Key Stats for Snap Stock
- Pre-market Price Change for Snap stock: 18%
- $SNAP Share Price as of Nov. 5: $7.30
- 52-Week High: $13.28
- $SNAP Stock Price Target: $9.23
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What Happened?
Snap (SNAP) stock is up 18% in pre-market trading after the social media company reported third-quarter results that beat revenue expectations and announced a $500 million stock buyback program.
The company generated $1.51 billion in revenue, surpassing the $1.49 billion analysts had expected. Snap also announced a major partnership with AI search startup Perplexity, which will pay the company $400 million over one year, comprising both cash and equity, to integrate its conversational search into Snapchat, starting in early 2026.
Daily active users grew to 477 million, slightly ahead of the 476 million Wall Street predicted. Other revenue, which includes the Snapchat+ subscription service, surged 54% year-over-year to $190 million.
Snap did warn investors about potential headwinds ahead. CEO Evan Spiegel said new age verification requirements from Apple and Google, along with Australia’s social media age restrictions, could hurt user growth in the fourth quarter.
Snap expects overall daily active users may decline in Q4 as these changes roll out.
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What the Market Is Telling Us About Snap Stock
The 18% pop in Snap stock suggests investors are more excited about the Perplexity deal and strong subscription growth than worried about the Q4 user headwinds. The $400 million partnership represents a new revenue stream that doesn’t rely on traditional advertising.
CFO Derek Andersen noted that small and medium-sized businesses drove strong ad growth, with that segment growing over 25% in North America during the quarter.
However, large client advertising in North America saw a modest decline, which remains a concern for the company’s overall ad business.
Snap stock had been down 32% year-to-date before its Q3 earnings report, so some of the rally might reflect investors seeing value after a prolonged selloff.
The company’s improved profitability metrics also caught attention—net losses narrowed by over 30% year-over-year to $104 million, and adjusted EBITDA came in at $182 million, well above expectations.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
