The use and value of social media applications have become anything but imperative in our lives. A major chunk of the globe has access to platforms like Facebook, Instagram, Twitter and more. Snap Inc. (NYSE: SNAP), the creator of Snapchat, has been losing traction for the past few weeks. SNAP stock traded at $11 yesterday, April 04, down by over 2% since its previous close.
Recent Financials Were a Disaster
The company received a $110 Billion financial blow in 2022, according to its recent financial stats, Forbes reported. However, Credit Suisse, an investment banking company, increased its rating, potentially due to the better-than-expected revenue in Q4 2022. Financials highlight the social media giant generated $1.3 Billion in revenue.
Several companies have started seeing social media platforms as promotional grounds. It isn’t unknown that these networks are attracting top guns extensively to advertise themselves. Nonetheless, Snap Inc. is certainly going through harsh times. Digiday, a New York-based trade magazine, reported that digital media companies aren’t getting desired outcomes from the platform.
A digital media company told Digiday that Snapchat declined their request to add new channels on their platform. It added that its monthly revenue from Snapchat has descended by nearly 60%. Content on the network is proving unprofitable for businesses which may affect Snap Inc. in the long run.
SNAP Stock Price Analysis
2022 remained a cold year for several companies crashing innumerable stocks. The chart highlights a price uptrend in SNAP stock during January 2023, gaining 40%. However, value started shrinking the following month, leading the price down by 20% in mid-February.
Disjoint channels point towards decreasing volatility, supported by the true average range. If the momentum persists, SNAP stock may enter a consolidation. Neither the chop zone underscores a trend, making it less likely for company shares to show any considerable swing. Currently, the price holds support near $10 and resistance around $12.
Moreover, the price has sustained $13 and $8 levels since July 2023. Pitchfork shows the next stop might go near the former again. Fib circles highlight the stock value is maintaining a pattern similar to November 2022, creating a resistance of around $12.
From individual users to companies, services these social media platforms go beyond socialization. Moreover, artificial intelligence (AI) has rendered utilizing these networks exceptionally easy, helping companies expand their user base. Data shows that over 4 Billion people are using these networks globally. With such a vast number of consumers, companies in this sector tend to withstand fierce competition to grow their worth.
Disclaimer
The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.
Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.
Source: https://www.thecoinrepublic.com/2023/04/05/will-the-momentum-change-course-as-snap-stock-falls-in-pre-market/