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Snapchat found more friends and sex video compilationmade some money -- but far far fewer and far less than analysts had hoped. It's not good.

How bad? Really bad. Snapchat shares dropped 25 percent after the earnings were first released.

The biggest concern is with user growth. Snapchat needs to get bigger in hopes of one day becoming a platform big enough to command major ad buys. It's now at 166 million daily active users, but that's only 5 million more than it had when it filed to go public. Expectations were for more.

What's the explanation? Well, Snapchat gave none in writing. Earnings releases usually come with some text explaining what happened and where the company is going. Snap decided to skip that part, as analyst Jan Dawson noted.

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But the company has a call scheduled with analysts and investors 30 minutes after the earnings report was released.

Snapchat remains far smaller than rival Facebook, which has more than 1 billion daily active users and nearly 2 billion monthly active users. It's also far below Instagram's more than 400 million daily active users, 200 million of whom watch Instagram Stories, its copycat version of one of Snapchat's core products.

In case you didn't realize it, Snapchat does make some money, primarily via advertising and by selling video-camera sunglasses. Snapchat brought in $149.6 million from January to March.

But Snapchat was expected to bring in $158 million, according to analysts polled by Thomson Reuters. That's a good bump up from the $38.8 million Snap pulled in a year prior, but again, it's a far cry from what analysts had expected.

Meanwhile, the company is spending way, way more than it's bringing in.

Snapchat isn't even close to being profitable. It lost $2.2 billion over the quarter. One of the biggest costs it has, according to its S-1 filing, is Google Cloud services, and it also gives out a lot, a whole lot, of stock option grants.

For the stock price, Snap's shares were priced at $17 but when it began trading on the New York Stock Exchange in March it increased to $24. The price spiked at more than $29 and closed on Wednesday at $22 but plummeted by more than 20 percent in after-hours trading on the NASDAQ.

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