Snap (SNAP) reported fourth-quarter 2022 results on Jan. 31, beating analyst expectations for revenue and user growth, but reporting a net loss and weak outlook for the first quarter of the year,
Here are the key numbers from Snap’s report compared to Wall Street forecasts:
Fourth quarter earnings: actual $1.3 billion versus expected $1.31 billion.
Adjusted earnings per share (EPS): 14 cents versus the expected 11 cents.
Daily Active Users (DAU): 375 million units. Estimated 374.7 million.
The company also reported a net loss of $288 million, which fully compares to the $23 million that Snap reported at the same time last year.
Looking ahead, Snap’s Q1 2023 earnings guidance suggests a decline “from -10% to -2% year-over-year.” However, this must be provided by an insider and the company has refused to provide official information to consistent third parties. The Los Angeles-based company added that it expects the number of DaU to increase from 382 million to 384 million in the first quarter of 2023.
“As we strive to accelerate revenue growth, we are constantly challenging and innovating to increase our advertiser ROI and seek greater collaboration with our community,” said CEO Evan Spiegel.
Snap shares are down about 13% after the close.
Snap ended 2022 with competition engulfing the company throughout the year.
Today’s results mark the end of a long 2012 for Snap. While it’s been a tough year for Big Tech in general, it’s been a very tough year for Snap. A slowdown in digital advertising, high inflation, and fast-growing competition from TikTok will drive the company’s share price down by around 80% by 2022.
Snap laid off 20% of its workforce in August, affecting 1,300 employees. The segment is high profile, featuring exclusive short shows created using Pixy cameras and Original Snap, as well as celebrities and influencers. Back then, Snap screwed its executives, too.
The stakes for Snap are high today as Wall Street grows increasingly skeptical about the company’s prospects. To that end, Snap has seen several valuation moves recently, including JMP Securities and Lasso.
Snap is trying to slow down sellers, and if the company’s message gets across, we don’t expect it to stop one day. Advertising is Snap’s business now. For the fourth quarter of 2021, Snap said in its U.S. filing. Investors read the letter; “We believe that by increasing ROI, we will be able to grow our portfolio in a highly competitive environment.”
Snap fell 14 percent in its fourth-quarter report and warned of falling sales.
Snap (NYSE: SNAP) shares fell more than 14% in the hours after the company released its fourth-quarter results. This slowdown is reflected in revenue growth as digital advertising continues to struggle.
Fourth quarter EPS was $0.14, beating the consensus estimate of $0.11. Revenue of $1.3 billion was flat year over year (up 2% year over year at constant exchange rates), in line with consensus expectations.
The fourth quarter was the most optimistic, the company said, with demand for its branded retail business down 11% year over year and disaster recovery activity down 4% year over year.
DSU grew 17% year over year to $375 million in the quarter. Year after year, DAU will continue to grow in North America, Europe, and the rest of the world.
Snap said in the letter to the money that 2022 has been a difficult year as it continues to be impacted by economic headwinds, changes in platform behavior, and increased competition.
The company expects DAU to be between 382 million and 384 million in the first quarter of 2023. On payroll, the company expects the business environment to remain challenging while expecting the wind to change into the first quarter of next year.
Due to the uncertainty in the business environment, the company has neither adjusted its EBITDA nor its earnings guidance for the first quarter. The company confirmed that quarter-on-quarter revenue fell 7 percent year-on-year. Internal administration accounts for 2-10% of revenue in the first quarter compared to the previous year.
Snap shares fall 15% as earnings growth falters
Snapchat’s parent company has forecast flat revenue growth and a substantial net loss for the final quarter of 2022.
Snap’s quarterly revenue of $1.3 billion was about the same as last year. For the full year, Snap’s revenue grew 12 percent, which the company attributed to “slow growth in digital advertising.”
This quarter of things is even more difficult. Snap reported that first-quarter revenue fell just 7 percent year over year. We expect revenue in the first quarter of the year to increase between 2 and 10 percent year-on-year. (Snap said there was no specific guidance for the quarter, but the numbers were included in a letter to investors.)
Snap, on the other hand, reported a net loss of more than $288 million for the quarter, compared to a net income of $22.5 million in the same period last year.
Snap’s shares fell 15 percent in after-hours trading after the news broke.
The quarterly report shows that Snap is struggling as competition in the social market increases, business disruptions due to changes in the privacy of Apple’s apps, and reduced demand from advertisers amid fears of an impending recession. Net losses were net. High-interest rates and inflation are also hitting many big tech companies.
Snap’s earnings could cause concern for other digital tech giants gaining market share, including Facebook parent Meta and Google parent Alphabet, which reported doubled earnings this week.
Snap posts worst-ever holiday quarter revenue growth, shares fall after earnings deterioration
Snapchat’s parent company reported the worst annual revenue growth in Snap’s history, with fourth-quarter revenue unchanged from last year at $1.3 billion. The company reported earnings of 1 cent per share last year and a loss of $288.5 million, or 18 cents per share.
Analysts polled by FactSet expected earnings of $1.3 billion and a loss of 11 cents per share. Shares fell more than 14% in after-hours trading shortly after the earnings report, closing 4.2% higher at $11.56 before hitting their highest since November.Snap CEO Evan Spiegel said in a statement announcing the results:
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