Snap CEO Evan Spiegel admitted something you already knew: The Snapchat app is too hard to use. Spiegel told investors during today’s third quarter earnings call that the company plans to redesign the mobile camera app to make it easier to use — adding that such a change may cause some temporary “disruptions.”
“We’re willing to take that risk for substantial, long-term growth of our business,” Spiegel said.
The Venice-based company fell short of Wall Street’s revenue forecasts for the third quarter. Snap brought in $207.9 million in revenue, up 62% from a year ago, but short of analyst forecasts of $236.9 million. The company’s quarterly loss reached $443.2 million, or 36 cents a share, considerably deeper than the $124.2 million a year earlier.
Spectacles, the video-recording glasses that Spiegel trumpeted at the recent Vanity Fair New Establishment conference, bragging that the company had sold over 150,000 pairs, turned out to be less than the rousing success. The company wrote off $39.9 million in charges related to excess inventory.
Spiegel told investors the company was so overwhelmed by initial reception, it misjudged demand.
“We weren’t able to sell as many as we anticipated,” he said, adding, that he hopes not to repeat that mistake again.
Snap’s stock dropped more than 16% percent in after-hours trading, sagging to $12.60 a share.