Daily Active Users increased 18% year-over-year
to 249 million
Revenue increased 52% year-over-year to $679
million
Operating cash flow improved 28% year-over-year
to $(55) million
Snap Inc. (NYSE: SNAP) today announced financial results for the
quarter ended September 30, 2020.
Financial Highlights
- Operating cash flow improved by $21 million to $(55) million in
Q3 2020, compared to the prior year.
- Free Cash Flow improved by $15 million to $(70) million in Q3
2020, compared to the prior year.
- Common shares outstanding plus shares underlying stock-based
awards totaled 1,624 million at September 30, 2020, compared to
1,565 million one year ago.
- Revenue increased 52% to $679 million in Q3 2020, compared to
the prior year.
- Net loss was $(200) million in Q3 2020, compared to $(227)
million in the prior year.
- Adjusted EBITDA was $56 million in Q3 2020, compared to $(42)
million in the prior year.
“Our focus on delivering value for our community and advertising
partners is yielding positive results during this challenging time.
We’re excited about the growth of our business in Q3 as we continue
to make long-term investments in our future,” said Evan Spiegel,
CEO. “The adoption of augmented reality is happening faster than we
had previously anticipated, and we are working together as a team
to execute on the many opportunities in front of us.”
Three Months Ended
September 30,
Percent
Nine Months Ended
September 30,
Percent
2020
2019
Change
2020
2019
Change
(Unaudited)
(in thousands, except per
share amounts)
Cash used in operating activities
$
(54,828
)
$
(76,149
)
(28
)%
$
(115,099
)
$
(238,116
)
(52
)%
Free Cash Flow
$
(69,555
)
$
(84,087
)
17
%
$
(156,484
)
$
(265,501
)
41
%
Common shares outstanding plus shares
underlying stock-based awards
1,623,630
1,565,208
4
%
1,623,630
1,565,208
4
%
Operating loss
$
(167,864
)
$
(228,853
)
(27
)%
$
(764,836
)
$
(849,732
)
(10
)%
Revenue
$
678,668
$
446,199
52
%
$
1,595,304
$
1,154,646
38
%
Net loss
$
(199,853
)
$
(227,375
)
(12
)%
$
(831,740
)
$
(792,956
)
5
%
Adjusted EBITDA
$
56,361
$
(42,375
)
233
%
$
(120,446
)
$
(244,537
)
51
%
Diluted net loss per share attributable to
common stockholders
$
(0.14
)
$
(0.16
)
(16
)%
$
(0.58
)
$
(0.58
)
(1
)%
Non-GAAP diluted net income (loss) per
share
$
0.01
$
(0.04
)
120
%
$
(0.16
)
$
(0.20
)
(20
)%
Q3 2020 Summary & Key Highlights
Daily Active Users grew by 18% year-over-year and we saw
increased engagement across key metrics:
- DAUs were 249 million in Q3 2020, an increase of 39 million or
18% year-over-year.
- DAUs increased sequentially and year-over-year on each of iOS
and Android platforms.
- The average number of Snaps created every day grew 25%
year-over-year.
We continue to invest in our Discover platform as a
destination for content that entertains and informs:
- Total daily time spent by Snapchatters watching Shows increased
by over 50% year-over-year in Q3 2020.
- The daily average number of Snapchatters in India watching
Discover content increased by nearly 50% sequentially in Q3
2020.
- More than 40% of the US Gen Z population watched sports
Discover content on Snapchat last month.
- SportsCenter viewership on Snapchat increased by 80% from July
to September.
- We launched a new unscripted series called “The Solution
Committee” in which Jaden Smith seeks out the help of young
activists and celebrity friends to explore racial and social
justice issues.
- Our “VS The World” docuseries franchise launched its second
season, featuring Conor McGregor, and reached over 14 million
viewers.
- We launched a new unscripted series called “Coach Kev” in which
Kevin Hart inspires Snapchatters to live their best lives through
bursts of inspiration, positivity, and wisdom.
We continue to invest in our camera and augmented reality
platforms:
- As of the end of Q3 2020, over 1.5 million Lenses have been
created by our community through Lens Studio.
