Архив метки: EPS

Snapchat shrinks by 3M users to 188M despite strong Q2

The Stories War has officially killed Snapchat’s growth, leading to its first user count decline ever. In Q2 2018 earnings today, Snapchat’s daily active users number shrank 1.5 percent to 188 million this quarter, down from 191 million and positive 2.9 percent user growth last quarter.
Snapchat did beat earnings expectations with $262.3 million in revenue and a loss of $0.14 while Wall Street estimated an EPS loss of $0.17 with $249.8 million in revenue. Snap’s net loss decreased by 20 percent year-over-year, so it only destroyed $353 million this quarter compared to $385 million last quarter. Snap will have some extra cash to extend its runway despite its still-massive losses thanks to a $250 million investment from Saudi Prince Al-Waleed Talal in exchange for a 2.3 percent stake in the company.

Snapchat gets $250M investment from Saudi prince for 2.3%

Despite its user count shrinking for the first time since its launch in 2011, the improvement to revenue (up 44 percent year-over-year) and reduced losses led Wall Street to give Snap’s shares an immediate 11 percent pop in after-hours trading. But after dodging multiple questions about how it would improve revenues and when its optimized Android app would arrive, shares fell back to just below the day’s closing price of $13.12.
Snapchat is coming off a disastrous Q1 earnings with its slowest-ever user growth rate that led to a 24 percent plunge in its share price in May. But the company has been highly volatile, seeing a 37 percent boost in its share price after surprisingly positive Q4 2017 earnings. Now it’s proving that Facebook isn’t the only social network with growth troubles.

In hopes of distracting from the shrinking DAUs, Snapchat shared a monthly active user count for the first time: 100 million monthly active users in the U.S. and Canada. Snap says this is the highest it’s ever been, yet the reveal highlights that teens are as addicted to daily Snapchat use as they once were. DAUs are a much more accurate way of measuring engagement and ad revenue potential, as opening a single notification and never returning can still register someone as an MAU.
CEO Evan Spiegel blamed the DAU shrinkage on “a slightly lower frequency of use among our user base due to the disruption caused by our redesign.” But since, he believes “we have now addressed the biggest frustrations we’ve heard” so he’s optimistic about future growth. On the other hand, he credits the redesign as producing an 8 percent increase in retention among users older than 35, demonstrating the new design is more obvious and well labeled.
During the earnings call, Snap’s new CFO Tim Stone mentioned that it’s interested in monetizing every part of the app, including “communication.” That could foreshadow more ads in the messaging inbox beyond the sponsored lenses users can play with to send augmented reality Snaps to friends. Snap is also hoping that after a decline in ad prices as it moved to self-serve auctions, ad prices and revenue will climb.
One big bright point for Snap was that its average revenue per user in the Rest Of World region grew 65 percent just this quarter to reach $0.96. Figuring out how to monetize these developing countries where buying power is lower will be key to the company’s outlook. Snap says it’s still working to re-engineer its Android app to boost performance and reduce churn, since that’s where most of its new users are coming in.

The quarter saw Snapchat escape much of the scrutiny facing other social networks regarding fake news and election interference. But it clearly still has issues with security, as Snapchat accidentally leaked its own source code, which was archived by someone who then posted it to GitHub today, though it was eventually taken down.
Snapchat started running un-skippable ads in its Shows that could be a big money maker if extended to Stories. It began experimenting with e-commerce in earnest, allowing brands to sell things people can buy without leaving the app. It also opened self-serve buying of its augmented reality lens ads that people not only post, but play with for extended periods of time. And it launched its privacy-safe Snap Kit developer platform in hopes that alliances and referral traffic would help revive its user growth.
But problematically, its competitors like Instagram Stories continued to surge, with it now having 400 million daily Stories users and WhatsApp Status now having 450 million. Combined, Facebook has over 1.1 billion daily (duplicated) Stories users across its family of apps. That reach could make it tough for Snap to compete for ad dollars. And with its user count actually decreasing, that could make for a grim future for the teen sensation.

