Snapchat's new design is driving users away in bunches

Snapchat Parent Snap Posts Its First Loss in Daily Active Users

Snapchat Parent Snap Posts Its First Loss in Daily Active Users

Second-quarter daily average users fell 2 per cent from the previous period to 188 million, missing the average analyst estimate of 193 million. Its share price surged by more than 11% in after-hours trading, partly on news of a $250m (£193m) investment from Saudi prince Alwaleed bin Talal, but ultimately closed down 2% at $12.90.

Snap narrowed adjusted losses to 14 cents per share on a 44% hike in revenue to $262.3 million.

Snapchat founder and Snap CEO Evan Spiegel blamed the decline in users on the redesign of Snapchat earlier this year.

Kelley has a $13 price target and a neutral rating for shares of Snap. Overall, the company posted a loss of $353m, or 27 cents a share, compared with a loss of 36 cents a share a year ago.

The social network has reported that for the first time it has started losing users who log in once a day. The company for the first time offered a forecast for future revenue, indicating that it has a clearer understanding of its business potential, even after shifting strategies, cutting staff and cycling through managers. "It has been approximately six months since we broadly rolled out the redesign of our application, and we have been working hard to iterate and improve Snapchat based on the feedback from the community", he said.

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Snap shares have dropped 10 percent since the beginning of the year.

Snapchat was forced to redesign the new look, but not before it started to experience a decline in users at the end of the first quarter, which continued into the latest quarter.

Snap lost about 1 million users in each of its three geographic reporting regions: North America, Europe and rest of world. It will be interesting to see if this trend of desiring privacy in the modern era will continue, or if Facebook and Twitter are just waiting to pounce.

Since then, the company has also launched a second-generation pair of its Spectacles, camera-enabled sunglasses that can upload content directly to Snapchat, in an attempt to diversify beyond software.

The platform has been under pressure from Facebook's line-up of apps, which have aggressively competed with Snapchat for millennial social media users in recent years.

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