獅山巡禮
投資雜談
Wrapping up Q2 earnings, we look at the numbers and key takeaways for the social networking stocks, including Reddit (NYSE:RDDT) and its peers.
Businesses must meet their customers where they are, which over the past decade has come to mean on social networks. In 2020, users spent over 2.5 hours a day on social networks, a figure that has increased every year since measurement began. As a result, businesses continue to shift their advertising and marketing dollars online.
The 6 social networking stocks we track reported a satisfactory Q2. As a group, revenues beat analysts consensus estimates by 5.4% while next quarters revenue guidance was 0.9% below.
In light of this news, share prices of the companies have held steady as they are up 1.3% on average since the latest earnings results.
Best Q2: Reddit (NYSE:RDDT)
Founded in 2005 by two University of Virginia roommates, Reddit (NYSE:RDDT) facilitates user-generated content across niche communities (called subreddits) that discuss anything from stocks to dating and memes.
Reddit reported revenues of $499.6 million, up 77.7% year on year. This print exceeded analysts expectations by 17.2%. Overall, it was a very strong quarter for the company with EBITDA guidance for next quarter exceeding analysts expectations.
Reddit is built for this moment. In a world where connection is increasingly rare, our communities show how valuable human conversation and knowledge really are, said Steve Huffman, Reddit Co-Founder and CEO.
Reddit scored the biggest analyst estimates beat and fastest revenue growth of the whole group. The company reported 50.3 million daily active users, up 10.5% year on year. Unsurprisingly, the stock is up 38.1% since reporting and currently trades at $222.52.
Meta (NASDAQ:META)
Famously founded by Mark Zuckerberg in his Harvard dorm, Meta Platforms (NASDAQ:META) operates a collection of the largest social networks in the world - Facebook, Instagram, WhatsApp, and Messenger, along with its metaverse focused Reality Labs.
Meta reported revenues of $47.52 billion, up 21.6% year on year, outperforming analysts expectations by 6%. The business had a strong quarter with an impressive beat of analysts EBITDA estimates and a decent beat of analysts number of daily active people estimates.
The market seems happy with the results as the stock is up 5.9% since reporting. It currently trades at $736.49.
Weakest Q2: Snap (NYSE:SNAP)
Founded by Stanford University students Evan Spiegel, Reggie Brown, and Bobby Murphy, and originally called Picaboo, Snapchat (NYSE: SNAP) is an image centric social media network.
Snap reported revenues of $1.34 billion, up 8.7% year on year, in line with analysts expectations. It was a slower quarter as it posted a significant miss of analysts EBITDA estimates.
Snap delivered the weakest performance against analyst estimates in the group. The company reported 469 million daily active users, up 8.6% year on year. As expected, the stock is down 22.7% since the results and currently trades at $7.26.
Yelp (NYSE:YELP)
Founded by PayPal alumni Jeremy Stoppelman and Russel Simmons, Yelp (NYSE:YELP) is an online platform that helps people discover local businesses through crowd-sourced reviews.
Yelp reported revenues of $370.4 million, up 3.7% year on year. This print surpassed analysts expectations by 1.4%. Taking a step back, it was a mixed quarter as it also recorded an impressive beat of analysts EBITDA estimates but full-year revenue guidance meeting analysts expectations.
The stock is down 8.1% since reporting and currently trades at $31.52.
Pinterest (NYSE:PINS)
Created with the idea of virtually replacing paper catalogues, Pinterest (NYSE: PINS) is an online image and social discovery platform.
Pinterest reported revenues of $998.2 million, up 16.9% year on year. This number beat analysts expectations by 2.2%. Aside from that, it was a satisfactory quarter as it also produced a solid beat of analysts EBITDA estimates but revenue guidance for next quarter meeting analysts expectations.
The company reported 578 million monthly active users, up 10.7% year on year. The stock is down 5.3% since reporting and currently trades at $37.14.
Market Update
Thanks to the Feds rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didnt send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trumps November win lit a fire under major indices and sent them to all-time highs. However, theres still plenty to ponder tariffs, corporate tax cuts, and what 2025 might hold for the economy.
