What changed in this filing

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Item 1A. Risk Factors

2020-07-22 compared with 2020-04-22 · 67 added, 52 removed, 892 unchanged (12% of the section changed)

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If we fail to retain current users or add new users, or if our users engage less with Snapchat, our business would be seriously harmed.

We had 229 million DAUs on average in the quarter ended March 31, 2020.

We had 238 million DAUs on average in the quarter ended June 30, 2020.

We view DAUs as a critical measure of our user engagement, and adding, maintaining, and engaging DAUs have been and will continue to be necessary.

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we fail to provide adequate service to users, advertisers, or partners;

we do not provide a compelling user experience to entice users to use the Snapchat application on a daily basis;

we do not provide a compelling user experience to entice users to use the Snapchat application on a daily basis, or our users don’t have the ability to make new friends to maximize the user experience;

we, our partners, or other companies in our industry segment are the subject of adverse media reports or other negative publicity, some of which may be inaccurate or include confidential information that we are unable to correct or retract;

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As our business continues to develop, including globally, there may be new or existing advertisers or resellers, or advertisers or resellers from different geographic regions that contribute more significantly to our total revenue.

For example, greater China represented more than 10% of our revenue for the three months ended September 30, 2019.

Any economic or political instability in a specific country or region may negatively impact our customers and their budgets with us, and our business would be seriously harmed.

For example, greater China represented more than 10% of our revenue for the three months ended June 30, 20 20 .

Any economic or political instability , whether as a result of the COVID-19 pandemic or otherwise, in a specific country or region may negatively impact the global economy, advertising ecosystem, industry, or our customers and their budgets with us, and our business would be seriously harmed.

Moreover, we rely heavily on our ability to collect and disclose data and metrics to and for our advertisers to attract new advertisers and retain existing advertisers.

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Other state and federal legislative and regulatory bodies are considering similar legislation on how to handle personal data.

Such restrictions could have an adverse effect on our ability to target and measure ads, and could reduce the demand or the pricing for our advertising products.

Such adverse effects could be particularly material to us because we are still early in building our advertising business.

Furthermore, changes to iOS or Android operating systems’ practices and policies, such as Apple’s upcoming iOS update that may impose heightened restrictions on our access and use of user data, may reduce the quantity and quality of the data and metrics that can be collected or used by us and our partners, and adversely affect our ability to effectively target advertisements to users and demonstrate the value of our advertisements to advertisers, any of which could reduce the demand and pricing for our advertising products and seriously harm our business.

The impact of these proposed changes on the overall mobile advertising ecosystem, our business, and the developers, partners, and advertisers within our community is uncertain depending on how these changes are implemented, how we and the overall mobile advertising ecosystem adjusts, and how our partners, advertisers, and users respond, could seriously harm our business.

Any adverse effects could be particularly material to us because we are still early in building our advertising business.

Our advertising revenue could be seriously harmed by many other factors, including:

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decreases in the perceived quantity, quality, usefulness, or relevance of the content provided by our users or partners;

changes in our analytics and measurement solutions that demonstrate the value of our advertisements and other commercial content;

changes in our analytics and measurement solutions, including what we are permitted to collect and disclose under the terms of Apple’s and Google’s mobile operating system, that demonstrate the value of our advertisements and other commercial content;

competitive developments or advertiser perception of the value of our products that change the rates we can charge for advertising or the volume of advertising on Snapchat;

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our inability to measure the effectiveness of our advertising or target the appropriate audience for advertisements;

our inability to collect and disclose data that new and existing advertisers may find useful;

our inability to collect and disclose data or access a user’s Identifier for Advertising or similar deterministic identifier that new and existing advertisers may find useful;

difficulty and frustration from advertisers who may need to reformat or change their advertisements to comply with our guidelines;

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Our two co-founders have control over all stockholder decisions because they control a substantial majority of our voting stock.

Our two co-founders, Evan Spiegel and Robert Murphy, own or control voting shares of our capital stock that represent approximately 99% of the voting power of our outstanding capital stock as of March 31, 2020.

Spiegel alone can exercise voting control over a majority of our voting power.

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Murphy are entitled to vote their shares, and shares over which they have voting control, in their own interests, which may not always be in the interests of our stockholders generally.

We have not elected to take advantage of the “controlled company” exemption to the corporate governance rules for companies listed on the New York Stock Exchange, or NYSE.

