News hardware Apple made Snapchat lose 400 million euros
According to the Wall Street Journal, Snapchat is not doing very well. First direct consequence of these economic difficulties: the end of the little Pixy, a selfie drone released barely 4 months ago. The failure is quite bitter, especially when you know that Snap Inc. was planning a second version for next year. You will see, all of this is Apple’s fault.
It’s already the end of Pixy, Snapchat’s selfie drone that had just been released
Everything started very well for Pixy, the small yellow drone launched on April 28, 2022 at a price of €250 (€275 for the version with an additional battery). When it was launched, the success was such that it took almost 2 months to receive a copy.
The Pixie is a particular drone, designed not to take distant shots but to follow and circle around its owner.
The idea was not stupid. After the Spectacles glasses (a product worthy of a spy film), the second object made in Snapchat made it possible to modernize the selfie stick. Here are his technical skills:
- 16 GB of memory
- Sensor 12 megapixel ultra wide-angle for the pictures
- Maximum size of 2.7K at 30 FPS for the videos
Rather not badly, the case seemed destined for a bright future. Unfortunately, Evan Spiegel, CEO of Snapchat, would have announced to his employees the end of the Pixie project on August 18, 2022.
The information comes from internal sources which would have confided to the journalists of the Wall Street Journal. A question then arises: why such a setback? What’s going on at Snap?
Snapchat gains users but loses money because of Apple
As strange as it may seem, in terms of the number of users, Snapchat is doing extremely well both in France and worldwide. Snap has nearly 500 million monthly active users, including 25 million in France alone.
It is among the youngest that success is strongest:
- 72% of French people under 34 use Snapchat every day. This figure even rises to 82% for 15-24 year olds.
- In this age category, the social network with the yellow ghost is simply the most used on a daily basis, ahead of Instagram.
- Snap is still in the top 10 most downloaded offline apps, and its user base continues to climb.
And yet, according to the company’s latest financial statement, the results are very disappointing. A few weeks ago, Snap Inc. announced a net loss of $422 million (the figure is about the same in euros with the current conversion rates).
Why such a high loss? Because Snachat bet too much on advertising. By putting all its eggs in one basket, the ghost is particularly sensitive to the slightest change, particularly in legislation.
Thus, the main explanation for this big loss of income despite an increasing number of users can be summed up in 5 letters: Apple.
Apple has taken new measures to limit the exploitation of iOS user data. Before using the profiles of teens who maintain their flames for commercial purposes, Snapchat must now ask permission from all iPhone owners. A lot of people refuse it, Snap can’t do anything about it, and, wow, minus 400 million euros.
Following the announcement of this immense lossSnapchat’s stock fell on the stock market. To reassure the financial markets, Evan Spiegel has decided to refocus on the company’s core business. No more goodies, hello Snapchat+, a premium and obviously paid version of Snapchat.
For the moment, the bet seems to be winning since Snapchat+ already has more than 1 million subscribers.