With about 1/5th of the DAUs that it has compared to Facebook, this 30 minute spend is surprisingly only 3 minutes less than the time users spend on Facebook itself. When it comes to Snapchat, the average user spends 30 minutes on the app on a daily basis. Although a QoQ drop was observed in Q1'22, this is normal due to the typical seasonality in ads businesses where Q4 tends to bring in the highest revenues as a function of aggressive spend by merchants during the holidays. This is as expected purely due to the law of numbers and the fact that Snap is looking to grow its revenues outside of its key market more. On a yoy basis, Snap increased its North American revenues by 37%, which lagged the 43% growth observed in Europe and 38% in the RoW segment. On a nominal basis, North America brings in close to 5x the amount of revenues generated in Europe and the RoW, also because ARPUs there are significantly higher, 4X that of Europe's ARPUs and 8X that of the RoW. North America accounts for 71% of the entire topline, followed by a roughly even split between the European and RoW markets, that both account for 15% each. In terms of its geographical concentration, revenues are primarily generated from its legacy North American market just like it is with Facebook. What's particularly impressive is the fact that the growth on a YoY basis is despite the fact that for the last month within Q1'22 (March), Snap halted all advertising in Russia, Belarus and Ukraine. On a high level, revenues grew 38% yoy for Q1'22, driven by an increase in user count as well as ARPUs. Snap has also been seeing strong growth in India (RoW segment) especially after TikTok was banned in June 2020, in what can be considered to be a catalyst that drove further adoption as consumers turned to counterparty sources of entertainment. On a QoQ basis, growth has slowed to 4.1% when compared to the growth observed from Q4'20 to Q1'21 of 5.7%. In its most recent FQ1'22, Snap's DAUs increased 18% YoY, primarily driven by growth in the RoW segment. Looking past the nominal value and focusing on growth rates, Snap's DAUs have been steadily increasing over the years. However, it would be premature to assume that just because Snap has a smaller daily active user (DAU) and MAU base, it would be an inferior opportunity relative to the rest of the industry. In terms of monthly active users (MAUs), Snap is still nominally far behind its larger peers, with over 530M MAU s while Facebook (FB) has more than 5X that at 2.9BN and TikTok with over 1BN MAU s. Close to 99% of the overall topline was attributable to ads for the fiscal year ending 2021, and the other 1% to 'snap spectacles and other sources'. Just like most other social media companies out there, Snap primarily makes its revenues from advertisements. This article covers Snapchat's growth story as well as the possibility for the company to be the leader in the AR software and hardware segment, which although if true, would be years away. With a high expected growth rate on the topline of 33% the next 4 years, this stock warrants a closer look to determine whether current share prices do really offer investors an asymmetric opportunity to initiate a position. Snap ( NYSE: SNAP) has fallen 71% from its highs in September 2021. Drew Angerer/Getty Images News Introduction
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