Snap boosts revenue and users with new “augmented reality” features
Snapchat parent company Snap boosted its user numbers and revenue in the second quarter of the year as customers lapped up its “augmented reality” filters, although it is yet to turn a profit.
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Revenue at the US social media firm rocketed by 48 per cent in the second quarter compared to a year earlier to reach $388m (£311m). Snap’s shares rose 11 per cent in after-hours trading to reach $16.50.
The number of daily active users rose to 203m in three months to 30 June, Snap’s financial results showed today, from 190m in the previous quarter.
The strong results came after a tough 2018 when a botched redesign caused users to flee Snapchat and a number of executives left the company. Competition also grew asInstagram launched its own disappearing “stories” and messages.
Snap only returned to growth in the first quarter of this year after redoubling efforts to bring users back on board and to attract younger people.
The Snapchat owner’s share price slumped to an all-time low of below $5 in 2018, but has rebounded. It is yet to climb above its issue price of $17 in March 2017, however.
It said today improvements in the design of its Android app had been a factor in users sending seven per cent more “snaps” – disappearing images and videos – to one another compared to the old version.
A new raft of “augmented reality” lenses that, for instance, let people appear as different genders or even cats in their messages had brought users back to the app, Snap said.
“Over 200 million Snapchatters played with these new Lenses in the first two weeks,” the Los Angeles-based firm said.
Yet Snap has still not made a profit, despite trimming its losses by 15 per cent to $255m in the second quarter year on year.
“The growth in our community, engagement, and revenue is the result of several transitions we completed over the past 18 months,” said chief executive Evan Spiegel.
“We look forward to building on our momentum and making significant ongoing progress in each of these areas.”
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Snap said it expected revenue in the third quarter to be between $410m and $435m, compared to $298m in the third quarter of 2018.