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Snap shares dive as loss widens

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Shares of Snapchat parent Snap plunged on Tuesday after reporting a widening loss and user numbers which fell short of market expectations.

[SAN FRANCISCO] Shares of Snapchat parent Snap plunged on Tuesday after reporting a widening loss and user numbers which fell short of market expectations.

Revenue at the California-based company rose to US$207.9 million but its loss more than tripled to US$443 million in the quarter that ended September 30, according to an earnings release.

Snap reported a loss of US$124 million in the same quarter last year.

Snap shares were down more than 16 per cent to US$12.58 in after-market trades that followed release of the earnings figures.

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The number of people using Snapchat daily rose to 178 million in a 17 per cent increase from the same quarter last year, according to the company.

Snapchat became popular among young smartphone users for its disappearing messages, often photos or video but analysts say it needs to show strong growth to keep pace in the rapidly evolving social media sector dominated by Facebook.

Although Snapchat is best known for its smartphone messaging, it has also developed partnerships with numerous media outlets eager to reach its audience with news, video and other content.

NBCUniversal and Snap Inc last month announced a joint venture to produce original scripted shows for Snapchat.

AFP

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