In today’s earnings letter to Snap investors, CEO Evan Spiegel revealed that Snapchat is working on a significant overhaul of its app. “One thing we have heard over the years is that Snapchat is difficult to understand or hard to use, and our team has been working on responding to this feedback.”
He confirms that a redesigned, easier-to-use Snapchat is coming. And it sounds like whatever’s on the way is far bigger than just some minor user experience tweaks.
Spiegel says that “there is a strong likelihood that the redesign of our application will be disruptive to our business in the short term, and we don’t yet know how the behaviour of our community will change when they begin to use our updated application.” His full statement on the new app follows below:
One thing that we have heard over the years is that Snapchat is difficult to understand or hard to use, and our team has been working on responding to this feedback. As a result, we are currently redesigning our application to make it easier to use. There is a strong likelihood that the redesign of our application will be disruptive to our business in the short term, and we don’t yet know how the behavior of our community will change when they begin to use our updated application. We’re willing to take that risk for what we believe are substantial longterm benefits to our business.
Snap is far behind Facebook and Google in making its ad system accessible to small businesses. Snap recorded a $39.9 million charge in the quarter related to excess inventory of its “Spectacles,” sunglasses with a built-in camera.
Snap posted a net loss of $443.2 million, or 36 cents per share, compared with a loss of $124.2 million, or 15 cents per share, a year earlier. Wall Street had expected a loss of 32 cents per share, on average, according to Thomson Reuters I/B/E/S.
Snapchat, popular among millennials for the bunny faces and floral tiaras that can be added to pictures, allows users to chat through a series of disappearing photos and videos. Users can also post images and videos as “stories” - ephemeral posts that can be viewed in chronological order and disappear after 24 hours.
Before the quarterly release, Snap’s share price was already down 39 percent from its close on March 2, its first day of trading on the New York Stock Exchange. Facebook’s shares were up 32 percent over that time.
Facebook’s Instagram said in September that it had 500 million daily active users.
