Snap restructures ad business amid worst sales growth rate in its history

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Snap Inc said on Wednesday revenue growth in the third quarter is running at the slowest rate in the company's history, as high inflation, rising interest rates and a deteriorating economy continues to ravage the advertising industry.As a result, the parent company of Snapchat said it will cut 20 per cent

Snap Inc said on Wednesday revenue growth in the third quarter is running at the slowest rate in the company's history, as high inflation, rising interest rates and a deteriorating economy continues to ravage the advertising industry.

Snap's warning in May that it would miss its revenue targets due to worsening economic conditions sparked a selloff of social media stocks. If that growth rate holds, it would be the slowest revenue growth Snap has had since becoming a public company in 2017 - a far cry from triple-digit growth rates it has recorded in previous quarters.

Gorman and Naylor's departures come after Snap reported a disappointing second quarter and is facing more competition from TikTok, she said.Despite reducing spending in some areas, Snap must now"face the consequences of our lower revenue growth and adapt to the market environment," CEO Spiegel wrote in the memo.

 

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