Snap shows growth with its first quarterly net profit

Snap, the parent company of disappearing messaging app Snapchat, said Thursday it posted its first ever quarterly net profit. 

The company’s stock jumped more than 40% to $34.15 per share in after-hours trading. Snap’s fourth quarter earnings report comes a day after Facebook, which renamed itself Meta reported fourth-quarter earnings that fell short of expectations. The amount of daily active users on Facebook also dropped for the first time. Facebook’s performance dragged down other social media stocks including Snap. Earlier on Thursday, Snap’s stock closed down 24% at $24.50 per share.

Snap’s earnings and revenue didn’t disappoint. Like other social networks, though, Snap also expected Apple’s privacy changes to impact its ad business. 

Snap reported revenue of $1.3 billion in the last three months of 2021, beating Wall Street’s expectations of $1.2 billion in revenue. The company earned 22 cents per share, above estimates of 10 cents per share. About 319 million people logged into Snapchat daily, an uptick of 20% compared to the same period last year. 

Snapchat has been investing more in augmented reality, which allows users to overlay a virtual image onto their view of the real world. Users are able to try out clothing, glasses and other accessories using AR. The company also teamed up with Universal to host a virtual concert with celebrity Jennifer Lopez and Colombian pop singer Malum on Thursday evening.