Snap’s inventory is falling as iPhone privacy controls sales of pinch ads

SANTA MONICA, Calif. (AP) – Snapchat’s parent company announced Thursday that ad sales will be impacted by a privacy crackdown launched on Apple’s iPhones earlier this year, fueling investor fears that financial growth the app goes into a tailspin.

The reveal in Snap Inc.’s third-quarter earnings report sparked an after-hours sell-off that could anticipate one of the largest one-day declines in the company’s stock since it went public in 2017.

Snap’s shares fell nearly 22% in expanded trading Thursday. If this decline is reflected in Friday’s regular trading session, it will approach the stock’s previous one-day low in May 2018, when the price also fell nearly 22%. A drop of this magnitude would wipe out nearly $ 30 billion in shareholder property.

The alarms triggered by Snap’s disappointing performance could anticipate problems for other apps that may have more trouble tracking their users’ online activities due to an Apple update to the iPhone’s iOS software released in April.

The change blocks online tracking on iPhones unless a user gives explicit permission to do so.

In a statement, Snap CEO Evan Spiegel said the Santa Monica, Calif. Company had to recalibrate its operations to “face significant headwinds, including changes to the iOS platform that are affecting the way it is advertised “.

Facebook, an outspoken critic of Apple’s new privacy controls, had already told investors that ad sales could suffer from the change, but Snap’s results suggested that the blow could possibly be even bigger than Wall Street expected . Facebook shares lost more than 4% in extended trading on Thursday. The social networking company is expected to release its latest quarterly results on Monday.

Snap reported sales of $ 1.07 billion for the July-September period, up 57% from the same point last year, but that was about $ 30 million lower than what Wall Street analysts forecast manage investor expectations.

Perhaps even more troubling to investors, Snap predicted that current quarter revenue will range between $ 1.17 billion and $ 1.21 billion. According to FactSet, analysts had forecast sales of 1.36 billion US dollars.

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