operating margin
—
FY 2025
official guidance
SNAP INC.
Last · NYSE$6.10-0.39 (-6.01%)close · yahoo · 12h ago
Market cap$10.32B1.44B sh
P/E · TTM-33.9fwd 7.8 · eps -0.18 · loss
Beta1.08vs S&P 500
Div yield0.00%annual · TTM
52w range
$3.81$9.13
Volume43.5Msession
| Revenue | $5.9B |
|---|---|
| Operating income | $-532.2M |
| Net income | $-460.5M |
| Free cash flow | $437.2M |
| Operating margin | -9.0% |
| Net margin | -7.8% |
| Return on equity | -20.2% |
| Period | 2025 |
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OpenFilings analyst
Our analyst
Agentic read of the latest earnings call — recommendation updates when we process a new transcript. Research synthesis, not investment advice.
Strong BuyBuyHoldSellStrong Sell
Strong execution is offset by poor near-term visibility and unresolved user-growth and competitive risks.
Hold: Snap delivered a strong Q1, with revenue at the high end of guidance, active advertisers up 60%, direct-response advertising at 75% of ad revenue, and North American revenue growth accelerating to 12%. However, Q2 is still growing but facing unidentified macro headwinds, including de minimis-related advertiser pullbacks, while management withdrew quarterly guidance and could not quantify exposure or the path to its 20%+ DR growth ambition from roughly 14%.
Themes
- Q2 Macro Headwinds
- Direct Response Advertising
- Smb Advertisers
- Sponsored Snaps
- North America Dau
- Snapchat Plus
Near term
Q2 macro conditions and advertiser spending trends are the primary stock catalyst; management said growth remains positive but has slowed and declined to provide formal guidance.
De minimis changes have affected spending from some advertisers, but management would not quantify the impact or separate it from other macro drivers.
Sponsored Snaps are expanding ad inventory; additional goal-based bidding objectives and model training are expected in coming months.
North American DAU fell to 99 million sequentially, although management does not expect further Q2 declines; evidence of a sustained reacceleration is still limited.
The company lowered full-year adjusted operating expense expectations by approximately $50 million at the midpoint and stock-based compensation expectations by $30 million, supporting flow-through but signaling a more cautious investment posture.
Longer term
Ad-platform improvements—larger and fresher models, six-times faster model learning, more than five-times the historical interaction data, improved app-conversion optimization, and CAPI adoption—are producing better direct-response outcomes; sustained gains must be demonstrated through weaker macro conditions.
SMB and midsize advertiser expansion remains the core growth strategy, with Snap Promote intended to simplify onboarding and transition advertisers toward Ads Manager. The key test is whether new advertisers scale spending rather than merely expand advertiser counts.
Snapchat+ reached approximately $600 million annualized revenue and nearly 15 million subscribers, adding diversification and potential pricing/ARPU upside, but its resilience in a downturn remains untested.
Spotlight has more than 500 million monthly active users and view time grew approximately 25% year over year in Q1, offering a potentially valuable engagement and monetization surface.
My AI and augmented-reality interfaces provide long-term product optionality, but the call supplied no evidence that Snap has a differentiated or economically meaningful position versus larger AI platforms.
Red flags
Management repeatedly declined to quantify Q2 advertising growth, China-based advertiser exposure, category exposure, or the specific causes of the slowdown, leaving earnings visibility unusually weak.
The North American user base remains effectively stagnant near 100 million DAUs and declined to 99 million in Q1; management's confidence that declines will stop is not the same as demonstrated growth.
Management described a path from approximately 14% DR growth to 20%+ based on future platform, product, Sponsored Snap, and go-to-market improvements, but provided no timing or quantified milestones.
Competitive pressure in AI-based campaign optimization was met with a broad reference to existing technology and investor-relations materials rather than a clear product or performance comparison.
The shift toward high-yield debt avoids dilution but introduces coupon and balance-sheet risk if advertising volatility persists; the call did not quantify the resulting leverage burden.
Product redesign efforts remain unsettled: Snap abandoned the three-tab approach for a modified five-tab experience after power-user resistance, creating execution and monetization-transition risk.
Forward outlook
OpenFilings analyst view from primary-source filings and earnings calls — not investment advice.
From latest 10-K · 2026-02-05
- Net Margin Sharply Negative
- Sbc Revenue Elevated
- Accumulated Deficit High
Red flags
- Net Margin Sharply Negative — Net margin -7.8%
- Sbc Revenue Elevated — SBC/Revenue 17.1%
- Accumulated Deficit High — Accumulated deficit / equity 611%
Upcoming earnings
9:00 PM UTC+1
Period
Sep 2026
Est. EPS
$0.00
Est. revenue
1.7B
Earnings transcripts
- Motley Fool
Snap (SNAP) Q2 2026 Earnings Call Transcript
SNAP INC.
- Issuer webcast
Q2 2026 earnings call transcript
SNAP INC.
- Issuer IR
Q2 2026 earnings call transcript
SNAP INC.
- Issuer IR
Earnings Call & Follow Up Call Transcript
SNAP INC.
- Issuer IR
Follow Up Call Transcript
SNAP INC.
- Issuer IR
Q3 2023 earnings call transcript
SNAP INC.