I just triggered it in one of my attacks! It is [holiday] trap, hidden until triggered by one of your troops. It will proceed to pop open, pop red smoke, then Santa will carpet bomb the area with presents - which are bombs.
I was able to capture some screen shots below of my reply
Troops triggering the trap:
Trap popping open (didn't seem like any damage was done here):
Red smoke, followed by Santa flying above it:
Present Carpet Bomb!
Not much left (but unsure of total damage in AoE): There is no damage to attacking troops. The "trap" just drops presents with 5k elixir each. I was attacked recently and the archer that triggered it didn't die. Santa just flew by and drop 5 presents with 5k elixir a piece.
If you are on the receiving end of the attack and your Santa Strike is triggered, I found that it will leave presents for you to open near that attack. I gained 5,000 elixor per present.