#1Snap Inc. Q4 2022 Earnings Slides January 31, 2023#2Forward-Looking Statements & Non-GAAP Financial Measures This presentation contains forward-looking statements about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this presentation, including statements regarding guidance, our future results of operations or financial condition, future stock repurchase programs or stock dividends, business strategy and plans, user growth and engagement, product initiatives, objectives of management for future operations, and advertiser and partner offerings are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as "anticipate," "believe," "contemplate," "continue," "could," "estimate," "expect," "going to," "intend," "may," "plan," "potential," "predict," "project," "should," "target," "will," or "would" or the negative of these words or other similar terms or expressions. We caution you that the foregoing may not include all of the forward-looking statements made in this presentation. You should not rely on forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this presentation on our current expectations and projections about future events and trends, including our financial outlook, macroeconomic uncertainty, geo-political conflicts, and the COVID-19 pandemic, that we believe may continue to affect our business, financial condition, results of operations, and prospects. These forward-looking statements are subject to risks, uncertainties, and other factors, including those described in the sections titled "Risk Factors" and elsewhere in our most recent periodic report filed with the SEC, which is available on the SEC's website at www.sec.gov. Additional information will be made available in our periodic report that will be filed with the SEC for the period covered by this presentation and other filings that we make from time to time with the SEC. In addition, the forward-looking statements in this presentation relate only to events as of the date on which the statements are made and are based on information available to us as of the date of this presentation. We undertake no obligation to update any forward-looking statements made in this presentation to reflect events or circumstances after the date of this presentation or to reflect new information or the occurrence of unanticipated events, including future developments related to geo-political conflicts, the COVID-19 pandemic, and macroeconomic conditions, except as required by law. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, dispositions, joint ventures, restructurings, legal settlements or investments. This presentation includes certain non-GAAP financial measures. These non-GAAP financial measures, which may be different than similarly titled measures used by other companies, are presented to enhance investors' overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. A reconciliation of GAAP to non-GAAP measures is provided in the Appendix of this presentation. 2#3Fourth Quarter Financial Summary Revenue Operating Performance Cash ● ● Operating margin was (22)% in Q4 2022, compared to (2) % in Q4 2021. Adjusted gross margin² was 64% in Q4 2022, compared to 66% in Q4 2021. • Net loss was $288 million in Q4 2022, including restructuring charges of $34 million, compared to net income of $23 million in Q4 2021. • Adjusted EBITDA³ was $233 million in Q4 2022, compared to $327 million in Q4 2021. • Adjusted EBITDA margin³ was 18% in Q4 2022, compared to 25% in Q4 2021. ● ● ● Revenue was $1,300 million in Q4 2022, compared to $1,298 million in Q4 2021. On a constant currency basis' to account for changes in foreign exchange rates, the estimated growth was 2% year-over-year. Average revenue per user was $3.47 in Q4 2022, compared to $4.06 in Q4 2021. ● Operating cash flow was $125 million in Q4 2022, compared to $186 million in Q4 2021. Free Cash Flow³ was $78 million in Q4 2022, compared to $161 million in Q4 2021. Cash, cash equivalents, and marketable securities were $3.9 billion as of December 31, 2022. 