India expansion helping Snap build for global markets as it records first profitable quarter ever

Snap Inc, the holding company behind image-driven social media network Snapchat, is using the knowhow it has garnered from expanding its products in India to build on community engagement exercises across the world. Talking to investors at the earnings call, Evan Spiegel, chief executive of Snap, also revealed that the company’s recent efforts have helped it record its first profitable quarter ever – since launching in 2011.

“Our expansion efforts in India continue to prove successful, and we are using our learnings to inform how we approach community growth in new geographies,” Spiegel said on Friday, February 4.

Snap reported revenue of $1.3 billion in Q4 2021, which grew 42 percent year on year. Its annual revenue for 2021 hit $4.1 billion, growing at 64 percent year on year. This was Snap’s first-ever profitable quarter, with the company reporting $22.6 million in net profits for Q4. The company also noted that its daily active users grew to 319 million in this quarter – marking it as the fifth consecutive period of such growth.

According to Snap, its growth has been driven by the social platform pivoting to an augmented reality-driven content creation and sharing medium. Snapchat has also adopted the short videos format, which too has reportedly contributed to its growth. Interestingly, Jeremi Gorman, Snap’s chief business officer, stated that while the platform continues to work around Apple’s App Tracking Transparency (ATT) move, it still recorded an all-time high figure of active advertisers on its platform during the quarter.

Snap’s report comes at a time when the Facebook group reported a decline in its daily active user count for the first time ever. At the Meta Platforms earnings call, Facebook chief Mark Zuckerberg noted that a rising volume of competition from social platforms around the world, coupled with Apple’s ATT adoption, have haltered the brand’s progress in various parts of the world.

In India too, digital marketers believe that the rising prevalence of ‘younger’ platforms, and the continued dominance of YouTube, have caused Facebook to go down the pecking order in terms of being the social network of choice.

Big Tech’s latest earnings calls have also reflected on the rising importance of the Indian internet users on global parlance. In its Q4 2021 report, Alphabet, the parent company of Google and YouTube, spoke about how building for India is helping the company take many products to a global scale. Alphabet and Google chief, Sundar Pichai, stated that after Google Pay (erstwhile Tez), the company is looking to premiere new monetisation tools for content creators on YouTube in India first – before taking the learnings from this market and implementing them on a global scale.

Snap’s Spiegel found himself on the hit list of Indians after allegedly calling India “too poor” a market for his platform. Since then, the company has denied such allegations, and since 2019, has made a renewed push to focus on India by offering lenses and filters built specifically for the country. It has also offered its platform in nine Indian languages so far, among other moves to appeal to users.