Shares of social media companies are heading for a loss of more than $100 billion in market value, after the company, “Snap”, the owner of the “Snapchat” application, warned about profits, adding to the problems of the sector, which is already reeling amid a halt in user growth and fears of raising interest rates.
Shares of “Snap”, which depends on digital ads, suffered a record drop in one day, with a loss of 30% during pre-market trading, and it will lose about 10 billion dollars in its market value if this trend continues.
Adding the value of the declines in its peers, including Facebook’s Meta Platforms and Google’s Alphabet, as well as Twitter and Pinterest, the group could see a combined loss of about $100 billion, according to Bloomberg. .
The company behind the social networking app Snapchat reported quarterly user growth in April that exceeded estimates, but with the company announcing just a month later that it would not meet previous expectations for revenue and profit, analysts noted a rapid deterioration in the economic environment.
Snap and platforms like Facebook and Google are competing for ad revenue at a difficult stage, as spiraling inflation is putting pressure on businesses and consumer spending, while recent privacy changes, such as Apple’s tracking restrictions, have slowed business. business that was booming during most of the pandemic.