![]() The company said six Discover media partners reached over 100 million global viewers each in the quarter (it didn’t identify them) and that more than 10 million viewers have watched “Breakwater,” its new original series about a dystopian future caused by climate change that featured episodic AR Lenses sponsored by Verizon. On the content front, Snap reported that total time spent with Spotlight, its TikTok-style user generated content section, grew 230% year-over-year in Q1. Andersen told analysts Snapchat average DAUs are expected to come in around 343 million-345 million in Q2. For the second quarter, Snap expects revenue growth to be between 20% and 25% with adjusted EBITDA forecast to be between breakeven and $50 million. Snap had reported its first-ever net profit for Q4 2021, managing to earn $22.6 million after years of red ink. On the call, chief business officer Jeremi Gorman said, “We continued to work through platform policy changes, which are primarily impacting direct-response advertising partners.” He added that “we are concerned that the operating environment ahead could be even more challenging, leading to further campaign pauses or advertiser budget reductions.”Īlso cramping Snap revenue was the ongoing impact of Apple’s iOS privacy update that requires double opt-in from users to allow ad tracking. Macroeconomic headwinds that caused the revenue declaration in Q1 included “supply chain disruptions, labor shortages, inflationary pressures and the impact of rising interest rates” - which “remain challenges as we enter Q2,” Andersen said. Snap saw a “broad-based” slowdown in the rate of ad sales growth during Q1 after Russia’s invasion of Ukraine, Andersen said. “While we are pleased with our progress given the macroeconomic environment, we also recognize that we have a significant amount of work to do to realize our long-term opportunity, and we believe we are well positioned to invest through the turbulence,” he told investors. Spiegel, on the earnings call, touted Snap’s free cash flow of $106 million for Q1, marking its third quarter of positive free cash flow. Shares closed down 4.4% in regular trading and have declined 37% year-to-date. Snap’s stock swung between positive and negative territory in after-hours trading Thursday, eventually landing between +1% and -1%. Excluding that, net income would have improved by 7%, or $19 million, to negative $267 million, CFO Derek Andersen said on the earnings call. The Q1 net loss included a $92 million unrealized loss on Snap’s investment in an unidentified company that went public in 2021. Wall Street analysts on average had expected Snap to post revenue of $1.07 billion and adjusted EPS of 1 cent, per financial data provider Refinitiv. The company reported an adjusted net loss of 2 cents per share. Net loss came in at $360 million, an increase of 25% compared with $287 million in the prior-year quarter. “The first quarter of 2022 proved more challenging than we had expected, and our team was able to make significant progress against our goals despite increased volatility in the operating environment,” Spiegel said in prepared remarks.įor Q1, Snap’s revenue rose 38% to $1.063 billion, versus 66% growth in the year-ago quarter. ![]() "While the continued growth of our community increases the long-term opportunity for our business, our financial results for Q2 do not reflect our ambition," Snap CEO Evan Spiegel said in a statement.Click here to sign up for Variety’s free Strictly Business newsletter covering earnings, financial news, and more. Net losses deepened to $422 million in the quarter, from $152 million in 2021. This marked a 13% improvement on the same quarter of 2021, but fell short of the consensus forecast of $1.14 billion, which is based on analyst estimates. The company reported revenue of $1.11 billion in the three months to June. It also did not provide any guidance for the upcoming quarters, as it said "forward-looking visibility remains incredibly challenging." Snap, which owns Snapchat, said it planned to slow hiring and expected slower revenue growth. Goldman Sachs slashed its forecasts after the disappointing performance. Snap shares plunged by as much as 36% in Friday's pre-market following the social-media company's second-quarter earnings, which showed a slump in advertising revenue hitting its bottom line.
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