We have not elected to take advantage of

the “controlled company” exemption to the corporate governance rules for companies listed on the New York Stock Exchange, or NYSE.

Health epidemics, including the recent COVID-19 pandemic, have had, and could in the future have, an adverse impact on our business, operations, and the markets and communities in which we and our partners, advertisers, and users operate.

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The ongoing global COVID-19 pandemic has adversely impacted, and may continue to adversely impact, many aspects of our business.

As certain of our advertisers experience downturns or uncertainty in their own business operations and revenue because of the economic effects resulting from the spread of COVID-19, they have and may continue to decrease their advertising spending and may focus their advertising spending more on other platforms, both of which may result in decreased advertising revenue.

Furthermore, a portion of our advertising revenue is related to in-person events, such as sporting events, music festivals, and the Olympics, that have been or may be postponed or cancelled.

As certain of our advertisers experience downturns or uncertainty in their own business operations and revenue because of the economic effects, including resulting from the spread of COVID-19, they have and may halt, whether temporary or permanently, or continue to decrease their advertising spending and may focus their advertising spending more on other platforms, all of which may result in decreased advertising revenue.

We may also experience difficulty forecasting advertising revenue from our partners on our platform.

Furthermore, a portion of our advertising revenue is related to in-person events or activities, such as sporting events, music festivals, the Olympics, and in-person learning that have been or may be postponed or cancelled.

A decline in advertising revenue or the collectability of our receivables could seriously harm our business.

The COVID-19 pandemic has been declared a national emergency.

In response to the COVID-19 pandemic, many state, local, and foreign governments have put in place, and others in the future may put in place, quarantines, executive orders, shelter-in-place orders, and similar government orders and restrictions in order to control the spread of the disease.

The COVID-19 pandemic has been declared a global emergency.

In response to the COVID-19 pandemic, many state, local, and foreign governments have put in place, and others in the future may put in place, quarantines, executive orders, shelter-in-place orders, physical distancing requirements, and similar government orders and restrictions in order to control the spread of the disease.

Such orders or restrictions, or the perception that such orders or restrictions could occur, have resulted in business closures, work stoppages, slowdowns and delays, work-from-home policies, travel restrictions, and cancellation or postponement of events, among other effects that could negatively impact productivity and disrupt our operations and those of our partners, advertisers, and users.

We have implemented a work-from-home policy for substantially all of our employees, and we may take further actions that alter our operations as may be required by federal, state, or local authorities, or which we determine are in our best interests.

We implemented and continue a work-from-home policy for substantially all of our employees, and we may take further actions that alter our operations as may be required by federal, state, or local authorities, or which we determine are in our best interests.

While most of our operations can be performed remotely, there is no guarantee that we will be as effective while working remotely because our team is dispersed, many employees may have additional personal needs to attend to (such as looking after children as a result of school closures or family who become sick), and employees may become sick themselves and be unable to work.

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A decrease in the amount or quality of content available on Snapchat, or an interruption in the services provided to us, could lead to a decline in user engagement, which could seriously harm our business.

In addition, while the potential impact and duration of the COVID-19 pandemic on the global economy and our business in particular may be difficult to assess or predict, the pandemic has resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access capital, which could negatively affect our liquidity in the future.

The global impact of COVID-19 continues to rapidly evolve, and we will continue to monitor the situation closely.

The effects of the COVID-19 pandemic on user engagement are highly uncertain, and may lead to unpredictable results in the short-term and long-term.

As shelter-in-place orders continue or are reactivated, and there are fewer in-person activities, we may experience short-term and long-term disruption to user behavior and our business.

We may also experience inconsistent or negative engagement as user behavior on our platform changes, including changes in user activity as a result of continued shelter-in-place orders.

In addition, while the potential impact and duration of the COVID-19 pandemic on the global economy and our business in particular may be difficult to assess or predict, the COVID-19 pandemic has resulted in, and may continue to result in, significant volatility and disruption of global financial markets, reducing our ability to access capital, which could negatively affect our liquidity in the future.

The global impact of COVID-19 has and continues to rapidly evolve, and we will continue to monitor the situation closely.

The ultimate impact of the COVID-19 pandemic or a similar health epidemic is highly uncertain and subject to change.

We do not yet know the full extent of potential delays or impacts on our business, operations, or the global economy as a whole.

While the spread of COVID-19 may eventually be contained or mitigated, there is no guarantee that a future outbreak of this or any other widespread epidemics will not occur, or that the global economy will recover, either of which could seriously harm our business.

