SNAP Q3 2024 Earnings

Call Details

• Call Title: Snap Q3 2024 Earnings Call
• Date: October 29, 2024 at 9:00 PM UTC
• Management Team:
  • Evan Spiegel (Chief Executive Officer and Co-Founder)
  • Derek Andersen (Chief Financial Officer)
  • David Ometer (Head of Investor Relations)

Call Summary

Financial Performance

• Daily active users reached 443 million in Q3, which was an increase of 37 million year-over-year and 11 million quarter-over-quarter.
• Total revenue was $1.37B in Q3, up 15% year-over-year and up 11% quarter-over-quarter.
• Advertising revenue was $1.25B in Q3, up 10% year-over-year, while other revenue more than doubled year-over-year to $123M.
• Adjusted cost of revenue was $637M in Q3, up 16% year-over-year, with infrastructure costs cited as the largest driver of the increase.
• Adjusted operating expenses were $604M in Q3, up 1% year-over-year, with personnel costs down 9% year-over-year and full-time headcount down 11% year-over-year.
• Adjusted EBITDA was $132M in Q3 compared to $40M in Q3 of the prior year, and adjusted EBITDA flow-through was 50% of incremental year-over-year revenue.
• Net loss was $153M in Q3 versus a net loss of $368M in Q3 of the prior year, representing a $215M (58%) improvement year-over-year.
• Free cash flow was $72M in Q3 and operating cash flow was $116M in Q3, with trailing 12-month free cash flow of $147M and trailing 12-month operating cash flow of $347M.

Guidance

• Q4 DAU guidance is approximately 451 million, which the company used as a base assumption for Q4 revenue guidance.
• Q4 revenue guidance range is $1.51B to $1.56B, implying year-over-year growth of 11% to 15%.
• Q4 adjusted EBITDA is estimated to be between $210M and $260M based on the provided revenue range and cost outlook.
• Infrastructure cost guidance remains $0.83 to $0.85 per DAU per quarter and the company expects to be near the top end of this range in Q4.
• Other cost of revenue guidance remains 19% to 21% of revenue and the company expects to be within this range in Q4 after coming in at the low end in Q3.
• Adjusted operating expenses full year guidance remains $2.425B to $2.525B and the company expects to be near the low end of that range for the full year.
• Full year stock-based compensation guidance was $1.13B to $1.2B and the company now expects to come in 4% to 5% below the low end of that range.