SNAP raises $550M, uses proceeds to repurchase convertible notes

Rhea-AI Filing Summary

Snap Inc. entered into a private placement to sell an aggregate of $550.0 million principal amount of 6.875% Senior Notes due 2034. The notes pay cash interest semi-annually beginning March 15, 2026, and mature March 15, 2034. Net proceeds are estimated at approximately $541.3 million.

The net proceeds, together with cash on hand, were used to repurchase portions of the company’s outstanding convertible debt: approximately $157.4 million principal of 2026 Notes, $246.3 million principal of 2027 Notes and $185.8 million principal of 2028 Notes, for an aggregate cash repurchase price of about $550.1 million. These repurchases settled on or about August 12, 2025.

The Indenture for the new notes contains customary covenants and events of default, including limitations on liens, subsidiary guarantees and certain merger or asset-sale transactions. The notes are redeemable prior to September 15, 2028 at a 100% redemption price plus a make-whole premium, and up to 40% of the original principal may be redeemed with certain equity offering proceeds at 106.875% until that date.

Positive

• $550.0 million 6.875% Senior Notes issued, providing material new financing
• Estimated net proceeds of approximately $541.3 million to support corporate actions
• Repurchased approximately $157.4M, $246.3M, and $185.8M principal of 2026, 2027 and 2028 convertibles, respectively, reducing outstanding convertible principal

Negative

• New senior unsecured notes carry a fixed 6.875% cash interest obligation, increasing recurring interest expense
• Indenture includes customary covenants and events of default (including judgment and indebtedness thresholds of $150.0 million) that could accelerate repayment in specified circumstances
• Redemption features include a make-whole premium and an equity-financing redemption price of 106.875% for up to 40% of original principal until September 15, 2028

Insights

Credit Analyst

TL;DR: Snap issued $550M of senior unsecured debt at 6.875%, increasing fixed interest obligations while extending debt maturity to 2034.

The offering raises approximately $541.3M net, replacing convertible liabilities through repurchases. From a credit perspective, the company has shifted variable or low-coupon convertible instruments into a fixed-rate senior unsecured obligation, which increases predictable cash interest outflows. The Indenture includes standard default triggers and covenants; judgment and indebtedness thresholds of $150.0M may be relevant for acceleration risk. Overall impact on leverage metrics will depend on how much cash was used versus remaining liquidity, which is not quantified here.

Capital Markets Specialist

TL;DR: The transaction materially reduces outstanding convertible principal and provides dedicated financing to fund repurchases.

The company repurchased approximately $589.5M aggregate principal of convertible notes for roughly $550.1M cash, funded primarily by the new note proceeds and cash on hand. That reduces outstanding convertible principal balances and simplifies the capital structure by removing multiple convertible instruments. The notes’ redemption provisions and customary restrictive covenants maintain standard issuer flexibility and creditor protections. This is a material capital-structure action for investors to note.

Snap Inc false 0001564408 0001564408 2025-08-07 2025-08-07

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 12, 2025 (August 7, 2025)

SNAP INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware		001-38017		45-5452795
(State or Other Jurisdiction		(Commission		(IRS Employer
of Incorporation)		File Number)		Identification No.)

3000 31st Street
Santa Monica, California		90405
(Address of Principal Executive Offices)		(Zip Code)

(310) 399-3339

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A Common Stock, par value $0.00001 per share		SNAP		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Explanatory Note

Purchase Agreement

On August 7, 2025, we entered into a purchase agreement (the “Purchase Agreement”) with Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC, as representatives of the several purchasers named therein (collectively, the “Initial Purchasers”), relating to the sale by us of an aggregate of $550.0 million principal amount of our 6.875% Senior Notes due 2034 (the “Notes”) in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Pursuant to the terms of the Purchase Agreement, the parties have agreed to indemnify each other against certain liabilities, including certain liabilities under the Securities Act.

Item 1.01 Entry into a Material Definitive Agreement

Indenture and Notes

The Notes were issued pursuant to an Indenture, dated August 12, 2025 (the “Indenture”), between us and U.S. Bank Trust Company, National Association, as trustee (“Trustee”). The Notes are our senior unsecured obligations. The Notes will bear interest at a rate of 6.875% per year, payable in cash semi-annually in arrears on March 15 and September 15 of each year, beginning on March 15, 2026. The Notes mature on March 15, 2034 unless repurchased or redeemed in accordance with their terms prior to such date.

We estimate that the net proceeds, after deducting the Initial Purchasers’ discounts and commissions and estimated expenses payable by us, will be approximately $541.3 million. The net proceeds from the offering, together with cash on hand, were used for the Repurchases (as defined in Item 8.01 of this Current Report on Form 8-K).

We may redeem for cash all or any portion of the Notes, at our option, at any time prior to September 15, 2028 at a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus any accrued and unpaid interest to, but excluding, the redemption date and a “make-whole” premium as provided in the Indenture. Furthermore, until September 15, 2028, we may redeem up to 40% of the original aggregate principal amount of the Notes with the net cash proceeds of certain equity offerings at a redemption price of 106.875% of the principal amount of the Notes to be redeemed plus any accrued and unpaid interest to, but excluding the redemption date. In addition, we may redeem all or any portion of the Notes at any time on or after September 15, 2028 at the redemption prices set forth in the Indenture, plus any accrued and unpaid interest to, but excluding, the redemption date.

