Latest news with #Snapchat+
RTÉ News
4 days ago
- Business
- RTÉ News
Snap's revenue growth slowest in over a year as competition, ad platform glitch hurt
Snap has reported its slowest quarterly growth in more than a year, hurt by a temporary glitch in its ad platform and advertiser preference for bigger rivals such as Meta, sending its shares down over 16% in extended trading. The Snapchat-parent said it had resolved the error that unintentionally allowed some ads to run at much lower prices. Snap faces tough competition from the likes of TikTok and Meta-owned Facebook and Instagram, with advertisers preferring the larger platforms as they curtail marketing budgets amid economic uncertainty. Rivals Meta and Reddit reported upbeatsecond quarter results last week. "The digital ad tailwinds that propelled Meta and Reddit to blowout quarters turned into a light breeze for Snap," said eMarketer principal analyst Jasmine Enberg. Under different circumstances, investors might have overlooked its ad platform misstep, but "there is little room for mistakes," she added. Snap's quarterly revenue was also impacted by the timing of Ramadan, which influenced ad spending patterns. The end of the "de minimis" exemption - a US duty-free import provision - also prompted some Chinese advertisers to reduce their marketing budgets. In April, ad revenue declined about 1% before "largely recovering" through May, and triggering the company to roll out Sponsored Snaps - a new video ads format that appears in user inboxes - more broadly in June, said CFO Derek Andersen. The company said its expanded roll-out of Sponsored Snaps across the US and several other global regions is driving more user actions and deeper engagement with ad content. The Santa Monica, California-based company reported second-quarter revenue of $1.34 billion, up around 8.7% from last year and largely in line with estimates, but lower than the double-digit growth it recorded in the last five quarters. Its net loss widened to $263 million from $249 million a year ago. Small and medium-sized businesses were the largest contributors to ad revenue growth and its subscription service Snapchat+ remained a key driver for diversifying revenue beyond ads. Snapchat+ subscribers rose 42% to nearly 16 million for the quarter ended June 30. Daily active users rose 9% to 469 million, compared with estimates of 467.9 million. The company forecast third-quarter revenue between $1.48 billion and $1.51 billion, compared with analysts' average estimate of $1.48 billion, according to data compiled by LSEG.
The Hindu
5 days ago
- Business
- The Hindu
Snap's revenue growth slowest in over a year as competition, ad platform glitch hurt
Snap on Tuesday reported its slowest quarterly growth in more than a year, hurt by a temporary glitch in its ad platform and advertiser preference for bigger rivals such as Meta, sending its shares down over 16% in extended trading. The Snapchat-parent said it had resolved the error that unintentionally allowed some ads to run at much lower prices. Snap faces tough competition from the likes of TikTok and Meta-owned Facebook and Instagram, with advertisers preferring the larger platforms as they curtail marketing budgets amid economic uncertainty. Rivals Meta and Reddit reported upbeat second quarter results last week. "The digital ad tailwinds that propelled Meta and Reddit to blowout quarters turned into a light breeze for Snap," said eMarketer principal analyst Jasmine Enberg. Under different circumstances, investors might have overlooked its ad platform misstep, but "there is little room for mistakes," she added. Snap's quarterly revenue was also impacted by the timing of Ramadan, which influenced ad spending patterns. The end of the "de minimis" exemption, a U.S. duty-free import provision, also prompted some Chinese advertisers to reduce their marketing budgets. In April, ad revenue declined about 1% before "largely recovering" through May, and triggering the company to roll out Sponsored Snaps, a new video ads format that appears in user inboxes, more broadly in June, said CFO Derek Andersen. The company said its expanded roll-out of Sponsored Snaps across the U.S. and several other global regions is driving more user actions and deeper engagement with ad content. The Santa Monica, California-based company reported second-quarter revenue of $1.34 billion, up around 8.7% from last year and largely in line with estimates, but lower than the double-digit growth it recorded in the last five quarters. Its net loss widened to $263 million from $249 million a year ago. Small and medium-sized businesses were the largest contributors to ad revenue growth and its subscription service Snapchat+ remained a key driver for diversifying revenue beyond ads. Snapchat+ subscribers rose 42% to nearly 16 million for the quarter ended June 30. Daily active users rose 9% to 469 million, compared with estimates of 467.9 million. The company forecast third-quarter revenue between $1.48 billion and $1.51 billion, compared with analysts' average estimate of $1.48 billion, according to data compiled by LSEG.
