Snap Inc. (SNAP) shares surged 23.29% in after-hours trading on Wednesday, following the release of its third-quarter 2025 financial results that surpassed analysts' expectations. The company also announced a strategic AI partnership and a substantial stock repurchase program, further boosting investor confidence.

The social media giant reported Q3 revenue of $1.51 billion, exceeding the IBES estimate of $1.49 billion. Snap's Daily Active Users (DAUs) reached 477 million, slightly above the expected 476.3 million. The company's Adjusted EBITDA of $182.038 million significantly outperformed the IBES estimate of $126.1 million, demonstrating improved profitability despite a net loss of $103.541 million for the quarter.

Looking ahead, Snap provided a robust Q4 revenue outlook of $1.68 billion to $1.71 billion, in line with analyst expectations. The company also announced a partnership with Perplexity to bring conversational AI search to Snapchat, starting in early 2026. This strategic move into AI technology is expected to contribute to revenue growth beginning in 2026. Additionally, Snap authorized a stock repurchase program of up to $500 million of its Class A common stock, signaling confidence in its long-term prospects and commitment to delivering shareholder value.