Evan Spiegel invested roughly $3 billion to develop Spectacles, augmented reality glasses intended as a core growth driver for Snap. Spectacles have not reached mainstream adoption, prompting consideration of outside funding and even a potential spin-off despite deep integration with Snapchat's AR features. Gen Alpha engagement has declined due to stricter school phone policies and lower smartphone use among younger children, and several key executives have departed. Snap's stock fell from over $83 in 2021 to around $7, and recent earnings disappointed while rivals report double-digit ad revenue growth. Snapchat added creator tools and revenue sharing, but private messaging limits ad inventory.
Snap (SNAP) CEO Evan Spiegel has spent around $3 billion developing Spectacles, which are the social media company's augmented reality glasses. Indeed, he believes that they are an essential part of Snap's future. However, despite this massive investment, Spectacles have yet to find mainstream success. Now, Snap is considering raising outside funding to help the product better compete with rivals like tech giant Meta (META), according to The Information.
In fact, executives are concerned that Gen Alpha (kids born after 2010) are using Snapchat less than previous generations, partly due to stricter phone policies at schools and lower smartphone use among younger kids. Adding to the pressure, some key executives have recently left the company. As a result, Snap's stock has fallen sharply, from over $83 in 2021 to around $7, and recent earnings results have disappointed.
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