Snap (SNAP) posted its second consecutive quarter of declines in daily active users, highlighting the company’s continued struggles to stem user outflow to competitors including Instagram.
Daily active users came in at 186 million for the third quarter versus consensus estimates of 186.8 million, a 1% decrease from the second quarter. The company expects that daily active users will decline again in the fourth quarter.
The Venice, California-based company delivered record quarterly revenues of $298 million, beating estimates of $283.36 million, according to data compiled by Bloomberg. Adjusted loss came in at 12 cents per share, or 2 cents better than consensus expectations of a loss of 14 cents per share. The company expects fourth-quarter revenue to be between $355 million and $380 million.
Shares of Snap tumbled 14.02% to $6.01 each as of 9:46 a.m. ET Friday.
Snap’s latest results come in the wake of steady declines for the company’s stock, which hit its lowest closing price of $6.59 per share earlier in October. The stock was down more than 50% in 2018 as of market close Thursday.
“We’re investing in long-term growth opportunities and driving operational efficiencies,” Tim Stone, Snap CFO, said in a statement. “We achieved record revenue and strong bottom-line results this quarter and expect a record fourth quarter, as we continue to invest in innovation for our community and scale our business.”
Snap has yet to report a profit since making its initial public offering in March 2017. CEO Evan Spiegel sent a 15-page memo to employees in late September outlining a plan for the company to achieve full-year profitability in 2019.
Underscoring Snap’s financial concerns are worries that the company is losing the social media arms race to competitors including Facebook-owned Instagram. The photo-sharing app unseated Snapchat as the most-used social media platform among the key teenage demographic, according to a recent semi-annual Piper Jaffray survey. Snap also reported a decline in daily active users in the second quarter, leaving some analysts questioning the long-term health of the social media company.
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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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