While the spread of COVID-19 may eventually be contained or mitigated, there is no guarantee that a future

outbreak of this or any other widespread epidemics will not occur, or that the global economy will recover, either of which could seriously harm our business.

If we do not develop successful new products or improve existing ones, our business will suffer.

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This ranges from smaller or newer companies to larger more established companies such as Apple, Facebook (including Instagram and WhatsApp), Google (including YouTube), Twitter, Kakao, LINE, Naver (including Snow), Bytedance (including TikTok), and Tencent, which provide their users with a variety of products, services, content, and online advertising offerings, and advertising-supported video on demand platforms (such as Quibi) that offer, or will offer, products and services that may compete with Snapchat features or offerings.

For example, Instagram, a competing application owned by Facebook, has incorporated many of our features, including a “stories” feature that largely mimics our Stories feature and may be directly competitive.

For example, Instagram, a competing application owned by Facebook, has

incorporated many of our features, including a “stories” feature that largely mimics our Stories feature and may be directly competitive.

Facebook has introduced, and likely will continue to introduce, more private ephemeral products into its various platforms which mimic other aspects of Snapchat’s core use case.

We may also lose users to companies that offer products and services that compete with specific Snapchat features because of the low cost for our users

to switch to a different product or service.

We may also lose users to companies that offer products and services that compete with specific Snapchat features because of the low cost for our users to switch to a different product or service.

Moreover, in emerging international markets, where mobile devices often lack large storage capabilities, we may compete with other applications for the limited space available on a user’s mobile device.

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impeding Snapchat’s accessibility and usability by modifying existing hardware and software on which the Snapchat application operates.

Certain acquisitions by our competitors may result in reduced functionality of our products and services, provide our competitors with valuable insight into the performance of our and our partners’ businesses, and provide our competitors with a pipeline of future acquisitions to maintain a dominant position.

As a result, our competitors may acquire and engage users at the expense of our user growth or engagement, which may seriously harm our business.

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We have incurred operating losses in the past, and may never achieve or maintain profitability.

We began commercial operations in 2011 and for all of our history we have experienced net losses and, prior to the quarter ended March 31, 2020, negative cash flows from operations.

As of March 31, 2020, we had an accumulated deficit of $7.3 billion and for the three months ended March 31, 2020, we experienced a net loss of $305.9 million.

We began commercial operations in 2011 and for all of our history we have experienced net losses and, prior to the quarter ended June 30, 2020, negative cash flows from operations.

As of June 30, 2020, we had an accumulated deficit of $7.6 billion and for the three months ended June 30, 2020, we experienced a net loss of $326.0 million.

We expect our operating expenses to increase in the future as we expand our operations.

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As we mature, or if our stock price declines, our equity awards may not be as effective an incentive to attract, retain, and motivate employees.

Additionally, many of our current employees received substantial amounts of our capital stock on or after our IPO, giving them a substantial amount of personal wealth, which can lead to an increase in attrition.

Additionally, many of our current employees received substantial amounts of our capital stock, giving them a substantial amount of personal wealth, which can lead to an increase in attrition.

As a result, it may be difficult for us to continue to retain and motivate these employees, and this wealth could affect their decision about whether they continue to work for us.

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Our efforts to protect the information that our users have shared with us may be unsuccessful due to the actions of third parties, software bugs or other technical malfunctions, employee error or malfeasance, or other factors.

In addition, third parties may attempt to fraudulently induce employees or users to disclose information to gain access to our data or our users’ data.

In addition, third parties may attempt to fraudulently induce employees or users to disclose information to gain access to our data or our users’

If any of these events occur, our or our users’ information could be accessed or disclosed improperly.

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But given the complexity of the systems involved and the rapidly changing nature of mobile devices and systems, we expect these issues to continue, particularly if we continue to expand in parts of the world where mobile data systems and connections are less stable.

If advertisers, partners, or investors do not perceive our user, geographic, or other demographic metrics to be accurate representations of our user base, or if we discover material inaccuracies in our user, geographic, or other demographic metrics, our reputation may be seriously harmed.

If advertisers, partners, or investors do not perceive our user,

geographic, or other demographic metrics to be accurate representations of our user base, or if we discover material inaccuracies in our user, geographic, or other demographic metrics, our reputation may be seriously harmed.

