The share price of Snap Inc. dropped late last month after the tech company reported disappointing second-quarter earnings that included increased net losses and revenue declines.

Shares in the Santa Monica-based technology company that owns social media app Snapchat closed at $12.51 on July 25. The next day it dropped 14% to close at $10.73.

Snap shares closed at $10.79 on Aug. 3, a 22% increase in value from the start of the year when it closed at $8.85.

Snap lags behind some other social media companies while it outperforms others. 

Menlo Park-based Meta Platforms Inc., which owns Facebook, for example, had a closing price on Aug. 3 of $313.19, a 55% increase in value from the start of the year when it closed at $122.82. Pinterest Inc. in San Francisco, meanwhile, closed at $27.16, a 7.7% increase in value from the start of the year when it closed at $25.23.

Snap reported on July 25 an adjusted net loss of $33 million (-2 cents a share) for the quarter ending June 30, compared with a net loss of $30 million (-2 cents) in the same period of the previous year. Revenue decreased by 4% from the second quarter of the prior year to $1.1 billion.

Evan Spiegel, chief executive of Snap, said that in terms of growing revenue, the company is focused on three key priorities.

“First, investing in our products to sustain community growth and deepen engagement,” Spiegel said in a conference call with analysts to discuss second-quarter earnings. “Second, investing heavily in our direct-response business to deliver measurable return on spend for our advertising partners. Third, cultivating new sources of revenue to diversify our top-line growth to build a more resilient business.” 

Regarding the third priority, Spiegel said that Snap made progress with its subscription service Snapchat+, which has more than 4 million subscribers. He was also pleased with the early progress of AR Enterprise Services, Snap’s first software-as-a-service offering, which is designed to help retailers use Snap’s augmented reality platform. And finally, the company completed a global rollout of My AI, Snap’s artificial intelligence-powered chatbot and recently began testing of sponsored links in conversation with My AI.

“While we are still far from achieving the revenue growth to which we aspire, we believe that the momentum we have established in community growth and content engagement, the significant improvements we are seeing in return on investment for direct-response advertisers, and the early growth of Snapchat+ to more than 4 million subscribers, demonstrate progress and further validate our strategic focus,” Spiegel added.

The company is calibrating its investment levels to build a path to free cash flow-breakeven or better, even with reduced rates of revenue growth, he continued. 

Snap will continue to invest with a long-term perspective, especially in areas that are critical to realizing the long-term opportunity of augmented reality, he said. 

“While our strategic investments in cloud-based (machine learning) infrastructure have put downward pressure on margins in the short term, there are early signs that the improvements to ranking and personalization of our content and ad platforms are leading to deeper engagement with content by our community and stronger returns on investment for our advertising partners,” Spiegel said during the call.