Snap Inc. Decreased, SNAP Shares And Tokens Also Decline

Snapchat developer Snap Inc is experiencing difficulties in restoring the market after the pandemic to date, resulting in the drop in the price of SNAP tokens and their shares. (Photo; Doc. KSA Wats)

JAKARTA - Snap Inc., the parent company of the Snapchat app and the SNAP token, slumped after reporting disappointing fourth-quarter results. The company's revenue only rose 5% on an annual basis, from $1.3 billion to $1.36 billion, below analyst expectations. In addition, the company also projects lower first-quarter revenues from market expectations.

California-based company, USA, is facing difficulties in restoring user growth and advertising revenues after the Covid-19 pandemic. Snap is also affected by intense competition from other social media platforms, such as Facebook, Instagram, and TikTok. Snap also announced it would reduce 10% of employees, or about 530 people, in an effort to save costs and increase efficiency.

As a result of poor financial reports, Snap Inc.'s shares fell nearly 30% in trading after working hours on Monday, February 5. These shares have fallen more than 50% since hitting an all-time high in November 2022. Some analysts lowered Snap's share price targets, expressing concerns about the company's long-term prospects.

One of the critics of Snap's performance is Kamaran Ansari, a headline venture partner, who has worked as head of corporate strategies and business development at Snap. In an interview with Yahoo Finance, Ansari said that Snap's movement "has been flat in the past year or more" and is "still losing a lot of money". He suggested that Snap focus on product innovation and improving service quality, not just on user growth.

Meanwhile, the SNAP token, which is a digital asset issued by Snap Inc. in 2022, has also decreased. This token is intended to provide incentives to users and developers who contribute to the Snapchat ecosystem. However, this token is not in great demand by the crypto market.

According to data from CoinMarketCap, the current price of the SNAP token is 0.00.1814 US dollars (Rp2.83), down 0.34% in the last 24 hours. The market capitalization of this token is 58.732.68 US dollars (Rp915.6 million), with a trading volume of 4.77 US dollars (Rp74.3 thousand). This token is ranked 7288th in the list of more than 11,000 cryptocurrencies on CoinMarketCap.

However, there are some positive news that might boost the price of SNAP tokens in the future. One of them is the launch of the Black Order season on Marvel Snap, a digital card game that uses SNAP tokens as crypto assets in the game. This season features the characters of Avengers: Infinity War and Endgame, which are expected to attract Marvel fans.

In addition, Snap is also planning to develop a Web3 platform, which is a vision of decentralized internet supported by blockchain technology. Snap hopes to leverage Web3 to improve user experience, privacy and security, as well as create new opportunities for developers and creators. Snap has also joined Crypto Open Patent Alliance (COPA), an initiative aimed at preventing innovating crypto patents.

Thus, Snap still has the potential to rise from adversity, provided it can execute its business strategies and plans well. However, this company must also be prepared to face the challenges and risks that may arise along the way, both operationally, regulatoryly, and competitively.