Snap Inc. has surpassed 3 million paying subscribers for its Snapchat+ service, a $3.99-a-month offering that grants early access to exclusive features, including the popular My AI chatbot powered by OpenAI’s GPT technology. The company revealed the milestone at its annual partner summit in Santa Monica, California, citing a surge in subscriber growth, with about 1 million new paying users joining in the past 11 weeks alone.
The subscription service, which launched in 2022, received a significant boost earlier this year when Snap added My AI to the offerings, increasing the appeal of the platform. “We never expected that we could grow to 3 million subscribers,” said Snap CEO Evan Spiegel in an interview. “What we essentially see is that when we release new features, that gets more people excited about signing up or trying Snapchat+. We definitely saw some nice momentum with My AI.”
While Snapchat+ remains a relatively small segment of Snap’s overall business, the company is hopeful about its future. Spiegel mentioned that his “medium-term goal” is for the service to reach 10 million subscribers, signaling the company’s ambitious push to monetize its user base amid a challenging social media landscape.
In addition to the AI-powered features, Snapchat+ offers users the ability to customize the app’s interface. The service is also available through Verizon Communications’ +play platform, further expanding its reach.
Snap, like many of its social media peers, has faced a slowdown in ad revenue growth. The company’s overall sales growth stagnated towards the end of 2022, and a decline in revenue is projected for the first half of 2023. In response, Snap has made efforts to trim its workforce and focus on higher-priority projects, such as user growth, revenue generation, and augmented reality technology.
Despite its recent success, Snapchat+ remains a small fraction of Snap’s overall business. With its $4-per-month price tag, 3 million subscribers would generate just under $150 million in annual revenue, which is modest compared to the company’s $4.6 billion total revenue in 2022 and its 750 million users.
Looking ahead, Snap is exploring new ways for users to generate income through the app. The company recently opened up the ability for users aged 18 and older to post public Stories, making it easier for creators to gain followers and grow their presence. To incentivize this new wave of creators, Snap announced plans to share a portion of advertising revenue with select users whose Stories are featured with ads in between posts.
With these strategies in place, Snap aims to further cement its position in the competitive social media space, proving that even amidst a challenging environment, innovation and monetization through subscription services can fuel growth
