Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 08, 2022 | |
Document Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-41043 | |
Entity Registrant Name | Expensify, Inc. | |
Entity Incorporation, State | DE | |
Entity Tax Identification Number | 27-0239450 | |
Entity Address, Street | 401 SW 5th Ave | |
Entity Address, City | Portland | |
Entity Address, State | OR | |
Entity Address, Postal Zip Code | 97204 | |
City Area Code | 475 | |
Local Phone Number | 221-8402 | |
Title of each class | Class A Common Stock, par value $0.0001 per share | |
Trading Symbol(s) | EXFY | |
Name of each exchange on which registered | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001476840 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Common Class A | ||
Document Information | ||
Entity Common Stock, Shares Outstanding | 68,598,512 | |
Common Stock, LT10 | ||
Document Information | ||
Entity Common Stock, Shares Outstanding | 7,336,191 | |
Common Stock, LT50 | ||
Document Information | ||
Entity Common Stock, Shares Outstanding | 6,732,693 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Assets | ||
Cash and cash equivalents | $ 106,212 | $ 98,398 |
Accounts receivable, net | 16,274 | 15,713 |
Settlement assets | 39,359 | 21,880 |
Prepaid expenses | 5,698 | 7,436 |
Related party loan receivable | 0 | 14 |
Other current assets | 21,247 | 14,201 |
Total current assets | 188,790 | 157,642 |
Capitalized software, net | 6,142 | 6,359 |
Property and equipment, net | 14,872 | 15,930 |
Lease right-of-use assets | 1,109 | 2,202 |
Deferred tax assets, net | 200 | 370 |
Other assets | 580 | 710 |
Total assets | 211,693 | 183,213 |
Liabilities and stockholders' equity | ||
Accounts payable | 2,177 | 3,752 |
Accrued expenses and other liabilities | 7,862 | 11,046 |
Borrowings under line of credit | 15,000 | 15,000 |
Current portion of long-term debt, net of original issuance discount and debt issuance costs | 549 | 549 |
Lease liabilities, current | 1,190 | 1,549 |
Settlement liabilities | 36,383 | 21,680 |
Total current liabilities | 63,161 | 53,576 |
Lease liabilities, non-current | 0 | 802 |
Other liabilities | 1,145 | 153 |
Long-term debt, net of original issuance discount and debt issuance costs | 51,572 | 52,067 |
Total liabilities | 115,878 | 106,598 |
Commitments and contingencies (Note 4) | ||
Stockholders' equity: | ||
Common stock | 7 | 6 |
Additional paid-in capital | 185,326 | 142,515 |
Accumulated deficit | (89,518) | (65,906) |
Total stockholders' equity | 95,815 | 76,615 |
Total liabilities and stockholders' equity | $ 211,693 | $ 183,213 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Preferred stock, par value (per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (shares) | 10,000,000 | 10,000,000 |
Common Class A | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 68,575,385 | 67,844,060 |
Common stock, shares outstanding (in shares) | 68,575,385 | 67,844,060 |
Common Stock, LT10 | ||
Common stock, shares authorized (in shares) | 24,997,561 | 25,000,000 |
Common stock, shares issued (in shares) | 7,336,191 | 7,332,640 |
Common stock, shares outstanding (in shares) | 7,336,191 | 7,332,640 |
Common Stock, LT50 | ||
Common stock, shares authorized (in shares) | 24,999,170 | 25,000,000 |
Common stock, shares issued (in shares) | 6,732,693 | 6,224,160 |
Common stock, shares outstanding (in shares) | 6,732,693 | 6,224,160 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenue | $ 42,493 | $ 37,447 | $ 126,026 | $ 102,471 |
Cost of revenue, net | 16,554 | 18,197 | 46,564 | 33,768 |
Gross margin | 25,939 | 19,250 | 79,462 | 68,703 |
Operating expenses: | ||||
Research and development | 3,416 | 2,167 | 10,701 | 8,138 |
General and administrative | 15,898 | 18,333 | 45,335 | 35,827 |
Sales and marketing | 12,342 | 7,608 | 37,958 | 14,555 |
Total operating expenses | 31,656 | 28,108 | 93,994 | 58,520 |
(Loss) income from operations | (5,717) | (8,858) | (14,532) | 10,183 |
Interest and other expenses, net | (2,369) | (1,054) | (5,226) | (2,560) |
(Loss) income before income taxes | (8,086) | (9,912) | (19,758) | 7,623 |
(Provision) benefit for income taxes | (156) | 3,567 | (3,854) | 706 |
Net (loss) income | (8,242) | (6,345) | (23,612) | 8,329 |
Less: income allocated to participating securities, basic | 0 | 0 | 0 | (5,625) |
Less: income allocated to participating securities, diluted | 0 | 0 | 0 | (5,625) |
Net (loss) income attributable to Class A, LT10 and LT50 common stockholders | (8,242) | (6,345) | (23,612) | 2,704 |
Net (loss) income attributable to Class A, LT10 and LT50 common stockholders | $ (8,242) | $ (6,345) | $ (23,612) | $ 2,704 |
Net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders: | ||||
Basic (in dollars per share) | $ (0.10) | $ (0.18) | $ (0.29) | $ 0.09 |
Diluted (in dollars per share) | $ (0.10) | $ (0.18) | $ (0.29) | $ 0.07 |
Weighted-average shares of common stock used to compute net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders: | ||||
Weighted-average number of basic shares outstanding (in shares) | 80,941,664 | 34,490,860 | 80,523,557 | 31,301,387 |
Weighted-average number of diluted shares outstanding (in shares) | 80,941,664 | 34,490,860 | 80,523,557 | 41,452,880 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Convertible Preferred Stock and Stockholders’ Equity (Deficit) (Unaudited) - USD ($) $ in Thousands | Total | Convertible preferred stock Convertible preferred stock | Common stock | Additional paid-in capital | Subscriptions receivable | Accumulated deficit |
Beginning balance at Dec. 31, 2020 | $ 45,105 | |||||
Beginning balance (in shares) at Dec. 31, 2020 | 4,203,139 | |||||
Ending balance at Sep. 30, 2021 | $ 45,105 | |||||
Ending balance (in shares) at Sep. 30, 2021 | 4,203,139 | |||||
Beginning balance at Dec. 31, 2020 | $ (31,036) | $ 0 | $ 21,312 | $ 0 | $ (52,348) | |
Beginning balance (in shares) at Dec. 31, 2020 | 29,366,940 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Issuance of common stock on exercise of stock options | 2,862 | 3,375 | (513) | |||
Issuance of common stock upon exercise of stock options (in shares) | 6,873,860 | |||||
Vesting of early exercised stock options | 234 | 234 | ||||
Stock-based compensation | 2,495 | 2,495 | ||||
Net (loss) income | 8,329 | 8,329 | ||||
Ending balance at Sep. 30, 2021 | (17,116) | $ 0 | 27,416 | (513) | (44,019) | |
Ending balance (in shares) at Sep. 30, 2021 | 36,240,800 | |||||
Beginning balance at Jun. 30, 2021 | $ 45,105 | |||||
Beginning balance (in shares) at Jun. 30, 2021 | 4,203,139 | |||||
Ending balance at Sep. 30, 2021 | $ 45,105 | |||||
Ending balance (in shares) at Sep. 30, 2021 | 4,203,139 | |||||
Beginning balance at Jun. 30, 2021 | (13,793) | $ 0 | 25,641 | (1,760) | (37,674) | |
Beginning balance (in shares) at Jun. 30, 2021 | 34,780,520 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Issuance of common stock on exercise of stock options | 1,891 | 644 | 1,247 | |||
Issuance of common stock upon exercise of stock options (in shares) | 1,460,280 | |||||
Vesting of early exercised stock options | 234 | 234 | ||||
Stock-based compensation | 897 | 897 | ||||
Net (loss) income | (6,345) | (6,345) | ||||
Ending balance at Sep. 30, 2021 | (17,116) | $ 0 | 27,416 | (513) | (44,019) | |
Ending balance (in shares) at Sep. 30, 2021 | 36,240,800 | |||||
Beginning balance at Dec. 31, 2021 | 76,615 | $ 6 | 142,515 | 0 | (65,906) | |
Beginning balance (in shares) at Dec. 31, 2021 | 81,400,860 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Issuance of common stock on exercise of stock options | $ 615 | 615 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 406,739 | 406,739 | ||||
Vesting of early exercised stock options | $ 998 | 998 | ||||
Issuance of restricted stock units | 76 | |||||
Issuance of restricted stock units (in shares) | 76,000 | 10,568 | ||||
Repurchases of early exercised stock options | $ (25) | (25) | ||||
Repurchases of early exercised stock options (in shares) | (16,929) | |||||
Issuance of common stock under Matching Plan | 2,433 | 2,433 | ||||
Issuance of common stock under Matching Plan (in shares) | 151,946 | |||||
Issuance of common stock in connection with restricted stock units vesting | 1 | $ 1 | ||||
Issuance of common stock in connection with restricted stock units vesting (in shares) | 1,020,109 | |||||
Shares withheld from common stock issued to pay employee payroll taxes | (4,172) | (4,172) | ||||
Shares withheld from common stock issued to pay employee payroll taxes (in shares) | (329,024) | |||||
Stock-based compensation | 42,886 | 42,886 | ||||
Net (loss) income | (23,612) | (23,612) | ||||
Ending balance at Sep. 30, 2022 | 95,815 | $ 7 | 185,326 | 0 | (89,518) | |
Ending balance (in shares) at Sep. 30, 2022 | 82,644,269 | |||||
Beginning balance at Jun. 30, 2022 | 92,691 | $ 6 | 173,961 | 0 | (81,276) | |
Beginning balance (in shares) at Jun. 30, 2022 | 81,773,016 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Issuance of common stock on exercise of stock options | 181 | 181 | ||||
Issuance of common stock upon exercise of stock options (in shares) | 99,664 | |||||
Vesting of early exercised stock options | 247 | 247 | ||||
Issuance of restricted stock units | 30 | 30 | ||||
Issuance of restricted stock units (in shares) | 3,939 | |||||
Repurchases of early exercised stock options | (5) | (5) | ||||
Repurchases of early exercised stock options (in shares) | (3,859) | |||||
Issuance of common stock under Matching Plan | 1,235 | 1,235 | ||||
Issuance of common stock under Matching Plan (in shares) | 80,424 | |||||
Issuance of common stock in connection with restricted stock units vesting | 1 | $ 1 | ||||
Issuance of common stock in connection with restricted stock units vesting (in shares) | 1,020,109 | |||||
Shares withheld from common stock issued to pay employee payroll taxes | (4,162) | |||||
Shares withheld from common stock issued to pay employee payroll taxes (in shares) | (329,024) | |||||
Stock-based compensation | 13,839 | 13,839 | ||||
Net (loss) income | (8,242) | (8,242) | ||||
Ending balance at Sep. 30, 2022 | $ 95,815 | $ 7 | $ 185,326 | $ 0 | $ (89,518) | |
Ending balance (in shares) at Sep. 30, 2022 | 82,644,269 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (23,612) | $ 8,329 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and amortization | 4,072 | 3,732 |
Reduction of operating lease right-of-use assets | 531 | 552 |
Loss on impairment, receivables and sale or disposal of equipment | 722 | 283 |
Stock-based compensation | 41,793 | 2,495 |
Amortization of original issuance discount and debt issuance costs | 22 | 23 |
Deferred tax assets | 170 | 0 |
Changes in assets and liabilities: | ||
Accounts receivable, net | (1,016) | (3,865) |
Settlement assets | (10,096) | (3,344) |
Prepaid expenses | 1,738 | (2,886) |
Related party loan receivable | 14 | (224) |
Other current assets | 558 | 1,212 |
Other assets | 11 | 120 |
Accounts payable | (1,575) | (330) |
Accrued expenses and other liabilities | (2,195) | 18,870 |
Operating lease liabilities | (601) | (614) |
Settlement liabilities | 14,703 | 10,699 |
Other liabilities | 990 | (472) |
