Snap Shares Plummet Amid Average Q1 Results

  • Snap Shares Plummet Amid Average Q1 Results

Snap Shares Plummet Amid Average Q1 Results

Late a year ago, Snapchat proudly announced a complete overhaul of the app, which as we all know was widely disliked by the majority of the users. In a sign of the user dissatisfaction, reality show star Kylie Jenner tweeted about her disappointment with the change in February, causing Snap's stock to fall sharply.

Wall Street analysts are recasting their projections and slashing their stock price targets on Snap Inc (NYSE:SNAP) a day after the Snapchat app maker posted dismal first-quarter results. And, the stock dropped a further 17% after the closing bell, when the results were released.

Snap's share price fell 22% to $10.96 (£8.05) in early trading as investors reacted to ongoing concerns over its struggle to compete with Facebook and its subsidiary Instagram.

Snap's slowdown comes as Facebook announced plans to invest more in the "stories" function that allows posting of videos and photos that disappear in 24 hours, a feature copied from Snapchat.

Snapchat's number of Daily Active Users increased only 2 per cent in the quarter, too, amid the avalanche of bad publicity over the redesign.

It was the company's lowest opening ever, according to CNBC, thanks to an unsuccessful Snapchat redesign and sharply declining ad revenues, among other factors.

Despite this, Spiegel attempted to reassure investors by claiming the redesign "created a lot of new opportunities" adding that "we look forward to continuing our efforts to refine and improve Snapchat". "This is the first full quarter that the redesign has been out in the wild", said Cheddar's Alex Heath. Story Ads have just been rolled out programmatically for the first time this week, and we've seen recently how Lenses is starting to offer the type of interactive experience that has been prophesised by technologists for years. The app will make it easier for creators and brands to manage their Snapchat content and advertise on the app.