Wednesday was a day of reckoning for Wall Street's thirst trap du jour, Snap, Inc. It was the first quarterly release since the camera company's deliriously hyped IPO dropped, and boy was it a doozy.
Daily active users, revenue and earnings per share all missed. The Etsy of social media lost $2 billion, largely in compensation expenses, while bringing in just $158 million. The stock fell more than 25 percent after-hours. Revenue per U.S. user clocked in at $1.71 – about a tenth of Facebook's. In other words:
But on the earnings call, Snap's precocious CEO Evan Spiegel defended the company's prospects. “People really enjoy looking like a puppy – ha – and things like that,” he said at one point. Asked by an analyst whether non-millennials can ever be led onto the platform, Spiegel recalled how he taught his grandma to use email 20 years ago (when he was six). His IPO bonus: $750 million.
We look forward to hearing reactions from Goldman Sachs, Morgan Stanley, Jefferies, RBC, Cowen, and Credit Suisse, whose positions as Snap underwriters should give them prime vantage points into their uniformly held buy thesis moving forward. “It should be a fun rest of the year,” Spiegel said.