Snapchat ad revenue grows slower than expected
According to market researchers, the messaging service Snapchat is expected to see lower-than-expected advertising revenue this year. Revenue is likely to total just $770 million, Axel Springer subsidiary eMarketer announced on Tuesday.
Compared with 2016, this would still be an increase of 157 percent. However, experts had assumed more than 800 million in September. The reason for the decline is that Snapchat has to share more revenue with partner companies.
Shares in Snapchat parent Snap fell 1.5 percent in midday trading in New York, significantly outperforming the overall market. The company had celebrated its stock market debut on March 02 with a price jump of 44 percent compared to the issue price of 17 dollars per share. In the meantime, the shares are worth just over 20 dollars.
Snapchat is competing with companies like Facebook and Google for billions of dollars in advertising from customers. According to eMarketer, the total digital advertising business is expected to increase by 16 percent to $83 billion this year.
According to the report, Facebook's share will rise to almost 20 percent, while Google still has just under 41 percent. For the short message service Twitter, eMarketer predicts a decline in advertising revenues of 4.7 percent to $1.3 billion. That would bring its market share down to 1.6 percent from the previous 1.9 percent. (SDA)