'Constant currency revenue is a non-GAAP measure, which we define as GAAP revenue in the current period translated using the prior period average monthly exchange rates for revenue transactions in currencies other than the U.S. dollar. The constant currency revenue percentage change is determined using current period constant currency revenue and prior period GAAP revenue. ²Adjusted gross margin is a non-GAAP measure, which we define as GAAP revenue less adjusted cost of revenue divided by GAAP revenue. Adjusted cost of revenue is a non-GAAP measure and excludes stock-based compensation expense, payroll and other tax expense related to stock-based compensation, depreciation and amortization, and certain other non-cash or non-recurring items impacting net income (loss) from time to time. ³Adjusted EBITDA margin is a non-GAAP measure, which we define as Adjusted EBITDA divided by GAAP revenue. See Appendix for non-GAAP measures of Adjusted EBITDA and Free Cash Flow, including reconciliations of net loss to Adjusted EBITDA and net cash provided by (used in) operating activities to Free Cash Flow. Quarterly information is unaudited. Numbers throughout presentation may not foot due to rounding. Q4 2022 REVENUE WAS $1.3 BILLION; ON A CONSTANT CURRENCY BASIS¹, ESTIMATED GROWTH OF 2% YoY FREE CASH FLOW WAS $78 MILLION IN Q4 2022 3#4Business Highlights We grew and deepened our engagement with our community: DAUS were 375 million in Q4 2022, an increase of 56 million, or 17% year-over-year. • DAUS increased sequentially and year-over-year in each of North America, Europe, and Rest of World. • Total time spent watching Spotlight content grew over 100% year-over-year. 17 content partners reached over 50 million global viewers each in Q4 2022. ● ● Through our broadcast partnerships with beIN SPORTS in Qatar and France, ITV in the UK, MediaPro in Spain, and Bell in Canada, among others, over 60 million Snapchatters watched World Cup Stories content on Snapchat and over 285 million Snapchatters engaged with World Cup AR. • We renewed our partnerships with UFC and the Washington Post in the US. Internationally, we expanded our partnership with Groupe M6 in France and signed new agreements with BBC Studios in the UK, G+J Medien (RTL) in Germany, and Totem Global in Australia. We are focused on expanding and diversifying our revenue growth: • In Q4, our subscription service Snapchat+ reached over 2.0 million paying subscribers. Snapchat+ offers exclusive, experimental, and pre-release features, and in Q4 we launched new features such as Custom Story Expiration and Custom Notification Sounds, providing subscribers with over 12 exclusive features. • We've improved the accessibility of Conversions API (CAPI) by enabling access through four new third-party partners, closing the year with 12 total, making CAPI more accessible to all advertisers on our platform. We've accelerated our commerce integrations through the launch of our partnership with BigCommerce, enabling tens of thousands of merchants to seamlessly sync catalogs and run Dynamic Ads. • We've partnered with Smartly.io to unlock growth and drive performance through real time automation. Through Smartly.io's creative and campaign management tools, brands can tap into their automated ads by scaling thousands of targeted versions. • Thousands of brands continued investing in their organic presence on Snapchat via Public Profiles for Businesses to build deeper connections, and grow their audience and organic engagements. 4#5Business Highlights (Continued) We invested in our augmented reality platform: Over 300,000 AR creators and developers have built more than 3 million AR Lenses. • In our latest Lens Studio release, we unveiled several new features including garment, earring, and wrist wear try-on. • We powered more than 161 million product trials by over 35 million Snapchatters for Walmart, leveraging Catalog-Powered Shopping Lenses at-scale. • We launched a new Camera Kit integration with H&M enabling an AR try-on experience of their collection of immersive AR fashion, co-designed by H&M and the Institute of Digital Fashion. • Luxottica Sunglass Hut drove over 14 million try-ons through Catalog-powered Shopping Lenses. • In celebration of the film Avatar: The Way of Water, we teamed up with Disney to create an augmented reality Lens that turns any Snapchatter into a Na'vi. This is the first ever sponsored AR Lens integration into the SoFi Stadium infinity screen surprising and delighting attendees. • In partnership with New Balance, we created a Holiday Gifting Concierge Lens to offer Snapchatters gifting inspiration using augmented reality and speech recognition via voiceML. • We announced a first-of-its-kind Bitmoji Drop in partnership with adidas that allows Snapchatters to use Snap Tokens to claim an exclusive adidas track jacket. Snapchatters viewed the Bitmoji Drop banner over 280 million times. 