Snap stock cratered 15% on Tuesday after reporting disappointing revenue that it partly blamed on a misguided redesign of its flagship service, Snapchat.
Snap stock tumbled $2.34 to $11.79 in after-hours trading, marking one of Snap’s lowest points since the company’s initial public offering in March 2017.
Snap said that its first quarter revenue was $230.7 million, up 54% from $149.7 million from a same quarter a year earlier. The amount fell short of analyst expectations of $244.5 million, partly because of the Snapchat redesign.
The Snapchat redesign, announced in November but rolled out in January, separated users’ friends from brands, celebrities and influencers while moving posts from people that users communicate with often to another part of the Snapchat app. In a sign of the user dissatisfaction, reality show star Kylie Jenner tweeted about her disappointment with the change in February, causing Snap’s stock to fall sharply.
Snap has since partially revised the Snapchat changes by announcing it was testing a new layout that moves some friends’ stories, the photos and videos that users send to others and that appear for 24 hours, to the discover page, where content from celebrities and brands appear.
In addition to disappointing revenue, Snap also reported underwhelming user growth. The number of Snap daily active users grew just 2% quarter-over-quarter. Snap reported 191 million daily active users in the quarter compared to the analyst forecast of 194.2 million.
Meanwhile, Snap’s losses grew to $385.8 million, down from more than a $2 billion loss year-over-year.