Ad Spending Among ‘First Areas Impacted’ by Inflation: Snap CFO
Snap’s Q2 revenue grew 13% year over year to $1.11 billion, substantially lower than the 50% compound annual growth rate in revenue since it became a public company in 2018, said Snap's investor letter Thursday. The disclosure sent the stock…
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plunging 39.2% Friday to close at $9.96. Snap has been fending off “macroeconomic challenges” since late in 2021's Q4, said Chief Financial Officer Derek Andersen on an earnings call Thursday. “While there have been lingering supply chain and labor supply issues impacting certain segments that began during the pandemic, more recently, we've seen the impact of persistently high inflation, then rising interest rates and rising geopolitical risks associated with the war in Ukraine,” said Andersen. The various headwinds are putting pressure “on the earnings of a wide variety of companies, and this is directly impacting the demand for advertising,” he said. As many industries and verticals have come under “top line or input cost pressure,” ad spending has been among “the first areas impacted,” he said.