5#6Average Daily Active Users (DAU) (in millions, unaudited) GLOBAL 306 Q3'21 EUROPE² 80 Q3'21 319 Q4'21 82 Q4'21 332 Q1'22 84 Q1'22 + 17% 347 Q2'22 + 12% 86 Q2'22 363 Q3'22 88 Q3'22 375 Q4'22 92 Q4'22 NORTH AMERICA¹ 96 Q3'21 REST OF WORLD 130 Q3'21 97 Q4'21 140 Q4'21 98 GLOBAL DAU INCREASED 56 MILLION, OR 17%, YOY Q1'22 150 Q1'22 + 3% 99 Q2'22 + 31% 162 Q2'22 100 Q3'22 175 Q3'22 100 Q4'22 183 Q4'22 We define a Daily Active User, or DAU, as a registered Snapchat user who opens the Snapchat application at least once during a defined 24-hour period. We calculate average Daily Active Users for a particular quarter by adding the number of DAUs on each day of that quarter and dividing that sum by the number of days in that quarter. 'North America includes Mexico, the Caribbean, and Central America. ²Europe includes Russia and Turkey. Numbers throughout presentation may not foot due to rounding. 6#7Revenue by Geography (in millions, unaudited) GLOBAL $1,067 Q3'21 EUROPE² $153 $1,298 Q4'21 $209 $1,063 Q1'22 $162 + 0.1% $1,111 Q2'22 + 5% $170 $1,128 Q3'22 $161 $1,300 Q4'22 $219 NORTH AMERICA¹ $787 Q3'21 $932 $127 Q4'21 REST OF WORLD $157 $758 Q1'22 $142 - 6% $786 Q2'22 + 28% $155 $812 Q3'22 $155 $880 Q4 2022 REVENUE WAS $1.3 BILLION; ON A CONSTANT CURRENCY BASIS³, ESTIMATED GROWTH OF 2% YoY FULL YEAR 2022 REVENUE INCREASED 12% YoY TO $4.6 BILLION Q4'22 $201 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q3'21 Total revenue for geographic reporting is apportioned to each region based on our determination of the geographic location in which advertising impressions are delivered, as this approximates revenue based on user activity. This allocation is consistent with how we determine ARPU. 'North America includes Mexico, the Caribbean, and Central America. 2Europe includes Russia and Turkey. Effective March 2022, we halted advertising sales to Russian and Belarusian entities. ³Constant currency revenue is a non-GAAP measure, which we define as GAAP revenue in the current period translated using the prior period average monthly exchange rates for revenue transactions in currencies other than the U.S. dollar. The constant currency revenue percentage change is determined using current period constant currency revenue and prior period GAAP revenue. Numbers throughout presentation may not foot due to rounding. Q4'22 7#8Average Revenue Per User (ARPU) (unaudited) GLOBAL $3.49 Q3'21 EUROPE² $1.92 $4.06 Q3'21 Q4'21 $2.54 $3.20 Q4'21 Q1'22 $1.93 15% Q1'22 $3.20 Q2'22 - 6% $1.98 $3.11 Q2'22 Q3'22 $1.83 $3.47 Q3'22 Q4'22 $2.38 NORTH AMERICA¹ Q4'22 $8.20 Q3'21 $0.98 $9.58 REST OF WORLD Q4'21 Q3'21 $1.12 Q4'21 $7.77 GLOBAL ARPU INCREASED 11% QoQ to $3.47 IN Q4 2022 Q1'22 $0.95 - 9% Q1'22 $7.93 Q4'22 We define ARPU as quarterly revenue divided by the average Daily Active Users. For purposes of calculating ARPU, revenue by user geography is apportioned to each region based on our determination of the geographic location in which advertising impressions are delivered, as this approximates revenue based on user activity. 'North America includes Mexico, the Caribbean, and Central America. ²Europe includes Russia and Turkey. Effective March 2022, we halted advertising sales to Russian and Belarusian entities. Numbers throughout presentation may not foot due to rounding. Q2'22 - 2% $0.96 $8.13 Q2'22 Q3'22 $0.89 $8.77 Q3'22 Q4'22 $1.10 8#9Adjusted Gross Margin and Adjusted Cost of Revenue¹ (dollars in millions, unaudited) Adjusted Cost of Revenue as a % of Revenue ADJUSTED GROSS MARGIN¹ 60% Q3'21 40% 66% Q4'21 61% Q1'22 39% - 2 PPT 61% Q2'22 61% Q3'22 64% Q4'22 6% Total Non-GAAP Exclusions Total GAAP Cost of Revenue ADJUSTED COST OF REVENUE¹ COMPOSITION Infrastructure Costs Content & Developer Partner Costs $429 $149 $78 $202 Q3'21 $14 $443 $442 $143 $87 $212 Q4'21 $8 $449 $413 ADJUSTED GROSS MARGIN' IMPROVED 3 PPT QOQ $146 $73 $194 Q1'22 $8 $421 Advertising Partner & Other Costs + 6% $438 $162 $76 $201 Q2'22 $8 $446 $446 $160 $74 $212 Q3'22 $21 $467 $468 $176 $80 $212 Q4'22 $13 $481 'Adjusted gross margin is a non-GAAP measure, which we define as GAAP revenue less adjusted cost of revenue divided by GAAP revenue. Adjusted cost of revenue is a non-GAAP measure and excludes stock-based compensation expense, payroll and other tax expense related to stock-based compensation, depreciation and amortization, and certain other non-cash or non-recurring items impacting net income (loss) from time to time. In Q3 2022 and Q4 2022, non-recurring items included restructuring charges of $14 million and $7 million, respectively. See Appendix for further detail. Numbers throughout presentation may not foot due to rounding. 