- The ‘Raise Your Voice’ Lens generated over 70 million
impressions and over 48,000 hours of playtime, demonstrating the
power of AR as a format in honoring the legacy of important
movements, such as the March on Washington in 1963.
- Our ‘Anime Style’ Lens powered by real time machine learning
was engaged with 3 billion times in its first week.
- We added 2D body tracking technology in Lens Studio, allowing
Lens creators to make AR experiences for the full human body.
- We released Lens Favorites, a new feature that allows
Snapchatters to pin their favorite Lenses for future use, to our
Android users.
- We launched our first Local Lens experience called City
Painter, allowing Snapchatters to virtually paint the shared
digital space on Carnaby Street in London.
We strengthened our ad platform and products while engaging
with advertisers:
- We partnered with Champs Sports, Clearly, Essie, Hoka One One,
Kohl’s, Levi’s, Jordan Brand, and Sally Hansen to launch augmented
reality-powered virtual try-on experiences.
- We launched ‘Meet the Snapchat Generation,’ our first-ever
global business-to-business marketing campaign highlighting
Snapchat’s unique audience.
- We launched Platform Burst, which allows advertisers to
purchase ad inventory across different formats to reach a
significant portion of their target audience over a few days.
- We launched a Snap Select gaming bundle, which is the first
commercial bundle tailored to a specific category and has led to
impactful partnerships with advertisers.
We continue to innovate to better serve our large and engaged
community:
- We introduced Creator Profiles to our community, providing
Creators with a permanent profile to host their photo, video, and
Lenses content, Story replies, and data analytics insights.
- We launched Sounds on Snapchat, empowering Snapchatters to
express themselves by adding licensed music from emerging and
established artists to their Snaps, including music companies like
Warner Music Group, Universal Music Publishing, The NMPA, and
Merlin.
- We helped over 1 million Snapchatters with voter registration
for the upcoming 2020 U.S. General Election through our ‘Register
to Vote’ Mini, developed in partnership with Democracy Works.
- Our Bitmoji team launched its first-ever branded customizable
Mix and Match collection, in partnership with Ralph Lauren, and
millions of users globally have dressed their Bitmoji in Ralph
Lauren since launch.
- Snapchatters can now dress their Bitmoji avatars in a new
collection of 19 different digital apparel and sneakers from Nike’s
Jordan brand, including the new Air Jordan XXXV.
- Our Headspace Mini, developed in partnership with Headspace,
was used by 5 million users in its first month after launch and we
released two new meditations in honor of World Mental Health
Day.
Financial Guidance
Given the uncertainties related to the ongoing COVID-19 pandemic
and the rapidly shifting macro conditions, we are not providing
revenue or Adjusted EBITDA guidance for the fourth quarter of
2020.
Conference Call Information
Snap Inc. will host a conference call to discuss the results at
2:00 p.m. Pacific / 5:00 p.m. Eastern today. The live audio webcast
along with supplemental information will be accessible at
investor.snap.com. A recording of the webcast will also be
available following the conference call.
Snap Inc. uses the investor.snap.com and snap.com/news websites
as means of disclosing material non-public information and for
complying with its disclosure obligation under Regulation FD.
Definitions
Free Cash Flow is defined as net cash provided by (used in)
operating activities, reduced by purchases of property and
equipment.
Common shares outstanding plus shares underlying stock-based
awards includes common shares outstanding, restricted stock units,
restricted stock awards, and outstanding stock options.
Adjusted EBITDA is defined as net income (loss), excluding
interest income; interest expense; other income (expense) net;
income tax benefit (expense); depreciation and amortization;
stock-based compensation expense and related payroll tax expense;
and certain other non-cash or non-recurring items impacting net
income (loss) from time to time.
A Daily Active User (DAU) is defined as a registered Snapchat
user who opens the Snapchat application at least once during a
defined 24-hour period. We calculate average DAUs for a particular
quarter by adding the number of DAUs on each day of that quarter
and dividing that sum by the number of days in that quarter.
Average revenue per user (ARPU) is defined as quarterly revenue
divided by the average DAUs.
A Monthly Active User (MAU) is defined as a registered Snapchat
user who opens the Snapchat application at least once during the
30-day period ending on the calendar month-end. We calculate
average Monthly Active Users for a particular quarter by
calculating the average of the MAUs as of each calendar month-end
in that quarter.
