And that was not a great day for Snapchat.

The company issued a guidance note to the SEC which advised that Snapchat's overall revenue will miss the targets that it communicated in its Q1 earnings update, which it reported just last month.

Here's what Snap had to say:

The macro environment has turned even more and sooner than we expected since we issued our guidance on April 21, 2022. We think we should expect to report revenues and adjusted EBITDA below the low end of our Q2 2022 guidance range.

In light of the wars going on in Ukraine, the pandemic that continues to affect the whole world, and labor shortages in several regions, it isn't a huge surprise that Snap is dealing with more stringent conditions when it comes to operating. This guidance from Snap was issued so shortly after it expressed its prospects, which is quite worrying, pointing to a fast-changing environment, especially for companies such as Snap which relies on European income and brand advertising.
"As soon as Snap lost its third-quarter target, the shares of the maker of Snapchat fell as much as 41 percent, erasing $15 billion in market value from the company.".

But it wasn't just Snap that was affected. The broader impact that these same factors will have for other social apps means Meta, Twitter, Google, and Pinterest also fell too, with billions shaved from the values of digital ad providers.

What exactly the full impacts of the current market conditions will be, we don't know-but Snap is obviously not in the clear yet. The assumption would be that this is part and parcel of what many have to take when it comes to sub zero to negative deviation in advertising spends while also fighting a rising cost amid a fluctuating economic situation, mainly in Europe.

The slide has opened doors for speculation on a variety of different lines, including what it will mean for Twitter, which is in the middle of Elon Musk's takeover bid, and whether Snap, at a lower price than its 207 IPO, could now attract new suitors looking to get in on the AR wave.

One of those suitors could, in fact, be Meta-with that seeming unlikely in light of the pressure the company is under over previous anti-competitive takeover activity. However, it could be a means for Meta to buy up a big player in the AR market, as part of its broader metaverse push.
Meta, of course, offered $3 billion back in 2013 to acquire Snapchat when the app was on its initial rise, which Snap CEO Evan Spiegel notoriously declined. And while almost a decade has passed since then, Snap still plays in space; and nobody outruns its nous for AR development, coupled with the resulting viral trends on the same; which may well be an alluring bait for Meta to wait when it will seek to take the best angles to pitch its AR glasses to the masses.

Meta Spectacles would likely sell many more copies than Ray Ban Stories or any variation of the same, and the added power of Meta would significantly boost Snap's own AR ambitions.

Needless to say, there is nothing going on inside the organization with leaks or rumors in the pipeline to go along with this, but at a low ask, and on the cusp of the next stage of digital connection, Snap will no doubt be an attractive proposition for several potential suitors.

Snapchat also continues to grow, and in its SEC guidance note, it too points out potential for more:

"We remain excited about the long-term opportunity to grow our business. Our community continues to grow and we continue to see strong engagement across Snapchat and continue to see significant opportunities to grow our average revenue per user over the long term."

As a consequence of these challenges now, however, Snap will pace the hiring for the remainder of the year, which will inevitably impact the development of its own AR tools and options as others continue to move forward in the space.

But again, all platforms dependent on digital ads will be feeling the same pinch, and it'll be interesting to see if others follow: