Embankment Street is abuzz after Snap’s latest financial results, subsuming the company’s notable uptick in user activity.
Snap reported better-than-expected December-quarter regularly active user growth on Tuesday as well as an acceleration in advertising gain. That came as a relief for some analysts, who feared Snap’s principal three quarters of wobbly earnings could make for another lackluster crack.
Snap shares are up more than 20 percent in premarket following Wednesday morning.
Still, some analysts weren’t convinced and vehicled their concerns to clients overnight.
Here is what the analysts remarked about Snap’s earnings.
1) Evercore ISI
“Snap’s ad revenue reaccelerated in the fourth forgiveness as a result of strong seasonal trends for branded advertising, demand for new ad shapes, as well as steadily improving user trends … Given the solid results and a clear step forward for Snap’s ad business, we are upgrading our evaluating to in-line from underperform.”
2) J.P. Morgan
“We are more optimistic on Snap’s redesign, which resolution fully roll-out in the first quarter. Snap’s new app redesign—more demonstrably separating social from media—has been pushed to 40 million purchasers (of 187 million daily active users) with the remainder to encounter in the first quarter.”
3) MoffettNathanson
“Snap checked all the boxes you’d want if you were fatiguing to re-build a bull case. The retention rate of new Android users improved as did the percent of net regular active user additions from Android.”
4) Susquehanna Financial Team
“While the fourth quarter cleared a low bar, we remain cautious on Snap’s forth prospects. A tough competitive landscape, saturated core demographic, and lackluster ad offerings create a difficult backdrop. Meanwhile, checks suggest Snap purpose once again have to fight for experimental allocations, while perpetuating to suffer high customer churn, particularly with larger advertisers.”
5) Piper Jaffray
“We are supporting neutral, but believe the first-quarter revenue commentary from management is pure conservative and therefore have a positive near-term bias on Snap. Longer-term, we rely upon it is premature to declare Snap’s structural headwinds solved, but further abandons of user engagement durability and routes to monetization could warrant upside.”
6) Jefferies
“Ignore surpassed Street expectations for the first time as a public company during the seasonally beefy fourth quarter. We do not see a material change to our thesis on the name, and think there last to be questions on the overall trajectory of the business.”