This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. Snap Stock Surges on Earnings and New Perplexity Deal By Adam Levine Updated Nov 05, 2025, 9:38 pm EST / Original Nov 05, 2025, 6:51 pm EST Share Resize Reprints In this article SNAP Shares of Snapchat parent Snap soared 15 ...

Core Viewpoint - Snap's stock surged over 16.4% after the release of its Q3 earnings, indicating positive market reaction to the results and future outlook [1] Financial Performance - Q3 revenue increased by 10% year-over-year to $1.5 billion, surpassing market expectations of $1.49 billion [1] - Net loss narrowed to $104 million, translating to a loss of $0.06 per share [1] - Global daily active users reached 477 million, exceeding the forecast of 476 million [1] - Average revenue per user (ARPU) was $3.16, slightly above the expected $3.13 [1] Future Outlook - The company anticipates Q4 revenue to be between $1.68 billion and $1.71 billion, with the midpoint slightly above the market expectation of $1.69 billion [1] - Snap announced a $400 million partnership with AI startup Perplexity, with plans to integrate Perplexity's AI search engine into the Snapchat app starting in 2026 [1]

Core Insights - Snap Inc. has announced a partnership with Perplexity AI Inc. valued at up to $400 million, integrating AI-driven search capabilities into Snapchat, which is expected to create a new growth avenue for the company [1][2] - Following the announcement and a better-than-expected earnings report, Snap's stock surged over 25% in after-hours trading [1][2] Financial Performance - Snap reported Q3 revenue of approximately $1.51 billion, reflecting a year-over-year growth of about 10%, slightly above Wall Street's expectations of around $1.49 billion [2] - The company anticipates Q4 revenue to be between $1.68 billion and $1.71 billion, aligning with analyst expectations of approximately $1.69 billion [2] User Growth and Engagement - Snapchat's daily active users reached 477 million in Q3, representing an 8% year-over-year increase, while monthly active users approached 943 million [3] - The company aims to reach a target of 1 billion monthly active users [3] Advertising Business - Snap's advertising revenue for Q3 was $1.32 billion, showing a year-over-year increase of about 5%, despite previous challenges [3] - The company is focusing on small to medium-sized advertisers and has introduced new ad formats to drive growth [4] Subscription Services - Snap's subscription service, Snapchat+, has nearly 17 million paying users, contributing significantly to the company's revenue diversification [5] - The "Other Revenue" category, which includes Snapchat+, generated approximately $190 million in Q3, marking a substantial year-over-year growth of 54% [6] Regulatory Challenges - Snap has warned that user engagement may decline due to regulatory changes, such as the upcoming social media age restrictions in Australia [6]

Group 1 - The article discusses the importance of enabling Javascript and cookies in browsers to prevent access issues [1] - It highlights that users with ad-blockers may face restrictions when trying to access content [1]

Core Insights - Snap reported $1.51 billion in revenue for Q3 2025, a year-over-year increase of 9.8%, with an EPS of $0.06 compared to $0.08 a year ago, aligning with the Zacks Consensus Estimate of $1.49 billion, resulting in a surprise of +0.97% [1] Financial Performance - The company has not delivered an EPS surprise, as the consensus EPS estimate was $0.06 [1] - Snap's shares have returned -8.1% over the past month, while the Zacks S&P 500 composite increased by +1% [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance against the broader market in the near term [3] Key Metrics - Total Daily Active Users (DAU) reached 477 million, slightly above the average estimate of 476.46 million [4] - Average Revenue Per User (ARPU) globally was $3.16, exceeding the estimated $3.14 [4] - DAU in North America was 98 million, matching the estimate [4] - DAU in Europe was 100 million, slightly below the estimate of 101.19 million [4] - DAU in the Rest of World segment was 280 million, surpassing the estimate of 277.31 million [4] - ARPU in Europe was $2.99, above the estimate of $2.82 [4] - ARPU in the Rest of World was $1.11, slightly below the estimate of $1.12 [4] - ARPU in North America was $9.20, matching the estimate [4] - Full-time employees numbered 5.19 billion, below the average estimate of 5.26 billion [4] Geographic Revenue - Revenue from Europe was $297.95 million, exceeding the estimate of $284.2 million, representing a year-over-year change of +19.7% [4] - Revenue from the Rest of World was $311.08 million, slightly above the estimate of $309.73 million, with a year-over-year change of +16.9% [4] - Revenue from North America was $897.81 million, below the estimate of $900.18 million, with a year-over-year change of +4.7% [4]

