Does Anyone Still Pay for Snapchat's Premium Subscription?

Another fairly recent subscription I've been keeping an eye on is Snapchat+, which I called a paid beta when it first launched last July.

The launch surprised me, and with nearly $6M in net revenue from the App Store, I was surprised by how much people are willing to spend to beta test an app. Retention wasn't amazing in month two, which aligns with what I thought - people were curious and the subscription cost wasn't high enough to prevent them from trying it out.

But growth since has been pretty healthy that it's safe to say it's working.

Let's look at the numbers.

Snapchat's month two of revenue, which I take as a better starting point to measure growth because it doesn't include the hype, totaled $4.4M from the App Store, according to our revenue estimates. And that's net, meaning what Snap gets to keep after Apple takes its share.

It's been on the rise since.

Snapchat+ earned $5.6M of net revenue from the App Store by the end of 2022, a 27% increase from August. Since December, net revenue rose another 21%, ending February with $6.8M, according to our estimates.

I expect revenue to continue at this rate for much of 2023, making Snapchat+ a decent revenue stream for Snap. It won't compete with its ad revenue, which rose to $4.6B in 2022, but still has a lot of room for growth. Especially if it can become more useful.

Snapchat+ and Twitter Blue are very similar in that they go after a user base that isn't used to paying, don't offer too much that's exciting, but are growing at a healthy pace. The only missing ingredient here is better features and that growth can 10x overnight. They have the users.