As was pretty clear from Snap’s earnings report Tuesday – just its third since going public in March – the teen chat app maker has a lot to work on. Its revenue isn’t growing as quickly as expected, the number of people using its Snapchat app is barely growing, and even company CEO Evan Spiegel thinks the app is too difficult for many people to use.
But one key item the company might want to focus on is boosting the amount of money it generates from each of its users. Snap’s average revenue per user (ARPU) increased 39% in the third quarter from the same period last year. That number was up 12% just since the second quarter of this year.
That sounds impressive, but in terms of the actual amount of ARPU Snap is bringing in, the company falls shy of what Facebook, its archrival, was doing at a similar point in its history. As we can see in this chart from Statista, in the period immediately before and after its initial public offering, Facebook was making significantly more money on a per user basis than Snap is now.
- Mike Nudelman/Business Insider