Snap's direct revenue hits $1 billion annualised run rate as subscribers top 25 million

Snap said on Wednesday its direct-revenue business has reached $1 billion in annualised revenue run rate, driven by growth in its Snapchat+ subscription service, as the social media company pushes into new income streams beyond advertising.

The company, whose direct-revenue portfolio spans Snapchat+, the Memories photo and video archive ‌tool and ⁠in-app ⁠purchases, said its total subscriber count has surpassed 25 million.

Squeezed by dominant platforms ​such as TikTok and Meta-owned Instagram in a crowded social media market, Snap ​is turning to subscriber growth to boost revenue, particularly as some major clients scale back advertising on smaller services. Ad sales ​constitute a majority of the company's revenue.


CEO ⁠Evan Spiegel ‌had said last year Snap was in a "crucible moment" after its quarterly revenue growth slowed and outlined his ⁠ambition to make direct revenue "a durable multi-billion-dollar growth driver for Snap."

The company said on Tuesday it would launch a subscription feature allowing creators to generate recurring income directly from their most loyal fans, beginning with a February 23 test involving a small cohort of Snapchat creators in the U.S.

Snapchat+, launched in 2022, offers customization features, including pinning best ‌friends, custom chat wallpapers and AI-powered pet avatars Bitmoji Pets, to enhance user engagement and retention.

The company ​has said ​its total active ⁠advertisers on the platform rose 28% in the fourth quarter.

Daily active users of Snapchat rose 5% to 474 million during the quarter, but ​they fell by 3 million from the prior three-month period, the company said earlier this month.

Last month, Snap unveiled Specs, an independent subsidiary for its augmented reality smart glasses, in a bid to challenge Meta in the fast-growing wearables market.