SNAP earnings for the first quarter of 2024

• Earnings per share: 3 cents was revised against a loss of 5 cents expected by LSEG
• he won: $1.19 billion versus $1.12 billion expected by LSEG
• Global daily active users: 422 million vs. 420 million expected, according to StreetAccount
• Average revenue per user: $2.83 versus $2.67 expected, according to StreetAccount

Snap's first-quarter revenue rose 21% from $989 million in the same period last year. The company is growing at an accelerating pace, having previously reported six consecutive quarters of single-digit growth or declining sales.

Snap has been rebuilding its advertising business after the digital ad market faltered in 2022, and it's starting to pay off. In its investor letter, Snap said its revenue growth was primarily driven by improvements in the company's advertising platform, as well as demand for its direct response advertising solutions.

Advertising revenue was $1.11 billion in the first quarter. Snap's “other revenue” category, which is primarily led by Snapchat+ subscribers, reached $87 million, an increase of 194% year over year. Snap reported over 9 million Snapchat+ subscribers for the period.

Adjusted EBITDA for the first quarter was $46 million, far exceeding the $68 million loss that analysts had expected, according to StreetAccount. Adjusted EBITDA “exceeded our expectations” and was primarily driven by operating expense discipline, as well as accelerating revenue growth, Snap said in its letter to investors.

“Given the progress we have made on our advertising platform, the leadership team we have built, and the strategic priorities we have identified, we believe we are well positioned to continue improving the performance of our business,” Snap wrote in the letter.

Although Snap's growth has accelerated, it still lags behind Meta, which reported 27% growth in better-than-expected first-quarter results on Wednesday. Meta shares fell anyway after the company issued a light forecast and stunned investors with talk of its long-term investments.

Snap's net loss for the quarter narrowed to $305.1 million, or a loss of 19 cents per share, from $328.7 million, or a loss of 21 cents per share, a year earlier.

In the second quarter, Snap expects to report revenue between $1.23 billion and $1.26 billion, up from the $1.22 billion analysts expected, according to StreetAccount. Snap said adjusted EBITDA will fall between $15 million and $45 million, compared to Wall Street's forecast of $15.5 million.

Snap reported 422 million daily active users (DAUs) in the first quarter, up 10% year over year. The company expects to report about 431 million DAUs in the second quarter, up from the 430 million expected by StreetAccount.

The company also provided a forecast of its cost structure for the full year 2024. Snap said its quarterly infrastructure costs per daily user will fall between 83 cents and 85 cents for the rest of the year.

“We will continue to evaluate our infrastructure investment levels based on what is in the long-term best interest of our business,” Snap said.

Snap said the amount of time users spend watching content has increased year over year, primarily due to engagement with Spotlight and Creator Stories. The company said time spent watching Spotlight, which collects content from users, increased 125% year-over-year.

In February, Snap announced it would lay off 10% of its global workforce, or about 500 employees. Headcount and staff costs “will grow modestly” through the rest of the year, the company said Thursday.

Snap will hold its quarterly call with investors at 5:30 PM ET on Thursday.