Winners And Losers Of Q2: Snap (NYSE:SNAP) Vs The Rest Of The Social Networking Stocks

Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at Snap (NYSE:SNAP), and the best and worst performers in the social networking group.

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 4 social networking stocks we track reported a mixed Q2; on average, revenues beat analyst consensus estimates by 3.03%, while on average next quarter revenue guidance was 2.14% above consensus. Tech stocks have been under pressure as inflation makes their long-dated profits less valuable and social networking stocks have not been spared, with share prices down 17.6% since the previous earnings results, on average.

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 $1.07 billion, down 3.89% year on year, in line with analyst expectations. It was a weak quarter for the company, with slow revenue growth and underwhelming revenue guidance for the next quarter.

“We are excited by the progress we have made delivering increased return on investment for our advertising partners, growing our community to 397 million daily active users, and reaching more than 4 million Snapchat+ subscribers,” said Evan Spiegel, CEO.

Snap delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. The company reported 397 million daily active users, up 14.4% year on year. The stock is down 28.8% since the results and currently trades at $8.91.

Read our full report on Snap here, it's free.

Best Q2: 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 Facebook Reality Labs.

Meta reported revenues of $32 billion, up 11% year on year, beating analyst expectations by 3.12%. It was a strong quarter for the company, with optimistic revenue guidance for the next quarter and a decent beat of analysts' revenue estimates.

Meta scored the fastest revenue growth among its peers. The company reported 3.88 billion monthly active users, up 6.3% year on year. The stock is up 1.36% since the results and currently trades at $302.82.

Is now the time to buy Meta? Access our full analysis of the earnings results here, it's free.

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 $708 million, up 6.32% year on year, beating analyst expectations by 1.78%. It was a decent quarter for the company, with the Q3 outlook for revenue and adjusted EBITDA relatively in line with consensus estimates.

The stock is down 12.3% since the results and currently trades at $25.41.

Read our full analysis of Pinterest's results here.

Nextdoor (NYSE:KIND)

Helping residents figure out what's happening on their block in real time, Nextdoor (NYSE:KIND) is a social network that connects neighbors with each other and with local businesses.

Nextdoor reported revenues of $56.9 million, up 4.31% year on year, beating analyst expectations by 6.51%. It was a decent quarter for the company, with a solid beat of analysts' revenue estimates but slow revenue growth.

Nextdoor pulled off the strongest analyst estimates beat among the peers. The company reported 41.6 million daily active users, up 12.7% year on year. The stock is down 33.4% since the results and currently trades at $1.93.

Read our full, actionable report on Nextdoor here, it's free.

The author has no position in any of the stocks mentioned