As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at social networking stocks, starting with Yelp (NYSE:YELP).
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 6 social networking stocks we track reported a strong Q1. As a group, revenues beat analysts’ consensus estimates by 2.4% while next quarter’s revenue guidance was 1% below.
Luckily, social networking stocks have performed well with share prices up 15.3% on average since the latest earnings results.
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 $358.5 million, up 7.7% year on year. This print exceeded analysts’ expectations by 1.8%. Overall, it was a strong quarter for the company with a solid beat of analysts’ EBITDA estimates and full-year revenue guidance meeting analysts’ expectations.
“Our first quarter results demonstrate the strength of our services business and the progress we’ve made against our product roadmap,” said Jeremy Stoppelman, Yelp’s co-founder and chief executive officer.
Unsurprisingly, the stock is down 4.3% since reporting and currently trades at $34.20.
Is now the time to buy Yelp? Access our full analysis of the earnings results here, it’s free.
Best Q1: Nextdoor (NYSE:KIND)
Helping residents figure out what's happening on their block in real time, Nextdoor (NYSE:KIND) is a social network that connects neighbors with each other and with local businesses.
Nextdoor reported revenues of $54.18 million, up 1.9% year on year, outperforming analysts’ expectations by 1.8%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ number of weekly active users estimates.
The market seems happy with the results as the stock is up 15.2% since reporting. It currently trades at $1.74.
Is now the time to buy Nextdoor? Access our full analysis of the earnings results here, it’s free.
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 $855 million, up 15.5% year on year, exceeding analysts’ expectations by 1%. Still, it was a mixed quarter as it posted revenue guidance for next quarter meeting analysts’ expectations.
Pinterest delivered the weakest performance against analyst estimates in the group. The company reported 570 million monthly active users, up 10% year on year. Interestingly, the stock is up 27% since the results and currently trades at $35.41.
Read our full analysis of Pinterest’s results here.
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 $1.36 billion, up 14.1% year on year. This result surpassed analysts’ expectations by 1.3%. It was a strong quarter as it also recorded a solid beat of analysts’ EBITDA estimates and solid growth in its users.
The company reported 460 million daily active users, up 9% year on year. The stock is flat since reporting and currently trades at $9.14.
Read our full, actionable report on Snap 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 $392.4 million, up 61.5% year on year. This number topped analysts’ expectations by 6.2%. Overall, it was a strong quarter as it also logged EBITDA guidance for next quarter exceeding analysts’ expectations.
Reddit delivered the biggest analyst estimates beat and fastest revenue growth among its peers. The company reported 50.1 million daily active users, up 20.7% year on year. The stock is up 22.6% since reporting and currently trades at $145.55.
Read our full, actionable report on Reddit here, it’s free.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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