Shares of Snap Inc. (NYSE: SNAP) plummeted 26% on Friday, after the corporate delivered combined outcomes for the second quarter of 2024 a day in the past and supplied third-quarter steering that didn’t impress the Road. Listed here are the important thing takeaways from the earnings report:
Quarterly numbers
Snap generated revenues of $1.24 billion for Q2 2024, which rose 16% year-over-year however fell beneath estimates of $1.25 billion. GAAP internet loss narrowed to $0.15 per share from $0.24 per share final yr. Adjusted EPS amounted to $0.02, which got here in step with expectations.
Consumer progress and engagement
Snap’s month-to-month lively customers (MAUs) reached over 850 million in Q2, because it goals for 1 billion MAUs. Each day lively customers (DAUs) stood at 432 million, which was up 9% YoY. DAUs in North America dipped barely to 100 million, whereas DAUs in Europe grew 3% to 97 million. Remainder of World DAUs grew 16% to 235 million in Q2.
In the course of the quarter, Snap noticed enchancment in content material engagement with international time spent watching content material rising 25% YoY. World content material viewers grew 12% YoY in Q2. Development in engagement was primarily pushed by progress in complete time spent watching Highlight and Creator Tales.
Promoting
Within the second quarter, Snap’s promoting income elevated 10% YoY to $1.13 billion. Direct response (DR) promoting income rose 16% YoY, supported by robust progress in lively advertisers and early contributions from product enhancements. Model-oriented promoting income fell 1% YoY, primarily on account of weak demand in sure shopper discretionary verticals reminiscent of retail, expertise, and leisure.
In the course of the second quarter, Snap witnessed power in DR in North America, helped by sturdy progress within the small and medium-sized buyer phase. Model-oriented demand remained weak on this area. The corporate witnessed continued progress on its DR advert platform in each Europe and Remainder of World through the quarter whereas the demand atmosphere for brand-oriented promoting options remained comparatively secure in Europe.
Outlook
For Q3 2024, Snap expects income to vary between $1.33-1.37 billion, representing a progress of 12-16% YoY. The corporate anticipates DAUs will attain approx. 441 million within the third quarter.
