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In its Q2 financial report, which was announced on Thursday, Snap reported a $422 million loss and a "significantly" reduced rate of hiring, which caused its share price to drop 26 percent in after-hours trading.

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The stock market meltdown was largely brought on by significant losses: the $422 million loss is about twice as large as the $152 million loss in the second quarter of 2021 and is an increase of 17% over Q1's $360 million loss.

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The figures weren't all negative, either.

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Revenue for Snap came to $1.11 billion, up somewhat from the $1.06 billion it reported in the first quarter but down significantly from the $1.14 billion expectation made by Wall Street.

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With 347 million daily active users, up from 332 million in the first quarter and exceeding Wall Street's forecast of 343 million, Snap's user base also increased by 4.5 percent.

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Inflation and rising interest rates, as well as a decline in advertising revenue, were cited by Snap as the causes of the escalating losses.

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Derek Andersen, chief financial officer of Snap, stressed the need to reduce operating costs during an earnings call on Thursday afternoon. This will result in a "substantial slowdown" in the company's hiring expansion.

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According to the investor letter, revenue for the third quarter is off to a fairly flat start, but executives on the earnings call stated that Snap is concentrating on diversifying its revenue sources and investing in its augmented reality features, which Andersen called the company's "longest-term, most promising opportunity."

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Snap's investor letter for the second quarter of 2022 states, "The second quarter of 2022 proved more tough than we planned."

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Executives from Snap emphasised in their investor letter for the second quarter and during their results call that forecasting the future is "extremely difficult," so the firm "does not intend to provide financial guidance for Q3."

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Even said, the business is planning for the long term: The investor letter states that CEO and CTO cofounders Bobby Murphy and Spiegel will remain in their positions through at least 2027.

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