Addressable reach is defined as the approximate number of
Snapchat users that an ad could reach over a 28-day period in a
given locality. When we calculate the percentage of a demographic
group that can be reached, we do so by dividing addressable reach
by relevant census figures. Addressable reach and age data are
subject to limitations. For more information, see Snap’s SEC
filings and businesshelp.snapchat.com.
Note: For adjustments and additional information regarding the
non-GAAP financial measures and other items discussed, please see
“Non-GAAP Financial Measures,” “Reconciliation of GAAP to Non-GAAP
Financial Measures,” and “Supplemental Financial Information and
Business Metrics.”
About Snap Inc.
Snap Inc. is a camera company. We believe that reinventing the
camera represents our greatest opportunity to improve the way
people live and communicate. We contribute to human progress by
empowering people to express themselves, live in the moment, learn
about the world, and have fun together. For more information, visit
snap.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, or the Securities Act, and Section 21E of the Securities
Exchange Act of 1934, as amended, or the Exchange Act, about us and
our industry that involve substantial risks and uncertainties. All
statements other than statements of historical facts contained in
this press release, including statements regarding guidance, our
future results of operations or financial condition, business
strategy and plans, user growth and engagement, product
initiatives, and objectives of management for future operations,
and the impact of COVID-19 on our business and the economy as a
whole, are forward-looking statements. In some cases, you can
identify forward-looking statements because they contain words such
as “anticipate,” “believe,” “contemplate,” “continue,” “could,”
“estimate,” “expect,” “going to,” “intend,” “may,” “plan,”
“potential,” “predict,” “project,” “should,” “target,” “will,” or
“would” or the negative of these words or other similar terms or
expressions. We caution you that the foregoing may not include all
of the forward-looking statements made in this press release.
You should not rely on forward-looking statements as predictions
of future events. We have based the forward-looking statements
contained in this press release primarily on our current
expectations and projections about future events and trends,
including the ongoing COVID-19 pandemic that we believe may
continue to affect our business, financial condition, results of
operations, and prospects. These forward-looking statements are
subject to risks and uncertainties related to: our financial
performance; our lack of profitability to date; our ability to
generate and sustain positive cash flow; our ability to attract and
retain users, publishers, and advertisers; competition and new
market entrants; managing our international expansion and our
growth and future expenses; compliance with new laws, regulations,
and executive actions; our ability to maintain, protect, and
enhance our intellectual property; our ability to succeed in
existing and new market segments; our ability to attract and retain
qualified and key personnel; our ability to repay outstanding debt;
and future acquisitions or investments, as well as risks,
uncertainties, and other factors described in “Risk Factors” and
elsewhere in our most recent quarterly report on Form 10-Q for the
quarter ended June 30, 2020 filed with the SEC, which is available
on the SEC’s website at www.sec.gov. Additional information will be
made available in Snap Inc.’s quarterly report on Form 10-Q for the
quarter ended September 30, 2020 and other filings that we make
from time to time with the SEC. In addition, any forward-looking
statements contained in this press release are based on assumptions
that we believe to be reasonable as of this date. We undertake no
obligation to update any forward-looking statements to reflect
events or circumstances after the date of this press release or to
reflect new information or the occurrence of unanticipated events,
including future developments related to the COVID-19 pandemic,
except as required by law.
Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are
prepared and presented in accordance with GAAP, we use certain
non-GAAP financial measures, as described below, to understand and
evaluate our core operating performance. These non-GAAP financial
measures, which may be different than similarly titled measures
used by other companies, are presented to enhance investors’
overall understanding of our financial performance and should not
be considered a substitute for, or superior to, the financial
information prepared and presented in accordance with GAAP.
We use the non-GAAP financial measure of Free Cash Flow, which
is defined as net cash provided by (used in) operating activities,
reduced by purchases of property and equipment. We believe Free
Cash Flow is an important liquidity measure of the cash that is
available, after capital expenditures, for operational expenses and
investment in our business and is a key financial indicator used by
management. Additionally, we believe that Free Cash Flow is an
important measure since we use third-party infrastructure partners
to host our services and therefore we do not incur significant
capital expenditures to support revenue generating activities. Free
Cash Flow is useful to investors as a liquidity measure because it
measures our ability to generate or use cash. Once our business
needs and obligations are met, cash can be used to maintain a
strong balance sheet and invest in future growth.
