Snap (NYSE:SNAP) Announces Quarterly Earnings Results, Misses Estimates By $0.12 EPS

Snap (NYSE:SNAP) issued its quarterly earnings data on Wednesday. The company reported $0.03 EPS for the quarter, missing analysts’ consensus estimates of $0.15 by ($0.12), FiscalAI reports. The firm had revenue of $1.72 billion during the quarter, compared to analyst estimates of $1.70 billion. Snap had a negative return on equity of 20.91% and a negative net margin of 7.76%.The business’s quarterly revenue was up 10.2% compared to the same quarter last year. During the same quarter in the prior year, the firm earned $0.01 EPS.

Here are the key takeaways from Snap’s conference call:

• Financial results and profitability beators — Q4 revenue was $1.72B (+10% YoY) with adjusted gross margin at 59%, adjusted EBITDA of $358M, net income of $45M, Q4 free cash flow of $206M, and a new $500M share repurchase authorization.
• Subscriptions/other revenue are accelerating — other revenue rose 62% YoY to $232M and subscribers grew 71% YoY to 24M, driven in part by memory storage plans that also improve retention.
• Ad product momentum and advertiser growth — total active advertisers +28% YoY, strong traction for Sponsored Snaps and Promoted Places (improving CTRs, ROAS and DPA/app ad performance), and notable growth in SMBs and DR advertising.
• Pivot toward profitable growth is weighing on engagement — management materially cut community growth marketing, leaving MAU at 946M (near 1B) but DAU down 3M to 474M as the company rebalances growth toward higher‑monetization geographies.
• Specs/AR roadmap offers long-term upside but requires investment — Snap plans a consumer Specs launch in 2026 with Snap OS 2.0, Lens Studio and Snap Cloud support; promising developer ecosystem and use cases, though execution and capital needs remain uncertainties.

Snap Stock Down 13.1%

Shares of NYSE:SNAP opened at $5.14 on Friday. The company has a quick ratio of 3.67, a current ratio of 3.67 and a debt-to-equity ratio of 1.57. The company’s 50-day moving average price is $7.63 and its two-hundred day moving average price is $7.87. Snap has a 12 month low of $5.10 and a 12 month high of $11.26. The firm has a market cap of $8.83 billion, a P/E ratio of -19.02 and a beta of 0.83.

More Snap News

Here are the key news stories impacting Snap this week:

• Positive Sentiment: Q4 results showed revenue growth, margin improvement and higher profitability (management cited a pivot to more profitable growth). This supports a recovery narrative and underpins some buy-side upgrades. Q4 Results Press Release
• Positive Sentiment: Management emphasized revenue diversification (subscriptions, ads) and embedding AI across the ad platform as a path to more profitable growth — a strategic positive if execution continues. Snap Embeds AI Across Ad Platform
• Positive Sentiment: Some firms upgraded or raised conviction (Bank of America and B. Riley recently moved to Buy/upgraded), giving pockets of buy interest despite broad caution. Snap Gets Upgraded After Earnings
• Positive Sentiment: Unusually large call-option volume shows speculative or directional bullish positioning (222k calls traded), which can amplify intraday upside if sentiment shifts. Large Call Options Volume
• Neutral Sentiment: Snap filed its Form 10-K (annual audited financials) — required disclosure but no major surprises flagged in the bulletin. Useful for diligence but not an immediate catalyst. Form 10-K Filing
• Neutral Sentiment: Citizens Jmp reaffirmed a Market Perform rating — indicates some firms remain cautiously neutral amid mixed signals. Market Perform Reaffirmed
• Negative Sentiment: Multiple major brokers cut price targets and/or trimmed ratings (examples: JPMorgan, Cantor Fitzgerald, Wells Fargo, TD Cowen, Mizuho and others), which pressured sentiment and likely weighed on the intraday decline. Wells Fargo Price Target Cut
• Negative Sentiment: Management gave Q1 revenue guidance below street estimates and said Perplexity integration revenue is not included (deal rollout uncertain) — this leaves near-term top-line visibility cloudy. Guidance Below Estimates / Perplexity Delay
• Negative Sentiment: Daily active users declined and the stock recently hit record lows, flipping key technical support — negative for sentiment and could limit near-term upside until user growth stabilizes. User Decline and Technical Breakdown
• Negative Sentiment: Analyst consensus moved to a “Reduce”/more cautious stance (majority holds/holds-to-sell), increasing the weight of bearish research and limiting fresh institutional buying. Consensus ‘Reduce’ Rating

