Snap is trying to break its ad addiction, and according to their Q4 earnings and reporting from Reuters, the results are… mixed.
Fewer friends, more pocket change: Revenue hit $1.7B, and net income is up.
However, Snap lost 3M daily active users in high-value markets like North America and Europe.
Snap+ grew 71%, reaching 24M users. It turns out people will pay for Memories storage and exclusive features after all.
The company is also placing a massive bet on augmented reality with the creation of Specs Inc.
By spinning hardware off into a standalone brand, Snap hopes to attract a different audience segment.
The actual plan for the new AR glasses seems a bit blurry. CEO Evan Spiegel mentioned they are focusing on nailing the launch while remaining flexible on how to monetize.
That usually means we will see a price tag once they gauge the hype.
Snap is transitioning to hardware while its core user base in premium markets shrinks. It is a bold, expensive gamble, but the success of Snap+ shows there is a path to profit.
We are watching closely to see if Specs Inc. can actually compete with the giants….
