One of the most awaited IPOs of the year on Wall Street is approaching: that of Snap, the parent company of Snapchat, the social network that allows you to send photos and videos that are automatically deleted after viewing. Founded in 2011 by Evan Siegel (26), Snapchat managed to overtake Twitter in 2016 in terms of daily active users and is now aiming for a $3 billion placement, with an initial capitalization of at least $25 billion. The offering is led by Goldman Sachs and Morgan Stanley.
At the moment, the accounts travel in the red. The prospectus filed with the securities regulator shows that the company closed 2016 with a loss of $514,64 million, worse than the $372,89 million loss in 2015. Snap warned: “We suffered an operating loss in past, we expect to incur an operating loss in the future and may never achieve or maintain profitability."
2016 revenues were $404,48 million versus $58,66 million in 2015; in the fourth quarter alone, the average revenues per user rose to 1,05 dollars against 31 cents in the same period of the previous year.
In the quarter ended December 31, 2016, 158 million people used the app every day, 48% more than in the same period a year earlier. However Snap lists a number of risks associated with user loyalty, concentrated in the 18-34 age group. They could “turn to other products, which would weigh negatively on growth”.
