Snap shares plummet almost 35% after the release of a lower-than-expected earnings report

Snap Inc.'s shares Snap Inc. (SNAP) dropped nearly 35% prior to the beginning of trading on Friday after disappointing results for the second quarter with its lowest-ever sales.

The social media firm was badly hit by a massive reduction in advertising spending as well as growing competition from rivals like TikTok to compete for the shrinking marketing budgets.

The company also stated that the privacy improvements made by Apple continue to impact their advertising businesses.

Snap's second-quarter revenue increased by 13 percent in the second quarter to $1.11 billion but fell short of analysts' estimates that were $1.14 billion.

Snap's active users per day grew to 347 million users in the period, compared to the estimates that were 344 million.

Due to the uncertainty in the economy, Snap failed to issue financial guidance for the 3rd quarter of the year.

Snap also stated that it will "substantially slow" its rate of hiring and the pace of operating expense growth.

In a statement, the business stated that "we are not satisfied with the results we are delivering, regardless of the current headwinds."

The Snap board also authorized the purchase of 500 million shares within the next twelve months.

and that it would divide the shares if they reached $40 within 10 years.

Snap shares have dropped around 65 percent so far this year.

There's no point in trying to promote your products when people are engaged in a tightening of belts.

Powell is preparing to slow the growth of the economy. Snap's sales slowdown shows an increase in consumer demand.