Snap shares rocket 28% as company reports unexpected profit [Video]

Snap shares surged 28% on Friday after the company surprised Wall Street by showing a profit and reported sales and user numbers that exceeded analysts’ estimates.

The stock climbed $3.15 to close at $14.55, its biggest percentage gain since 2022. Even after the rally, the stock is down 14% for the year due to a 31% plunge in February.

Revenue in the first quarter increased 21% to $1.19 billion from $989 million a year earlier, topping analysts’ estimates for sales of $1.12 billion, according to LSEG.

The company reported adjusted earnings per share of 3 cents, while analysts were expecting a 5-cent loss. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $46 million, compared to analysts’ expectations for a loss of $68 million.

Snap said adjusted EBITDA “exceeded our expectations” and was primarily driven by operating expense discipline, as well as accelerating revenue growth.

Snap has been working to rebuild its advertising …