Snap (SNAP) is retreating nearly 7% after the company provided first-quarter adjusted profit guidance that was well below analysts' average estimate. However, the firm's Q4 financial results did come in above their mean outlook.

Snap owns the Snapchat social media app and website.

A Look at Snap's Q1 Guidance and Its Q4 Results

The company expects to generate Q1 profit, excluding certain items, of $40 million to $75 million, well below analysts' average outlook of $78.5 million. The company blamed its "investment plans" for the relatively weak guidance. However, the company's Q1 revenue outlook was in line with analysts' mean estimate.

In Q4, Snap generated earnings per share of 16 cents, meaningfully above analysts' average estimate of 14 cents. What's more, its revenue came in at $1.56 billion, slightly above the average estimate of $1.55 billion.

Snap's Comments

“As we look ahead to 2025, we see additional opportunities to invest productively in scaling our business given the foundational improvements we have made to our ad platform and the momentum we have established in our go to market initiatives,” the company stated in its investor letter.

CEO Evan Spiegel indicated that Snap had been helped by the uncertainty surrounding the fate of TikTok's U.S. business.

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Disclosure: None. This article is originally published at Insider Monkey.