CNBC's Julia Boorstin sits down with Snap CEO Evan Spiegel to discuss his ad market outlook, what's next for the social media company, the role of AI and more.

Snap CEO Evan Spiegel described the current business environment as uncertain, particularly in the advertising sector. He noted that advertisers are increasingly seeking platforms that deliver measurable results, with Snap seeing a 60% year-over-year growth in advertisers and 75% of its business now focused on direct response advertising.

Spiegel emphasized Snapchat's unique position as a communication service, distinguishing it from other digital platforms that primarily offer video feeds. He also mentioned the company's recent rollout of sponsored Snaps in the United States, which has provided brands with efficient ways to reach large audiences. Despite macroeconomic and geopolitical uncertainties, Spiegel expressed confidence in Snap's ability to help business partners achieve their goals.

Snap CEO says it's an uncertain business environment

Good morning, Carl. That's right. I'm joined now by Snap CEO Evan Spiegel. Evan, thanks so much for talking to us here today. Julia, thanks so much for having me. It's great to be here in beautiful Sun Valley. Very beautiful year, but we're watching some of the stocks and their performance is less beautiful. WPP shares down 16% today on its second morning this year, raising concerns about the state of the ad market. What are you seeing? Are you concerned about the ad market? And should investors be concerned based on the declines of these ad agency stocks today? Well, it's hard to speak specifically to WPP's business, but there's no question it's an uncertain business environment. I think that's why advertisers are gravitating towards platforms that can deliver lower funnel results like Snap. So in Q1, we saw advertisers grow 60% year-over-year and 75% of our business is now direct response. So I think as we've worked over the last couple of years to really position our business for driving lower funnel results for advertisers and really helping small and medium-sized customers grow, I think no matter the business outlook, Snap is well-positioned to help our business partners. So I understand you're in a quiet period now because you have earnings coming up in about a month, but your stock did drop dramatically after your first quarter results. In those results, you warned about macro headwinds. There is so much uncertainty now about tariffs. I know that's a big topic of conversation here in Sun Valley. How are you concerned, big picture, about an economic pullback or pullback in ad spending because of these tariffs and that uncertainty? I think what we really need to do is focus on the important and differentiated role Snapchat can play. I mean, there are just huge tectonic shifts happening right now. Whether they're generational, it's the rise of millennials and Gen Z. Millennials are now the largest adult generation. Of course, artificial intelligence and the role that that's playing in business. And then as you mentioned, the geopolitical uncertainty as well. And I think if you look at what's happened with digital platforms, many digital platforms now look the same. They're essentially feeds of video. And Snapchat's differentiated as a communication service. People use it all day long to communicate with their friends and family. And businesses know that relationships really matter. And brands are often the glue in relationships, whether it's taking my five-year-old son to McDonald's for his birthday or curling up as a family and watching Disney+. Brands have a really important role to play in relationships, which is why they have a really important role to play on Snapchat. But back to this question of the macro uncertainty, because it really was that warning that has weighed on your stock and has really raised concerns for investors, because we didn't see that same macro uncertainty have such a negative impact on rivals like Meta. Given that you are in a quiet period, what can you tell us right now in terms of what you're seeing in terms of advertisers and how they're responding to this geopolitical environment? It's so important for advertisers right now to differentiate to grow their business, which is why I think Snapchat's position as a communication service is so valuable. We recently rolled out our sponsored Snaps product to 100% in the United States, and that's been a great way for brands to reach a really wide audience with a lot of efficiency. And there's some great opportunities for creator and influencer marketing there as well. If you receive a Snap from your favorite actor or Snap star about a new movie they're in, that's been really driving a lot of impact for brands in our service.

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