Snap stock is tanking after its first-ever earnings report missed expectations

Snap reported earnings for the first time today, and Wall Street isn’t happy. Shares are down more than 20 percent in after-hours trading.

The company, which makes the popular messaging app Snapchat, reported first-quarter revenue of $149.6 million. That’s up significantly from the $39 million Snap brought in during the same quarter last year, though it’s lower than Wall Street was expecting; analysts were hoping the company would generate $158 million this past quarter, nearly quadruple its Q1 revenue from a year ago.

Snap also reported a net loss of more than $2.2 billion for the quarter, $2 billion of which it attributed to “stock-based compensation ... related to RSUs with a performance condition” tied to its recent IPO.

Snapchat’s user base did grow by eight million in the first three months of 2017, and the company now has 166 million daily users. One analyst, RBC Capital’s Mark Mahaney, pegged Snapchat’s projected user base at 165 million. (Instagram, for comparison, has 400 million DAUs.)

Snapchat’s user growth was one of the key metrics for the company. That growth slowed in the back half of 2016, thanks in part to increased competition from Facebook, which has seemingly made it a top priority to squash Snapchat into oblivion by copying its best features.

There was concern that Facebook was indeed stunting Snapchat’s growth. The company is not growing at the rate it was in the first half of 2016, but it did add more users in Q1 than it did in Q4.

There’s also a cost item that’s eye-popping: $1.9 billion in stock-based compensation, which the filing explains as “the recognition of expense related to RSUs with a performance condition satisfied on the effectiveness of the registration statement for our initial public offering.”

We’ve asked about the expense, but it’s likely related to the bonus stock CEO Evan Spiegel was granted as an incentive for taking the company public. But even that wouldn’t fully account for the high sum. Update: On the earnings call, the company confirmed the expense was primarily related to Spiegel’s bonus, which it vested earlier than originally planned.

Snap’s earnings release was very simple, with just a few bullet points. The company will hold a call with analysts and investors at 4:30 pm ET to provide some more context, and we’ll be listening in and liveblogging the event — click here.

This article originally appeared on Recode.net.

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