Snap's shares fizzle out as its user growth falters

Snap's shares fizzle out as its user growth falters

As easy as it is to sound the death knell, put on a crying lens and declare that it's the end for Snap and Snapchat, this could easily just be growing pains for the company after rushing its IPO. (SNAP) has revolved around the impact of Facebook's clones - Instagram Stories especially - on Snapchat's user growth.

The company did not hit Wall Street's benchmarks, sending the stock down as much as 10 percent during afterhours trading on the NYSE. As has been said repeatedly here and elsewhere, Facebook was a disaster for its first 18 months as a public company.

During the second quarter, Snap announced&nb sp;a two-year content-development deal with Time Warner. Some potential stock buyers have expressed concern that Snap is losing users and advertisers to Instagram, that has acknowledged copying features from Snapchat. The business had revenue of $181.70 million during the quarter, compared to the consensus estimate of $186.49 million. While Snap has been updating its offerings to give advertisers more sophisticated options, the company has been struggling to prove it can secure its position in a market dominated by Facebook and Alphabet's Google Inc.

Johnston added that 2018 is the "make or break year for Snapchat".

The slump in after-hours trading on Thursday night took Snap's stock down to $12, half the value they had reached shortly after the company's float in March this year which had valued it at an initial $24bn.

That didn't stop CEO Evan Spiegel from boasting to investors about the weenie's pioneering achievements. The firm's market cap is $16.23 billion.




If that's the case, it's time for Spiegel to rethink things.

Like other social media companies that have gone public, some of the main focuses among analysts have been on SNAP's user growth, average revenue per user (ARPU) and the company's path to profitability.

"We'd have to add more than 10 million daily active users in the rest of world for every 1 million daily active users in the USA and Canada in order to make the same amount of money", Spiegel said.

However, net loss widened to $443.1m, or 36 cents per share, from $115.9m, or 14 cents per share. "Snap is one of six platforms with over 150 daily active users outside of China". While any rise is good, the 173 million total users still doesn't surpassed the 250 million daily active users on Instagram Stories, which celebrated its first birthday last Wednesday. Finally, Oppenheimer Holdings, Inc. raised shares of Snap from a "market perform" rating to an "outperform" rating and set a $23.00 price target for the company in a report on Thursday, May 11th. Investors have been anxious about the volatility of the stock, with a post-IPO ban on employees selling shares expiring on Monday.

Several other institutional investors also recently bought and sold shares of SNAP.

Related Articles

  • Russian surveillance jet flies over White House, US Capitol and Pentagon

    Russian surveillance jet flies over White House, US Capitol and Pentagon

    Politico and Fox News also said the jet went past Bedminster, New Jersey, where President Donald Trump is vacationing. According to the treaty guidelines, USA airmen are aboard the Russian jet observing when an Open Skies flight occurs.
    Stephen Colbert on Trump's North Korea threats: 'We're all going to die'

    Stephen Colbert on Trump's North Korea threats: 'We're all going to die'

    Scaramucci was replaced nearly immediately by former Homeland Security Secretary John Kelly. The other guest on next Monday's " Late Show " is the actor Bob Odenkirk .
    I continue to stand for the 'Gathbandhan': Sharad Yadav

    I continue to stand for the 'Gathbandhan': Sharad Yadav

    On Thursday, Sharad told reporters that he would undertake a yatra (journey) across the state to speak to the voters. According to Sharad Yadav's loyalists, several party MLAs and MLCs are in touch with him.
  • Tesla self-driving truck set for road testing

    Tesla self-driving truck set for road testing

    Long-haul trucks do not face cross traffic when they travel on limited-access highways, and they largely operate at steady speeds. Several other Silicon Valley companies are developing autonomous driving technology and are working on long-haul trucks.
    Officer's camera catches attempted murder in SC

    Officer's camera catches attempted murder in SC

    In the moments after the gunfire, the officer could be heard telling emergency dispatchers: "Tell my family I love them". James Dunne, an emergency room physician, testified that a bullet completely severed a vein in Smith's neck.
    FBI Raids Paul Manafort's Home in Russia Probe

    FBI Raids Paul Manafort's Home in Russia Probe

    Along with the raid on Manafort's home, Mueller is now using a federal grand jury in Washington to further the investigation. The documents included materials Manafort had already provided to Congress, said people familiar with the search.
  • Mitchell Trubisky tracker: Mentor native efficient in preseason debut

    Mitchell Trubisky tracker: Mentor native efficient in preseason debut

    Do Chicago sports fans care? "Our depth chart is not going to change after one game, particularly a preseason game", Fox said. Trubisky also marched the Bears to the Broncos' 22-yard line on the game's last drive, but his final pass fell incomplete.
    North Korea frees imprisoned Canadian pastor

    North Korea frees imprisoned Canadian pastor

    Trudeau's spokesman Cameron Ahmad said the government considered Lim's health of "utmost importance" but did not give more details about the delegation.
    Netanyahu slams media campaign to 'overthrow' him

    Netanyahu slams media campaign to 'overthrow' him

    Netanyahu's lawyer said in a statement that the "aggressive" suit sought to silence the prime minister's son. He added: " It's not like I am going tomorrow and they are going to replace me ".
  • Glen Campbell dead at 81

    Glen Campbell dead at 81

    As Love explains in his Facebook post , Campbell toured with The Beach Boys in 1964 as a replacement for Brian Wilson . After having accompanied Frank Sinatra , Elvis Presley or the Beach Boys , the guitarist prodigy went solo in 1963.
    United States  embassy workers in Cuba hit with 'acoustic attack'

    United States embassy workers in Cuba hit with 'acoustic attack'

    Cuba's Ministry of Foreign Affairs issued a statement Wednesday night, saying it was informed of the alleged incidents by the U.S. The embassy, however, will remain open, "in the hope that our countries can forge a much stronger and better path", he added.
    Mother in shock after teenage babysitters put infant in refrigerator

    Mother in shock after teenage babysitters put infant in refrigerator

    The mother says her niece is no longer allowed to babysit or be around her daughter. The Department of Children and Families is investigating.