Snapchat’s User Growth Falls as Facebook’s Copycat Act Pays Off

In its first quarterly earning report, the company said user growth had slipped to its lowest in two years.

A file photo of Snapchat co-founders Bobby Murphy, left, and Evan Spiegel ringing the opening bell at the New York Stock Exchange. (Photo: AP)

It wasn't the day Snap Inc – the parent company of Snapchat – had planned for. In its first quarterly earning report after going public in March, the company saw its user growth slipping to its lowest in the past two years, reporting 166 million users at a growth rate of a mere 5 percent.

Snap's year-on-year growth rate fell to 36% from 48% in the fourth quarter last year, according to reports on Thursday.

Besides, Snapchat co-founders Evan Spiegel and Bobby Murphy each lost more than $1 billion.

As per the details shared by Snap, they’ve added just three million new users in North America to hit 71 million daily active users (DAU). The company added three million in Europe with 55 million DAUs.

Also Read: Snapchat Backlash: When App Ratings Bear the Brunt of Public Anger

On the other hand, its nearest competitor, Facebook-owned Instagram, currently has 700 million users, with its "Stories" feature boasting 200 million daily active users.

Facebook has been bent on copying Snapchat ever since the social media giant tried unsuccessfully in 2013 to buy the app.

Speaking about this, Spiegel said:

You have to expect people are going to copy you. Just like how Google forced companies to develop their own search strategies, Snapchat is forcing competitors to develop a camera strategy.

Growth in Snapchat's user base began to slow down last year after Facebook's Instagram copied Snapchat's "Stories" feature, which lets users post short video clips that disappear after 24 hours.

(With inputs from AP)