Snap earnings

Snap earnings DEFAULT

Snap Q3 FY2021 Earnings Report Preview: What to Look For

Key Takeaways

  • Analysts estimate adjusted earnings per share (EPS) of $0.08 vs. $0.01 in Q3 FY 2020.
  • The pace of average daily active user growth is expected to accelerate year-over-year (YOY).
  • Revenue is expected to grow at a robust pace, although at a slower rate than Q2 FY 2021.

Snap Inc. (SNAP) dramatically outperformed analysts' expectations in the most recent reported quarter as online traffic, earnings and revenue rose at a blazing pace. The gains were fueled largely by the economic recovery and new augmented-reality product offerings.

Investors will watch to see whether Snap can maintain its momentum when the company reports earnings after the market on Oct. 21, 2021, for Q3 FY 2021. Analysts expect adjusted earnings per share (EPS) to grow eight-fold year over year (YOY) as revenue surges by nearly two-thirds.

Investors will also focus on Snap’s daily active users (DAUs), a key metric indicating the size of the company’s total user base. Snap needs to grow its user base to attract more ad spending from advertisers. In Q3, analysts expect DAUs to rise by more than 20% year-over-year (YOY) for the fourth straight quarter.

Snap shares have vastly outperformed the broader market. The stock has outpaced the S&P 500 for the past year, driven by surges following the company's Q3 FY 2020 and Q2 FY 2021 earnings releases. Snap shares traded largely sideways from late July 2021 through October 2021. But overall, Snap has provided a 1-year trailing total return of 171.0%, far ahead of the S&P 500's total returns of 30.5%.

Snap Earnings History

Until recently, Snap has struggled to post positive adjusted EPS. The company reported at least seven consecutive quarters of negative adjusted EPS from Q1 FY 2018 through Q3 FY 2019, and then again in Q1 and Q2 FY 2020. That started to change in Q3 FY 2021. Since then, the company has reported four straight quarters in a row of profits through Q2 FY 2021. Analysts expect that to continue in Q3, with EPS rising 700% to $0.08.

Despite its erratic profit performance, Snap has been able to produce strong revenue growth, which is common with many fast-growing tech companies. Snap has quarterly revenue growth in each of the past 14 quarters. Between Q1 FY 2018 and Q3 FY 2020, YOY quarterly revenue growth ranged from 36.5% to 52.1% nearly every quarter, except for Q2 2020. Even in that quarter, revenue rose by a healthy 17.0%. The pace of growth has accelerated in the most recent three quarters, rising by 116.3% in Q2 FY 2021.

Snap Key Stats
Estimate for Q3 FY 2021Q3 FY 2020Q3 FY 2019
Adjusted Earnings Per Share ($)0.080.01-0.04
Revenue ($B)
Average Daily Active Users (M)301.9249.0210.0

Source: Visible Alpha

The Key Metric

As mentioned above, investors will also focus on Snap’s DAUs, which are defined as any registered Snapchat user who opens the Snapchat app at least once during a 24-hour period. Average DAUs for any specific quarter are calculated by summing the number of DAUs on each day of that quarter and dividing the total by the number of days in the quarter. The metric provides a snapshot of the size of Snap’s total user base. Snap generates the majority of its revenue through selling ad space to advertisers. The bigger the user base, the more attractive Snap’s platform is to potential advertisers. To create an attractive platform for users, Snap must continually invest in providing more engaging features than its competitors.

Snap has seen its DAU grow for nine straight quarters starting in Q2 FY 2019. In recent quarters, this pace of YOY growth has accelerated, reaching 21.6% in Q4 FY 2020 and as high as 23.1% in Q2 FY 2021. Analysts expect continued robust growth in Q3, with DAU rising 21.3% YOY, significantly faster than the same quarter a year earlier.


Snap Earnings Date & Reports

After Market Hours Not Confirmed

Snap (SNAP) Earnings, Revenues Date & History

The upcoming earnings date is based on a company’s previous reporting, and may be updated when the actual date is announced

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

SNAP Earnings Price Changes

Earnings announcements can affect a stock’s price. This table shows the stock's price the day before and the day after recent earnings reports, including the percentage change.
What's Included in PREMIUM?
Make informed decisions based on Top Analysts' activity
Know what industry insiders are buying
Get actionable alerts from top Wall Street Analysts
Find out before anyone else which stock is going to shoot up
Get powerful stock screeners & detailed portfolio analysis

Disclaimer: The TipRanks Smart Score performance is based on backtested results. Backtested performance is not an indicator of future actual results. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. Backtested results are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. General assumptions include: XYZ firm would have been able to purchase the securities recommended by the model and the markets were sufficiently liquid to permit all trading. Changes in these assumptions may have a material impact on the backtested returns presented. Certain assumptions have been made for modeling purposes and are unlikely to be realized. No representations and warranties are made as to the reasonableness of the assumptions. This information is provided for illustrative purposes only. Backtested performance is developed with the benefit of hindsight and has inherent limitations. Specifically, backtested results do not reflect actual trading or the effect of material economic and market factors on the decision-making process. Since trades have not actually been executed, results may have under- or over-compensated for the impact, if any, of certain market factors, such as lack of liquidity, and may not reflect the impact that certain economic or market factors may have had on the decision-making process. Further, backtesting allows the security selection methodology to be adjusted until past returns are maximized. Actual performance may differ significantly from backtested performance. Backtested results are adjusted to reflect the reinvestment of dividends and other income and, except where otherwise indicated, are presented gross-of fees and do not include the effect of backtested transaction costs, management fees, performance fees or expenses, if applicable. Please note all regulatory considerations regarding the presentation of fees must be taken into account. No cash balance or cash flow is included in the calculation.
  1. Sexy roman reigns
  2. Casting brand clothing
  3. 2017 f150 windshield wipers

Snap pops more than 16% on earnings beat and user growth

Snap's stock jumped after the company reported Thursday its second-quarter earnings, beating expectations across the board for earnings, revenue and user growth.

