Snap Stock Drops After Unveiling Expensive AR Glasses

Snap's long-awaited AR glasses, Specs, did not have the best debut. The company's stock has dropped 30% over the past year. Following Specs' launch, it sank more than 5% — falling from $5.86 a share on Tuesday to a low of $4.83 on Wednesday morning. As of this writing, the stock still hasn't recovered the position it held prior to the announcement.

The big concern surrounding Snap's new smart glasses — which the company has been working on for over a decade — is the cost: The company maintains they will retail at nearly $2,200 apiece. It's worthy of note that Snap's core user demographic — teenagers — are not typically equipped with that kind of pocket change, leading onlookers to question the profitability path for the new product.

Snap's CEO, Evan Spiegel, did an interview with CNBC on Tuesday (during which he sported the new glasses) and, when questioned about the hefty price, responded: “The most important way to think of Specs is as a computer, and so they’re comparably priced to other high-end computers or high-end laptops.” Spiegel further justified the cost by saying that Specs occupies a unique space in the AR market between glasses like Meta’s Ray-Bans — which cost a lot less but provide significantly less compute power — and bulkier headsets like the Apple Vision Pro, which are powerful but very expensive. Spiegel said his product was both “highly wearable but also incredibly capable for immersive computing.”