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SNAP Gearing Up to Report Q2 Earnings: What's in the Cards?
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Snap (SNAP - Free Report) is set to report second-quarter 2022 results on Jul 21.
On May 23, Snap filed an 8-K stating that the macroeconomic environment has deteriorated further and faster than anticipated. As a result, Snap will likely report revenues and adjusted EBITDA below the low end of its second-quarter 2022 guidance range.
On the last-reported quarter earnings call, Snap had guided revenues to be between 20% and 25% for the second quarter of 2022. The company estimated adjusted EBITDA to be between breakeven and $50 million.
The Zacks Consensus Estimate for revenues is currently pegged at $1.14 billion, indicating 16.18% growth from the year-ago quarter’s reported figure.
The consensus mark for the bottom line has been steady at a loss of 1 cent per share in the past 60 days, indicating a decline of 110% year over year.
Let’s see how things have shaped up for the upcoming announcement.
Snap has been benefiting from a spike in the usage of Snapchat. The growing adoption of Snapchat among the Gen Z (13-24 years) population is expected to have driven DAUs, thus expanding the company’s advertiser base.
In the first quarter, Snapchat’s subscriber growth, reflected by Daily Active Users (DAUs), increased 52 million on a year-over-year basis. DAUs at the end of the first quarter were 322 million, up 18% year over year.
The Zacks Consensus Estimate for second-quarter global DAUs is currently pegged at 341 million, indicating growth of 16.4% from the year-ago quarter level.
SNAP is focused on continuously adding innovative features like Lens Studio 2.0, Camera Kit, Snap Minis and Bitmoji for Games, making Snapchat more attractive for users and advertisers.
On May 25, Snap introduced its Shared Stories feature for Snapchat users. Shared Stories, a new iteration of Custom Stories, is anticipated to be a novel way for Snapchatters to build a community around the content they love
With these recent launches, Snap is democratizing its augmented reality (AR) tools that are likely to drive user growth.
On May 20, Snap launched four new AR lenses at Electric Daisy Carnival, Las Vegas, as part of its Live Nation partnership. The AR Lenses have been produced with the help of Snap’s AR creative studio, Arcadia. Initiatives like these are expected to boost user engagement and user base growth.
In the to-be-reported quarter, Snap launched an AR exhibition, curated by Edward Enninful OBE, in partnership with Vogue, called Vogue x Snapchat: Redefining the Body. The exhibition illustrates how physical fashion designs can be enhanced and transformed through innovative digital experiences and custom Snapchat Lenses.
Snap also announced bringing 185 years of the House of Tiffany, in partnership with Tiffany and CO., and the launch of its exhibition, Vision & Virtuosity, at Saatchi Gallery in London, into a new dimension, using Snap AR.
In addition to the strong adoption of AR Lenses, the Discover content and Shows are expected to have driven user growth. In the last reported quarter, six Discover partners reached more than 100 million global viewers each.
On May 4, Snap announced expanded multi-year content deals with the NFL, WNBA, and NBA. The three sports leagues will continue their collaboration with Snap, providing their current shows on Discover, including Highlight Shows as well as bringing new AR experiences and content to Spotlight.
The growing Snap Originals content is also expected to have bolstered user engagement. In May, Snap announced a series of new Snap Originals, including Daring Simon Biles, Reclaim (ed), Run for Office, and La’Ron in a Million.
With more than 150 Snap Originals to date and more than 80% of the US Gen Z Population watching a Snap Original last year, the company has renewed two of its hit Snap Originals — Dixie and Charli D’Ameli and The Me and You Show, which garnered more than 20 million and 50 million viewers, respectively.
In the last reported quarter, the company announced multi-year renewals of global content deal with Disney (DIS - Free Report) , Comcast’s (CMCSA - Free Report) NBCUniversal and Paramount Global (PARA - Free Report) , encompassing a range of new shows coming to Snapchat.
The three big media companies will continue collaborating with Snap through the extended agreements.
Disney, Comcast-owned NBCUniversal and Paramount Global will continue to provide their current content on Snapchat’s Discover. The companies, individually, plan to bring more shows to the platform in the future.
The Zacks Consensus Estimate for Snap’s second-quarter ARPU is pegged at $3.57, suggesting an increase of 6.6% from the year-ago quarter’s reported figure.
A steady ad-spending environment is expected to reflect on Snap’s second-quarter top line numbers. Advertising has been the only source of revenues for Snap, which has been facing significant competition from the likes of Twitter, Facebook and Google, for ad dollars. A persistent decline in price-per-ad impression is likely to have dented advertising revenues for this Zacks Rank #4 (Sell) company.
Image: Bigstock
SNAP Gearing Up to Report Q2 Earnings: What's in the Cards?
