Snap, the parent company of the popular social media app Snapchat, is closing down its enterprise services division after less than a year. The company reportedly laid off 170 employees as part of the shutdown.
The enterprise services division was launched in January 2023 and was tasked with developing augmented reality (AR) products and services for businesses. However, the division reportedly failed to gain traction with customers.
In a memo to employees, Snap CEO Evan Spiegel said that the company was "winding down" the enterprise services division in order to "focus on our core products and services."
"We've learned a lot from our work in enterprise, and we're grateful to the team for their contributions," Spiegel said. "However, we believe that the best way to serve our long-term customers is to focus on our core products and services."
The closure of the enterprise services division is a setback for Snap, which has been struggling to grow its user base in recent years. The company is also facing increasing competition from TikTok, which is now the most popular social media app among Gen Z users.
It remains to be seen how the closure of the enterprise services division will impact Snap's bottom line. However, the move is likely to raise concerns about the company's long-term prospects.
The closure of Snap's enterprise services division is a significant development for the company. It is a sign that Snap is struggling to find new ways to grow its business, and it is also a sign that the company is facing increasing competition from TikTok.
It remains to be seen how the closure of the enterprise services division will impact Snap's bottom line. However, it is likely to put pressure on the company to grow its user base and increase its revenue from advertising.
Snap's closure of its enterprise services division is a setback for the company, but it is also an opportunity for Snap to focus on its core products and services. The company needs to find ways to grow its user base and increase its revenue from advertising in order to remain competitive in the social media market.