Snap (SNAP) is set to report its second-quarter earnings after the bell and it has a lot to prove to investors.
The stock has had turbulent ride for the past few months, with shares now trading well below its IPO price of $17.
Here are some of the biggest areas of concern for investors:
1. Revenue growth has been slowing, and so far Snap has not been able to deliver the Facebook-like growth investors were clamoring for.
Snap is expected to report revenue of $185.7 million, that’s about $35 million more than its last report, with an earnings per share loss of $0.15 (or GAAP earnings of -$0.33).
The company surprised investors last quarter with a massive loss due to stock-based compensation, which included the nearly $1 billion award for CEO Evan Spiegel.
2. Then there’s the issue of competition. Facebook’s (FB) Instagram now has over 250 million daily users, well beyond the 166 million on Snapchat.
But Snap has said what makes it so special is that people spend so much time on the app, from 25 to 30 minutes per day. However, Instagram recently reported similar numbers.
3. Finally, Snap’s user growth has been slowing, as well as its average revenue per user.
If Snap can break any of these trends, that’ll be welcome news for investors, but it’s learning quickly that life as a public company isn’t quite so glamorous.
For more on Snap, check out The Final Round, starting at 3:55 p.m. ET. We will have the earnings for you live.