Snap Inc.’s signage. is displayed on a screen outside the Morgan Stanley building in New York.
Michael Nagle | Bloomberg | beautiful pictures
Social media and ad tech stocks fell in after-hours trading on Thursday after Snap Disappointing second quarter results and plans to slow down hiring.
According to Refinitiv, analysts had expected 18% sales growth in the third quarter, but the company said revenue so far for the period has been “approximately flat”.
Snap’s stock fell 26% after hours, and as investors awaited second-quarter results from companies that depend on similar online advertising, their shares rose as well.
Social media companies are among the hardest hit, like Facebook’s parent company Meta more than 5% off and Pinterest down nearly 7%, while Twitter fell 2%. Trading deskShares of Google fell nearly 7% and shares of Alphabet, Google’s parent company, fell 3%.
Snap attributed the disappointing results to slowing demand for its ad platform, increased competition from companies like TikTok and a challenging economy.
“Q2 2022 proves to be more challenging than we expected,” Snap said in its investment letter. The company added that it did not provide guidance for the third quarter because “future visibility remains extremely challenging.”
Overall, Snap’s stock has lost nearly two-thirds of its value by 2022.
“We are not satisfied with the results we are delivering,” the company said in the letter.
Twitter will report earnings on Friday morning, followed by Meta and Google next week. Analysts say they are expecting a decline in Meta’s revenue this quarter.
