Snap Claims Slowest Sales Growth Ever
Zachary Kandell / 24 Oct 2022
Throughout the years, Snap, the company that created Snapchat, became more and more successful in its advertising operation. However, things turned opposite when Apple introduced its sweeping privacy adjustments that made it a true challenge to target new clients online.
Eventually, this steady trend resulted in hefty amounts in lost revenues for platforms such as Snapchat. Since then, the company’s business gravitated towards slowing down. As a matter of fact, Snap Inc. recently reported its slowest quarterly sales growth since going live in 2017. Upon spreading the news, the company’s shares plunged 28% in after-hours trade. Its shares are down nearly 80% year to date.
Aside from what Apple’s privacy changes did to its success, Snap also was forced to cope with turbulent macroeconomic headwinds, fierce competition, and such discouraging financial conditions such as spiraling inflation and the increasing cost of living. That, in its turn, made publishers even more unwilling to invest.
Although other companies have also gone through a lower demand for online promotion, Snap — which generated most of its revenue from ads — has been faced with a particularly challenging situation. That’s in many ways because when the going gets tough, publishers tend to stop working with less powerful players like Snap, rather than tech behemoths like Meta.
Snap is currently in the process of shrinking and readjusting its operation, following a major cut of its workforce and refusal from unfruitful projects. The team keeps laser-like focus on revenue-boosting efforts and works on growing its newly created subscription service, Snapchat+. So, what are your thoughts on all this? Do you use Snapchat often these days? Share your opinion in the comment box below. We value your feedback greatly.