Snap (NYSE:SNAP) Shares Gap Down on Disappointing Earnings

Key Points

• Snap reported EPS of ($0.05 loss) versus a consensus of $0.09, missing by $0.14; shares gapped down (closed $6.11, opened $5.67) on heavy volume even as revenue was $1.53B, up 12.2% year‑over‑year.
• The planned $400M partnership with Perplexity was amicably ended and explicitly excluded from Q2 guidance, and management issued cautious guidance citing regional geopolitical uncertainty.
• Activist investor Randian Capital is pressing for an asset review and board changes, adding execution and governance risk while analysts remain mixed (MarketBeat consensus: Hold, $7.93 target).

Snap Inc. (NYSE:SNAP - Get Free Report) gapped down before the market opened on Thursday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $6.11, but opened at $5.67. Snap shares last traded at $6.1180, with a volume of 30,299,627 shares trading hands.

The company reported ($0.05) earnings per share (EPS) for the quarter, missing the consensus estimate of $0.09 by ($0.14). Snap had a negative net margin of 7.76% and a negative return on equity of 20.72%. The company had revenue of $1.53 billion for the quarter, compared to analysts' expectations of $1.53 billion. During the same quarter in the prior year, the firm earned ($0.08) EPS. Snap's quarterly revenue was up 12.2% compared to the same quarter last year.

Trending Headlines about Snap

Here are the key news stories impacting Snap this week:

• Positive Sentiment: Q1 revenue grew ~12% and daily active users returned to growth, driven by markets outside North America/Europe — evidence of resilient ad demand and user momentum. Snap's quarterly revenue rises, daily active users return to growth
• Positive Sentiment: Some outlets report Snap beat or matched top-line expectations (and internal materials/slides were released), showing underlying ad demand may be steadier than headlines imply. Snap (SNAP) Q1 Earnings and Revenues Surpass Estimates
• Neutral Sentiment: Earnings interpretation is mixed across outlets — some note an EPS miss vs. consensus while others report beats; investors should check company filings/call for the final accounting detail. Snap Q1 earnings details (MarketBeat)
• Neutral Sentiment: Large options activity (heavy call buying) suggests speculative bullish interest even amid the pullback — could amplify intraday moves.
• Negative Sentiment: Snap and Perplexity amicably ended their planned integration; the lost $400M partnership removes an expected AI monetization catalyst and was explicitly excluded from Q2 guidance. Snap says its $400M deal with Perplexity ‘amicably ended’
• Negative Sentiment: Randian Capital’s activist campaign is pressing for an asset review (Specs Inc.) and board changes; activism increases execution and governance uncertainty and could trigger strategic reviews or divestiture speculation. Randian Activist Push Puts Snap Specs Review And Valuation In Focus
• Negative Sentiment: Snap issued cautious Q2 revenue guidance that assumes no contribution from Perplexity and flagged regional geopolitical uncertainty — a near-term headwind for sentiment. Snap issues cautious guidance as Perplexity deal ends, Middle East 'geopolitical situation' causes uncertainty

Analyst Ratings Changes

SNAP has been the subject of a number of recent analyst reports. The Goldman Sachs Group lowered shares of Snap from a "neutral" rating to a "neutral" rating in a research report on Monday, April 27th. Rothschild & Co Redburn upgraded shares of Snap from a "neutral" rating to a "buy" rating and set a $10.00 price target for the company in a research report on Monday, April 27th. TD Cowen started coverage on shares of Snap in a report on Monday, April 27th. They issued a "buy" rating on the stock. Evercore reaffirmed a "mixed" rating on shares of Snap in a report on Thursday, February 5th. Finally, Stifel Nicolaus increased their price target on Snap from $4.50 to $5.25 and gave the company a "hold" rating in a research note on Tuesday, April 21st. One investment analyst has rated the stock with a Strong Buy rating, eleven have given a Buy rating, twenty have issued a Hold rating and two have assigned a Sell rating to the company. Based on data from MarketBeat.com, the company has a consensus rating of "Hold" and a consensus target price of $7.93.

Insiders Place Their Bets

In other news, CAO Rebecca Morrow sold 16,499 shares of the stock in a transaction on Tuesday, February 17th. The shares were sold at an average price of $4.70, for a total value of $77,545.30. Following the sale, the chief accounting officer owned 466,682 shares of the company's stock, valued at approximately $2,193,405.40. This represents a 3.41% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which can be accessed through this link. Also, insider Ajit Mohan sold 28,058 shares of the stock in a transaction dated Thursday, April 16th. The stock was sold at an average price of $6.02, for a total transaction of $168,909.16. Following the transaction, the insider owned 5,102,676 shares in the company, valued at approximately $30,718,109.52. The trade was a 0.55% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last quarter, insiders have sold 2,565,573 shares of company stock valued at $13,329,781. 22.68% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Snap

Institutional investors have recently added to or reduced their stakes in the stock. Alyeska Investment Group L.P. acquired a new stake in Snap during the 3rd quarter worth $176,697,000. AQR Capital Management LLC boosted its position in shares of Snap by 874.3% during the 4th quarter. AQR Capital Management LLC now owns 10,066,852 shares of the company's stock valued at $81,239,000 after acquiring an additional 9,033,644 shares during the last quarter. Junto Capital Management LP acquired a new position in shares of Snap during the 3rd quarter valued at about $29,071,000. Voloridge Investment Management LLC boosted its position in shares of Snap by 53.3% during the 3rd quarter. Voloridge Investment Management LLC now owns 10,300,911 shares of the company's stock valued at $79,420,000 after acquiring an additional 3,582,223 shares during the last quarter. Finally, Assenagon Asset Management S.A. boosted its position in shares of Snap by 537.9% during the 4th quarter. Assenagon Asset Management S.A. now owns 4,150,134 shares of the company's stock valued at $33,492,000 after acquiring an additional 3,499,578 shares during the last quarter. Institutional investors and hedge funds own 47.52% of the company's stock.

Snap Stock Performance

The firm's 50-day moving average price is $5.12 and its two-hundred day moving average price is $6.59. The company has a debt-to-equity ratio of 1.53, a quick ratio of 3.56 and a current ratio of 3.56. The stock has a market cap of $10.41 billion, a price-to-earnings ratio of -22.61 and a beta of 1.05.

About Snap

Snap Inc is a camera and social media company best known for developing and operating Snapchat, a multimedia messaging application that allows users to send photos, videos and messages that disappear after being viewed. In addition to its core messaging service, Snap offers a suite of augmented reality (AR) tools, including custom Lenses and Filters, that enable users and third-party developers to create interactive and immersive experiences. The company also provides advertising solutions that allow brands to engage audiences through Snap Ads, Sponsored Lenses and Discover content on the platform.

Founded in 2011 by Evan Spiegel and Bobby Murphy, Snap has continually focused on innovation in camera technology and AR.

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