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Snap Tackles Revenue Slump with Subscriptions, Hardware
5 Feb
Summary
- Snap's Q4 revenue grew 10% year-over-year to $1.7 billion.
- Paid subscribers for Snap+ reached 24 million, a 71% increase.
- Daily active users slightly declined in North America and Europe.
Snap's strategic shift towards diversifying revenue streams beyond advertising is yielding mixed results, according to its latest quarterly report. The company reported a 10% year-over-year increase in Q4 revenue, reaching $1.7 billion, and a net income of $45 million. A key driver of this growth is Snap+, the paid subscription service, which saw a 71% surge in subscribers to 24 million.
Despite these gains, the platform experienced a slight decrease in daily active users, falling from 477 million to 474 million, with declines noted in North America and Europe. The company also anticipates its first-quarter revenue might fall short of analyst expectations, citing increased competition from platforms like Facebook, Instagram, and TikTok impacting its advertising earnings.
Looking ahead, CEO Evan Spiegel highlighted the company's focus on newer offerings, including charging for Memories storage and the anticipated launch of augmented-reality glasses, Specs, later this year. A new subsidiary, Specs Inc., has been formed to concentrate on developing these glasses, signaling a long-term vision for AR beyond smartphones.
