Snapchat reports lower Q3 growth and an upcoming redesign for Android; Snap shares tumble

Snapchat reports lower Q3 growth and an upcoming redesign for Android; Snap shares tumble
When Snapchat first launched, it was known for its "Mission Impossible" style messages that would disappear seconds after being read. Eventually, the app became known for other things such as its animated filters and Stories. The company started selling Spectacles, sunglasses with built-in cameras that take videos designed to be shared on social networks. Earlier this year, Snapchat celebrated its 500 millionth download.

Yesterday, Snapchat parent Snap released Q3 earnings. For the three month period, 4.5 million new Daily Active Users were added, lower than hoped for. The company also announced that it will redesign the Android version of the Snapchat app. The new version will be first rolled out in select markets before it is pushed out to all Android users. The goal is to fix the issues that have users of the app complain that it is "too difficult to understand," and "hard to use."

Snapchat has been making small changes, such as the new updated architecture for Stories playback. This means that a complete video file doesn't have to be loaded before playback begins. Snapchat is also looking at working with carriers to provide the Snapchat community with lower cost cellular connectivity. And Stay Tuned, a twice-daily news show produced in partnership with NBC, reached 12 million 13 to 24 year-old viewers in the United States in September. That made it one of the most popular news shows for young viewers.

In addition, CEO and co-founder Evan Spiegel said that Snapchat is most likely the most used camera in the world with 3.5 billion Snaps created daily. That figure is up 40% year-over-year.

With 178 million Daily Active Users, Snapchat reaches more than 70% of  13-34 year-olds in the U.S., U.K., France, and Australia. The goals for 2018 include capturing users above 34, and signing up more Android users. It also wants to create more distribution and monetization opportunities for those who create public stories on Snapchat.

Not everything is peachy keen with Snap. The company had some problems switching from direct ad sales to the auction process used by Facebook and Google. Thus, prices for ads slid by 60% year-over-year. The company also lost $40 million on its inventory of unsold Spectacles. Combined with the slower than expected growth it reported, Snap's shares took a beating in after-hours trading yesterday. At the 4pm close of the regular trading day on Tuesday, the stock closed at $15.12; after the earnings were announced, the slower growth and announcement of an Android redesign combined to knock the stock down by over 17% to $12.53.

For the third quarter, Snap lost $443.2 million, or 36 cents a share. That compares with last year's third quarter loss of $124.2 million. Expenses rose by more than 250% year-over-year.

source: Snap

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8 Comments

1. Arch_Fiend

Posts: 3951; Member since: Oct 03, 2015

I know a lot of people who aren't tech savvy and probably found snapchat hard to use at first. I can see the benefit it making snapchat simpler to understand because I really hate it when somebody ask me something that is so obvious yet they can't figure it out, not just talking about snapchat here because I don't really use it but I do use my iPhone and so many people don't even know half the things their phones can do because it's to complicated to figure out, mainly iOS users, that or most iOS users are just stupider than Android users and I 'd like to think its the former. There is a reason PA has to post so many iOS tutorials.

2. Derekjeter

Posts: 1467; Member since: Oct 27, 2011

Too many damn messaging apps. I don’t use anything other than my regular messaging app on my iPhone or my Nexus 6P. It’s sad that all these kids are trying so hard to gain “likes” and “subscribers” by doing stupid s**t like that Boonk guy or the other dumbs ass Supreme. Nothing but dumbasess.

3. Phullofphil

Posts: 1762; Member since: Feb 10, 2009

Most of that is assumptions. I see the opposite. Or no difference. I see plenty of android users that are not tech save and only have a android because it’s cheap and it’s a smartphone. I can do pretty much any thing I want on either android or iOS and I prefer iOS. Mainly because it fits my life. But also it stays less buggy the more you use it. In my exxpierenxe. Even though right now I am expieeenxing a huge problem with some of my stuff. I still had more issues with my android phones. They were dinner to figure out but my iPhone for the most part has always just worked great.

4. Derekjeter

Posts: 1467; Member since: Oct 27, 2011

Bro!!! The Android fan boys will read that and eat you alive. I never understood why Android fans state the iPhone can’t do a lot of what Android can. I carry both and I do the same on both. If I could carry just one it would have to be iPhone just because it’s less lag, speakers sound better, and apps run a lot better and look better. My employer forced me to carry the android phone and honestly I love my Nexus 6P. Sometimes the iPhone gets slower speeds and I switch to the Nexus and vise versa. There’s really no huge difference anymore, but like I said, the games I play on iPhone look a lot better than on my Nexus.

7. Heisenberg

Posts: 373; Member since: Feb 11, 2015

Everybody knows games works well on iPhone than Android but that's not the only thing done on phones. Secondly, what iPhone do you make use of? Nexus 6P is known to have a troubled chip. Finally, you can't use an Android phone to judge others if yours lag after sometime

5. mahima

Posts: 727; Member since: Nov 20, 2014

is snapchat relevant outside USA?

8. UglyFrank

Posts: 2193; Member since: Jan 23, 2014

It's very relevant in England

6. Heisenberg

Posts: 373; Member since: Feb 11, 2015

Good for that proud guy. How can you intentionally cripple an OS app with over 93% users because of your preference for iOS. Damn it!!!

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