Snap's Ad Platform Troubles Sink Stock by 18% in Q2 2025

On August 6th, 2025, Snap Inc. (SNAP) saw its stock price plummet by more than 18% after the Snapchat parent company reported second quarter 2025 earnings and revenue that fell short of Wall Street's expectations. The primary driver behind the disappointing results was a problem with Snap's ad platform.

Snap's advertising revenue grew at its slowest pace in over a year, rising just 4% to $1.17 billion in Q2 2025, well below the $1.22 billion analysts had anticipated. The company attributed this to an issue with its auction system, which is used to price advertising campaigns for marketers on its platform. Snap said this caused campaigns to sell for "substantially reduced prices."

Beyond the ad platform troubles, Snap's adjusted earnings per share of $0 also fell short of the $0.02 expected, while its quarterly revenue of $1.34 billion missed the $1.35 billion projected by analysts. Though Snap's global daily active user count of 469 million exceeded the 468 million expected, its 98 million users in North America fell slightly short of the 99 million estimate.

Despite the Q2 2025 setback, Snap's outlook for the current quarter topped analysts' forecasts. The company expects Q3 2025 revenue to fall between $1.48 billion and $1.51 billion, compared to the $1.48 billion midpoint analysts had estimated. Snap also projects Q3 adjusted EBITDA of $117.5 million at the midpoint, more than the $116.1 million expected.