Shares in the owner of instant messaging app Snapchat fell by more than 31% at times in after-hours trading on Tuesday as Snap announced its fourth quarter and full year 2023 results.
Snap missed analysts' revenue expectations and shocked investors with a surprisingly high loss forecast for the current quarter.
Fourth quarter revenue increased by 5% year-on-year to $1.36 billion. Analysts had expected an average of $1.38 billion. The bottom line was a loss of about $248 million in the quarter, following a loss of $288.5 million a year earlier.
For the current quarter, Snap is forecasting revenue of between $1.095 billion and $1.135 billion. The company expects a loss before interest, taxes, depreciation and amortization of between $55 million and $95 million.
Meanwhile, the number of daily users is expected to rise from 414 million to 420 million.
"2023 was a pivotal year for Snap, as we transformed our advertising business and continued to expand our global community, reaching 414 million daily active users," said Snap boss Evan Spiegel.
"Snapchat enhances relationships with friends, family, and the world, and this unique value proposition has provided a strong foundation to build our business for long-term growth."
Snap, which has previously grown rapidly, has been struggling with slow advertiser sales growth as advertising dollars have been flowing towards large competitor platforms from the Facebook group Meta or Google.
On Tuesday the California-based company announced that it would cut around 10% of its global workforce. As of the end of December the company had over 5,200 employees.