Are the wheels well and truly coming off the Snapchat bandwagon?
Parent company Snap, Inc published its latest quarterly financial results last night, and while its revenues grew by 62% year-on-year to $207.9m, the company’s net loss ballooned to $443.2m compared to $124.2m this time last year.
Snapchat’s user growth is also still slower than investors had hoped: it now has 178 million daily active users, just 4.5 million more than the previous quarter. Snapchat’s ad rates dropped by 60%, and the company took a $40m charge on unsold Spectacles glasses to boot. Ouch.
So how is Snapchat going to bounce back? CEO Evan Spiegel said that “we are currently redesigning our application to make it easier to use” in the hope of attracting a wider audience, while also introducing a Facebook-style algorithmically-sorted feed for Snapchat stories, rather than simply presenting them in reverse-chronological order.
Spiegel also admitted that Snap has “historically neglected the creator community on Snapchat”, and that it’s planning to introduce more features to help them make money – an effort to stem the drain of ‘influencers’ from Snapchat to other platforms, particularly Instagram.