Our advertisers and partners may also be less willing to allocate their budgets or resources to Snapchat, which could seriously harm our business.

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The CCPA also provides for civil penalties for violations, as well as a private right of action for data breaches, which may increase the likelihood and cost of data breach litigation.

The potential effects of this legislation are far-reaching and may require us, our partners, and advertisers to modify data processing practices and policies and to incur substantial costs and expenses in an effort to comply.

The potential effects of this legislation are far-reaching and may require us, our partners, and advertisers to modify data processing practices and

policies and to incur substantial costs and expenses in an effort to comply.

We expect other state and federal legislative and regulatory bodies may enact similar legislation regarding the handling of personal data, or conduct additional investigations into specific companies or the industry as a whole that could alter the existing regulatory environment in a manner that would be adverse to us.

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Historically, our costs have increased each year due to these factors, and we expect to continue to incur increasing costs.

Our costs are based on development and release of new

products and the addition of users and may not be offset by a corresponding growth in our revenue.

Our costs are based on development and release of new products and the addition of users and may not be offset by a corresponding growth in our revenue.

We will continue to invest in our global infrastructure to provide our products quickly and reliably to all users around the world, including in countries where we do not expect significant short-term monetization, if any.

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And because we exercise little control over these providers, we are vulnerable to problems with the services they provide.

In 2020, we began work on the implementation of a new enterprise financial planning and reporting system.

As we plan for and implement such new financial planning system, we may experience difficulties in managing our existing systems and processes, which could disrupt our operations, the management of our finances, and the reporting of our financial results.

Our failure to complete such system implementation on a timely basis, or its failure to operate in the intended manner, may result in our inability to manage the growth of our business and to accurately forecast and report our results, each of which could seriously harm our business.

Our business emphasizes rapid innovation and prioritizes long-term user engagement over short-term financial condition or results of operations.

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We frequently make decisions that may reduce our short-term revenue or profitability if we believe that the decisions benefit the aggregate user experience and will thereby improve our financial performance over the long term.

For example, we monitor how advertising on Snapchat affects our users’ experiences to ensure we do not deliver too many advertisements to our users, and we may decide to decrease the number of advertisements to ensure our users’ satisfaction in the product.

to ensure our users’ satisfaction in the product.

In addition, we improve Snapchat based on feedback provided by our users, advertisers, and partners.

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We also rely on trademark, copyright, patent, trade secret, and domain-name-protection laws to protect our proprietary rights.

In the United States and internationally, we have filed various applications to protect aspects of our intellectual property, and we currently hold a number of issued patents in

multiple jurisdictions.

In the United States and internationally, we have filed various applications to protect aspects of our intellectual property, and we currently hold a number of issued patents in multiple jurisdictions.

In the future, we may acquire additional patents or patent portfolios, which could require significant cash expenditures.

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These issues may eventually lead to layoffs of employees in these markets and may harm our ability to grow our business in these markets.

In addition, scaling our business to international markets imposes complexity on our business, and requires additional financial and management resources.

In addition, scaling our business to international markets imposes complexity on our business, and requires additional financial, legal, and management resources.

We may not be able to manage growth and expansion effectively, which could damage our brand, result in significant costs, and seriously harm our business.

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Our business may not generate sufficient cash flow from operations in the future to service our debt and business.

If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring debt, obtaining additional debt financing, or issuing additional equity securities, any of which may be on terms that are not favorable to us or, in the case of equity securities, highly dilutive to our stockholders.

case of equity securities, highly dilutive to our stockholders.

Our ability to refinance the Convertible Notes or our other indebtedness will depend on various factors, including the available capital markets, our business, and our financial condition at such time.

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In addition, holders of the Convertible Notes will have the right to require us to repurchase all or a portion of the Convertible Notes on the occurrence of a fundamental change at a repurchase price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date.

Further, if a make-whole fundamental change as defined in the Indenture governing the Convertible Notes occurs prior to the maturity date of the Convertible Notes, we will in some cases be required to increase the conversion rate for a holder that elects to convert its Convertible Notes in connection with such make-whole fundamental change.

Further, if a make-whole fundamental change as defined in each of the Indentures governing the Convertible Notes occurs prior to the maturity date of the Convertible Notes, we will in some cases be required to increase the conversion rate for a holder that elects to convert its Convertible Notes in connection with such make-whole fundamental change.

