Snap is the parent company of Snapchat. Snapchat is one of the most popular social media options in the world. Over the past few years, millions of people have joined the social media service. Last year, Snap went public in an attempt to raise additional funding for growth. The company has disappointed investors since going public. Not only has the stock price declined, but daily active users have also decreased. The company’s CEO is also the founder of the company. He promised investors that he would turn around the company and make Snapchat profitable.
Earnings Call
On the latest earnings call with investors, the company had higher earnings than most investment analysts projected. As a result, the stock price of the company increased drastically after the earnings announcement. The earnings call surprised the vast majority of investment professionals.
Advertising
Social media companies make money through advertising. In the past, Snapchat has struggled to gain advertising sales from clients. However, based on the latest earnings call, that is starting to change. Not only did sales increase last quarter, but the number of daily active users also increased. All of these metrics indicate that the company is executing the right plan for the future.
Hiring Executives
Multiple executives at the company have left in recent months. Some people speculate that the company is facing various internal problems. When the CFO of a company leaves, it usually indicates additional issues that could arise in the coming months.
The CEO of the company has assured investors that nothing is wrong internally at Snapchat. He blames the employee turnover on differences in management style.
Although Snapchat has struggled to be profitable recently, the latest quarter offers a glimmer of hope for investors. Anyone who wants to invest in a social media business should consider this company.
Dil Bole Oberoi
