Snapchat parent Snap Inc. officially filed its initial public offering on Thursday, planning to raise up to $3 billion, ahead of what is widely expected to be one of the biggest U.S. tech IPOs since Facebook.
The filing provides the first official glimpse of the popular social app’s financial results. Last year, Snap generated more than $404 million in revenue, compared to $58 million in 2015. Snap more than doubled the amount it was investing in research and development along with sales and marketing last year, with those numbers alone topping $300 million. It lost around $515 million in 2016, compared with a loss of $373 million the year before.
According to the filing, 158 million people use Snapchat daily, creating more than 2.5 billion Snaps per day. The majority its users are younger, between the ages of 18 and 34.
When detailing risk factors in the filing, the company said that it anticipates “that the growth rate of our user base will decline over time,” and therefore the company will depend more on engagement of users and developing new products. Last year, the company released Spectacles, glasses that feature a camera for Snapchat, and it plans to “significantly broaden” their distribution. In the filing, Snap defines itself as a camera company as opposed to a social media site.
Snap also pointed to the “highly competitive” nature of the business, pointing to Apple, Facebook, Google and Twitter as some of its main competitors.
“We face significant competition that we anticipate will continue to intensify. If we are not able to maintain or improve our market share, our business could suffer,” Snap wrote in its filing.
To remain competitive, the company detailed plans to spend $2 billion over the next five years with Google Cloud, where it hosts the majority of its computing and software systems.
Evan Spiegel and Robert Murphy, Snap’s two cofounders, will have sole control over stockholder decisions, according to the filing, unlike most other publicly-traded companies.
“Mr. Spiegel and Mr. Murphy, and potentially either one of them alone, have the ability to control the outcome of all matters submitted to our stockholders for approval, including the election, removal, and replacement of directors and any merger, consolidation, or sale of all or substantially all of our assets,” Snap wrote.
The stock will be traded on the New York Stock Exchange under the symbol “SNAP” and is expected to go public in March.
Here’s Spiegel explaining the ethos of Snapchat from a 2015 video: