Published: Wed, May 02, 2018
Research | By Francis Brooks

Snap CEO Evan Spiegel Stands By Redesign Despite Rocky Q1 Results

Snap CEO Evan Spiegel Stands By Redesign Despite Rocky Q1 Results

Estimates have increased by two cents for the current year over the last two months, and the Zacks Consensus sits at a loss of 53 cents per share. The social media company posted an adjusted diluted loss per share of $0.17 on revenues of $230.67 million.

Those earnings represent big misses, even as the growth in daily active users slowed to 2 percent from the previous quarter.

The tech company announced that its earnings tallied up to a loss of 17 cents per share for its first quarter of fiscal 2018, which was in line with the 17 cents per share of losses that analysts polled by Thomson Reuters were calling for. Cost of revenue per use rose 5% year over year and 1% sequentially to $1.03. Capital spending doubled from $18 million a year ago to $36.3 million.

Snap CEO Evan Spiegel defended the company's widely criticized decision to redesign its app on its conference call after releasing underwhelming first-quarters numbers were released Tuesday.

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Company executives acknowledged that the new design hurt results but said they were sticking with the plan to keep content from friends separate from other publishers.

Investors are not amused with Snap's report.

Shares in Snap were in free-fall in after-hours trading after it revealed user growth was dented by its controversial redesign, and said it expected growth to "decelerate substantially" in the second quarter.

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