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Snapchat loses 2M more users in Q3 as shares sink to new low – TechCrunch

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Snapchat continued to shrink in Q3 2018 but its business is steadily improving. Snapchat’s daily active user count dropped again, this time by 1 percent to 186 million, down from 188M and a negative 1.5 percent growth rate in Q2. User count is still up 5 percent year-over-year, though. Snapchat earned $298 million in revenue with an EPS loss of $0.12, beating Wall Street’s expectations of $283 million in revenue and EPS loss of $0.14, plus a loss of a half a million users.

Snap entered earnings with a $6.99 share price, close to its $6.46 all-time low and way down from its $24 IPO opening price. Snap lost $325 million this quarter compared to $353 million in Q2, so it’s making some progress with its cost cutting. That briefly emboldened Wall Street, which pushed the share price up 8.3 percent to around $7.57 right after earnings were announced.

But then Snap’s share price came crashing down to -9.3 percent to $6.31 in after-hours trading. The stock had been so heavily shorted by investors that it only needed modest growth in its business for shares to perk up, but the fear that Snap might shrink into nothing has investors weary. Projections that Snap will lose users again next quarter further scared off investors.

Worringly, Snapchat’s average revenue per user dropped 12.5 percent in the developing world this quarter. But strong gains in the US and Europe markets grew global ARPU by 14 percent. Snap projects $355 million to $380 million in holiday Q4 revenue, in line with analyst estimates.

In his prepared remarks, CEO Evan Spiegel admitted that “While we have incredible reach among our core demographic of 13- to 34-year-olds in the US and Europe, there are billions of people worldwide who do not yet use Snapchat.” He explained that the 2 million user loss was mostly on Android where Snapchat doesn’t run as well as on iOS. Noticibly absent was an update on monthly active users in the US and Canada. Snap said that was over 100 million monthly users last quarter, probably in an effort to distract from the daily user shrinkage. The company didn’t update that stat, but did say the “over 100 million” stat was still accurate.

Snap CEO Evan Spiegel

Spiegel had said in a memo that his stretch goal was break-even this year and full-year profitability in 2019. But CFO Tim Stone said that “Looking forward to 2019, our internal stretch output goal will be an acceleration of revenue growth and full year free cash flow and profitability. Bear in mind that an internal stretch goal is not a forecast, and it’s not guidance.”

During the call, Spiegel responded to questions about the Android overhaul’s schedule saying, “Quality takes time. We’re going wait until we get it right”. But analysts piled on with inquiries about how Snap would turn things around in 2019. He admitted Snaps created per day had dropped from 3.5 billion to 3 billion per day, but tried to reassure investors by saying over 60% of our users are still creating snaps every day.

Spiegel said that expanding beyond the 13 to 34-year-old age group in the US and Europe, plus scoring more users in the developing world via the improved Android app would be how it restores momentum. But the problem is that courting older users could sour the perception of its younger users who don’t want their parents, teachers, or bosses on the app.

Now down to $1.4 billion in cash and securities, Snap will need to start reaching more of those international users or improving monetization of those it still has to keep afloat without outside capital.

An Uphill Battle

Q3 saw Snapchat’s launch its first in-house augmented reality Snappable games, while plans for an third-party gaming platform leak.  The Snappable Tic-Tac-Toe game saw 80 million unique users, suggesting gaming could be the right direction for Snap to move towards.

It launched Lens Explorer to draw more attention to developer and creator-built augmented reality experiences, plus its Storyteller program to connect social media stars to brands to earn sponsorship money. It also shut down its Venmo-like Snapcash feature. But the biggest news came from its Q2 earnings report where it announced it’d lost 3 million users. That scored it a short-lived stock price pop, but competition and user shrinkage has pushed Snap’s shares to new lows.

Snapchat is depending on the Project Mushroom engineering overhaul of its Android app to speed up performance, and thereby accelerate user growth and retention. Snap neglected the developing world’s Android market for years as it focused on iPhone-toting US teens. Given Snapchat is all about quick videos, slow load times made it nearly unusable, especially in markets with slower network connections and older phones.

