Snap Shares Rise 12% after News of Bullish Internal Memo from CEO Evan Spiegel


A leaked internal memo from CEO Spiegel revealed optimistic projections for Snap, likely relieving investors and causing shares to rise.

Snap Inc (NYSE: SNAP) shares jumped about 12% following news that the company’s co-founder and CEO informed employees in a September internal memo that the company’s number of daily active users (DAUs) is set to hit 475 million next year. The new figure surpasses the expectations of analysts who had pegged Snap’s 2024 DAU at 448 million.

Snap Shares Rise on Spiegel’s Bullishness

According to a The Verge report, CEO Evan Spiegel revealed that the project for 2024 is bullish. In addition to an increase in DAUs, Spiegel’s memo projected that the company’s advertising revenue growth will climb by more than 20% in 2024. According to Bernstein analyst Mark Schilsky in his Tech Specialists newsletter, this is significantly better than the 14% expected for next year.

Furthermore, Snap’s CEO included in the memo that the company’s forecasted adjusted EBITDA for 2023 is $500 million. This is also quite the bullish projection, considering that current expectations have the figure at $250 million.

In reaction to the news, Snap shares climbed 11.98% and closed at $9.72, according to data from MarketWatch. This contributed to much of the 12.89% increase the stock has seen over 5 days. In the last month, Snap shares have increased 9.34%, and 8.6% year to date (YTD). However, the company’s stock has lost 8.22% in the past year, and nearly 28% in 3 months.

These projections seemed to relieve investors who were likely worried about the general decline in the advertising market. Schilsky noted that before the news, interest in Snap shares was “incredibly low.” This is likely because Snap was one of the first ad-focused companies to report a decline in demand. Schilsky has admitted that “the stock would likely be materially higher if they hit this goal.” However, the analyst warns that Snap should stop including forecasts like this in its memos. He said:

“Stop doing this! For the love of your shareholders stop putting out aspirational goals like this. I know this was an internal memo, but management must have known it was going to leak.”

Shares Fell in Q1

In April, Snap shares fell 18% after the company posted financial figures for Q1 that missed Wall Street expectations. The company reported that its revenue for the quarter was $989 million, less than the $1.01 billion expected by analysts Refinitiv polled. In addition, the company also missed expectations for DAUs, at 383 million versus the 384 million consensus from analysts StreetAccount surveyed.

Snap added a few features to its app in Q1 to attract more users and keep them engaged. The company introduced a 3D view to its Snap Map and also included Content Controls in Family Center so parents can control the content their children can access.

In addition, Snap added a new ad format that fuses ad design and content design to support revenue growth. The company also launched Augmented Reality Enterprise Services (ARES) and Ray Tracing, which adds realistic qualities to digital objects.



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Tolu Ajiboye

Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge.
When he’s not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.



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