Snapchat did beat expected earnings, but it was not in any way impressive. However, Snapchat did make the headlines because it showed to investors that the ad industry fuelled primarily by small businesses was still booming, although not for long. What was not given much importance was the decline of Snapchat ad revenue spending, which declined significantly month to month leading up to April. With that said, Snapchat is still unprofitable even with the earnings beat and doesn't have much market growth potential given the market saturation of video communication apps. Snapchat also has a whopping $24B valuation, which compared to Air Canada at a current valuation of $4 billion is shocking. Compared to other technology giants such as Facebook with a valuation of $500B, Snapchat's market seems widely overvalued at approximately 1/20th Facebook size. Snapchat without a large global presence and limited cost-cutting tactics have limited strategies for becoming profitable. Even with this boom, a growing user base can result in increased costs due to additional server space required, which their target demographic of millennials and youths will unlikely fund.