We use the non-GAAP financial measure of Adjusted EBITDA, which
is defined as net income (loss); excluding interest income;
interest expense; other income (expense), net; income tax benefit
(expense); depreciation and amortization; stock-based compensation
expense and related payroll tax expense; and certain other non-cash
or non-recurring items impacting net income (loss) from time to
time. We believe that Adjusted EBITDA helps identify underlying
trends in our business that could otherwise be masked by the effect
of the expenses that we exclude in Adjusted EBITDA.
We use the non-GAAP financial measure of non-GAAP net loss,
which is defined as net income (loss); excluding amortization of
intangible assets; stock-based compensation expense and related
payroll tax expense; certain other non-cash or non-recurring items
impacting net income (loss) from time to time; and related income
tax adjustments. Non-GAAP net loss and weighted average diluted
shares are then used to calculate non-GAAP diluted net loss per
share. Similar to Adjusted EBITDA, we believe these measures help
identify underlying trends in our business that could otherwise be
masked by the effect of the expenses we exclude in the measure.
We believe that these non-GAAP financial measures provide useful
information about our financial performance, enhance the overall
understanding of our past performance and future prospects, and
allow for greater transparency with respect to key metrics used by
our management for financial and operational decision-making. We
are presenting these non-GAAP measures to assist investors in
seeing our financial performance through the eyes of management,
and because we believe that these measures provide an additional
tool for investors to use in comparing our core financial
performance over multiple periods with other companies in our
industry.
For a reconciliation of these non-GAAP financial measures to the
most directly comparable GAAP financial measure, please see
“Reconciliation of GAAP to Non-GAAP Financial Measures.”
Snap Inc., “Snapchat,” and our other registered and common law
trade names, trademarks, and service marks are the property of Snap
Inc. or our subsidiaries.
SNAP INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(in thousands, unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2020
2019
2020
2019
Cash flows from operating
activities
Net loss
$
(199,853
)
$
(227,375
)
$
(831,740
)
$
(792,956
)
Adjustments to reconcile net loss to net
cash used in operating
activities:
Depreciation and amortization
21,804
20,646
63,933
66,625
Stock-based compensation
192,080
161,228
550,300
519,358
Deferred income taxes
(1,186
)
170
(3,698
)
195
Gain on divestiture
—
—
—
(39,883
)
Amortization of debt discount and issuance
costs
24,503
6,412
56,478
6,412
Other
7,252
(1,245
)
15,369
(4,561
)
Change in operating assets and
liabilities, net of effect of acquisitions:
Accounts receivable, net of allowance
(151,856
)
(62,855
)
(43,310
)
(30,736
)
Prepaid expenses and other current
assets
(10,608
)
(490
)
(19,352
)
(4,980
)
Operating lease right-of-use assets
10,054
35,633
28,307
57,254
Other assets
3,390
2,139
2,343
4,540
Accounts payable
3,435
4,220
11,448
28,319
Accrued expenses and other current
liabilities
61,595
23,243
94,368
16,655
Operating lease liabilities
(15,760
)
(36,008
)
(40,739
)
(63,259
)
Other liabilities
322
(1,867
)
1,194
(1,099
)
Net cash used in operating activities
(54,828
)
(76,149
)
(115,099
)
(238,116
)
Cash flows from investing
activities
Purchases of property and equipment
(14,727
)
(7,938
)
(41,385
)
(27,385
)
Proceeds from divestiture, net
—
—
—
73,796
Non-marketable investments
(3,500
)
(1,050
)
(95,341
)
(3,750
)
Cash paid for acquisitions, net of cash
acquired
(33,508
)
—
(53,712
)
—
Purchases of marketable securities
(1,148,344
)
(1,115,358