Net cash provided by operating activities | 26,229 | 34,580 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (467) | (2,602) |
Software development costs | (906) | (4,397) |
Net cash used by investing activities | (1,373) | (6,999) |
Cash flows from financing activities: | ||
Principal payments of finance leases | (593) | (579) |
Principal payments of term loan | (445) | (25,157) |
Proceeds from term loan | 0 | 45,000 |
Repurchases of early exercised stock options | (25) | 0 |
Proceeds from common stock purchased under Matching Plan | 2,433 | 0 |
Payments of deferred offering costs | 0 | (4,796) |
Vesting of restricted common stock | 0 | 234 |
Proceeds from issuance of common stock on exercise of stock options | 700 | 2,862 |
Payment, Tax Withholding, Share-Based Payment Arrangement | (4,172) | 0 |
Net cash (used) provided by financing activities | (2,102) | 17,564 |
Net increase in cash and cash equivalents and restricted cash | 22,754 | 45,145 |
Cash and cash equivalents and restricted cash, beginning of period | 125,315 | 46,878 |
Cash and cash equivalents and restricted cash, end of period | 148,069 | 92,023 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 2,721 | 2,182 |
Cash paid for income taxes | 879 | 6,910 |
Noncash investing and financing items: | ||
Accrued deferred offering costs | 0 | 795 |
Reconciliation of cash and cash equivalents and restricted cash to the condensed consolidated balance sheets | ||
Cash and cash equivalents | 106,212 | 68,058 |
Restricted cash included in other current assets | 16,255 | 5,989 |
Restricted cash included in other assets | 0 | 47 |
Restricted cash included in settlement assets | 25,602 | 17,929 |
Total cash, cash equivalents and restricted cash | $ 148,069 | $ 92,023 |
GENERAL INFORMATION
GENERAL INFORMATION | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
GENERAL INFORMATION | GENERAL INFORMATION Description of the Business Expensify, Inc. ("Expensify") was incorporated in Delaware on April 29, 2009. Expensify offers a comprehensive expense management platform that integrates with a variety of third-party accounting applications, including QuickBooks Desktop, QuickBooks Online, Xero, NetSuite, Intacct, Sage, Microsoft Dynamics, MYOB and others. Expensify's product simplifies the way that employees and vendors manage and submit expense receipts and bills and provides efficiencies to companies for the payment of those bills. Expensify delivers its services over the internet to corporations and individuals under a license arrangement and offers unique pricing options for small and midsized businesses and enterprises on a per-active-member basis. Expensify also offers an Expensify card ("Expensify Card"), which is primarily distributed to large corporate customers in the United States ("U.S.") that subsequently distribute the card to their employees for business use. The Expensify Card allows customers to have real-time control over their employees' spending and compliance with spending limits in addition to eReceipt reporting on purchases. Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Expensify and its wholly-owned subsidiaries (the "Company") and have been prepared in accordance with United States generally accepted accounting principles ("GAAP") and the applicable rules and regulations of the Securities and Exchange Commission ("SEC") for interim reporting in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP have been condensed or omitted pursuant to such SEC rules. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2021 ("2021 Annual Report"). All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal and recurring adjustments that are necessary for the fair presentation of the Company's financial position, results of operations, equity, and cash flows for the periods presented. Results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or for any other future annual or interim period. Stock Split On October 27, 2021, the Company effected a ten-for-one stock split of its common stock. All share and per share information has been retroactively adjusted to reflect the stock split for all prior periods presented. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates and judgments are based on historical experience, forecasted events and various other assumptions that the Company believes to be reasonable under the circumstances. Estimates and judgments are evaluated on an ongoing basis. Actual results could differ from those estimates. Changes in estimates are recorded in the period in which they become known. Significant estimates and assumptions by management affect the Company’s revenues, classification of employee and employee-related expenses, the useful lives and recoverability of long-lived assets, income taxes, capitalization of internal-use software costs, and stock-based compensation. Updates to Significant Accounting Policies The Company’s significant accounting policies are discussed in Note 2 of the 2021 Annual Report. Since the date of the 2021 Annual Report, there have been no material changes to the Company's significant accounting policies, including the status of recent accounting pronouncements adopted, other than those detailed below. Restricted Cash Restricted cash includes amounts deposited with a commercial bank required as collateral for corporate credit cards issued by the respective commercial bank in the U.S. and United Kingdom, cash in transit for funds held for customers to the Company's Payment Processor, Expensify Card collateral for funds held for customers, cash held by Expensify.org for social justice and equity efforts of Expensify.org, cash held on behalf of service providers to be used towards service provider share purchases at the end of the Matching Plan (as defined in Note 5) offering period, and settlement assets for funds held for customers that are deposited into a commercial bank account held by the Company for the benefit of the customers until remitted to the customers' members. Recent Accounting Pronouncements Not Yet Adopted In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments , which requires an impairment model (known as the current expected credit loss or "CECL Model") that is based on expected rather than incurred losses, with an anticipated result of more timely loss recognition. The CECL Model requires measurement of expected credit losses not only based on historical experience and current conditions, but also by including reasonable and supportable forecasts incorporating forward-looking information. As the Company will no longer qualify as an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, as of December 31, 2022, the guidance will be effective for the Company beginning with the annual reporting period ended December 31, 2022 and interim periods presented therein. The adoption of this ASU is not expected to have a material impact on the Company's consolidated financial statements and related disclosures. |
REVENUE AND CERTAIN STATEMENTS
REVENUE AND CERTAIN STATEMENTS OF OPERATIONS COMPONENTS | 9 Months Ended |
Sep. 30, 2022 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
REVENUE AND CERTAIN STATEMENT OF OPERATIONS COMPONENTS | REVENUE AND CERTAIN STATEMENTS OF OPERATIONS COMPONENTS Revenue by geographic region, based on user address, was as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 United States $ 38,955 $ 33,553 $ 114,862 $ 91,466 All other locations 3,538 3,894 11,164 11,005 Total revenue $ 42,493 $ 37,447 $ 126,026 $ 102,471 No individual customer represented more than 10% of the Company’s total revenue during the three and nine months ended September 30, 2022 and 2021. Cashback Rewards The Company offers a cashback rewards program to all customers based on volume of Expensify Card transactions and Software as a Service ("SaaS") subscription tier. Cashback rewards are earned on a monthly basis and paid out the following month. The Company considers the cashback payments to customers as consideration payable to a customer and is recorded as contra revenue within Revenue on the condensed consolidated statements of operations. Cashback rewards for the three months ended September 30, 2022 and 2021 was $0.8 million and $0.3 million, respectively. Cashback rewards for the nine months ended September 30, 2022 and 2021 was $2.0 million and $0.3 million, respectively. Consideration From a Vendor, Net |
CERTAIN BALANCE SHEET COMPONENT
CERTAIN BALANCE SHEET COMPONENTS | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
CERTAIN BALANCE SHEET COMPONENTS | CERTAIN BALANCE SHEET COMPONENTS Other Current Assets Other current assets consisted of the following (in thousands): September 30, December 31, 2022 2021 Expensify.org restricted cash $ 5,402 $ 3,078 Expensify Card posted collateral for funds held for customers 6,622 5,115 Cash in transit for funds held for customers 3,882 388 Contract assets — 8 Expensify Payments LLC restricted cash 101 55 Income tax receivable 4,797 5,412 Matching plan escrow and other restricted cash 248 — Other 195 145 Total $ 21,247 $ 14,201 Capitalized Software, Net Capitalized software, net consisted of the following (in thousands): September 30, December 31, 2022 2021 Capitalized software development costs $ 12,700 $ 10,966 Less: accumulated amortization (6,558) (4,607) Capitalized software, net $ 6,142 $ 6,359 Amortization expense related to capitalized software development costs is recorded in Cost of revenue, net on the condensed consolidated statements of operations. Amortization expense was $0.6 million and $0.7 million for the three months ended September 30, 2022 and 2021, respectively. Amortization expense was $2.0 million and $1.5 million for the nine months ended September 30, 2022 and 2021, respectively. Property and Equipment, Net Property and equipment, net consisted of the following (in thousands): September 30, December 31, 2022 2021 Computers and equipment $ 183 $ 311 Furniture and fixtures 1,593 1,462 Leasehold improvements 6,948 7,106 Commercial building 6,493 6,493 Land 4,151 4,151 Construction in progress 2,551 2,391 Total property and equipment 21,919 21,914 Less: accumulated depreciation (7,047) (5,984) Total property and equipment, net $ 14,872 $ 15,930 Depreciation expense related to property and equipment is recorded in General and administrative on the condensed consolidated statements of operations. Depreciation expense related to property and equipment for the three months ended September 30, 2022 and 2021 was $0.5 million and $0.5 million, respectively. Depreciation expense related to property and equipment for the nine months ended September 30, 2022 and 2021 was $1.5 million and $1.6 million, respectively. Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consisted of the following (in thousands): September 30, December 31, 2022 2021 Accrued expense reports $ 201 $ 246 Partner payouts and advertising fees 693 574 Hosting and license fees 37 36 Credit card processing fees 21 56 Professional fees 1,303 1,274 Sales, payroll and other taxes payable 2,139 4,936 Cashback rewards 270 239 Interest payable 1,094 783 Restricted common stock liability for early stock option exercises 1,527 2,443 Matching plan payroll liability 206 — Other 371 459 Total $ 7,862 $ 11,046 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Finance and Operating Lease Arrangements The Company did not enter into any additional operating lease agreements or finance lease agreements to finance the acquisition of new property and equipment during the nine months ended September 30, 2022 and 2021. The components of lease cost reflected in the condensed consolidated statements of operations were as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Finance lease cost: Amortization of ROU assets $ 198 $ 198 $ 593 $ 593 Interest on lease liabilities 5 10 19 33 Total finance lease cost 203 208 612 626 Operating lease cost 173 205 531 615 Total lease cost $ 376 $ 413 $ 1,143 $ 1,241 Other information related to leases was as follows (in thousands, except as noted within): September 30, December 31, 2022 2021 Finance lease ROU asset (included within Lease right-of-use assets) $ 658 $ 1,251 Operating lease ROU asset (included within Lease right-of-use assets) $ 451 $ 951 Weighted-average remaining lease term (in years): Finance leases 0.83 1.58 Operating leases 0.67 1.40 Weighted-average discount rate: Finance leases 2.47 % 2.50 % Operating leases 5.25 % 5.30 % Supplemental cash flow information related to leases was as follows (in thousands): Nine months ended September 30, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ (595) $ (678) Operating cash flows from finance leases (19) (33) Financing cash flows from finance leases (593) (579) Maturities of lease liabilities as of September 30, 2022 were as follows (in thousands): Finance leases Operating leases For the year ending: Remainder of 2022 $ 204 $ 196 2023 476 332 2024 — — 2025 — — 2026 — — Thereafter — — Total future lease payments 680 528 Less: imputed interest (8) (10) Less: lease liabilities, current (672) (518) Lease liabilities, non-current $ — $ — Amortizing Term Mortgage In August 2019, the Company entered into an $8.3 million amortizing term mortgage agreement with Canadian Imperial Bank of Commerce ("CIBC") for the Company's commercial building located in Portland, Oregon. The agreement requires principal and interest payments be made each month over a 30-year period. Interest accrues at a fixed rate of 5.00% per year until August 2024, at which point the interest rate changes to the Wall Street Journal Pri me Rate less 0.25% for the remaining term of the mortgage. The borrowings are secured by the building. The outstanding balance of the amortizing term mortgage was $7.9 million and $8.0 million a s of September 30, 2022 and December 31, 2021, respectively. 2021 Amended Term Loan In September 2021, the Company amended and restated its loan and security agreement with CIBC ("2021 Amended Term Loan") to refinance the existing non-amortizing and amortizing term loans, establish a single term loan of up to $75.0 million, consisting of a $45.0 million initial term loan effective immediately with an option to enter into an additional $30.0 million delayed term loan, and increase the monthly revolving line of credit to $25.0 million. The term loan and revolving line of credit mature in September 2026 and September 2024, respectively. Approximately $23.5 million of the loan proceeds were used to immediately repay the remaining balances under the amortizing and non-amortizing term loans at the time of the amendment, as well as commitment fees and other debt issuance costs associated with the amendment. The remaining proceeds from the initial term loan were utilized to fund the Company's normal business operations. Under the 2021 Amended Term Loan, the initial term loan of $45.0 million is payable over a 60 month period with principal and accrued interest payments due each quarter, commencing on September 30, 2021. The 2021 Amended Term Loan amortizes in equal quarterly installments of $0.1 million through September 30, 2024, $0.2 million beginning October 1, 2024 and $0.6 million beginning October 1, 2025, with any remaining principal balance due and payable on maturity. The amounts borrowed bear interest at the bank’s reference rate plus 2.25% (8.50% as of September 30, 2022) beginning on September 30, 2021 and continuing on a quarterly basis through maturity of the term loan. The borrowings are secured by substantially all the Company’s assets. As of September 30, 2022 and December 31, 2021, the outstanding balance of the 2021 Amended Term Loan was $44.5 million and $44.9 million, respectively. Monthly Revolving Line of Credit The line of credit agreement, as amended with the 2021 Amended Term Loan, provides borrowings up to $25.0 million. Borrowings under the line of credit bear interest at CIBC’s reference rate plus 1.00% (7.25% as of September 30, 2022) and are secured by substantially all of the Company’s assets. As of September 30, 2022 and December 31, 2021, there were $15.0 million of borrowings under the line of credit and $10.0 million of capacity available for additional borrowings. In connection with the amortizing term mortgage and the 2021 Amended Term Loan, the Company recorded an immaterial amount of debt issuance costs and the 2021 Amended Term Loan was subject to an original issuance discount. These amounts are being amortized to interest expense over the term of the respective agreements using the effective interest method. As of September 30, 2022 and December 31, 2021, unamortized original issuance discount and debt issuance costs remaining were $0.3 million and $0.2 million, respectively. Future aggregate annual principal payments on long-term debt as of September 30, 2022 is expected to be as follows (in thousands): For the year ending: Remainder of 2022 $ 148 2023 595 2024 715 2025 1,397 2026 42,355 Thereafter 7,190 Total principal payments 52,400 Less: unamortized original issuance discount and debt issuance costs (279) Less: current portion, net of unamortized original issuance discount and debt issuance costs (549) Long-term debt, net of unamortized original issuance discount and debt issuance costs $ 51,572 As of September 30, 2022, the Company was not in compliance with all debt covenants, specifically the covenant restricting the amount of transfers to Expensify Payments LLC and the covenant restricting the amount of repurchases of common stock, which includes our RSU net share settlements, each during the period. A waiver was obtained from CIBC . The Company does not believe non-compliance with these covenants had any material impact on the Company or its operations. The Company expects to be in compliance with all debt covenants by the end of the fiscal quarter ended December 31, 2022. Defined Contribution Plans The Company sponsors a U.S. 401(k) defined contribution plan for all eligible employees who elect to participate. The Company is permitted to make discretionary profit sharing and 401(k) matching contributions as defined in the plan and as approved by the Board of Directors. Effective January 1, 2018, the Company matches up to 4.50% of each eligible participant’s 401(k) contribution. The Company’s actual contribution may be reduced by certain available forfeitures, if any, during the plan year. No discretionary profit-sharing contributions were made during the three and nine months ended September 30, 2022 and 2021. The Company’s 401(k) matching contributions for the three months ended September 30, 2022 and 2021 were $ 0.2 million and $ 0.2 million, respectively. The Company’s 401(k) matching contributions for the nine months ended September 30, 2022 and 2021 were $ 0.6 million and $ 0.5 million, respectively. Legal From time to time in the normal course of business, the Company may be involved in claims, proceedings and litigation. In the case of any litigation, the Company records a provision for a liability when management believes that it is both probable that a liability has been incurred, and the amount of the loss can be reasonably estimated. The Company reviews such provisions at least quarterly and adjusts such provisions to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular case. |
STOCK INCENTIVE PLANS
STOCK INCENTIVE PLANS | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK INCENTIVE PLANS | STOCK INCENTIVE PLANS 2009 and 2019 Stock Plans In 2009, the Board of Directors approved the 2009 Stock Plan ("2009 Stock Plan"). As amended in 2015, the 2009 Stock Plan permitted the Company to grant up to 16,495,150 shares of common stock. In January 2018, the Company increased the number of shares of common stock reserved under the 2009 Stock Plan by 535,130 shares, from 16,495,150 shares to 17,030,280 In April 2019, the Board of Directors approved the adoption of the 2019 Stock Plan ("2019 Stock Plan", and together with the 2009 Stock Plan, "Stock Plans"). The 2019 Stock Plan permitted the Company to grant up to 8,173,970 additional shares, increasing the overall common stock reserved for grant under the Stock Plans to 25,204,250 shares. In September 2021, under the 2019 Stock Plan, the Board of Directors approved the grant of 8,679,380 restricted stock units under the 2019 Stock Plan, which covered of an aggregate of 4,339,690 shares of each of Class A and LT50 common stock effective immediately prior to the effectiveness of the Company's IPO Registration Statement on Form S-1 ("IPO Registration Statement") on November 9, 2021. On November 9, 2021, the Board of Directors amended and restated the 2019 Stock Plan to, among other things, increase the common stock reserved for issuance under the 2019 Stock Plan to an aggregate of 16,856,770 shares of Class A and LT50 common stock. Following the completion of the initial public offering of the Company’s Class A common stock ("IPO"), the Company did not and does not intend to make any further grants under the Stock Plans. However, the Stock Plans will continue to govern the terms and conditions of the outstanding awards granted under the Stock Plans. Upon the expiration, forfeiture, cancellation, withholding of shares upon exercise or settlement of an award to satisfy the exercise price or tax withholding, or repurchase of any shares of Class A common stock underlying outstanding stock-based awards granted under the 2009 Stock Plan or of Class A or LT50 common stock underlying outstanding stock-based awards granted under the 2019 Stock Plan, an equal number of shares of Class A common stock will become available for grant under the 2021 Incentive Award Plan ("2021 Plan") and the Company's 2021 Stock Purchase and Matching Plan ("Matching Plan" and together with the 2021 Plan, "2021 Incentive Plans"). 