Snap CEO Evan Spiegel gives updates, strategy for digital advertising business

Snap (SNAP) CEO Evan Spiegel sent the following note to team members on September 3. The note said in part: “You may be wondering why, with all of the progress we’ve made in our business over the last year, our share price performance has lagged the overall market. The answer is simple: our advertising business is growing slower than our competitors. The growth of our digital advertising business is one of the most important inputs to our long term revenue potential, and investors are concerned that we aren’t growing faster. …In Q2, even as our upper funnel brand revenue declined by 1%, our lower funnel direct response revenue grew by 16%. Over the years, we have found that lower funnel revenue generated by small- and medium-sized customers is more predictable and stable than upper funnel revenue. …With active advertisers more than doubling year over year in Q2, we’ve made a lot of progress, but there is more work to do. As we look ahead to 2025, we need to grow our lower funnel business even faster while simultaneously reaccelerating the growth of our upper funnel business. We’re going to do that by changing the way that we go to market, introducing new ad placements powered by automation, and continuing to invest in our machine learning platform to deliver powerful results for our advertising partners. Other companies in the social media space include: Meta Platforms (META), Google (GOOGL, GOOG), and Pinterest (PINS).