)
(2,576,892
)
(1,924,398
)
Sales of marketable securities
155,899
24,948
373,857
102,437
Maturities of marketable securities
668,930
411,079
1,898,176
1,193,739
Other
—
—
(500
)
1,029
Net cash used in investing activities
(375,250
)
(688,319
)
(495,797
)
(584,532
)
Cash flows from financing
activities
Proceeds from issuance of convertible
notes, net of issuance costs
—
1,251,848
988,582
1,251,848
Purchase of capped calls
—
(102,086
)
(100,000
)
(102,086
)
Proceeds from the exercise of stock
options
2,434
7,788
26,041
14,726
Net cash provided by financing
activities
2,434
1,157,550
914,623
1,164,488
Change in cash, cash equivalents, and
restricted cash
(427,644
)
393,082
303,727
341,840
Cash, cash equivalents, and restricted
cash, beginning of period
1,252,631
337,732
521,260
388,974
Cash, cash equivalents, and restricted
cash, end of period
$
824,987
$
730,814
$
824,987
$
730,814
Supplemental disclosures
Cash paid for income taxes, net
$
1,309
$
643
$
2,679
$
564
Cash paid for interest
$
5,113
$
380
10,378
1,176
SNAP INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(in thousands, except per share
amounts, unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2020
2019
2020
2019
Revenue
$
678,668
$
446,199
$
1,595,304
$
1,154,646
Costs and expenses:
Cost of revenue
293,095
223,140
796,959
642,399
Research and development
283,639
211,599
783,115
663,983
Sales and marketing
143,511
123,240
397,834
332,626
General and administrative
126,287
117,073
382,232
365,370
Total costs and expenses
846,532
675,052
2,360,140
2,004,378
Operating loss
(167,864
)
(228,853
)
(764,836
)
(849,732
)
Interest income
2,801
10,317
16,158
25,579
Interest expense
(28,212
)
(8,654
)
(68,052
)
(10,219
)
Other income (expense), net
(5,669
)
(1,481
)
(14,483
)
41,477
Loss before income taxes
(198,944
)
(228,671
)
(831,213
)
(792,895
)
Income tax benefit (expense)
(909
)
1,296
(527
)
(61
)
Net loss
$
(199,853
)
$
(227,375
)
$
(831,740
)
$
(792,956
)
Net loss per share attributable to Class
A, Class B, and Class C common stockholders:
Basic
$
(0.14
)
$
(0.16
)
$
(0.58
)
$
(0.58
)
Diluted
$
(0.14
)
$
(0.16
)
$
(0.58
)
$
(0.58
)
Weighted average shares used in
computation of net loss per share:
Basic
1,466,420
1,393,358
1,446,040
1,364,327
Diluted
1,466,420
1,393,358
1,446,040
1,364,327
SNAP INC.
CONSOLIDATED BALANCE
SHEETS
(in thousands, except par
value)
September 30,
2020
December 31,
2019
(unaudited)
Assets
Current assets
Cash and cash equivalents
$
824,070
$
520,317
Marketable securities
1,900,935
1,592,488
Accounts receivable, net of allowance
529,872
492,194
Prepaid expenses and other current
assets
60,837
38,987
Total current assets
3,315,714
2,643,986
Property and equipment, net
175,199
173,667
Operating lease right-of-use assets
269,141
275,447
Intangible assets, net
91,796
92,121
Goodwill
816,113
761,153
Other assets
149,811
65,550
Total assets
$
4,817,774
$
4,011,924
Liabilities and Stockholders’
Equity
Current liabilities
Accounts payable
$
61,978
$
46,886
Operating lease liabilities
40,994
42,179
Accrued expenses and other current
liabilities
507,134
410,610
Total current liabilities
610,106
499,675
Convertible senior notes, net
1,650,246
891,776
Operating lease liabilities,
noncurrent
287,105
303,178
Other liabilities
71,546
57,382
Total liabilities
2,619,003
1,752,011
Commitments and contingencies
Stockholders’ equity
Class A non-voting common stock, $0.00001
par value. 3,000,000 shares authorized, 1,160,127 shares issued and
outstanding at December 31, 2019, and 3,000,000 shares authorized,
1,229,446 shares issued and outstanding at September 30, 2020.
12
12
Class B voting common stock, $0.00001 par
value. 700,000 shares authorized, 24,522 shares issued and
outstanding at December 31, 2019, and 700,000 shares authorized,
23,643 shares issued and outstanding at September 30, 2020.
