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Snap wars on Q2 guidance - YouTube
Channel: CNBC Television
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snapped is finally an ak time to ceo
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evan spiegel speaking at the jp morgan
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conference in just a couple of minutes
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the company warning quote the macro
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environment has deteriorated further and
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faster than we
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anticipated when we issued our quarterly
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guidance last month saying as a result
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while our revenue continues to grow year
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over year it is growing more slowly than
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we expected at this time saying we
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believe it is now likely that we will
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report revenue and adjusted ebitda below
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the low end of the guidance range we
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provided for this quarter you see snap
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shares are down double digits and this
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is notable because uh melissa we that
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earnings report was just about a month
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ago so it seems like the environment has
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gotten much worse just in the past four
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weeks and we see snap shares are now
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down 18
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evan spiegel will be speaking shortly
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and we will be back with more
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all right julia thank you julia borsen i
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think the key point that julia made was
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just a month ago evan spiegel was
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talking to investors with their earnings
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released so what happened in one month
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and uh how should we project this on to
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other companies guy what's your take
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guy no okay we don't have guy sorry is
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he in timeout
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can i can i jump in because i think this
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is what you would call in the business a
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good segue to the conversation that we
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were just happening okay if you're a
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consumer products brand and you're
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stopping or you're slowing down your
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spend on snap it's because some of the
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trends that you see in your underlying
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business i mean this is happening people
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i talked about it last week okay like
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i'm just saying like so what's going on
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right now we're seeing revaluations in
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private tech we're going to see a ton of
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blow-ups there what do they do they
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spend on aws they spend on reserve they
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spend on facebook ads they send on snap
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advertising and they're going to be
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pulling back and and to me i just think
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this is something that's going to play
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out over the next couple months i hear
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you and and but and i think there's no
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question the guide is coming from
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looking at advertising and looking at ad
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revenue in the places where you know
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snap has actually been a pleasant
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surprise on the growth side of it but
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it's still one of those companies with a
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multiple that makes no sense it's still
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a company that has free cash flow
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dynamics that make no sense for this
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market so you know this is very
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different than talking about a market
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and banks where i think i think you can
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own jp morgan here i don't want to own
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snap here i think there's a lot of i
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think there's a lot of stocks and this
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is you know in the context of this show
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i believe actually markets can go lower
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uh and will go lower from here but i
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don't think that they have to go lower
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today for the next three months and i
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think you know that's to me about the
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last segment i want to get back to jp
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morgan we're talking about snap the
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dynamic with snap is and with other
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companies that are depending on
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advertising dollars is that is a demand
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dynamic we haven't heard from any
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consumer companies about a fall off in
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demand all we've heard about are supply
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chain dynamics and this isn't good right
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um guy we're also watching facebook
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shares now we just put up a screen of
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all the sort of related stocks that are
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also trading lower on the back of the
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snap news
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um is that warranted
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yes the one that i'd be really
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interested i'm sure karen's going to
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agree here is what happens to google i'm
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sure it's lower in the after market i
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think the stock was up 55 or so dollars
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today it's probably down maybe by about
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that in the after hours but to me
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google's the one to watch you know
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google might be the one as crazy as it
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sounds that might be the flight to
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quality in the form of google given that
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they have their you know they have their
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hands in so many different businesses
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they might sort of be insulated from
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this so if google sells off
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precipitously on the back of this i
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think there's your opportunity
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um let's get back to julie borson she's
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got more for us from a memo that she's
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obtained julia
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that's right i've obtained a memo
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written by evan spiegel to snap's staff
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it just went out moments ago as he's
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speaking right now at this jpmorgan
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conference spiegel's striking a little
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bit more of an optimistic note i'm
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talking about the opportunities for the
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company in the long term he writes that
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quote we believe that the progress we've
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made growing our revenue combined with
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the strength of our balance sheet has
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positioned us well for the current
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environment i'm saying that 2022 remains
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a significant investment year for snap
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despite the ongoing volatility he says
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that they will slow their pace of hiring
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they do expect to hire more than 500 new
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team members between now and the end of
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the year that's 10 head count growth and
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that's in addition to the 900 job offers
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that have already been accepted this
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year so still hiring but at a slower
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pace he also said that they will be
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evaluating the remainder of 2022 budgets
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to find cost savings um so really
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notable to to hear that kind of caution
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though certainly more optimistic tone
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that we than we got in that ak filing
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but shares down 20 melissa will be
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listening into what he has to say in
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that q a session happening right now
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you
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