For the fifth quarter in a row, SNAP stock craters after the company reports devastating earnings. But this one really hurts, because by now even the bears expected that all the bad news had been flushed out. Boy, were they wrong.
Having plunged six months ago after projecting its worst revenue growth on record, a shock revelation which took the stock some 25% lower, and tumbling again three months ago ago when the company reported another ugly quarter, SNAP is down double digits once again, tumbling from the mid-$11s to just below $10 after the former "growth" company forecast its first ever revenue decline.
Which is not to say that its historical data was any good. Here is how the company did in yet another catastrophic quarter:
Tragically, in a time when tech companies are firing everyone, SNAP still uses the same colorblind graphic designer.
Of course, with (just barely) more users than expected yet missing on revenue, it meant just one thing: the monetization disappointed and sure enough, ARPU of $3.47, was not only 15% lower vs 2021, but missed estimates of $3.49
But while historical data was bad, it's what the company disclosed about the present and, worse, the future that shocked markets: specifically, while the company disappointed quarter-to-date revenue is already down about 7% Y/Y, the final straw before everyone hit the sell button is that the company's forecast assumes revenue will decline between -10% to -2% in the first quarter.
Not only is that below the average analyst estimate for growth of 1.48%, but it is Snapchat's first every quarterly negative revenue guidance.
Knowing that its stock would soon be in the single digits, it barely tried to put lipstick on a pig and instead just gave token lip service to Q1 guidance, saying that "given the work we have completed to reprioritize our cash cost structure, we believe we have a path to adjusted EBITDA breakeven in Q1."
Whatever. Meanwhile, the company is now a melting ice cube, and the stock reflects it with SNAP plunging back into the single digits after hours.
