Snap's Stock Hits Record High on Big Revenue Projections
Company’s share price has now quadrupled in the last year, following Tuesday’s spike
Snap’s stock price surged to a new all-time high on Tuesday after the Snapchat parent company told shareholders it expects sales to increase 50% a year for multiple years thanks to its maturing ad business.
“Via the work on our self-serve ad platform, we’re in a position to drive multiple years of 50% plus revenue growth,” Peter Sellis, Snap’s senior director of ad products, said during the company’s first-ever investor day.
Up to that point, Snap’s stock was down about 7% on the day, hovering near $58 per share. Investors clearly loved the aggressive sales projection, though, because Snap’s stock soared right afterward, closing the day at a record high of $70.45 per share.
Snap’s investor day came a few weeks after the Los Angeles-based company reported it added 16 million daily users during Q4, helping it close 2020 with 265 million DAUs overall. Snap’s Q4 sales and earnings also topped Wall Street’s expectations, too, with Snap’s revenue up 62% year-over-year to $911 million last quarter.
Snap’s investor day comments likely helped offset potential shareholder concerns from a few weeks ago, when CFO Derek Anderson warned the app got off to a slow start in Q1, after advertisers paused their campaigns for two weeks following the Jan. 6 attack on the U.S. Capitol. Andersen said, “We started the quarter slower than we would have otherwise expected.”
Snap’s stock, following strong user and business growth in 2020, is now up 336% from this time a year ago.
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