—
—
Class C voting common stock, $0.00001 par
value. 260,888 shares authorized, 231,147 shares issued and
outstanding at December 31, 2019, and 260,888 shares authorized,
231,627 shares issued and outstanding at September 30, 2020.
2
2
Additional paid-in capital
9,968,707
9,205,256
Accumulated other comprehensive income
(loss)
8,499
573
Accumulated deficit
(7,778,449
)
(6,945,930
)
Total stockholders’ equity
2,198,771
2,259,913
Total liabilities and stockholders’
equity
$
4,817,774
$
4,011,924
SNAP INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES
(in thousands, unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2020
2019
2020
2019
Free Cash Flow reconciliation:
Net cash used in operating activities
$
(54,828
)
$
(76,149
)
$
(115,099
)
$
(238,116
)
Less:
Purchases of property and equipment
(14,727
)
(7,938
)
(41,385
)
(27,385
)
Free Cash Flow
$
(69,555
)
$
(84,087
)
$
(156,484
)
$
(265,501
)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2020
2019
2020
2019
Adjusted EBITDA reconciliation:
Net loss
$
(199,853
)
$
(227,375
)
$
(831,740
)
$
(792,956
)
Add (deduct):
Interest income
(2,801
)
(10,317
)
(16,158
)
(25,579
)
Interest expense
28,212
8,654
68,052
10,219
Other (income) expense, net
5,669
1,481
14,483
(41,477
)
Income tax (benefit) expense
909
(1,296
)
527
61
Depreciation and amortization
21,804
20,646
63,933
66,625
Stock-based compensation expense
192,080
161,228
550,300
519,358
Payroll tax expense related to stock-based
compensation
10,341
4,604
30,157
19,212
Adjusted EBITDA
$
56,361
$
(42,375
)
$
(120,446
)
$
(244,537
)
Total depreciation and amortization
expense by function:
Three Months Ended
September 30,
Nine Months Ended
September 30,
2020
2019
2020
2019
Depreciation and amortization expense:
Cost of revenue
$
5,615
$
4,580
$
16,672
$
16,368
Research and development
9,526
8,632
26,904
24,470
Sales and marketing
3,233
3,109
9,780
10,169
General and administrative
3,430
4,325
10,577
15,618
Total
$
21,804
$
20,646
$
63,933
$
66,625
Total stock-based compensation expense by
function:
Three Months Ended
September 30,
Nine Months Ended
September 30,
2020
2019
2020
2019
Stock-based compensation expense:
Cost of revenue
$
2,623
$
1,332
$
6,471
$
4,967
Research and development
132,003
108,176
377,836
353,028
Sales and marketing
27,393
23,333
79,306
67,567
General and administrative
30,061
28,387
86,687
93,796
Total
$
192,080
$
161,228
$
550,300
$
519,358
SNAP INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL MEASURES (continued)
(in thousands, except per share
amounts, unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2020
2019
2020
2019
Non-GAAP net income (loss)
reconciliation:
Net loss
$
(199,853
)
$
(227,375
)
$
(831,740
)
$
(792,956
)
Amortization of intangible assets
8,422
6,915
23,780
26,331
Stock-based compensation expense
192,080
161,228
550,300
519,358
Payroll tax expense related to stock-based
compensation
10,341
4,604
30,157
19,212
Gain on divestiture
—
—
—
(39,883
)
Income tax adjustments
388
200
415
462
Non-GAAP net loss
$
11,378
$
(54,428
)
$
(227,088
)
$
(267,476
)
Weighted-average common shares -
Diluted
1,466,420
1,393,358
1,446,040
1,364,327
Non-GAAP diluted net income (loss) per
share reconciliation:
Diluted net loss per share
$
(0.14
)
$
(0.16
)
$
(0.58
)
$
(0.58
)
Non-GAAP adjustment to net loss
0.15
0.12
0.42
0.38
Non-GAAP diluted net income (loss) per
share
$
0.01
$
(0.04
)
$
(0.16
)
$
(0.20
)
SNAP INC.
