Looking back on social networking stocks' Q1 earnings, we examine this quarter's best and worst performers, including Nextdoor (NYSE:KIND) and its peers.
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 an ok Q1; on average, revenues beat analyst consensus estimates by 3.5%. while next quarter's revenue guidance was 1.3% above consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, but social networking stocks have shown resilience, with share prices up 9.9% on average since the previous earnings results.
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 $53.15 million, up 6.8% year on year, topping analysts' expectations by 4.6%. It was a decent quarter for the company, with optimistic revenue guidance for the next quarter but slow revenue growth.
The stock is up 6.9% since the results and currently trades at $2.41.
Is now the time to buy Nextdoor? Access our full analysis of the earnings results here, it's free.
Best Q1: 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 $1.19 billion, up 20.9% year on year, outperforming analysts' expectations by 6.6%. It was a very good quarter for the company, with a solid beat of analysts' revenue estimates and strong sales guidance for the next quarter.
Snap scored the biggest analyst estimates beat among its peers. The company reported 422 million daily active users, up 10.2% year on year. The stock is up 32.7% since the results and currently trades at $15.13.
Is now the time to buy Snap? Access our full analysis of the earnings results here, it's free.
Weakest Q1: 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 $332.8 million, up 6.5% year on year, falling short of analysts' expectations by 0.2%. It was a weak quarter for the company, with slow revenue growth and a miss of analysts' revenue estimates.
Yelp had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is down 7.9% since the results and currently trades at $36.52.
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 $740 million, up 22.8% year on year, surpassing analysts' expectations by 5.7%. It was a very good quarter for the company, with a solid beat of analysts' revenue estimates and strong sales guidance for the next quarter.
The company reported 518 million monthly active users, up 11.9% year on year. The stock is up 23.7% since the results and currently trades at $41.38.
Read our full, actionable report on Pinterest here, it's free.
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 Facebook Reality Labs.
Meta reported revenues of $36.46 billion, up 27.3% year on year, in line with analysts' expectations. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter.
Meta achieved the fastest revenue growth among its peers. The stock is down 6% since the results and currently trades at $464.04.
Read our full, actionable report on Meta here, it's free.
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