Snap stock plunges 19% on Q1 revenue miss

Snap (NYSE:) shares plummeted more than 19% after-hours following the company’s reported , with revenue of $988.6 million (down 7% year-over-year) missing the consensus estimate of $1.01 billion. Demand was disrupted by the changes the company made to its ad platform to drive more click-through conversions, and as advertisers adapt their measurement solutions to these new objectives.

Q1 EPS came in at $0.01, compared to the consensus estimate of ($0.23). Daily Active Users rose 15% year-over-year to 383M. DAUs increased sequentially and year-over-year in each of North America, Europe, and Rest of World. Total time spent watching Spotlight content increased more than 170% year-over-year.

“We are working to accelerate our revenue growth and we are using this opportunity to make significant improvements to our advertising platform to help drive increased return on investment for our advertising partners,” said CEO Evan Spiegel.

The company didn’t provide formal guidance for Q2/23 revenue or adjusted EBITDA, noting that it expects to face continued disruption in demand related to the advertising platform changes initiated early in Q1.

The company’s internal forecast for Q2, which assumes DAUs of 394-395M, sees revenue at $1.04B, which represents a 6% decline year-over-year, and is below the Street estimates.