Snap shares dropped 17% after reporting slower second quarter revenue growth, impacted by an error that caused advertising campaigns to clear the auction at lower prices. Daily active users increased by 9% to 469 million, with revenue rising 39% year-over-year to $1.34 billion. Advertising revenue grew 4% to $1.174 billion but was affected by the timing of Ramadan and global tariffs. Snap estimates Q3 revenue between $1.475 billion to $1.505 billion, while users and future product plans also indicate growth potential.
Unfortunately, in our efforts to improve advertiser performance, we shipped a change that caused some campaigns to clear the auction at substantially reduced prices.
Snap's delivered adjusted earnings before interest, taxes, depreciation and amortization (ebitda) of $41 million and $24 million of free cash flow.
Time spent on Spotlight grew 23% year-over-year in Q2 and now contributes more than 40% of total time spent watching content.
The company sees Q3 revenue in the range of $1.475 billion to $1.505 billion.
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