Snap is 'distributing' its engineering teams to provide more 'direct support' to its business functions, the social media firm said on August 5, with the monetisation engineering team now reporting to Ajit Mohan, chief business officer of the Snapchat parent company.
The core applications team will report to Snap's chief technology officer Bobby Murphy, while the chief information officer and chief information security officer will report to Snap chief executive Evan Spiegel and lead enterprise-wide foundational infrastructure and platform integrity, Spiegel said in a letter to shareholders.
"While we are moving quickly to realize the full potential of our business, we believe there is an opportunity to better align Snap’s engineering and technology investments with our business priorities," Spiegel said.
"This new, distributed structure will empower our teams to take greater ownership and drive continued innovation for our community and advertising partners," he added.
As part of the change, Eric Young, Snap’s senior vice president of engineering, is leaving the company to “pursue a new opportunity”, according to the letter.
Mohan was appointed Snap's chief business officer in February to oversee the company's advertising business across all regions and to lead its revenue product and business operations organizations. He joined Snap in November 2022 as the president for the Asia Pacific (APAC) region.
Snap's advertising woes
These moves come as Snap struggles with slowing advertising growth amidst rising competition for ad dollars.
The company saw its revenues grow by a modest 9 percent year-on-year (YoY) to reach 1.34 billion in Q2 2025 while losses increased to $263 million, compared to $249 million in the same quarter last year.
"Our rate of topline growth was impacted by a number of factors in Q2, including an issue related to our ad platform, the timing of Ramadan, and the effects of the de minimis changes," Snap CFO Derek Anderson said in the company's earnings call.
"Unfortunately, in our efforts to improve advertiser performance, we shipped a change that caused some campaigns to clear the auction at substantially reduced prices. We have since reverted this change and advertising revenue growth has improved as advertisers adjust their bid strategies to achieve their objectives," he said.
In comparison, larger rival Meta saw its ad revenues increase by 22 percent to $47.5 billion in Q2 2025. Reddit's advertising business also surged by 84 percent YoY to $465 million for the quarter.
"What we saw in April is that ad revenue growth declined to approximately 1 percent (from 9 percent revenue growth in Q1) before largely recovering as we moved through May," Anderson said.
Post the rollback of the ad change, the company has seen ad revenue growing at a rate of 3-4 percent through June and July, he added.
Spiegel was, however, upbeat about the broader rollout of its Sponsored Snaps advertising unit, which enables businesses to deliver full-screen vertical video Snaps as sponsored messages in users' chat inboxes.
During the call, he stated that Sponsored Snaps are proving "highly effective in driving incremental conversions, delivering up to a 22 percent increase when included in an advertiser’s broader Snap campaign mix."
"Sponsored Snaps represent a significant new pool of inventory for our advertising business...In the near term, this is delivering ROI for advertisers in the form of incremental reach and additional conversions that we believe will translate into incremental top line growth over time as we build demand and continue to enhance the performance of this new product" he said.
Snapchat+ reaches 16 million subscribers
Snapchat+, the company’s monthly subscription service, is also approaching 16 million paying subscribers, up from 15 million in the prior quarter. These subscription revenues make up a bulk of the company's Other Revenue segment, which grew by 64 percent YoY to reach an annualized run rate of nearly $700 million.
Snap also recently launched a new subscription tier, Lens+, that offers access to exclusive new AI video Lenses, and Bitmoji Game Lenses, as well as early access to new features.
Snapchat's overall daily active users rose 9 percent to 469 million in Q2, while monthly active user base grew to 932 million, registering a 7 percent increase.
India is one of the biggest user markets for Snapchat with over 250 million monthly active users. The country, which has one of the world's youngest populations, is also a crucial region for the future growth of the ephemeral messaging app.
Snap's AR investment
In June, Snap announced plans to publicly launch its first standalone lightweight Specs AR (Augmented Reality) glasses in 2026. These glasses will be "significantly smaller, lighter, and more capable" than the firm's 5th generation Spectacles released to developers in 2024, Spiegel said on the earnings call.
"We have made a long term and consistent investment in augmented reality, committing more than $3 billion over the past 11 years to develop the world’s only full stack, vertically integrated augmented reality platform," he said.
Rival Meta is also betting big on smart glasses to drive the next wave of computing beyond smartphones. In September, the social networking giant had unveiled the first functional prototype of its Orion AR glasses.
In May, Google had announced partnerships with eyewear brands Warby Parker and Gentle Monster to develop AI-powered glasses based on Android XR, a mixed-reality operating system for headsets and smart glasses with built-in Gemini.
Read: India tops Snapchat's AR lens charts; developer community up 50% in 2 years: Bobby Murphy
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