Snap Made A Loss Of $2.2 Billion In A Quarter, But It Is Not What You Think

snapchat q1 2017 results

Snap made an Initial Public Offering recently and hence became a public traded company. For 6 years, we relied on scoops to know how the company is performing but now we can be informed quartely of their performance.

In their quarterly report as a public company ending March 31st of this year, they revealed that they earned $149.6 million in revenue. This was a 286% jump from what was posted in the quarter of last year where they only earned $38.8 million.

The big news is that they made a net loss of $2.2 billion, which sounds rather absurd for a company to make such a loss in three months. Apparently under the notes, Snap says that the net loss for Q1 2017 includes $2 billion of stock compensation to its employees. However, ignoring the compensation, Snap’s actual loss was $188 million, which is double the figure posted last year’s quarter.

When it comes to growth, Snap’s Snapchat has seen quite the growth if you compare last year’s quarter to this year’s quarter. They now have 166 million daily active users, which is a 36% increase from what was posted last year. The number is also 5% up from the 158 million figure they posted in Q4 2016.

Thanks to the apparent ‘huge’ loss, Snap’s stock tanked to almost IPO share prices. The company still has a long way to catch Facebook, which makes a ton of money these days per quarter but it is still comparable to Twitter’s performance. Their app, Snapchat has made some changes recently like how long we view Snaps and now we have to wait to see how they will perform next quarter.