Analyst Ratings Changes

SNAP has been the subject of a number of recent analyst reports. Truist Financial increased their price objective on Snap from $10.00 to $11.00 and gave the stock a “hold” rating in a report on Friday, November 7th. Susquehanna decreased their target price on Snap from $9.00 to $6.50 and set a “neutral” rating for the company in a research report on Thursday. Bank of America raised Snap from a “neutral” rating to a “buy” rating and set a $10.00 price objective for the company in a research report on Thursday. Wells Fargo & Company reduced their target price on shares of Snap from $10.00 to $8.00 and set an “equal weight” rating for the company in a research note on Thursday. Finally, Mizuho decreased their price target on Snap from $9.00 to $7.00 and set a “neutral” rating for the company in a research note on Thursday. Four research analysts have rated the stock with a Buy rating, twenty-two have issued a Hold rating and five have issued a Sell rating to the company’s stock. Based on data from MarketBeat.com, Snap has a consensus rating of “Reduce” and a consensus target price of $8.61.

Insider Buying and Selling at Snap

In other news, General Counsel Michael J. O’sullivan sold 70,882 shares of the company’s stock in a transaction dated Monday, November 17th. The stock was sold at an average price of $8.34, for a total value of $591,155.88. Following the completion of the sale, the general counsel directly owned 1,854,982 shares of the company’s stock, valued at $15,470,549.88. This represents a 3.68% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, CFO Derek Andersen sold 23,715 shares of Snap stock in a transaction that occurred on Wednesday, January 14th. The stock was sold at an average price of $7.83, for a total transaction of $185,688.45. Following the transaction, the chief financial officer directly owned 2,972,051 shares in the company, valued at $23,271,159.33. The trade was a 0.79% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last three months, insiders sold 393,341 shares of company stock valued at $3,169,210. 22.68% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Snap

Hedge funds have recently bought and sold shares of the company. Alyeska Investment Group L.P. bought a new stake in shares of Snap in the 3rd quarter valued at $176,697,000. Voloridge Investment Management LLC lifted its position in Snap by 53.3% in the 3rd quarter. Voloridge Investment Management LLC now owns 10,300,911 shares of the company’s stock valued at $79,420,000 after acquiring an additional 3,582,223 shares in the last quarter. Holocene Advisors LP boosted its stake in Snap by 895.9% in the 3rd quarter. Holocene Advisors LP now owns 3,560,234 shares of the company’s stock worth $27,449,000 after purchasing an additional 3,202,737 shares during the period. Westerly Capital Management LLC bought a new position in Snap during the 3rd quarter worth about $11,565,000. Finally, Freestone Grove Partners LP acquired a new stake in shares of Snap in the 3rd quarter valued at about $10,375,000. 47.52% of the stock is currently owned by institutional investors and hedge funds.

Snap Company Profile

Snap Inc is a camera and social media company best known for developing and operating Snapchat, a multimedia messaging application that allows users to send photos, videos and messages that disappear after being viewed. In addition to its core messaging service, Snap offers a suite of augmented reality (AR) tools, including custom Lenses and Filters, that enable users and third-party developers to create interactive and immersive experiences. The company also provides advertising solutions that allow brands to engage audiences through Snap Ads, Sponsored Lenses and Discover content on the platform.

Founded in 2011 by Evan Spiegel and Bobby Murphy, Snap has continually focused on innovation in camera technology and AR.