Stock market slump follows six consecutive increases after Snap discloses insider trades
In the ever-evolving world of tech, Snap Inc. finds itself under scrutiny, with the U.S. Federal Trade Commission (FTC) launching an inquiry into the company. According to reports, the FTC is investigating seven companies, including Snap, over potential negative impacts of AI chatbots on children and teens.
The FTC's inquiry comes at a time when Snap is grappling with a decline in market share and lack of profits. Despite this, the stock price of SNAP closed at $8.44 on September 18, marking a 5.63% increase. However, the following day saw a 3.32% decrease, with the stock closing at $8.16 on September 19.
The stock market volatility is further compounded by insider sell transactions. Yesterday, four insider sell transactions were recorded at Snap, post market close. Notable among these were CFO Derek Andersen, who sold 33,871 class A shares at a weighted average price per share of $7.56, and Chief Accounting Officer Rebecca Morrow, who sold class A shares worth $18.90K. Additionally, Ajit Mohan, the Chief Business Officer, sold shares worth $208.54K, and Mohan Ajit, the director, sold 27,595 Class A shares on September 16, 2025.
Despite the challenges, the stock still holds the attention of investors. Sell-side analysts and the Quant Rating system view SNAP as a Hold, while Seeking Alpha authors recommend buying SNAP stock. The stock gained 3.40% on the day of the FTC probe announcement.
It's worth noting that over the last six trading days, Snap added 18.33% to its stock value. However, year-to-date, SNAP has lost approximately 24% of its stock value.
The inquiry into Snap is part of a broader investigation into AI chatbot safety for kids, with companies like Alphabet and OpenAI also facing scrutiny. Meanwhile, the tech world continues to move forward, with news of Ant's new robot and Figure IPO adding to the industry's buzz.
As the FTC inquiry unfolds, it remains to be seen how this will impact Snap's future. However, one thing is clear: Snap won't stay cheap for long in the eyes of investors.
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