Snap Inc. published a financial report for the second quarter of 2025, which brought corporate revenue to $1,345 million, an increase of 9 per cent over the same period. However, the net loss increased to $263 million. Its core product, Snapchat, continues to make progress in terms of user growth and profitability, but profitability remains a challenge.
The global user base of Snapchat continued to expand in the second quarter of 2025, reaching 932 million active users per month, an increase of 7 per cent over the same period, and 469 million active users (DAU) per day, an increase of 9 per cent over the same period, with about 9 million new DAUs. In the Asia-Pacific region in particular, there has been a significant increase in Snapchat users, with India becoming the largest market for 202 million users, accounting for 36 per cent of global users. Young users (13-34 years) remain the core group of Snapchat, accounting for 90 per cent of the United States base of users, with 38.1 per cent of users aged 18-24.
Enhancement of reality (AR) functions is a key driver of Snapchat user growth. According to the press, communities use the AR filters 8 billion times a day, with an average of 350 million users interacting with AR each day, and the monthly live users of AR games exceed 175 million, an increase of more than 40 per cent over the same period. The introduction of new AI-driven AR filters, such as campus photos in the 1990s and cartoon world, with over 1 billion cumulative views, highlights the technical advantages of Snapchat in the AR field. Snap also plans to launch its first consumer-oriented AR glasses (Specs) in 2026, further deepening its distribution in AR markets.
Snap received $1.345 billion in the second quarter, an increase of 9 per cent over the same period, in line with Wall Street’s projection of $1,350 million. Advertising revenues account for the bulk of total revenue, with the effect (direct-response advertising) showing a particularly strong performance, with the purchase of commercial advertisers increasing by 39 per cent over the same period, and the related advertising revenues increasing by more than 25 per cent. The introduction of new “Sponsored Snaps” and “First Snap” advertising formats, as well as Snapchat smart advertising solutions, have significantly increased the rate of advertising conversion. In addition, the continued growth in the number of small and medium-sized advertising clients provides an important support for revenue collection.
With regard to non-advertising income, Snapchat+ subscription services showed remarkable performance, with an increase of 64 per cent over the same period. The newly launched Lens+ subscription level provides users with an exclusive AI video filter and a Bitmoji game filter, further contributing to the growth in subscription income. By the second quarter of 2024, Snapchat+ had 11 million subscribers, demonstrating its potential for diversified sources of income.
However, the average user income (ARPU) was $2.87, slightly lower than the analyst ‘ s expected $2.90, and was largely hampered by a 2 per cent (to 98 million) decline in DAU in North America. In addition, an erroneous update of the advertising technology system led to the settlement of some advertisements at lower prices, affecting income performance.
Snap ‘ s profitability remains under pressure despite robust revenue collection and user growth. The net loss in the second quarter was $263 million, a slight increase from $249 million in the same period last year; the adjusted EBITDA was $41 million (3 per cent) compared to $55 million (4 per cent) in the same period last year. High operating costs and AI infrastructure investment are the main causes. Snap anticipates an 11-12 per cent increase in operating costs in the third quarter, mainly for recruitment, legal fees and marketing expenses.
Snap expects DAU to reach $476 million in the third quarter of 2025, with revenues projected at $1,475 million to $1,505 million, an increase of 10 to 12 per cent over the same period. The company plans to introduce a “simplified Snapchat experience” to enhance accessibility and user-friendliness, as well as to increase input into AR and AI, including enhancing AR glasses and simplifying AR creation tools.
