Snap stock soars on earnings beat, quarterly profit milestone
Snap Inc.'s stock jumped more than 50% in after-hours trading Thursday after the tech giant posted its first-ever quarterly net profit as a public company, while also beating Wall Street estimates on revenue and user growth.
Why it matters: Snapchat's massive beat stands in stark contract to Facebook, which lost more than $200 billion in market value yesterday after reporting weak first quarter guidance, attributable in part to changes to Apple's privacy policies, impacting Facebook's ad business.
Details: The self-proclaimed "camera company" touted new investments in its augmented reality products and content partnerships. Those investments contributed to higher user engagement in some areas.
- For example, the number of users of its TikTok competitive feature, "Spotlight," that subscribed to a creator on the platform more than doubled relative to the prior quarter, the company said.
- Snap said it added 160 new international channels for its premium content platform called "Discover."
- “The strength of our core business has enabled us to accelerate our investments in augmented reality, transforming the way that the Snapchat community experiences the world through our camera,” said CEO Evan Spiegel in a statement.
By the numbers, per CNBC:
- Earnings per share: 22 cents, adjusted vs 10 cents expected, according to a Refinitiv survey of analysts
- Revenue: $1.3 billion vs $1.2 billion, according to Refinitv
- Global Daily Active Daily Users (DAUs): 319 million vs 316.9 million, according to StreetAccount
- Average Revenue per User (ARPU): $4.06 vs $3.79, according to StreetAccount
What to watch: Snap says it expects to make over $1 billion in revenue this quarter, up 33% from the first quarter of 2021. It also anticipates breaking even in the first quarter.