Snap soared after an earnings report that beat analyst expectations, with shares jumping up to 28 percent during after-hours trading.
The company reported Q4 earnings on Tuesday after the bell:
Though the company is still not profitable, it grew revenue 72 percent year-over-year and showed a 46 percent increase year-over-year in revenue ARPU. Cash burn decreased to $225 million, down 49 percent from the previous quarter. Shares at one point traded above the $17 initial public offering price set in March 2017.
Snap announced during the previous quarter it was redesigning its app to attract new users and usher in new ways to monetize its app. It began slowly rolling out changes in November 2017. Recently it announced would allow users to share some content across Twitter and Facebook, a first for the app which was initially built around disappearing messages.
GBH Insights chief strategy officer Daniel Ives said in a note the redesign should help attract older users, a key advertising target. He added advertisers are overall positive on the company, indicating sales and ad prices should increase. However, he acknowledged Snap faces many issues, including ARPUs that are below industry averages and competition from other social networks like Instagram, Facebook and Twitter. Instagram Stories, Facebook's Snapchat competitor, announced 300 million daily active users in November, although some reports have indicated users spend more time on Snap than on its rival.
Disclosure: CNBC parent NBCUniversal is an investor in Snap.