Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Snap misses quarterly revenue estimates, shares sink

TechnologyFeb 04, 2020 07:13PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

By Sheila Dang and Amal S

(Reuters) - Snap Inc (N:SNAP) missed Wall Street estimates for fourth quarter revenue on Tuesday as it faced tough competition from digital advertising giants Google and Facebook, sending its shares down 10%.

Snap, which owns the popular photo messaging app Snapchat, had earlier warned its peak advertising demand period between Black Friday and the December holidays had one fewer week this year.

Revenue, which the company generates from selling advertising on Snapchat, rose 44% to $560.88 million but missed the average analyst estimate of $563.03 million.

While Snap has invested in a self-serve platform to make it easier for advertisers to buy ad space, it is still a long way from stealing ad dollars from Alphabet Inc's (O:GOOGL) Google and Facebook (O:FB), which command a huge portion of the digital advertising market.

Snapchat has only 0.5% of worldwide digital ad revenue, while Facebook accounts for 21.1%, according to a report by market researcher eMarketer.

Snap said daily active users (DAU) on Snapchat rose 4% to 218 million in the three months ended Dec. 31 from the prior quarter.

The user metric stood at 186 million a year earlier.

Snapchat rose to fame with its photo lens filters that can overlay things like dog ears on a user's face and has added mobile games and original shows to keep its audience on the app.

Snapchat's DAU, a widely watched metric by investors and advertisers, was above analysts' average estimate of 215.04 million, according to IBES data from Refinitiv.

Average revenue per user jumped 23% to $2.58 during the quarter from a year earlier.

Snap is focusing on growing the total number of advertisers on Snapchat as well as diversifying the types of advertisers it works with, said Jeremi Gorman, Snap's chief business officer, on an earnings call with analysts.

Snap's net loss widened to $240.7 million, or 17 cents per share, from $191.67 million, or 14 cents per share, a year earlier.

The company expects first-quarter revenue in the range of $450 million to $470 million. Analysts on average were expecting $461.6 million.

"Given the substantial long-term opportunities ahead, we are working hard to scale our revenue so that we are able to self-fund our investments in the future," Chief Executive Officer Evan Spiegel said during the call.

Shares of Snap were down 10% to $17.09 in trading after the bell.

Snap misses quarterly revenue estimates, shares sink
 

Related Articles

Global automakers face electric shock in China
Global automakers face electric shock in China By Reuters - May 25, 2022

By Norihiko Shirouzu BEIJING (Reuters) - If global automakers think they can extend their dominance in China into the electric era, they may be in for a shock. Kings of the...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email