Financial Performance - Snap Inc. reported a net loss of $103,541,000 for the three months ended September 30, 2025, compared to a net loss of $153,247,000 for the same period in 2024, representing a 32.5% improvement[31]. - Revenue for the third quarter of 2025 was $1,506,839,000, an increase of 9.7% from $1,372,574,000 in the third quarter of 2024[31]. - Operating loss for the three months ended September 30, 2025, was $128,362,000, compared to an operating loss of $173,210,000 in the same period of 2024, indicating a 26.0% reduction in operating losses[31]. - Snap Inc. reported a total comprehensive loss of $102,371,000 for Q3 2025, compared to a total comprehensive loss of $127,180,000 in Q3 2024, reflecting a 19.5% improvement[34]. - The net loss attributable to common stockholders for the three months ended September 30, 2025, was $88.0 million, resulting in a basic net loss per share of $(0.06)[63]. - The diluted net loss per share attributable to common stockholders for the three months ended September 30, 2025, was also $(0.06)[63]. - The company reported a net loss of $505.7 million for the nine months ended September 30, 2025, an improvement from a net loss of $707.0 million in the same period of 2024[211]. Revenue Breakdown - Advertising revenue for the three months ended September 30, 2025, was $1,317,119, compared to $1,249,322 in 2024, an increase of approximately 5.4%[56]. - Other revenue for the three months ended September 30, 2025, was $189,720, up from $123,252 in 2024, reflecting an increase of approximately 53.8%[56]. - For the nine months ended September 30, 2025, total revenue reached $4,214,986, compared to $3,804,115 in 2024, marking an increase of approximately 10.8%[56]. - North America generated $870,030 in revenue for the three months ended September 30, 2025, compared to $826,179 in 2024, an increase of approximately 5.3%[57]. - Revenue from Europe for the three months ended September 30, 2025, was $285,800, up from $241,342 in 2024, representing an increase of approximately 18.4%[57]. - Revenue from the Rest of World for the three months ended September 30, 2025, was $351,009, compared to $305,053 in 2024, an increase of approximately 15.1%[57]. Cash Flow and Liquidity - Cash flows from operating activities generated $146,488,000 in Q3 2025, up from $115,872,000 in Q3 2024, reflecting a 26.4% increase[29]. - Cash, cash equivalents, and marketable securities totaled $3.0 billion as of September 30, 2025[144]. - Cash paid for interest was $58.1 million for Q3 2025 and $62.7 million for the nine months ended September 30, 2025, compared to $2.3 million and $8.1 million for the same periods in 2024[98]. - Free Cash Flow for the third quarter of 2025 was $93.4 million, compared to $71.8 million in the prior year[144]. - Net cash provided by operating activities was $386.6 million for the nine months ended September 30, 2025, a 111% increase from $182.8 million in the same period of 2024[201]. - Net cash provided by investing activities was $110.3 million for the nine months ended September 30, 2025, compared to a net cash used of $568.3 million in 2024, indicating a significant turnaround[202]. Expenses and Costs - Total costs and expenses for the third quarter of 2025 were $1,635.2 million, compared to $1,545.8 million in the prior year[144]. - Cost of revenue for the three months ended September 30, 2025, increased to $674,220, a 6% increase from $638,907 in 2024[177]. - Research and development expenses for the three months ended September 30, 2025, were $453,418, a 10% increase from $412,791 in 2024[178]. - Sales and marketing expenses for the three months ended September 30, 2025 decreased by $16.9 million (6%) compared to the same period in 2024, totaling $256.2 million[179]. - General and administrative expenses for the three months ended September 30, 2025 increased by $30.4 million (14%) compared to the same period in 2024, totaling $251.3 million[180]. Debt and Financing - As of September 30, 2025, total debt amounted to $3.54 billion, with a net carrying amount of $3.54 billion after accounting for debt issuance costs and discounts[97]. - The company issued $550.0 million principal amount of senior notes due in 2034, with net proceeds of $541.1 million after debt issuance costs of $8.9 million[75]. - In February 2025, the company issued $1.50 billion principal amount of senior notes due in 2033, with net proceeds of $1.47 billion after $26.9 million in debt issuance costs[79]. - The company repurchased and retired 57.3 million shares of Class A common stock for $500.6 million during the nine months ended September 30, 2025[70]. - The company had $3.9 billion in non-cancelable commitments primarily related to data processing and storage services, due within three years as of September 30, 2025[105]. Legal and Regulatory Matters - The company was named as a defendant in a federal securities class action lawsuit related to misleading statements about the impact of Apple's App Tracking Transparency framework[227]. - The lawsuit seeks monetary damages and other relief, and while a settlement has been reached, it is subject to court approval[227]. - If the settlement is not approved, the company will continue to litigate the case, which poses a risk to its business[227]. User Metrics - Daily Active Users (DAUs) increased 8% year-over-year to 477 million[144]. - Average Revenue Per User (ARPU) was $3.16, compared to $3.10 in the prior year[144].

