Snap (SNAP) Stock Forecast & Price Target

Snap has demonstrated a positive financial trajectory, with third-quarter sales rising 9.8% year-over-year to $1,507 million, surpassing guidance expectations. User engagement metrics improved, as evidenced by the growth in global monthly active users (MAUs), which reached 943 million, indicating a robust increase from the previous quarter. Additionally, the rise in average revenue per user (ARPU) across key regions, particularly a 19% year-over-year increase in Europe and a successful expansion of Snapchat+, further underscores the company's strengthening advertising revenue and premium service offerings.

Snap's financial outlook remains negative due to a projected decline in average revenue per user (ARPU), which is estimated at $2.77 for 3Q, reflecting a year-over-year decrease of 2%. Furthermore, the anticipated slowdown in North American daily active users (DAUs) and the revision of the stock-based compensation outlook indicate ongoing challenges in user retention and monetization. Additionally, the anticipated user growth of only 3% year-over-year for FY26, down from 9% in FY24, underscores the firm's vulnerability to competition from short-form video platforms, especially in its most profitable market.