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Investing.com – Contextlogic stock (NASDAQ:WISH) slumped by 29% in Friday’s premarket trading as the ecommerce platform’s second-quarter performance deteriorated on most metrics including revenue, income and user engagement.
June-quarter revenue fell 6% from the same period a year ago to $656 million as daily user activity and active buyers on its ‘Wish’ platform declined more than it had anticipated, particularly in the U.S., France and Italy – three of its largest markets.
Globally, ContextLogic saw a 13% reduction in app installs and a 15% fall in average time spent on its platform compared to January-March as people stepped out after a year of being home-locked and highetened level of pandemic-induced shopping came off.
There were more woes for the company. The cost of digital advertising on leading ad platforms, which the company has historically used to drive demand and conversion on its app, increased more than it expected. In addition, the recent privacy changes for iOS caused more advertisers to shift spend to Android devices, creating more competition for a limited supply of impressions.
Updates to Apple’s (NASDAQ:AAPL) privacy policy have made it tougher for apps to track users and source their personal data for targeting them with their ads.
As a result, the company incurred higher marketing costs but ended up achieving lower efficiency.
The net loss soared to $111 million from $11 million in last year’s June quarter.
