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Snap says it collects $ 1 billion in convertible debt



Snap co-founder and CEO Evan Spiegel speaks at code conference 2018 May 29, 2018.

Asa Mathat | Vox Media

Snap said Tuesday that it will raise $ 1 billion in debt. Shares of Snap were a bit up in early trading.

The company, which is the maker of Snapchat, said it offers $ 1 billion in convertible senior notes due August 1, 2026.

Snap said it will use dividends to cover operating expenses related to operating the business. It said the proceeds could also be used to "acquire complementary businesses, products, services or technologies or to repurchase Snap's common stock."

In October of last year, Snap CEO Evan Spiegel detailed the company's goal of achieving profitability this year in a memo sent to employees. Spiegel said it was a "stretch target" to level out in the fourth quarter of 201

8 and become profitable in 2019. Cheddar first reported the contents of the note.

The move comes when Snap recently reported second-quarter results that rose high past analysts' estimates. The company had a narrower loss than expected for the quarter and reported the second quarter in a row of user growth.


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