Snap Falls Apart

By Douglas A. McIntyre Published Feb 1, 10:30AM EST

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Snap Falls Apart — © Image Source / DigitalVision via Getty Images

Just when it appeared things could get no worse for social media company Snap Inc. (NYSE: SNAP | SNAP Price Prediction), they did. Snap said its revenue in the most recently reported quarter was flat from a year ago, which is more than a catastrophe for a social media company. Snap management said its internal forecasts were for revenue to fall 2% to 10% in the current quarter. And the end of Snap’s growth marks the day the company’s downward spiral becomes irreversible. (Click here for the American tech companies that laid off the most workers last year.)
[in-text-ad]
For the quarter just reported, revenue was flat at a little below $1.3 billion. Snap posted a loss of $288 million, compared to a profit of $23 million a year ago. CEO Evan Spiegel commented, “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.” Every bit of information in the release argues against that.
[nativounit]
Spiegel (and others) founded Snap in 2011. He remains chief executive and has stayed far too long. Snap competes with Facebook, Instagram and Twitter. It is rare that people use them all simultaneously. Plus, TikTok may have begun to drain market share as well.
[wallst_email_signup]
In September 2021, Snap traded at over $80 a share. It probably will be as low as $10. There is no reason for it to trade higher.
[recirclink id=1188369]
Snap finally has become a completely failed company. It does not have a product that will help it to recover. It relies on advertising, which is a choppy market, and advertising for social media is widely fragmented. Snap is near the bottom of the food chain.

Snap will stay in business, but that is about all it can say.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.