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Shares in Snapchat's parent firm fell 17% after it revealed the app's controversial redesign had made it less attractive to would-be users.
Only four million new users were added in the opening three months of 2018 - just over half the number forecast.
And Snap has warned growth and revenue could slow substantially in the second quarter.
That is because the number of daily active users on Snapchat is crucial for generating advertising revenue.
The data was revealed in the firm's first results since January's overhaul of the messaging app.
Revenue jumped by more than half to $230.7m (£169.4m) in the first quarter, but also came in below analysts' expectations.
Snap blamed the redesign for "disrupting user behaviour" and creating some "apprehension" among its advertisers.
A tweet from Kylie Jenner wiped £1bn off Snap's stock market value after she said she wouldn't use it any longer
The results mark a major reversal of fortunes for the parent company after Snapchat added 8.9m new users late last year.
That quarterly jump in growth was the largest since Snap went public in March 2017.
The new look design was meant to attract more new users, but many of Snapchat's fans didn't like it.
Celebrities publicly criticised the redesign and a tweet from Kylie Jenner wiped £1bn ($1.35bn) off Snap's stock market value after she said she wouldn't use Snapchat any longer.
Many people complained that feeds were confusing and not chronological.
Snap made the changes as a way for the social network to monetise its service by mixing in more adverts.
Sticking with the plan
The firm has acknowledged that the new design hurt its results, but said the changes would drive growth in the long run.
"The redesign lays the foundation for the future of both our communication products and our media platform, and we look forward to doubling down on both," chief executive Evan Spiegel said on a conference call with analysts.
Snap insisted it would stick with the plan to keep content from friends separate from other publishers.
And it seemed to brush aside concerns over any long term impact on its earnings, adding that "a change this big" comes with "some disruption."
