Snap CEO Evan Spiegel Is $1b Less Rich After Earnings Report

It has been a crazy time for the most used photo filter app as yet again their growth estimates for the year drops drastically, with lots of speculation about the competition from Facebook which is putting a huge gap and feeding fear on the social media company’s potential just months after its initial public offering.

The company based in Los Angeles reported that daily active users estimated to be 173 million in the second quarter, compared to the 166 million in the period prior. Analysts polled by Bloomberg had expected at least 175 million users on average. Their revenue also depreciated and the shares tumbled as much as 18% in late trading.

Thereafter its public debut in March, the maker of Snapchat mobile application for sending disappearing photos and videos predicted that it would become more popular as the company adds new interesting innovation and tools. In the second quarter, amongst their “new innovative idea” was the feature that allowed for map functions to enable users see where their friends are, as well as search section. Yet, their known rival Facebook has been successfully copying some of Snap’s key features on its larger recognised social media properties, thereby drawing away users that might have otherwise downloaded Snapchat.

The mobile advertising market is one being dominated also by Facebook app. Snap reports that quarterly revenue was $181.7million’ missing the $185.8 million average estimate of analysts surveyed by Bloomberg. Meanwhile snap has been pulling its resources and updating its offerings to give advertisers ore sophisticated options, the company has been struggling painstakingly to ensure it can secure its position in a market dominated by Facebook and alphabet Google inc.

James Cakmak an analyst at Monness, Crespi Hardt & co on a note to investors said  “This was a make or break quarter for Snap, Snap has tremendous potential if it can capitalise on the opportunity in front of it as an alternative platform for advertisers” at the moment the company is under a lot of pressure from multiple fronts.

The shares of the company went as low as $11.31 in the extended trading following its earnings release, the stock has reduced to 19% since March of 2017 at $17 a share which eventually closed at $13.77 in New York this Thursday.

According to the call made to investors the CEO of snap Evan Spiegel chat urges the investors to think of Snapchat different from Facebook and also in a statement said “We’ve always been last to market competing against giant companies, and we’ve historically been able to grow our business in markets that are highly competitive and saturated by our competitors because we’re so focused on innovation,” and he added that try will do all they can to boost the growth of company.