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Is Snapchat dead?

Snapchat is a messaging app released on 8th July 2011 that provided an alternative to the pressure-filled environment that social media had become by the early 2010s. Instagram was enormously popular, having grown its user base to 27 million users within 1.5 years of its launch. But signs of discontent were showing. Users were worried if their photos were good enough. People set up WhatsApp groups to share images with each other prior to posting so they could get feedback. Some created alternative accounts where they felt they could be themselves and step away from the pursuit of perfection for at least a little while.

Snapchat was the Instagram alternative. Its ephemeral photo sharing features was a hit, relieving people of the desire to photoshop their images. You could be yourself and in 24 hours, your photos would be gone. Snapchat was so popular that Facebook attempted to acquire it for three times the $1 billion price it paid for Instagram.

But along the way, Snapchat has appeared to be the runner up in the social media wars, with Facebook having the most users and Instagram and TikTok battling it out for legitimacy among the younger crowd. Snapchat has maintained its core ephemeral focus, describing itself as a “fast and fun way to share the moment with your friends and family”. The problem, as we saw when Threads was launched, is that social media companies have no qualms in outright copying a competitor’s ideas.

Founder of Instagram Kevin Systrom once said IG would never, ever have stories. When the competitive pressure became too much and Instagram adopted Stories, a carbon copy of Snapchat’s ephemeral photo sharing feature, Systrom compared Stories to email. It was the new way to communicate, so it wasn’t really stealing. Since then, TikTok, Facebook, Instagram, WhatsApp and YouTube have copied one another’s ideas, managing to grow their user bases in the process. So where does that leave Snapchat? Is Snapchat dead?

Snapchat hasn’t quite reached the billion monthly active user club, the privilege of which belongs to:

  • Facebook (3 billion)
  • YouTube (2.5 billion)
  • WhatsApp (2 billion)
  • Instagram (2 billion)
  • TikTok* (1.6 billion)
  • WeChat (1.3 billion)
  • *TikTok’s user count moves up to 2.4 billion if Douyin’s 800 million users are included.

But although Snapchat hasn’t achieved the esteemed status of its competitors, it’s still achieving consistent user growth, almost doubling its user base of over 300 million in 2019 to over 600 million in 2024. Another indication that an app may or may not be ‘dead’ is the level of activity on the app. It’s fine having hundreds of millions of users, but if they don’t interact and create content, that’s a problem. Given that over 5 billion Snaps are created every day, user engagement doesn’t appear to be a pressing issue.

The next consideration is revenue. An app can have hundreds of millions of users, however if it doesn’t operate with a sustainable business model, it becomes a question of how long investors are willing to keep propping it up before it becomes profitable. Snap Inc’s revenues have increased considerably since the mid 2010s. In 2015, Snap Inc made $58.66 million in annual revenue. By 2023, revenue had exploded to $4.6 billion. However despite the exponential increase in revenues, Snap Inc continued to operate at a net loss. In 2023, Snap Inc made a net loss of of $1.32 billion; a marginal improvement from the net loss of $1.43 billion in 2022. How long can Snapchat continue to operate in the red?

A chart displaying Snap Inc revenues from 2015 to 2023.
Snap Inc’s revenues have grown considerably since 2015, however the company is still making losses.

Despite losses, the continued user growth is likely to keep Snapchat alive for the time being. Artifact, a news app launched by the Instagram founders, decided to shut down after a drop in app downloads. Snapchat doesn’t appear to have this problem. Ultimately, it’s not dead but on shaky ground. Snapchat is operating at a net loss and revenue flattened between 2022 and 2023. Larger apps such as TikTok, Instagram and YouTube have created a significant gap between a primary and secondary tier of social media apps, the latter of which Snapchat resides. Snap Inc’s share price remains at around $11 per share, a sharp drop from its $83 peak in September 2021. Despite issues with its business model, Snapchat has what Meta doesn’t. Legitimacy. Snapchat is one of the few apps that the younger generation are still prepared to associate with, and as long as user growth continues in an upward trend, Snapchat is far from dead.

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