Snap to Report Q4 Earnings: What's in Store for the Stock?

Snap SNAP is scheduled to report fourth-quarter 2024 results on Feb. 4.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.For the fourth quarter, Snap expects total revenues between $1.51 billion and $1.56 billion, implying year-over-year growth of 11-15%. Adjusted EBITDA is expected to be between $210 million and $260 million.The Zacks Consensus Estimate for revenues is currently pegged at $1.55 billion, indicating a 13.8% increase from the year-ago quarter’s reported figure.The consensus mark for earnings has remained unchanged at 14 cents per share in the past 60 days, implying a 75% increase from the year-ago quarter’s level of 8 cents.Snap Inc. Price and EPS Surprise Snap Inc. price-eps-surprise | Snap Inc. QuoteFactors to Note Ahead of Q4 ResultsSnap has been benefiting from a spike in the usage of Snapchat. The growing adoption of Snapchat among the Gen Z (13-24 years) population is expected to have driven Daily Active Users (DAUs), thus expanding the company’s advertiser base. For the to-be-reported quarter, SNAP expects DAUs to be 451 million. In the third quarter, Snapchat’s subscriber growth, reflected by DAUs, increased 9.1% year over year to 443 million. Snap added 11 million DAUs on a quarter-over-quarter basis.Our model estimate for third-quarter global DAUs is currently pegged at 451 million, indicating growth of 8.9% from the year-ago quarter’s level. The model estimate for DAUs in North America, Europe and ROW is currently pegged at 100 million, 100 million and 252 million, respectively. Our model estimate for Snap’s fourth-quarter ARPU is pegged at $3.42, suggesting an increase of 3.8% from the year-ago quarter’s reported figure.Growing adoption of the Snapchat+ offering is likely to have aided subscriber growth in the fourth quarter. Features like Creator Collab Campaigns and Snap Promote are expected to have aided subscriber growth in the to-be-reported quarter. Its newly added app themes, Bitmoji reactions and map reactions features are likely to have boosted user engagement during the quarter. The Snapchat+ subscription service reached more than 12 million paying subscribers in the third quarter.Snap’s fourth-quarter results are likely to benefit from the strong adoption of Augmented Reality (AR) Lenses, Discover content, Shows and Snap Map. In the second half of 2024, Snap introduced the fifth generation of Spectacles, standalone AR glasses powered by Snap OS, its brand-new operating system, which enables users to use Lenses and experience the world together with friends in new ways.Snap's aggressive implementation of AI across its platform is also expected to have been a key growth catalyst during the to-be-reported quarter. During the third quarter, the company's AI-powered chatbot saw engagement triple quarter over quarter, while AI-enabled features in Snapchat Memories and advertising optimization demonstrate practical monetization of this technology.Earnings Whispers for SnapOur proven model does not conclusively predict an earnings beat for Snap this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.Snap carries a Zacks Rank #3 and has an Earnings ESP of -3.70% at present. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.Stocks With the Favorable CombinationHere are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this season.Impinj PI has an Earnings ESP of +1.41% and a Zacks Rank #1 at present.Shares of Impinj have jumped 32% over the past year. PI is set to report fourth-quarter 2024 results on Feb. 5.QUALCOMM QCOM has an Earnings ESP of +3.34% and a Zacks Rank #2 at present.Shares of QUALCOMM have gained 15.8% in the trailing 12 months. QCOM is set to report first-quarter fiscal 2025 results on Feb. 5.Lumentum Holdings LITE has an Earnings ESP of +17.01% and a Zacks Rank #2 at present.Shares of Lumentum Holdings have soared 52.8% over the past year. LITE is set to report second-quarter fiscal 2025 results on Feb. 6.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report QUALCOMM Incorporated (QCOM): Free Stock Analysis Report Impinj, Inc. (PI): Free Stock Analysis Report Lumentum Holdings Inc. (LITE): Free Stock Analysis Report Snap Inc. (SNAP): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks