Snap Inc.'s Share Price Soars After Revenue Beats Expectations

Snap Inc.'s Share Price Soars After Revenue Beats Expectations

In 2017, the year it went public, Snap recorded a stock-based compensation expense of $2.6 billion, accounting for 77 percent of its net loss and more than three times the amount it generated in revenue. Snap added almost 9 million daily active users in the last quarter, the most since the third quarter of 2016, pumping its daily user base to 187 million. Twitter's expense of $600 million in 2013 was slightly less than its revenue, while LinkedIn had just a $30 million expense and $522 million in sales in 2011, the year it debuted on the market. Revenue per user rose 46 percent from a year earlier to $1.53, while cost of revenue per user rose 5 percent to $1.02.

The company has also suffered from unfavorable comparisons to Facebook Inc.'s Instagram, which is rapidly expanding and aggressively copying Snapchat's most-popular features. Snap's net income losses for the quarter were $350 million, double a year ago.

SEE ALSO: Snapchat opens Snap Store in app.

The redesign has been rolled out to about 40 million users so far, according to Spiegel, with plans to expand it to all users by the end of the first quarter.

The announcement late past year that Snap meant to completely rebuild the Snapchat app has been welcomed by frustrated users.

Classes Back In Session After Accidental Shooting At LA Middle School
Police have not said where the girl go the semi-automatic handgun or why she brought it to the downtown campus. The teenage boy was shot in the head and was in stable but critical condition at an area hospital.

"Our work during 2017 is proof that we aren't afraid to make big changes for the long-term success of our business", Evan Spiegel, the cofounder and CEO of Snap, said in a statement.

Snapchat has sought to distinguish itself from Facebook with a design that "separates social from media", according to Spiegel, who said this helps avoid "many of the problems that arise when friends are commingled with professional content creators".

"Our business really came together towards the end of past year", Chief Executive Officer Evan Spiegel said in a statement. (One year earlier, it had added 10 million in the same quarter.) Wall Street expects Snapchat added six million new users in Q4.

Following the Snap Inc (SNAP) earnings release, the company's stock skyrocketed in after-hours trade, climbing by more than 20% to as high as $17.80 as investors were undoubtedly cheerful about the beat on user adds.

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