Snap blames Apple ad privacy changes for slumping Q3 results
Snap has announced its financial results for the third quarter of 2021, highlighting the impact that Apple’s new privacy rules for digital advertising have on its business.
Snap’s revenue totaled $1.1 billion and narrowed its loss to $72 million
The Snapchat owner said its revenue rose 57% for the three months ended September 30, slightly below analysts’ expectations and its own guidance. It also expects expansion to slow as daily active users (DAUs) rose 23% to 306 million.
“Snap celebrated its 10th anniversary this quarter, and we are excited about the long-term opportunity and potential for our business, as we grew our community to 306 million daily active users, and grew our revenue 57% year-over-year to reach $1.067 billion for the quarter,” said Evan Spiegel, the chief executive officer at Snap.
“We’re now operating at the scale necessary to navigate significant headwinds, including changes to the iOS platform that impact the way advertising is targeted, measured, and optimized, as well as global supply chain issues and labor shortages impacting our partners. We will continue to focus on delivering strong results for our advertising partners and innovating to expand the capabilities of our platform and better serve our community.”
Aaron Goldman, chief marketing officer at Mediaocean said Snap continues to play a critical role for brands within the omnichannel advertising mix. As the platform expands its formats from video to AR in an effort to drive more time spent with the app from its Gen Z base, marketers are quickly adapting with creative assets and product integrations.
“Snap also provides strong signals on commercial behaviour through its content, maps, and shopping features. Looking ahead to the next quarter and 2022, Snap has all the ingredients inside its ecosystem for advertising success with activity outside walled gardens becoming more difficult to capture,” he explained.
What did Snap’s results show?
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Snap’s revenue totaled $1.1bn and narrowed its loss to $72m from $200m a year earlier.
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Year-over-year growth in DAUs exceeded 20% for four consecutive quarters.
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In the third quarter 2021, five of Snap’s augmented reality Lenses driven by SnapML, its machine learning platform in Lens Studio, generated more than 1 billion impressions each, achieving over 11bn impressions in total.
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15 different Discover partners each reached over 50m unique Snapchatters in Q3 of 2021.
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Two of its new Snap Originals, “Meme Mom” and “Honestly Loren”, reached over 10m viewers each.
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Snap’s new Birthday Mini, which allows Snapchatters to see their friends’ birthdays and send personalized greetings, was used by over 10m Snapchatters in the first 21 days after launch.