Newsfilter article unlocker
Enter Newsfilter article ID in the field below. Example: https://newsfilter.io/articles/39be1bef03e66cdc886c08a2a6319c47
Snap (SNAP.N) said on Wednesday its first-quarter revenue rose 12% on the back of resilient advertising spending and that its number of daily active users returned to growth, driven by markets outside of North America and Europe.
Shares of the company fell around 5% in extended trading.
The Snapchat parent, squeezed between dominant platforms such as TikTok and Meta's (META.O) Instagram in a crowded social media market, has been turning to subscriptions to boost its revenue, which comes predominantly from advertising sales.
Snap and artificial intelligence start-up Perplexity "amicably" ended their $400 million deal in the first quarter, it said on Wednesday, around six months after announcing it.
The Perplexity integration was aimed to offer verifiable answers to users' questions within the Snapchat app.
Snap's first-quarter revenue of $1.53 billion came in line with LSEG-compiled analysts' average estimate.
The company expects second-quarter revenue of $1.52 billion to $1.55 billion, the mid-point of which is largely in line with estimates of $1.54 billion.
Snap reported 483 million daily active users in the first quarter, adding 9 million from the prior quarter. However, daily active users in major market North America declined, while revenue growth in the region slowed to 2% in the first quarter.
Adjusted earnings before interest, taxes, depreciation, and amortization came in at $233.3 million, beating estimates of $205.9 million, helped by improved operational efficiencies.
The results come a month after Snap said it would lay off about 1,000 employees, including 16% of full-time staff. The move, which also included the closure of more than 300 open roles, came after Irenic Capital Management pushed the company to optimize its portfolio and improve performance.
The company said in February that its Snapchat+ subscribers have surpassed 25 million.
