Snap Inc Results Presentation Deck
Note 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 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. We also break out Daily
Active Users by geography because certain markets have a greater revenue opportunity and lower bandwidth costs. 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 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. Our user metrics are also affected by
technology on certain mobile devices that automatically runs in the background of our Snapchat application when another phone function is used, and this activity can cause our system
to miscount the user metrics associated with such account. 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 believe that we don't capture all data
regarding all our active users. For example, technical issues may result in data not being recorded from every user's application. While we believe this underreporting is generally
immaterial, we are unable to precisely determine the level of underreporting and for some periods the underreporting may be material. We continually seek to address these technical
issues and improve our accuracy, but given the complexity of the systems involved and the rapidly changing nature of mobile devices and systems, we expect underreporting to
continue. We do not adjust our reported metrics to reflect this underreporting.
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 exclude those users and estimate their ages based on a sample
of the self-reported ages we do have. If our DAUS 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.
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