After Apple defied the expectations, Shares in Snapchat creator Snap Inc fall to all-time low

Shares in Snapchat’s parent company Snap Inc fell to an all-time low today, tumbling as much as 22 per cent after the social media firm missed first-quarter user targets yesterday.

In its annual statement last night, the messaging app revealed it had only seen a 15 per cent increase in users from last year, while the company’s adjusted losses in earnings before interest, taxes, depreciation, and amortisation was $217m in the first quarter of 2018.

That represents an increase in losses of 16 per cent year-over-year and 37 per cent sequentially.

Read more: Snap shares slump as it fails to woo users following app redesign

Snapchat has faced a user backlash after its major redesign last year, as well as controversy after it appeared to make light of singer Rihanna’s 2009 assault by her former boyfriend Chris Brown.

The company, which was originally valued at $25bn (£18.4bn) lost $541m in 2016, and earlier this year, the company admitted that the video and image sharing platform may never become profitable.

Read more: Rihanna blasts Snapchat – shares fall

Commenting on Snapchat’s fall from grace, Michael Hewson, chief market analyst at CMC markets UK said:

“When Snap first came to market last year, it was a little difficult to separate the hyperbole from the facts in terms of market enthusiasm for a company that wasn’t, and still isn’t any closer to making a profit.

“Snap certainly wouldn’t be the first company to struggle in terms of profitability, but in the longer term investors still need to see evidence of progress, and so far this seems rather thin on the ground.”

By contrast, Facebook, whose video and photo-sharing app Instagram is a direct competitor to Snapchat, posted surprisingly strong earnings last week, with a 63 percent growth in profit, despite the data breach scandal that has hit its parent company.