Snapchat’s become a fast favorite of fashion and all that advertising love showed up in its parent company’s IPO filing Thursday, which showed a dramatic boost in sales last year.
Snap Inc.’s revenues shot up to $404.5 million last year, up from $58.7 million in 2015. However, the company — which is investing heavily in its growth, for instance, introducing its camera-toting Spectacles last year — is still losing a massive amount of money: $514.6 million last year.
That’s not expected to temper investor enthusiasm too much, though, and the company’s offering is expected to raise as much as $25 billion.
The filing late Thursday also gave a peek at the secretive company’s internal workings.
Snap said: “Substantially all of our revenue comes from advertising, so our ability to generate revenue in a particular country depends on the size of its advertising market.”
It noted that global advertising spend — especially mobile advertising spend — is extremely concentrated, with more than 70 percent of overall advertising spend and nearly 85 percent of mobile advertising spend coming from the top 10 advertising markets, citing data from International Data Corp. The company also said that “on average, over 60 percent of its daily active users” are from countries on ICD’s top 10 advertising markets.
The company said its strategy is to invest in product innovation and “take risk to improve our camera platform,” noting that its focus is to drive user engagement because that can be monetized through advertising.
“We use the revenue we generate to fund future product innovation to grow our business,” the company said.
The company’s nonemployee directors include Joanna Coles, 54, chief content officer of Hearst Magazines, and A.G. Lafley, 69, former president and chief executive officer of the Procter & Gamble Co. Coles and Lafley are members of the firm’s nominating and corporate governance committee. Lafley is also on the firm’s compensation committee.
Coles received total compensation of $110,866 from Snap last year, which included stock awards valued at $75,866 and a cash retainer of $35,000. Lafley received compensation of $2.6 million, which included stock awards valued at $2.5 million and a $200,000 annual cash retainer to cover the costs of his travel to company meetings and events. Lafley’s retainer also is paid quarterly following the completion of each full quarter.