Snap Inc. surprised the market with its fourth-quarter results Tuesday as the Snapchat app maker reported renewed growth in user numbers and revenue.

Revenue for the quarter ended Dec. 31 jumped 72 percent, to $285.7 million, from a year earlier, roughly $30 million above what analysts had predicted. Average daily users for Snapchat also rose from a dismal third quarter to 187 million, up 8.9 million.

The market liked those numbers. Shares in the company, which went public in March 2017, surged more than 21 percent in after-hours trading, to $17.07 a share, their highest level since last June. And on Wednesday morning, they’re trading up 49 percent, to almost $21 a share.

The rise in user numbers is being attributed in part to a redesign of the Snapchat app that started rolling out in November. Yuval Ben-Itzak, chief executive of social media marketing platform Socialbakers, told SiliconANGLE that the redesign was “a step in the right direction, offering marketers increased personalization and relevance.”

The ad revenue growth in turn was helped by a new automated auction platform. “The auction and the recently introduced self-service ad platform helped drive growth in SMB advertisers, which are a growing source of demand for the rising ad load,” Cowen & Co. analyst John Blackledge wrote in a note to clients. “For the first time, >50 percent of ad revenue was generated outside of Ad Age 100 advertisers, which signals SNAP’s ad biz is transitioning to a broader set of advertisers.”

But Ben-Itzak said more needed to be done, in particular making sure the company maintains the quality and relevance of its content, especially as it aims to catch up to Facebook Inc.’s juggernaut Instagram. “A drop in quality takes users’ attention elsewhere and Snapchat is currently facing that challenge,” Ben-Itzak said. “If the redesign delivers on its promise to serve quality content in a targeted way, it could prove to be just what Snapchat needs to increase eyeball time on the app. It could also be a great opportunity for marketers to reach and engage their audiences with well-targeted promoted content, while positively impacting Snapchat’s bottom line.”

The numbers weren’t all good. The company booked a net loss of $350 million for the quarter.

Brian Wieser, senior research analyst for advertising at Pivotal Research Group, took a similarly mixed view in a note to clients late Tuesday. “We see the advertiser expansion as an important source of revenue diversification and reflects Snap’s capacity to grow revenue through a broadening of its addressable market,” Wieser said. “On the other hand, we can infer this result at least partially reflects some degree of deceleration in spending from large brands, which generally view Snap as a niche platform rather than something core to their typical campaigns.”

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