Snapchat shares tumbled by 25% on Thursday after noticing the weakening economy on social media and had suddenly planned to slow down their hiring process as it reckons with weakening revenue growth.

HIGHLIGHTS
Some advertisers are still facing the supply-chain disruptions and labor shortages
The company is about to repurchase a stock worth up to $500 million
Snap plans to slow our down hiring process and the rate of operating expense growth

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The Snapchat owner has mentioned that some advertisers are still facing the supply-chain disruptions and labor shortages, and plenty of others are contending with rising prices amid record inflation, that has already led to cutbacks while spending on advertising.

Co-founders Evan Spiegel, the CEO, and technology chief Bobby Murphy have agreed to the new employment contracts which would keep them within their jobs for at least by January 2027.

Investors have been expecting the slowest-ever pace of growth for social media ad revenue this year, as rising inflation and different economic woes would cause brands to slash off their marketing budgets.

The second quarter revenue for Snap ended on June 30 which was $1.11 billion, missing analyst expectations of $1.14 billion, as per the IBES data from Refinitiv. The figure has grew up to 13% from the prior-year quarter..

Snap has mentioned in a prepared remarks released within a conference call with analyst that 'We aren't happy with the results that we have been delivering, in spite of the present headwinds.'

Snapchat’s daily active users rose to 18% year-over-year to 347 million, beating consensus estimates of 344 million users.

Snap has been found investing heavily in augmented reality technology and ads, that overlays computerised pictures onto photos and videos of the real world.

According to Jasmine Enberg, the Principal analyst at Insider Intelligence has mentioned that these newer forms of advertising would tend “to go first when the marketing budget are cut.”

The company has also announced on Thursday about a share repurchase program of up to $500 million.

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