Snapchat loses users but gains big investment

Snapchat revamps its Spectacles

Snapchat revamps its Spectacles

Saudi investor Prince Al-Waleed bin Talal, whose investing firm owns stakes in Twitter and the Four Seasons hotel chain, said in a tweet that he'd purchased about $250 million worth of the company's shares.

Shares of Snap initially dropped, then jumped as high as $14.90 in extended trading following the report, after climbing less than 1 percent to $13.12 in NY.

However, there was positive news elsewhere in the results as parent company Snap Inc reported revenue of 262.2 million dollars (£202.6m), up 44% on this time previous year and above analyst expectations.

Snap disclosed Tuesday that the app lost 3 million of its daily active users due in large part to its controversial redesign.

Shares of Snap bounced between gains and declines in extended trading following the report, after climbing less than 1 per cent to US$13.12 in NY.

Snapchat ended the quarter with an average of 188 million daily active users, compared to 191 million at the end of Q1.

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Analysts had expected net losses of $0.17 per share in revenue of $251.19 million. That's a 44 percent year-over-year increase and an 11.9 percent increase from last quarter. That has come at the cost of the premium feel Snap had tried to ascribe to its ads, but given overall sales a jolt by attracting more advertisers.

Evan Spiegel, Snap's CEO, blamed much of the poor results on an unpopular redesign that was released six months ago that was so unpopular social media influences like Kylie Jenner openly expressed their disappointment.

The prince had previously been rumoured to be interested in investing in Snap prior to its IPO, though in 2015 a source told Reuters there were "no plans to invest".

For the current quarter ending in October, Snap said it expects revenue in the range of $265 million to $290 million. Snap in first-quarter results said it would again adjust how it presents content. "We saw and continue to see Snap as a niche platform".

The company held its first annual shareholder meeting last week via a webcast that lasted three minutes, an unusual affair because its publicly traded shares do not carry voting power. Chief Executive Evan Spiegel said in prepared remarks that the redesign was the primary reason for usage slipping, but he credited the changes for increasing viewership of key ad-supported content this year.

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