Even without that one-time cost, however, Snap's loss doubled from the same quarter a year earlier.
Revenue: $150 million reported vs. $158 million expected by a Thomson Reuters consensus estimate. The results include almost $2 billion in stock-based payouts.
Evan Spiegel, Snap's secretive 26-year-old CEO, told analysts on a conference call that he thinks about user growth "through the lens of creativity".
Snap's stock is not taking this less-than-stellar earnings report lightly. Since then, the company has been buffeted by competition from Facebook and comparisons to Twitter, the social media service that has suffered from anemic user growth.
Daily active users grew from 122 million in Q1 2016 to 166 million in Q1 2017, an increase of 36 per cent year-over-year. Meanwhile, Facebook has launched Snapchat copycat features like its own version of Stories.
"Snap user growth is nearly zero".
Snap conceded in IPO paperwork that there is no guarantee it will attract older audiences.
The number of active daily users, which many industry experts had called as the most significant statistic of the day, was up to 166m this quarter from 158m last.
He continued that he's not surprised to see other companies following Snapchat with a camera-first strategy. You also now get a Loop tool so that your video snap can either just play once or loop forever until your friend goes away. But, he added, "just because Yahoo has a search box, it doesn't mean they're Google".
Up until now, you could set your snaps to be viewed between 1 to 10 seconds. But not anymore! Popular photo-sharing app, Snapchat has added four new tools to its creative arsenal to counter "Facebook's influence" over its users. In its first post-IPO report in 2012, Facebook also disappointed investors when its daily user base grew by only 32 percent.
With its first earnings results, Snapchat risks suffering the same fate as its social media rivals.