The Star
5 days ago
- Business
- The Star
Snap records slowest revenue growth in over a year amid tough competition for ads
FILE PHOTO: Snapchat logo is seen in this illustration taken July 28, 2022. REUTERS/Dado Ruvic/Illustration/File Photo (Corrects paragraph 4 to say revenue rose 8.7%, not 8.1%, in the second quarter) (Reuters) -Snap on Tuesday reported second-quarter revenue growth that was the slowest in more than a year, a sign of growing competition from bigger social media rivals including Meta. Shares of the Snapchat parent slumped 15% after the bell following the results. The company's results came after stellar performances by rivals, including Instagram and Facebook parent Meta Platforms and Reddit. The Snapchat-parent's second-quarter revenue rose 8.7% to $1.34 billion, largely inline with estimates. The quarterly revenue was hit by changes to its ad platform, the timing of Ramadan and the termination of de minimis exemption or a duty-free import loophole in the U.S. The company said it had reverted the ad platform change that unintentionally allowed some ads run at much lower prices, hurting revenue growth in the reported quarter. Snap said its expanded roll-out of the new ad format — Sponsored Snaps, video ads that appear in user inboxes — across the U.S. and several other global regions is helping by driving more user actions and deeper engagement with ad content. Small and medium-sized businesses were the largest contributors to ad revenue growth and its subscription service Snapchat+ remained a key driver for diversifying revenue beyond advertising. Snapchat+ subscribers rose 42% to nearly 16 million for the quarter ended June 30. Daily active users rose 9% to 469 million, compared with estimates of 467.9 million. The company forecast third-quarter revenue between $1.48 billion and $1.51 billion, compared with analysts' average estimate of $1.48 billion, according to data compiled by LSEG. It expects quarterly adjusted earnings before interest, taxes, depreciation, and amortization to be between $110 million and $135 million, above estimates of $111.9 million. For the second quarter, the company's net loss widened to $263 million from $249 million a year ago. (Reporting by Jaspreet Singh in Bengaluru; Editing by Leroy Leo)
CNBC
5 days ago
- Business
- CNBC
Snap just reported second-quarter earnings
Snap reported second-quarter earnings on Tuesday in which sales were basically in line with analysts' estimates while its global average revenue per user missed expectations. Here is how the company did compared with Wall Street's expectations: Snap said its second-quarter sales grew 9% year over year while it recorded a net loss of $262.6 million. The company's net loss during the same quarter last year was $248.6 million. Adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, for the second quarter came in at $41 million, trailing the $53 million that StreetAccount was projecting. Snap said third-quarter revenue will come in between $1.475 billion and $1.505 billion, ahead of Wall Street estimates of $1.475 billion. The company said adjusted EBITDA for the third quarter will be in the range between $110 million and $135 million. That figure's midpoint of $122.5 million is higher than StreetAccount's projections of $116 million. Snap said third-quarter global daily active users will total 476 million, roughly in line with the 475.7 million StreetAccount is expecting. The company's Snapchat+ subscription service is approaching 16 million in the second quarter, representing a 42% year-over-year increase, Snap CEO Evan Spiegel wrote in an investor letter. Snap's subscription service is the "largest driver" to the company's Other Revenue category, rising 64% year over year to $171 million in the second quarter, Spiegel said. Snap's adjusted operating expenses for the second quarter rose 10% year over year to $654 million, Spiegel said in the letter. Spiegel said in an investor letter that it will be "distributing" its engineering teams to "directly support" its business functions, resulting in its core applications team reporting to tech chief Bobby Murphy. The monetization engineering team will be reporting to business chief Ajit Mohan. "Our Chief Information Officer and Chief Information Security Officer will report to me and lead enterprise-wide foundational infrastructure and platform integrity," Spiegel said in the letter. "This new, distributed structure will empower our teams to take greater ownership and drive continued innovation for our community and advertising partners." Eric Young, Snap's senior vice president of engineering who joined the social media company in 2023 from Google, is leaving the company to "pursue a new opportunity," Spiegel said in the letter. Last Thursday, Amazon reported second-quarter earnings in which its online ad sales rose 23% year over year to $15.69 billion, while Reddit reported second-quarter revenue that jumped 78% year over year to $500 million. Alphabet reported its second-quarter earnings on July 23 that beat on the top and bottom lines. Meta said on July 30 that its second-quarter sales grew 22% year over year to $47.52 billion. Pinterest will report its financials on Thursday.
