Snapchat thinks it can beat Instagram, stock climbs on the promise

Snapchat Snapchat user base Snap Share Snap Inc Snapchat results Snap results Snap Inc Q4 results Snap revenue Snapchat revenue

Snapchat Snapchat user base Snap Share Snap Inc Snapchat results Snap results Snap Inc Q4 results Snap revenue Snapchat revenue

Although Snap posted a net loss of $350 million, quarterly revenue still reached $285.7 million - up 72% year-over-year. As has been the case recently with companies that have beat Wall Street estimates, shares soared as soon as the news came out. In fact, ad spend through 4C increased 29% in Q4 to close out the first full year of self-serve Snap Ads.

Snap Inc surprised Wall Street on Tuesday with a rebound in user growth for its Snapchat messaging app, showing resilience amid competition with Facebook Inc's Instagram and sending shares up almost 30 per cent. Wall Street expected Snap to add about 6 million daily users during the quarter.

While Snapchat has always been considered popular among younger users, the service must prove it can also appeal to users in older demographics in order to drive further growth and appease advertisers looking to reach users with more spending power. Those bets appear to be paying off. The firm now has a $16.00 price objective on the stock.

Barclay analysts expect the Snap's stock to continue sloping upward "as the narrative changes from 2017's '[Facebook] is going to crush SNAP" to 2018's "users and revenue accelerate and the platform is under-monetized". The company's stock chart Tuesday afternoon looked similar to the trajectory of Elon Musk's SpaceX rocket, launched into outer space just minutes before Snap reported - straight up.

In a rare show of humility for Snapchat, the app recently made a decision to let users share their Stories on Facebook and Twitter.

Snapchat Snapchat user base Snap Share Snap Inc Snapchat results Snap results Snap Inc Q4 results Snap revenue Snapchat revenue
Confidence that the two could coexist in the social media sector was shaken when Snapchat’s user growth stalled last year

EPS/Net loss (adjusted): ($0.13) vs. ($0.16) expected.

On a call with investors, Snap CEO Evan Spiegel said the company plans to slow down its hiring.

As a result, in the fourth quarter of 2017, Snapchat's daily audience expanded by 18 percent year over year to 187 million people, and the 8.9 million new users added in the period marked the most since Q3 2016, when Facebook-owned Instagram copied Snapchat's Stories feature. The change is supposed to make Snapchat more appealing to a broader audience, but it's unclear if that will be the result, he said.

Wieser also anxious about Snap's high expenses and costs, and the firm's corporate governance.

Snap's first year as a public company has been marked by hurdles, including the loss of its heads of product and engineering. More importantly, we increased advertising impressions by over 4x year-over-year while continuing to grow per user engagement. A major driving factor in the wave of new users, according to Spiegel, is the app's redesign that prioritizes social features like messages and Stories from friends over ads and other professionally produced content housed in the Discover section. Although Snapchat's redesign at the end of previous year took a step in the right direction, Socialbakers insists that the platform is still limited and is yet to leverage its full potential.

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