Snap reported advertising revenue up 10% to $1.13 billion in the June quarter as brands using its platform increased.
“Our community grew to reach more than 850 million monthly active users in Q2, with more than 11 million Snapchat+ subscribers,” said CEO Evan Spiegel, CEO.
“We continued to scale our advertising platform with active advertisers more than doubling year-over-year.”
Total revenue grew 16% to $US1.237 billion in the June quarter and Snap now has more than 850 million monthly active users.
Average revenue per user was $2.86, up from $2.69 in the same three months last year..
Snap expects revenue in the range of $1.335 billion to $1.375 billion for the September quarter and full year of 12% to 16%.
“The growth of our community, the progress we have made with our direct-response (DR) advertising business, and the success of our Snapchat+ subscription business that now reaches more than 11 million subscribers, all contributed to total revenue growing 16%,” Snap said.
This was despite the impact of a weaker brand advertising environment for some consumer discretionary verticals.
Investors marked Snap down in after hours trading, with its shares down more than 18% to $10.40.
Emarketer principal analyst Jasmine Enberg said Snap can’t seem to hold on to investors’ favour for long.
"Despite strong growth in Snapchat+ subscribers, investors weren’t happy with the weaker growth in its core ad business, especially given the impressive growth in the number of active advertisers," he said.
"Light Q3 guidance doesn’t help soothe their concerns. Snap faces tough competition from its much larger rival Meta, which investors rewarded for its strong ad business performance yesterday."
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