NEW YORK, Jan. 16, 2019 /PRNewswire/ -- Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com) is investigating claims on behalf of investors in Snap, Inc. ("Snap" or the "Company") (NYSE: SNAP). Investors who purchased Snap common stock between March 2, 2017 and August 10, 2017, inclusive (the "Class Period") may be affected.
A securities class action is pending in the United States District Court for the Central District of California (the "Action"). The Action arises out of Snap's March 2, 2017 Initial Public Offering ("IPO"). According to the complaint, the IPO raised $3.4 billion from public investors by selling 200 million shares of Snap at $17 per share. Further, as alleged in the Action, Snap's IPO was a race to capitalize on the market's misconception that Snap was a viable and growing company before the truth about the actual threat Instagram posed became known and the only winners were the insiders who sold tens of millions of shares to unsuspecting investors and the underwriters who reaped immense fees.
According to the complaint, before the IPO Snap's management knew that Snap's principal competitor Facebook had successfully mimicked Snapchat's most popular features through Instagram and, by the time of the IPO, had eclipsed Snap's Daily Active Users ("DAU"), the principal metric that Snap represented was fundamental to its valuation.
The truth was revealed through a series of disclosures starting on May 10, 2017 when Snap reported its quarterly results for the first quarter of 2017, disclosing only modest growth in the key performance metric, DAU, which it had touted as being vital to its success in its Registration statement for the IPO. Snap's DAUs increased only 5% quarter-over quarter. In response to the news of Snap's disappointing user growth, Snap's share price declined $4.93 per share, or approximately 21%, from a closing price of $22.98 on May 10, 2017 to close at $18.05 per share on May 11, 2018.
On August 10, 2017, after the market closed, Snap reported its financial results for the second quarter of 2017, which included DAU growth of only 4% quarter-over-quarter. In response to Snap's continued disappointing growth in user engagement, Snap's share price declined $1.94 per share, or approximately 14%, from a closing price of $13.77 on August 10, 2017, to close at $11.83 per share on August 11, 2017.
If you are a member of the proposed Class, you may move the court no later than January 31, 2019 to serve as a lead plaintiff for the purported class. You need not seek to become a lead plaintiff in order to share in any possible recovery. If you would like to discuss the complaint or our investigation, please contact us by emailing email@example.com or by calling 800-290-1952.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
Kaplan Fox & Kilsheimer LLP, with offices in New York, San Francisco, Los Angeles, Chicago and New Jersey, has many years of experience in prosecuting investor class actions. For more information about Kaplan Fox & Kilsheimer LLP, you may visit our website at www.kaplanfox.com. If you have any questions about this Notice, the action, your rights, or your interests, please contact:
Jeffrey P. Campisi
KAPLAN FOX & KILSHEIMER LLP
850 Third Avenue, 14th Floor
New York, New York 10022
Fax: (212) 687-7714
Laurence D. King
KAPLAN FOX & KILSHEIMER LLP
350 Sansome Street, Suite 400
San Francisco, California 94104
Fax: (415) 772-4707
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SOURCE Kaplan Fox & Kilsheimer LLP