Snapchat shares are in a nosedive. The social network’s securities are down around 25 percent. Snapchat blames Apple for this. Because the new app tracking on the iPhone would massively harm the company. We explain the background.
57 percent more revenue, quarterly earnings of over one billion dollars and two-thirds less loss: that doesn’t sound bad at first. But what could have been a nice present for Snapchat on its tenth anniversary is currently turning into a nightmare.
Investors on the stock market were anything but thrilled. At times, they let the Snapchat share plummet by up to 25 percent. The sometimes rapid drop in the share price even dragged other social networks down with it. Facebook and Twitter lost six and seven percent respectively.
Snapchat share: Quarterly figures worse than expected
The supposedly simple reason for the plunge in the Snapchat share price: the quarterly figures are worse than expected. With 1.067 billion dollars, Snapchat did crack a new high for the first time in the third quarter. However, the market expected a turnover of around 1.1 billion dollars.
In the previous year, however, the loss was still around 200 million dollars. Meanwhile, Snapchat blames Apple for failing to meet its forecast and for the plunge in its share price on the stock market. The new data protection regulations for app tracking on the iPhone are partly responsible for the poor figures.
App tracking: Snapchat blames Apple for the misery
Apple introduced new privacy regulations a few months ago. Since then, app developers have had to ask their users for permission to allow the app to track their usage behavior. Many users refuse to do so. This is causing some advertising models to falter.
Facebook has long criticized Apple’s new app tracking. Snapchat, meanwhile, has been reticent. Now, however, the company has announced that the software alternative that Apple has made available is unsuitable for determining advertising data.
But it’s not just Snapchat that is suffering from Apple’s app tracking regulations. The drop in Facebook and Twitter’s share prices reveals that other social networks are also affected. Both companies plan to announce their quarterly figures next week.
Snapchat, meanwhile, expects revenue to continue to be affected by the privacy changes in the fourth quarter.