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Snap Inc. Third Quarter 2017 Results

investor.snap.com

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Re: Snap Inc. Third Quarter 2017 Results

#161

Post by skuhn »

mrep wrote: post #92
replicatorblog wrote: post #52

Interesting factoid: Snap's current market cap ($18.1B) is lower than the price Facebook paid for WhatsApp ($19B). Snap is now "only" worth $4B more than Twitter. Does FB wait for the price to fall and take them out for $10B? Or grind them to dust to make an example of any startup foolhardy enough to forgo an acquisition offer?

The 2 founders own majority share of voting rights so facebook could not unless they agreed to it

Snap went beyond just retaining a majority of voting control with the founders. Due to the share structure, the two Snap founders control 88.5% of the voting rights. Their shares are worth 10x, and publicly traded shares are worth 0x.

Anyone with holdings in Snap who aren't named Evan Spiegel or Bobby Murphy have only one option: sell the stock and recoup whatever they can. That's what people are doing. Snap's share price will not substantially recover, and there won't be a return from an acquisition until the business completely runs out of money.

Re: Snap Inc. Third Quarter 2017 Results

#162

Post by Quarrelsome »

jmbrook wrote: post #155

https://wolfstreet.com/2017/11/07/how-can-a-company-once-wor... Has a fairly bleak write up. It makes the point that if enriching the founders is the aim they are doing pretty well.

I love that sales projection that demonstrates some people are unaware that there are potential uptake numbers lower than 1% :D.

> "Even if only 1% of people buy them we'll still profit!"

Re: Snap Inc. Third Quarter 2017 Results

#163

Post by irishbro »

brianwawok wrote: post #58
georgeecollins wrote: post #42

The thing that is killing them is not the hosting costs, it is the ARPU. They are getting like $1 ARPU per quarter while FB gets like $4-5. That is what they have to change.

How? How many ads will you watch before you dump the platform?

They could try introducing some filters you have to pay for. It might be tough surviving the initial backlash due to people expecting them to be free but as long as they keep releasing some free ones they should survive. The other problem is their demographic is a bit younger so might not have that much disposable income but that didn't deter them from releasing glasses that cost >$100. I think parents would be more likely to pay $1.99 for a pack of 5 special filters for their child rather than getting the glasses.

Re: Snap Inc. Third Quarter 2017 Results

#164

Post by mongodude »

base698 wrote: post #139
rgbrenner wrote: post #28

Earlier quoted context omitted.

They have to receive the picture, then send it to a number of other users. So it's probably mostly bandwidth charges. They use Google, right? When was the last time Google (or any of the cloud providers) lowered their bandwidth charges? That small fluctuation is probably just minor variations in usage.

Could also be incompetence in regards to managing servers and load testing with laziness for not shutting down instances and ignorance of using reserved instances? Ahem, I mean it could be.

Hehe! You will be surprised how often this happens in best of the companies. A large fintech startup I work with had 5 GPU servers lying around idle before the CTO realized that they only need them while training the Machine Learning models and not during inference stage.

Re: Snap Inc. Third Quarter 2017 Results

#165

Post by snaily »

cstejerean wrote: post #137
jjcm wrote: post #119

Earlier quoted context omitted.

Assuming half of it is bandwidth costs, that means that a daily active user is using ~380 MB/day (assuming $0.01/GB). That seems pretty hefty as an average. Especially if you consider the encoding snapchat uses puts each 10s video at about 1MB in size. 380MB is a little over an hour of snapchat quality video, that seems excessive as an average. If I were a major stockholder I'd be pushing to see why these hosting cos…

I think that’s $0.60 per quarter not per day. 380MB for the quarter per daily active user doesn’t seem that unreasonable.

$0.60 for 380MB seems unreasonable, though. I think the GP was calculating based on the quarterly period.

Re: Snap Inc. Third Quarter 2017 Results

#166

Post by fwn »

batiudrami wrote: post #142
siddharthdeswal wrote: post #123

Earlier quoted context omitted.

I could agree with you even more than what I already do. My social life is on WhatsApp groups. No one in my social circle uses Facebook Messenger for anything relevant. The number of friends' photos has steadily gone down over the years. I've switched off FB but come back when am bored and want to spend time looking at cat photos and BuzzFeed. Facebook not existing in the world would impact me minimally. Google, and…

I mean. Facebook owns Whatsapp. And if you're not in a WhatsApp country, the US, Korea, Japan or China, you're in a Facebook Messenger country. They handle messaging for the vast majority of the western world. The Facebook website itself is no longer particularly useful to me, other than that it is very good at events (both private and for public event discovery). The groups feature is also handy.

Other than with Facebook's messenger, your WhatsApp social graph is in your phones addressbook. If Facebook's WhatsApp service were to be gone tomorrow you could just install the next biggest messenger and beyond minor initial fragmentation all your friends would still be there.

This wouldn't work with the Facebook Messenger, since this social graph is not stored by the user.

Re: Snap Inc. Third Quarter 2017 Results

#167

Post by jondubois »

fullshark wrote: post #53
jondubois wrote: post #39

Earlier quoted context omitted.

- They lost $3 Billion in 9 months. - For every $6 they spent, they got back $1 in revenue. - The product is an app which is free to use. - A large chunk of their system runs on Google App Engine; which is probably the most expensive and highest lock-in infrastructure solution that you could possibly use. - The CEO, who was basically fresh out of university, turned down a $4 Billion offer buy the company. So basicall…

The ceo got almost 4 billion taking the company public and he still controls his baby. I think he’s made some mistakes but keeping his company isn’t one of them.

Yeah but then he'll have to deal with the lawsuits and the bad rep when it all collapses.

Re: Snap Inc. Third Quarter 2017 Results

#168

Post by hkmurakami »

runeks wrote: post #145
cvaidya1986 wrote: post #80

Earlier quoted context omitted.

It’s ok to take big bets. Sometimes they are too early but taking big bets is a sign of a budding great company. Disclaimer : Not an investor in SNAP

Taking big bets that turn profitable is a sign of a great company. Taking big bets that lose money is a sign of an soon-to-be-bankrupt company.

Fire Phone anyone?

Re: Snap Inc. Third Quarter 2017 Results

#169

Post by dagw »

Quarrelsome wrote: post #162
jmbrook wrote: post #155

https://wolfstreet.com/2017/11/07/how-can-a-company-once-wor... Has a fairly bleak write up. It makes the point that if enriching the founders is the aim they are doing pretty well.

I love that sales projection that demonstrates some people are unaware that there are potential uptake numbers lower than 1% :D. > "Even if only 1% of people buy them we'll still profit!"

I love that sales projection that demonstrates some people are unaware that there are potential uptake numbers lower than 1%

"The number smaller than 1 is 0, and we're obviously going to sell more than 0" ;)

Re: Snap Inc. Third Quarter 2017 Results

#170

Post by hkmurakami »

jsemrau wrote: post #138
rock_hard wrote: post #88

Earlier quoted context omitted.

I personally couldn’t disagree more. If you cut me off tomorrow of Facebook and Messeneger I would instantly loose contact to the majority of people I care about (except my wife and parents). I would end up spending life on my couch watching Netflix instead of engaging in a rich social life I have now thanks to FB events, groups, Messeneger, etc. And I guarantee you that’s true for a large amount of the user base! Ot…

That sounds really sad, to be honest. Where are you living that you can't have face to face interactions on a regular basis.

Many of them are abroad.
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