Snap generated revenue of $4.2 billion in 2021 but reported an annual net loss of nearly $488 million. Historically, Snap has made a net loss over the years but has made a progress in terms of lowering its losses and increasing its advertising revenue and user base. Since 2017, when the net loss amounted to $3.45 billion, Snap has made improvements in its incurred annual losses.
In Q4 2021 for the first time, Snap achieved profitability amounting to $22 million in a quarter but reported a net loss of nearly $360 million in the subsequent quarter i.e., Q1 2022. Snap has had a history of operating losses as the company prioritizes investments and expenses necessary for its long-term growth over achieving short-term profitability.
Snap’s losses have been driven due to the costs incurred due to its business expansion. Snapchat historically has recorded a growth in its user base, with this rising number of users, there has been a significant rise in the cost of hosting these users, the cost of developing new features, increasing cost of computing infrastructure, and costs associated with marketing & sales.
By the end of 2021, Snap had accumulated U.S. federal and state net operating loss (NOL) carryforwards of $7.5 billion and $4.4 billion, respectively. Of the $7.5 billion of federal net operating loss carryforwards, $1.6 billion was generated before January 1, 2018, and is subject to a 20-year carryforward period. The remaining $5.9 billion can be carried forward indefinitely but is subject to an 80% taxable income limitation as per federal regulations.
United States of America
United States of America
United States of America
United States of America
United States of America
Germany
China
United States of America
China
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