Snap stock plunged Wednesday following its fourth-quarter earnings report that narrowly missed revenue estimates but beat on earnings. The report comes as the industrywide disruption in digital advertising continues to wreak havoc on social media companies.
Snap, the owner of video sharing platform Snapchat, reported adjusted earnings of 14 cents a share vs. estimates of 11 cents. Revenue of $1.3 billion fell a tad short of the $1.31 billion estimate.
Snap stock plunged 13.9% to 9.95, during morning trading on the stock market today. Snap reported earnings late Tuesday.
"It was a challenging year for our business as we continue to be impacted by macroeconomic headwinds, platform policy changes, and increased competition," said Snap Chief Executive Evan Spiegel, during the conference call with analysts.
SNAP Stock: Facing Significant Headwinds
In addition, he said, "We continue to face significant headwinds as we look to accelerate revenue growth, and we are making progress driving improved return on investment for advertisers and innovating to deepen the engagement of our community."
In a note to clients, Monness Crespi Hardt analyst Brian White wrote, "The competitive landscape remains fierce, and we believe the darkest days of this economic downturn are ahead of us. We remain on the sidelines with a neutral rating."
Also, Oppenheimer analyst Jason Helfstein maintained a rating of perform and a price target of $9.90 on SNAP stock in his note to clients.
"Snap continues to face the same headwinds: overreliance on brand advertising, reduced engagement on Friend Stories, and continued overhang from TikTok and Reelz," Helfstein wrote.
Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.