9#10Adjusted Operating Expense Margin and Adjusted Operating Expenses¹ (dollars in millions, unaudited) Adjusted Operating Expenses as a % of Revenue ADJUSTED OPERATING EXPENSE MARGIN¹ 57% Q3'21 43% 59% Q4'21 41% 45% Q1'22 55% - 5 PPT 40% Q2'22 46% Q3'22 54% 54% Q4'22 46% Total Non-GAAP Exclusions Total GAAP Operati Expenses ADJUSTED OPERATING EXPENSES¹ COMPOSITION $464 $127 $156 $182 Q3'21 $341 $805 Research & Development General & Administrative $530 $141 $189 $199 Q4'21 $344 $874 $586 $161 $189 $235 Q1'22 $328 $913 ADJUSTED OPERATING EXPENSES DOWN 10% FROM Q2 2022 Sales & Marketing + 13% $665 $199 $212 $255 Q2'22 $400 $1,065 $610 $174 $192 $244 Q3'22 $487 $1,097 $599 $151 $217 $231 Q4'22 $507 $1,106 'Adjusted operating expense margin is a non-GAAP measure, which we define as GAAP revenue less adjusted operating expenses, divided by GAAP revenue. Adjusted operating expenses is a non-GAAP measure and excludes stock-based compensation expense, payroll and other tax expense related to stock- based compensation, depreciation and amortization, and certain other non-cash or non-recurring items impacting net income (loss) from time to time. In Q3 2022 and Q4 2022, non-recurring items included restructuring charges of $141 million and $27 million, respectively. See Appendix for further detail. Numbers throughout presentation may not foot due to rounding. 10#11Net Income (Loss) & Adjusted EBITDA¹ (dollars in millions, unaudited) NET INCOME (LOSS) (7)% $(72) Q3'21 Net Income (Loss) Margin $23 2% Q4'21 (34)% $(360) Q1'22 (38)% $(422) Q2'22 (32)% $(360) Q3'22 (22)% $(288) Q4'22 ADJUSTED EBITDA¹ $174 16% Q3'21 Adjusted EBITDA Margin² $327 25% Q4'21 $64 6% Q1'22 $7 1% ADJUSTED EBITDA WAS $233 MILLION IN Q4 2022 THIRD CONSECUTIVE FULL YEAR OF ADJUSTED EBITDA PROFITABILITY Q2'22 $73 6% Q3'22 $233 18% Q4'22 'Adjusted EBITDA is a non-GAAP measure, which we define as net income (loss), excluding interest income; interest expense; other income (expense), net; income tax benefit (expense); depreciation and amortization; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; and certain other non-cash or non-recurring items impacting net income (loss) from time to time. In Q3 2022 and Q4 2022, non-recurring items included restructuring charges of $155 million and $34 million, respectively. See Appendix for reconciliation of net loss to Adjusted EBITDA. ²Adjusted EBITDA margin is a non-GAAP measure, which we define as Adjusted EBITDA divided by GAAP revenue. Numbers throughout presentation may not foot due to rounding. 11#12Diluted Net Income (Loss) Per Share & Common Shares Outstanding Plus Shares Underlying Stock-Based Awards (in millions, except per share data, unaudited) Total Non-GAAP Exclusions Non-GAAP diluted net income (loss) per share² DILUTED NET INCOME (LOSS) PER SHARE¹ $(0.05) Q3'21 $0.22 $0.01 $0.17 Q4'21 $0.21 $(0.22) $0.22 Q1'22 $0.20 $(0.26) Q2'22 $(0.02 $0.24 $(0.22) Q3'22 $0.30 $(0.18) $0.08 Q4'22 $0.32 Shares repurchased $0.14 YOY Change excluding exchange shares COMMON SHARES OUTSTANDING PLUS SHARES UNDERLYING STOCK-BASED AWARDS 1,698 93 1,605 Q3'21 Common Shares Outstanding Shares Underlying Stock-Based Awards³ 1.3% 1,702 83 1,619 Q4'21 1,708 75 1.2% 1,633 Q1'22 1,737 92 1.3% 1,645 Q2'22 $(0.02) 'Diluted net income (loss) per share is calculated using weighted average shares outstanding during the period. Diluted net income per share in Q4 2021 includes 64 million shares in excess of weighted average shares outstanding during the period primarily related to unvested or unexercised stock-based awards. 2We define Non-GAAP net income (loss) as net income (loss); excluding amortization of intangible assets; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; certain other non-cash or non-recurring items impacting net income (loss) from time to time; and related income tax adjustments. Non-GAAP net income (loss) and weighted average diluted shares are then used to calculate Non-GAAP diluted net income (loss) per share. In Q3 2022 and Q4 2022, non-recurring items included restructuring charges of $155 million and $34 million, respectively. See Appendix for reconciliation of diluted net income (loss) per share to non-GAAP diluted net income (loss) per share. 1,701 95 2.5% 1,606 Q3'22 51.3 1,706 132 0.2% 1,574 Q4'22 53.9 0.2% ³Shares underlying stock-based awards include restricted stock units, restricted stock awards, and outstanding stock options. "YoY change in all periods exclude approximately 52 million shares issued as part of the induced conversions of convertible notes. Numbers throughout presentation may not foot due to rounding. REPURCHASED $1 BILLION OF SHARES IN 2022, REDUCING CLASS A SHARES OUTSTANDING AT YEAR END BY OVER 6% 12#13Capex Operating Cash Flow and Free Cash Flow¹ (in millions, unaudited) OPERATING CASH FLOW $72 Q3'21 $(20) $186 Q4'21 $(25) $127 Q1'22 $(21) $(124) Q2'22 $(23) $56 Q3'22 $(38) $125 Q4'22 $(47) YOY Change FREE CASH FLOW¹ $52 Q3'21 174% $161 Q4'21 333% $106 Q1'22 (16)% $(147) FREE CASH FLOW WAS $78 MILLION IN Q4 2022 SECOND CONSECUTIVE FULL YEAR OF POSITIVE FREE CASH FLOW Q2'22 (27)% 'Free Cash Flow is a non-GAAP measure, which we define as net cash provided by (used in) operating activities, reduced by purchases of property and equipment. See Appendix for reconciliation of net cash provided by (used in) operating activities to Free Cash Flow. Numbers throughout presentation may not foot due to rounding. $18 Q3'22 (65)% $78 Q4'22 (51)% 13#14Full Year Summary#15Full Year Financial Summary Revenue Operating Performance Cash ● Operating margin was (30) % in 2022, compared to (17)% in 2021. Adjusted gross margin² improved to 62% in 2022, compared to 58% in 2021. • Net loss was $1,430 million in 2022, including restructuring charges of $189 million, compared to $488 million in 2021. • Adjusted EBITDA³ was $378 million in 2022, compared to $617 million in 2021. • Adjusted EBITDA margin³ was 8% in 2022, compared to 15% in 2021. ● Revenue increased 12% YoY to $4.6 billion in 2022. Average revenue per user¹ was $12.98 in 2022 compared to $13.65 in 2021. ● Operating cash flow was $185 million in 2022, compared to $293 million in 2021. • Free Cash Flow³ was $55 million in 2022, compared to $223 million in 2021. Cash, cash equivalents, and marketable securities were $3.9 billion as of December 31, 2022. ● ARPU is presented as an annual ARPU, calculated as the sum of each reported quarterly Global ARPU. 2Adjusted gross margin is a non-GAAP measure, which we define as GAAP revenue less adjusted cost of revenue, divided by GAAP revenue. Adjusted cost of revenue is a non-GAAP measure and excludes stock-based compensation expense, payroll and other tax expense related to stock-based compensation, depreciation and amortization, and certain other non-cash or non-recurring items impacting net income (loss) from time to time. ³Adjusted EBITDA margin is a non-GAAP measure, which we define as Adjusted EBITDA divided by GAAP revenue. See Appendix for reconciliations of net loss to Adjusted EBITDA and net cash provided by (used in) operating activities to Free Cash Flow.. Numbers throughout presentation may not foot due to rounding. 2022 REVENUE INCREASED 12% YoY TO $4.6 BILLION FREE CASH FLOW WAS $55 MILLION IN 2022 15#16YOY Change Revenue and Average Daily Active Users (DAU)¹ (in millions, unaudited) REVENUE $1,180 2018 43% $1,716 2019 45% ~ 4x growth in revenue $2,507 2020 46% $4,117 2021 64% $4,602 2022 12% YOY Change AVERAGE DAILY ACTIVE USERS¹ 186 Q4'18 -% 218 Q4'19 17% ~2x growth in DAU REVENUE INCREASED 12% YoY TO $4.6 BILLION DAU INCREASED 17% YoY TO 375 MILLION 265 Q4'20 22% 319 Q4'21 20% 375 Q4'22 17% 'We define a Daily Active User, or DAU, as a registered Snapchat user who opens the Snapchat application at least once during a defined 24-hour period. We calculate average Daily Active Users for a particular quarter by adding the number of DAUS on each day of that quarter and dividing that sum by the number of days in that quarter. Numbers throughout presentation may not foot due to rounding. 16#17GAAP Gross Margin Adjusted Gross Margin and Adjusted Gross Profit'¹ (dollars in millions, unaudited) ADJUSTED GROSS MARGIN¹ 35% 2018 32% 49% 2019 48% 27 PPT margin expansion 54% 2020 53% 58% 2021 57% 62% 2022 61% GAAP Gross Profit ADJUSTED GROSS PROFIT¹ $413 2018 $382 $848 2019 ~7x growth in gross profit $820 $1,357 2020 $1,324 $2,405 FROM 2018 TO 2022, ADJUSTED GROSS MARGIN IMPROVED 27 PPT TO 62% 2021 $2,367 $2,837 2022 $2,787 'Adjusted gross margin is a non-GAAP measure, which we define as adjusted gross profit divided by GAAP revenue. Adjusted gross profit is a non-GAAP measure, which we define as GAAP revenue less adjusted cost of revenue. Adjusted cost of revenue is a non-GAAP measure and excludes stock-based compensation expense, payroll and other tax expense related to stock-based compensation, depreciation and amortization, and certain other non-cash or non-recurring items impacting net income (loss) from time to time. In 2022, non-recurring items included restructuring charges of $21 million. See Appendix for further detail. Numbers throughout presentation may not foot due to rounding. 17#18Net Loss & Adjusted EBITDA¹ (in millions, unaudited) NET LOSS $(1,256) 2018 $(1,034) 2019 $(945) 2020 $(488) 2021 $(1,430) 2022 ADJUSTED EBITDA¹ $(576) 2018 $(202) 2019 $45 2020 $617 THIRD CONSECUTIVE FULL YEAR OF ADJUSTED EBITDA PROFITABILITY 2021 $378 2022 'Adjusted EBITDA is a non-GAAP measure, which we define as net income (loss), excluding interest income; interest expense; other income (expense), net; income tax benefit (expense); depreciation and amortization; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; and certain other non-cash or non-recurring items impacting net income (loss) from time to time. In 2022, non-recurring items included restructuring charges of $189 million. See Appendix for reconciliation of net loss to Adjusted EBITDA. Numbers throughout presentation may not foot due to rounding. 