Here's what Snap reported versus Wall Street's estimates:

  • Adjusted earnings per share: 10 cents vs. 1 cent loss forecast by Refinitiv
  • Revenue: $982 million vs. $846 million forecast by Refinitiv
  • Global daily active users (DAUs): 293 million vs. 290.3 million per StreetAccount
  • Average revenue per user (ARPU): $3.35 vs. $2.92 per StreetAccountt

Shares of Snap traded more than 16% higher before the bell on Friday.

Snap said the company was not impacted by Apple's iOS 14.5 privacy changes as it had anticipated that it would be. This was due to the mobile operating system update rolling out later than expected, iOS users being slow to update their devices and Snap observing "higher opt-in rates than we are seeing reported generally across the industry, which we believe is due in part to the trust our community has in our products and our business," Jeremi Gorman, Snap's chief business officer, said in her prepared remarks.

"This has given us more time with advertisers to navigate the transition but also means the effects of these changes will come later than we initially expected," Gorman said.

Snap's net loss narrowed 53% to $152 million, from a loss of $326 million a year ago.

Snap reported 293 million daily active users, up nearly 5% from the 280 million the company reported in April. That figure is up more than 23% compared with the 238 million daily users the company reported a year prior.

Snap expects year-over-year revenue growth of 58% to 60% for the third quarter, the company said. That is down compared to the 116% annualized revenue growth it saw in Q2. Snap expects to reach approximately 301 million DAUs in the third quarter, the company said in its prepared remarks.

"This range reflects our best current estimate of the potential impact of anticipated disruptions associated with the iOS platform changes," Snap Chief Financial Officer Derek Andersen said in his prepared remarks.

The company said the resurgence of Covid-19 cases presents an uncertain operating environment heading into Q3.


Snap’s stock (NYSE: SNAP) is scheduled to report its fiscal Q3 2021 results on Thursday, October 21. We expect Snap to beat the consensus estimates for revenues, while its earnings will likely be in line with the consensus. The company has beaten consensus estimates for revenue and earnings for each of the last four quarters. In the past year the company has increased engagement as daily average users continue to increase every quarter. In Q2 2021, the company launched 177 million new international Discover Channels, including 36 in the UK and 24 in India, one of which is a partnership with Sony Pictures Network to launch five shows. For Q2 2021, Spotlight, the company’s newest platform surfacing the most entertaining Snaps from the community, saw daily active users grow by 49%, average daily content submissions tripled, and daily time spent per user in the U.S. grow by over 60% compared to the previous quarter. We expect the same to drive the third-quarter FY2021 results as well..

Our forecast indicates that Snap’s valuation is $81 per share, which is about 8% higher than the current market price of around $75. Our interactive dashboard analysis on Snap’s pre-earnings has more details.

(1) Revenues expected to be marginally ahead of the consensus estimates

Snap’s revenues for full-year 2020 were $2.5 billion – up 46% y-o-y, mainly due to growth in North America Advertising revenues as the digital form of advertising continues to garner higher demand. Trefis estimates Snap’s fiscal Q3 2021 revenues to be around $1.14 billion, just above the $1.1 billion consensus estimate. We expect the North America segment to continue to drive results. Our dashboard on Snap’s revenues offers more details on the company’s operating segments along with our forecast for the next 2 years.

2) EPS is likely to be in line the consensus estimates

Snap Q3 2021 earnings per share is expected to be $0.08 per Trefis analysis, in line with the consensus estimate of $0.08. The company’s net loss decreased from $325.9 million to $151.6 million in the first quarter of 2021 as they continue to work on improvement in their operating margin. We expect the net income margin to improve in FY2021 compared to the previous year.

(3) Stock price estimate 8% more than current market price

We arrive at Snap’s valuation, using an RPS estimate of around $3.57 and a P/S multiple of 22.8x in fiscal 2022. This translates into a price of $81, which is 8% above the current market price of around $75.

While Snap’s stock could trade slightly higher after the company reports earnings, our analysis of Snap vs. Twitter also finds Snap to be a better investment option. Also, Snap Peer Comparison summarizes how the company fares against peers on metrics that matter.

What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market consistently since 2016.

Invest with Trefis Market Beating Portfolios

See all Trefis Price Estimates

Led by MIT engineers and Wall Street analysts, Trefis (through its dashboards platform helps you understand how a company's products, that you

Led by MIT engineers and Wall Street analysts, Trefis (through its dashboards platform helps you understand how a company's products, that you touch, read, or hear about everyday, impact its stock price. Surprisingly, the founders of Trefis discovered that along with most other people they just did not understand even the seemingly familiar companies around them: Apple, Google, Coca Cola, Walmart, GE, Ford, Gap, and others. This might include you though you may have invested money in these companies, or may have been working with one of them for years as an employee, or have consulted with them as an expert for a long time. You can play with assumptions, or try scenarios, as-well-as ask questions to other users and experts. The platform uses extensive data to show in a single snapshot what drives the value of a company's business. Trefis is currently used by hundreds of thousands of investors, company employees, and business professionals.


Earnings snap


Snap beats on top and bottom, stock soars


You will also be interested:


266 267 268 269 270