Snapchat (SNAP) dropped more than 20% in after hours trading after its initial quarterly earnings report since going public on March 2. The disappointing earnings report, which showed slowing daily user growth, caused SNAP to return to close to its $17 IPO price. SNAP opened trading at $24 on March 2 and briefly dipped below $20 but had not challenged its IPO price until the report (see chart).
Snap reportedly added eight million new daily users in the first three months of the year, a year-on-year growth of 36%. However, a year ago those daily user growth was 52%.
Business Insider reported the following earnings metrics from SNAP’s Q1 earnings:
- EPS (adjusted): Net loss of $0.20 vs. $0.16.
- Revenue: $149.6 million vs. $159 million expected, up 286% from $39 million in the year-ago period.
- Daily active users: 166 million, an increase of 36% from 122 million in the year-ago period.
- Net loss: $2.2 billion.