Shocking second-quarter results from Snap sparked a 38% drop in the stock price on Friday.

After falling short of Wall Street's expectations, the company announced that it would reduce staffing levels. Apple's 2021 iOS update, competition from companies like TikTok, and a challenging economy contributed to Facebook's poor results

In spite of the current headwinds, the company announced that it was dissatisfied with the results it was delivering.

Although our own quarterly industry checks have been muted, they have been more optimistic than this earnings report since the beginning of the year.

Despite TikTok's rapid growth and high level of engagement, JPMorgan analysts did not specifically mention its impact on Snap's business when they lowered their price target on the stock.

Analysts at JPMorgan were also concerned that CEO Evan Spiegel was silent during the analyst Q&A portion of the earnings report, and did not offer any upfront comments.

Snap has an even greater challenge ahead of it after the results of 2Q and the way the call was handled," they said, adding that the company needs to "re-establish a track record of execution."

Snap's revenue is "approximately flat" this quarter, according to the company. The company did not provide third-quarter guidance because "forward-looking visibility remains incredibly difficult."