SNAP earnings call: key takeaways

• SNAP reported revenue of $1.72 billion for Q3 2026, which met the consensus estimate of $1.72 billion (1:42)
• The company also expanded margins and generated positive net income (1:42)
• The main message of the call was focused on growth in advertising, improvements in AI, and the introduction of new products like Specs. (1:42)

Results vs expectations

What changed since last quarter

• The company raised its Q4 revenue guidance to $1.950 billion to $1.985 billion, up from previous expectations. (13:20)
• The guidance for adjusted EBITDA was set at $490 million to $525 million for Q4. (13:20)
• The company announced a shift in audience metrics from daily active users to monthly active users, emphasizing long-term value over daily engagement. (15:00)

Guidance

What analysts pressed on

• Whether the shift away from daily active users would negatively impact time spent and ad revenue. (27:06)
• How the decline in brand advertising would affect overall growth and when direct response advertising would overcome this pressure. (26:02)

In their words

• We delivered substantial operating leverage, with approximately 93% of incremental revenue flowing through to adjusted EBITDA. Evan (3:22)
• We're seeing very positive signs of growth from diversified verticals like financial services in the U.S. Ronan Harris (17:44)
• Specs represent a totally new computing paradigm, so it's really, really important for people to try them to understand the value. (18:40)
• We're focused on three things. How many people we serve? How effectively we monetize that community and how that translates into free cash flow per share. Douglas Hott (20:21)