The comments came after Snap's first report as a public company fell short of expectations on users and revenue.
For the quarter ended March 31, 2017, Snap reported revenue of $149.6 million, up from $38.8 million in during the first quarter of 2016. Snapchat reported 166 million daily active users in the last quarter. Net loss rose from $104.6 million to $2.2 billion, which is thought to have been because of costs associated with the March IPO.
To compensate for the lacklustre user growth, Snap pointed out that more than 3 billion daily snaps were created in order to underscore how actively engaged its user base is. In short, this is a big problem for Snapchat as it was not being expected by the investors. The company is expected to post a loss for the quarter, and has seen its share values decline from their post-IPO peak, although they're still trading higher than the $17-per-share price of the initial public offering.
Other revenue doubled to US$8.3 million compared to the same quarter a year before, but many reports are suggesting sales of Spectacles were relatively soft, compared with the hype around them. And while its user numbers are increasing, that growth has slowed amid competition from Facebook and Instagram, which Facebook owns.
Growth in Snapchat's user base began to slow down past year after Facebook's Instagram copied Snapchat's Stories feature, which lets users post short video clips that disappear after 24 hours. That slowdown coincided with Facebook-owned Instagram launching a Snapchat copycat feature.
Snap's shares were $22.98 when the markets closed on Wednesday. The firm found that 35 percent of Snapchat users do not use Facebook on a daily basis.
The slowing rate of growth is not surprising for the USA market, given Snapchat's huge popularity among its core group of young users. eMarketer estimates that 84.4% of 12- to 17-year-olds, and 78.6% of 18- to 24-year-olds, use the app at least once per month. Kerr said in an interview earlier this year. Facebook has launched several clones of Snapchat Stories, including Messenger Day, WhatsApp Status, and Facebook Stories.
At the end of the day, just because Yahoo, for example, has a search box, it doesn't mean they're Google If you want to be a creative company, you gotta get comfortable with, and basically enjoy the fact that people are going to copy your products if you make great stuff. Meanwhile, Facebook itself boasts more than 1.9 billion monthly users.