Earnings

October 21, 2021

Snap’s Earnings 💀 (GONE WRONG) (REAL) (SHOCKING)

Snap posted its latest quarter’s earnings today and needless to say, it could’ve gone better. 🤦 Over $25 billion of the company’s value was wiped out in the minutes after its earnings release dropped. 

The company posted EPS of $0.17 (analysts expected $0.08) and revenue of $1.07 billion (analysts expected $1.10 billion.) The company’s quarterly revenues were up 57% YoY. The company’s daily active users also grew, up 23% YoY.

Besides the small miss on revenue, this earnings report was acceptable… until investors scrolled down to the part detailing guidance for future quarters. That’s where everything went south. 💀

The company said that it expects Q4 revenue to be between $1.16 billion and $1.2 billion. Those figures represent pitiful growth compared to recent quarters. Snap CEO Evan Spiegel faulted Apple’s new privacy changes for the lost revenue, indicating that it made it “more difficult for .. advertising partners to measure and manage their ad campaigns for iOS.”

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The fears about Apple’s new privacy changes boiled over to other social media companies like Facebook (-5%) and Twitter(-5%), which fell in sympathy with Snap on the news.

Before today, Snap traded at 200x earnings for FY 2021. Given those astronomical multiples, the small revenue miss and unfortunate outlook added up to one big loss for the company. 💩

$SNAP fell 21% in AH. Spooky. 🎃

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