Snapchat shrinks by 3M users to 188M despite strong Q2

After A Rare Miss, Apple Predicts Record iPhone, iPad Sales And Hints At A $40 Billion Quarter

Nemoi-Memo

Yes, Apple missed with their earnings today. It’s the first time in a long time that has happened. Some are suggesting that hasn’t happened since 2002. That’s big news. But it’s also masking even bigger news: Apple’s expectations for next quarter.

In a press release, it can be hard to tell what numbers on a page signify. But those who follow Apple closely must have taken one look at Apple’s guidance for next quarter and had their jaws drop. I know mine did. Apple is projecting to make $37 billion in revenue next quarter, their holiday quarter. They’re projecting an EPS of $9.30. Both are insane (in a good way).

To put this in some perspective, Apple has never had a quarter over $30 billion in revenue. The closest they’ve come was last quarter, when revenue hit $28.57 billion (this past quarter was their second best ever). A year ago during the holiday quarter, Apple did $26.7 billion in revenue. They’re projecting these numbers to be $10 billion higher.

But that’s not the craziest part.

Where this really gets insane is when you realize that Apple always lowballs their projections. For example, this past quarter, they estimated they would bring in $25 billion in revenue, which they easily beat (it was the Street projections that they missed). So if Apple says they’re going to make $37 billion next quarter, it’s entirely possible — hell, maybe even likely — that they still will never have had a $30 billion quarter — because next quarter may be a $40 billion quarter.

Obviously, to get there, they would need to hit an absolute homerun. But again, it’s the holiday quarter for the top consumer electronics company in the world. And it’s the quarter that will see the initial sales of the iPhone 4S, which just launched last weekend to the tune of 4 million units sold in 3 days — the best sales for any phone ever. The iPhone is the key to Apple’s revenue, and it’s the reason why they missed expectations this past quarter. If the iPhone 4S sells well, $40 billion is not out of the question.

For a bit more context, while Apple has held the profit title among tech companies for a little while, they’re still behind HP when it comes to revenue. HP announced revenues of $31.2 billion in their last reported quarter. A few months ago, I predicted that Apple would soon zoom past HP in this regard as well. Now it’s looking like they won’t just squeeze past, they’ll demolish them next quarter. HP’s all-time high for revenue in a quarter is around $33 billion.

It gets even crazier.

Apple is so confident that next quarter is going to be a blow-out quarter that twice on their earnings call today, Apple CEO Tim Cook and CFO Peter Oppenheimer went out of their way to predict that Apple would see record iPhone and iPad sales next quarter. That’s something Apple never does. Their guidance is always very general (and again, low) and they stick to talking about things at a high level. Not today. This is two Apple executives going out on a limb to predict records for their two key products next quarter.

I think it’s pretty obvious that they would only do that if they felt like they weren’t going out on a limb. That is to say, Cook and Oppenheimer must be extremely confident that Apple is going to sell well north of 20 million iPhones (the previous record, set last quarter) and 11 million iPads (the record set this quarter). And a lot more.

So while Wall Street is panicking right now — Apple’s stock is currently down over 27 points (6.5 percent) in after-hours trading after the miss — Apple seems more confident than ever.

Sure, a part of it may be that Apple had to throw investors some bone in a period of relative volatility (a rare miss and just weeks after co-founder and CEO Steve Jobs passed away). But no matter which way you look at it, it’s one hell of a bone.


Company:
Apple
Website:
apple.com
Launch Date:
January 4, 1976
IPO:

October 18, 1980, NASDAQ:AAPL

Started by Steve Jobs, Steve Wozniak, and Ronald Wayne, Apple has expanded from computers to consumer electronics over the last 30 years, officially changing their name from Apple Computer, Inc. to Apple, Inc. in January 2007.

Among the key offerings from Apple’s product line are: Pro line laptops (MacBook Pro) and desktops (Mac Pro), consumer line laptops (MacBook) and desktops (iMac), servers (Xserve), Apple TV, the Mac OS X and Mac OS X Server operating systems, the iPod (offered with…

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After A Rare Miss, Apple Predicts Record iPhone, iPad Sales And Hints At A $40 Billion Quarter