2021 Incentive Plans In November 2021, the Board of Directors adopted, and its stockholders approved, the 2021 Incentive Plans, which both became effective immediately before the effectiveness of the IPO Registration Statement and use a combined share reserve. Under the 2021 Incentive Plans, 12,453,532 shares of Class A common stock were initially reserved for issuance pursuant to a variety of stock-based awards, including incentive stock options, nonqualified stock options, stock appreciation rights ("SARs"), restricted stock awards ("RSAs"), restricted stock units ("RSUs"), and other forms of equity and cash compensation under the 2021 Plan and purchase rights and matching awards under the Matching Plan. The number of shares initially reserved for issuance or transfer pursuant to awards under the 2021 Incentive Plans will be increased upon the expiration, forfeiture, cancellation, withholding of shares upon exercise or settlement of an award to satisfy the exercise price or tax withholding, or repurchase of any shares of Class A common stock underlying outstanding stock-based awards granted under the 2009 Stock Plan or of Class A or LT50 common stock underlying outstanding stock-based awards granted under the 2019 Stock Plan. The number of shares of Class A common stock reserved for issuance under the 2021 Incentive Plans as of September 30, 2022 and December 31, 2021 was 17,336,972 shares and 12,453,532 shares, respectively. The number of shares will automatically increase each subsequent January 1 through January 1, 2031, by the lesser of (A) 6% of the aggregate number of shares of all classes of common stock outstanding on the immediately preceding calendar year, or (B) such lesser number of shares as determined by the Company’s board of directors or compensation committee; provided, however, that no more than 87,576,990 shares of Class A common stock may be issued upon the exercise of incentive stock options. Matching Plan The Matching Plan operates using consecutive three month offering periods that commenced on March 15, 2022. Employees, consultants and directors ("Service Providers") of the Company can participate in the Matching Plan by electing to contribute compensation through payroll deductions or from fee payments or may be granted discretionary awards under the Matching Plan. On the last day of the offering period the contributions made during the offering period are used to purchase shares of Class A common stock. The price at which Class A common stock is purchased under the Matching Plan equals the average of the high and low trading price of a share of Class A common stock as of the last trading day of the offering period. At the end of each offering period, the Company may provide a discretionary match up to 1/10 of a share of Class A common stock for each share of Class A common stock purchased by or issued to a service provider under the Matching Plan that is retained through the end of the applicable offering period. No fractional shares will be issued by the Company. The Company will round to the nearest full share for shares purchased by a service provider as well as any matched shares issued to a service provider under the Matching Plan. The match rate applicable to each offering period shall be limited to 1.50% of the shares of any class of capital stock outstanding as of the exercise date applicable to such offering period. The Company estimates the fair value of matched shares provided under the Matching Plan using the Black-Scholes option-pricing model on the date of grant. The Company recognizes stock-based compensation expense related to the matched shares pursuant to its Matching Plan on a straight-line basis over the applicable three month offering period. Service Providers who participated in the Matching Plan for the offering period ended September 14, 2022 purchased a total of 73,959 Class A common shares, based on a purchase price of $16.70, resulting in gross cash proceeds to the Company of $1.2 million. For the offering period ended September 14, 2022, the Company elected to match each share of Class A common stock purchased by or issued under the Matching Plan with 1/20 of a share of Class A common stock. During the three and nine months ended September 30, 2022, the Company granted 6,465 and 10,041 shares of Class A common stock under the Matching Plan, respectively. Restricted Stock Units On September 24, 2021, under the 2019 Stock Plan, the Company approved the grant of Class A and LT50 common stock RSUs to Service Providers effective November 9, 2021, the date the Company amended its Certificate of Incorporation, to include, among other things, LT50 common stock. RSUs granted to Service Providers on November 9, 2021 that were approved in September 2021 vest upon the satisfaction of both a performance and service condition. The performance condition was satisfied immediately prior to the effectiveness of the IPO Registration Statement. The service condition is satisfied over eight years with 1/8 of the grant vesting on September 15, 2022 and quarterly vesting of 1/32 of the grant every December 15, March 15, June 15 and September 15 (each, a "Specified Quarterly Date") thereafter until fully vested, in each case subject to continued service to the Company. All RSUs granted to Service Providers after the IPO, under the 2021 Plan, have a service condition only, which is satisfied over eight years from the vesting commencement date corresponding to one of the Specified Quarterly Dates nearest the date of grant, with 1/8 of each grant vesting on the first anniversary of the vesting commencement date and 1/32 of each grant vesting in equal quarterly installments thereafter until fully vested, in each case, subject to continued service to the Company. Pursuant to the Company's Non-Employee Director Compensation Program, which was adopted under the 2021 Incentive Plans, the Company granted 20,163 Class A common stock RSUs for the nine months ended September 30, 2022. A total of 6,945 Class A common RSUs vested during the nine months ended September 30, 2022 related to previously granted RSU awards as the quarterly service conditions were satisfied. There were no RSUs granted under this program during the nine months ended September 30, 2021. During the nine months ended September 30, 2022, RSU activity for Service Providers and non-employee directors was as follows: Class A Common Stock LT50 Common Stock Weighted average grant date fair value per share Outstanding at December 31, 2021 4,329,530 4,301,750 $ 33.75 RSUs granted 63,223 — $ 18.21 RSUs vested (519,691) (507,363) $ 33.70 RSUs cancelled/forfeited/expired (321,545) (321,545) $ 38.84 Outstanding at September 30, 2022 3,551,517 3,472,842 $ 33.88 As of September 30, 2022, there was $218.2 million of unamortized stock-based compensation cost related to unvested RSUs, which is expected to be recognized over the remaining weighted average life of 6.43 years. As of December 31, 2021, there was $282.0 million of unamortized stock-based compensation cost related to unvested RSUs, which is expected to be recognized over the remaining weighted average life of 6.92 years. Stock Options The Stock Plans and the 2021 Plan provide for the grant of incentive and nonstatutory stock options to employees, non-employee directors and consultants of the Company. Under the Stock Plans and the 2021 Plan, the exercise price of incentive stock options must be equal to at least 110% of the fair market value of the common stock on the grant date for a “ten-percent holder” or 100% of the fair market value of the common stock on the grant date for any other participant. The exercise price of nonstatutory options granted must be equal to at least 100% of the fair market value of the Company’s common stock on the date of grant. The Company has only granted options under the Stock Plans. Options typically vest over four years and are exercisable at any time after the grant date, provided that Service Providers exercising unvested options receive restricted common stock that is subject to repurchase at the original exercise price upon termination of service. The repurchase right lapses in accordance with the vesting schedule of the exercised option . Early exercises of options prior to vesting are not deemed to be substantive exercises for accounting purposes and accordingly, amounts received for early exercises of unvested options are recorded as a liability. These repurchase terms are considered to be a forfeiture provision and do not result in variable accounting. During the nine months ended September 30, 2022, the Company repurchased an immaterial amount of exercised restricted common stock. There were no repurchases of exercised restricted common stock during the nine months ended September 30, 2021. As of September 30, 2022 and December 31, 2021, there were 952,151 and 1,437,760 shares subject to repurchase, respectively, related to unvested stock options that had been early exercised . As of September 30, 2022 and December 31, 2021, the Company recorded a liability related to shares subject to repurchase of $1.5 million and $2.4 million, respectively , which is included within Accrued expenses and other liabilities in the accompanying condensed consolidated balan ce sheets. These amounts are reclassified to common stock and additional paid in capital as the underlying shares vest. A summary of the Company's stock option activity was as follows: Shares Weighted average exercise price per share Weighted average Outstanding at December 31, 2021 7,193,193 $ 1.87 6.45 Options granted — $ — Options exercised (406,739) $ 1.72 Options cancelled/forfeited/expired (388,541) $ 1.87 Outstanding at September 30, 2022 6,397,913 $ 1.67 5.43 Exercisable at September 30, 2022 6,205,173 $ 1.52 5.37 The to tal pretax intrinsic value of options exercised during the nine months ended September 30, 2022 and 2021 was $10.3 million and $80.2 million, respectively . The total pretax intrinsic value of options outstanding at September 30, 2022 and December 31, 2021 was $84.4 million and $302.8 million, respectively. The intrinsic value is the difference between the estimated fair market value of the Company’s common stock at the date of exercise and the exercise price for in-the-money options. No options were granted during the nine months ended September 30, 2022. The weighted average grant date fair value of options granted during the nine months ended September 30, 2021 was $4.85. As of September 30, 2022, there was $9.4 million of unrecognized stock-based compensation cost related to unvested stock options, which is expected to be recognized over a weighted average period of 1.33 years. As of December 31, 2021, there was $13.2 million of unrecognized stock-based compensation cost related to unvested stock options, which is expected to be recognized over a weighted average period of 1.70 years. Cash received from option exercises and purchases of shares under the Stock Plans for the nine months ended September 30, 2022 and 2021 was $0.7 million and $2.9 million, re spectively. Stock-Based Compensation The following table summarizes the stock-based compensation expense recognized for options granted under the 2009 Stock Plan, options and RSUs granted under the 2019 Stock Plan, RSUs granted under the 2021 Plan and matching shares issued under the Matching Plan (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Stock options $ 970 $ 897 $ 2,969 $ 2,495 Matching shares 24 — 41 — Restricted stock units 12,370 — 38,783 — Total $ 13,364 $ 897 $ 41,793 $ 2,495 Stock-based compensation expense is allocated based on the cost center