Also adding to the uncertainty were signals that Snap was focusing on controlling costs rather than expanding its user base outside of North America and Europe. The company had a net loss of $443 million, or 36 cents a share, in the second quarter.
But it wasn't all bad news.
Turning to the revenue it is generating off those users, SNAP reported that ARPU in the first quarter increased 181% year over year to $0.90, but that it declined 14% sequentially compared to Q4 2016.
"There's a lot of this thing in our industry called growth hacking, where you send a lot of push notifications to users or you try to get them to do things that might be unnatural or something like that", Spiegel told investors in May.
This week the owner of Snapchat published its Q2 2017 earnings report, and it missed a number of Wall Street estimates.
Daily active users: 173 million vs. 175 million expected. But his target price of $9 per share suggests Evan Spiegel's company still has downside.
Snapchat users under age 25 spend more than 40 minutes per day on the app, while those over 25 spend more than 20 minutes a day on the app. However, we believe the company's strong millennial following and innovative product offering have the potential to drive high levels of user engagement, resulting in much higher levels of advertising spending.
"Our dancing hot dog is most likely the world's first augmented reality superstar", Spiegel said. He said the hot dog, which has generated quite a few memes, has been viewed 1.5 billion times in the app. The company is also improving its ad measurement and analytics.
Earlier in the year, Facebook Inc (NASDAQ: FB) launched several features on its Instagram platform that appear to be inspired by Snapchat features and the Wall Street Journal recently reported that Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) Google is developing technology for publishers to create digital content that is similar to Snapchat's Discover feature.
"Given the amount of speculation around the lock-up expiration, I feel it is important to note that Bobby and I will not sell any of our shares this year", Spiegel said on a call with analysts. The pair's post-IPO lockup will expire Monday.
"DAUs have slowed down while rivals like Instagram have demonstrated considerable growth".
TRADEMARK VIOLATION WARNING: This piece was originally posted by Transcript Daily and is owned by of Transcript Daily. Snap's "other" revenue, which is largely comprised of Spectacles sales, was only $5.4 million, down from $8.3 million in the first quarter.
Snap generated 142% more revenue during the first half of 2017 than the first half of 2016 from advertisers who bought an ad during that span previous year. That seemed to suggest that Snap thinks it will eventually have opportunities to sell ads within the feature.