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The Snapchat owner’s shares plunged 29.8% in premarket trading as it declined to make a forecast and said record-high inflation and increasing competition hurt advertising demand.
Nasdaq futures fell the most among its peers, with Meta Platforms Inc and Alphabet (NASDAQ:GOOGL) Inc involved in online ad tech dropping 4.8% and 2.9%, respectively.
Twitter Inc (NYSE:TWTR) shed 2.1% before reporting its quarterly results, while Meta and Alphabet were set to post their earnings next week along with other Big Tech firms including Apple Inc (NASDAQ:AAPL), Microsoft Corp (NASDAQ:MSFT) and Amazon.com Inc (NASDAQ:AMZN).
Investors are bracing for the slowest ever global revenue growth for the social media sector as intensifying competition from TikTok and Apple in advertising threaten to compound economic woes in the second quarter.
All three of Wall Street’s main indexes are still set to end the week with their biggest gains in almost a month, with growth stocks doing most of the heavy lifting after markets cheered quarterly reports from Tesla (NASDAQ:TSLA) Inc and Netflix Inc (NASDAQ:NFLX).
The U.S. Federal Reserve is expected to raise interest rates by 75 basis points next week to curb runaway inflation, followed by second-quarter U.S. gross domestic product data, which is likely to be negative again.
Two quarters of negative GDP would mean the United States is in a recession.
At 6:32 a.m. ET, Dow e-minis were down 2 points, or 0.01%, S&P 500 e-minis were down 10.5 points, or 0.26%, and Nasdaq 100 e-minis were down 68.25 points, or 0.54%.
Of the 91 S&P 500 companies that have reporting earnings so far, 78% topped expectations. Analysts now see year-on-year S&P 500 profits to grow 6.3% for the second quarter, down from the 6.8% estimate at the start of the three-month period, according to Refinitiv data.
