Snap CEO Evan Spiegel Stands By Redesign Despite Rocky Q1 Results

Snapchat voice chat

Snap Inc. on Tuesday said revenue rose 54% in the first quarter from a year ago, but that missed analyst estimates and fell almost 20% short of the previous quarter as efforts to wrest a larger share of advertisers' budgets were impeded by Facebook Inc. and Alphabet Inc.'s Google.

The stock got clobbered in after-hours trading, falling as much as 17%.

Snapchat parent company Snap Inc.is looking for more ways to generate revenue, it has since chose to test a six-second ad aptly called "Commercials".

The revamp of its app, unveiled late past year, was widely met with a negative response by users, and share prices were sent tumbling when reality star Kylie Jenner voice her disapproval of the new look and layout.

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The daily active users figure also came in below Wall Street's expectations of 194 million.

It looks like Kylie Jenner's return to Snapchat wasn't enough of a boost for the app.

Revenues for the quarter were up 54% year-over-year to roughly $231 million, but sequentially were down 19% "primarily due to seasonality and our redesign", the company said in its earnings release. At the time, Citi analysts also said the redesign was not popular with many of Snapchat's users or with influencers.

"We are already seeing signs of stabilization among users, but still have work to optimize design among Android users", Spiegel told reporters and investors. And after months of standing by the changes, the company last month was forced to backtrack, promising to redesign the redesign.

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