UBS defends Snap in light of layoffs, says slowing growth 'likely bottomed' in July
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UBS defended Snap (NYSE:SNAP) on Thursday, as the investment firm said slowing growth "likely bottomed" in July and improved in August, with the potential to accelerate due to easier comparisons and tech improvements.
Analyst Lloyd Walmsley, who has a buy rating and a $15 price target on Snap (SNAP), noted that the estimated 12% growth in August came from easier comparisons, but also "modest improvements" in spending.
"We see the potential for an improving growth outlook and more cost discipline to drive positive consensus estimate revisions and multiple expansion in Snap shares," Walmsley wrote to clients. 
The analyst added that Snap's (SNAP) improvement in August "bodes well for the rest of the online ad space." 
Snap (SNAP) shares were fractionally lower to $10.84 in premarket trading.
On Wednesday, Snap (SNAP) confirmed that it was laying off 20% of its company and that revenues for the current quarter were tracking at an 8% year-over-year gain, well below expectations.
Walmsley pointed out that if the rest of the third-quarter can grow at 12%, which would be "in line" with the most recent period, third-quarter revenue growth would be just under 10% year-over-year. From there, comparisons get easier, even if the ad market is still "uncertain."
Snap (SNAP) recently saw an executive shakeup, as Netflix (NFLX) hired its chief business officer, Jeremi Gorman, and its vice president of ad sales, Peter Naylor.