Tencent Now Owns More Than 10% of Snapchat Owner Snap
Thu Nov 09 2017
Rachel Long (496 articles)

Tencent Now Owns More Than 10% of Snapchat Owner Snap

China’s Tencent, which has long been a quiet investor in Snapchat owner Snap, now owns more than a tenth of the messaging firm.

When Snap announced its quarterly results on Tuesday—with lower-than-expected revenues slashing 16% off its stock price—its regulatory filing also revealed Tencent’s surprisingly large stake.

“Our long-term shareholder Tencent Holdings Limited… has notified us that it has recently acquired 145,778,246 shares of our non-voting Class A common stock via open market purchases,” the filing read. As noted in the Financial Times, that makes for a stake in excess of 10%.

Altaba, formerly known as Yahoo, said last month that it had offloaded 4.6 million of its shares in Snap.

As Snap’s new filing also pointed out, Tencent (tctzf) is also a competitor to Snap (snap). The Chinese firm is best known for its WeChat messaging app, although it has also build up a massive investment portfolio and is even building self-driving car technology. On Wednesday, Tencent’s e-book unit China Literature held an IPO that saw its shares quickly double in price.

Snap’s share price sank Tuesday because its quarterly revenues only amounted to $ 207.9 million, compared with the expected $ 236.9 million, and because it said it only had 178 million daily active users, versus the 181.8 million for which analysts were hoping.

The U.S. firm also posted a net loss off $ 443.2 million, writing down $ 39.9 million from its overhyped “Spectacles” foray into the world of consumer hardware.

Rachel Long

Rachel Long

Rachel Long is our Desk Correspondent covering Stock Markets across the globe. She is based in New York

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