Snap adds users, shares soar by 30 per cent

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Spiegel said early feedback shows the redesign makes the app easier to user, "especially for older users".

Not only is the equation simple; it's successful.

The California-based company says that it's been able to retain users on Android after pushing out an update to fix major bugs.

Snap Inc, the parent company of popular image-sharing app Snapchat, has unveiled better-than-expected earnings for 2017 - but still posted big losses.

"Anybody can log on to our platform and buy advertisements".

Snap said the average revenue per user rose 46 percent from a year ago to $1.53, offering some hope for reaching profitability. However, according to the company's results for the fourth quarter of 2017, Snap is doing pretty well.

"Snap made significant progress on redesigning the user experience, with some proof points around engagement", Canaccord Genuity analyst Michael Graham said.

The company's revenue isn't much of a surprise to Forrester analyst Jessica Liu and may be the result of a growing industry, not a new special sauce that Snap executives introduced during the fourth quarter.

The platform's advertising system has also seen some positive momentum, with the auction-based setup making buying ads on Snapchat a snap. Meanwhile, the company suffered a net loss of $350m - nearly $100m better than Q3 2017 - compared to Wall Street estimates of between $405m and £410m. 90 per cent of Snapchat's Q4 ad impressions came via its self serve programmatic ad manager, released earlier this year.

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However, the broader availability of Snapchat's inventory has corresponded with a reduction in the value of each ad.

Snap shares traded at $17.73 on the news, a 26 per cent increase, according to Reuters.

Social media can be great for staying in touch with friends and family you don't see enough, but we all have that one friend who takes things a little too far. "A drop in quality takes users' attention elsewhere and Snapchat is now facing that challenge", Ben-Itzak said. He believes the strength was driven by small- to medium-sized businesses.

Twitter reports fourth-quarter earnings after the market close Thursday. The company's stock chart Tuesday afternoon looked similar to the trajectory of Elon Musk's SpaceX rocket, launched into outer space just minutes before Snap reported - straight up.

To catalyze its future ad revenue growth, Snap plans to automate even more of its ads.

The bulk of Snapchat's revenue comes from advertising, with ads displayed within the apps stories format. On a conference call, Snap also sounded a bit more grown up and talked about moderating expense increases and noted cash burn fell 49 percent.

In other news, Director Mitchell Lasky sold 25,000 shares of Snap stock in a transaction dated Tuesday, January 30th. But that is changing. Investor enthusiasm for the instant messaging application company faded after its initial public offering previous year. North America, however, is a crucial market for both Facebook and Snap, and the latter saw faster growth.

Tim Peterson, Third Door Media's Social Media Reporter, has been covering the digital marketing industry since 2011.