We all know the “success stories” that abound in the world of mobile applications. Snapchat is one of them: a listed company was born from a small instant chat app and is seen as one of the most conducive to growth in the next few years.
It recently changed its concept by allowing users to choose to stop messages from self-destructing on Snapchat for the first time. Enough to suggest that the company is still just as dynamic, but cold to real eyes…
Snapchat goes straight to the wall
Snap Inc’s Q1 2017 financial results show just how dire the company really is: It will have spent $2.3 billion in these 3 months, but it only made $149 million to offset this aggressive investment.
Worse still, the active user rate is now slow, only 5% for 166 million. While the application may benefit from better evaluation of Android users for this, he admitted that he prefers iOS for now.
This is obviously far from satisfying investors who have just opened their eyes to the very temporary status of this social network. Snap Inc share price has already dropped 20% to 25% in the first hours of opening, erasing the slightest progress since its launch.
However, it’s not because of the lack of good ideas and the lack of evidence: competitors like Facebook are constantly getting them. But the truth is that there is no viable business model yet to support the developer’s activities. Frankly, Snapchat is on its way to being just one of the many bubbles in this market.
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