It's been a bad couple of weeks for Snapchat. After reports of layoffs on Friday, CEO Evan Spiegel announced the milestone of 150,000 Snapchat Spectacles sold, way over the target of 100,000.
However, the release of that number spurred some investigation from The Information. It turns out Snap Inc. ordered more of the glasses after initial demand, meaning there are hundreds of thousands still sitting in Chinese warehouses.
For the unfamiliar, Spectacles allow the user to capture and share PoV images and video straight from a pair of glasses. They offer up to 100 snaps from one charge, and a case that can hold up to dour charges.
Snapchat initially sold the glasses only through a single vending machine in LA, the lack of supply driving demand. It then traveled across the U.S. to erect it elsewhere, before selling internationally via its website.
Playing the Long Game
The demand is now faltering, which is unsurprising given the $130 price tag. For the company's first venture into hardware, it's not great news, especially considering its recent philosophy. However, not all is lost. As well as sales through its website, Snap Inc. may be able to repurpose some of the hardware and materials for upgraded versions.
It's also worth noting that Snapchat never had plans to dominate the market so early. Speaking earlier this week, Spiegel said, “Our view is that hardware is going to be an important vehicle for delivering our customer experience maybe in a decade. But if we believe it's going to be important in a decade, we don't want to be starting a decade from now.”
Still, with advertising growth failing to meet expectations and a bid for drone maker Zero-Zero falling through, it's definitely been a trying few months. Snap is trading below its IPO price by quite a margin, and its hard to say when its next hardware venture will be.