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Did Snap’s Top Line Meet the Target in Q4?

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Jan. 28 2019, Published 10:22 a.m. ET

Up to 33% revenue growth expected

Snap (SNAP) is scheduled to release its results for the fourth quarter of 2018 on February 5. What’s in the cards for the company? Snap is expected to report a YoY (year-over-year) rise in revenue. 

Internally, the company has guided for fourth-quarter revenue in the range of $355 million–$380 million, indicating potential revenue growth of up to 33% YoY. The consensus on Wall Street calls for Snap to report revenue of $374 million in the quarter.

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Mixed track record

Snap has a mixed track record in terms of meeting consensus revenue targets, meaning that a lot is still up in the air as the company gears up to report its fourth-quarter results.

Snap went public in March 2017, and its upcoming report will be its second fourth-quarter report as a public company. In the fourth quarter of 2017, Snap reported revenue of $285.7 million, beating the consensus estimate by more than $30 million. In the last three quarters, Snap has topped the consensus revenue estimate twice and missed it once.

Snap topped its peers in terms of revenue growth

In the third quarter of 2018, its most recently reported period, Snap reported $298 million in revenue, exceeding the consensus estimate by more than $15 million. Snap’s revenue rose 43% YoY, outpacing the 33% YoY growth at Facebook (FB) and the 21% YoY growth at Alphabet (GOOGL) in the period. Twitter (TWTR) and Yelp (YELP) grew their revenues 29% and 8.0% YoY, respectively, in the third quarter.

But Snap’s revenue growth rate has been slowing in recent quarters.

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