In quarter 2 of 2018, Snapchat lost 3 million active users. This drop was most likely due to their redesign of the app that launched earlier this year. However, despite the loss in active users, their revenues ended up being higher than what analysts predicted. Revenue was posted at $262 million ahead of the $250 million estimate from experts. Additionally, stock trading jumped after closing, with shares rising 11 percent in after-hours trading.
But what does this spell for the future of the social media app? User numbers are still on the decline, however there was just a $250 million investment from billionaire tech investor and Saudi Prince Alwaleed. With this money, the platform may have the potential to grow, but its up to the developers to listen to their consumer base so that they do not make the same business mistake as they did with this last update.
The reviews of the new update were so bad that users created a petition in order to get the app reverted to its original form. Sadly, it’s not uncommon for big business and companies to ignore their user base in light of development updates. When Instagram lost its chronological order, users freaked out as well. With this change, however, Snapchat’s earnings per share have dropped by $0.14. If this downward trend continues along with a loss of users, Instagram may very well steal the spotlight.