SUPPLEMENTAL FINANCIAL
INFORMATION AND BUSINESS METRICS
(dollars and shares in thousands,
except per user amounts below, unaudited)
Q2 2019
Q3 2019
Q4 2019
Q1 2020
Q2 2020
Q3 2020
Cash Flows and Shares
Net cash provided by (used in) operating
activities
$
(95,789
)
$
(76,149
)
$
(66,842
)
$
6,283
$
(66,554
)
$
(54,828
)
Net cash provided by (used in) operating
activities - YoY (year-over-year)
52
%
43
%
(47
)%
109
%
31
%
28
%
Net cash provided by (used in) operating
activities - TTM (trailing twelve months)
$
(420,564
)
$
(364,170
)
$
(304,958
)
$
(232,497
)
$
(203,262
)
$
(181,941
)
Purchases of property and equipment
$
(7,633
)
$
(7,938
)
$
(9,093
)
$
(10,891
)
$
(15,767
)
$
(14,727
)
Purchases of property and equipment -
YoY
(78
)%
(70
)%
(60
)%
(8
)%
107
%
86
%
Purchases of property and equipment -
TTM
$
(68,473
)
$
(50,126
)
$
(36,478
)
$
(35,555
)
$
(43,689
)
$
(50,478
)
Free Cash Flow
$
(103,422
)
$
(84,087
)
$
(75,935
)
$
(4,608
)
$
(82,321
)
$
(69,555
)
Free Cash Flow - YoY
56
%
47
%
49
%
94
%
20
%
17
%
Free Cash Flow - TTM
$
(489,037
)
$
(414,296
)
$
(341,436
)
$
(268,052
)
$
(246,951
)
$
(232,419
)
Common shares outstanding
1,372,149
1,389,395
1,415,796
1,439,589
1,463,620
1,484,716
Common shares outstanding - YoY
8
%
8
%
7
%
8
%
7
%
7
%
Shares underlying stock-based awards
180,585
175,813
160,239
149,004
152,526
138,914
Shares underlying stock-based awards -
YoY
(12
)%
(5
)%
(15
)%
(29
)%
(16
)%
(21
)%
Total common shares outstanding plus
shares underlying stock-based awards
1,552,734
1,565,208
1,576,035
1,588,593
1,616,146
1,623,630
Total common shares outstanding plus
shares underlying stock-based awards - YoY
5
%
6
%
5
%
3
%
4
%
4
%
Results of Operations
Revenue
$
388,021
$
446,199
$
560,889
$
462,477
$
454,158
$
678,668
Revenue - YoY
48
%
50
%
44
%
44
%
17
%
52
%
Revenue - TTM
$
1,395,964
$
1,544,468
$
1,715,535
$
1,857,586
$
1,923,723
$
2,156,192
Revenue by region(1)
North America
$
260,017
$
316,028
$
382,029
$
315,650
$
306,740
$
492,928
North America - YoY
47
%
52
%
42
%
40
%
18
%
56
%
North America - TTM
$
962,057
$
1,070,608
$
1,183,779
$
1,273,724
$
1,320,447
$
1,497,347
Europe
$
60,633
$
68,553
$
91,873
$
76,498
$
78,635
$
102,480
Europe - YoY
51
%
36
%
47
%
61
%
30
%
49
%
Europe - TTM
$
221,029
$
239,104
$
268,507
$
297,557
$
315,559
$
349,486
Rest of World
$
67,374
$
61,618
$
86,987
$
70,329
$
68,783
$
83,260
Rest of World - YoY
51
%
55
%
49
%
49
%
2
%
35
%
Rest of World - TTM
$
212,882
$
234,760
$
263,252
$
286,308
$
287,717
$
309,359
Operating loss
$
(304,818
)
$
(228,853
)
$
(253,596
)
$
(286,364
)
$
(310,608
)
$
(167,864
)
Operating loss - YoY
(15
)%
(29
)%
30
%
(9
)%
2
%
(27
)%
Operating loss - Margin
(79
)%
(51
)%
(45
)%
(62
)%
(68
)%
(25
)%
Operating loss - TTM
$
(1,138,957
)
$
(1,044,439
)
$
(1,103,328
)
$
(1,073,631
)
$
(1,079,421
)
$
(1,018,432
)
Net loss
$
(255,174
)
$
(227,375
)
$
(240,704
)
$
(305,936
)
$
(325,951
)
$
(199,853
)
Net loss - YoY
(28
)%
(30
)%
26
%
(1
)%
28
%
(12
)%
Net loss - TTM
$
(1,082,397
)
$
(984,624
)
$
(1,033,660
)
$
(1,029,189
)
$
(1,099,966
)
$
(1,072,444
)
Adjusted EBITDA
$
(78,713
)
$
(42,375
)
$
42,307
$
(81,237
)
$
(95,570
)
$
56,361
Adjusted EBITDA - YoY
53
%
69
%
184
%
34
%
(21
)%
233
%
Adjusted EBITDA - Margin(2)
(20
)%
(9
)%
8
%
(18
)%
(21
)%
8
%
Adjusted EBITDA - TTM
$
(390,902
)
$
(294,900
)
$
(202,230
)
$
(160,018
)
$
(176,875
)
$
(78,139
)
(1)
Total revenue for geographic reporting is
apportioned to each region based on our determination of the
geographic location in which advertising impressions are delivered,
as this approximates revenue based on user activity. This
allocation is consistent with how we determine ARPU.
