Author presents a bullish case for Snap Inc, arguing improving DAUs and monetization plus the AI Spectacles catalyst make the risk/reward attractive despite dilution concerns.
SNAP — LONG The author argues Snap is mispriced because DAUs are up about 15% over the last couple years while the stock is down about 50%, with Snapchat+ generating around $750M a year and a $400M a year Perplexity AI deal improving fundamentals. The catalyst is the AI Spectacles release this year: if the glasses fail and are scrapped, Snap saves roughly $1B a year in R&D, turns cash-flow positive, slows dilution, buys back more stock, and may re-rate; if they work, the upside is bigger. The main stated risk is heavy dilution and cash burn, though the author contends this is a symptom that eases once R&D spending falls and consistent cash flow begins.
If the glasses fail and he scraps them, Snapchat saves roughly $1B a year in R&D, turns cash-flow positive, slows dilution, buys back more stock, and the market probably re-rates the company. If the glasses actually work, the upside is even bigger.