Q4 2022 Q4 2021
Cost of revenue 481,311 449,151
Research and development 584,942 434,195
Sales and marketing 295,150 245,228
General and administrative 225,929 194,438
Total costs and expenses 1,587,332 1,323,012
(Revenue is up 0.1%, by the way. That 2% is doing as if exchange rates had not moved.)
You can’t really look at numbers like that to paint a full picture.
Net income in particular is sensitive to one time events.
In this case, imo, it looks like the most important story is that revenue per user is falling hard. 17% more users. -15% revenue per user. Revenues are falling in North America and they have to try and make up for it by targeting the rest of the world.
FCF is a poor metric to use for RSU/option heavy tech companies.
Stock based comp directly dilutes shareholders, and using FCF hides the profitability hole that SBC creates for many of these companies.
FCF is more relevant for companies where net income adjustments are largely one time or moreso accounting gimmicky (depreciating real estate/assets to show a GAAP loss etc). SBC dilution is very real
This. SNAP has been a publicly traded company for 6 years, one cannot just ignore and hand wave away this expense, especially given how much growth prospects have deteriorated.
