Snapchat Targeting USD 300 Million in Revenue
Messaging app Snapchat, as per reports, is moving towards significantly ramping up revenue in the coming year. Snapchat is targeting between $300 million and $350 million in revenue in 2016, according to a report published in the ReCode. If this were to be true this will mark at least six or seven times jump to its previous year revenue of $50 million it reportedly achived.
According to ReCode, the company hit a $100 million revenue run rate in Q4, which is generally the strongest quarter for the company. If these numbers are tends are right than this, to a large extent, explain investor bullishness on Snapchat which value it at a massive $16 billion.
So far Snapchat has introduced various revenue streams, including advertiser-sponsored stickers for selfies, news service “Discover” that runs ads next to curated news from large publishers, and Live Stories that allows advertisers to sponsor a montage of photos and videos around a particular event.Snapchat’s interest in ad technology may be one of the reasons the 2016 numbers are expected to be higher. Automating some of those ad sales through an API would make it much easier for marketers to buy ad space inside Snapchat.
Stabilizing these revenue numbers will be key for the company. CEO Evan Spiegel said in May that the company has an IPO plan in place, and Wall Street likes consistency in revenue numbers. However, this contnues to be a key concern for the company as a large part of jump in 2016 revenue could be coming thanks to the 2016 elections. Bernie Sanders ran a nine-day Snapchat campaign before the Iowa caucuses. Ted Cruz used Snapchat to troll fellow Republican candidate Donald Trump. Snapchat hired a political ad salesperson in 2015 for this very reason.