LONDON – Snap Inc reported better-than-expected fourth quarter revenue and user growth, as the Snapchat parent company had high advertising demand during the holiday season and attracted more users in emerging markets.
The results indicate Snap has avoided additional damage from Apple Inc’s privacy changes, which were introduced last year and allow users to prevent apps from tracking their online activity for advertising purposes.
Snap forecast first quarter revenue between $1.03 billion to $1.08 billion, and daily active users to be between 328 million to 330 million. The guidance for both metrics surpassed analyst estimates, according to IBES data from Refinitiv.
Shares of Facebook owner Meta Platforms Inc fell 26% Thursday in what could be the largest single-day wipeout in market value for a US company, a day after it said the impact from Apple’s privacy changes could be “in the order of $10 billion” this year.
Meta said, according to Reuters, the Apple updates hurt advertisers’ ability to target ads to potential customers and measure the effectiveness of ads.
A large portion of Snap’s advertisers began using new ad measurement tools by the end of the fourth quarter, and parts of Snap’s advertising business began to recover from the Apple changes “quicker than we anticipated,” said Snap Chief Financial Officer Derek Andersen, in prepared remarks released ahead of the earnings call with analysts.
However, global supply chain disruptions and labor shortages hurt advertising demand from consumer packaged goods and restaurant brands, he added.
Snap’s revenue for the fourth quarter ended Dec. 31 was $1.3 billion, an increase of 42% from the prior-year quarter. The figure beat analyst expectations of $1.2 billion, according to IBES data from Refinitiv.
Daily active users on Snapchat rose 20% year-over-year to 319 million, beating consensus estimates of 316.5 million.
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