Skip to main content

Snap public IPO finally gives insight into Snapchat’s financials and user numbers

snapchat-ceo-evan-spiegel
Image used with permission by copyright holder
Snap Inc., the maker of visual messaging app Snapchat, has released its initial public offering (IPO) filing through the Securities and Exchange Commission. The document finally offers an insight into the workings of one of the most secretive tech companies.

Just over five years since its launch, the Snapchat app reached 158 million global daily active users as of December 31, 2016, a year-over-year growth of 48 percent. The majority of that figure is made up of North American users, which totaled 68 million in its fourth quarter 2016, an increase of 40 percent over the previous year. Europe is Snapchat’s second biggest region with 52 million users, and in the rest of the world the app has amassed 39 million users — although that figure was stagnant in its most recent quarter.

Snap has refrained from providing monthly active users (MAUs) in its filing. This could be because it does not want to attract unfavorable comparisons with bigger rivals Facebook (1.86 billion MAUs) and Instagram (600 million MAUs).

Image used with permission by copyright holder

On average, Snapchatters share more than 2.5 billion snaps per day and visit the app around 18 times daily, spending 25 to 30 minutes on the app. In comparison, Facebook announced in April that users spend over 50 minutes across its suite of apps (including its flagship social network, Messenger, and Instagram — but not WhatsApp), which have an accumulative user base of almost 3.5 billion members. One thing is clear: Snapchat boasts an engaged fan base.

In terms of total revenue, Snap Inc. lists $404.5 million in 2016, up by over 600 percent from $58 million a year earlier. The company earned a net loss of $514.6 million last year.

“We have incurred operating losses in the past, expect to incur operating losses in the future, and may never achieve or maintain profitability,” it said in the filing.

The worrying revelation has already seen analysts compare the company to another platform that struggled to build upon the hype generated by its IPO, namely Twitter. “To me, Snap is Twitter 2.0 — a company with a good growth rate that is losing a ton of cash, coupled with a massive valuation,” Brian Hamilton, co-founder of private company analysis firm Sageworks, told CNN.

The vast majority of Snap’s revenue ($400 million) came from advertising, including its skippable, full-screen Snap ads and sponsored creative tools (sponsored lenses and geofilters).

Further breaking down its revenue, Snapchat earns on average a dollar from each of its 158 million global users. In its fourth quarter, Snapchat earned an average revenue of $2.15 per North American user — comparatively, its earnings from European users ($0.28) and the rest of the world ($0.15) during the same period didn’t even come close.

As its filing proves, the previous year was a huge period in Snap’s growth. In terms of product innovation it released over a dozen updates to its Snapchat app, including group chat, voice and video calling, Bitmoji, and Memories, among others.

Snap’s first hardware device, dubbed “Spectacles” Image used with permission by copyright holder

In September, Snap unveiled its first-ever hardware device in the form of its snap-recording sunglasses: Spectacles. At the same time, it began branding itself as a “camera company” focused on “reinventing the camera.”

Snap also aggressively expanded its workforce in 2016, opening new offices in London, Los Angeles, and China (despite being banned in the country). By the end of 2016, Snap employed 1,859 staff members.

Snap is still expected to go public in March, with a valuation estimated between $25-$30 billion, making it the highest U.S. tech IPO since Chinese e-commerce giant Alibaba Group Holding Ltd. debuted at $168 billion in 2014.

The company, co-founded in 2011 by Evan Spiegel, Bobby Murphy and Reggie Brown, hopes to raise $3 billion from the nonvoting shares it is offering as part of its IPO. It fittingly chose “SNAP” as its NYSE ticker symbol.

Editors' Recommendations

Saqib Shah
Former Digital Trends Contributor
Saqib Shah is a Twitter addict and film fan with an obsessive interest in pop culture trends. In his spare time he can be…
Need Help? These Are the Best places to hire people online
ZipRecruiter Job Board Lifestyle Post

This content was produced in partnership with ZipRecruiter.
Hiring the right people is a crucial part of developing your business. The best person for the job will be one that shares your vision, is highly responsible, appropriately skilled, and is an efficient worker. You know what you want from your next employee but what do you do when it comes to finding that person? With many different sources out there for finding the best way to hire employees, we've picked out the best places to hire people online including ways to find employees online fast or for a long-term commitment. There are dozens of sites available but it's important to pick the best outlet for the task, so you can spend less time on your recruitment drive and more time interviewing the best candidates for the job. Take a look below at the best places to hire people online.
ZipRecruiter

One of the most reliable names in the job posting world, ZipRecruiter is a great way of finding staff and quickly. It aims to make the hiring process as smooth as possible. It works by connecting to more than 100 job boards so the moment you create a job listing for your firm, ZipRecruiter posts it across the huge network so you're casting the net as wide as possible without having to manually create job listings at numerous sources.

Read more
The best 17-inch laptop bags and backpacks for 2023
Close up view of a zipper on an Asus ROG Nomad V2 backpack.

You need a bag to safely transport your laptop with you to work or school, but not all laptop bags are created equal. Some bags aren’t robust enough to carry heavier models or large enough to carry your charger and extra supplies. Some bags come at an affordable price, while other options are more of an investment.

Whether you’re in search of a sleek briefcase or a tricked-out gaming backpack, skip the guesswork and read on to find out the best ways to carry your laptop in 2023.

Read more
The Best Hiring Apps for Recruiters
Hiring handshake best hiring apps for recruiters

This content was produced in partnership with ZipRecruiter.
The best employment software, and comparable mobile applications, offer a valuable set of tools for hiring managers, HR, and even recruiters. They essentially streamline the candidate search and onboarding processes, making it easier to find potential hires but also to communicate, engage, and research them more in-depth. It stands to reason then that the best hiring apps for recruiters are the same hiring resources that nearly every professional can use, and while that may be true, there's one exception. Recruiting specific tools make it easier for recruiters to seek out and secure top-tier talent, and to continue that consistently. That means they include talent sourcing tools, interviewing, and communication tools, and sometimes scheduling and calendar tools to keep everything organized.

You might not think they're much different, but for recruiters, the best hiring apps also offer a reliable way to keep their finger on the pulse of the very broad talent pool. In light of that, here are the best hiring apps for recruiters:

Read more