Snap emerged from a year-earlier loss with $56 million in third-quarter net income, but its revenue and average daily audience did not meet analysts' expectations; CNBC reported the shares lost more than 10% Wednesday.
Snap's revenue rose 14% from a year earlier to $1.72 billion, below LSEG's $1.73 billion estimate, CNBC reported. The company averaged 495 million global daily active users, short of StreetAccount's 499 million forecast. Adjusted earnings per share came to 19 cents, topping LSEG's 16-cent estimate. Adjusted earnings reached $383 million, exceeding StreetAccount's $337 million estimate. Average revenue per user was $3.48, matching StreetAccount's estimate.
For the year-earlier comparison, Snap reported a net loss of $104 million. The company forecast fourth-quarter revenue of $1.95 billion to $1.99 billion and adjusted earnings of $490 million to $525 million, CNBC reported.
Ronan Harris, Snap's chief commercial officer, told analysts that lower spending by consumer packaged goods companies weighed on sales. CNBC reported Harris attributed the reduced spending to macroeconomic pressures in the United States and the Middle East. He also cited positive growth signs in U.S. financial services and said Snap was seeking traction in other sectors.
Snap plans to make global monthly active users its primary audience measure starting with results for the first quarter of 2027. The company reported 977 million monthly active users in the third quarter. Its investor letter said daily engagement had historically been stable as a share of monthly engagement, and that a longer-term measure better reflects product and safety decisions and the goal of broader, durable audience growth, CNBC reported.
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