Snapchat losses widen as user growth slows

Snapchat has seen its shares tumble after the social network reported disappointing growth in the first three months of the year.

Snap Inc, the owner of Snapchat, saw a n djusted loss of $188.2m, which was about $10m worse than analysts had expected, while the net loss soared to $2.2bn from $104.6m due to costs associated with the IPO earlier this year.

Revenue rose 286% for the quarter to almost $150m, but was also short of forecasts by about $9m.

In its first results since floating, Snap said the number of daily active users rose just 5% to 166 million compared with the last three months of 2016.

That was two million fewer than expected, but 36% higher than the same period last year.
The news sent shares tumbling more than 20% in after-hours trading in New York.

Year-on-year growth in users was 36%, slowing from 48% in the fourth quarter and 63% in the third quarter.

Revenues were up nearly four-fold compared to the same period last year at $149.6m but lower than the $158m expected on average by analysts.

Measured per user, revenues were three times higher than in the same quarter last year but 14% lower compared to the previous three months.

The disappearing messaging app, popular with teenagers, attracted huge interest when it went public in New York earlier this year – sending its shares 44% higher in its first day of trading.
But Facebook – which once offered $3bn to buy the business – has upped the ante by offering features similar to Snapchat on its platforms including Instagram and WhatsApp.