Core Insights - Snap announced a $400 million partnership with AI startup Perplexity, leading to a stock price surge of over 20% after the release of better-than-expected Q3 earnings [1][3] - The partnership aims to integrate Perplexity's AI search engine into Snapchat by 2026, providing users with conversational answers from verified sources [3] - Snap's Q3 revenue increased by 10% year-over-year to $1.5 billion, surpassing analyst expectations, while net losses narrowed to $104 million, significantly better than the anticipated loss of over $200 million [1][3] Financial Performance - Q3 revenue reached $1.5 billion, a 10% increase year-over-year, slightly above analyst forecasts [1] - Net loss for the quarter was $104 million, much lower than the expected loss of over $200 million [1] - Despite the positive quarterly results, Snap's stock has declined approximately 20% year-to-date [1] Advertising and Market Challenges - North American advertising revenue grew only 1% year-over-year, with reduced spending from major brand advertisers being a significant obstacle to overall revenue growth [1] - The partnership with Perplexity is seen as a new revenue channel amid challenges in advertising growth, particularly against competitors like Meta [3] - Snap's monthly active users increased by 7% year-over-year to 943 million, indicating a growing user base despite advertising challenges [3] Strategic Developments - Snap is shifting the development of its augmented reality glasses, Spectacles, to a subsidiary named "Specs," following a model similar to Alphabet's Waymo [3] - The company is in discussions with investors to inject more funds into the Specs division, although the launch of Specs products in 2026 is planned without reliance on external capital [3]

Snap (SNAP) came out with quarterly earnings of $0.06 per share, in line with the Zacks Consensus Estimate . This compares to earnings of $0.08 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this company behind Snapchat would post earnings of $0.01 per share when it actually produced a loss of $0.01, delivering a surprise of -200%.Over the last four quarters, the company has surpassed consensus EPS estimates just once.Snap, which belongs to the ...

US stocks stalled before the bell on Thursday as concerns about Big Tech continued to dog markets and a Supreme Court hearing fed hopes for a shift in President Trump's aggressive tariff push. Futures on the Dow Jones Industrial Average (YM=F) and the S&P 500 (ES=F) wobbled around the flat line. Contracts on the tech-heavy Nasdaq 100 (NQ=F) were also little changed on the heels of Wednesday's comeback for major US gauges, fueled by upbeat jobs data and a revival in tech stocks. A rebound in AI-linked na ...

US stocks edged higher before the bell on Thursday as concerns about Big Tech continued to dog markets and a Supreme Court hearing fed hopes for a shift in President Trump's aggressive tariff push. Futures on the S&P 500 (ES=F) and the tech-heavy Nasdaq 100 (NQ=F) both moved up roughly 0.2%. Meanwhile, Dow Jones Industrial Average futures (YM=F) were little changed on the heels of a comeback for stocks that was also fueled by surprise growth in jobs. A rebound in AI-linked names on Wednesday also helped ...