Fresh off better-than-expected quarterly earnings, Snap Inc. today announced that it plans to raise $750 million in new funding through a debt offering.

Snap will issue convertible senior notes that expire May 1, 2025, unless repurchased, redeemed or converted before that date, with an option for buyers to acquire an additional $112.5 million of the notes.

Snap said in a statement that it intends to use the proceeds for working capital, operating expenses and capital expenditures. The company added that it may use a portion of the proceeds to make acquisitions or repurchase its common stock.

Although Snap noted that it had no current plans to make acquisitions, it has done so in the past, most recently acquiring computer vision and video analysis software AI Factory Inc. for a reported $166 million in January.

As of its last earnings report, Snap finished the quarter with $2.1 billion cash at hand. It continues to burn money, though at reduced rates. In the first quarter Snap reported free cash flow going from negative $78 million to negative $4.6 million, according to The Motley Fool, while its operating cash flow was positive for the first time ever.

With the COVID-19 pandemic hitting ad revenues hard, Snap is likely facing harder times along with many companies that primarily rely on advertising revenue.

How big the decline in advertising across the board will be is open to speculation. Search Engine Watch noted that ad spend declines of up to 50% are expected across all channels, with digital media down around 40%. Even Google LLC is cutting its ad spending: A report from CNBC today suggested that the internet giant is planning to cut its marketing budget by as much as half for the second half of the year.

With even Google cutting its marketing spend, a significant decline across all markets is a given. A market recovery depends on how soon the coronavirus pandemic slows, allowing an eventual return to regular business.

Snap’s offering is likely a buffer against the impact of the virus, giving it working capital to continue through the pandemic until the advertising market returns to normal.

The news wasn’t taken well by investors, however. Snap shares were down 5.5%, to $16.06, at the end of regular trading today.

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