As part of its restructuring initiatives, Snap Inc
The decision, as reported by CNBC, is intended to "increase decision-making speed and reduce overhead" at the company.
ReOrg: Back in August 2022, the company had announced its 2023 financial planning and reprioritization process. Accordingly, Snap committed to increasing focus on three strategic priorities: community growth, revenue growth, and augmented reality. This entailed reducing the size of Snap's workforce by 20%.
In September 2023, the company announced that it is shutting down its augmented reality (AR) division, as its competitive advantage in the space was being hurt by the emergence of AI tools. This would result in a loss of 170 jobs at the company. The report also hinted at the company closing its content team in the UK.
Q3 Earnings: At its Q3 conference call, CEO Evan Spiegel also made known that the company has increased its focus on improving its advertising platform to drive higher ROI for advertising partners, as part of the reorganization.
Snap reported in its earnings release that it experienced a decline in revenue due to "pauses in spending from a large number of primarily brand-oriented advertising campaigns" following the outbreak of the war in the Middle East.
The social-messaging app company reported a beat on third-quarter earnings on Oct. 24. Key highlights of the earnings report included announcements such as:
- A $500 million stock buyback program
- The retirement of the company's COO Jerry Hunter
- Snapchat's daily active users (DAUs) increasing by 12% year-over-year (YoY) in Q3 to 406 million
- Total time spent watching Spotlight increased >200% YoY
- Average revenue per user (ARPU) from the North American region remains under pressure
Price Action: Shares of SNAP stock are down 1.8% to $11.04 at the time of publication Friday.