(2)
We define Adjusted EBITDA margin as
Adjusted EBITDA divided by GAAP revenue.
SNAP INC.
SUPPLEMENTAL FINANCIAL
INFORMATION AND BUSINESS METRICS (continued)
(dollars and shares in thousands,
except per user amounts below, unaudited)
Q2 2019
Q3 2019
Q4 2019
Q1 2020
Q2 2020
Q3 2020
Other
DAU (in millions)
203
210
218
229
238
249
DAU - YoY
8
%
13
%
17
%
20
%
17
%
18
%
DAU by region (in millions)
North America
83
84
86
88
90
90
North America - YoY
3
%
6
%
9
%
10
%
9
%
7
%
Europe
64
65
67
70
71
72
Europe - YoY
5
%
9
%
12
%
14
%
12
%
10
%
Rest of World
56
61
64
71
77
87
Rest of World - YoY
21
%
28
%
36
%
45
%
37
%
43
%
ARPU
$
1.91
$
2.12
$
2.58
$
2.02
$
1.91
$
2.73
ARPU - YoY
37
%
33
%
23
%
20
%
—
28
%
ARPU by region
North America
$
3.14
$
3.75
$
4.42
$
3.57
$
3.40
$
5.49
North America - YoY
42
%
43
%
31
%
27
%
8
%
46
%
Europe
$
0.95
$
1.05
$
1.37
$
1.09
$
1.10
$
1.43
Europe - YoY
43
%
24
%
31
%
41
%
16
%
36
%
Rest of World
$
1.20
$
1.01
$
1.35
$
1.00
$
0.89
$
0.95
Rest of World - YoY
25
%
21
%
9
%
3
%
(26
)%
(6
)%
Employees (full-time; excludes part-time,
contractors, and temporary personnel)
2,734
2,908
3,195
3,427
3,550
3,713
Employees - YoY
(5
)%
0
%
11
%
22
%
30
%
28
%
Depreciation and amortization
expense
Cost of revenue
$
5,642
$
4,580
$
4,903
$
5,525
$
5,532
$
5,615
Research and development
7,188
8,632
8,738
8,915
8,463
9,526
Sales and marketing
3,045
3,109
3,087
3,166
3,381
3,233
General and administrative
6,785
4,325
3,892
3,598
3,549
3,430
Total
$
22,660
$
20,646
$
20,620
$
21,204
$
20,925
$
21,804
Depreciation and amortization expense -
YoY
1
%
(17
)%
(9
)%
(9
)%
(8
)%
6
%
Stock-based compensation
expense
Cost of revenue
$
1,786
$
1,332
$
1,398
$
1,782
$
2,066
$
2,623
Research and development
132,610
108,176
111,611
118,317
127,516
132,003
Sales and marketing
26,474
23,333
25,788
24,806
27,107
27,393
General and administrative
34,704
28,387
27,858
27,144
29,482
30,061
Total
$
195,574
$
161,228
$
166,655
$
172,049
$
186,171
$
192,080
Stock-based compensation expense - YoY
25
%
27
%
37
%
6
%
(5
)%
19
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201020006162/en/
Investors and Analysts: ir@snap.com
Press: press@snap.com
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