Snap Q3 2024 Earnings Report

Snap reported better-than-expected third-quarter results on Tuesday but gave weak guidance for the fourth quarter. The stock rose more than 10% in extended trading.

This is how the company did it:

• Earnings per share: 8 cents adjusted versus 5 cents expected, according to LSEG
• Revenue: $1.37 billion versus $1.36 billion expected, according to LSEG
• Global Daily Active Users: According to StreetAccount it is 443 million compared to expected 441 million
• Global average revenue per user: According to StreetAccount, $3.10 versus expected $3.09

Revenue rose 15% year over year in the third quarter, while Snap's net loss narrowed to $153 million from $368 million a year earlier.

Fourth-quarter revenue will be between $1.51 billion and $1.56 billion. The median forecast is $1.54 billion, below the average analyst estimate of $1.56 billion. Snap said its fourth-quarter adjusted profit would be between $210 million and $260 million. The middle of the range is above analyst estimates of $230.7 million.

Snap also announced a $500 million share repurchase program.

The company said the number of paying Snapchat+ subscribers is now 12 million. That's an increase from the 11 million reported in August. The company launched its subscription service in 2022, offering users the opportunity to experience exclusive features and early releases for $3.99 per month.

“Our investments in AI and AR are enabling new creative experiences for our community and driving innovation across our advertising platform, underpinning our long-term growth opportunities,” Snap CEO Evan Spiegel said in a statement.

In September, Snap introduced the fifth generation of its Spectacles augmented reality glasses, which allow people to see digital images connected to the physical world. The new Spectacles are only available to developers, who must pay $99 per month for a year if they want to build AR apps for the glasses.

Shortly after Snap announced the new Spectacles, Meta CEO Mark Zuckerberg introduced his company's experimental AR glasses called Orion. Meta's Orion AR glasses have generated excitement among employees, and the company plans to recruit developers next year to eventually bring them to market.

In a letter to investors, Snap discussed the importance that developers play in the company's Spectacles and AR initiatives.

“We strive to be the most developer-friendly platform in the world, and we are excited to offer our new generation of Spectacles to developers as an invitation and inspiration for creating new experiences,” Snap said in the letter.

Before the after-market rally, Snap shares were down 36% for the year, while the Nasdaq was up 25%.