Snapchat parent Snap stock surged 9% Thursday as the company reported a blowout second quarter with beats on the top and bottom line and for daily active users, which hit 293 million — up 23% or 55 million from the year ago.
DAUs at the end of the first-quarter were 280 million. The name of the game is whether social media companies can continue to add users and grow advertising as the economy reopens, and how much and how fast.
Snap’s revenue soared 116% to $982 million. Net losses narrowed by 53% to $152 million. The company lives on advertising and is particularly powerful among the Gen Z set.
Guidance is also a key metric for Wall Street and Snap’s was good. It sees revenue growing an estimated 58% to 60% in the current third quarter year-on-year.
“Our second quarter results reflect the broad-based strength of our business, as we grew both revenue and daily active users at the highest rates we have achieved in the past four years,” said CEO Evan Spiegel.
“We are pleased by the progress our team is making with the development of our augmented reality platform, and we are energized by the many opportunities to grow our community and business around the world,” he said.
Snap cited new and improve capabilities at Lens Studio, new categories for Scan and the introduction of Camera Shortcuts — that helps users find the best camera mode. It added Connected Lenses, which let Snap-chatters in different locations interact with each other through AR. (Really popular — Snapchat’s Cartoon 3D Style Lens, which uses machine learning to turn a user into a 3D-animated cartoon in real-time, generated 2.8 billion impressions.)
On the content side, it aired eight new and renewed Snap Originals, including Swae Meets World, a documentary featuring the musician as he prepares to launch a solo album.
Snap launched a 177 new international Discover Channels, including 36 in the U.K. and 24 in India, one of which is a partnership with SPE.
Spotlight’s daily active users grew 49%, average daily content submissions more than tripled, and daily time spent per user in the US grew by over 60% quarter-over-quarter, the company said.