It might be millennials' favourite social media messaging platform but Snap* is in the doghouse on Wall Street. Compared to this, the earning for the same quarter during past year were only $38.8 million.
Snap's year-over-year growth rate fell to 36 percent year-over-year from 48 percent in the fourth quarter last year, TechCrunch reported on Thursday. That's an increase of over 2,000 percent in just a year. Snapchat has 166 million.
Snap is also pushing toward direct-response dollars with features that let users watch content or buy items.
To compensate for the lacklustre user growth, Snap pointed out that more than 3 billion daily snaps were created in order to underscore how actively engaged its user base is. Snap missed analyst revenue estimates by $US10 ($14) million, bringing in $US149.6 ($203) million in revenue. The stock was down 23 percent as the call, a first for CEO Evan Spiegel, chief strategy officer Imran Khan and CFO Drew Vollero, wrapped up Wednesday afternoon.
Snapchat's co-founders have lost a combined $2 billion after a surprisingly underwhelming first quarter.
Many analysts remained sceptical of Snap's long-term prospects.
Beating so easily early on didn't help Twitter much in the long run, as its user growth problems, which were already apparent in that first report, spiraled out of control and hurt the company in the long run, eventually costing CEO Dick Costolo his job. It reported a tremendous number of 1.28 billion users for 2017's first quarter. It's essentially not a social networking application like Facebook or WhatsApp.
Both applications mimic Snapchat, allowing users to post a string of photos and videos that disappear after 24 hours.
Facebook also announced that users for Instagram stories have reached the 200 million mark. Snapchat with 166 million users approximately is nearly 34 million users behind. "ORCRP0017755-topic.html" class="local_link" >Snap Inc. says it prioritizes - the time users spend on its Snapchat app, how often they open Snapchat, messages sent and average revenue per user - the Los Angeles company experienced a rosy first quarter. Well, this is up from $0.32 during Q1 of 2016.
Many companies that just reported disappointing numbers might seek to soften the blow on their earnings calls by delivering more insight into how the numbers will improve in the future.
Shares in the Snapchat maker [NYSE:SNAP] plunged almost 24% in after-hours trading after a disappointing quarterly result. Shares are now trading approximately around $18.19.
This development isn't really a surprise since analysts have been fearing for the worst ever since Snap went public, Venture Beat reports.
Snapchat has been facing massive competition from Facebook recently with the company owned Instagram introducing Instagram stories.