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Photo: Bloomberg

Snap Needs Some Subscription Juice

By  |  Oct. 20, 2022 4:47 PM PDT
Photo: Photo: Bloomberg

Snap’s earnings call had a standout message: The camera app needs to quickly find new ways to tap into its young, growing audience to revitalize revenue growth. One way to do this is by expanding beyond advertising and building a stronger subscription feature. But if Twitter's subscription feature Twitter Blue is any model, Snap has its work cut out for it.  

The Snapchat parent said revenue rose 6% to $1.13 billion, the weakest revenue growth the company has reported since it went public in 2017. At the same time, daily active users increased 19% to 363 million, meeting the company’s forecasts. The vast majority of Snap’s revenue comes from advertising, and that continues to drag. It predicted flat year-on-year revenue growth in the fourth quarter.

Snap is already working on a solution to boost revenue without relying on advertisers’ budgets. Its subscription service, Snapchat+, reached more than 1.5 million paying subscribers in the third quarter. That feature, which was launched in June, charges users $3.99 per month in exchange for perks, like allowing them to see who rewatched stories and change the app’s icon. 

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