As part of its Q1 2024 earnings release, Snap disclosed that total watch time on its TikTok competitor, Spotlight, more than increased by 125% year-over-year. Snapchat introduced the TikTok-like feed in late 2020 as part of its attempts to compete with the rising popularity of TikTok. The firm is triumphantly touting success of its short-from video feed a day after President Biden inked a bill that would ban TikTok, if its Chinese parent company, ByteDance, fails to sell it within a year.

Snap said overall time spent watching content globally increased year-over-year, largely driven by increases in total time spent watching Spotlight and creator Stories. The company said it has built more advanced ranking models over the past year that are driving improvements in content engagement.

During its analysts' call, CEO Evan Spiegel referred to the company's goal of surfacing more topical content going forward.

“I think there’s work to be done to make our content experience feel more timely and topical, and then we’re spending a lot of focus on the creator journey overall,” he said.

That journey from using Snapchat to communicate with 100 friends to growing a following of millions. And really making sure that people are creating great stories or great Spotlight content can be discovered and then grow that following and ultimately build a business over time.

The app had 422 million DAUs in Q1 2024, up 39 million, or 10% year-over-year. Snapchat+ subscribers more than tripled year over year in the quarter, exceeding 9 million subscribers.
Snap believes that investments in the development of generative AI models for the creation of Lenses on its platform will continue, and it states that the number of ML and AI Lenses viewed by users surged by more than 50% year-over-year.

The company's revenue for the quarter advanced by 21% to $1.195 million and it's back to making double-digit growth. In a letter to investors, Snap attributes its growth to the improvement it made on its advertising platform besides seeing an upward demand for its direct-response (DR) advertising solutions. The company says the number of small and medium-sized advertisers on Snapchat increased 85% year-over-year.

Snap shares rose more than 26% in extended trading on Thursday.

The company, which laid off 10% of its workforce in February, now says it expects headcount to "grow modestly as we move through 2024."

Snap's earnings release comes a day after Meta reported 27% growth for its first quarter. However, Meta's shares plunged on weak revenue guidance and plans to invest "aggressively" in AI.