio, which it hopes will encourage spontaneous interactions among colleagues. Slack is planning to allow  users from any organization to send direct messages to other users using a private link.

Now what

The numbers of new coronavirus cases are rising in many parts of the country, and periods of escalating concern about COVID-19 this year have tended to boost remote work and stay-at-home stocks. Slack has played an instrumental role in helping many companies maintain productivity during the pandemic, and competition for enterprise collaboration offerings has been intensifying.

President Trump has been sending mixed signals this week regarding his willingness to negotiate on another stimulus bill, but the market is hoping that the government will provide some form of economic relief soon.

Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Slack Technologies. The Motley Fool has a disclosure policy.

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