Snap shares tumble as results miss Wall Street targets

Shares (Berlin: DI6.BE - news) in the owner of Snapchat have fallen by a quarter after its first set of results since floating on the stock market missed Wall Street expectations.

Snap reported a loss of $2.21bn for the first quarter, mainly due to stock-based compensation linked to the $24bn float in March.

But it was lower than expected revenues and slowing growth in user numbers that gave investors the jitters.

The shares were down by 25% in after-hours trading in the company - which is facing stiff competition from larger rival Facebook (NasdaqGS: FB - news) .

Snap said its number of daily active users had risen to 166 million, up 5% from 158 million in the fourth quarter of 2016, but lower than some analysts had expected.

Year-on-year growth in users was 36%, slowing from 48% in the fourth quarter and 63% in the third quarter.

Revenues were up nearly four-fold compared to the same period last year at $149.6m but lower than the $158m expected on average by analysts.

Measured per user, revenues were three times higher than in the same quarter last year but 14% lower compared to the previous three months.

The disappearing messaging app, popular with teenagers, attracted huge interest when it went public in New York earlier this year - sending its shares 44% higher in its first day of trading.

But Facebook - which once offered $3bn to buy the business - has upped the ante by offering features similar to Snapchat on its platforms including Instagram and WhatsApp.