to which the award holder spent time during the reported periods. Stock-based compensation is included in the following components of expenses on the accompanying condensed consolidated statements of operations (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Cost of revenue, net $ 4,667 $ 245 $ 14,278 $ 670 Research and development 1,931 154 6,230 482 General and administrative 4,624 410 15,063 1,118 Sales and marketing 2,142 88 6,222 225 Total $ 13,364 $ 897 $ 41,793 $ 2,495 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES For the three and nine months ended September 30, 2022, the Company prepared its interim tax provision by applying a year-to-date effective tax rate. Use of the actual year-to-date effective tax rate commenced during the three months ended September 30, 2021 and the Company believes that continuing to use the actual year-to-date effective tax rate going forward results in the best estimate of the annual effective tax rate. For the three months ended September 30, 2022 and 2021, the Company recorded a provision for income taxes of $0.2 million and a benefit for income taxes of $3.6 million, respectively, which resulted in effective tax rates of (1.9)% and 35.8% , respectively. For the nine months ended September 30, 2022 and 2021, the Company recorded a provision for income taxes of $3.9 million and a benefit for income taxes of $0.7 million, respectively, which resulted in effective tax rates of (19.5)% and (9.3)% , respectively. The principal reasons for the difference between the statutory rate and the effective rate for 2022 were primarily due to non-deductible stock-based compensation, as well as the change in the valuation allowance, Section 162(m) of the Internal Revenue Code ("IRC") compensation limitations and state taxes. The principal reasons for the difference between the statutory rate and the effective rate for 2021 were due to the effects of the excess tax benefit related to stock-based compensation as well as the rate differential for Expensify.org. The Company follows the provisions of Accounting Standards Codification ("ASC") 740-10, Accounting for Uncertainty in Income Taxes . ASC 740-10 prescribes a comprehensive model for the recognition, measurement, presentation and disclosure in financial statements of uncertain tax positions that have been taken or expected to be taken on a tax return. As of September 30, 2022 and December 31, 2021, the Company recorded an uncertain tax position liability, exclusive of interest and penalties, of $1.1 million and $0.2 million respectively, within Other liabilities on the condensed consolidated balance sheets. The Company is subject to income taxes in U.S. federal and various state, local and foreign jurisdictions. The tax years ended December 2012 to December 2021 remain open to examination due to the carryover of unused net operating losses or tax credits. |
NET (LOSS) INCOME PER SHARE
NET (LOSS) INCOME PER SHARE | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
NET (LOSS) INCOME PER SHARE | NET (LOSS) INCOME PER SHARE The following table sets forth the computation of basic and diluted net (loss) income per share (in thousands, except share and per share data): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Numerator Net (loss) income $ (8,242) $ (6,345) $ (23,612) $ 8,329 Less: income allocated to participating securities — — — (5,625) Net (loss) income attributable to Class A, LT10 and LT50 common stockholders, basic and diluted $ (8,242) $ (6,345) $ (23,612) $ 2,704 Denominator Weighted-average shares of common stock used to compute net (loss) income per share attributable to common stockholders, basic 80,941,664 34,490,860 80,523,557 31,301,387 Dilutive effect of warrants — — — 423,685 Dilutive effect of weighted average stock options — — — 9,727,808 Weighted-average shares of common stock used to compute net (loss) income per share attributable to common stockholders, diluted 80,941,664 34,490,860 80,523,557 41,452,880 Net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders, basic $ (0.10) $ (0.18) $ (0.29) $ 0.09 Net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders, diluted $ (0.10) $ (0.18) $ (0.29) $ 0.07 The rights, including the liquidation and dividend rights, of the holders of Class A, LT10 and LT50 common stock are identical, except with respect to voting, conversion and transfer rights. Each share of Class A common stock is entitled to one vote per share, each share of LT10 common stock is entitled to 10 votes per share and each share of LT50 common stock is entitled to 50 votes per share. Each share of LT10 and LT50 common stock is convertible into one share of Class A common stock voluntarily at the option of the holder after the satisfaction of certain requirements, which includes a 10 month notice period for LT10 common stock and a 50 month notice period for LT50 common stock to convert to Class A common stock, or automatically upon certain events. The Class A common stock has no conversion rights. As the liquidation and dividend rights are identical for Class A, LT10 and LT50 common stock, the undistributed earnings are allocated on a proportional basis based on the number of weighted-average shares within each class of common stock during the period and the resulting net (loss) income per share attributable to common stockholders will be the same for the Class A, LT10 and LT50 common stock on an individual or combined basis. The following potentially dilutive shares were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive: Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Warrants — 424,808 — — Weighted-average stock options 5,211,342 5,868,372 5,941,182 — Matching shares 10,310 — 11,208 — Convertible preferred stock — 42,031,390 — 42,031,390 Total 5,221,652 48,324,570 5,952,390 42,031,390 |
EQUITY
EQUITY | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
EQUITY | EQUITYOn May 10, 2022, the Executive Committee of our Board of Directors approved a share repurchase program with authorization to purchase up to $50.0 million of shares of Class A common stock ("2022 Share Repurchase Program"). The Company may repurchase shares from time to time through open market purchases, in privately negotiated transactions or by other means, including the use of trading plans intended to qualify under Rule 10b5-1 of the Securities Exchange Act of 1934 ("Exchange Act"), in accordance with applicable securities laws and other restrictions. The actual timing, manner, price and total amount of future repurchases will depend on a variety of factors, including business, economic and market conditions, corporate and regulatory requirements, prevailing stock prices, restrictions under the terms of loan agreements and other considerations. The 2022 Share Repurchase Program does not obligate the Company to acquire any particular amount of Class A common stock, and the program may be suspended or terminated at any time by the Company at any time at its discretion without prior notice. During the three and nine months ended September 30, 2022, the Company did not repurchase any shares of Class A common stock under the 2022 Share Repurchase Program. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONSDuring the nine months ended September 30, 2022, Expensify, Inc. contributed $2.3 million to its wholly-owned subsidiary, Expensify.org, a nonprofit benefit organization established by the Company. There was an immaterial amount of contributions from Expensify, Inc. to Expensify.org during the nine months ended September 30, 2021. There was an immaterial amount of commitments from Expensify, Inc. that remained open for contribution as of September 30, 2022. There are no other significant related party transactions for the Company as of September 30, 2022, except as noted elsewhere in these condensed consolidated financial statements. |
GENERAL INFORMATION (Policies)
GENERAL INFORMATION (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of Expensify and its wholly-owned subsidiaries (the "Company") and have been prepared in accordance with United States generally accepted accounting principles ("GAAP") and the applicable rules and regulations of the Securities and Exchange Commission ("SEC") for interim reporting in conformity with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements presented in accordance with GAAP have been condensed or omitted pursuant to such SEC rules. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2021 ("2021 Annual Report"). All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the accompanying condensed consolidated financial statements reflect all normal and recurring adjustments that are necessary for the fair presentation of the Company's financial position, results of operations, equity, and cash flows for the periods presented. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates and judgments are based on historical experience, forecasted events and various other assumptions that the Company believes to be reasonable under the circumstances. Estimates and judgments are evaluated on an ongoing basis. Actual results could differ from those estimates. Changes in estimates are recorded in the period in which they become known. Significant estimates and assumptions by management affect the Company’s revenues, classification of employee and employee-related expenses, the useful lives and recoverability of long-lived assets, income taxes, capitalization of internal-use software costs, and stock-based compensation. |
Restricted Cash | Restricted Cash |
Recent Accounting Pronouncements Not Yet Adopted | Recent Accounting Pronouncements Not Yet Adopted In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments - Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments , which requires an impairment model (known as the current expected credit loss or "CECL Model") that is based on expected rather than incurred losses, with an anticipated result of more timely loss recognition. The CECL Model requires measurement of expected credit losses not only based on historical experience and current conditions, but also by including reasonable and supportable forecasts incorporating forward-looking information. As the Company will no longer qualify as an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, as of December 31, 2022, the guidance will be effective for the Company beginning with the annual reporting period ended December 31, 2022 and interim periods presented therein. The adoption of this ASU is not expected to have a material impact on the Company's consolidated financial statements and related disclosures. |
REVENUE AND CERTAIN STATEMENT_2
REVENUE AND CERTAIN STATEMENTS OF OPERATIONS COMPONENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Schedule of Revenue from Geographic Areas | Revenue by geographic region, based on user address, was as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 United States $ 38,955 $ 33,553 $ 114,862 $ 91,466 All other locations 3,538 3,894 11,164 11,005 Total revenue $ 42,493 $ 37,447 $ 126,026 $ 102,471 |
CERTAIN BALANCE SHEET COMPONE_2
