SNAP Snap Reports Q1 2022 Results; Mixed bag with Users a Beat
Lede
Snap Inc (NYSE:SNAP) reported earnings after the close of trading on 4-21-2022, and the results were a mixed bag.
Summary
The company delivered small beats across the board on daily active users (DAU), while missing slightly on average revenue per user (ARPU).
Overall, SNAP delivered over 38% revenue growth for Q1 2022 versus the period a year ago, while also delivering a non-GAAP gross margin % and EBITDA margin % beat.
The CFO noted that revenue growth from Jan 1, 2022 through February 23, 2022 came in at a 44% clip. The Ukraine war then started, and revenue growth from February 24, 2022 through the end of the quarter dropped to 32% growth.
It appears that SNAP was well on it's way to a large revenue beat.
Non GAAP EPS missed by $0.01 , and free cash flow came in short of expectations, but did continue the trend of positive free cash flow for the company.
Guidance for the following quarter (Q2 2022) was for 22.5% revenue growth (at the midpoint), which was below the consensus analyst estimate of 27.6%.
Please find a table of the results below:
While the company shared many highlights in the earnings presee release, these two caught our eye (our emphasis added):
- Total daily time spent by Snapchatters aged 25 and older engaging with shows and publisher content increased by more than 25% year-over-year.
- Revenue from Dynamic Ads more than tripled year-over-year, as we have increasingly seen advertisers leverage their product catalogs to automatically create ads in real time. (These are ads that can change as catalogues change.)
This reads like engagement is still very strong and may be accelerating.
Conclusion
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The author is long SNAP at the time of publication.
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