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Snap swung to a third-quarter profit as revenue grew 14% to $1.722 billion, though the top line came in about $10 million shy of what analysts expected, and the shares slid after the report.
Net income reached $56 million, against a $104 million loss a year earlier, with earnings of 3 cents a share. Adjusted EBITDA more than doubled to $383 million from $182 million, operating cash flow was $210 million and free cash flow was $164 million, the company reported Wednesday.
Shares fell about 11% after hours in Seeking Alpha’s 4:14 p.m. ET report.
The audience keeps growing, slowly. Snapchat averaged 495 million daily users in the quarter, up 4% from a year earlier, though its most lucrative market, North America, held flat at 92 million. Snap also said it will switch to monthly users as its headline audience measure starting in early 2027, arguing that better reflects the size of its community.
CEO Evan Spiegel cast the quarter as proof the business model is maturing. “AI is becoming a significant advantage for our teams and advertising platform,” he said, adding that Snap is investing in its “long-term vision for augmented reality with the launch of SPECS,” its coming smart-glasses line. Those are his claims; the AI investments have yet to show up as faster revenue growth.
For the half a billion people who open Snapchat every day, mostly to message friends, the quarter means the company behind the app is finally making more money than it spends while it bets on glasses as the next big thing.
JBizNews Desk | Santa Monica
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