- Snap shares fell 19% at the beginning of trading due to a weaker-than-expected forecast for the current period. The company's overall sales declined by 4% year-over-year, and it provided a lower-than-expected total sales forecast for the third quarter. Snap is considered a bellwether for digital marketing spend, and its recent struggles indicate the challenges faced by the industry.
- Since November 2021, Snap's shares have seen a significant decline from a share price of over $73. The company's growth in daily-active-users in North America has slowed down, and it had to undertake layoffs affecting over 1,000 employees, which accounts for 20% of its global workforce.
Why it matters
As a major player in the social media and tech space, Snap's performance is closely watched by investors and analysts as an indicator of broader trends in digital marketing spend. The decline in share value and sales highlights the company's struggles amid a modest recovery in the digital marketing sector.