shares of snap It fell more than 13% on Wednesday, a day after the company released its third consecutive quarterly disappointing quarterly report.
In a letter to investors, Snap called it a “challenging year” marked by “macroeconomic headwinds, platform policy changes and increased competition.” slightly increased.
Like social media peers Meta and Twitter, Snap’s 2022 is a rough year as a slowing economy sees companies cut digital advertising budgets, while Apple’s iOS privacy update limits targeting capabilities. was.
UBS analyst Lloyd Walmsley downgraded Snap from buy to neutral. metaTikTok and YoutubeWalmsley reiterated its $10 price target, which represents a 13.5% decline from Tuesday’s close, lowering Snap’s 2023 earnings outlook.
“Given the amount of competition and the relatively small-scale nature of SNAP, we believe there is a risk to earnings acceleration,” he wrote in a note Wednesday.
Analysts at JP Morgan said that while Snap is affected by broader challenges in the industry and macroeconomic environment, it also faces company-specific challenges. Analysts say the company’s continued declining involvement in his Friend Stories will disrupt advertisers and revenue, even as it makes improvements to its ads.
“It is unclear how quickly Snap’s model will adapt to these changes, and it may take time for advertisers to recognize benefits and adjust bids and spend accordingly, especially at weaker macros. There is a nature.
environment,” they wrote in a note on Tuesday.
JP Morgan analysts maintained their underweight rating on the stock.
Analysts at Jeffries said Snap had a disappointing fourth quarter, cutting its 2023 forecast by 2%.
“We are concerned that the SNAP problem is exacerbating as recent ad platform changes have further boosted revenue growth and the depth of engagement in Friends Stories has again declined year-over-year. ‘, the analyst wrote in a note on Wednesday.
— CNBC’s Jonathan Bunyan and Michael Bloom contributed to this report.