Snap Cracks, a YouTube Exec Bounces

Snap! News today that Snap is laying off 20% of its workforce, and that two of its top ad executives are defecting to Netflix, represents a major setback for Evan Spiegel’s messaging app. After posting gangbusters growth last year in particular, it feels like Snap has slipped back into its dark days of 2018. Back then, Snap stock fell as low as $5 as its user growth slowed sharply. Some even began comparing Snap to Twitter, long considered social media’s laggard.

Snap stock today closed at $10, and fell slightly lower in after-hours trading, which means it has dropped 79% so far this year, making it one of the worst performers in the tech sector, Koyfin data shows. Until today, that stock sell-off seemed overdone: Snap’s 13% revenue growth in the second quarter, for instance, was healthier than Meta Platforms’ slight decrease. Yet Meta stock has fallen only 53% so far this year. But cutting a fifth of the workforce suggests Snap is experiencing a rougher third quarter than the company had expected. Even more worrisome, though, is the departure of Jeremi Gorman, Snap’s chief business officer, who along with Snap’s vice president of sales, Peter Naylor, is joining Netflix.