Published: Wed, February 07, 2018
Finance | By Gustavo Carr

SunTrust Banks Weighs in on Snap Inc's FY2022 Earnings (SNAP)

SunTrust Banks Weighs in on Snap Inc's FY2022 Earnings (SNAP)

The company's stock shot up by more than 27 percent in after-hours trading. The app now reaches 187 million daily active users, up from 178 million in the last quarter and a bump of 18 percent year over year.

Snap, which makes the Snapchat photo-messaging app, said fourth-quarter sales jumped 72 percent to $285.7 million, beating the $252.8 million average projection of analysts, according to data compiled by Bloomberg. Net losses came in at $349.98 million, compared to net losses of $169.95 million during Q4 of 2016. Back then, Snap had an innovative new app built on the idea of quickly-disappearing messages. Snapchat users must know the feeling, since the update itself was released a few weeks ago without any word from the company, as reported by TechCrunch's Josh Constine. That would also put Snap's yearly sales at $793 million, nearly double the $404 million it brought in in 2016. Still, Snap Inc shares closed up about 1.52 percent to $14.06 earlier today. The company reported ($0.14) EPS for the quarter, topping analysts' consensus estimates of ($0.31) by $0.17. But Spiegel was issued a stock award that vested immediately at the time of the IPO, representing 3 percent of all outstanding shares and delivered in "equal quarterly installments over three years beginning in the third full calendar quarter following this offering".

Those design changes have put a bigger emphasis on user-to-user sharing, as opposed to content created by publishers and brands.

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Snap is now locked in a fight for its life with Facebook, which copied its marquee Stories feature - and the accompanying selfie filters and masks - and inserted them into all of its major products: Facebook, Instagram, WhatsApp and Messenger. Snap's new 8.9 million users will help, but the company will need to keep up the pace in order to thrive.

Spiegel warned in November that the redesign could be disruptive to Snap's business in the short term, so it will be interesting to see if the company provides any color as to how the rollout is going so far. The fourth quarter was an "important quarter for Snap as investor confidence in the company's growth story has waned".

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