Snap Inc. says that its Snapchat app added 37 million daily active users in its third quarter, giving it 443 million total, and that time spent watching content rose by 25 percent year over year.
Revenue was $1.37 billion, up 15 percent year over year, while the company posted a net loss of $153 million, a significant improvement compared to a year earlier, when its losses were over $368 million.
“I’m proud of the team’s progress this quarter, delivering strong community growth and deepening engagement while driving improved financial performance,” said Snap CEO Evan Spiegel. “Our investments in AI and AR are powering new creative experiences for our community and driving innovation across our advertising platform, underpinning our long-term growth opportunity.”
The growth in active users comes at a pivotal moment for Snap, which says it will begin to roll out its new “simple” Snapchat app in Q1 2025 “at the earliest.” The company says that about 10 million users are currently testing it, and that they expect to continue testing and iterating before a wider launch.
The new app is meant to enhance content discovery, combining Snap and Snapchat Spotlight in one unified video feed, and bringing Snap content to its chat functionality.
In the letter the company says that “we are encouraged by early testing results that show content engagement gains among less frequently engaged users of Snapchat as we believe this can be an important input to impression growth and incremental reach for advertisers.”
But the company also warned that the engagement metrics aren’t as positive on iOS devices as they are on Android, and that there could be some bumpiness as the company migrates to the new app.
“While we believe growth in content engagement and demand for the new ad placements may build over time, many of the changes associated with Simple Snapchat occur immediately as Snapchatters transition to the new user experience, which presents the risk of near term disruption,” it wrote in the letter.
Ultimately the company believes the new app will drive more engagement for users and lead to higher ad revenues.
“By simplifying the experience, we’re really doubling down on how people actually use their phones, chatting, making snaps, and watching content, which are the three main pages here,” Jim Shepherd, Snapchat director of global creator and content partnerships, told The Hollywood Reporter in an interview last month. “We really feel strongly that those behaviors really reinforce each other.”
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