18#19Capex Operating Cash Flow and Free Cash Flow¹ (in millions, unaudited) OPERATING CASH FLOW $(690) 2018 $(120) $(305) 2019 $(36) $(168) 2020 $(58) $293 2021 $(70) $185 2022 $(129) FREE CASH FLOW¹ $(810) 2018 $(341) 2019 $(225) 2020 $223 SECOND CONSECUTIVE FULL YEAR OF POSITIVE FREE CASH FLOW FULL YEAR 2022 FREE CASH FLOW OF $55 MILLION 2021 $55 2022 'Free Cash Flow is a non-GAAP measure, which we define as net cash provided by (used in) operating activities, reduced by purchases of property and equipment. See Appendix for reconciliation of net cash provided by (used in) operating activities to Free Cash Flow. Operating Cash Flow and Free Cash Flow in 2022 include $86 million cash paid for restructuring activities. Operating Cash Flow and Free Cash Flow in 2020 include a $98 million payment for a non-recurring legal settlement related to a securities class action, accrued in 2019. Numbers throughout presentation may not foot due to rounding. 19#20Financial Guidance Given uncertainties related to the operating environment, we are not providing our expectations for revenue or adjusted EBITDA for the first quarter of 2023. 20#21Appendix#22Non-GAAP Financial Measures Reconciliation - - Quarterly (in thousands, unaudited) Adjusted EBITDA Reconciliation Net income (loss) Add (deduct): Interest income Interest expense Other (income) expense, net Income tax (benefit) expense Depreciation and amortization Stock-based compensation expense Payroll and other tax expense related to stock-based compensation Restructuring charges¹ Adjusted EBITDA² Free Cash Flow Reconciliation Net cash provided by (used in) operating activities Less: Purchases of property and equipment Free Cash Flow³ September 30, 2021 $ $ $ (71,959) $ (1,257) 4,031 (112,631) 992 32,510 300,898 21,615 September 30, 2021 174,199 71,552 $ $ $ (19,836) 51,716 $ December 31, 2021 22,550 (1,554) 4,050 (63,204) 13,031 34,863 297,564 19,493 326,793 December 31, 2021 185,528 $ $ $ (24,565) 160,963 $ Three Months Ended June 30, 2022 March 31, 2022 (359,624) (3,123) 5,173 77,537 8,510 38,100 275,444 22,451 64,468 $ $ Three Months Ended March 31, 2022 127,459 $ (21,175) 106,284 $ (422,067) (8,331) 5,549 16,910 6,999 79,291 318,810 10,029 7,190 June 30, 2022 September 30, 2022 $ $ (124,081) $ (359,502) (23,370) (147,451) $ (18,445) 5,425 (71,961) 9,241 34,068 312,690 September 30, 2022 6,561 154,563 72,640 55,945 (37,836) 18,109 $ $ $ December 31, 2022 $ (288,460) (28,698) 5,312 20,043 4,206 34,975 446,339 5,172 34,386 233,275 December 31, 2022 125,291 (46,925) 78,366 'Restructuring charges were composed primarily of severance and related charges of $91 million and $6 million in Q3 2022 and Q4 2022, respectively, stock-based compensation expense, lease exit and related charges, impairment charges, contract termination charges, and intangible asset amortization. These charges are non-recurring and not reflective of underlying trends in our business. 2Adjusted EBITDA is a non-GAAP measure, which we define as net income (loss), excluding interest income; interest expense; other income (expense), net; income tax benefit (expense); depreciation and amortization; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; and certain other non-cash or non-recurring items impacting net income (loss) from time to time. ³Free Cash Flow is a non-GAAP measure, which we define as net cash provided by (used in) operating activities, reduced by purchases of property and equipment. Numbers throughout presentation may not foot due to rounding. 1#23Non-GAAP Financial Measures Reconciliation - - Quarterly (in thousands, unaudited) Non-GAAP net income (loss) reconciliation Net income (loss) Amortization of intangible assets Stock-based compensation expense Payroll and other tax expense related to stock-based compensation Restructuring charges¹ Income tax adjustments Non-GAAP net income (loss)² Weighted-average common shares - Diluted³ Non-GAAP diluted net income (loss) per share reconciliation GAAP diluted net income (loss) per share Non-GAAP adjustment to net income (loss) Non-GAAP diluted net income (loss) per share² September 30, 2021 $ $ $ (71,959) $ 18,148 300,898 $ 21,615 (208) 268,494 $ September 30, 2021 1,580,966 (0.05) 0.22 0.17 $ $ December 31, 2021 22,550 20,228 297,564 19,493 (374) 