Snap Inc. posted higher-than-projected quarterly sales and gave an upbeat forecast for the current period, signaling optimism ahead of the September commercial debut of its first pair of augmented reality glasses. <\/p>\n
The Santa Monica company\u2019s Revenue jumped 19% to $1.6 billion for the quarter ended June 30, beating analysts\u2019 average estimate of $1.54 billion. Advertising revenue, which makes up the bulk of Snap\u2019s sales, grew 9% to $1.28 billion.<\/p>\n
Snap, which owns the Snapchat messaging app, projected third-quarter sales of as much as $1.74 billion, topping projections for $1.70 billion, according to data compiled by Bloomberg. Shares of the Santa Monica, California-based company jumped as much as 12% in extended trading after closing at $5.04 in New York. The stock has dropped more than 37% so far this year. <\/p>\n
Snap warned earlier this year that its advertising business would be negatively impacted by the ongoing war in the Middle East \u2014 a prospect that hurt the stock after earnings were released in May. The company didn\u2019t mention the conflict in a letter to shareholders Monday. <\/p>\n
While Snap\u2019s sales are improving, the company has struggled to win over investors in recent years due to an inconsistent advertising business that has been hit by various issues, including technical glitches and the impact of global affairs. Chief Executive Officer Evan Spiegel is hopeful that the company\u2019s upcoming AR glasses will give Snap a boost, and put the company in a more central position in the tech industry\u2019s rapidly changing AI race. <\/p>\n
Many of Snap\u2019s larger tech peers, including Meta Platforms Inc. and Alphabet Inc.\u2019s Google, are spending tens of billions on state-of-the-art artificial intelligence models and related infrastructure \u2014 a bet that is transforming the social media landscape and spooking investors concerned about overspending. But Spiegel has taken a different approach to the AI boom, spending money to develop AI-powered glasses, known as Specs, instead of AI models and data centers. The glasses enterprise was spun out as a standalone subsidiary back in January. <\/p>\n
Spiegel called the upcoming glasses \u201cour largest long-term opportunity\u201d in Monday\u2019s shareholder letter, and believes they will help Snap tap into a new audience since people won\u2019t need a Snapchat account to use them. Some investors, though, expressed skepticism on a conference call Monday that Specs will break through in a crowded industry where some of the company\u2019s competitors, like Meta, have a lot more resources. They also pressed Spiegel on whether there are limits to how much he might invest in the product.<\/p>\n
\u201cThe long-term opportunity to develop the next computing platform is absolutely enormous,\u201d Spiegel said on the call. He pointed out that Snapchat launched into a crowded social media industry, and still found success. \u201cWhat\u2019s so unique about this opportunity for us is really that we\u2019re a first mover,\u201d Spiegel added. He said that technology like Specs won\u2019t likely be widely adopted until the end of the decade, adding that \u201cwe are really approaching this investment with a lot of discipline.\u201d<\/p>\n
In April, Snap announced it was laying off 16% of its workforce as part of an effort to reduce costs and achieve profitability. It also cited AI advances that have allowed Snap employees to be more nimble. The savings from those job cuts, which Snap previously said would reduce its annualized cost base by more than $500 million, \u201care expected to be more fully reflected in Q3 and beyond,\u201d according to prepared remarks from new Chief Financial Officer Doug Hott. <\/p>\n
After posting its first user decline in years at the end of 2025, Snap reported strong audience growth over the first six months of 2026. It had 493 million daily active users through the period ending in June, up from 483 million the prior quarter. That surpassed analysts\u2019 expectations of 488 million users. Snap\u2019s US audience also grew quarter-over-quarter, Spiegel said, led by people age 35 and older.<\/p>\n
Still, Snap warned of a challenging regulatory and legal environment in the US and abroad. A growing number of countries around the world are eyeing sweeping social media bans for teens. After Australia became the first to ban a range of apps, including Snapchat, for those under 16 in December, several other countries have proposed similar restrictions. Last month, France became the first European Union member to ban social media for young teenagers. <\/p>\n
In the U.S., Snap\u2019s most valuable market, the company is also mired in broad litigation alleging that top social media companies have knowingly hooked and harmed minors with their products. Thousands of individuals and US school districts are suing Snap and its rivals. Snap has so far settled claims in three closely watched cases this year, but still faces several other trials scheduled in 2026. Hott told investors the landscape \u201ccould materially impact our business and financial results,\u201d a sentiment Spiegel echoed on the company\u2019s earnings call with investors Monday. <\/p>\n
\u201cWe are closely monitoring the regulatory environment,\u201d he said, \u201cincluding age assurance, privacy and online safety requirements, which may affect the product experience or our user growth and engagement over time.\u201d<\/p>\n
Snap\u2019s strong advertising results were driven in part by larger advertisers in North America, the company said. Snap\u2019s \u201cother revenue\u201d also grew 85% in the second quarter to $316 million. That category encompasses subscription products that have helped Snap decrease reliance on advertising, including its consumer subscription Snapchat+ and an upgraded Memories storage plan that charges users to store some images and videos.<\/p>\n
Levine writes for Bloomberg. <\/p>\n","protected":false},"excerpt":{"rendered":"Snap Inc. posted higher-than-projected quarterly sales and gave an upbeat forecast for the current period, signaling optimism ahead…\n","protected":false},"author":2,"featured_media":558771,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[274827,274826,274828,5933,4486,111,139,69,5202,4460,274829,5316,5317,267228,3332,197980,145,74674,379],"class_list":["post-558770","post","type-post","status-publish","format-standard","has-post-thumbnail","category-technology","tag-ar-glass","tag-california-based-company","tag-crowded-ai-race","tag-investor","tag-month","tag-new-zealand","tag-newzealand","tag-nz","tag-part","tag-product","tag-quarterly-sale","tag-snap","tag-snapchat","tag-social-medium-landscape","tag-specs","tag-spiegel","tag-technology","tag-user","tag-year"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/558770","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=558770"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/558770\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/558771"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=558770"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=558770"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=558770"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}