Snap Inc (NYSE:SNAP) shares plunged in after-hours US trading as the social media giant missed a raft of Wall St forecasts and did not give guidance for its current quarter.
The Snapchat owner said: “The macroeconomic environment has deteriorated further and faster than anticipated”, as it revealed misses on revenues, earnings and daily active users while average revenue per user fell in its second quarter.
Revenues rose by 13% to US$1.11bn in the three months to June but this was below forecasts already revised down after a shock profit warning in May.
Losses, meanwhile, soared to US$422mln from US$152mln while cash burn rose 23% to US$124mln.
Snap was already in the doghouse after that May update, but this latest news knocked a further 25% off its market value, which is now around US27bn compared to US$130bn at its peak a year ago.
“Our financial results for Q2 do not reflect our ambition," CEO Evan Spiegel said alongside the results in an attempt to rally the share price.
Snap added it is to reassess its hiring, goals, and investments, which includes Spiegel’s remuneration who along with CTO Bobby Murphy will earn US$1 a year for the next four years with an incentive deal to get the share price back up to US$40.
Apple was also cited for many of its problems following the introduction by the iPhone maker of its new user tracking transparency tool, something that has hammered advertising.
“Platform policy changes have upended more than a decade of advertising industry standards,” Snap said.
A new subscription service, Snapchat Plus, has been launched to help restore some of the lost revenue, though Snap warned it will take some time before there is any meaningful improvement.
"As Meta found out earlier in the year, markets will severely punish richly valued tech stocks at the first sign of trouble, and there is now some risk to the broader equity markets from the FAANGS yet to report," said Jeffery Halley at Oanda.
Facebook owner Meta reports its latest numbers next week.