Snap’s shares jumped as it topped revenue expectations and landed a $400 million deal with Perplexity, though looming policy changes could weigh on future growth.
What’s going on here?
Snap shares rocketed 18% in premarket trading after topping revenue forecasts for the third quarter and announcing a hefty $400 million artificial intelligence collaboration with Perplexity.
What does this mean?
Snap trimmed its net loss to $0.06 per share, outpacing FactSet estimates and improving on last year’s $0.09 per share deficit. Revenue climbed 10% to $1.51 billion, thanks to a 5% bump in advertising income and a standout 54% surge in non-advertising business. The Perplexity deal marks a big swing on AI, with the answer engine rolling out to Snapchat’s global audience early next year and Perplexity shelling out $400 million in cash and equity. User numbers also impressed: daily active users were up 8% year over year to 477 million, and average revenue per user topped analyst targets. That said, Snap signaled caution for the final quarter, flagging that new regulations and internet policy shifts could put user growth at risk.
Why should I care?
For markets: AI deals keep digital platforms in the game.
Snap’s strong results and fresh partnership with Perplexity show investors are buzzing about tech firms tapping artificial intelligence to unlock new growth. Big-ticket AI deals have the potential to boost engagement and help firms diversify.
The bigger picture: Global rules shake up big tech’s roadmap.
Snap’s massive audience and worldwide reach means it’s tightly linked to how regulators handle privacy, content moderation, and age restrictions. With daily active users nearing half a billion, the company can’t afford to brush off government crackdowns or internet policy shifts—what happens in markets from the US to India could shape Snap’s growth story for years to come.
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Originally Posted November 6, 2025 – Snap Outpaces Forecasts And Strikes A Big AI Partnership
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