Snap’s earnings report Thursday, in which it reported its first-ever quarterly profit, sent shares soaring 60% in after-hours trading. The report was a bright spot in a week that contained some disappointments for social media companies, including YouTube’s slowdown in ad revenue growth and Meta Platforms’ drop in users. Snap’s profit comes despite headwinds from Apple’s iOS privacy changes and supply chain disruptions that Snap and other companies say have lowered demand for advertising.
While ads on Snap’s core Stories feature remained its largest driver of revenue, there was a shift by viewers to short-form video content on Spotlight, which competes with TikTok. Meanwhile, the time users spent watching Stories created by friends fell.