Snap Inc.

Snap continued to encounter massive challenges due to increased competition and macroeconomic headwinds. In the fourth quarter, the company did manage a decent result with revenues matching Wall Street expectations and an earnings beat as it succeeded in driving a strong growth in the community with 375 million daily active users. In the quarter, the company released communities to expand its content offerings and onboarded several new media partners. The company has also launched new Snapchat+ features to increase audience engagement on the platform in the quarter. Snap continued making progress in updating and improving its ad platform. Though the advertising demand did not increase this quarter, it has not worsened either. The company is now focusing on improving in-app web view performance. Though the last quarter’s result could not meet the expectations, it remained static at a profitable margin. Snap is also planning to take Machine Learning models and train them to offer a more efficient and convenient platform to the users. The company is focusing on developing AR lenses for the platform by using generative AI technology in the near future. We provide the stock of Snap a ‘Hold’ rating and a revision in the target price.