Snap Swings To Profit As SPECS Set To Roll Out; Stock Takes A Hit

Snap‘s third quarter revenue jumped 14% year-on-year to $1.72 billion as income of $56 million swung from a net loss of $104 million, “reflecting the progress we are making to build a more profitable business,” said Evan Spiegel, co-founder and CEO.

Snapchat daily active users reached 495 million, up 4% from the year earlier and two million more than in the second quarter. Investors were not impressed by the Snapchat parents numbers, knocking the shares down by almost 10% in after-market trading. The share are often volatile after earnings.

“AI is becoming a significant advantage for our teams and advertising platform, and we continue to strengthen our business while investing in our long-term vision for augmented reality with the launch of SPECS,” said Speigel, referring the the company’s big new bet. There’s currently a SPECS First Look pop-up open in Los Angeles.

It unveiled the AR glasses with a tiny built-in computer in June. They’ve been available to pre-order for delivery in the U.S., U.K. and France this fall on the Specs website for $2,195 with a $200 refundable deposit.

Snap founder and CEO said the product represented over a decade of investment across the full augmented reality stack including developer tools, a proprietary operating system, displays, optics and computer vision, involving more than 7,000 patents.

Last month, Snap tapped Robert Downey Jr as Honorary Chief Customer Experience Officer for SPECS to boost awareness and create original content.

The company will be taking analysts’ questions on a call at 5 pm ET today.