- Snapchat, owned by Snap, posts 50% year-over-year growth
- COVID-19 may have boosted its revenues, due to imposed restrictions
- Snap is focusing heavily on connecting with the younger generation
- The report boosts company shares and raises market interest
The COVID-19 pandemic has been troublesome for many companies and startups and still poses a huge threat to them. But the work-from-home, social distancing, and stay-home protocols have boosted services like media streaming, video-calling, and office productivity tools, among others. The photo and video sharing app Snapchat has also witnessed a rise in its usage in 2020. Snapchat owner Snap.Inc released its latest earnings report, showing a significant rise in their daily activities.
Snap Inc.’s earnings report shows an increase in users and improvement in revenue outlook. According to it, Snapchat has tallied 249 million overall users, adding 11 million more daily activities in Q3. With their growth almost stalled in Q1-Q2 of 2019, Snapchat has gained momentum and has seen growth at a steady pace. The slump in its global users can be attributed to the rise of Instagram Stories. But the pandemic forced people to seek alternatives in entertainment apps, like Snapchat.
Snap’s decision to upgrade its Android app has paid huge dividends in terms of user growth. Snapchat has seen significant growth in India, an android-dominated market, where users are increasingly consuming its original Discover content. The total daily usage time went up by over 50% year-over-year. It has positioned Snapchat as a new media leader with its focus on connecting with younger audiences. The company’s Gen Z focussed programs like Shorts and Discover have established Snapchats as a key platform for connecting people.
Snapchat’s AR tools
Snapchat reports that the average number of daily Snaps created has seen a 25% year-over-year improvement. It’s ‘Anime’ lens visual effect was used some 3 billion times within the first week. The ‘Anime’ transforms users into Anime-styled characters, thus promoting more people to install the app. According to Snapchat, its users are spending more than 250 million minutes using the AR tools on a daily average. Snap’s innovation and its creative capacity have helped secure its place in the app market.
After the company revealed its earnings, its shares raised almost by 20% in the after-hours trading. It reached its peak after the report, with share prices bumping up from $28 to near $34. The report revealed revenue of $679 million, and it posted an adjusted $0.01 per-share profit against the expectations of a $0.04 loss. Although the company still incurred a net loss of $200 million, it is a 12% improvement over last year.
