Snap Inc.’s first quarter loss will likely lead to a large tax deduction.

The photo messaging app and camera company reported a $2.2 billion first quarter loss, of which, about $2 billion came in the form of a stock compensation expense. The charge is an accounting one, meaning it isn’t a drain on Snap’s cash pile.

Snap issued tens of millions restricted shares and stock options to employees as a form of payment, with the stock slated to vest once the company became public. The stock grants are an expense for Snap, because they’re an alternative to cash compensation. And the company can claim a tax deduction for the difference between the price at the time stock was granted and market price when it vested. READ MORE