Snapchat heads for revenue decline - share falls
The photo app Snapchat continued to gain new users - but the advertising business did not get off the ground. Internally, the developer Snap is expecting a drop in revenue of between two and ten percent for the current quarter.
Snap also slipped deep into the red recently. The bottom line was a loss of around 288.5 million dollars in the past quarter after a profit of 22.5 million dollars a year earlier. Revenue remained at $1.3 billion, Snap reported after the U.S. stock market closed on Tuesday. The stock fell about 14 percent in after-hours trading. Snapchat users rose to 375 million from 363 million three months earlier.
Founder and chief executive Evan Spiegel pointed to the weakening economy, which is putting the brakes on the online advertising market. Snapchat also continues to be troubled by Apple's measures for more privacy on the iPhone. App developers like Snap must ask users for permission if they want to track their activity across different apps and websites to personalize ads. Many users refuse this, which has made ad platforms less efficient on Snapchat and Facebook, among others. (SDA)
