Snapchat Publishes Its Latest Performance Update Featuring Great User Growth But Concerns In Revenue

The latest performance update (i.e.: Q1 2023) for Snapchat is out and it’s showcasing some good user growth. But it’s not a completely positive picture as there are great concerns related to revenue.

For starters, the company managed to include 8 million more total daily active users during Q1 and that took the figure to 383 million users using the app regularly.

While the growth was mostly flat across the US, the EU had a more positive figure. But the company is definitely gaining a lot of momentum in regions located elsewhere, including Indians being very open to accepting the app. This might be linked to the fact that people’s reach and connectivity are rising in this part of the world, alongside other markets that continue to pick up the pace.

Snap is definitely making its mark and by going full throttle on its respective footprint, it is showcasing a bigger footprint, and that gives rise to more positive prospects in the future. But as far as revenue is concerned, it’s not doing too great.

The figures put out by the company showcased $989 million as a whole for this quarter and that is a huge decline.

The company mentioned in its statement to the public how the revenue figure for Q1 was a challenging front as they tried to set out more changes to the advertising platform that was very disruptive in terms of users’ demands. While the current environment shows some signs regarding stabilization, it does showcase growth along the way too.

The firm’s brand-oriented performance went down by 12% YoY and its DR business also declined by 9%. So the company is certainly seeing some sort of a better performance in terms of advertising and that’s linked to systematic improvements. But for now, the figures are not looking too good.

It’s not great, especially when it comes down to huge variances in income in the US and various other markets. Let’s not forget how the firm’s system expenses are also increasing which it tried to overcome with the firing of its workforce.

Still, the costs linked to the infrastructure are still on the rise and the company is busy trying hard to develop AR tools with the thought related to having a lead in this space.

This is a key focal point that Snapchat takes into consideration and manages well as it makes ways for better means to rationalize the business aspect.

As far as usage trends are concerned, this app mentioned how Spotlight which is the platform’s short video platform feed, continues to achieve growth. Today, it stands at a whopping 350 million monthly active users that continue to engage with this sort of content that’s similar to TikTok. It’s nearly up by 46% when compared to previous YoY figures.

The growth related to short-form videos is huge and it’s a part of the bigger shift that is far away from some social elements and leading toward entertainment. This means seeing users spend way more time on such platforms but similarly, showcase fewer interactions and tap on posts at a slower pace.

As far as marketing is concerned, this happens to be a key trend as it hints at the significance of making content that has a great focus on entertainment and doesn’t drive referral traffic too much. And that’s not hugely beneficial as it increases brand awareness big time.

Meanwhile, another thought must be provided to the Snapchat+ subscription which is the company’s other main source of making money. Today, it stands at 3 million subscribers who are paying to use the feature.

Read next: Pinterest Publishes Its Latest Performance Update For Q1 Of 2023 With Increased Users But Slow Revenue Intake
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