Snap Inc. Announces Third Quarter 2025 Financial Results

Third quarter revenue increased 10% year-over-year to $1,507 million

Daily Active Users increased 8% year-over-year to 477 million

Monthly Active Users increased 7% year-over-year to 943 million

Operating cash flow was $146 million and Free Cash Flow was $93 million

SNAP Inc. (NYSE: SNAP) today announced financial results for the quarter ended September 30, 2025.

"Our focus on performance, creativity, and simplicity is helping advertisers achieve stronger results while giving our community more ways to communicate," said Evan Spiegel, CEO. "I'm proud of the team's progress and confident that our discipline and innovation will support durable, long-term growth."

Snap Inc. also announced today its board of directors has authorized a stock repurchase program of up to $500 million of its Class A common stock. Repurchases of the Class A common stock may be made from time to time, either through open market transactions (including through Rule 10b5-1 trading plans) or through privately negotiated transactions in accordance with applicable securities laws. The timing and actual number of shares repurchased will depend on a variety of factors, including stock price, trading volume, market and economic conditions, and other general business considerations. Repurchases under the program have been authorized for 12 months but the program may be initiated, modified, suspended, or terminated at any time during such period.

The goal of the program is to utilize the company's strong balance sheet to opportunistically offset a portion of the dilution related to the issuance of restricted stock units to employees as part of the overall compensation program designed to foster an ownership culture.

Repurchases under this program will be funded from existing cash and cash equivalents. As of September 30, 2025, Snap had $3.0 billion in cash, cash equivalents, and marketable securities.

Q3 2025 Financial Summary

• Revenue was $1,507 million, compared to $1,373 million in the prior year, an increase of 10% year-over-year.
• Net loss was $104 million, compared to $153 million in the prior year.
• Adjusted EBITDA was $182 million, compared to $132 million in the prior year.
• Operating cash flow was $146 million, compared to $116 million in the prior year.
• Free Cash Flow was $93 million, compared to $72 million in the prior year.

Q3 2025 Summary & Key Highlights

We deepened engagement with our community:

• The Snapchat community continues to grow, reaching 943 million global monthly active users (MAU) in Q3, an increase of 60 million or 7% year-over-year.
• Daily active users (DAU) were 477 million in Q3 2025, an increase of 34 million, or 8%, year-over-year.
• In Q3, we shared that Snapchatters created well over one trillion selfie Snaps in 2024, a testament to how our global community uses our camera to communicate, play, and feel closer together.
• Global time spent watching content and the number of content viewers increased year-over-year in Q3, reflecting the multi-year investment in our machine learning infrastructure and the continued growth in Spotlight.
• The share of total Spotlight views from content posted in the last 24 hours increased more than 300% year-over-year in the US as our models better surface more topical and trending content.
• Over the past year, we onboarded thousands of creators to our Snap Star program, with the number of Spotlight posts by Snap Stars growing nearly 180% year-over-year in North America in Q3.
• We launched The Keys: A Guide to Digital Safety – a first-of-its-kind interactive online safety program specifically designed for teens and their parents.

We are focused on accelerating and diversifying our revenue growth:

• Direct Response advertising revenue increased 8% year-over-year, accelerating 3 percentage points from the prior quarter, driven by strong demand for our Pixel Purchase and App Purchase optimizations.
• Purchase-related ad revenue grew over 30% year-over-year, reflecting higher attribution accuracy and better campaign performance.
• Sponsored Snaps have proven to be one of the most effective ways for brands to join the conversation, driving up to 22% more conversions and achieving up to 19% lower costs per action (CPAs) when included in an advertiser's broader Snap campaign mix.
• According to a recent Kantar study, approximately 85% of US Snapchatters feel that Sponsored Snaps are "relevant to me" and "fit in with my habits on the platform."
• We advanced Dynamic Product Ads with large language models that better understand products, driving over 4x higher conversion rates compared to baseline for certain campaigns.
• We launched the App Power Pack, a suite of new products which includes improved Target Cost Bidding, Sponsored Snaps for app advertisers, App End Cards, and Playables for interactive game previews, with early results showing that products in the App Power Pack are driving over 25% lift in iOS App Installs.
• Other Revenue, the majority of which is Snapchat+ subscription revenue, increased 54% year-over-year to $190 million in Q3.
• We announced Memories Storage Plans in Q3 and started to introduce this new offering to our community.
• We took an important step toward building out our AI platform by partnering with Perplexity AI to integrate its conversational search directly into Snapchat.

