Snap Unveils $2,195 AR Glasses, Shares Drop 10%

Author: June, DeepChain TechFlow

On June 16, Snap CEO Evan Spiegel officially launched AR glasses called Specs at the Augmented Reality World Expo, priced at $2,195.

On the day of the announcement, SNAP's stock price plunged nearly 10%, closing at $5.16.

Soon, a popular post appeared on Reddit’s well-known retail investor community r/wallstreetbets:

The poster called the CEO a "brain-dead idiot," compared the company to a "capital furnace," and even begged others to post images of massive losses so he could sleep peacefully.

He voiced the most direct question on behalf of the entire market: How can a company that has been losing money year after year bet its turnaround on a pair of glasses that young people simply can’t afford?

When it comes to Snapchat, friends in China might not be very familiar with it, but you’ve probably seen this once-popular "dog filter":

The virtual puppy with its tongue sticking out and ears swaying with its head movement was the most popular lens from Snapchat’s 2015 launch of Lenses (AR filters).

The real-time facial tracking technology behind it comes from Looksery, a Ukrainian startup that Snap acquired for approximately $1.5 billion. This remains the largest acquisition in Ukrainian tech history, and it was Snapchat that truly turned this technology into a global phenomenon, inspiring both celebrities and everyday users to emulate it.

To some extent, looking back at Snapchat’s history, it resembles a “history of being copied.”

The pioneering限时动态 (Stories) feature was nearly copied by Instagram and is now standard across nearly every social app; the camera-first interface and swipe-based navigation have been adopted industry-wide for nearly a decade; even its early bet on AR glasses has been beaten to market by Meta’s Ray-Ban smart glasses.

Snapchat has repeatedly stood at the forefront of technology but has never managed to turn its first-mover advantage into a commercial edge.

This can also be seen from its stock price.

Since its all-time high of $83.34 in September 2021, SNAP has plunged 94% over the past five years, starkly contrasting with the U.S. stock market, which has repeatedly hit new highs during the same period.

2021 marked the peak of the pandemic-driven windfall—but also the turning point. That same year, Apple tightened iOS privacy tracking permissions, severely undermining Snap’s core advertising targeting capabilities. In the years that followed, TikTok and Instagram surged ahead, while Snap, due to its persistently weak profitability, never regained its former stock price levels.

Return to the popular post mentioned at the beginning.

Why did Snap's stock price drop immediately after launching its new product, and why are these AR glasses being widely mocked across X and Reddit?

First, we must consider its core users: Snapchat’s primary audience is Gen Z, aged 18 to 24. Selling a pair of glasses priced as high as $2,195 to a group of young people who can barely afford them is clearly unrealistic.

Placing this dilemma within the context of industry peers makes it clearer.

Similarly engaged in content socializing, Meta generated $56.3 billion in quarterly revenue and nearly $27 billion in net profit; ByteDance and Xiaohongshu have also achieved profitability.

Snapchat is the only platform with growing users and rising revenue, yet it still posted a net loss of $89 million in the first quarter of 2026. Since its IPO in 2017, it has recorded an annual net loss every year. The reason is that younger users are not the most attractive demographic for advertisers; brands prefer to allocate their budgets toward consumers aged 25 to 45, who are the primary spending group.

Being young, however, has become a burden for Snap’s monetization.

Under these circumstances, Spiegel still chose to double down.

He called 2026 the company’s “crucible moment.” In April of this year, Snap laid off approximately 1,000 employees, or 16% of its workforce, citing that AI can now handle a large volume of repetitive tasks.

At the same time, the company has invested over $3.5 billion cumulatively in the Specs AR glasses production line. Since the first-generation Spectacles in early 2016, this high-stakes bet has lasted nearly a decade.

To see how far we've come in the past decade, we must return to the first-generation glasses.

Image: The original glasses from 2016

It was released in September and launched in November of that year—a striking pair of bright yellow glasses sold through street vending machines, with a camera embedded in the frame. Strictly speaking, it wasn’t truly AR; when worn, it only allowed you to record and share circular, hands-free short videos on Snapchat. In essence, it was more like a fun wearable gadget.

Figure: Specs launching in 2026

Ten years from now, Specs will overlay digital information onto real-world scenes, run AI functions, recognize gestures, and operate independently without a phone. This is a decade-long leap from “glasses that record video” to “a spatial computer worn on the face”—the very future Spiegel truly wanted to bet on.

Throughout the entire incident, what sparked the most outrage among investors was the widely considered outrageous pricing.

The question is, what did the extra money buy?

Compared to the Ray-Ban Display, which only has a small HUD tucked into the corner of the lenses for $799, Specs are true AR—they can overlay digital content onto the real world, recognize gestures, and operate independently without a phone, offering a significantly more advanced feature set.

But it weighs about 132 grams—nearly twice as much as the former—and offers only around four hours of battery life, while its flagship features—navigation, measurement, and AI queries—are already easily handled by smartphones. Paying $2,195 buys you a leap into a new product category, but not necessarily a mature product suited for everyday use. This may be the true source of investor unease.

When activist investor Irenic Capital publicly pressured the company to shut down or spin off the Specs division to preserve cash flow, Spiegel publicly rejected the proposal, insisting on keeping it as part of the company’s long-term model.

Laying off staff to cut costs while heavily investing in a vision that hasn’t yielded returns in a decade.

This is the most authentic portrayal of Snapchat today.

In 2015, Snapchat captivated the world with an AR effect resembling a virtual puppy; today, eleven years later, its heavy investment in AR glasses is met with little confidence.

However, not everyone treats it as a farce.

Some view it within the evolution of mobile phones: from bulky, brick-like early phones to today’s smartphones, this journey took over thirty years. Currently expensive and heavy AR glasses may simply be an awkward but necessary step on the path to maturity.

But in an era where short-term gains are widely pursued and opinions are blindly followed, is an entrepreneur like Spiegel, who consistently sticks to his convictions, a rare outlier in the industry—or a gambler destined to be eliminated by the market?

This question may be worth answering for each observer themselves.