Snap Inc. (NYSE: SNAP), which bills itself as a camera company, notwithstanding that it’s best known for its Snapchat app, announced Wednesday the second new version of its camera-equipped Spectacles in four months. The company released version 2 of Spectacles in late April, eliminating the tell-tale yellow ring around the camera lens and making other improvements to version 1, which sold so poorly that Snap ended up taking a $40 million write-off for unsold inventory of the $130 Spectacles.
The new version of Spectacles is mostly a version 2.1, with the main difference being a different, more rectangular (and hipper) lens shape. Lenses on the new version are polarized and come with a new, softer case. Version 2.1 Spectacles sell for $200, an increase of $50 from the version 2 price of $150, and go on sale today in some markets, including the United States and Europe.
On Tuesday, Snap shares posted a new 52-week low of $10.43, and that has dropped even lower Wednesday, reaching a bottom of $10.06, the lowest intraday stock price since IPO in March of 2017.
Today’s share price decline may be due partly to a sharp drop in tech stocks generally at the same time that executives from Facebook and Twitter face a Senate committee. Regardless, the introduction of version 2.1 is not having a salutary effect on Snap’s stock price Wednesday.
Are Snapchat users going to buy the new Spectacles? They haven’t been buying version 2 in vast quantities yet, and $199 is a lot for Snap’s young crowd to cough up (or persuade their parents to cough up) for a pair of camera glasses. As TechCrunch pointedly notes, despite Snap’s ambitions to be a hardware company, it is fundamentally a software company with a narrow and shallow moat.
Shares traded down 4.3% in the late morning Wednesday at $10.15. The 52-week high is $21.22, and the consensus price target on the stock is $11.80. Snap’s market cap remains above $13 billion, though, and that’s not nothing.