We invested in our augmented reality platform:

• Our community uses AR Lenses in our Snapchat camera 8 billion times per day, and over 400,000 developers have built more than 4 million Lenses with Snap's world-leading AR tools.
• In Q3, more than 350 million Snapchatters engaged with AR every day on average.
• More than 500 million users have engaged with Gen AI Lenses over 6 billion times, underscoring the growing demand for AI-powered creative tools on the platform.
• Snapchatters engaged with our AI Face Swap Lens over one billion times in Q3, highlighting strong engagement with our latest AR experiences powered by generative AI.
• We introduced the Imagine Lens, our first Open Prompt Image Generation Lens, where Snapchatters can create, edit, and recreate Snaps simply by entering their own prompts.
• We launched the Lens Studio AI Assistant, enabling developers to describe a Lens concept and have AI generate, code, and refine it automatically.
• We also launched Realistic StyleGen Mode, which applies lifelike transformations to clothing, hair, and accessories using on-device machine learning.
• We introduced AI Portraits, which lets Snapchatters create dynamic Lenses by defining a concept through person, action, and scene, and Selfie Attachments, which generate custom 3D assets that automatically attach to the face or body.
• To help developers monetize their work, we introduced Lens+ Partner Payouts, a program that allows creators to publish exclusive GenAI-powered Lenses for Lens+ and earn directly from subscribers.

We are making computers more human with Specs:

• In Q3, we launched Snap OS 2.0, a major update that lays the foundation for the public debut of our next-generation Specs in 2026.
• Snap OS 2.0 introduces a redesigned browser with faster performance, lower power usage, a minimalist user interface, support for widgets and bookmarks, resizable windows, and full WebXR capabilities.
• New features also expand creative and utility use cases: the Spotlight Lens lets users watch short video content , while the Gallery Lens provides a more immersive way to browse, organize, and share videos captured with Spectacles.
• We introduced Travel Mode, which improves the stability of AR content while in motion.
• Our new Spatial Tips Lens enables AI-powered contextual guidance in the real world, from labeling everyday objects to providing instructions for activities like a kick-flip on a skateboard.
• We announced Commerce Kit for Spectacles, enabling select developers to accept payments directly inside Lenses on Specs, allowing for the sale of digital goods or unlocking premium features.
• To prepare for the consumer launch of Specs next year, partners and developers have been building compelling AR experiences:
  • Partners like Enklu and Artglass are transforming live events with location-based Lenses.
  • Developer Caio Alves created Apollo 11, an immersive AR Lens that celebrates the historic 1969 moon landing, transporting users to the lunar surface with rockets, craters, and space-themed visuals.
  • Developer Stijn Spanhove created AI Teleport, a futuristic Lens that uses AI-driven effects to instantly "teleport" users into new environments, transforming their surroundings in a dramatic, sci-fi-inspired way.

Q4 2025 Outlook

Snap Inc. will discuss its Q4 2025 outlook during its Q3 2025 Earnings Call (details below) and in its investor letter available at investor.snap.com.

Conference Call Information

Snap Inc. will host a conference call to discuss the results at 2:00 p.m. Pacific / 5:00 p.m. Eastern today. The live audio webcast along with supplemental information will be accessible at investor.snap.com. A recording of the webcast will also be available following the conference call.

Snap Inc. uses its websites (including snap.com and investor.snap.com) as means of disclosing material non-public information and for complying with its disclosure obligation under Regulation FD.

Definitions

Free Cash Flow is defined as net cash provided by (used in) operating activities, reduced by purchases of property and equipment.

Common shares outstanding plus shares underlying stock-based awards includes common shares outstanding, restricted stock units, restricted stock awards, and outstanding stock options.

Adjusted EBITDA is defined as net income (loss), excluding interest income; interest expense; other income (expense), net; income tax benefit (expense); depreciation and amortization; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; and certain other items impacting net income (loss) from time to time.

A Daily Active User (DAU) is defined as a registered and logged-in Snapchat user who visits Snapchat through our applications or websites at least once during a defined 24-hour period. We calculate average DAUs for a particular quarter by adding the number of DAUs on each day of that quarter and dividing that sum by the number of days in that quarter.

Average revenue per user (ARPU) is defined as quarterly revenue divided by the average DAUs.

