Snap (SNAP) earnings Q1 2021

A woman stands in front of the Snap Inc. logo on the floor of the New York Stock Exchange (NYSE), waiting for Snap Inc. to publish its IPO in New York City.

Lucas Jackson | Reuters

Snap’s stock rose up to 6% in after-hours trading Thursday after the company released its first quarter results, which exceeded Wall Street’s expectations for earnings, revenue and user growth.

Here’s what Snap reported against Wall Street estimates:

  • Adjusted loss per share: 0 cents versus 6 cents forecast by Refinitiv
  • Revenue: $ 770 million versus $ 743.8 million projected by Refinitiv
  • Global Daily Active Users (DAUs): 280 million versus 274.62 million per FactSet
  • Average Revenue Per User (ARPU): $ 2.74 versus $ 2.72 forecast by FactSet

The company released an adjusted EBITDA forecast that it will lose up to $ 20 million or break even in the second quarter.

Snap’s net loss decreased 6% to $ 287 million, from a loss of $ 306 million a year ago.

Snap expects revenue to grow 80% to 85% year-over-year for the second quarter, Snap’s chief financial officer Derek Andersen said in prepared remarks, a significant acceleration from annualized revenue growth of 66% in the first quarter. The company also expects to hit around 290 million DAUs in the second quarter.

That revenue forecast includes Snap’s estimate of the potential impact of Apple’s privacy changes in iOS 14, Andersen said. These changes could affect the ability of social media companies to target ads to users.

Andersen added that the first quarter was Snap’s first quarter with positive free cash flow as a public company that came in at $ 126 million. That was $ 131 million more than last year.

Snap reported 280 million daily active users, up nearly 6% from the 265 million the company reported in February. That number is up more than 22% compared to the 229 million daily users the company reported a year earlier.

Snap CEO Evan Spiegel also announced that Snapchat’s Android user base is now larger than the iOS user base. Spiegel called this inversion “a critical milestone that reflects the long-term value of the investment we have made in rebuilding our Android application.” This is also a major milestone for Snap, as it blamed issues with its Android app for poor user growth in the first few years after going public.

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