Snap shares tumble over 10% after Q3 ad revenue and user growth miss expectations
Snap shares fell sharply in after-hours trading after third-quarter ad revenue and user metrics trailed expectations, despite the company reporting positive net income and launching its SPECS augmented reality product.
Snap shares dropped more than 10% in extended trading following the release of its third-quarter earnings report, weighed down by misses in advertising revenue and user growth. Chief Executive Officer Evan Spiegel addressed the results, acknowledging that advertising revenue growth remains below the company's ambitions, according to Bloomberg.[1][2][5][7]
Third-quarter revenue rose 14% year over year to $1.72 billion, falling short of the $1.73 billion projected by analysts according to Barron's and Wall St Engine, though Bloomberg characterized the figure as in line with expectations. Daily active users reached 495 million, climbing 4% but missing estimates ranging from 497.8 million to 499 million. Monthly active users rose 4% year over year to 977 million, while average revenue per user came in at $3.48, marginally ahead of the $3.47 estimate.[1][4][6]
Despite top-line and user pressures, Snap delivered positive net income of $56 million and earnings per share of $0.03, outperforming consensus estimates of $0.00. Adjusted EBITDA reached $383 million against an estimated $337 million, while free cash flow totaled $164 million versus a $127 million estimate. The company also announced the launch of SPECS for augmented reality, highlighting artificial intelligence as an emerging operational and advertising advantage as it pursues its long-term AR strategy.[3][4]
Following the earnings slide, Snap shares are down approximately 94% from their all-time high, according to The Kobeissi Letter.[7]
Key facts
- Snap reported Q3 revenue of $1.72 billion, up 14% year over year but below Wall Street estimates of $1.73 billion according to Barron's and Wall St Engine.
- Daily active users reached 495 million, falling short of analyst expectations of 497.8 million to 499 million.
- Snap CEO Evan Spiegel acknowledged that advertising revenue growth remains below the company's ambitions.
- Snap posted Q3 earnings per share of $0.03 versus an expected $0.00, along with positive net income of $56 million.
- Adjusted EBITDA came in at $383 million and free cash flow reached $164 million, both topping analyst estimates.
- Snap launched SPECS for augmented reality.
- Snap shares dropped over 10% in after-hours trading and are down 94% from their all-time high, according to The Kobeissi Letter.
Sources · 7 sources
- TE
TechmemeArticle ·
Snap reports Q3 revenue up 14% YoY to $1.72B, in line with est., and DAUs up 4% to 495M, vs. 499M est.; SNAP drops 9%+ after hours (Spencer Soper/Bloomberg) Spencer Soper / Bloomberg : Snap reports Q3 revenue up 14% YoY to $1.72B, in line with est., and DAUs up 4% to 495M, vs. 499M est.; SNAP drops 9%+ after hours — Snap Inc. fell after the company reported third-quarter ad revenue and user growth that missed estimates, with Chief Executive Officer Evan Spiegel acknowledging that …
Open source - BL
Bloomberg@businessPost on X ·
Snap fell after the company reported third-quarter ad revenue and user growth that missed estimates, with CEO Evan Spiegel acknowledging that “advertising revenue growth remains below our ambitions” https://t.co/aepHvHWebL
Open source - TR
TrendSpider@TrendSpiderPost on X ·
$SNAP Q3 EARNINGS EPS: $0.03 vs $0.00 est ✅ Sales: $1.72B vs $1.73B est ❌ 🟥 -10% in after-hours https://t.co/pECDEyvFeO
Open source - WS
Wall St Engine@wallstenginePost on X ·
$SNAP Q3’26 EARNINGS HIGHLIGHTS 🔹 Revenue: $1.72B (Est. $1.73B) 🔴; +14% YoY 🔹 EPS: $0.03 (Est. $0.00) 🟢 🔹 Adjusted EBITDA: $383M (Est. $337M) 🟢 🔹 Free Cash Flow: $164M (Est. $127M) 🟢 Customers & Assets: 🔹 Daily Active Users: 495M (Est. 497.8M) 🔴 🔹 ARPU: $3.48 (Est. $3.47) 🟢 Announcements: 🔹 SPECS: Launched for augmented reality Other Q3 Metrics: 🔹 Monthly Active Users: 977M; +4% YoY Key Updates: 🔹 Net Income: $56M; positive net income in Q3 Comments: 🔸 “AI is becoming a significant advantage for our teams and advertising platform, and we continue to strengthen our business while investing in our long-term vision for augmented reality with the launch of SPECS.”
Open source - CN
CNBC@CNBCPost on X ·
Snap shares fall over 10% on third-quarter earnings miss https://t.co/oI29xgNp1c
Open source - BA
Barron's@barronsonlinePost on X ·
Snap posted revenue of $1.72 billion, below analyst estimates of $1.73 billion, prompting a double-digit slide in the share price. https://t.co/eiVl12zVjk
Open source - TK
The Kobeissi Letter@KobeissiLetterPost on X ·
BREAKING: Snapchat stock, $SNAP, falls over -10% after posting weaker than expected earnings. The stock is now down -94% from its all-time high. https://t.co/gmjhQmdjUZ
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