Tech

Slack downplays report that sent stock soaring 15%, shares fall after hours

Key Points
  • Shares of Slack fell after hours after the company filed an 8-K Monday downplaying a news report that sent its stock surging more than 15%.
  • Earlier in the day, Business Insider reported that Slack had "just scored its biggest customer deal ever," saying IBM had recently decided to deploy its technology to all of its 350,000 employees.
  • Slack said in the filing, "IBM has been Slack's largest customer for several years and has expanded its usage of Slack over that time."
Slack Technologies Inc. CEO Stewart Butterfield stands on the trading floor during the company's IPO at the New York Stock Exchange (NYSE) in New York, U.S. June 20, 2019.
Brendan McDermid | Reuters

Slack filed an 8-K Monday downplaying a news report that sent its stock surging more than 15%.

Shares of Slack fell as much as 8% after hours following Slack's filing.

The stock was halted shortly before the end of the trading day, and the filing was released after hours. Earlier in the day, Business Insider reported that Slack had "just scored its biggest customer deal ever," saying IBM had recently decided to deploy its technology to all of its 350,000 employees.

In the filing, Slack said "IBM has been Slack's largest customer for several years and has expanded its usage of Slack over that time." The company added it would not update its financial guidance for the fourth quarter or its fiscal year ended January 31, 2020.

Business Insider reported that an IBM executive said more than 300,000 of its employees already had access to Slack and the company was working to onboard the last 50,000. The report said the expansion means "IBM is now Slack's single largest customer." Slack's filing confirmed IBM has long been its largest customer.

A Slack spokesperson later clarified that IBM's usage of Slack began in 2014 with a small team of 68 engineers. By 2019, when Slack introduced Enterprise Grid, the number had grown to 165,000, and the number currently stands around 300,000. Now, IBM has "scaled is Slack deployment so it can offer it to every employee" at the company.

WATCH: CNBC's full interview with Slack CEO Stewart Butterfield ahead of direct listing

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Watch CNBC's full interview with Slack CEO Stewart Butterfield