359,461 1,668,879 December 31, 2021 0.01 0.21 0.22 $ $ $ $ Three Months Ended June 30, 2022 March 31, 2022 (359,624) 22,505 275,444 22,451 (61) (39,285) $ 1,619,113 $ Three Months Ended March 31, 2022 (0.22) $ 0.20 (0.02) $ (422,067) 64,134 318,810 10,029 1,632,140 September 30, 2022 (504) (29,598) $ June 30, 2022 $ $ (359,502) 18,701 312,690 (0.26) 0.24 (0.02) $ September 30, 2022 6,561 154,563 (954) 132,059 $ 1,608,523 $ (0.22) 0.30 0.08 $ $ December 31, 2022 (288,460) 18,073 446,339 5,172 34,386 (988) 214,522 1,573,883 December 31, 2022 (0.18) 0.32 0.14 'Restructuring charges were composed primarily of severance and related charges of $91 million and $6 million in Q3 2022 and Q4 2022, respectively, stock-based compensation expense, lease exit and related charges, impairment charges, contract termination charges, and intangible asset amortization. These charges are non-recurring and not reflective of underlying trends in our business. "We define Non-GAAP net income (loss) as net income (loss); excluding amortization of intangible assets; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; certain other non-cash or non-recurring items impacting net income (loss) from time to time; and related income tax adjustments. Non-GAAP net income (loss) and weighted average diluted shares are then used to calculate Non-GAAP diluted net income (loss) per share. ³For all periods except Q4 2021, weighted average shares used in computation of diluted EPS primarily excluded unvested or unexercised stock-based awards, Convertible Notes, and Capped Call shares as they were anti-dilutive. In Q4 2021, weighted average common shares used in computation of diluted EPS excludes Convertible Notes and Capped Call shares as they are anti-dilutive. Numbers throughout presentation may not foot due to rounding. 2#24Non-GAAP Financial Measures Reconciliation - Annual (in thousands, unaudited) Adjusted EBITDA Reconciliation Net income (loss) Add (deduct): Interest income Interest expense Other (income) expense, net Income tax (benefit) expense Depreciation and amortization Stock-based compensation expense Payroll and other tax expense related to stock-based compensation Securities class actions legal charges¹ Reduction in force¹ Lease exit charges¹ Restructuring charges² Adjusted EBITDA³ Free Cash Flow Reconciliation Net cash provided by (used in) operating activities Less: Purchases of property and equipment Free Cash Flow $ $ $ $ 2018 (1,255,911) (27,228) 3,894 8,248 2,547 91,648 538,211 21,927 2018 9,884 31,143 (575,637) $ (689,924) $ (120,242) (810,166) $ 2019 (1,033,660) $ (36,042) 24,994 (59,013) 393 87,245 686,013 2019 27,840 100,000 (202,230) $ (304,958) $ (36,478) (341,436) $ Year Ended 2020 (944,839) (18,127) 97,228 (14,988) 18,654 86,744 770,182 2020 50,309 45,163 Year Ended $ $ (167,644) $ (57,832) (225,476) $ 2021 (487,955) $ (5,199) 17,676 (240,175) 13,584 119,141 1,092,135 107,479 2021 616,686 $ 292,880 $ (69,875) 223,005 $ 2022 (1,429,653) (58,597) 21,459 42,529 28,956 186,434 1,353,283 2022 44,213 188,949 377,573 184,614 (129,306) 55,308 ¹'Securities class actions legal charges related to a preliminary agreement to settle the securities class actions that arose following our IPO. Charges recorded are net of amounts directly covered by insurance. These and other charges relating to reduction in force and lease exit charges in prior years are non- recurring and not reflective of underlying trends i our business. ²Restructuring charges in 2022 were composed primarily of severance and related charges of $97 million, stock-based compensation expense, lease exit and related charges, impairment charges, contract termination charges, and intangible asset amortization. These charges are non-recurring and not reflective of underlying trends in our business. ³Adjusted EBITDA is a non-GAAP measure, which we define as net income (loss), excluding interest income; interest expense; other income (expense), net; income tax benefit (expense); depreciation and amortization; stock-based compensation expense; payroll and other tax expense related to stock-based compensation; and certain other non-cash or non-recurring items impacting net income (loss) from time to time. *Free Cash Flow is a non-GAAP measure, which we define as net cash provided by (used in) operating activities, reduced by purchases of property and equipment. Numbers throughout presentation may not foot due to rounding. 