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Snap, the parent company of Snapchat, hit $1.06 billion in revenue during the first quarter, falling within its modest forecasts of reaching between $1.03 billion to $1.08 billion in revenue, but swung to a net loss as Apple’s iOS privacy changes continue to impact Snap’s advertising business.
Despite reaching net income for the first time since going public in 2017 in Q4, Snap reported a $359.6 million net loss for its latest quarter. In prepared remarks, Snap CFO Derek Anderson attributed the loss to a “$100 million year-over-year decline in other income, driven primarily by a $92 million unrealized loss on an investment that became public in the second half of 2021.”
Daily active users reached 332 million, up from the 319 million last reported to close out 2021. The company noted it also saw growth in the number of submissions to Spotlight, Snapchat’s TikTok competitor, but did not share any updated figures on the number of users.
“The first quarter of 2022 proved more challenging than we had expected, and our team was able to make significant progress against our goals despite increased volatility in the operating environment,” Snap CEO Evan Spiegel said in prepared remarks published on Thursday. “While we are pleased with our progress given the macroeconomic environment, we also recognize that we have a significant amount of work to do to realize our long-term opportunity.”
Heading into the next quarter, Snap did not disclose a specific revenue target — as it typically does — but forecasted a year-over-year revenue growth between 20 to 25 percent. Anderson said supply chain disruptions, labor shortages, inflation and “the impact of the war in Ukraine on input costs, marketing budgets and overall economic confidence” will have a negative impact on Q2 performance.
Next week, Snap is expected to launch new products at its partner summit on April 28. The company will also host its first in-person NewFronts presentation at Jazz at Lincoln Center on May 3 with Spiegel, chief business officer Jeremi Gorman, chief marketing officer Kenny Mitchell, vp sales Peter Naylor, global director of Arcadia Resh Sidhu and head of original content Vanessa Guthrie.
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