MNTN CEO Mark Douglas on Snap’s Profit Warning

MNTN CEO Mark Douglas on Snap’s Profit Warning

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Snap has just issued a warning that the macro environment has deteriorated more than expected. The social media company’s stock dropped around 40%, their lowest level since April of 2020. This event also coincided with drops from META, Alphabet, and Twitter.

The Exchange was joined by Mark Douglas, CEO of MNTN, and CNBC Business News Correspondent Julia Boorstin to discuss what this will mean for other online advertisers. 

Douglas pointed out that there are two forms of advertising, brand advertising and performance advertising, and that Snap’s business is evenly split between the two, “I think if you dissected the numbers, where they’re probably seeing all the weakness is brand advertising. That’s the first thing any CFO is going to cut when they want to cut expenses.”

According to Douglas, other companies like Google and Facebook—which focus more on performance advertising—are less likely to be affected long term. “If you look at Google and Facebook, they have millions of advertisers, and those companies are not just going to pack up shop. As a matter of fact, when times are tough as we saw during the pandemic, they actually spent more, and Snap benefitted from that at the time.” He also points out that the rise of TikTok might be a contributing factor in this drop. 

For the rest of the discussion, watch the above video.

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