SNAP Stock Rebounds Overnight: CEO Defends Premium Specs Against META's Cheaper Glasses, But Analyst Sees A Tough Sell

CEO Evan Spiegel took a jab at Meta, saying "those copycats up north" won't be able to replicate Specs, citing Snap's portfolio of over 7,000 patents.

• SNAP stock slumped 10% on Tuesday after the company unveiled its $2,195 Specs AR headset.
• Spiegel argued that Specs belong in a "totally new category of computing," differentiating them from Meta's (META) cheaper smart glasses.
• The $2,195 device includes AR displays, AI assistance, navigation, gaming features, hand tracking, and support for hundreds of Lens experiences.

Shares of Snap, Inc. (SNAP) jumped over 1% overnight late Tuesday after CEO Evan Spiegel defended the company's $2,195 Specs headset against Meta's (META) cheaper smart glasses, though Stifel warned that the premium price could limit adoption.

SNAP stock slumped 10% on Tuesday, logging its worst session in nearly three months. 

SNAP Takes Aim At META's Smart Glasses

The augmented reality glasses, unveiled Tuesday at the Augmented World Expo (AWE) in California, represent Snap's most ambitious hardware push yet as the company looks to build a business beyond social media and position itself in the race for the next computing platform.

Spiegel pushed back on comparisons between Specs and Meta's smart glasses, arguing that the products serve different purposes. "Today, if you look at the market, it's bifurcated," Spiegel told CNBC, adding that consumers currently choose between lightweight smart glasses that "aren't really capable of much" and bulky virtual reality headsets that are "clunky and hard to wear." The CEO said, "Specs occupy a totally new category of computing."

The comments come after Spiegel took a swipe at Meta during his keynote presentation: "Those copycats up north aren't going to be stealing this one. We've filed more than 7,000 patents." Meta's smart glasses start around $250, while display-equipped versions begin at $799.

Meanwhile, Specs’ hefty $2,195 price tag immediately drew attention. "The most important way to think about Specs is as a computer. They're comparably priced to other high-end computers or high-end laptops," Spiegel said. The device includes transparent AR displays, AI-powered assistance, navigation, notifications, gaming experiences, hand tracking and support for hundreds of augmented reality applications. 

Snap is targeting early adopters, developers and enterprise users with the first generation of Specs. The company said that over 450,000 developers already use its AR tools and that hundreds of Lens experiences will be available at launch. "The reason why we have a first-mover advantage today with Specs is because we've been investing in augmented reality and our developer tools for such a long time."

Analyst Questions SNAP Specs' Demand

Stifel maintained its ‘Hold’ rating after Snap's AWE presentation, pointing to the company's growing augmented reality developer network and its latest push into hardware with SPECS. While the firm viewed the launch as progress in broadening Snap's business beyond Snapchat, it said the headset's high price could limit near-term adoption. As a result, Stifel does not expect the product to materially improve revenue growth in the near future and continues to take a cautious view on the stock. 

How Do Retail Traders Feel About SNAP?

On Stocktwits, retail sentiment for SNAP jumped to ‘extremely bullish’ from ‘bullish’ levels a day ago amid an 874% surge in 24-hour message volumes.

One bullish user said, “so what does everyone predict sales will be for the first year of the glasses…u have 1billion users and if only 0.1% buy the glasses that’s 1million x 2200 = 2.2billion in revenue….thats easily doable”

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Meanwhile, a separate bearish user said, “how does the CEO think that a pair of $2200 glasses was a good idea unbelievable. No wonder this stock is $5.”

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SNAP stock has declined 38% over the past year. 

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