Q4 2024 Snap Inc Earnings Call Transcript
Key Points
- Snap Inc (SNAP) reported a 14% year-over-year increase in Q4 revenue, reaching $1.56 billion, driven by growth in direct response advertising and Snapchat Plus subscriptions.
- Daily active users grew to 453 million in Q4, marking an increase of 39 million year-over-year, with notable growth in the Rest of World segment.
- Snapchat Plus subscribers doubled from 7 million to 14 million in 2024, contributing significantly to revenue growth with a 131% year-over-year increase in other revenue.
- The company achieved $276 million in adjusted EBITDA for Q4, reflecting improved profitability and a 60% adjusted EBITDA flow-through.
- Snap Inc (SNAP) continues to innovate with new ad placements like sponsored Snaps and promoted places, which have shown promising early results in increasing advertiser reach.
- Brand-oriented advertising revenue declined by 1% year-over-year, indicating continued weakness among large clients, particularly in North America.
- The company faces challenges in migrating story ad demand to new formats, impacting engagement with certain user cohorts who prefer the traditional stories page.
- Infrastructure costs increased due to investments in machine learning and AI, with costs per daily active user remaining a concern.
- Legal costs, including litigation and regulatory compliance, are expected to rise, contributing to higher adjusted operating expenses.
- Despite growth in active advertisers, the ramp-up period for new advertisers to reach full revenue potential remains a challenge, impacting overall revenue growth.
Good afternoon, everyone and welcome to Snap Inc.'s fourth-quarter 2024 earnings conference call. (Operator Instructions)
I would now like to turn the call over to David Ometer, Head of Investor Relations.
Thank you and good afternoon, everyone. Welcome to Snap's fourth-quarter 2024 earnings conference call. With us today are Evan Spiegel, Chief Executive Officer and Co-Founder; and Derek Anderson, Chief Financial Officer.
Please refer to our Investor Relations website at investor.snap.com to find today's press release earnings slides, investor letter, and investor presentation. This conference call includes forward-looking statements which are based on our assumptions as of today.
Actual results may differ materially from those expressed in these forward-looking statements and we make no obligation to update our disclosures. For more information about factors that may cause actual results to differ materially from these forward-looking statements, please refer to the press release
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