Social media company Snap posted its first quarterly profit Thursday (Feb. 3) and suggested that it is dealing with how Apple’s new privacy policy changes shook up the digital ad world.
As the Wall Street Journal (WSJ) reported, Snap posted a net profit of $22.6 million, following a 42% increase in sales to $1.3 billion when compared to the same time last year, coming in ahead of Wall Street expectations.
Additionally, the report says Snap saw its daily active users on Snapchat increase 20% year over year.
The company’s shares had been hit hard after Meta’s announcement that it would lose $10 billion in revenue this year due to the software changes Apple made to ad tracking through its iOS software.
Read more: Meta Earnings Hit By Metaverse Investments As Stock Plunges 20%
However, Snap saw its shares rally following the earnings release, rising more than 50% in after-hours trading. That came after a 24% drop on Thursday, as technology stocks were sold off broadly amid some disappointing earning reports.
Snap Chief Financial Officer Derek Andersen told the WSJ some of the company’s advertising business “began to recover from the impact of the iOS platform changes quicker than we anticipated.”
After Apple introduced its software changes last year, a number of social media platforms — Snap, Facebook, Twitter and YouTube among them — reported losing billions due to Apple’s App Tracking Transparency policy on iPhones.
The policy requires apps to ask permission before tracking user activity and sending out personalized ads. Many users have opted out, which has left advertisers scrambling to find other ways to connect with users.
As for Snap, the company says it is working on tools to help advertisers deal with these challenges, the WSJ report said.
“We are pleased with the early progress,” said Jeremi Gorman, Snap’s chief business officer, although he added it would take time to completely adjust.
See also: Snap Launches Shopping Lenses to Improve Product Browsing
Last month, Snap launched a new type of Shopping Lens that lets users swipe through multiple products and browse details on pricing, color, sizing and similar items from a retailer.
Ulta Beauty and MAC Cosmetics were the first brands to use the new Lenses, the company said, although several other companies plan to add their own swipeable Shopping Lenses in the coming months.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More