A Monthly Active User (MAU) is defined as a registered and logged-in Snapchat user who visits Snapchat through our applications or websites at least once during the 30-day period ending on the calendar month-end. We calculate average Monthly Active Users for a particular quarter by calculating the average of the MAUs as of each calendar month-end in that quarter.

Note: For adjustments and additional information regarding the non-GAAP financial measures and other items discussed, please see "Non-GAAP Financial Measures," "Reconciliation of GAAP to Non-GAAP Financial Measures," and "Supplemental Financial Information and Business Metrics."

About Snap Inc.

Snap Inc. is a technology company. We believe the camera presents the greatest opportunity to improve the way people live and communicate. We contribute to human progress by empowering people to express themselves, live in the moment, learn about the world, and have fun together. For more information, visit snap.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this press release, including statements regarding guidance, our future results of operations or financial condition, future stock repurchase programs or stock dividends, business strategy and plans, user growth and engagement, product initiatives, objectives of management for future operations, and advertiser and partner offerings, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as "anticipate," "believe," "contemplate," "continue," "could," "estimate," "expect," "going to," "intend," "may," "plan," "potential," "predict," "project," "should," "target," "will," or "would" or the negative of these words or other similar terms or expressions. We caution you that the foregoing may not include all of the forward-looking statements made in this press release.

You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this press release primarily on our current expectations and projections about future events and trends, including our financial outlook, macroeconomic uncertainty, and geo-political events and conflicts, that we believe may continue to affect our business, financial condition, results of operations, and prospects. These forward-looking statements are subject to risks and uncertainties related to: our financial performance; our ability to attain and sustain profitability; our ability to generate and sustain positive cash flow; our ability to attract and retain users, partners, and advertisers; competition and new market entrants; managing our growth and future expenses; compliance with new laws, regulations, and executive actions; our ability to maintain, protect, and enhance our intellectual property; our ability to succeed in existing and new market segments; our ability to attract and retain qualified team members and key personnel; our ability to repay or refinance outstanding debt, or to access additional financing; future acquisitions, divestitures, or investments; and the potential adverse impact of climate change, natural disasters, health epidemics, macroeconomic conditions, and war or other armed conflict, as well as risks, uncertainties, and other factors described in "Risk Factors" and elsewhere in our most recent periodic report filed with the U.S. Securities and Exchange Commission, or SEC, which is available on the SEC's website at www.sec.gov . Additional information will be made available in our periodic report that will be filed with the SEC for the period covered by this press release and other filings that we make from time to time with the SEC. In addition, any forward-looking statements contained in this press release are based on assumptions that we believe to be reasonable as of this date. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, including future developments related to geo-political events and conflicts and macroeconomic conditions, except as required by law.

Non-GAAP Financial Measures

To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use certain non-GAAP financial measures, as described below, to understand and evaluate our core operating performance. These non-GAAP financial measures, which may be different than similarly titled measures used by other companies, are presented to enhance investors' overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We use the non-GAAP financial measure of Free Cash Flow, which is defined as net cash provided by (used in) operating activities, reduced by purchases of property and equipment. We believe Free Cash Flow is an important liquidity measure of the cash that is available, after capital expenditures, for operational expenses and investment in our business and is a key financial indicator used by management. Additionally, we believe that Free Cash Flow is an important measure since we use third-party infrastructure partners to host our services and therefore we do not incur significant capital expenditures to support revenue generating activities. Free Cash Flow is useful to investors as a liquidity measure because it measures our ability to generate or use cash. Once our business needs and obligations are met, cash can be used to maintain a strong balance sheet and invest in future growth.

We use the non-GAAP financial measure of Adjusted EBITDA, which is defined as net income (loss), excluding interest income; interest expense; other income (expense), net; income tax benefit (expense); depreciation and amortization; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; and certain other items impacting net income (loss) from time to time. We believe that Adjusted EBITDA helps identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude in Adjusted EBITDA.

We believe that these non-GAAP financial measures provide useful information about our financial performance, enhance the overall understanding of our past performance and future prospects, and allow for greater transparency with respect to key metrics used by our management for financial and operational decision-making. We are presenting these non-GAAP measures to assist investors in seeing our financial performance through the eyes of management, and because we believe that these measures provide an additional tool for investors to use in comparing our core financial performance over multiple periods with other companies in our industry.

For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure, please see "Reconciliation of GAAP to Non-GAAP Financial Measures."

Snap Inc., "Snapchat," and our other registered and common law trade names, trademarks, and service marks are the property of Snap Inc. or our subsidiaries.

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