Snap Q1 Daily Active Users Jumped 18% To 332M But It Swung To A Loss; CEO Cites “Challenging Operating Environment”
Snapchat parent Snap said its daily active users jumped 18% last quarter to 332 million, beating Wall Street targets but revenue and fell a bit short. The Santa Monica-based company like its rivals faces ad revenue headwinds from Apple privacy policy changes, macro and supply chain issues and labor costs.
Revenue jumped 38% $1.06 billion. It swung to a net loss of $360 million (EPS of negative $0.02) from income of $287 million in the prior year.
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Snap is the first social media/tech company to report this earnings season so is bellwether for the state of the digital ad market ahead of a raft of first-quarter results next week. In Snap’s case, Wall Street is keen to see whether the rise the rise of TikTok and the waning pandemic are also creating headwinds.
Evan Spiegel and Snap execs will host a conference call at 5 pm ET.
Netflix and Snap are very different companies (streaming vs social media) but both have been high-flying, highly-valued growth stocks with Netflix taking a beating this week as growth slows.
Snap has invested heavily in tools and content like Lenses that are popular with its Gen Z audience. Most analysts following Snap rate it a “buy.” The shares closed down 4.29% at $29.44. They are volatile in after-hours trade, dipping first, then rising.
“Our first quarter results reflect the underlying momentum in our business through a challenging operating environment,” Spiegel said. “We remain focused on providing value for our growing community, delivering ROI for our advertising partners, and investing against our enormous opportunity in augmented reality.”
Snap is hosting its annual Snap Partner Summit next week.
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