On the conversion of the Convertible Notes, unless we elect to deliver solely shares of our Class A common stock to settle such conversion (other than paying cash in lieu of delivering any fractional share), we will be required to make cash payments for the Convertible Notes being converted.

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District Court for the Central District of California.

The complaint, which seeks injunctive relief among other remedies, alleges that certain Snapchat features infringe several Vaporstream patents.

In March 2020, we and the plaintiffs agreed to settle this matter, and we expect that settlement to become final during the second quarter of 2020 .

The complaint, which sought injunctive relief among other remedies, alleged that certain Snapchat features infringe several Vaporstream patents.

In April 2020, the case was dismissed pursuant to a settlement agreement .

In addition, in April 2018, Blackberry Limited filed a lawsuit against us alleging that we infringe six of its patents.

This lawsuit was recently dismissed after four of the patents were ruled to be invalid;

however, Blackberry Limited has since appealed the ruling to the U.S.

however, Blackberry Limited has appealed the ruling to the U.S.

Court of Appeals for the Federal Circuit.

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However, each of these statutes and doctrines is subject to uncertain judicial interpretation and regulatory and legislative amendments.

For example, Congress amended the CDA in 2018 in ways that could expose some Internet platforms to an increased risk of litigation, and members of Congress proposed further amendments in 2019.

For example, Congress amended the CDA in 2018 in ways that could expose some Internet platforms to an increased risk of litigation, and members of Congress and the Department of Justice proposed further amendments in 2019 and 2020.

Moreover, some of these statutes and doctrines provide protection only or primarily in the United States.

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Goodwill is required to be tested for impairment at least annually.

As of March 31, 2020, we had recorded a total of $840.3 million of goodwill and intangible assets, net related to our acquisitions.

As of June 30, 2020, we had recorded a total of $862.5 million of goodwill and intangible assets, net related to our acquisitions.

An adverse change in market conditions, particularly if such change has the effect of changing one of our critical assumptions or estimates, could result in a change to the estimation of fair value that could result in an impairment charge to our goodwill or intangible assets.

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As a result, all matters submitted to stockholders will be decided by the vote of holders of Class B common stock and Class C common stock.

As of March 31, 2020, Mr.

As of June 30, 2020, Mr.

Spiegel and Mr.

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Shares of Class A common stock were sold in our IPO in March 2017 at a price of $17.00 per share.

Since then, the trading price of our Class A common stock has ranged from $4.82 to $29.44 through March 31, 2020.

Since then, the trading price of our Class A common stock has ranged from $4.82 to $29.44 through June 30, 2020.

For example, as of December 31, 2018, the trading price of our Class A common stock had declined 68% since our IPO in March 2017 but as of December 31, 2019, the trading price of our Class A common stock had increased 196% compared to the trading price on December 31, 2018.

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We may still incur substantially more debt or take other actions that would diminish our ability to make payments on the Convertible Notes when due.

Our ability to repay our debt depends on our future performance, which is subject to economic, financial, competitive, and other factors beyond our control.

We and our subsidiaries may incur substantial additional debt in the future, subject to the restrictions contained in our current and future debt instruments.

We are not restricted under the terms of the Indenture governing the Convertible Notes from incurring additional debt, securing existing or future debt, repurchasing our stock, making investments, paying dividends, recapitalizing our debt, or taking a number of other actions that could have the effect of diminishing our ability to make payments on the Convertible Notes when due.

We are not restricted under the terms of the Indentures governing the Convertible Notes from incurring additional debt, securing existing or future debt, repurchasing our stock, making investments, paying dividends, recapitalizing our debt, or taking a number of other actions that could have the effect of diminishing our ability to make payments on the Convertible Notes when due.

Our ability to pay our debt when due or to refinance our indebtedness, including the Convertible Notes, depends on our financial condition at such time, the condition of capital markets, and our future performance, which is subject to economic, financial, competitive, and other factors beyond our control.

The conditional conversion feature of the Convertible Notes, if triggered, may adversely affect our financial condition and operating results.

In the event the conditions for optional conversion of the Convertible Notes by holders are met before the close of business on the business day immediately preceding May 1, 2026, holders of the Convertible Notes will be entitled to convert the Convertible Notes at any time during specified periods at their option.

In the event the conditions for optional conversion of the 2025 Notes or 2026 Notes by holders are met before the close of business on the business day immediately preceding February 1, 2025 or May 1, 2026, respectively, holders of the applicable Convertible Notes will be entitled to convert the Convertible Notes at any time during specified periods at their option.

