Snap (SNAP) AI Stock Analysis

• Market Cap: $13.43B
• Dividend Yield: N/A
• Average Volume (3M): 121.51M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.32
• Revenue Growth: 13.18%
• EPS Growth: 54.39%
• Country: US
• Employees: 5,061
• Sector: Communication Services
• Sector Strength: 97
• Industry: Internet Content & Information
• EPS (TTM): -0.16
• Shares Outstanding: 1,435,682,400
• 10 Day Avg. Volume: 38,981,717
• 30 Day Avg. Volume: 121,510,243
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.18
• Enterprise Value/Revenue: 2.81
• Enterprise Value/Gross Profit: 5.22
• Enterprise Value/Ebitda: -53.23
• 1Y Price Target: $9.22
• Price Target Upside: 16.56% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 29

• Rating: 61 Neutral
• Price Target: $8.50 ▲(7.46% Upside)

Snap's overall score reflects strong user and revenue growth, particularly in international markets and new product lines like Snapchat+. However, profitability challenges and valuation concerns weigh heavily. Technical indicators suggest caution, while strategic initiatives in AI and AR offer potential for future growth.

Positive Factors

Augmented Reality Engagement

High engagement with AR lenses indicates Snap's strong position in augmented reality, enhancing user experience and attracting advertisers.

Revenue Growth

Consistent revenue growth reflects Snap's effective monetization strategies and expanding market reach, supporting long-term business sustainability.

Cash Flow Improvement

Positive free cash flow indicates improved operational efficiency and financial health, providing resources for future investments and growth.

Negative Factors

Profitability Challenges

Ongoing net losses highlight Snap's struggle to achieve profitability, which could limit its ability to reinvest in growth and innovation.

Ad Platform Issues

Technical issues with the ad platform can undermine revenue potential and advertiser trust, affecting long-term revenue stability.

North America User Growth

Stagnant user growth in a key market like North America could limit Snap's ability to increase ad revenue and expand its user base.

Snap Business Overview & Revenue Model

Company Description

Snap Inc. is a technology and social media company known for its multimedia messaging app, Snapchat. Founded in 2011, Snap operates primarily in the social media and augmented reality sectors. Its core products include the Snapchat app, which allows users to send photos and videos that disappear after being viewed, as well as various augmented reality features and lenses that enhance user engagement. Additionally, Snap develops and sells hardware products, such as Spectacles, which integrate camera technology into wearable sunglasses.

How the Company Makes Money

Snap generates revenue primarily through advertising. The company offers a range of advertising products, including Snap Ads, Story Ads, and Sponsored Lenses, allowing brands to engage with users on the platform. Advertisers pay based on impressions, video views, or interactions with ads. In addition to advertising, Snap has begun to diversify its revenue streams through partnerships and collaborations, including sponsored content with media companies and collaborations with brands for augmented reality experiences. The company also monetizes its augmented reality technology through partnerships that integrate AR into brand campaigns. Snap's investment in augmented reality and its focus on user engagement are critical factors contributing to its earnings.

Snap Financial Statement Overview

Summary

Snap shows revenue growth and improved cash flow management, yet profitability remains a challenge with ongoing losses. The improvement in leverage and cash reserves provides stability, but the company needs to address profitability to enhance financial strength further.

Income Statement

Snap's revenue has shown consistent growth, with a notable increase from the previous period, improving by approximately 3.14% in the TTM (Trailing-Twelve-Months). Despite positive gross profit margins around 54.07%, the company struggles with negative EBIT and net income, reflecting ongoing profitability challenges. Efforts to reduce the loss are evident, but profitability remains a concern.

Balance Sheet

Snap's balance sheet displays a strong cash position with a significant amount of cash and equivalents. The debt-to-equity ratio has improved due to a decrease in total debt, indicating better leverage management. However, the equity ratio remains relatively low, with stockholders' equity comprising only about 30.46% of total assets, pointing to reliance on liabilities.

Cash Flow

Operating cash flow has improved, indicating better cash generation from operations. The free cash flow has grown significantly, showcasing improved efficiency in cash management. However, the company still faces challenges with achieving positive net income, affecting the overall cash flow to net income ratios.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.64B	5.36B	4.61B	4.60B	4.12B	2.51B
Gross Profit	3.03B	2.89B	2.49B	2.79B	2.37B	1.32B
EBITDA	-297.84M	-492.60M	-1.10B	-1.18B	-337.55M	-742.21M
Net Income	-546.30M	-697.86M	-1.32B	-1.43B	-487.95M	-944.84M
Balance Sheet
Total Assets	7.40B	7.94B	7.97B	8.03B	7.54B	5.02B
Cash, Cash Equivalents and Short-Term Investments	2.89B	3.38B	3.54B	3.94B	3.69B	2.54B
Total Debt	4.19B	4.24B	4.34B	4.18B	2.63B	2.00B
Total Liabilities	5.33B	5.49B	5.55B	5.45B	3.75B	2.69B
Stockholders Equity	2.07B	2.45B	2.41B	2.58B	3.79B	2.33B
Cash Flow
Free Cash Flow	392.38M	218.65M	34.79M	55.31M	223.00M	-225.48M
Operating Cash Flow	586.61M	413.48M	246.52M	184.61M	292.88M	-167.64M
Investing Cash Flow	-153.41M	-717.08M	570.95M	-1.06B	90.23M	-729.86M
Financing Cash Flow	-569.29M	-428.62M	-458.79M	306.71M	1.07B	922.79M

Snap Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 7.91
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SNAP, the sentiment is Neutral. The current price of 7.91 is below the 20-day moving average (MA) of 7.99, above the 50-day MA of 7.72, and below the 200-day MA of 8.81, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 49.49 is Neutral, neither overbought nor oversold. The STOCH value of 59.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SNAP.

Snap Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
META	―	$1.85T	26.74	40.65%	0.28%	19.38%	40.62%
GOOGL	―	$3.15T	27.68	34.83%	0.30%	13.19%	34.51%
PINS	―	$23.10B	12.60	48.08%	―	17.00%	901.05%
RDDT	―	$40.09B	180.81	10.11%	―	69.97%	―
SPOT	―	$130.91B	152.35	13.94%	―	15.52%	67.15%
SNAP	―	$13.43B	―	-26.42%	―	13.18%	54.39%
Sector *	―	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%

Snap Corporate Events

Snap Issues Senior Notes for Debt Management

Snap announced the issuance of senior unsecured notes under an indenture agreement dated August 12, 2025, with U.S. Bank Trust Company as trustee. The notes, which bear a 6.875% interest rate, will mature on March 15, 2034, unless repurchased or redeemed earlier. The net proceeds of approximately $541.3 million, along with cash on hand, were used for repurchasing outstanding convertible senior notes due in 2026, 2027, and 2028, totaling an aggregate cash repurchase price of $550.1 million. These transactions, settled around August 12, 2025, reflect Snap’s strategic financial maneuvers to manage its debt obligations.

The most recent analyst rating on (SNAP) stock is a Hold with a $13.00 price target. To see the full list of analyst forecasts on Snap stock, see the SNAP Stock Forecast page.