Snapchat announces a $2.2 billion loss in its first quarterly report

Snapchat has been billed as the next great social media/promotional platform, the one that the next wave of kids are jumping to as the behemoths of Facebook, Twitter and Instagram supposedly fall by the wayside.

The numbers, however, don’t quite bear that out. As CNET reports, the company behind Snapchat has just revealed its first quarterly report, and the numbers are a little scary. Snap’s announcement of a loss of $2.2 billion dollars equates to $2.31 for each share, and is monstrous in comparison to the $104.6 million in the previous year, a mere 14 cents a share.

While Snapchat’s daily active users have grown from 150 million during its March IPO to a total of 160 million, it isn’t the startling leap many would have been hoping for, and Instagram’s replication of its features in its Stories feature have seen it post numbers over 200 million last month – hardly knocked off its perch.

The platform will continue to face stiff competition from Facebook, too, which hasn’t turned a blind eye to the forward-thinking augmented reality features that have been Snapchat’s bread and butter, although CEO Evan Spiegel attempted to shake off concerns of competition during today’s earnings call.

“If you want to be a creative company, you’ve got to get comfortable with and basically enjoy the fact that people are going to copy your products,” TechCrunch quotes. “Just because Yahoo, for example, has a search box, it doesn’t mean they’re Google.”

Meanwhile, the company’s own attempt at thinking outside the box – its much-maligned camera glasses, Spectacles – managed to generate a mere $8m in revenue, with CFO Andrew Vallero describing the product’s success as “modest”.

It’s not all bad news coming from the social media company, however, as they point to two billion of those dollars being used towards stock-based payouts, noting that revenue has quadrupled from a year ago and now sits at $149.6 million. Similarly, revenue per user has almost tripled, now sitting at 90 cents.

As CNET notes, concerns over Snapchat’s viability are nothing new, with its IPO filing coming along with the announcement of a complete lack of profitability since its inception in 2011 and a deficit at the time of $1.2 billion dollars, adding that the company “may never never achieve or maintain profitability.”

Even then, the shares were worth $24.48 at the time of the IPO, but after today’s revelations have dropped to $17.73.

With artists constantly on the lookout for the latest and greatest way to connect with fans, Snapchat has been considered by many to be the next ship to jump to – but there appear to be more troubled waters ahead.

This article originally appeared on The Industry Observer, which is now part of The Music Network.