Live news: Snap and Pinterest bounce back from the selloff after better than expected results
The two social media companies fell 23% and 10%, respectively, during market hours after Facebook’s parent company Meta released a dismal earnings and guidance package on Wednesday, citing changes from Apple and increased competition from TikTok. Shares of Meta also plunged 20% on the news, wiping out more than $200 billion of the company’s market capitalization.
However, Snap and Pinterest rose 50% and 28% in after-hours trading, respectively, on better-than-expected fourth-quarter results, which eased the tech rout.
Los Angeles-based Snap reported net profit of $23 million, beating analysts’ estimates of net loss at $148.83 million. Sales rose 42% year over year to $1.3 billion, above forecast. In the current quarter, Snap said it expects revenue of between $1.03 billion and $1.08 billion, also slightly above expectations.
Meanwhile, Pinterest’s revenue rose 20% year-over-year to $847 million, well above analysts’ expectations of $827 million, though its monthly user count assets decreased by 6% to 431 million.
Social media platforms have struggled to adapt to Apple’s new privacy standard, introduced last April, which requires apps from the iPhone maker’s App Store to obtain users’ explicit permission. to track them for advertising purposes. In particular, the changes make it difficult for the company to target users with personalized ads and to measure ad performance.
Derek Andersen, Snap’s chief financial officer, said in prepared remarks Thursday that the company had experienced “better than expected demand” from some advertisers, who had “begun to recover from the initial disruption caused by the changes in iOS platform”.