Evan Spiegel, the CEO and co-founder of the organization, reported in a message to staff that Snap could possibly record more than 475 million daily active users by 2024, which surpasses the estimates of 448 million from financial specialists, reported by the Verge on Friday. The memo additionally suggested that the full-year income from advertisements might surpass 20% in 2024, a higher number than the supposed projections of a bit over 14%, noted by Mark Schilsky, an analyst at Bernstein, in his Tech Specialists newsletter. Snap affirmed the information in the corporate memo to CNBC, characterizing the figures as "extend, inside objectives as it were."
On Monday, shares of Snap surged by almost 12%, due to reports of the CEO's internal memo signifying that the results for 2024 could come in better than expected. According to the Verge, Evan Spiegel, the co-founder and CEO, sent a memo to his employees in September stating that the daily active users figure for 2024 should exceed 475 million, which surpasses the projected 448 million. In addition, the document anticipated an upsurge in advertising revenue of 20% for 2024, which Mark Schilsky from Bernstein highlighted in his Tech Specialists newsletter is more than the consensus estimate of around 14%. The memo set the 2023 adjusted EBITDA goal at $500 million, something Bernstein pointed out would be a substantial win compared to the current analyst estimates of $250 million. Although Snap verified the numbers mentioned in the memo with CNBC, it was characterized as "stretch, internal goals only". Schilsky implored the company to prevent any disclosure of such targets in memos for employees. He wrote, “Stop doing this! For the love of your shareholders stop putting out aspirational goals like this. I know this was an internal memo, but management must have known it was going to leak.” 2020 has been a troublesome year for the business. As with other social media firms including Meta and Pinterest, Snap's digital advertising system has had difficulty improving after Apple's iOS privacy update in 2021, reducing its capacity to monitor users for targeted ads. Furthermore, Snap has had a more difficult time coping with a problematical digital advertising market, compounded by the Russia-Ukraine war and companies cutting down on their marketing expenditure due to economic insecurities. Following Snap's revelation of a guidance lower than the analysts' projections for the current quarter in July, the shares fell by more than 17%. Schilsky wrote, “The stock is near the lows, expectations are incredibly low (although perhaps that changed after this leak), and the digital ad market is generally doing quite well. So long as SNAP doesn't completely miss the quarter, the like it has for the past five, the stock could experience a meaningful increase on the upcoming earnings release.” Snap will report its third-quarter earnings Oct. 24. Correction: An earlier version of this story misstated the nature of the numbers cited in the memo — they were goals, not projections.
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