CERTAIN BALANCE SHEET COMPONENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Other Current Assets | Other current assets consisted of the following (in thousands): September 30, December 31, 2022 2021 Expensify.org restricted cash $ 5,402 $ 3,078 Expensify Card posted collateral for funds held for customers 6,622 5,115 Cash in transit for funds held for customers 3,882 388 Contract assets — 8 Expensify Payments LLC restricted cash 101 55 Income tax receivable 4,797 5,412 Matching plan escrow and other restricted cash 248 — Other 195 145 Total $ 21,247 $ 14,201 |
Schedule of Capitalized Software, Net | Capitalized software, net consisted of the following (in thousands): September 30, December 31, 2022 2021 Capitalized software development costs $ 12,700 $ 10,966 Less: accumulated amortization (6,558) (4,607) Capitalized software, net $ 6,142 $ 6,359 |
Schedule of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands): September 30, December 31, 2022 2021 Computers and equipment $ 183 $ 311 Furniture and fixtures 1,593 1,462 Leasehold improvements 6,948 7,106 Commercial building 6,493 6,493 Land 4,151 4,151 Construction in progress 2,551 2,391 Total property and equipment 21,919 21,914 Less: accumulated depreciation (7,047) (5,984) Total property and equipment, net $ 14,872 $ 15,930 |
Schedule of Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities consisted of the following (in thousands): September 30, December 31, 2022 2021 Accrued expense reports $ 201 $ 246 Partner payouts and advertising fees 693 574 Hosting and license fees 37 36 Credit card processing fees 21 56 Professional fees 1,303 1,274 Sales, payroll and other taxes payable 2,139 4,936 Cashback rewards 270 239 Interest payable 1,094 783 Restricted common stock liability for early stock option exercises 1,527 2,443 Matching plan payroll liability 206 — Other 371 459 Total $ 7,862 $ 11,046 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Lease Cost | The components of lease cost reflected in the condensed consolidated statements of operations were as follows (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Finance lease cost: Amortization of ROU assets $ 198 $ 198 $ 593 $ 593 Interest on lease liabilities 5 10 19 33 Total finance lease cost 203 208 612 626 Operating lease cost 173 205 531 615 Total lease cost $ 376 $ 413 $ 1,143 $ 1,241 Supplemental cash flow information related to leases was as follows (in thousands): Nine months ended September 30, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ (595) $ (678) Operating cash flows from finance leases (19) (33) Financing cash flows from finance leases (593) (579) |
Schedule of Supplemental Balance Sheet Information | Other information related to leases was as follows (in thousands, except as noted within): September 30, December 31, 2022 2021 Finance lease ROU asset (included within Lease right-of-use assets) $ 658 $ 1,251 Operating lease ROU asset (included within Lease right-of-use assets) $ 451 $ 951 Weighted-average remaining lease term (in years): Finance leases 0.83 1.58 Operating leases 0.67 1.40 Weighted-average discount rate: Finance leases 2.47 % 2.50 % Operating leases 5.25 % 5.30 % |
Schedule of Finance Lease Maturity | Maturities of lease liabilities as of September 30, 2022 were as follows (in thousands): Finance leases Operating leases For the year ending: Remainder of 2022 $ 204 $ 196 2023 476 332 2024 — — 2025 — — 2026 — — Thereafter — — Total future lease payments 680 528 Less: imputed interest (8) (10) Less: lease liabilities, current (672) (518) Lease liabilities, non-current $ — $ — |
Schedule of Operating Lease Maturity | Maturities of lease liabilities as of September 30, 2022 were as follows (in thousands): Finance leases Operating leases For the year ending: Remainder of 2022 $ 204 $ 196 2023 476 332 2024 — — 2025 — — 2026 — — Thereafter — — Total future lease payments 680 528 Less: imputed interest (8) (10) Less: lease liabilities, current (672) (518) Lease liabilities, non-current $ — $ — |
Summary of Principal Payments on all Long-term Debt | Future aggregate annual principal payments on long-term debt as of September 30, 2022 is expected to be as follows (in thousands): For the year ending: Remainder of 2022 $ 148 2023 595 2024 715 2025 1,397 2026 42,355 Thereafter 7,190 Total principal payments 52,400 Less: unamortized original issuance discount and debt issuance costs (279) Less: current portion, net of unamortized original issuance discount and debt issuance costs (549) Long-term debt, net of unamortized original issuance discount and debt issuance costs $ 51,572 |
STOCK INCENTIVE PLANS (Tables)
STOCK INCENTIVE PLANS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of RSU Rollforward | During the nine months ended September 30, 2022, RSU activity for Service Providers and non-employee directors was as follows: Class A Common Stock LT50 Common Stock Weighted average grant date fair value per share Outstanding at December 31, 2021 4,329,530 4,301,750 $ 33.75 RSUs granted 63,223 — $ 18.21 RSUs vested (519,691) (507,363) $ 33.70 RSUs cancelled/forfeited/expired (321,545) (321,545) $ 38.84 Outstanding at September 30, 2022 3,551,517 3,472,842 $ 33.88 |
Schedule of Stock Option Roll-forward | A summary of the Company's stock option activity was as follows: Shares Weighted average exercise price per share Weighted average Outstanding at December 31, 2021 7,193,193 $ 1.87 6.45 Options granted — $ — Options exercised (406,739) $ 1.72 Options cancelled/forfeited/expired (388,541) $ 1.87 Outstanding at September 30, 2022 6,397,913 $ 1.67 5.43 Exercisable at September 30, 2022 6,205,173 $ 1.52 5.37 |
Schedule of Stock-based Compensation Expense | The following table summarizes the stock-based compensation expense recognized for options granted under the 2009 Stock Plan, options and RSUs granted under the 2019 Stock Plan, RSUs granted under the 2021 Plan and matching shares issued under the Matching Plan (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Stock options $ 970 $ 897 $ 2,969 $ 2,495 Matching shares 24 — 41 — Restricted stock units 12,370 — 38,783 — Total $ 13,364 $ 897 $ 41,793 $ 2,495 Stock-based compensation expense is allocated based on the cost center to which the award holder spent time during the reported periods. Stock-based compensation is included in the following components of expenses on the accompanying condensed consolidated statements of operations (in thousands): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Cost of revenue, net $ 4,667 $ 245 $ 14,278 $ 670 Research and development 1,931 154 6,230 482 General and administrative 4,624 410 15,063 1,118 Sales and marketing 2,142 88 6,222 225 Total $ 13,364 $ 897 $ 41,793 $ 2,495 |
NET (LOSS) INCOME PER SHARE (Ta
NET (LOSS) INCOME PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net (loss) income per share (in thousands, except share and per share data): Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Numerator Net (loss) income $ (8,242) $ (6,345) $ (23,612) $ 8,329 Less: income allocated to participating securities — — — (5,625) Net (loss) income attributable to Class A, LT10 and LT50 common stockholders, basic and diluted $ (8,242) $ (6,345) $ (23,612) $ 2,704 Denominator Weighted-average shares of common stock used to compute net (loss) income per share attributable to common stockholders, basic 80,941,664 34,490,860 80,523,557 31,301,387 Dilutive effect of warrants — — — 423,685 Dilutive effect of weighted average stock options — — — 9,727,808 Weighted-average shares of common stock used to compute net (loss) income per share attributable to common stockholders, diluted 80,941,664 34,490,860 80,523,557 41,452,880 Net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders, basic $ (0.10) $ (0.18) $ (0.29) $ 0.09 Net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders, diluted $ (0.10) $ (0.18) $ (0.29) $ 0.07 |
Schedule of Anti-dilutive Securities | The following potentially dilutive shares were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive: Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Warrants — 424,808 — — Weighted-average stock options 5,211,342 5,868,372 5,941,182 — Matching shares 10,310 — 11,208 — Convertible preferred stock — 42,031,390 — 42,031,390 Total 5,221,652 48,324,570 5,952,390 42,031,390 |
GENERAL INFORMATION - (Details)
GENERAL INFORMATION - (Details) | Oct. 27, 2021 |
Accounting Policies [Abstract] | |
Stock split ratio, common stock | 0.10 |
REVENUE AND CERTAIN STATEMENT_3
REVENUE AND CERTAIN STATEMENTS OF OPERATIONS COMPONENTS - Total Revenue by Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue | ||||
Revenue | $ 42,493 | $ 37,447 | $ 126,026 | $ 102,471 |
United States | ||||
Disaggregation of Revenue | ||||
Revenue | 38,955 | 33,553 | 114,862 | 91,466 |
All other locations | ||||
Disaggregation of Revenue | ||||
Revenue | $ 3,538 | $ 3,894 | $ 11,164 | $ 11,005 |
REVENUE AND CERTAIN STATEMENT_4
REVENUE AND CERTAIN STATEMENTS OF OPERATIONS COMPONENTS - Narratives (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue | ||||
Consideration from a vendor, net | $ 1.7 | $ 0.8 | $ 4.4 | $ 1.9 |
Cashback rewards | ||||
Disaggregation of Revenue | ||||
Cashback rewards | $ 0.8 | $ 0.3 | $ 2 | $ 0.3 |
CERTAIN BALANCE SHEET COMPONE_3
CERTAIN BALANCE SHEET COMPONENTS - Other current assets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Schedule Of Other Current Assets | ||
Expensify Card posted collateral for funds held for customers | $ 6,622 | $ 5,115 |
Cash in transit for funds held for customers | 3,882 | 388 |
Contract assets | 0 | 8 |
Income tax receivable | 4,797 | 5,412 |
Matching plan escrow and other restricted cash | 248 | 0 |
Other | 195 | 145 |
Total | 21,247 | 14,201 |
Expensify Payment LLC | Affiliated Entity | ||
Schedule Of Other Current Assets | ||
Restricted cash | 101 | 55 |
Subsidiaries | Expensify.Org | ||
Schedule Of Other Current Assets | ||
Restricted cash | $ 5,402 | $ 3,078 |
CERTAIN BALANCE SHEET COMPONE_4
CERTAIN BALANCE SHEET COMPONENTS - Capitalized software, net (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Capitalized software development costs | $ 12,700 | $ 10,966 |
Less: accumulated amortization | (6,558) | (4,607) |
Capitalized software, net | $ 6,142 | $ 6,359 |
CERTAIN BALANCE SHEET COMPONE_5
CERTAIN BALANCE SHEET COMPONENTS - Narratives (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Amortization expense | $ 0.6 | $ 0.7 | $ 2 | $ 1.5 |
Depreciation | $ 0.5 | $ 0.5 | $ 1.5 | $ 1.6 |
CERTAIN BALANCE SHEET COMPONE_6
CERTAIN BALANCE SHEET COMPONENTS - Property and equipment, net (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment | ||
Total property and equipment | $ 21,919 | $ 21,914 |
Less: accumulated depreciation | (7,047) | (5,984) |
Total property and equipment, net | 14,872 | 15,930 |
Computers and equipment | ||
Property, Plant and Equipment | ||
Total property and equipment | 183 | 311 |
Furniture and fixtures | ||
Property, Plant and Equipment | ||
Total property and equipment | 1,593 | 1,462 |
Leasehold improvements | ||
Property, Plant and Equipment | ||
Total property and equipment | 6,948 | 7,106 |
Commercial building | ||
