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Snap (SNAP) stock jumped over 20%, from trading at $12.44 to $15. The surge is attributed to a strong growth of revenue and daily users recorded in the first quarter.
The financial results, for the quarter that ended on March 31, 2020, saw the company record strong growth in revenue and also a surge in its daily users.
Details for Q1 that Fueled Snap Stock Surge
According to the report, the operating cash flow improved by $72 million to $6 million in the first 2020 quarter, in comparison to $73 million in the previous year. The company also recorded an improved free cash flow by $73 to $5 million compared to the prior year.
The report noted:
“Common shares outstanding plus shares underlying stock-based awards totalled 1,589 million at March 31, 2020, compared to 1,544 million a year ago”.
One notable increase was the revenue, which increased by 44% to hit $462 million compared to the previous year. Another positive point was the fact that the company recorded an improved net loss, $4 million to $306 million in comparison with the prior year.
The other financial highlights noted by the company in the report was that the adjusted EBITDA improved $42 million to $(81) million in the first quarter if to consider the previous year.
CEO Evan Spiegel said:
“We are grateful for the opportunity to serve our community and partners during this difficult time”.
“Snapchat is helping people stay close to their friends and family while they are separated physically, and I am proud of our team for overcoming the many challenges of working from home during this time while we continue to grow our business and support those impacted by COVID-19”.
Other than a strong balance sheet, the company also recorded an acceleration in the daily active users by 20% year-over-year, 39 million users. The report also noted that the total daily time spent by Snapchatters watching shows more than doubled in the first quarter compared to a similar time last year.
The company promised to continue investing in its camera and also the augmented reality platforms. This was after 75% of its daily active users engaged in augmented reality every day on average.
Moving forward, the company said it’s working on innovations that will better serve its large and engaged community.
As with most traditional stock markets in the United States, Snapchat was hit hard by the coronavirus outbreak, however, it’s recovering steadily.