Snap Inc. Shuts Down AR Division After Short-lived Run

Snap Inc (NYSE: SNAP) is closing its augmented reality enterprise services (ARES) division, just months after its launch in March.

The decision comes as the company, known for its photo messaging app Snapchat, grapples with the economic challenges exacerbated by weak advertising spending from businesses affected by inflation.

The shutdown of ARES will result in approximately 170 job cuts, according to the company. Snap initiated the division in March with the aim of diversifying its revenue streams beyond its heavily ad-dependent model. However, the endeavor faced challenges and failed to gain traction in the market.

“It would take significant incremental investment to grow our enterprise offering for retailers and we simply cannot make that investment at this time,” CEO Evan Spiegel wrote in a note to employees. He said that the company had to instead redirect its resources to the core advertising business.

Read: Snap Plummets Following Disappointing Forecast

This move follows Snap’s broader efforts to streamline its operations, including a 20% reduction in staff, restructuring of the advertising sales unit, and discontinuation of certain projects, such as mobile games, as part of a focused strategy to enhance sales.


Information for this story was found via Reuters, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

200 Grams of Gold And 21% Copper — That’s Not Normal | Matt Wilson – Sterling Metals

Silver at $100? This Time It Might Stay There. | David Morgan

Critical Minerals Are Rerating! | John Passalacqua – First Phosphate

Recommended

Steadright Enters MOU To Acquire Historic Goundafa Polymetallic Mine In Morocco

Military Seizes Power in Madagascar After President Flees

Related News

Apple Makes Bold Entry into Augmented Reality Market with Vision Pro Headset

In a significant hardware launch event— the first in nearly a decade, Apple Inc. (NASDAQ:...

Tuesday, June 6, 2023, 07:30:00 AM

Snap Falls 25% Following Q3 2022 Results: US$1.13 Billion In Revenue, US$359.5 Million Net Loss

After an onslaught of challenges, Snap Inc. (NYSE: SNAP) was able to squeeze out relatively...

Friday, October 21, 2022, 08:25:04 AM

Snapchat Plans To Add A “Plus” Subscription Service Amid Below Guidance Outlook

Weeks after Snap Inc. (NYSE: SNAP) announced its expected revenue and adjusted EBITDA guidance miss,...

Monday, June 20, 2022, 03:01:00 PM

Snap Shares Snap By 30% Following Q4 2023 Financials

Snap Inc. (NYSE: SNAP), the parent company of popular social media platform Snapchat, faced a...

Wednesday, February 7, 2024, 09:12:41 AM

Canaccord: Headwinds To Begin To Pressure Snap Inc Stock

On Thursday Snap Inc (NYSE: SNAP) reported its first-quarter financial results. The firm reported revenues...

Tuesday, April 26, 2022, 11:28:00 AM