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Snap Second-Quarter Sales Fall Short on Advertising Glitch
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August 5, 2025
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5:15Now PlayingSnap Inc. reported second-quarter sales that were shy of Wall Street’s average estimates as the company, owner of the Snapchat photo-sharing app, dealt with a technical issue with its ad-buying tools that slowed revenue growth.
The company’s shares tumbled in late trading. Snap reported sales of $1.345 billion, slightly less than the $1.35 billion analysts were looking for. Revenue was crimped when the company inadvertently shipped an update to its advertising auction that allowed marketers to buy ads at “substantially reduced prices,” Snap said.
That issue has been fixed, according to a letter to shareholders Tuesday, and “advertising revenue growth has improved.” Snap’s sales in the current period will likely be higher than analysts projected. Revenue will be $1.48 billion to $1.51 billion, according to the statement Tuesday. Analysts on average had projected sales at the low end of that range.
Snap and Chief Executive Officer Evan Spiegel have spent years overhauling the company’s advertising technology in an effort to improve user targeting and drive direct sales. Those changes have helped Snap beat revenue expectations in six of the past eight quarters heading into Tuesday’s report.
In its investor letter, Snap highlighted its Sponsored Snaps advertising unit, which places paid messages that show up in a user’s messaging inbox just like those from their friends. Snap debuted the new ads last fall, and said they represent a “significant pool of inventory” as the company looks for new places for marketers to reach users inside the Snapchat app.
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