Property, Plant and Equipment | ||
Total property and equipment | 6,493 | 6,493 |
Land | ||
Property, Plant and Equipment | ||
Total property and equipment | 4,151 | 4,151 |
Construction in progress | ||
Property, Plant and Equipment | ||
Total property and equipment | $ 2,551 | $ 2,391 |
CERTAIN BALANCE SHEET COMPONE_7
CERTAIN BALANCE SHEET COMPONENTS - Accrued expenses and other liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued expense reports | $ 201 | $ 246 |
Partner payouts and advertising fees | 693 | 574 |
Hosting and license fees | 37 | 36 |
Credit card processing fees | 21 | 56 |
Professional fees | 1,303 | 1,274 |
Sales, payroll and other taxes payable | 2,139 | 4,936 |
Cashback rewards | 270 | 239 |
Interest payable | 1,094 | 783 |
Restricted common stock liability for early stock option exercises | 1,527 | 2,443 |
Matching plan payroll liability | 206 | 0 |
Other | 371 | 459 |
Total | $ 7,862 | $ 11,046 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Summary of Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Finance lease cost: | ||||
Amortization of ROU assets | $ 198 | $ 198 | $ 593 | $ 593 |
Interest on lease liabilities | 5 | 10 | 19 | 33 |
Total finance lease cost | 203 | 208 | 612 | 626 |
Operating lease cost | 173 | 205 | 531 | 615 |
Total lease cost | $ 376 | $ 413 | $ 1,143 | $ 1,241 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Summary of Related to Leases (Details)(Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Finance lease ROU asset (included within Lease right-of-use assets) | $ 658 | $ 1,251 |
Operating lease ROU asset (included within Lease right-of-use assets) | $ 451 | $ 951 |
Weighted-average remaining lease term (in years): | ||
Finance leases | 9 months 29 days | 1 year 6 months 29 days |
Operating leases | 8 months 1 day | 1 year 4 months 24 days |
Weighted-average discount rate: | ||
Finance leases | 2.47% | 2.50% |
Operating leases | 5.25% | 5.30% |
Finance Lease, Right-of-Use Asset, Statement of Financial Position | Lease right-of-use assets | Lease right-of-use assets |
Operating Lease, Right-of-Use Asset, Statement of Financial Position | Lease right-of-use assets | Lease right-of-use assets |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Cashflow Disclosures (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ (595) | $ (678) |
Operating cash flows from finance leases | (19) | (33) |
Financing cash flows from finance leases | $ (593) | $ (579) |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES - Lease Maturity Schedule (Details) (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Finance leases | |
Remainder of 2022 | $ 204 |
2023 | 476 |
2024 | 0 |
2025 | 0 |
2026 | 0 |
Thereafter | 0 |
Total future lease payments | 680 |
Less: imputed interest | (8) |
Less: lease liabilities, current | (672) |
Lease liabilities, non-current | $ 0 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Lease Liability, Current |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Lease liabilities, non-current |
Operating leases | |
Remainder of 2022 | $ 196 |
2023 | 332 |
2024 | 0 |
2025 | 0 |
2026 | 0 |
Thereafter | 0 |
Total future lease payments | 528 |
Less: imputed interest | (10) |
Less: lease liabilities, current | (518) |
Lease liabilities, non-current | $ 0 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Lease liabilities, current |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Lease liabilities, non-current |
COMMITMENTS AND CONTINGENCIES_5
COMMITMENTS AND CONTINGENCIES - Amortizing Term Mortgage (Details) - USD ($) $ in Thousands | 1 Months Ended | ||
Aug. 31, 2019 | Sep. 30, 2022 | Dec. 31, 2021 | |
Schedule of Capitalization, Long-term Debt | |||
Long-term debt, net of original issuance discount and debt issuance costs | $ 51,572 | $ 52,067 | |
Mortgages | |||
Schedule of Capitalization, Long-term Debt | |||
Loaned amount | $ 8,300 | ||
Debt instrument, term (in years) | 30 years | ||
Interest rate (as a percent) | 5% | ||
Long-term debt, net of original issuance discount and debt issuance costs | $ 7,900 | $ 8,000 | |
Mortgages | Prime Rate | |||
Schedule of Capitalization, Long-term Debt | |||
Variable rate (as a percent) | 0.25% |
COMMITMENTS AND CONTINGENCIES_6
COMMITMENTS AND CONTINGENCIES - 2021 Amended Term Loan (Details) - USD ($) | 1 Months Ended | 9 Months Ended | ||||||
Oct. 01, 2025 | Oct. 01, 2024 | Sep. 30, 2024 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Schedule of Capitalization, Long-term Debt | ||||||||
Repayments of long term debt | $ 445,000 | $ 25,157,000 | ||||||
Long-term debt, net of original issuance discount and debt issuance costs | $ 51,572,000 | $ 52,067,000 | ||||||
2021 Amended Term Loan | Secured Debt | ||||||||
Schedule of Capitalization, Long-term Debt | ||||||||
Maximum borrowing capacity | $ 75,000,000 | $ 75,000,000 | 75,000,000 | |||||
Effective interest rate (as a percent) | 850% | |||||||
Long-term debt, net of original issuance discount and debt issuance costs | $ 44,500,000 | $ 44,900,000 | ||||||
2021 Amended Term Loan | Secured Debt | Reference Rate | ||||||||
Schedule of Capitalization, Long-term Debt | ||||||||
Variable rate (as a percent) | 2.25% | |||||||
2021 Amended Term Loan | Secured Debt | Forecast | Subsequent Event | ||||||||
Schedule of Capitalization, Long-term Debt | ||||||||
Periodic payment | $ 600,000 | $ 200,000 | $ 100,000 | |||||
2021 Amended Term Loan | Line of Credit | Revolving Credit Facility | ||||||||
Schedule of Capitalization, Long-term Debt | ||||||||
Maximum borrowing capacity | $ 25,000,000 | 25,000,000 | 25,000,000 | |||||
Repayments of long term debt | $ 23,500,000 | |||||||
2021 Amended Term Loan | Line of Credit | Revolving Credit Facility | Reference Rate | ||||||||
Schedule of Capitalization, Long-term Debt | ||||||||
Variable rate (as a percent) | 1% | |||||||
Effective interest rate (as a percent) | 725% | |||||||
Initial Term Loan | Secured Debt | ||||||||
Schedule of Capitalization, Long-term Debt | ||||||||
Maximum borrowing capacity | 45,000,000 | $ 45,000,000 | 45,000,000 | |||||
Debt instrument, term (in years) | 60 months | |||||||
Delayed Term Loan | Secured Debt | ||||||||
Schedule of Capitalization, Long-term Debt | ||||||||
Maximum borrowing capacity | $ 30,000,000 | $ 30,000,000 | $ 30,000,000 |
COMMITMENTS AND CONTINGENCIES_7
COMMITMENTS AND CONTINGENCIES - Monthly revolving line of credit (Details) - USD ($) | 1 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2022 | Dec. 31, 2021 | |
Line of Credit Facility | |||
Borrowings under line of credit | $ 15,000,000 | $ 15,000,000 | |
Unamortized debt issuance cost | 279,000 | 200,000 | |
2021 Amended Term Loan | |||
Line of Credit Facility | |||
Debt issuance cost | 0 | ||
Issuance discount | 0 | ||
Revolving Credit Facility | 2021 Amended Term Loan | Line of Credit | |||
Line of Credit Facility | |||
Maximum borrowing capacity | $ 25,000,000 | ||
Borrowings under line of credit | 15,000,000 | 15,000,000 | |
Remaining borrowing capacity | $ 10,000,000 | $ 10,000,000 | |
Revolving Credit Facility | 2021 Amended Term Loan | Line of Credit | Reference Rate | |||
Line of Credit Facility | |||
Variable rate (as a percent) | 1% | ||
Effective interest rate (as a percent) | 725% |
COMMITMENTS AND CONTINGENCIES_8
COMMITMENTS AND CONTINGENCIES - Future aggregate annual principal payments on all long-term debt (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Long-term Debt, Fiscal Year Maturity | ||
Remainder of 2022 | $ 148 | |
2023 | 595 | |
2024 | 715 | |
2025 | 1,397 | |
2026 | 42,355 | |
Thereafter | 7,190 | |
Total principal payments | 52,400 | |
Less: unamortized original issuance discount and debt issuance costs | (279) | $ (200) |
Less: current portion, net of unamortized original issuance discount and debt issuance costs | (549) | (549) |
Long-term debt, net of unamortized original issuance discount and debt issuance costs | $ 51,572 | $ 52,067 |
COMMITMENTS AND CONTINGENCIES_9
COMMITMENTS AND CONTINGENCIES - Defined Contribution Plans (Details) - United States - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jan. 01, 2018 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Defined Contribution Plan | |||||
Employer discretionary matching | $ 0 | $ 0 | $ 0 | $ 0 | |
Employer contributions | $ 200,000 | $ 200,000 | $ 600,000 | $ 500,000 | |
Maximum | |||||
Defined Contribution Plan | |||||
Employer contribution (as a percent) (up to) | 4.50% |
STOCK INCENTIVE PLANS - 2009 an
STOCK INCENTIVE PLANS - 2009 and 2019 Stock Option Plan (Details) - shares | 1 Months Ended | 9 Months Ended | ||||
Apr. 30, 2019 | Jan. 31, 2018 | Sep. 30, 2022 | Nov. 09, 2021 | Sep. 30, 2021 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Shares authorized (in shares) | 25,204,250 | |||||
Restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Vesting period (in years) | 8 years | |||||
The 2009 Option Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Shares authorized (in shares) | 17,030,280 | 16,495,150 | ||||
Additional shares authorized (in shares) | 535,130 | |||||
The 2009 Option Plan | Stock options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Vesting period (in years) | 4 years | |||||
The 2019 Option Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Additional shares authorized (in shares) | 8,173,970 | |||||
The 2019 Option Plan | Common Class A | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Shares authorized (in shares) | 16,856,770 | 4,339,690 | ||||
The 2019 Option Plan | Common Stock, LT50 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Shares authorized (in shares) | 16,856,770 | |||||
The 2019 Option Plan | Restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Shares authorized (in shares) | 8,679,380 | |||||
The 2019 Option Plan | Restricted stock units | Common Stock, LT50 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Shares authorized (in shares) | 4,339,690 | |||||
The 2019 Option Plan | Stock options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||
Vesting period (in years) | 4 years |
STOCK INCENTIVE PLANS - 2021 In
STOCK INCENTIVE PLANS - 2021 Incentive Plan and Matching Plan (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2022 | Jan. 01, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Options granted (in shares) | 0 | ||||
2021 Incentive Plan | Common Class A | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares reserved for future issuance (in shares) | 17,336,972 | 17,336,972 | 12,453,532 | ||
2021 Incentive Plan | Common Class A | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares reserved for future issuance (in shares) | 87,576,990 | ||||
Annual increase in shares reserved for future issuance (as a percent) | 6% | ||||
Matching shares | Common Class A | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Number of shares purchased (in shares) | 73,959 | ||||
Shares purchase price (usd per share) | $ 16.70 | $ 16.70 | |||
Cash proceeds | $ 1.2 | ||||
Options granted (in shares) | 6,465 | 10,041 |
STOCK INCENTIVE PLANS - RSU Nar
STOCK INCENTIVE PLANS - RSU Narratives (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Nov. 09, 2021 | Apr. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares authorized (in shares) | 25,204,250 | ||||
