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In its third quarter earnings release, Snap generated record revenue even as its numbers of daily active users slipped.
The ephemeral camera company’s revenue rose to $297.7 million, up 43 percent from its Q3 2017 revenue of $207.9 million. That beat expectations from FactSet, which predicted that Q3 revenue would come in at $283 million.
Snap reported 186 million DAUs in Q3 2018, down from 188 million in Q2 2018. The slip in DAUs comes as Snap is still facing fallout from its ill-fated redesign that it rolled out earlier this year.
In a memo to employees that leaked last month, Snap CEO Evan Spiegel acknowledged that “we rushed our redesign, solving one problem but creating many others.”
The company is still not profitable, and generated a net loss of about $325 million this quarter.
“We’re investing in long-term growth opportunities and driving operational efficiencies,” Tim Stone, Snap’s CFO, said in a press release. “We achieved record revenue and strong bottom-line results this quarter and expect a record fourth quarter, as we continue to invest in innovation for our community and scale our business.”
Snap said it expected to generate between $355 million and $380 million in revenue in Q4 2018, and expects DAUs to decline again.
On a call with investors, Spiegel stressed that the company sees growth opportunities in reaching more people outside of its core 18-to-34 year old demographic, and doing a better job in communicating Snapchat’s value proposition, which is that it is the “fastest way to visually communicate with close friends and family.”
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