Snapchat lost 3 million daily users in the past three months

Though Snapchat has been hard at work adding new features like group video chats and “Harry Potter” Bitmojis, things haven’t so rosy at the company as of late.

User growth slowed down last quarter, Instagram continues to eat its lunch, and Snap’s Spectacles division chief recently left due to recent restructuring efforts.

Which doesn’t sound too good, especially since the company just came out with the new, smaller Spectacles 2. And today, there’s even more bad news.

According to the Snap’s second-quarter earnings report, the number of daily active users have dropped from 191 million in the first quarter of the year to 188 million. That’s a drop of 2 percent, or 3 million users, since the last quarter, and marks the first time that user count has dropped in the company’s corporate history.

Yet, things are not all bad. That 188 million daily active user number is 8 percent higher than this time last year, and CFO Tim Stone said that monthly active users are now up to 100 million in US and Canada.

Also, overall revenue is now $262 million this quarter. That’s a 44 percent year-over-year increase and an 11.9 percent increase from last quarter.

Snap is still operating at a net loss of $353 million, but it has decreased by 20 percent since this time last year. In other words, it’s losing users, but it’s making more money. Perhaps partly due to a recent investment of $250 million by Prince Al-Waleed Talal of Saudi Arabia.

The drop in daily active users is an unfortunate turn for the company, as it struggled with a tepid reaction to its app redesign late last year as well as continuing problems with its Android app.

In his prepared remarks, CEO Evan Spiegel said that the decline was primarily driven by the disruption caused by the aforementioned redesign.

“It has been approximately six months since we broadly rolled out the redesign of our application, and we have been working hard to iterate and improve Snapchat based on the feedback from the community,” he said.

“Even though our iterative efforts to improve the existing application have helped increase new user retention on Android by nearly 20 percent since Q4 of 2016, we believe that rewriting the application presents a big opportunity because it takes advantage of the latest Android capabilities and has a modularized structure that will make it easier for us to innovate in the future,” said Spiegel.

Snap did reveal that 11 of its Shows now have a monthly audience of over 10 million users, which is up from the 7 million in the last quarter. “The number of people that watch Publisher Stories and Shows on iOS every day has grown by more than 15 percent this year,” said Spiegel. Users spend an average of over 30 minutes on Snapchat every day, he added, and user retention for people older than 35 has increased more than 8 percent.