Saudi billionaire takes stake in Snap

Saudi billionaire takes stake in Snap

Last quarter, its stock dropped by as much as 24% after releasing its first-quarter earnings report.

The photo and video sharing app reported daily active users for the last quarter of 188 million, down from 191 million in the first quarter of the year.

Shares in Snap climbed more than 12 percent in after-hours trading before reversing course and going flat.

Spiegel said Snapchat's drop in daily users "was primarily driven by a slightly lower frequency of use among our user base due to the disruption caused by our redesign".

At the end of a savage technology-sector earnings season, which saw Twitter and Facebook badly mauled after reporting poor numbers, Snapchat's anaemic performance was explained away as a redesign issue by CEO Evan Spiegel in prepared remarks with analysts.

The company has struggled with a rocky redesign widely criticized by users.

Analysts on average expected Snap to gain almost 2 million users in the second quarter from the first.

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).

Liverpool vs. Torino - Football Match Report
Liverpool's Georginio Wijnaldum celebrates scoring their second goal with team mates. In the end, that would be it for a game that would finish 3-1.

Saudi billionaire Prince Alwaleed Bin Talal has taken a 2.3% stake in Snap, buying $250m (£194m) worth of shares in the social media company.

Snap's user growth has pulled back sharply over the past two years. The company also grapples with heightened competition from Instagram, which regularly copies its most popular features.

A Snapchat redesign in February aimed at encouraging users to watch more videos prompted user protests after they found it more hard to find the content they wanted.

Investors, it seems, are unsure what to make of Snap's mixed results.

The Venice, California-based company said it had a loss of 27 cents per share.

Snap lost about 1 million users in each of its three geographic reporting regions: North America, Europe and rest of world.

For the three month period from April through June, Snap's revenue rose 44% year-over-year to $262 million. The stock jumped immediately following the IPO but has lost some 50 percent since. The redesign meant to put more of the public content front and centre sparked user backlash earlier this year. Snap later made updates to roll back some of the more unpopular changes, but the damage was done.

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