Snap Q1 earnings report 2023

Co-founder and CEO of Snap Inc. Evan Spiegel holds up a Pixy drone while speaking during the Viva Technology conference dedicated to innovation and startups, at the Porte de Versailles exhibition center in Paris, France June 17, 2022.

Benoit Tessier | Reuters

Snap shares dropped 20% after hours on Thursday as the company reported first quarter results that missed analysts’ expectations on revenue.

Here’s how the company did:

  • Earnings per share: 1 cent, adjusted, versus a loss of 1 cent expected, according to a Refinitiv survey of analysts, according to a Refinitiv survey of analysts
  • Revenue: $989 million versus $1.01 billion expected, according to Refinitiv
  • Global Daily Active Users (DAUs): 383 million versus 384 million expected, according to StreetAccount
  • Average revenue per user: $2.58 versus $2.63 expected, according to StreetAccount

Although the company didn’t provide official guidance for the second quarter, it said in a letter to shareholders that its “internal forecast” for Q2 revenue would be $1.04 billion, representing a 6% year-over-year decline. Analysts were estimating that second-quarter sales projections would be $1.10 billion.

Like much larger rivals, including Facebook and Google, Snap continues to operate in a difficult online advertising market in which companies have reduced their marketing and promotional spend as the economy remains shaky.

But unlike those giant rivals, Snap doesn’t have the enormous presence around the world to help manage the difficult digital ad sector more smoothly.

For instance, Meta suffered three straight quarters of shrinking sales, but reported a 3% year-over-year growth of $28.65 billion during the first quarter, thanks in part to Chinese companies spending a lot of money on Facebook to show ads to people around the world.

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