Snap’s
SNAP
Camera recently introduced Christmas holiday-themed AR filters or lenses, which can be used with third-party video conferencing instruments like
Zoom
ZM
, Hangouts, Twitch and Skype among others.
The overall method is the same irrespective of the video calling service. Users are required to change the video source setting to Snap Camera. The lenses downloaded and selected will then appear in the video conferencing app or service.
Additionally, users can club the Snap Camera filters with Zoom’s own virtual backgrounds and filters. To do this, they will have to click on the arrow next to the video On/Off toggle in Zoom and select virtual background/video filter while keeping Snap Camera as the video input.
Moreover, Snap has rolled out a variety of Bitmoji-powered holiday sweaters and New Year’s Eve styles with built-in virtual masks installed in the Snapchat app.
Such features are expected to boost user growth for Snap’s AR lenses in the festive season. Markedly, Snap’s shares have jumped 216.9% year to date, outperforming the Zacks
Internet – Software
industry’s rally of 117.6%.
Year-to-Date Performance
Snap’s AR-based Ecosystem Aids Prospects
Snap’s AR ecosystem includes lenses, games, and experiences while it also continues to sell Spectacles AR glasses. The company’s Lens Studio 2.0 introduced Landmarkers, a new tool for overlaying AR on the world. As of the end of third-quarter 2020, over 1.5 million Lenses were created by the Snapchat community through Lens Studio.
This Zacks Rank #3 (Hold) company also introduced Lens Web Builder, a web-based, AR Lens production tool, which enables advertisers to create AR Lenses easily and instantly. You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
Per an IDC report,
global spending on AR/VR
is expected to grow from over $12 billion in 2020 to $72.8 billion in 2024. Moreover, global spending on AR/VR products and services is expected to witness a CAGR of 54% for the 2020-2024 time-frame.
Other tech giants including
Facebook
FB
, Microsoft and
Apple
AAPL
are making every effort to rapidly penetrate into the growing AR market. Facebook is working on an all-day AR wearable as its long-term vision expected for release between 2023 and 2025.
Meanwhile, Apple is reportedly planning to release a combined AR/VR headset by 2021 or 2022, followed by a pair of AR glasses in 2022 or 2023. Microsoft is also gaining steam in the market with its expanding portfolio of AR glasses, which comprise HoloLens and HoloLens 2.
Nonetheless, solid adoption of products like Scan and AR Bar is driving the usage of AR-based lenses, providing significant growth opportunities to Snap. Scan uses visual search technology, allowing users to digitally interact with anything they see through their phone camera such as to identify dog breeds and plants, or to point their phone at something and find the word for it in a local language.
Additionally, launch of Local Lenses, which enable shared and persistent AR experiences in much larger areas around the world, is expected to aid user engagement.
Moreover, launch of music Lenses in Lens Explorer and Dynamic Lenses, which allow developers to bring real-time information from their app into Snapchat Lenses, is a key catalyst.
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