Snap Inc Reports Third Quarter Revenue, EPS Beat, Announces Share Buyback, But Stock Plunges Over It

Social networking and camera company Snap Inc SNAP released its third-quarter financial results after the market closed Thursday. Here are the highlights.

What happened: One of the companies that was highlighted as an earnings report to watch for the week, Snap reported after the bell on Thursday.

Snap posted third-quarter revenue of $1.128 billion, up 6% year-over-year. The total is higher than a Street estimate of $1.12 billion, according to data from Benzinga Pro.

The company reported third-quarter earnings of 8 cents per share, beating a Street estimate of a loss of 1 cent per share.

Daily active users were 363 million in Q3, up 19% year-over-year. The company said the number of daily active users increased sequentially and year-over-year in North America, Europe and the rest of the world.

The company reported that time spent watching Spotlight content increased 55% year over year in the third quarter.

"This quarter, we took steps to further focus our business on our three strategic priorities: growing our community and deepening their engagement with our products, re-accelerating and diversifying our revenue growth, and investing in augmented reality,” said Snap CEO Evan Spiegel.

Snap ended the third quarter with $4.4 billion in cash.

Related link: How to trade instant stocks before and after the third quarter results print

What's next: Spiegel said Snap will continue to "navigate this volatile macro environment" with its community of 363 million daily active users.

The company is also focusing on its subscription service called Snapchat+, which reached 1.5 million paid subscribers in the third quarter.

Snap on Thursday announced a $500 million buyout along with its financial results. The shares will be purchased through open market or over-the-counter transactions over the next 12 months.

"The objective of the program is to use the company's strong balance sheet to opportunistically offset some of the dilution associated with the issuance of restricted stock units to employees as part of the overall compensation program designed to foster a culture of ownership,” the company said.

The company said that due to the "operating environment", it would not provide guidance on revenue or adjusted EBITDA for the fourth quarter. Stocks are likely down on this news.

SNAP Price Action: SNAP shares are down 25% at $8.10 in after-hours trading Thursday.

Peer companies like Pinterest PINS and Meta Platforms META are also trading sharply lower on Thursday in the after-hours trading session.

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