Let’s dig into the relative performance of Meta (NASDAQ: META) and its peers as we unravel the now-completed Q4 social networking earnings season.
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 5 social networking stocks we track reported a satisfactory Q4. As a group, revenues beat analysts’ consensus estimates by 2.5% while next quarter’s revenue guidance was 1.2% below.
While some social networking stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.6% since the latest earnings results.
Weakest Q4: 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 $48.39 billion, up 20.6% year on year. This print exceeded analysts’ expectations by 2.9%. Despite the top-line beat, it was still a mixed quarter for the company with an impressive beat of analysts’ EBITDA estimates but revenue guidance for next quarter missing analysts’ expectations significantly.
"We continue to make good progress on AI, glasses, and the future of social media," said Mark Zuckerberg, Meta founder and CEO.
The stock is up 3.5% since reporting and currently trades at $700.
Is now the time to buy Meta? Access our full analysis of the earnings results here, it’s free.
Best Q4: 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 $1.56 billion, up 14.4% year on year, outperforming analysts’ expectations by 0.6%. The business had a strong quarter with an impressive beat of analysts’ EBITDA estimates and solid growth in its users.
Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 7.4% since reporting. It currently trades at $10.76.
Is now the time to buy Snap? Access our full analysis of the earnings results here, it’s free.
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 $362 million, up 5.7% year on year, exceeding analysts’ expectations by 3.3%. Still, it was a mixed quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
Yelp delivered the slowest revenue growth in the group. As expected, the stock is down 6.3% since the results and currently trades at $38.
Read our full analysis of Yelp’s results here.
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 $1.15 billion, up 17.6% year on year. This result beat analysts’ expectations by 1.2%. It was a strong quarter as it also put up EBITDA guidance for next quarter exceeding analysts’ expectations.
The company reported 553 million monthly active users, up 11% year on year. The stock is up 15% since reporting and currently trades at $38.63.
Read our full, actionable report on Pinterest here, it’s free.
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 $427.7 million, up 71.3% year on year. This print surpassed analysts’ expectations by 4.6%. Aside from that, it was a satisfactory quarter as it also recorded EBITDA guidance for next quarter exceeding analysts’ expectations but a significant miss of analysts’ number of domestic daily active visitors estimates.
Reddit scored the biggest analyst estimates beat and fastest revenue growth among its peers. The company reported 48 million daily active users, up 31.9% year on year. The stock is down 12.7% since reporting and currently trades at $189.05.
Read our full, actionable report on Reddit here, it’s free.
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