Snap Inc. on Tuesday said revenue rose 54% in the first quarter from a year ago, but that missed analyst estimates and fell almost 20% short of the previous quarter as efforts to wrest a larger share of advertisers' budgets were impeded by Facebook Inc. and Alphabet Inc.'s Google.
Unable to sustain the momentum that boosted its earnings in the previous quarter, Snap stock plummeted 17% in after-hours trading.
As any teen could have told you, Snapchat's controversial redesign was largely to blame.
The Facebook (FB) rival reported revenue of $230.66 million, up 54% from the year-ago quarter.
It added just 4 million new users in the recent quarter, for a total of 191 million daily active users - again falling short of expectations, and raising doubts about its growth prospects. It was the company's slowest rate of user growth.More news: Migrant caravan reaches US-Mexico border
He said completely rebuilt Snap app for Android will roll out in the third quarter of the year.
The Venice, California-based firm posted a net loss of $385.8 million, or 30 cents per share, compared with $2.21 billion, or $2.31 per share, a year earlier.
"Our redesign created some headwinds in our revenue this quarter by disrupting user behavior and creating some apprehension among our advertising partners", Snap CEO Evan Spiegel said in prepared remarks.
Despite poor sales, last month Snapchat confirmed a second generation of Spectacles were on the way, with a slimmer design and new ability to take still pictures as well as capture video.
Snapchat was also panned by some of its most prominent users after the redesign.