Evercore Cuts Target to $9 While Snap Reports 10.2% Q4 Revenue Growth
Snap reported Q4 2025 earnings of $0.03 EPS and 10.2% year-over-year revenue growth to $1.72 billion, beating expectations. Evercore ISI cut its price target from $13 to $9 while B. Riley upgraded to Buy and the company launched a substantial share buyback after shares hit a record $5.90 low.
1. Analyst Ratings Shuffle
Evercore ISI maintained a Mixed grade on Snap Inc., revising its 12-month price target downward from $13 to $9, citing a cautious outlook on user growth and advertising demand. In contrast, B. Riley upgraded Snap to a Buy rating following the company’s Q4 earnings, pointing to improved monetization trends and a positive trajectory in average revenue per user. These divergent assessments reflect a split on Wall Street over Snap’s ability to sustain profitability against intensifying competition from larger social platforms.
2. Q4 Earnings Beat Expectations
In the fourth quarter of fiscal 2025, Snap reported adjusted earnings of $0.03 per share, topping consensus forecasts for a breakeven result. Revenue climbed 10.2% year-over-year to $1.72 billion, slightly above analyst projections. Key drivers included a 5% increase in global ARPU to $3.62 and a 62% surge in subscription and other revenue to $232 million, while advertising revenue rose 5% to $1.48 billion. The company’s adjusted EBITDA expanded 30% year-over-year to $358 million, underscoring margin improvement efforts.
3. Share Buyback and Capital Deployment
Snap’s board authorized a $500 million repurchase program of Class A common stock, to be executed over the next 12 months via open-market and negotiated transactions. This initiative leverages Snap’s $2.9 billion cash and marketable securities balance and aims to offset dilution from employee restricted stock units. The repurchase program signals management’s confidence in ongoing cash-flow generation, following free cash flow of $206 million in Q4 and $437 million for the full year 2025—a 100% increase over the prior year.
4. Regional Revenue Contributions
North America, representing 60% of total revenue, delivered 6% year-over-year growth to $1.03 billion, driven by higher ad spend from small and medium-sized businesses. European revenues, making up 20% of the mix, surged 19% to $341 million, supported by expanded adoption of dynamic product ads and AI-powered campaign tools. Emerging markets contributed the remaining 20%, with double-digit growth in Latin America and Middle East regions. Despite user growth headwinds in mature markets, international revenue diversification remains a key lever for Snap’s top-line resilience.