Snapchat enjoys far more new users than expected
The provider of the communication app Snapchat is gaining a foothold in the competition with Facebook, attracting an astonishing number of new users and recording a turnover of 285.7 million dollars.
The number of daily active users increased by nine to 187 million in the past quarter. This was announced by Snap on Tuesday after the US stock exchange closed. This is more than analysts had thought possible. This positive development was also reflected in the business figures: Turnover shot up by 72 percent to 285.7 million dollars. These figures were well received on the stock market. The share price rose by almost 30 percent in after-hours trading and was back above the issue price of 17 dollars for the first time since July.
Double loss
The loss doubled to 350 million dollars. However, the loss per share and excluding special items was lower than analysts had predicted. The figures show that the company is succeeding in getting the costs for new users and the service under control, said Michael Pachter from Wedbush Securities. This paves the way to generate profits. "There's still a long way to go, but this was a good first step."
Snapchat is mainly used by people under the age of 30 who appreciate the fact that their messages are deleted quickly. Facebook is now trying to offer users something similar with Stories functions. Snap earns money primarily from advertising and competes directly not only with Facebook, but also with Google . (sda reu dpa ank)
