Shares of Snap Inc. advanced 0.8% to $5.26 in Monday's premarket session, buoyed by the announcement of a new advertising partnership with luxury brand Gucci.
The collaboration introduces what Snap describes as the luxury sector's first Sponsored AI Lens on Snapchat. This format utilizes the company's proprietary generative artificial intelligence to create branded camera effects, allowing users to transform into characters from Gucci's "La Famiglia" collection.
This initiative represents a strategic push by Snap to expand its camera-driven advertising business. The company is aiming to diversify its revenue streams by attracting more interactive ad budgets from marketers, thereby reducing its reliance on a small group of major advertisers.
Snap's latest financial results showed a 10% year-over-year revenue increase to $1.72 billion for the fourth quarter, with active advertisers growing by 28%. However, its first-quarter revenue outlook fell short of analyst expectations, highlighting ongoing challenges in competing for large enterprise ad budgets against bigger rivals.
The market reaction unfolds against a backdrop of investor caution. Broader stock futures edged lower as Wall Street prepares for key economic indicators. The focus is squarely on Wednesday's delayed January nonfarm payrolls report and Friday's consumer price index data, both seen as critical gauges for future monetary policy and risk appetite.
