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Snap Hit by Slowing Growth

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Editor’s Remarks:
Snap Inc’s shares plummeted around 23.5% yesterday off the back of its earnings report, which turned out to be a disappointment despite being its first since the company’s blockbuster IPO. But the figures confirmed what many bearish investors had thought after its huge initial valuation: that slowing user growth and revenues wouldn’t be able to support the hype, particularly faced with Facebook’s feature-poaching onslaught. Audience growth fell short of analysts’ expectations as Snapchat gained only 8 million new daily active users in the first quarter of 2017 – far below Facebook’s 50 million new arrivals. Snap’s shares sank to their lowest price since the IPO in March, wiping off over $6bn of the company’s market value.

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