Presumably they’re going to write off the cost of the acquisition for tax purposes. I suppose that doesn’t preclude selling the assets like the brand and the software, but since it looks like they’re in a hurry to reach profitability, the certainty of booking tens of millions of future tax offsets must have seemed appealing.

If you've never made any money - how much are you really thinking about taxes?

That’s the point: They’re clearly attempting a shift from growth to profitability. Those future profits look that much better to investors if they have (say) $50M in tax offsets already banked.

You know what looks better than $50M in tax offsets? $500M in cash

I don’t understand the point you’re making. Zenly could be readily sold for $500M?

There’s cost, time, and unknown returns in spinning it off.

And it would apparently give a geographically dominant 40 MAU to a competitor.

It’s an insult to users and team members for Snap to just shut it down, and it could become bad PR, but there’s a reasonable case to be made on near-term business strategy.

You don't actually know if it's valuable. Users = costs, they are only valuable if you can monetize somehow. Inability to develop a workable monetization strategy would lead to this sort of outcome.