Shares in Snap Inc. plunged more than 16% in late trading today after the company missed on earnings, revenue and global average revenue per user in its fiscal second quarter.

For the quarter that ended on June 30, Snap reported an adjusted loss of 16 cents per share, down from a loss of 15 cents per share in the same quarter of 2024, on revenue of $1.345 billion, up 9% year-over-year. Analysts had been expecting a loss of 15 cents per share and revenue of $1.35 billion.

Snap logged a net loss of $263 million in the quarter, larger than the $249 million loss in reported in the second quarter of 2024, but operating cash flow saw a marked improvement, coming in at $88 million, compared with negative $21 million in the same quarter last year.

Global monthly average users in the quarter came in at 932 million, up 7% year-over-year, and daily active users were up 9% year-over-year, to 469 million. While the company’s user numbers are healthily growing, how much Snap makes for them is struggling, with global average revenue per user coming in at $2.87 versus the $2.90 expected by analysts.

As noted by CNBC, the weaker-than-expected ARPU result is particularly notable as Snap’s social media and online ad peers, such as Reddit Inc., have beaten analyst estimates for ARPU through the current earnings season.

Business highlights in the quarter included Snap introducing several new products and platform enhancements aimed at driving engagement and expanding monetization opportunities, the latter needing assistance given the ARPU figure.

The quarter saw the launch of a dedicated Snapchat app for the Apple Watch, allowing users to view and respond to messages directly from their wrist using dictation, emoji, or scribble features.

Snap also expanded its tools for creators during the quarter with a focus on boosting retention and visibility for “Snap Stars,” the company’s verified creators who have access to exclusive tools and monetization features. Snap Stars now have access to new analytics features that gave more in-depth insights into viewer behavior, including return viewership, time watched and top-performing posts.

The company added a new premium offering under its Snapchat+ subscription service called Lens+, giving users early access to features and exclusive artificial intelligence-powered Lenses.

“Our global community continued to grow in Q2, reaching 932 million monthly active users as we continued to invest in AI and augmented reality,” Chief Executive Evan Spiegel said in the company’s earnings release. “With meaningful inventory and conversions growth this quarter, including the broader rollout of Sponsored Snaps, we’re excited about the opportunity to translate improved advertiser performance into topline acceleration.”

In a small bright note, Snap said that it expects third-quarter revenue of $1.475 billion and $1.505 billion, ahead at the midpoint of the $1.475 billion expected by analysts.

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