Snap shares tumble after it reports widening losses

Snap, the owner of messaging app Snapchat, has reported a second-quarter loss of $443m (£341m), up significantly from the $116m loss it posted in the same period of last year.

The technology firm said its revenues in April to June period increased by over 150% to $182m, but this fell short of analyst expectations.

Expenses ballooned by more than three-fold compared to a year earlier to $631m, including $242m in stock-based payments and related tax expenses.

Snapchat's number of daily active users rose by 7.3 million over the quarter to 173 million. This was again short of Wall Street expectations for the app to bring in 8 million new users.

The announcement sent shares of Snap 16% lower during after-hours trading in New York.

Investors have long been sceptical of Snap's long-term prospects and its ability to turn rising revenues to profits for shareholders amid intense competition from rivals such as Facebook.

Launched in 2012, Snap grew in popularity as an app that allows users to share pictures that delete themselves after being viewed.

Facebook owner Mark Zuckerburg made a $3bn cash offer for the app in 2013, but it was turned down by its founder, Evan Spiegel.

Snap began floating on the US stock market in March this year for an initial offer price of $17 a share. The stock closed 44% higher on its first day of trading, valuing the company at about $30bn.

The share price is now trading at under $14.

Snap chief executive officer Spiegel said neither he nor co-founder Bobby Murphy would sell shares in the company this year as a sign of confidence in its future.

"Given the amount of speculation around the lock-up expiration, I feel it is important to note that Bobby and I will not sell any of our shares this year," he was quoted as saying by Reuters during a call with analysts.

"We believe deeply in the long-term success of Snap."