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Snap Inc. Earnings Sag: Time for a Turnaround?

Ellis HobbsAvatar
Written by Ellis Hobbs Reviewed by Jack Kellogg Fact-checked by Tim Sykes
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Snap Inc.’s stocks have been trading down by -4.32 percent as investors react to privacy concerns affecting ad revenue.

Market Dynamics Affect Snap Inc.

  • Analysts note that despite Snap Inc.’s quarterly revenue growing to $1.36B, uncertainty in the macroeconomic space has left the company reluctant to issue guidance for the next quarter. This has triggered a 14% drop in after-hours trading.

  • Truist has slashed Snap’s target price to $11 from $14, highlighting that even though direct response advertising and Snapchat+ showed promise, broader brand advertising remains sluggish under current market conditions.

  • B. Riley has reduced Snap’s price target, citing macroeconomic factors and tariffs impacting its overall performance. The ongoing constraints on advertising spending further complicate the firm’s fiscal landscape.

Candlestick Chart

Live Update At 14:32:25 EST: On Thursday, May 15, 2025 Snap Inc. stock [NYSE: SNAP] is trending down by -4.32%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

Earnings Overview: Snap Inc.

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Snap Inc.’s recent results painted a complex picture. Revenues for the first quarter reached $1.36 billion, showing slight growth from the previous year’s $1.19 billion. However, unlike the past, the company declined to offer a future outlook due to economic unpredictabilities that loom over advertising demand—a central facet of Snap’s revenue model.

In a phase overshadowed by challenging economic scenarios, the company reported a loss per share reducing from $0.19 previously to $0.08 currently, yet the absence of Q2 guidance was a disappointment many couldn’t disguise. Typically, guidance offers a glimpse into what might lie ahead, but Snap’s reticence leaves investors in a sort of limbo over the company’s near-term trajectory.

From financial metrics to the minutiae of its income statement, a notable story comes through: The total revenue climbed as expected, and operating cash flow stood firm at $151.61M. Yet, net income marked a downward spiral at -$139.58M, a reminder that even an innovative company isn’t immune to persistent market headwinds.

More Breaking News

Key ratios further shed light: a negative EBIT margin of -8.7% and a gross margin standing strong at 54.1%. The balance this portrays is quite the puzzle; Snap Inc. is decidedly profitable at the gross level before operating expenses dent any residual optimism.

Gauging Market Sentiment

Amid this fluctuating backdrop of economic mood swings and the jitters from potential regulatory issues, Snap (SNAP) stocks tumbled almost 14% following its decision to withhold Q2 financial guidance. The uncertainty tethered to macro environments may not have been the news speculators were hoping to hear. Analysts like Citigroup have resorted to lowering Snap’s price target to $12 as it faces mounting challenges related to monetizing short-form video content effectively.

The BofA’s inclination to maintain a neutral rating, while trimming the price target to $10, bolsters a narrative of cautiousness. Advertising remains Snap’s lifeline, and in these changing times, their approach will be key for crafting a resilient recovery strategy.

Examining Market Impact and Outlook

How these insights will exchange hands in subsequent trading sessions might depend largely on the macroeconomic radar. With invested parties eager to understand if Snap can modulate its cost structures and recalibrate advertising outcomes, any tangible shifts in global economic affairs or segmental innovations could reshape trader impressions. As millionaire penny stock trader and teacher Tim Sykes says, “Consistency is key in trading; don’t let emotions dictate your trades.” This principle holds significant weight for those looking at Snap’s performance.

The reporters are quick to underline that Snap is grappling with influences outside its domain —tariff complications and advertising challenges—all which, indirectly, ripple through as headwinds to contend with. Yet, within this turbulent sea lies a chance for resurgence.

The anticipated impact on Snap’s market performance going forward will heavily rely on how adeptly it can navigate these macro hurdles, reaching strategic partnerships, and satisfying its community of users and advertisers alike. The days ahead might show if there’s potential for Snap to outmaneuver these adversities or if steadied caution remains the name of the game.

In summation, the ebb and flow of Snap Inc.’s narrative circle back to a question fundamental to all stewards of change: will it weather the storm poised for a turnaround, or must it ride out the storm a little longer? Whatever the outcome, onlookers will be poised over the edge of their seats, watching, waiting, and anticipating the slide or rise.

This is stock news, not investment advice. Timothy Sykes News delivers real-time stock market news focused on key catalysts driving short-term price movements. Our content is tailored for active traders and investors seeking to capitalize on rapid price fluctuations, particularly in volatile sectors like penny stocks. Readers come to us for detailed coverage on earnings reports, mergers, FDA approvals, new contracts, and unusual trading volumes that can trigger significant short-term price action. Some users utilize our news to explain sudden stock movements, while others rely on it for diligent research into potential investment opportunities.

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The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”