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Axios Visuals

Snap Inc., the parent company of camera app Snapchat, saw its stock rise nearly 16% in after-hours trading Wednesday, after the company reported record revenues and lowered the margins on its losses.

Why it matters: Wall Street was looking for consistency from Snapchat last quarter, after a tumultuous year in which it lost several high-level executives, suffered a few internal leaks, and faced blowback for the rollout of an app redesign.

By the numbers, per CNBC:

  • Loss per share: 4 cents vs. 7 cents forecast by Refinitiv
  • Revenue: $390 million vs. $378 million forecast by Refinitiv
  • Average revenue per user: $2.09 vs. $2.05 forecast by FactSet
  • Global daily active users: 186 million vs. 184.26 million forecast by FactSet

Yes, but: The company reported that growth of its user base has basically been flat, but that was better than actually losing ground, as it did the previous quarter.

Be smart: Record revenues and lowered losses were expected. The company typically posts higher ad revenues in the fourth quarter of the year, thanks to holiday ad demand. The company's recently departed CFO Tim Stone said upon his departure that the company expected to come in near the top end of guidance for Q4.

  • "We are substantially closer to achieving profitability, with our Q4 adjusted EBITDA loss of $50 million representing a 68% improvement when compared to Q4 of last year," CEO Evan Spiegel said in prepared remarks.
  • The company had said in its last earnings report that it expected an EBITDA loss of $75 million to $100 million.
  • Operating expenses in the quarter were down 9% year‐over‐year.

The big picture: Wall Street has been skeptical of Snapchat's ability to grow its user base after a year of stalled growth, partially attributable to a redesign and also to the company's efforts to redevelop its technology to better serve Android users globally.

  • Spiegel said the company is focused on building a foundation for Snap to grow over the long term by "driving sustainable product innovation, scaling our advertising platform, and hiring the leadership team that will help us achieve our future goals."

New stats: The company now says it reaches 70% of the total 13- to 34-year-old U.S. population with premium mobile video ads on a monthly basis.

  • On average, it says over 70% of users played with or viewed a "Lens," Snapchat's form of augmented reality, every day.
  • Following its redesign, Spiegel says in prepared remarks that 30% more people are now watching Snapchat's "Publisher Stories and Shows" (video content) every day compared to last year.

Go deeper

Updated 1 hour ago - World

Mexican President López Obrador tests positive for coronavirus

Mexico's President Andrés Manuel López Obrador during a press conference at National Palace in Mexico City, Mexico, on Wednesday. Photo: Ismael Rosas/Eyepix Group/Barcroft Media via Getty Images

Mexican President Andrés Manuel López Obrador announced Sunday evening that he's tested positive for COVID-19.

Driving the news: López Obrador tweeted that he has mild symptoms and is receiving medical treatment. "As always, I am optimistic," he added. "We will all move forward."

Sarah Huckabee Sanders to run for governor of Arkansas

Sarah Huckabee Sanders at FOX News' studios in New York City in 2019. Photo: Steven Ferdman/Getty Images

Former White House press secretary Sarah Huckabee Sanders will announce Monday that she's running for governor of Arkansas.

The big picture: Sanders was touted as a contender after it was announced she was leaving the Trump administration in June 2019. Then-President Trump tweeted he hoped she would run for governor, adding "she would be fantastic." Sanders is "seen as leader in the polls" in the Republican state, notes the Washington Post's Josh Dawsey, who first reported the news.

Coronavirus has inflamed global inequality

Illustration: Aïda Amer/Axios

History will likely remember the pandemic as the "first time since records began that inequality rose in virtually every country on earth at the same time." That's the verdict from Oxfam's inequality report covering the year 2020 — a terrible year that hit the poorest, hardest across the planet.

Why it matters: The world's poorest were already in a race against time, facing down an existential risk in the form of global climate change. The coronavirus pandemic could set global poverty reduction back as much as a full decade, according to the World Bank.