If one or more holders elect to convert their Convertible Notes, unless we elect to satisfy our conversion obligation by delivering solely shares of our Class A common stock (other than paying cash in lieu of delivering any fractional share), we may settle all or a portion of our conversion obligation in cash, which could adversely affect our liquidity.

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In addition, if any such hedging positions fail to become effective, the counterparties to these hedging positions or their respective affiliates may unwind their hedge positions, which could adversely affect the value of our Class A common stock.

Delaware law and provisions in our certificate of incorporation and bylaws, as well as our Indenture, could make a merger, tender offer, or proxy contest difficult or more expensive, thereby depressing the trading price of our Class A common stock.

Delaware law and provisions in our certificate of incorporation and bylaws, as well as our Indentures, could make a merger, tender offer, or proxy contest difficult or more expensive, thereby depressing the trading price of our Class A common stock.

Our certificate of incorporation and bylaws contain provisions that could depress the trading price of our Class A common stock by acting to discourage, delay, or prevent a change of control of our company or changes in our management that the stockholders of our company may deem advantageous.

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Any provision of our certificate of incorporation, bylaws, or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock, and could also affect the price that some investors are willing to pay for our Class A common stock.

Furthermore, certain provisions in the Indenture governing our Convertible Notes may make it more difficult or expensive for a third party to acquire us.

For example, the Indenture requires us, at the holders’ election, to repurchase the Convertible Notes for cash on the occurrence of a fundamental change and, in certain circumstances, to increase the conversion rate for a holder that converts its Convertible Notes in connection with a make-whole fundamental change.

Furthermore, certain provisions in the Indentures governing our Convertible Notes may make it more difficult or expensive for a third party to acquire us.

For example, the Indentures require us, at the holders’ election, to repurchase the Convertible Notes for cash on the occurrence of a fundamental change and, in certain circumstances, to increase the conversion rate for a holder that converts its Convertible Notes in connection with a make-whole fundamental change.

A takeover of us may trigger the requirement that we repurchase the Convertible Notes or increase the conversion rate, which could make it more costly for a third party to acquire us.

The Indenture also prohibits us from engaging in a merger or acquisition unless, among other things, the surviving entity assumes our obligations under the Convertible Notes and the Indenture.

These and other provisions in the Indenture could deter or prevent a third party from acquiring us even when the acquisition may be favorable to holders of the Convertible Notes or our stockholders.

The Indentures also prohibit us from engaging in a merger or acquisition unless, among other things, the surviving entity assumes our obligations under the Convertible Notes and the Indentures.

These and other provisions in the Indentures could deter or prevent a third party from acquiring us even when the acquisition may be favorable to holders of the Convertible Notes or our stockholders.

Future sales of shares by existing stockholders could cause our stock price to decline.

If our existing stockholders, including employees and service providers who obtain equity, sell, or indicate an intention to sell, substantial amounts of our Class A common stock in the public market, the trading price of our Class A common stock could decline.

As of March 31, 2020, we had outstanding a total of 1.2 billion shares of Class A common stock, 24.3 million shares of Class B common stock, and 232.8 million shares of Class C common stock.

In addition, as of March 31, 2020, 141.2 million shares of Class A common stock, 1.5 million shares of Class B common stock, and 6.2 million shares of Class C common stock were subject to outstanding stock options and RSUs.

All of our outstanding shares are eligible for sale in the public market, except approximately 408.9 million shares (including options exercisable and RSAs subject to forfeiture as of March 31, 2020) held by directors, executive officers, and other affiliates that are subject to volume limitations under Rule 144 of the Securities Act.

As of June 30, 2020, we had outstanding a total of 1.2 billion shares of Class A common stock, 24.2 million shares of Class B common stock, and 234.4 million shares of Class C common stock.

In addition, as of June 30, 2020, 148.2 million shares of Class A common stock, 1.2 million shares of Class B common stock, and 3.1 million shares of Class C common stock were subject to outstanding stock options and RSUs.

All of our outstanding shares are eligible for sale in the public market, except approximately 402.7 million shares (including options exercisable and RSAs subject to forfeiture as of June 30, 2020) held by directors, executive officers, and other affiliates that are subject to volume limitations under Rule 144 of the Securities Act.

Our employees, other service providers, and directors are subject to our quarterly trading window closures.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors