Snap's stock drops sharply as revenue misses estimate

By Steve Gelsi

Investors brush off Snap's adjusted profit that beat analysts' expectations as they sour on the sector

Snap Inc.'s stock fell 16% on heavy volume in after-hours trading Thursday after the social-media company's second-quarter revenue fell slightly short of analysts' estimates and it said it could also miss third-quarter revenue projections.

The stock's big move into the red reflects continued negative sentiment towards tech stocks, as the Nasdaq fell 2.3% at the closing bell in a big sell-off during regular trading on Thursday.

Snap (SNAP) said its second-quarter loss was $248.6 million, or 15 cents a share, compared to a loss of $404.3 million, or 24 cents a share, in the year-ago quarter.

The parent company of Snapchat reported an adjusted profit of 2 cents a share, ahead of the FactSet consensus estimate for a loss of 15 cents a share.

Snap's second-quarter revenue rose 16% to $1.24 billion, just below analysts' estimate of $1.25 billion.

Snap's stock fell $2.14 to $10.72 a share in after-hours action on volume of more than 10 million shares. The stock price is now the lowest it's been since April.

Looking ahead, Snap expects third-quarter revenue of $1.34 billion to $1.38 billion, compared to analysts' estimate of $1.36 billion.

The estimate is based on 441 million daily average users in the third quarter, which is above the FactSet consensus estimate of 439.8 million.

Snapchat+ reached 11 million subscribers in the second quarter, the company said.

-Steve Gelsi

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08-01-24 2032ET

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