Slack’s Shares Plunge After It Predicts a Larger Loss
Summary
SAN FRANCISCO — The reality of being a public company is setting in for what were once some of Silicon Valley’s hottest start-ups. In its first earnings report since going public in June, Slack posted a bigger loss than a year ago and a 58 percent rise in revenue as its spending increased, owing partly to costs related to going public. The company, which makes business software, also projected that its losses for the current quarter would be wider than Wall Street expectations, sending its stock plunging more than 15 percent in after-hours trading. Stewart Butterfield, Slack’s chief executive, said in an interview that it would take time for the market to understand his company since it had created a new category of software, unlike soda or cars. Over time, he added, “people will develop a more mature understanding” of Slack.
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