Snap Inc. shares rose more than 13% on Tuesday. Activist investor Irenic Capital Management sent a letter to CEO Evan Spiegel proposing a plan to increase the stock value sevenfold.
Irenic holds an economic interest of approximately 2.5% in Snap's Class A shares. The firm projects the stock could reach $26.37 per share.
The proposal calls for cutting approximately 1,000 jobs. Irenic also recommends shutting down or spinning off the Spectacles hardware division.
The firm urged Snap to improve advertising monetization using artificial intelligence. Additional recommendations include shifting to performance-based employee stock compensation and increasing share buybacks.