Yahoo
7 days ago
- Business
- Yahoo
Meta, X and Snapchat Offer Discounts on Paid Subscription Packages for Summer
This story was originally published on Social Media Today. To receive daily news and insights, subscribe to our free daily Social Media Today newsletter. Meta, X and Snaochat are all making a push on their premium add-on plans for the Summer, with each offering special discounts for sign-ups over the next month. Meta's offering a significant discount for initial sign-ups, with the first month available super cheap, before rising back to its normal levels. As you can see in this example, posted by Jonah Manzano, Meta's looking to entice a few more Verified sign-ups through a big discount on the initial few weeks (note: dollars here are in AUD). X Premium, meanwhile, is offering 30% off its annual subscriptions for its Premium and Premium Plus plans. While Snapchat is also offering a 50% discount off the price of the first two months of Snapchat+ as well. Will that help to boost their subscription offerings, and make them a more significant revenue stream for each company? Maybe, though I wouldn't bet on it, as most people who would sign-up for each has likely already done so, and there's not a heap of add-on content that's sweetened the deal in recent months. I mean, X is offering expanded access to its latest Grok AI tools, and that could be enticing for some people. Snap is also offering advanced access to new features to enhance the Snap experience. But none of these is going to become a major revenue driver for any of these companies, with all of these elements only contributing a minor amount, in terms of overall revenue. Though each is still a significant income stream in itself. We don't have exact data, because the platforms generally keep that to themselves, but looking at its performance reports, Meta's added an extra $358 million to its 'Other' income stream on what it was earning in this category when it launched Meta Verified back in Q2 2023. Using the average price of Meta Verified as a measuring stick ($13), that would suggest that Meta could have sold around 9 million subscriptions to Meta Verified thus far. Which is a lot, to be sure, and a lot of money to be bringing in each month from the offering. But in comparison to the $31.5 billion it generates per quarter from ads, it's clearly a subsidiary revenue element. Snapchat+ is now up to 15 million subscribers, which has brought an extra $150 million per quarter into its coffers, and made it the most successful add-on offering of the new three. Though again, it's still nowhere close to the $1.36 billion overall that Snap brought in for Q1. Which brings us to X, which has been the most scrutinized and criticized of the three new paid add-on offerings. That's because X owner Elon Musk was originally hoping to get hundreds of millions of people to pay for X access, which would then enable him to supplant advertiser dollars, and thus advertiser restrictions on content, as he mapped a way forward for the app. But it hasn't exactly worked out that way. X Premium looks to currently have around 1.5 million paying users, which equates to less than 0.5% of X's user base. So not close to the 300 million or so subscribers that X was hoping for, though it still seemingly believes that access to its Grok AI chatbot will eventually drive up subscription revenue. Though the expense of developing xAI has also forced it to increase X Premium prices. And with AI bots available from OpenAI and Meta, I'm not sure it's ever going to be the lure that Elon and Co. hope. But maybe, with this new promotional push, each platform can make their subscription add-ons a bigger factor, and get more people at least trying out their offerings. But overall, the numbers show that subscription options are never going to supplant advertising as the key funding path for social apps. Which means that Elon's stuck playing along with advertiser demands, and X is stuck looking to boost its user base to maximize advertiser interest. And while each offering does provide a valuable additional income stream, none looks set to see any huge increase in its current take-up, unless they really catch on in developing regions. Recommended Reading Social Platforms Are Running Disruptive Promotions for Their Own Products Sign in to access your portfolio
