Snap CEO Evan Spiegel: AI Glasses Mass Adoption Years Away Despite Strong Q2 Revenue Growth

Snap Stock Soars 7.76% After Hours: CEO Says Glasses Mass Adoption Is Years Away - Snap (NYSE:SNAP)

Snap's $2,195 Glasses Will See 'Mass Market Adoption' By End of Decade, Says CEO Evan Spiegel: 'Designed For a Future in Which AI Does More Work' Mass Market Adoption May Take Years Speaking on the company's second-quarter earnings call, Spiegel said Snap plans to unveil its augmented reality glasses at its Sept. 16 event before a commercial launch later this year. "I think it will be towards the end of the decade before we see mass market consumer adoption," the CEO told analysts. Spiegel added that the company remains focused on demonstrating the long-term value of its investment in specs as it works to build a new computing platform powered by AI. The Future of AI Means Less Time Operating Screens "Specs are designed for a future in which AI does more work on our behalf, and people spend less time operating screens," Spiegel said. He described it as a first-mover opportunity in a new computing category, built around software that increasingly works on users' behalf rather than requiring them to spend more time navigating apps and screens. Q2 Tops Wall Street Estimates Revenue rose 19% year over year to $1.6 billion, topping analysts' estimates of $1.54 billion. The company expects revenue for the third quarter of around $1.70 billion to $1.74 billion, compared to Wall Street's forecast of $1.69 billion. The quarter's adjusted EBITDA is expected to be in the range of $300 million and $350 million. Price Action: SNAP closed 7.46% higher on Monday at $5.04 and rose another 7.17% in extended trading as the news of the earnings came in after the bell. Benzinga edge rankings indicate SNAP has a Momentum score in the 5th percentile and a negative price trend across the short, medium, and long term. Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Photo Courtesy: NYCStock on Shutterstock.com Market News and Data brought to you by Benzinga APIs To add Benzinga News as your preferred source on Google, click here.

Snap CEO Sees New Wearable Glasses as "Largest Long-Term Opportunity

Shares of Snap were up 12 percent after hours Monday as the social media platform beat second-quarter revenue expectations. Revenue increased 19 percent year-over-year to $1.60 billion, as monthly active users grew to 971 million, up from 956 million in the prior quarter, and daily active users reached 493 million, up from 483 million in the prior quarter. The company reported a net loss of $164 million, after a net loss of $263 million in the prior year, as part of its renewed focus to reach profitability. But beyond the current revenue growth that's being seen around the app, and the company's new "more focused, AI-enabled operating model." CEO Evan Spiegel outlined that he sees the company's future in its newest version of wearable technology. "Our largest long-term opportunity is SPECS, a new kind of computer built into see-through glasses. SPECS are designed for a future in which AI does more work on our behalf and people spend less time operating screens. I believe we can pursue that future from a much stronger position by continuing to improve our core business and remaining disciplined about how we invest," Spiegel said in the press release. Snap announced the new wearable glasses in June, setting up pre-orders of the $2,195 glasses with expected shipment this fall in the United States, United Kingdom, and France. The glasses were described as a mix of other AI glasses and VR headsets, offering tech such as directions, AI assistance, the ability to stream content and overlay interactive lessons onto surfaces. The glasses don't officially launch until Sept. 16. Still, Snap has attempted glasses in the past and has not seen big returns. The company launched Spectacles, camera-equipped sunglasses that recorded short videos, in 2016. These were not big sellers and caused the company, in 2017, to report losses due to excess orders. The company later released updated versions of the glasses and then new AR glasses in 2021. The company said the investment in SPECS is included in its full-year adjusted operating expense outlook, which remains $2.75 billion. Snap's guidance range for Q3 revenue is $1.70 billion to $1.74 billion, and the company also expect infrastructure costs to grow modestly with full-year costs of $1.65 billion to $1.70 billion due to continued investments in the company's AI-enabled operating model. All of this comes after the company laid off 1,000 employees, including 16 percent of full time employees, were laid off at the company in April. The company said the layoffs would reduce the company's annualized cost base by more than $500 million by the second half of 2026, which would help the company get closer to profitability. "Last fall, I described Snap as facing a crucible moment, requiring a new way of working that is faster and more efficient, while pivoting towards profitable growth. Over the past several months, we have carefully reviewed the work required to best serve our community and partners and made tough choices to prioritize the investments we believe are most likely to create long-term value," Spiegel said at the time.