Snap Inc.'s share price stumbled Wednesday after the company disclosed Snapchat's user growth that failed to meet Wall Street expectations. But the reaction to user trends obscured gains for Snapchat's programmatic advertising platforms.
"Their programmatic offering is working," said Martín Utreras, eMarketer's vice president of forecasting.
Utreras noted that Snap's second-quarter revenues rose despite declines in user engagement and ad prices. In other words, "programmatic is being driven by strong advertiser demand," he said.
Snap's second-quarter revenues jumped 44% over the year-ago period, and average revenue per user rose 34%.
The positive programmatic trends were initially overshadowed by concerns about user growth. The company said the number of daily active users (DAUs) in the second quarter was 188 million, up 8% from the same quarter last year, but down from Q1 2018.