Snap closes AR department

Snap closes AR department

New York, September 29, 2023

Snap, the parent company of Snapchat, is closing its enterprise augmented reality (AR) services division.

The closure of the AR Enterprise Services (ARES) division, which launched in March, will result in around 170 layoffs, but some employees could be rehired for other roles.

Customers found the project too costly and complex, according to a memo from CEO Evan Spiegel.

The goal was to give business customers the opportunity to offer virtual try-on tools that use AR technology to overlay graphics over real photos and images.

However, mobile AR technology was “both technically complex and less appealing to our customers,” Spiegel wrote in the memo.

The company concluded that significant investments in building ARES were not sustainable.

The closure came after Snap reported its first revenue decline as a public company in the first quarter and a 4% year-over-year decline in revenue in the second quarter.

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