Snap Inc. (NYSE: SNAP) made a splash with its Q1 2024 earnings report released on April 25th, showcasing impressive financial results that exceeded market expectations. The tech giant reported a significant revenue increase of 21% year-over-year, reaching $1.19 billion, outpacing analyst estimates. This robust growth propelled Snap’s shares to surge by over 23% in after-hours trading.
Key highlights from Snap’s first-quarter performance include:
- Earnings and Revenue Beat: Snap surpassed analyst estimates for both earnings and revenue, reporting adjusted earnings per share of 3 cents compared to an expected loss of 5 cents. Revenue for the quarter stood at $1.19 billion, exceeding the anticipated $1.12 billion.
- Strong User Growth: The company reported a notable increase in daily active users (DAUs), reaching 422 million, up by 10% year-over-year. This growth underscores Snap’s continued success in expanding and engaging its user base.
- Advertising Platform Enhancements: Snap attributed its revenue growth to improvements in its advertising platform, alongside strong demand for its direct-response advertising solutions. Advertising revenue amounted to $1.11 billion for the quarter, reflecting a thriving advertising ecosystem.
- Snapchat+ Subscribers Surge: The number of Snapchat+ subscribers more than tripled year-over-year, surpassing 9 million subscribers in Q1. This surge in subscribers contributed to Snap’s revenue diversification and growth strategy.
- Adjusted EBITDA Exceeds Expectations: Snap’s adjusted EBITDA for the quarter reached $46 million, surpassing analyst expectations by a significant margin. This performance was primarily driven by disciplined operating expense management and accelerating revenue growth.
- Outlook for Q2 2024: As Snap enters the second quarter of 2024, it anticipates further growth in its global community, projecting approximately 431 million DAUs. Revenue guidance for Q2 ranges between $1.225 billion and $1.255 billion, implying a year-over-year growth of 15% to 18%.
While the stock is all set to open up by nearly 24% at $14.12. In the daily charts, we can see that Snap saw an aggressive bullish move between October 2023 and February 2024. However, this bullish move came to a sudden end on February 7 after the company reported its Q42023 numbers.
Since then, the stock has mostly traded in a range between $10 and $12.5. Now, with today’s move, what remains to be seen is whether the stock can break above the $15.2 mark, which acted as a support for it between December 2023 and its Q4 results and which now acts as a resistance.
Traders, who want to take a fresh long position in the stock are advised to do so only if it crosses above $15.2, in which case, one can stock to move higher to first $18 and then $20.8.
Traders who continue to remain bearish on stock can take a fresh short position at the opening today with a stop loss a few cents above $15.2. If the stock starts falling one can keep the first profit target at $12.5 and the second profit target at $10.2
The post Snap's Q1 earnings beat sends stock soaring 24% pre-market appeared first on Invezz
