Shares of Snapchat owner Snapchat rose 21% in after-hours trading after the social media group beat Wall Street expectations for quarterly revenue and user growth.
Improvements to Snap’s advertising system are seeing results faster than expected, the company said.
Snapchat’s daily active users rose to 422 million in the first three months of this year, beating analysts’ expectations of 419.6 million. Meanwhile, first-quarter sales rose 21% to $1.2 billion, beating analysts’ consensus estimates of $1.12 billion.
Santa Monica, Calif.-based Snap has long struggled to compete for ad dollars with larger rivals like Metaplatforms, which owns Facebook and Instagram. But over the past year, the company has worked to improve how it targets ads to users and simplify how users interact with them.
In a letter to shareholders, Snap said its results are improving faster than expected due to increased demand for upgrades and features that help brands drive sales and website clicks.
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“The value we provide to our community and advertising partners has translated into improved financial performance,” said Snap CEO Evan Spiegel. “Our large, growing, yet difficult to access community, brand-safe environment, and full-funnel advertising solutions make us an increasingly important partner for businesses of all sizes.”
On Tuesday, the U.S. Senate passed a bill that would give Chinese tech company ByteDance up to a year to sell the hugely popular video app TikTok, another Snap rival. Otherwise, the app will be banned in the US.
Snap said it expected second-quarter sales of $1.23 billion to $1.26 billion, slightly above analysts’ expectations. The company expects its user base to grow to 431 million people.
Report contributed by Reuters
Source: www.theguardian.com
