Snapchat delivered another disappointing quarter on Thursday, adding fewer users and bringing in less revenue than Wall Street expected, and the stock dropped as much as 13 percent in early after-hours trading.
The relevant numbers:
- Snap added seven million new users for the quarter. It added eight million in Q1, and analysts were hoping for closer to 10 million new users in Q2.
- Snap reported a net loss of 16 cents per share on revenue of $181.7 million. Analysts were looking for a loss of just 14 cents per share on revenue of $186 million.
- Snap reported ARPU, or average revenue per user, of $1.05 on the quarter. That was less than analysts expected, and much slower year-over-year growth than the past few quarters. This is an important metric for Snap because the company says it’s a good indicator of its business growth — and a reflection of its strategy to push hard into more mature advertising markets.
These numbers are not what Wall Street was hoping for. The popular messaging company has been clobbered during its first six months on the public markets. Snap stock closed Thursday at $13.67, more than 44 percent below the $24.48 opening-day closing price for the stock back in early March.
Most of the concern with Snap has been related to Facebook and Instagram, which are both copying Snapchat’s best features and, in some cases, going out of their way to try and highlight that their user base is bigger and more engaged.
The fear is that Facebook’s efforts have dramatically hindered Snap’s growth, and it’s hard to argue otherwise. The company’s user growth started slowing down in the back half of 2016, and it’s already falling short of Wall Street growth estimates less than six months in.
The company will host a conference call with investors and analysts at 5 pm ET today. We’ll be listening in and updating Recode along the way.
This article originally appeared on Recode.net.