Snap (SNAP - Free Report) is set to report second-quarter 2022 results on Jul 21.
On May 23, Snap filed an 8-K stating that the macroeconomic environment has deteriorated further and faster than anticipated. As a result, Snap will likely report revenues and adjusted EBITDA below the low end of its second-quarter 2022 guidance range.
On the last-reported quarter earnings call, Snap had guided revenues to be between 20% and 25% for the second quarter of 2022. The company estimated adjusted EBITDA to be between breakeven and $50 million.
The Zacks Consensus Estimate for revenues is currently pegged at $1.14 billion, indicating 16.18% growth from the year-ago quarter’s reported figure.
The consensus mark for the bottom line has been steady at a loss of 1 cent per share in the past 60 days, indicating a decline of 110% year over year.
Let’s see how things have shaped up for the upcoming announcement.
Snap Inc. Price and Consensus
Snap Inc. price-consensus-chart | Snap Inc. Quote
Factors to Consider
Snap has been benefiting from a spike in the usage of Snapchat. The growing adoption of Snapchat among the Gen Z (13-24 years) population is expected to have driven DAUs, thus expanding the company’s advertiser base.
In the first quarter, Snapchat’s subscriber growth, reflected by Daily Active Users (DAUs), increased 52 million on a year-over-year basis. DAUs at the end of the first quarter were 322 million, up 18% year over year.
The Zacks Consensus Estimate for second-quarter global DAUs is currently pegged at 341 million, indicating growth of 16.4% from the year-ago quarter level.
SNAP is focused on continuously adding innovative features like Lens Studio 2.0, Camera Kit, Snap Minis and Bitmoji for Games, making Snapchat more attractive for users and advertisers.
On May 25, Snap introduced its Shared Stories feature for Snapchat users. Shared Stories, a new iteration of Custom Stories, is anticipated to be a novel way for Snapchatters to build a community around the content they love
With these recent launches, Snap is democratizing its augmented reality (AR) tools that are likely to drive user growth.
On May 20, Snap launched four new AR lenses at Electric Daisy Carnival, Las Vegas, as part of its Live Nation partnership. The AR Lenses have been produced with the help of Snap’s AR creative studio, Arcadia. Initiatives like these are expected to boost user engagement and user base growth.
In the to-be-reported quarter, Snap launched an AR exhibition, curated by Edward Enninful OBE, in partnership with Vogue, called Vogue x Snapchat: Redefining the Body. The exhibition illustrates how physical fashion designs can be enhanced and transformed through innovative digital experiences and custom Snapchat Lenses.
Snap also announced bringing 185 years of the House of Tiffany, in partnership with Tiffany and CO., and the launch of its exhibition, Vision & Virtuosity, at Saatchi Gallery in London, into a new dimension, using Snap AR.
In addition to the strong adoption of AR Lenses, the Discover content and Shows are expected to have driven user growth. In the last reported quarter, six Discover partners reached more than 100 million global viewers each.
On May 4, Snap announced expanded multi-year content deals with the NFL, WNBA, and NBA. The three sports leagues will continue their collaboration with Snap, providing their current shows on Discover, including Highlight Shows as well as bringing new AR experiences and content to Spotlight.
The growing Snap Originals content is also expected to have bolstered user engagement. In May, Snap announced a series of new Snap Originals, including Daring Simon Biles, Reclaim (ed), Run for Office, and La’Ron in a Million.
With more than 150 Snap Originals to date and more than 80% of the US Gen Z Population watching a Snap Original last year, the company has renewed two of its hit Snap Originals — Dixie and Charli D’Ameli and The Me and You Show, which garnered more than 20 million and 50 million viewers, respectively.
In the last reported quarter, the company announced multi-year renewals of global content deal with Disney (DIS - Free Report) , Comcast’s (CMCSA - Free Report) NBCUniversal and Paramount Global (PARA - Free Report) , encompassing a range of new shows coming to Snapchat.
The three big media companies will continue collaborating with Snap through the extended agreements.
Disney, Comcast-owned NBCUniversal and Paramount Global will continue to provide their current content on Snapchat’s Discover. The companies, individually, plan to bring more shows to the platform in the future.
The Zacks Consensus Estimate for Snap’s second-quarter ARPU is pegged at $3.57, suggesting an increase of 6.6% from the year-ago quarter’s reported figure.
A steady ad-spending environment is expected to reflect on Snap’s second-quarter top line numbers. Advertising has been the only source of revenues for Snap, which has been facing significant competition from the likes of Twitter, Facebook and Google, for ad dollars. A persistent decline in price-per-ad impression is likely to have dented advertising revenues for this Zacks Rank #4 (Sell) company.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.