Bloomberg
Snap Rises After Sales, Consumer Growth Ratings of the Best Analysts
(Bloomberg) – Snap Inc. reports quarterly revenue and daily active users that exceed analysts’ forecasts, boosted by digital advertising campaigns, and users who turn to the company’s social networking and entertainment Snapchat app during the pandemic. The shares gained about 5% in expanded trading. Sales jumped 66 percent to $ 770 million for the period ended March 31, the company said in a statement in Santa Monica, California. Analysts forecast an average of $ 744 million. Snapchat, the mobile application for sending disappearing photos and videos, reported 280 million active users daily during the quarter, up 22 percent from a year earlier and higher than analysts’ forecast of 275.4 million, according to data collected by Bloomberg. The results are likely to support Snapchat’s argument that its investment in augmented reality, new tools for advertisers, support for high-quality creators and recruitment outside of North America will drive revenue growth of more than 50% over several years. “When you analyze the results, it was very good,” said Mandip Singh, an analyst at Bloomberg Intelligence, in the first quarter. Still, “I think they spend more on the content side. They basically buy some content to engage their daily active users. “Last November, Snap released Spotlight, a tool to promote popular videos. The company said it would pay $ 1 million a day to the creators of the most effective publications as part of the program. Nazmul Islam, an analyst at EMarketer, said Spotlight has 125 million users, which helps increase engagement and attract advertisers. expect Snap to have another good performance in the second quarter, driving the momentum of its innovative products, which they continue to launch in more countries, ”Islam said. Snap CEO Evan Spiegel said more people have made new friends, used Snapchat’s mapping tool and published stories that are short-lived videos and photos as the economy began to open in the first months of the year. “We designed Snapchat to be a useful addition to real-life friendships, and we’re excited about these optimistic trends developing with our audiences,” Spiegel said. Shares of Snap closed at $ 57.05 in New York. Shares have gained 14% this year since tripling in 2020. The company forecasts revenue for the current quarter of $ 820 million to $ 840 million, compared to analysts’ average estimates of $ 823.9 million. Snap said daily active users will increase 22% year-over-year to 290 million for the period. The second quarter of Ebitda, a measure of profitability, will range from an equivalent to a loss of $ 20 million. Analysts have forecast a loss of $ 1.3 million. In the long run, the company relies on augmented reality to continue to stimulate greater consumer engagement as they play with a diverse set of lenses or animated overlays on photos and videos. As the e-commerce market thrives during the pandemic, more and more advertisers are experimenting with augmented reality shopping as features that allow Snapchat users to try out beauty products, according to the company. The number of Snapchat users who engage in augmented reality lenses on a daily basis grew by more than 40% year-on-year in the first quarter, the company said. “During the pandemic, advertisers accelerated the adoption of our augmented reality products to enable product sampling and testing when forced to find alternatives to traditional methods,” CEO Jeremy Gorman said in notes. Snapchat said it was uncertain how Apple’s upcoming iPhone software update could affect momentum. The update will require developers to be explicitly authorized to collect certain data and track user activity on apps and websites. “It is not yet clear what the long-term impact of the changes in the iOS platform can be for the peak momentum of our business, and this may not be clear for several months or more after the changes are introduced,” said CFO Derek Andersen in prepared notes. “Until then, we will continue to focus on helping our partners navigate these changes, while optimizing the return on advertising costs in our advertising products and platform,” Andersen said. However, the company said that for the first time, the majority of Snapchat users have used the application of smartphones with the Android operating system. (Updates with analyst comments starting in the fourth paragraph.) For more articles like this, please visit us at bloomberg.com Subscribe now to stay ahead with the most trusted source of business news. © 2021 Bloomberg LP
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