Snapchat’s Revenue Soars 44 Percent Despite Losing Users After App Redesign

Snap will report quarterly results today Facebook and Twitter’s debacles cast a shadow

The Los Angeles-area company beat Wall Street's expectations for both revenue and losses, and its share price surged by more than 13% on the news in after-hours trading to almost $15, before briefly stabilizing around $14 - an overall gain of about 6%.

Snap said ending leases in Venice, California, to consolidate offices a few miles north in Santa Monica cost it $3.9 million in the second quarter and would result in total expenses of $25 million to $45 million in 2018, mostly in the current quarter.

The earnings report didn't have any specific sales figures for its latest Spectacles hardware, though it did report $2 million in non-advertising revenue.

Snapchat has been trying to please its users ever since its first redesign in November in an attempt to simplify and streamline the user experience. Keep in mind the Snap-owned app has had trouble with growth since earlier this year, when it launched a now-controversial redesign that was met with a wave of complaints by users.

The Venice, California-based company said it had a loss of 27 cents per share. Analysts had expected Snap's user count to stay roughly the same in the second quarter after it rose by about 2% in the first quarter.

However, there was positive news elsewhere in the results as parent company Snap Inc reported revenue of 262.2 million dollars (£202.6m), up 44% on this time a year ago and above analyst expectations.

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Snap, which has never had a profitable quarter, went public in March 2017 with a $17 (roughly Rs. 1,200) share price.

"It's always going to be a niche platform, so the modest change isn't very remarkable", said Pivotal Research's Brian Wieser.

The prince built up his stake gradually, completing it in May when Snap's stock was near its low ebb.

Analysts had expected net losses of $0.17 per share in revenue of $251.19 million.

Ahead of the release of the results on Tuesday, the self-described camera company warned year-over-year growth had slowed down "significantly" from the first quarter's 54%.

Snapchat's revenue climbed 44% year over year even as it lost users in the last quarter because of a rocky app redesign and increased competition from rivals.

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