Snap to Report Q1 Earnings: Key Metrics and Expectations to Watch

Core Viewpoint - Snap is expected to report its first-quarter 2025 results on April 29, with anticipated revenues between $1.33 billion and $1.36 billion, reflecting a 12.73% increase year-over-year [1][2]. Revenue Expectations - The Zacks Consensus Estimate for Snap's revenues is currently at $1.35 billion, indicating a significant year-over-year growth [2]. - Adjusted EBITDA is projected to be between $40 million and $75 million for the quarter [2]. Earnings Projections - The consensus estimate for earnings remains at 4 cents per share, which represents a 33.33% increase from the previous year's 3 cents [3]. - Snap has surpassed the Zacks Consensus Estimate for earnings in three of the last four quarters, with an average positive surprise of 58.57% [3]. Factors Influencing Performance - Snap is expected to benefit from strong growth in its direct response advertising business, particularly in retail, gaming, and financial services [4]. - The Snapchat+ subscription service has seen its subscriber count double year-over-year to 14 million, contributing significantly to revenue growth [5]. - The rollout of Sponsored Snaps and Promoted Places is likely to attract more advertising spend, especially from small and medium-sized businesses [6]. Cost Considerations - Snap anticipates a year-over-year increase in adjusted operating expenses of 11-12%, driven by headcount growth, wage inflation, and higher legal costs [7]. - Infrastructure efficiencies are expected to help offset some of the increased costs, with management estimating lower infrastructure costs per daily active user [8]. Earnings Outlook - Snap currently has an Earnings ESP of -25.00% and a Zacks Rank of 3, indicating a lower likelihood of an earnings beat [9].