Snap Inc. (SNAP) - Get Snap, Inc. Class A Report CFO Drew Vallero warned investors that the company's stock would take a "substantial" hit after the company reported dismal earnings on May 2, and he was right, as shares plummeted almost 24% last week.
This week, Vallero is stepping down as chief financial officer, which may show how seriously Snap is taking its problems.
Vallero is leaving the company after two years, according to documents filed with the Securities and Exchange Commission Monday. His last day as CFO will be May 15, and he will be replaced by Amazon.com Inc.'s (AMZN) - Get Amazon.com, Inc. Report vice president of finance Tim Stone on May 16.
Wedbush analyst Michael Pachter said that Stone is likely an upgrade given the roughly 20 years he spent at Amazon, as "they both hire well and get rid of people who are poor performers."
Snap has struggled to consistently grow users and revenue since going public in March 2017 and its share performance has reflected that.
Loup Ventures managing partner Gene Munster said it seemed that Vollero was the one being blamed by management for the stock's poor performance.
"Unfortunately for Vollero, Snap didn't perform well during his tenure," Munster said, adding that the social media app's struggle to compete with Facebook Inc.'s (FB) - Get Facebook, Inc. Class A Report platforms may be the true culprit, not Vollero.
"Facebook copying Snap features [and] Instagram Stories is to blame [for Snap's recent troubles]," Munster said.
However, the executive move could be a good sign that CEO Evan Spiegel and his team are taking investors' concerns to heart.
"The company needs to send a message to investors and employees that things need to change," Munster said.
Snap shares closed at $10.97 Tuesday, up 2.1% over the course of the day. Since the beginning of the year, the stock has dropped almost 25%.