Snap shares are written off after expected earnings release

Snap shares are down more than 30 percent in after-hours trading after the company told the SEC on Monday it expected to miss second-quarter earnings guidance.

“Since we published the guidelines on April 21, 2022, the macroeconomic environment has deteriorated increasingly faster than expected,” the company said in a presentation after the market closed. “As a result, we believe we are likely to report earnings and Adjusted EBITDA below the benchmark lower bound in Q2 2022.

In its first-quarter earnings, Snap, Snapchat’s parent company, hinted at disappointing revenue expectations as the company did not disclose a specific revenue target for the second quarter, as it normally does. Instead, Snap said it expects its revenue growth to grow by 20% to 25% a year. Looking at 2Q adjusted EBITDA, Snap predicted it would deteriorate to $50 million.

Responding to the company’s first-quarter earnings in April, Derek Anderson, Snap’s chief financial officer, warned that persistent supply chain delays, labor shortages, inflation and the ongoing war with Ukraine would negatively affect the company’s second quarter. .

Speaking at the JP Morgan Global Technology, Media and Communications Conference on Monday, Snap CEO Evan Spiegel said the company is “changing at a certain pace.” [Snap’s] “But this year will continue to be a ‘period of significant investment for the business’.

“Of course, we work with many other companies, which are affected by supply chain problems, inflation, interest rate concerns, the war in Ukraine, etc,” Spiegel said. “So today there is a lot of work in the macro environment, but we remain focused on the long term and on investment.”