Looking at the competitive landscape, WhatsApp’s Snapchat Stories clone Status has grown to 450 million daily users while Instagram Stories has reached 400 million dailies — much of that coming in the developing world, thereby blocking Snap’s growth abroad as I predicted when Insta Stories launched.. Snap Map hasn’t become ubiquitous, Snap’s Original Shows still aren’t premium enough to drag in tons of new users, Discover is a clickbait-overloaded mess, and Instagram has already copied the best parts of its ephemeral messaging. Snap could be vulnerable in the developing world if WhatsApp similarly copies its disappearing chats.

At this rate, Snap will run out of money before it’s projected to become profitable in 2020 or 2021. That means the company will likely need to sell new shares in exchange for outside investment or get acquired to survive.

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No new Galaxy Note this year as Samsung’s foldables gain S Pen functionality – TechCrunch

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Samsung sent out invites for its August 11 Unpacked event last week. While it’s clear this is going to be packed (somewhat ironically) even by the company’s standards, the event may well be as notable for what it doesn’t include. Namely, a slew of rumors have pointed to Samsung skipping its annual Galaxy Note update.

In a blog post today, the company’s president and head of Mobile Communications Business, TM Roh, writes, “Instead of unveiling a new Galaxy Note this time around, we will further broaden beloved Note features to more Samsung Galaxy devices.” The language isn’t entirely clear what that means for the future of Samsung’s beloved – if occasional erratic – phablet. No Note this event? This year? This … ever?

Samsung offered TechCrunch the following clarification, “We will not be launching new Galaxy Note devices in 2021. Instead, Samsung plans to continue to expand the Note experience and bring many of its popular productivity and creativity features, including the S Pen, across our Galaxy ecosystem. We will share more details on our future portfolio once we are ready to announce.”

Early rumors chalked the lack of a new Note up to supply chain problems that have persisted throughout much of 2020 and 2021. But further speculation has left many wondering whether the company may finally be sunsetting the Galaxy Note series on the eve of its 10th anniversary. Is it possible that the pioneering phablet has run its course, especially as other Samsung flagships get larger and siphon off its biggest features?

What’s clear is that some of the devices announced on the 11th will follow in the footsteps of the Galaxy S21 and bring Note-like features including S-Pen functionality. Likely this means at least the Galaxy Z Fold, confirming earlier rumors that the foldable would be the latest Galaxy device to blur the line between it and the Note. Presumably this also means a further reinforced display for the product. Recent leaks point to a carrying case with a pen holster, rather than baking the slot directly into the Fold’s already complicated design.

“I hope you’ll join us as we debut our next Galaxy Z family and share some foldable surprises — including the first-ever S Pen designed specifically for foldable phones,” Roh writes. The executive also promises “even more refined style, armed with more durable, stronger material” on the new Galaxy Z Flip, while also confirming the arrival of a new Z Fold.

Rounding out the news is a reference to the One UI Watch that appears to confirm that the latest Galaxy Watch will also make a cameo at the upcoming Unpacked.

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Samsung will announce new foldables on August 11 – TechCrunch

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Samsung just sent out invites for its next Unpacked event. There are those companies that like to sneak hints into their invites — and then there’s Samsung. The note leads with the big, bold words “Get ready to unfold” and features a pair of flat-colored objects that can reasonably be said to resemble the form factors of the Galaxy Z Fold and Flip, respectively.

In keeping with…the general state of the world over the past year-and-a-half, the event will be held virtually on Wednesday, August 11. Interestingly, the company is also opening up preorders on its “next flagship,” sights and specs unseen. Perks for early preorders include “12 free months of Samsung Care+, up to an extra $200 trade-in credit and a special pre-order offer.”

But honestly, it’s generally best to wait until you actually see the thing and maybe even read a review or two.

There’s a lot to unpack (so to speak) ahead of the event. First, I’m probably not alone in expecting that the company would focus its next big event on the upcoming Galaxy Watch. The big event at MWC was a bit of a dud (not unlike MWC itself), offering up more information on the upcoming wearable partnership with Google, in lieu of announcing any hardware.

As the company noted at the time, “The upcoming One UI Watch will debut at an upcoming Unpacked event later this summer, sporting the new UI, as well as the forthcoming joint Samsung/Google platform.”

