Snapchat faces harsh reality check after earnings miss

Friday 12 May 2017 2 weeks ago 38   Washington   Print

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Report  Web desk : WASHINGTON: Snapchat s hopes to become the next big social media platform hit a brutal reality check with the first earnings report from parent company Snap Inc. The $2.2 billion loss reported for the first quarter along with weaker-than-expected revenue and sluggish user growth prompted a wave of selling and harsh comments from analysts about the firm known for its disappearing messages. Snap shares skidded 18.8 percent in morning trade Thursday to $18.66 as optimism over its prospects to challenge Facebook faded. Snap disappointed analysts with reported revenue of $149.6 million in the three months ending in March. That was up 286 percent from a year ago but below Wall Street estimates of around $158 million, and a significant miss for the fast-moving social media segment. Snap said the number of daily active users grew to 166 million at the end of the quarter, a 36 percent increase from a year ago but just five percent higher than at the end of 2016. (01)