Shares of Snap (SNAP +2.28%), the parent of Snapchat, were getting torched once again today as the company fell well short of analyst estimates in its fourth-quarter earnings report. Revenue growth was sluggish as the company failed to capitalize on a broader recovery in the digital advertising industry.

As of 11:23 a.m. ET, the stock was down 35.3% on the news.

Image source: Getty Images.

Snap still can't turn a GAAP profit

Snap said revenue in the quarter increased 5% to $1.36 billion, which missed the consensus at $1.38 billion. The company continued to grow its user base as daily active users (DAU) rose 10% to 414 million, though that growth rate decelerated from prior quarters.

The company continued to struggle in the ad market, even as larger peers like Alphabet and Meta posted double-digit advertising growth in their fourth quarters. That bifurcation shows advertisers may be giving up on Snapchat, and the company has struggled to monetize a platform that is, in large part, a messaging service.

On the bottom line, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) fell from $233 million in the quarter a year ago to $159 million. Adjusted earnings per share slipped from $0.14 to $0.08, beating the consensus at $0.06.

Share-based compensation remained elevated at $333 million, or roughly 25% of revenue, and shares outstanding increased 4% year over year.

SNAP - Snap

$6.27+$0.14 (+2.28%)

NYSE · As of 4:00 PM ET 10/19/26

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Key data points

Market capMarket cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary.$10.60B

Day's range$6.05 - $6.36

52wk range$3.81 - $9.13

Volume33.7M

Avg volume37.1M

Gross margin54.63%

What's next for Snap

Snap shares plunged along with the rest of the digital advertising sector in 2022 as the industry slowed down, but it has struggled to mount a recovery, even as stocks like Alphabet and Meta have bounced back. The company has been unable to prove it can be profitable on a generally accepted accounting principles (GAAP) basis.

Looking ahead, first-quarter guidance called for revenue of $1.095 billion to $1.135 billion, up 11%-15% and in line with estimates at $1.12 billion, and an adjusted EBITDA loss of $55 million-$95 million.

While that might indicate momentum in the right direction, given the weak growth and continued lack of profits, it's unsurprising to see investors dumping the stock again today.