Snap experienced a significant decline in stock value, dropping over 18% after reporting second quarter earnings. Advertising revenue grew at its slowest rate in over a year, reaching $1.17 billion, below Wall Street's expectations of $1.22 billion. An issue with its auction system reduced campaign prices. Adjusted earnings per share were $0, missing the expected $0.02, while quarterly revenue was $1.34 billion versus an expected $1.35 billion. Although user engagement was slightly above projections, North American user numbers fell short, and analysts expressed ongoing concerns regarding Snap's ad growth potential.
Snap reported second quarter earnings and revenue that missed Wall Street's estimates, with advertising revenue growth slowing to roughly 4% and adjusted earnings per share of $0.
An issue with Snap's auction system led to campaigns selling for substantially reduced prices, affecting overall revenue and results.
Despite having 469 million global daily active users, the company's 98 million users in North America slightly missed analysts' expectations for the second quarter.
RBC Capital Markets indicated that Snap's execution on ad platform development did not meet expectations, reinforcing concerns about its growth potential in the advertising sector.
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