Google-parent Alphabet has exceeded revenue growth expectations, while Snap’s forecast falls short. According to KeyBanc analyst Justin Patterson, Alphabet’s revenue growth for Search and YouTube has surpassed expectations. Patterson noted that YouTube Shorts now reaches 2 billion logged-in users per month, up from 1.5 billion last year. Additionally, brand advertisers are beginning to test ads on the platform, indicating ample room for Google to increase ad revenue. As a result, Patterson raised his target price on Alphabet to $145 from $140 and reiterated an Overweight rating on the stock.
Alphabet’s stock has risen by 6.6% in premarket trading, reaching $130.28. This positive momentum signals a promising future for the technology giant. However, the situation is less optimistic for Snap (SNAP), as its third-quarter revenue forecast has disappointed. While the number of active advertisers for the social-media platform increased by 20% in the second quarter compared to the previous year, large advertisers are still hesitant to join. Patterson expressed caution regarding Snap’s ability to win back advertiser budgets, as larger companies have a competitive advantage in terms of measurement, AI capabilities, and budgets.
Furthermore, Alphabet may pose a threat to Snap in the augmented-reality (AR) business. Patterson pointed out that Alphabet offers tools that enable users to virtually try on items like clothing, creating an advertising opportunity similar to Snap’s existing products. Despite the challenges ahead, Snap shares had a productive year, with a rise of 40% by the end of Tuesday’s close. However, in premarket trading, Snap shares have fallen by 18% to $10.24.
While Google’s revenue growth demonstrates the potential for recovery in the advertising sector, analysts at KeyBanc emphasize that it might not be equally advantageous for all technology companies. Patterson’s cautious outlook highlights the importance of staying vigilant in an ever-changing landscape. For now, Alphabet appears to be on a positive trajectory, while Snap faces obstacles in reclaiming its share of advertiser budgets.
Frequently Asked Questions (FAQs) Related to the Above News
What is the revenue growth expectation for Alphabet?
According to KeyBanc analyst Justin Patterson, Alphabet's revenue growth for Search and YouTube has exceeded expectations.
How many logged-in users does YouTube Shorts reach per month?
YouTube Shorts now reaches 2 billion logged-in users per month, up from 1.5 billion last year.
Are brand advertisers starting to test ads on YouTube Shorts?
Yes, brand advertisers are beginning to test ads on YouTube Shorts, indicating potential for Google to increase ad revenue.
What is the target price set for Alphabet by Justin Patterson?
Justin Patterson raised his target price on Alphabet to $145 from $140.
Has Alphabet's stock price increased in premarket trading?
Yes, Alphabet's stock has risen by 6.6% in premarket trading, reaching $130.28.
How does Snap's third-quarter revenue forecast compare to expectations?
Snap's third-quarter revenue forecast has fallen short of expectations.
Did the number of active advertisers on Snap's platform increase in the second quarter?
Yes, the number of active advertisers for Snap increased by 20% in the second quarter compared to the previous year.
Why are larger advertisers hesitant to join Snap?
Larger advertisers are hesitant to join Snap due to concerns about measurement, AI capabilities, and budgets.
How does Alphabet pose a threat to Snap in the augmented-reality business?
Alphabet offers tools that enable users to virtually try on items, creating an advertising opportunity similar to Snap's existing products in augmented reality.
How have Snap shares performed by the end of Tuesday's close?
Snap shares had a productive year, with a rise of 40% by the end of Tuesday's close.
What is the current price of Snap shares in premarket trading?
In premarket trading, Snap shares have fallen by 18% to $10.24.
Does Google's revenue growth reflect a positive outlook for the advertising sector?
Yes, Google's revenue growth demonstrates the potential for recovery in the advertising sector.
Are all technology companies expected to benefit equally from this recovery?
No, analysts at KeyBanc emphasize that it might not be equally advantageous for all technology companies.
What is the outlook for Alphabet's trajectory?
Alphabet appears to be on a positive trajectory, according to the provided information.
What challenges does Snap face in reclaiming its share of advertiser budgets?
Snap faces challenges in reclaiming its share of advertiser budgets due to competition from larger companies with advantages in measurement, AI capabilities, and budgets.
Please note that the FAQs provided on this page are based on the news article published. While we strive to provide accurate and up-to-date information, it is always recommended to consult relevant authorities or professionals before making any decisions or taking action based on the FAQs or the news article.
