Snap Inc. (NYSE:SNAP) Q3 2023 Earnings Call Transcript

And as a result, it would be imprudent to provide a formal guide in that kind of an environment. However, what we did do for the sake of transparency for the investment community to share our internal forecast, and that internal forecast assumes an acceleration at the top end. But we’ve attempted to incorporate everything that we know as of today about the impact of those pauses into the fullness of the range of revenue so that you can see that. And then, of course, that obviously flows right through to the adjusted EBITDA range as well, because we have a very high rate of flow through on those. So, I think stepping back fundamentally, we’re pleased with the progress we’re making on the DR business. And we’re pleased, we think we’re on the right path with that platform.

And we’re also pleased with the uptake that we saw from those new brand products in Q3 as well. So I think, the progress there is good. We just want to make sure that people are aware of that one headwind we’ve seen to begin the quarter. And hopefully that gives you a little bit of color on how we frame that. Thank you.

Operator: Thank you. Our next question is from Ross Sandler with Barclays.

Ross Sandler: Great. Hey, guys. So, Evan, you recently changed the leadership team in North America ad sales. And that seems like the area that’s not yet caught up with the rest of the business, which is performing quite well. So, I guess, how do you feel about that change? How confident are we that North America larger accounts are going to step up and commit to more budget with Snap in 2024? And when do you expect that growth rate to kind of converge with the international business, if you can help us there? Thanks a lot.

Evan Spiegel: Hey, Ross, thanks so much for the question. Yeah, we are making some progress in North America, the fastest growing region quarter-over-quarter, but obviously, a long way from where we’d like it to be. In general, North America has a number of large customers that are simply just more complex to work with. So, while we’ve made a lot of progress with some of the simpler integrations, our 7/0 optimization and whatnot for smaller advertisers, it’s just taken more of a focus and more in the details work to drive customer success with larger advertisers. So, I’m pleased with the progress that we’re making. We’re fixing stuff every day and getting advertisers closer to hitting their KPIs, or in many cases, above their KPIs, which should translate into improved spend. So making progress there, but definitely more complex customers. And we’re excited about Patrick’s leadership of the team. He’s got a wealth of experience to bring.

Operator: Thank you. Our next question is from Rich Greenfield with LightShed.

Rich Greenfield: Hi, thanks for taking the question. One question and then a housekeeping. In the employee memo that leaked a couple of weeks ago, it stated a goal of 80% of your daily active users interacting with content. Trying to get a handle on how ambitious of a goal that is for 2024 as content engagement would have seemed to be a pretty critical driver of your advertising revenue potential, thinking about where ads are embedded. I don’t have any idea really where you are in terms of how many DAUs touch content today and what would be driving the growth to 80% of overall DAU. So, any color you can give us on that goal and where you are today and changes would be great. And then two, just on the — also in that memo, you mentioned a 20% revenue growth goal for 2024. Evan, is that really hard to do? Like, what’s your confidence goal on getting 20% growth next year? Thanks.