The social app’s parent company, Snap, in its Q2 2020 earnings report, said it has added 9 million daily active users over the last quarter with a 17% year-on-year growth. Globally, the company today is hosting 238 million daily active users. Compared to the same time last year, Snap added that its revenue is also up by about 17% at $454 million, $66 million more than Q2 2019.
Despite the industry-wide revenue and advertising slump, Snap has been able to keep its head above water and also hasn’t announced any layoffs in the pandemic. The company wasn’t completely immune to the economic downturn, however. Its business took a significant hit especially in March when its growth dropped by about 25%.
Snap’s leadership, however, remains optimistic and believes its investments in audience-focused products and advertising partners will allow it to offset that loss as countries return to normal.
“The economic environment has become challenging for many of our advertising partners and this has had an impact on the rate of growth in our business,” said Derek Andersen, Snap’s chief financial officer, on the investor’s call.
“We are cautiously optimistic that trends could improve over time if conditions begin to normalize, but we are also conscious that economic conditions may not improve and some of our advertising partners could continue to face headwinds caused by the crisis,” he added.
Nearly every online service has experienced a surge in activity and therefore, Snapchat’s user base’s upward trajectory is no surprise. As expected, it also saw “a sharp increase in group-related activities across chat, calling, and games” as shelter-at-home orders put physical contact out of the question. What will remain especially challenging for it is to sustain advertisers’ interest, considering worsening coronavirus conditions in the United States — the app’s biggest market.
Earlier this week, Snapchat rolled out Snap Minis that allow users to perform a wide range of third-party actions such as meditating on the Headspace platform or browse movie tickets without ever leaving the messaging app itself.
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