It seems reasonably likely that this will be the event where that will occur, even if the new watch doesn’t get top billing. For one thing we’re running out of summer. For another, rumors have the new Galaxy Watch set for a late-August (the 27th) release.

All told, this could well be a pretty huge summer event for the company, bucking last year’s trend of meting out devices one by one at virtual invents. Word on the street is we could be seeing a Galaxy Watch 4, Galaxy Z Fold 3, Galaxy Z Flip 3, Galaxy S21 FE (“Fan Edition” — basically the latest version of the company’s budget flagship) and even the Galaxy Buds Pro, which will more directly take on the AirPods Pro (which are getting a bit long in the tooth).

What’s missing in all of this? No points if you said the Note. Samsung’s well-loved phablet is reportedly not coming this year, as chip shortages continue to plague the industry. That would be a big hit to Samsung’s six-month cycle, though we’ll see how that all plays out soon enough.

The August 11th event kicks off at 10AM ET / 7AM PT.

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Kdan Mobile gets $16M Series B for its cloud-based content and productivity tools – TechCrunch

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Kdan Mobile founder and CEO Kenny Su. Image Credits: Kdan Mobile

Kdan Mobile, a company that provides a wide range of cloud-based software, including AI-based tech for organizing documents, has raised a $16 million Series B. The round was led by South Korea-based Dattoz Partners, which will also take a seat on Kdan Mobile, and included participation from WI Harper Group, Taiwania Capital and Golden Asia Fund Mitsubishi UFJ Capital.

Launched in 2009, Kdan Mobile has focused on developing content creation and productivity software for mobile devices from the start, founder and chief executive officer Kenny Su told TechCrunch. “We’ve observed more and more industries embracing remote or hybrid work for years now, even before 2020,” he said. “We always sensed that trend would continue.”

Kdan Mobile has now raised $21 million in total. Since announcing its Series A in April 2018, Kdan Mobile has grown from 70 employees to 200 in Taiwan, China, Japan and the United States. It also passed 200 million downloads and now has more than 100 million members on its platform. More than half of Kdan Mobile’s users are in the U.S. and Europe, 30% from Asia and 15% from Africa and Australia.

Part of the funding will be used to develop Kdan Mobile’s enterprise products, including Document AI, its data processing and filtering technology, and SaaS products like e-signature service DottedSign, PDF software Document 365 and Creativity 365 for multimedia content creation, including animations and video editing.

After focusing primarily on individual users, Kdan Mobile decided to start working with more enterprise clients in 2018 and its software is now used by more than 40,000 businesses and educational organizations. Su said the company’s focus on enterprise was validated with the 2019 launch of DottedSign, which now has more than 300,000 users. During the past year and a half, the number of signatures processed by DottedSign increase by 30 times as companies switched to remote work because of the pandemic. Kdan Mobile also began offering a set of APIs and SDKs so internal developers at large enterprises can integrate and customize its technology.

“We use a lot of what’s called B2C2B approach, or business to consumer to business, meaning that we still try to connect with users at the individual level, but do so in a way that we hope they’ll adopt our solutions at the company level,” said Su.

Document AI was launched in 2021 after Kdan Mobile found that many of its users wanted to reduce the amount of time they spend managing documents. Its features include optical character recognition, smart tagging and search, and protection for sensitive data. Some examples of how Document AI can be used include automating data-entry tasks and creating summaries of research documents.

When asked how its products differentiate from those offered by Google, Microsoft and Adobe, Su said one way is that Kdan Mobile has always created products for mobile first, before designing the user experience for other devices, with the idea of serving professionals who are on the move a lot.

On the other hand, Kdan Mobile doesn’t necessarily see itself as a competitor with those companies. Instead, its solutions are complementary. For example, it creates files that are compatible with Adobe products and is integrated with Google Workspace, Zapier and, in the near future, Microsoft Teams.

“In that regard, it’s about helping users where they are, rather than trying to sway them away from existing products or services,” Su said.

In statement, Dattoz Partner CEO Yeon Su Kim said, “We see tremendous growth in the market for software and solutions that empower the post-pandemic hybrid workforce. Kdan’s powerful product suite and the leadership team’s ability to executive have led to its strong momentum in several key markets, including the U.S. and Asia markets.”

 

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