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Snap Q1 Sales Come Up Short

May 11, 2017

Snap reports financial results for the quarter ended March 31, 2017. Snap noted $150 million in sales, but investors were looking for $158 million. Daily active users were 166 million with 167 million expected.

Operational Highlights

  • Daily active users (DAU)(1) DAUs grew from 122 million in Q1 2016 to 166 million in Q1 2017, an increase of 36% year-over-year. DAUs increased 5% quarter-over-quarter, from 158 million in Q4 2016.
  • Average revenue per user (ARPU)(2) ARPU was $0.90 in Q1 2017, an increase of 181% over Q1 2016 when ARPU was $0.32. ARPU decreased 14% over Q4 2016 when ARPU was $1.05.
  • Hosting costs per DAU Hosting costs per DAU were $0.60 in Q1 2017, as compared to $0.52 in Q1 2016 and $0.72 in Q4 2016.
  • Capital expenditures Capital expenditures were $18.0 million in Q1 2017, as compared to $12.5 million in Q1 2016 and $20.4 million in Q4 2016.

First Quarter 2017 Financial Highlights:

    Three Months Ended March 31,   Percent
      2017       2016     Change
    (dollars in thousands)
(Unaudited)   (NM = Not Meaningful)
Revenue   $ 149,648     $ 38,798     286 %
Net loss(1)   $ (2,208,837 )   $ (104,576 )  

NM

 

Adjusted EBITDA(2)   $ (188,243 )   $ (93,234 )   102 %
             
Other Financial Highlights            
Cash, cash equivalents, and marketable securities   $ 3,242,556     $ 987,368      
Cash used in operating activities   $ (154,997 )   $ (92,541 )    
Free Cash Flow(3)   $ (172,990 )   $ (104,993 )    
Capital expenditures   $ (17,993 )   $ (12,452 )    

 

 

(1)

 

Net loss for Q1 2017 includes $2.0 billion of stock-based compensation expense, primarily due to the recognition of expense related to RSUs with a performance condition satisfied on the effectiveness of the registration statement for our initial public offering.

(2)

 

Adjusted EBITDA is defined as net income (loss), excluding interest income; interest expense; other income (expense) net; income tax benefit (expense); depreciation and amortization; and stock-based compensation expense and related payroll tax expense.

(3)

 

Free Cash Flow is defined as net cash used in operating activities, reduced by purchases of property and equipment.

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