The Indenture includes customary terms and covenants, including certain events of default after which the Notes may be due and payable immediately. The following events are considered “events of default,” which may result in acceleration of the maturity of the Notes:

(1) default by us in any payment of interest on any Note when due and payable and the default continues for a period of 30 days;

(2) default by us in the payment of principal of, or premium, if any, on any Note when due and payable at its stated maturity, upon optional redemption, upon any required repurchase, upon acceleration, or otherwise;

(3) failure by us or any guarantor (as defined in the Indenture) for 60 days after written notice has been received from either the Trustee or the holders of at least 30% in aggregate principal amount of the Notes then outstanding to comply with any agreement or obligation contained in the Indenture provided, that, in the case of a failure to comply with the reporting covenant, such period of continuance of such default or breach shall be 180 days after written notice;

(4) default by us or any of our significant subsidiaries (as defined in the Indenture) with respect to any mortgage, indenture, or other instrument under which there may be issued, or by which there may be secured or evidenced, any indebtedness for money borrowed in excess of $150.0 million (or its foreign currency equivalent) in the aggregate of us and any such subsidiary (i) which is caused by a failure to pay the principal of such indebtedness at its stated final maturity or (ii) resulting in the acceleration of such indebtedness prior to its stated final maturity;

(5) certain events of bankruptcy, insolvency, or court protection of us or any of our significant subsidiaries;

(6) failure by us or any of our significant subsidiaries to pay final judgments (other than those covered by indemnities provided by, or insurance policies issued by, reputable and creditworthy companies) aggregating in excess of $150.0 million for a period of more than 60 days after such judgment becomes final; or

(7) default by a significant subsidiary on any note guarantee (as defined in the Indenture), other than those in accordance with the terms of the Indenture or those in connection with the bankruptcy of a guarantor whose aggregate assets, together with the aggregate assets of any other guarantor whose note guarantee ceased or ceases to be in full force as a result of a bankruptcy, are less than $100.0 million.

If we experience certain change of control events, as described in the Indenture, we will be required to make an offer to repurchase some or all of the Notes at a price equal to 101% of the principal amount of the Notes to be repurchased plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The Indenture contains restrictive covenants relating to limitations: (i) on our and any guarantor’s ability to create liens on certain assets to secure debt; (ii) on our and any of our domestic subsidiaries’ ability to grant a subsidiary guarantee of certain debt without also providing a guarantee of the Notes; and (iii) on our and any guarantor’s ability to consolidate or merge with or into, or sell or otherwise dispose of all or substantially all of our assets to another person, subject, in each case, to certain exceptions. These covenants are subject to a number of other limitations and exceptions set forth in the Indenture.

A copy of the Indenture and form of Global Note are filed as Exhibit 4.1 and Exhibit 4.2, respectively, to this Current Report on Form 8-K and are incorporated by reference into this Item 1.01. The foregoing description of the Indenture and the Notes does not purport to be complete and is qualified in its entirety by reference to such exhibits.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The information set forth under “Indenture and Notes” under Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.

Item 8.01. Other Events.

On August 7, 2025, we entered into various repurchase transactions (collectively, the “Repurchases”) with certain holders of our outstanding 0.75% Convertible Senior Notes due 2026 (the “2026 Notes”), 0.00% Convertible Senior Notes due 2027 (the “2027 Notes”), and 0.125% Convertible Senior Notes due 2028 (the “2028 Notes”), in privately negotiated transactions, pursuant to which we repurchased approximately $157.4 million aggregate principal amount of the 2026 Notes, approximately $246.3 million aggregate principal amount of the 2027 Notes, and approximately $185.8 million aggregate principal amount of the 2028 Notes, for an aggregate cash repurchase price of approximately $550.1 million. The transactions settled on or about August 12, 2025.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

Exhibit No.		Description
4.1		Indenture, dated August 12, 2025, by and between Snap Inc. and U.S. Bank Trust Company , National Association, as Trustee.
4.2		Form of Global Note, representing Snap Inc.’s 6.875% Senior Notes due 2034 (included as Exhibit A to the Indenture filed as Exhibit 4.1).
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

				SNAP INC.
August 12, 2025				By:		/s/ Derek Andersen
						Derek Andersen
						Chief Financial Officer

FAQ

What did Snap (SNAP) issue in this filing?

Snap issued an aggregate of $550.0 million principal amount of 6.875% Senior Notes due 2034 in a private Rule 144A offering.

How will Snap use the proceeds from the senior notes?

The company estimates net proceeds of about $541.3 million, which, together with cash on hand, were used to repurchase outstanding convertible notes in privately negotiated transactions.

What convertible notes were repurchased by Snap and for how much?

Snap repurchased approximately $157.4M principal of 2026 Notes, $246.3M principal of 2027 Notes, and $185.8M principal of 2028 Notes for an aggregate cash repurchase price of about $550.1 million.

When do the new senior notes mature and when is interest payable?

The notes mature on March 15, 2034, with cash interest at 6.875% payable semi‑annually on March 15 and September 15, beginning March 15, 2026.

What are key redemption and covenant features of the notes?

Prior to September 15, 2028 Snap may redeem notes at 100% of principal plus a make‑whole premium; up to 40% may be redeemed with certain equity offering proceeds at 106.875%. The Indenture includes customary limits on liens, subsidiary guarantees and certain corporate transactions.

Are the Indenture and note forms filed as exhibits?

Yes. The Indenture and form of Global Note are filed as Exhibit 4.1 and Exhibit 4.2, and the Cover Page Interactive Data File is filed as Exhibit 104.