Snap loses 3 million daily users in Q2, but beats revenue expectations

Scene inside Snap's headquarters

Snapchat parent Snap reported this afternoon that during the second quarter, the messaging app lost three million daily active users.

Snap reported 188 million daily active users during the last quarter - falling short of Wall Street's expected 192 million and dropping from last quarter's 191 million.

The Los Angeles-area company beat Wall Street's expectations for both revenue and losses, and its share price surged by more than 13% on the news in after-hours trading to almost $15, before briefly stabilizing around $14 - an overall gain of about 6%.

Snap narrowed adjusted losses to 14 cents per share on a 44% hike in revenue to $262.3 million.

Co-Founder and CEO of Snap Inc.

Shares of Snap bounced between gains and declines in extended trading following the report, after climbing less than 1 per cent to US$13.12 in NY.

New York To Cap Uber, Lyft And Other Ride-Hail Services
Ride-hailing services have an estimated 80,000 of the 120,000 available for-hire vehicle licenses in NY , the companies say. The Council also voted to set a minimum driver wage equivalent to the yellow cab wage for app-based drivers.

On Thursday, the businessman announced a $267 million deal to buy newly issued shares in the Dutch music streaming service Deezer through his Kingdom Holding investment company and Rotana Group, the entertainment company he also owns.

The company also shared metrics for monthly active users for the first time, reporting 100 million MAUs in the United States and Canada.

Snap had never before logged a quarterly drop in daily users, according to data it has released going back to 2014.

"We have been working hard to iterate and improve Snapchat based on the feedback from our community", Evan Spiegel said on a call.

Shares in Snap climbed more than 12 percent in after-hours trading before reversing course. Still, revenue topped projections as demand increased for the company's mobile advertisements. Snap said Tuesday that third-quarter revenue would be US$265 million to US$290 million. Prices fell 9 percent in the second quarter compared with the previous quarter and 52 percent from a year ago. CNN reports that this is the first time Snapchat's user count has dropped since Snap Inc went public. It will be interesting to see if this trend of desiring privacy in the modern era will continue, or if Facebook and Twitter are just waiting to pounce.

Ahead of the release of the results on Tuesday, the self-described camera company warned year-over-year growth had slowed down "significantly" from the first quarter's 54%.

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