3#25Note Regarding User Metrics and Other Data We define a Daily Active User, or DAU, as a registered Snapchat user who opens the Snapchat application at least once during a defined 24-hour period. We calculate average DAUs for a particular quarter by adding the number of DAUs on each day of that quarter and dividing that sum by the number of days in that quarter. DAUs are broken out by geography because markets have different characteristics. We define average revenue per user, or ARPU, as quarterly revenue divided by the average DAUs. For purposes of calculating ARPU, revenue by user geography is apportioned to each region based on our determination of the geographic location in which advertising impressions are delivered, as this approximates revenue based on user activity. This allocation differs from our components of revenue disclosure in the notes to our consolidated financial statements, where revenue is based on the billing address of the advertising customer. Unless otherwise stated, statistical information regarding our users and their activities is determined by calculating the daily average of the selected activity for the most recently completed quarter. While these metrics are determined based on what we believe to be reasonable estimates of our user base for the applicable period of measurement, there are inherent challenges in measuring how our products are used across large populations globally. For example, there may be individuals who have unauthorized or multiple Snapchat accounts, even though we forbid that in our Terms of Service and implement measures to detect and suppress that behavior. We have not determined the number of such multiple accounts. Changes in our products, infrastructure, mobile operating systems, or metric tracking system, or the introduction of new products, may impact our ability to accurately determine active users or other metrics and we may not determine such inaccuracies promptly. We also believe that we don't capture all data regarding each of our active users. Technical issues may result in data not being recorded from every user's application. For example, because some Snapchat features can be used without internet connectivity, we may not count a DAU because we don't receive timely notice that a user has opened the Snapchat application. This undercounting may increase as we grow in Rest of World markets where users may have poor connectivity. We do not adjust our reported metrics to reflect this underreporting. We believe that we have adequate controls to collect user metrics, however, there is no uniform industry standard. We continually seek to identify these technical issues and improve both our accuracy and precision, including ensuring that our investors and others can understand the factors impacting our business, but these technical issues and new issues may continue in the future, including if there continues to be no uniform industry standard. Some of our demographic data may be incomplete or inaccurate. For example, because users self-report their dates of birth, our age-demographic data may differ from our users' actual ages. And because users who signed up for Snapchat before June 2013 were not asked to supply their date of birth, we may exclude those users from our age demographics or estimate their ages based on a sample of the self-reported ages that we do have. If our active users provide us with incorrect or incomplete information regarding their age or other attributes, then our estimates may prove inaccurate and fail to meet investor expectations. 4#26Note Regarding User Metrics and Other Data (Continued) In the past we have relied on third-party analytics providers to calculate our metrics, but today we rely primarily on our analytics platform that we developed and operate. We count a DAU only when a user opens the application and only once per user per day. We believe this methodology more accurately measures our user engagement. We have multiple pipelines of user data that we use to determine whether a user has opened the application during a particular day, and becoming a DAU. This provides redundancy in the event one pipeline of data were to become unavailable for technical reasons, and also gives us redundant data to help measure how users interact with our application. If we fail to maintain an effective analytics platform, our metrics calculations may be inaccurate. We regularly review, have adjusted in the past, and are likely in the future to adjust our processes for calculating our internal metrics to improve their accuracy. As a result of such adjustments, our DAUS or other metrics may not be comparable to those in prior periods. Our measures of DAUS may differ from estimates published by third parties or from similarly titled metrics of our competitors due to differences in methodology or data used. 5