Snapchat Loss In Q3 Due To Apple's New Privacy Policy

Snap reported a loss in the third quarter (Q3) of this year. (photo: doc. unsplash)

JAKARTA - Snap reported a loss in the third quarter (Q3) of this year, with only revenue of USD 1.07 billion from the previously estimated USD 1.1 billion.

However, Snap, the parent company of social media Snapchat, recorded 306 million daily active users, up from the 293 million reported in Q2 some time ago. That growth looks very healthy for a platform that is at risk of falling from the problems that have recently emerged.

The earnings that did not meet expectations were conveyed by Snap CEO Evan Spiegel who stated that the losses he received in Q3 were the result of major Apple iOS privacy changes. By imposing new restrictions for apps that want to track user behavior beyond their own limits.

Spiegel said he was surprised by how disruptive the impact was on advertising tools. Without the broad view that many advertisers are accustomed to, they will have to adapt to a new, more controlled way of measuring user behavior.

"The tools are basically blinded," said Spiegel as quoted from TechCrunch, Friday, October 22.

However, Spiegel believes that this loss is only a temporary slip, he also said that the current situation is adapting to the new normal, it just takes time and the long-term impact of Apple's advertising changes remains to be seen.

He also looked at the role of broader pandemic market trends in Snap's underperforming. Snap isn't the only ad business adapting to iOS changes, and that's a huge boon to user privacy.

Facebook claims it will soon see a significant impact in Q3 due to Apple's new policy, which reduces the company's ability to target ads. It's no surprise, then, that most people opt out of the cross-platform tracking that ad businesses like Snap and Facebook rely on when faced with a choice.

Unlike Facebook's leadership, Spiegel actually supports Apple's decision to build more privacy into its mobile operating system regardless of how the change might affect Snap's bottom line.