is known for its ephemeral pictures and messages, but now users are disappearing too.
The company said users logging in at least once a day dropped for the first time, hitting 188 million over the three months ending June 30, down from 191 million earlier this year. That's after the company reported the slowest user growth ever in May.
Evan Spiegel, Snap's CEO, blamed much of the poor results on an unpopular redesign that was released six months ago that was so unpopular social media influences like Kylie Jenner openly expressed their disappointment. Mix that with a controversial ad shown on Snapchat making light of domestic abuse involving the pop star Rihanna, and Snap just can't seem to get things right lately.
Even before its earnings report, news shot around the internet that the social network had failed to properly lock down its iOS app, leaking portions of the source code to its app.
"These results do not cause us to alter our longer-term view by much," wrote Pivotal Research analyst Brian Wieser in a note to investors. He has a "sell" rating on the stock. "We saw and continue to see Snap as a niche platform."
There are some bright spots for Snapchat. It reported an adjusted loss of 14 cents a share, which was better than the average analyst expectations of a 17 cents a share loss, according to surveys by Thomson Reuters. It also reported revenue of $262.3 million, slightly above analyst expectations of $250.4 million.
Though the company said user counts may fall even further, it didn't provide insights about the recently released Spectacles (which CNET liked but didn't love).
Spiegel is still hopeful.
"We feel that we have now addressed the biggest frustrations we've heard and are eager to make more progress on the tremendous opportunity we now have to show more of the right content to the right people," he told analysts on a conference call Thursday.
And he's not the only one. Saudi investor Prince Al-Waleed bin Talal, whose investing firm owns stakes in Twitter and the Four Seasons hotel chain, said in a tweet that he'd purchased about $250 million worth of the company's shares.
"Snapchat is one of the most innovative social media platforms in the world and we believe it has only just begun to scratch the surface of its true potential and we are blessed to be part of it," Prince Al-Waleed bin Talal said in a statement.
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