Snap (NYSE:SNAP) Releases Earnings Results

Snap (NYSE:SNAP) announced its quarterly earnings data on Monday. The company reported ($0.10) EPS for the quarter, topping the consensus estimate of ($0.12) by $0.02, Zacks reports. The company had revenue of $1.60 billion during the quarter, compared to the consensus estimate of $1.54 billion. Snap had a negative net margin of 6.72% and a negative return on equity of 18.92%. The company’s quarterly revenue was up 18.9% on a year-over-year basis. During the same quarter last year, the firm posted ($0.16) EPS.

Here are the key takeaways from Snap’s conference call:

• Q2 revenue rose 19% year over year to $1.6 billion, while adjusted EBITDA increased to $250 million and free cash flow reached $121 million. Snap said revenue grew faster than costs, supporting expanding margins and operating leverage.
• Advertising momentum improved, with stronger large-advertiser demand in North America, continued SMB strength, and broader adoption of AI-powered Smart Campaigns. App purchase volume increased 128%, while dynamic product ads revenue grew 43%.
• Snap’s second revenue stream continued to expand, as other revenue grew 85% to $316 million, driven by Snapchat+, Memories Storage, and Lens+. With fewer than 3% of monthly active users paying, management sees substantial subscription penetration potential.
• Snap raised its full-year infrastructure cost outlook to $1.65 billion-$1.70 billion, primarily to fund additional AI and machine-learning capacity. Q3 revenue is expected to reach $1.70 billion-$1.74 billion, reflecting normalized World Cup-related spending and tougher year-over-year comparisons.
• Management highlighted regulatory and legal risks, including youth-safety scrutiny and several U.S. trials later this year. Potential outcomes could increase compliance and legal costs, require product changes, and negatively affect user growth and engagement.

Snap Stock Performance

SNAP opened at $5.05 on Tuesday. Snap has a 1-year low of $3.81 and a 1-year high of $9.55. The company has a market cap of $8.53 billion, a price-to-earnings ratio of -21.04 and a beta of 1.03. The company’s fifty day moving average price is $4.96 and its two-hundred day moving average price is $5.34. The company has a current ratio of 3.53, a quick ratio of 3.53 and a debt-to-equity ratio of 1.67.

Snap News Roundup

Here are the key news stories impacting Snap this week:

• Positive Sentiment: Snap reported second-quarter revenue of $1.60 billion, up 18.9% year over year and above the $1.54 billion analyst consensus. Its GAAP loss of $0.10 per share was narrower than the expected $0.12 loss, while margins expanded and the company generated positive free cash flow. Snap Inc. Announces Second Quarter 2026 Financial Results
• Positive Sentiment: Management forecast third-quarter revenue of approximately $1.7 billion, broadly in line with expectations but viewed positively alongside the improving advertising trends and stronger-than-expected quarterly performance. Snap’s stock jumps on earnings beat and strong sales forecast
• Positive Sentiment: Higher advertising spending tied to the FIFA World Cup, stronger demand from large North American advertisers and the use of Snap’s AI-powered advertising tools helped drive the quarter and supported the positive outlook. Snap stock jumps as World Cup ads, AI tools drive earnings beat and strong outlook
• Positive Sentiment: Investors also responded favorably to Snap’s comments about rapidly growing direct revenue, improved advertising performance and efforts to build a more durable financial foundation.
• Neutral Sentiment: Unusually high call-option activity before the report indicated elevated speculative interest, but it does not directly change Snap’s underlying business results.
• Neutral Sentiment: CEO Evan Spiegel provided no specific update on pre-order demand for the upcoming Specs smart glasses, leaving a major product catalyst uncertain ahead of the September launch event. Snap CEO sidesteps Specs pre-order questions
• Negative Sentiment: One earnings-data provider reported adjusted earnings of $0.06 per share versus a $0.07 estimate, highlighting that profitability remains inconsistent despite the revenue beat and continued GAAP losses.

Analyst Ratings Changes

Several brokerages recently issued reports on SNAP. Susquehanna reissued a “neutral” rating on shares of Snap in a research note on Tuesday. BNP Paribas Exane lowered shares of Snap to a “neutral” rating in a report on Monday, April 27th. Royal Bank Of Canada cut their price objective on shares of Snap from $10.00 to $8.00 and set a “sector perform” rating on the stock in a research report on Thursday, May 7th. Canaccord Genuity Group reduced their target price on Snap from $7.00 to $6.00 and set a “hold” rating for the company in a research note on Tuesday, April 14th. Finally, Tigress Financial started coverage on Snap in a research report on Monday, April 27th. They issued a “buy” rating for the company. One research analyst has rated the stock with a Strong Buy rating, eight have given a Buy rating, twenty-five have assigned a Hold rating and two have issued a Sell rating to the company’s stock. Based on data from MarketBeat, the stock presently has a consensus rating of “Hold” and a consensus target price of $7.54.

Insider Activity

In other Snap news, insider Ajit Mohan sold 44,785 shares of Snap stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $5.60, for a total transaction of $250,796.00. Following the completion of the transaction, the insider owned 5,057,891 shares in the company, valued at approximately $28,324,189.60. The trade was a 0.88% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO Douglas Hott sold 124,209 shares of the business’s stock in a transaction that occurred on Monday, May 18th. The stock was sold at an average price of $5.60, for a total value of $695,570.40. Following the sale, the chief financial officer directly owned 2,571,149 shares of the company’s stock, valued at $14,398,434.40. This represents a 4.61% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last three months, insiders sold 2,868,059 shares of company stock valued at $15,855,631.

Institutional Inflows and Outflows

Several hedge funds have recently modified their holdings of the stock. Alyeska Investment Group L.P. purchased a new position in Snap in the third quarter valued at approximately $176,697,000. AQR Capital Management LLC increased its position in Snap by 874.3% in the fourth quarter. AQR Capital Management LLC now owns 10,066,852 shares of the company’s stock worth $81,239,000 after buying an additional 9,033,644 shares during the last quarter. Voloridge Investment Management LLC raised its stake in shares of Snap by 53.3% in the third quarter. Voloridge Investment Management LLC now owns 10,300,911 shares of the company’s stock valued at $79,420,000 after buying an additional 3,582,223 shares during the period. Holocene Advisors LP raised its stake in shares of Snap by 895.9% in the third quarter. Holocene Advisors LP now owns 3,560,234 shares of the company’s stock valued at $27,449,000 after buying an additional 3,202,737 shares during the period. Finally, Deutsche Bank AG lifted its position in shares of Snap by 63.8% during the 4th quarter. Deutsche Bank AG now owns 4,799,998 shares of the company’s stock valued at $38,736,000 after buying an additional 1,870,151 shares during the last quarter. Hedge funds and other institutional investors own 47.52% of the company’s stock.

About Snap

Snap Inc is a camera and social media company best known for developing and operating Snapchat, a multimedia messaging application that allows users to send photos, videos and messages that disappear after being viewed. In addition to its core messaging service, Snap offers a suite of augmented reality (AR) tools, including custom Lenses and Filters, that enable users and third-party developers to create interactive and immersive experiences. The company also provides advertising solutions that allow brands to engage audiences through Snap Ads, Sponsored Lenses and Discover content on the platform.

Founded in 2011 by Evan Spiegel and Bobby Murphy, Snap has continually focused on innovation in camera technology and AR.