After a difficult year, Snap SNAP is set to report earnings today and it will be the first chance this cycle to take the temperature on a social media company.
Here's what analysts are expecting to see from Snap, as compiled by Bloomberg.
Snap's 2022 was unique in a rough year for Big Tech as a whole. The company's shares fell by around 80% during 2022, as it was rattled by slowed digital advertising, high inflation, and fast-growing competition from TikTok.
As of Q 3 2022, Snap had 363 million DAUs, up 19% year-over-year at the time.
In August, Snap laid off 20% of its workforce, a move that affected 1,300 employees. The company made exclusive short shows that included the axing of its drone camera Pixy and Snap Originals, which included the high-profile cuts. Snap also shuffled its executive team around the time.
In the next day and a half, investors will learn a lot about where the social media business is currently, with Meta META reporting tomorrow. The company's stock dropped by about 63% over the course of the year in 2022, as the company's parent had a rough 2022.
It's worth noting that the stakes are particularly high for Snap. On the heels of its terrible year, the company has seen a number of downgrades recently, including from Citizens-owned JMP Securities this month, from Outperform to Hold. Andrew Boone, a JMP analyst, said the move was a long time coming.
The downgrade shows our preference for Meta valuation and Google search has higher revenue visibility over Snap, while both have more mature short-form video products, which we expect to attract more traffic over the next few years, Boone wrote in a note to clients.
In December, Jefferies downgraded Snap from Buy to Hold, citing concerns about how the company can stand up to competition.
Wall Street doesn't expect Snap to give guidance too far into the future, because of the uncertainty in the Ad market, Evercore analyst Mark Mahaney wrote recently.
He wrote that Snapchat's higher exposure to industries like media and retail, which have pared back ad spending despite slowing macroeconomic growth, may hurt its Ad Pricing versus Social Media rivals.
Allie Garfinkle is a senior tech reporter at Yahoo Finance.