Santa Monica, April 27, 2026, 10:04 PDT
Snap Inc. shares jumped roughly 8.5% Monday, lifted by Rothschild & Co Redburn’s rating boost to Buy from Neutral. The firm also hiked its price target for the Snapchat owner all the way to $10, doubling the previous level. Lately, the stock traded at $6.13—well off its 52-week high, but making a strong move higher on the session.
This call has taken on new weight as Snap pushes to reshape itself into a slimmer, more profitable player in ads and subscriptions ahead of first-quarter earnings next week. Investors are sizing up whether April’s layoffs and a new AI-focused cost strategy will be enough to rewrite the company’s narrative, which has so far been marked by choppy advertising growth and stiff competition from larger rivals.
Rothschild & Co Redburn analysts Joseph Barker and James Cordwell describe the latest moves as evidence that “AI is driving a bifurcation” in online advertising. Meta, they note, keeps stretching its lead while smaller players scramble to close the gap. Redburn has upgraded Snap, lowered its view on Pinterest to Neutral, and maintained a Sell on Reddit. Among the group, Snap stands out, according to their note, both for its ability to diversify revenue and for a subscription business already exceeding $1 billion a year. They also predict Snap’s core advertising could turn the corner—shifting from a projected operating loss in 2025 to profit by 2027. Investing.com
The upgrade hands investors a new angle on Snap shares following a tough year. Even with Monday’s move higher, Finviz data had the stock sitting roughly 14% below its 200-day average. The Rothschild Redburn note, meanwhile, marked the day’s only analyst rating shift for Snap.
Snap’s fourth-quarter numbers gave a nod to the profit case. Revenue climbed 10% from the prior year to $1.716 billion, with net income landing at $45 million. CEO Evan Spiegel pointed to a “strategic pivot toward profitable growth” — citing both margin expansion and moves to diversify revenue. Snap Inc. Investor Relations
Snap’s business isn’t just about advertising. The company said monthly active users climbed to 946 million in the fourth quarter. “Other revenue” shot up 62% to $232 million, with subscriber numbers jumping 71% to 24 million. Sponsored Snaps—the ad unit built into its messaging app—delivered higher click-through and purchase rates between the third and fourth quarters. Snap Inc. Investor Relations
Snap’s slicing expenses at speed. In an April 15 staff memo, CEO Evan Spiegel announced plans to axe roughly 1,000 jobs—around 16% of the full-time workforce—and scrap over 300 open positions. The company’s aiming to shave more than $500 million off its annualized cost base by the back half of 2026, Spiegel told employees, crediting artificial intelligence for trimming repetitive tasks.
That reset brings a shift at the top. Snap says Derek Andersen will handle his final earnings call as CFO on May 6, wrapping up for good on May 8. Doug Hott, who’s spent almost seven years working alongside Spiegel on strategy, capital moves, and restructuring, is set to step in.
Still, the wager is messy. “Long-suffering shareholders” might get a break from cost-cutting, Russ Mould, investment director at AJ Bell, told Reuters, but he’s not convinced Snap can carve out a sustainable, profitable business. The company, according to Reuters, is bracing for $95 million to $130 million in charges tied to layoffs, with most of that hitting in the second quarter. Reuters
Regulatory pressure remains a key issue for social platforms courting younger audiences. Manitoba’s premier announced plans to bar youth from social media and AI chatbot use, according to Bloomberg, joining a broader governmental effort to curb youth access to big tech services.
Snap’s next hurdle arrives after the bell on May 6, with first-quarter numbers and a 2 p.m. Pacific Time call on deck. Right now, investors are buying into a hint of profit momentum for the Snapchat parent—not confirmation.
