Published: Wed, May 02, 2018
Money | By Wilma Wheeler

Snap Stock Is Tanking After Snapchat Redesign Fails

Snap Stock Is Tanking After Snapchat Redesign Fails

Wall Street was unimpressed, and Snap's stock price plummeted in after-hours trading.

During the quarter, the "camera company" took in revenue of almost $231 million, which represented an increase of about 54%, year-over-year, while daily active users (DAUs) increased about 15% to 191 million.

The number of daily active users rose to 191m from 166m in the same quarter of previous year, falling short of consensus expectations of 194.15m, according to Reuters.

Snap Inc (NYSE:SNAP) had a quarter to forget according to its latest report, which revealed that earnings met expectations, but revenue fell below analysts' projections.

User growth at the company's disappearing-message app have repeatedly fallen short of Wall Street's expectations since its heavily hyped IPO in March past year. It was the company's slowest rate of user growth.

"As we have mentioned on our past two earnings calls, a change this big to existing behavior comes with some disruption", Spiegel told investors on Tuesday.

Earlier this year, Snapchat redesigned its app to separate content posted by friends from content posted by publishers and celebrities. And after months of standing by the changes, the company last month was forced to backtrack, promising to redesign the redesign. At the time, Citi analysts also said the redesign was not popular with many of Snapchat's users or with influencers.

"We are now focused on optimizing the redesign based on our ongoing experimentation and learning", he said. Chrissy Teigen, a model and TV personality, said she stopped using the service in March.

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