What happened
Shares of Snap (SNAP 27.63%) have fallen today, down by 6% as of 11:20 a.m. EDT, after the company reported first-quarter earnings results. The Snapchat parent was able to generate daily active user (DAU) growth for the first time in a year.
So what
Revenue in the first quarter jumped 39% to $320 million, exceeding the consensus estimate of $307 million, as well as Snap's own guidance. That helped the company mitigate its losses, with operating loss shrinking by 19% to $316.1 million. Adjusted net loss also narrowed to $130.9 million, or $0.10 per share, beating the $0.12 per share that analysts expected Snap to lose on a non-GAAP basis. Adjusted EBITDA was negative $123.4 million.
Image source: Snap.
After stabilizing in recent quarters, DAUs ticked higher sequentially to 190 million, compared to 186 million in the fourth quarter. Average revenue per user came in at $1.68.
Now what
Snap attributed the better-than-expected results to ongoing improvements in the Android version of Snapchat, which the company recently started rolling out and is now widely available. CEO Evan Spiegel has emphasized the importance of Android to Snap's future growth, particularly in emerging markets.
"In the first quarter we delivered strong results across our business with growth in daily active users and revenue," Spiegel said in a statement. He continued:
Our new Android application is available to everyone, with promising early results. This month we announced several new products that we believe will drive further engagement and monetization. As we look toward the future, we see many opportunities to increase our investments, and will continue to manage our business for long-term growth.
In terms of guidance, the social media upstart expects revenue in the second quarter to grow between 28% and 37% to $335 million to $360 million. That should translate into adjusted EBITDA of negative $125 million to negative $150 million.
