Threads Declines Stabilize, While META and SNAP 2Q23 Earnings Mixed

Key Takeaways:

• ST data shows Threads DAUs, time spent, and sessions (as of July 25) are all down more than 75% compared to the launch-fueled peak on July 6, though declines have recently stabilized

  • Competitor X (f/k/a Twitter) and sister app Instagram have not experienced a material impact to DAUs, time spent, or sessions since Threads’ launch (July 6)

• Meta smashed 2Q23 EPS and revenue estimates: ST data corroborated strengthening engagement for both Facebook and Instagram, with total hours engaged increasing 10% and 22% YoY, respectively, in 2Q23

  • ST Facebook Blue DAUs and MAUs in 2Q23 (both +2% YoY, +1% QoQ) increased inline with the company’s reported Facebook DAUs (+5% YoY, +1% QoQ) and MAUs (+3% YoY, +1% QoQ)

• Snapchat’s 2Q23 global revenue fell 4% YoY and 13% YoY in North America; per the company large advertisers have pulled back significantly on spend since Snap began to adjust its ad network

  • Pathmatics by ST data corroborates a pullback in spending YoY amongst some of the largest advertisers on Snapchat in 2Q23, with six out of the top advertisers (by US ad spend) from 2Q22 decreasing their levels of ad spend on the platform by a collective 47% YoY in 2Q23

• ST DAU estimates for Snapchat (+13% YoY, +4% QoQ) increased inline with the company’s reported global DAUs (+14% YoY, +4% QoQ), marking another consecutive quarter of double-digit best-in-class user growth; this was driven by strong growth in rest of world with 2Q23 DAUs in India and Pakistan rising 33% and 45% YoY, while US DAUs remained largely flat, which was in line with ST estimates

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