Snapchat parent Snap beat expectations for its fiscal third quarter, saying Tuesday that its daily active users rose 18% to 249 million last quarter compared with the year before. Revenue jumped 52% to nearly $679 million, and the company posted a profit of 1 cent a share. Wall Street had anticipated a loss.
Snap is the first major name in the Internet space this earnings season to give a glimpse into advertising trends during the quarter ended in September. It’s been pushing into direct response ads, the most lucrative. The stock rallied ahead of the numbers, flirting with an all-time high Monday and surged nearly 20% in after-hours trading today on the earnings numbers posted after market close.
The average number of Snaps created every day grew 25% year-over-year. Total daily time spent by Snapchatters watching Shows increased by over 50%.
The earnings release stressed the company’s camera and augmented reality platforms, or Lenses, which are gaining traction. As of Sept. 30, over 1.5 million Lenses have been created by the Snap community through Lens Studio. The ‘Raise Your Voice’ Lens generated over 70 million impressions and over 48,000 hours of playtime, “demonstrating the power of AR as a format in honoring the legacy of important movements, such as the March on Washington in 1963.”
The ‘Anime Style’ Lens powered by real time machine learning — which users transform people into anime characters — was engaged with 3 billion times in its first week.
“Our focus on delivering value for our community and advertising partners is yielding positive results during this challenging time. We’re excited about the growth of our business in Q3 as we continue to make long-term investments in our future,” said Snap Evan Spiegel, CEO. “The adoption of augmented reality is happening faster than we had previously anticipated, and we are working together as a team to execute on the many opportunities in front of us.”
Execs will discuss the earnings in a call later this afternoon.