As expected, Snap took another hit on Wall Street after its Q1 2018 earnings report was published. The company again failed to turn a profit as revenue struggles to grow and outnumber expenses. Snap announced that, despite growing its user base worldwide, the money made off of each individual user fell from the last quarter.
The net loss for Snap came in at $386 million. Snap improved revenue to $231 million (up 54% year-over-year), but the company spent nearly $620 million to get there.
These are the highlights, which are more like lowlights to be totally honest:
None of the figures come as a surprise. Since going public, Snap’s struggled to prove that it can be profitable in the short-term and long-term. The company’s been listed on the stock market since March 2017, and there’s been no momentum showing a turnaround is in progress.
The number of daily active users increased to 191 million; however, Snap made just $1.21 off each one compared to $1.53 at the end of last year. The redesign is likely to have caused the massive drop. With chats and stories in a single place on the left side of the camera, there’s little reason for users to venture to the right and see what publishers and advertisers have created.
Without even getting into the financials, you can see why it was a tough start to the year for Snap. The company rolled out a major update for Snapchat that was widely panned. That, in turn, made many users avoid using the app as much.
Evan Spiegel, the company’s founder and chief executive officer, shared with investors and the media that he’s changed his mind about tweaking the app due to pushback. Snap will make adjustments that relocate stories from friends back with those from publishers and advertisers.
Snap did not mention the Spectacles, its pair of smart glasses revamped for the summer. Upon the earnings report coming out, the company’s stock price nosedived by more than 15% to $11.98 per share.