Snap revenue up, but so are losses

The social media company added to its daily active user count in the second quarter.
snapchat social video

Snap posted higher revenue and added daily active users in its second quarter financial report, but net losses continue to climb at the social media company.

Snap’s global revenue for Q2 2017 was $181.6 million, up from $71.7 million for the same period last year. In North America, revenue for the quarter was $148 million, up from $65 million compared with same period last year and the $129 million it reported in Q1 2017.

The company posted an quarterly net loss of $443 million.

Snap has been under increased pressure since going public as Facebook-owned Instagram continues to add features that mimic Snapchat’s offerings.

In May, Snap began to test new self-serve advertising options that gave advertisers direct access to its inventory (a service previously accessed through approved third-party vendors). It was designed to expand its potential base of advertisers, which New York-based Pivotal Research Group said was “apparently successful.” However, Pivotal believes Snap’s stock in still due to drop (at press time Snap Inc was trading on the NYSE at just over US$12, but Pivotal estimates a US$9 price).

Globally, average revenue per user was up 109% in Q2 of 2017, rising to $1.05 from $0.50 in Q2 2016. That rate also went up compared with the first quarter of the year, when it was $0.90. In North America, average revenue per user moved up to $1.97 in Q2, rising from $1.06 in Q2 2016 and $1.81 in Q1 2017. Snap’s co-founder and CEO admitted the numbers still have a ways to go on the Q2 conference call, saying the company is “still in the very early days [of advertising].”

In terms of people actually using the app, Snap reports daily active users grew to 173 million in Q2 2017, up from 143 million for the same period in 2016, for a jump of 21%.

The addition of seven million users for the quarter – approximately four million of those from Canada and the U.S. – is slower growth than the numbers the company saw in Q1 when it added eight million.

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