Common Class A | The 2019 Option Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares authorized (in shares) | 4,339,690 | 16,856,770 | |||
Common Stock, LT50 | The 2019 Option Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares authorized (in shares) | 16,856,770 | ||||
Restricted stock units | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Vesting period (in years) | 8 years | ||||
Share-based compensation expense not yet recognized | $ 218.2 | $ 282 | |||
Share-based compensation not yet recognized, recognition period (in years) | 6 years 5 months 4 days | 6 years 11 months 1 day | |||
Restricted stock units | The 2019 Option Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares authorized (in shares) | 8,679,380 | ||||
Restricted stock units | Common Class A | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Granted (in shares) | 63,223 | ||||
Vested (in shares) | 519,691 | ||||
Restricted stock units | Common Class A | 2021 Stock Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Granted (in shares) | 20,163 | 0 | |||
Vested (in shares) | 6,945 | ||||
Restricted stock units | Common Stock, LT50 | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Granted (in shares) | 0 | ||||
Vested (in shares) | 507,363 | ||||
Restricted stock units | Common Stock, LT50 | The 2019 Option Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award | |||||
Shares authorized (in shares) | 4,339,690 |
STOCK INCENTIVE PLANS - RSU Rol
STOCK INCENTIVE PLANS - RSU Rollforward (Details) - $ / shares | 9 Months Ended | |||
Sep. 30, 2022 | Nov. 09, 2021 | Sep. 30, 2021 | Apr. 30, 2019 | |
Weighted average grant date fair value per share | ||||
Beginning balance (in dollars per share) | $ 33.75 | |||
Granted (in dollars per share) | 18.21 | |||
Vested (in dollars per share) | 33.70 | |||
Cancelled/forfeited/expired (in dollars per share) | 38.84 | |||
Ending balance (in dollars per share) | $ 33.88 | |||
Shares authorized (in shares) | 25,204,250 | |||
Common Class A | The 2019 Option Plan | ||||
Weighted average grant date fair value per share | ||||
Shares authorized (in shares) | 16,856,770 | 4,339,690 | ||
Common Stock, LT50 | The 2019 Option Plan | ||||
Weighted average grant date fair value per share | ||||
Shares authorized (in shares) | 16,856,770 | |||
Restricted stock units | The 2019 Option Plan | ||||
Weighted average grant date fair value per share | ||||
Shares authorized (in shares) | 8,679,380 | |||
Restricted stock units | Common Class A | ||||
RSU Rollforward | ||||
Beginning balance (in shares) | 4,329,530 | |||
Granted (in shares) | 63,223 | |||
Vested (in shares) | (519,691) | |||
Cancelled/forfeited/expired (in shares) | (321,545) | |||
Ending balance (in shares) | 3,551,517 | |||
Restricted stock units | Common Stock, LT50 | ||||
RSU Rollforward | ||||
Beginning balance (in shares) | 4,301,750 | |||
Granted (in shares) | 0 | |||
Vested (in shares) | (507,363) | |||
Cancelled/forfeited/expired (in shares) | (321,545) | |||
Ending balance (in shares) | 3,472,842 | |||
Restricted stock units | Common Stock, LT50 | The 2019 Option Plan | ||||
Weighted average grant date fair value per share | ||||
Shares authorized (in shares) | 4,339,690 |
STOCK INCENTIVE PLANS - Stock O
STOCK INCENTIVE PLANS - Stock Option Narratives (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Intrinsic value of options exercised | $ 10.3 | $ 80.2 | |
Intrinsic value of options outstanding | 84.4 | $ 302.8 | |
Weighted average grant date fair value of options granted (in dollars per share) | $ 4.85 | ||
Proceeds from issuance of common stock on exercise of stock options | 0.7 | $ 2.9 | |
Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Share-based compensation expense not yet recognized | $ 9.4 | $ 13.2 | |
Share-based compensation not yet recognized, recognition period (in years) | 1 year 3 months 29 days | 1 year 8 months 12 days | |
Stock options | Common stock | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Shares repurchased (in shares) | 0 | ||
Stock options | The 2019 Option Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Vesting period (in years) | 4 years | ||
Stock options | The 2009 Option Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Vesting period (in years) | 4 years | ||
Non Statutory Options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Purchase price as a percentage of common stock (as a percent) | 100% | ||
Ten Percent Holder | Stock options | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Purchase price as a percentage of common stock (as a percent) | 110% | ||
Other Than Ten Percent Holder | Stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Purchase price as a percentage of common stock (as a percent) | 100% | ||
Chief Executive Officer | Weighted-average stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award | |||
Shares subject to repurchase related to stock options early exercised and not yet vested (in shares) | 952,151 | 1,437,760 | |
Shares subject to repurchase related to stock options early exercised and not yet vested | $ 1.5 | $ 2.4 |
STOCK INCENTIVE PLANS - Stock_2
STOCK INCENTIVE PLANS - Stock Option Roll-forward (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | |
Shares | ||
Beginning balance (in shares) | shares | 7,193,193 | |
Options granted (in shares) | shares | 0 | |
Options exercised (in shares) | shares | (406,739) | |
Options cancelled/forfeited/expired (in shares) | shares | (388,541) | |
Ending balance (in shares) | shares | 6,397,913 | 7,193,193 |
Options exercisable (in shares) | shares | 6,205,173 | |
Weighted average exercise price per share | ||
Beginning balance (in dollars per share) | $ / shares | $ 1.87 | |
Options granted (in dollars per share) | $ / shares | 0 | |
Options exercised (in dollars per share) | $ / shares | 1.72 | |
Options cancelled/forfeited/expired (in dollars per share) | $ / shares | 1.87 | |
Ending balance (in dollars per share) | $ / shares | 1.67 | $ 1.87 |
Options exercisable (in dollars per share) | $ / shares | $ 1.52 | |
Weighted average remaining contractual life, options outstanding (in years) | 5 years 5 months 4 days | 6 years 5 months 12 days |
Weighted average remaining contractual life, options exercisable (in years) | 5 years 4 months 13 days |
STOCK INCENTIVE PLANS - Stock-B
STOCK INCENTIVE PLANS - Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | $ 13,364 | $ 897 | $ 41,793 | $ 2,495 |
Cost of revenue, net | ||||
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | 4,667 | 245 | 14,278 | 670 |
Research and development | ||||
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | 1,931 | 154 | 6,230 | 482 |
General and administrative | ||||
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | 4,624 | 410 | 15,063 | 1,118 |
Sales and marketing | ||||
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | 2,142 | 88 | 6,222 | 225 |
Stock options | ||||
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | 970 | 897 | 2,969 | 2,495 |
Matching shares | ||||
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | 24 | $ 0 | 41 | $ 0 |
Restricted stock units | ||||
Share-based Payment Arrangement, Expense | ||||
Stock based compensation expense | $ 12,370 | $ 38,783 |
STOCK INCENTIVE PLANS - Stock_3
STOCK INCENTIVE PLANS - Stock-based Compensation Narratives (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Software Development | ||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||
Stock-based compensation expense capitalized | $ 0.5 | $ 0.3 | $ 1.1 | $ 0.4 |
INCOME TAXES - (Details)
INCOME TAXES - (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||||
(Provision) benefit for income taxes | $ (156) | $ 3,567 | $ (3,854) | $ 706 | |
Effective income tax rate (in percent) | 1.90% | (35.80%) | 19.50% | (9.30%) | |
Accrual for uncertain tax positions | $ 1,100 | $ 1,100 | $ 200 |
NET (LOSS) INCOME PER SHARE - S
NET (LOSS) INCOME PER SHARE - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator | ||||
Net (loss) income | $ (8,242) | $ (6,345) | $ (23,612) | $ 8,329 |
Less: income allocated to participating securities, basic | 0 | 0 | 0 | (5,625) |
Less: income allocated to participating securities, diluted | 0 | 0 | 0 | (5,625) |
Net (loss) income attributable to Class A, LT10 and LT50 common stockholders | (8,242) | (6,345) | (23,612) | 2,704 |
Net (loss) income attributable to Class A, LT10 and LT50 common stockholders | $ (8,242) | $ (6,345) | $ (23,612) | $ 2,704 |
Denominator | ||||
Weighted Average Number of Shares Weighted-average shares of common stock used to compute net (loss) income per share attributable to common stockholders, basic (in shares) | 80,941,664 | 34,490,860 | 80,523,557 | 31,301,387 |
Dilutive effect of warrants (in shares) | 0 | 0 | 0 | 423,685 |
Dilutive effect of weighted average stock options (in shares) | 0 | 0 | 0 | 9,727,808 |
Weighted-average shares of common stock used to compute net (loss) income per share attributable to common stockholders, diluted (in shares) | 80,941,664 | 34,490,860 | 80,523,557 | 41,452,880 |
Net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders, basic (in dollars per share) | $ (0.10) | $ (0.18) | $ (0.29) | $ 0.09 |
Net (loss) income per share attributable to Class A, LT10 and LT50 common stockholders, diluted (in dollars per share) | $ (0.10) | $ (0.18) | $ (0.29) | $ 0.07 |
NET (LOSS) INCOME PER SHARE - N
NET (LOSS) INCOME PER SHARE - Narratives (Details) | 9 Months Ended |
Sep. 30, 2022 vote shares | |
Common Class A | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |
Voting right per share (vote) | 1 |
Shares converted (in shares) | shares | 1 |
Common Stock, LT10 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |
Voting right per share (vote) | 10 |
Conversion of stock, notice period (in months) | 10 months |
Common Stock, LT50 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |
Voting right per share (vote) | 50 |
Conversion of stock, notice period (in months) | 50 months |
NET (LOSS) INCOME PER SHARE - A
NET (LOSS) INCOME PER SHARE - Anti-dilutive Securities (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive securities (in shares) | 5,221,652 | 48,324,570 | 5,952,390 | 42,031,390 |
Warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive securities (in shares) | 0 | 424,808 | 0 | 0 |
Weighted-average stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive securities (in shares) | 5,211,342 | 5,868,372 | 5,941,182 | 0 |
Matching shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive securities (in shares) | 10,310 | 0 | 11,208 | 0 |
Convertible preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive securities (in shares) | 0 | 42,031,390 | 0 | 42,031,390 |
EQUITY (Details)
EQUITY (Details) $ in Millions | May 10, 2022 USD ($) |
2022 Share Repurchase Program | Class A common stock | |
Equity, Class of Treasury Stock [Line Items] | |
Shares authorized for repurchase | $ 50 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Expensify.Org | Affiliated Entity | |
Related Party Transaction | |
Payment of commitments to related party | $ 2.3 |