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Shopify (SHOP)

Filed: 28 Oct 21, 7:07am

EXHIBIT 99.1
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Shopify Announces Third-Quarter 2021 Financial Results
Cumulative GMV reaches $400 billion as Shopify continues to simplify commerce for entrepreneurs everywhere


Shopify reports in U.S. dollars and in accordance with U.S. GAAP

Internet, Everywhere - October 28, 2021 - Shopify Inc. (NYSE, TSX:SHOP), a provider of essential internet infrastructure for commerce, announced today strong financial results for the quarter ended September 30, 2021.

“It took 15 years for our merchants to get to $200 billion in cumulative GMV, and just 16 months to double that to $400 billion,” said Harley Finkelstein, Shopify’s President. “Our merchants’ GMV remained strong in Q3. As the share of GMV from offline expanded within our total GMV, it is clear that entrepreneurs are embracing a future in which retail happens everywhere. Shopify is making it easier for more merchants worldwide to build direct and authentic relationships with their customers, in creative ways that work best for them.”

“The strength of Shopify’s flywheel was on display within the more normalized spending environment we saw this past quarter, as more merchants used more of our platform to start and grow their businesses,” said Amy Shapero, Shopify’s CFO. “Our results show that Shopify is executing well, giving our merchants the tools they need to compete in differentiated ways in a growing number of markets. We remain focused on simplifying commerce for our merchants so they can take full advantage of what digital makes possible and reimagine retail.”

Third-Quarter Financial Highlights
Total revenue in the third quarter was $1,123.7 million, up 46% year over year.
Subscription Solutions revenue was $336.2 million, up 37% year over year, primarily due to more merchants joining the platform.
Merchant Solutions revenue was $787.5 million, up 51% year over year, driven primarily by the growth of Gross Merchandise Volume1 ("GMV").
Monthly Recurring Revenue2 ("MRR") as of September 30, 2021 was $98.8 million. MRR increased 33% year over year, up from $74.4 million as of September 30, 2020 as more merchants joined the platform and
1. Gross Merchandise Volume, or GMV, represents the total dollar value of orders facilitated through the Shopify platform including certain apps and channels for which a revenue-sharing arrangement is in place in the period, net of refunds, and inclusive of shipping and handling, duty and value-added taxes.
2. Monthly Recurring Revenue, or MRR, is calculated by multiplying the number of merchants by the average monthly subscription plan fee in effect on the last day of that period and is used by management as a directional indicator of subscription solutions revenue going forward assuming merchants maintain their subscription plan the following month.


the number of retail locations using POS Pro increased. Shopify Plus contributed $27.2 million, or 28%, of MRR compared with 25% of MRR as of September 30, 2020.
GMV for the third quarter was $41.8 billion, an increase of $10.8 billion or 35% over the third quarter of 2020. Gross Payments Volume3 ("GPV") grew to $20.5 billion, which accounted for 49% of GMV processed in the quarter, versus $14.0 billion, or 45%, for the third quarter of 2020.
Gross profit dollars grew 50% to $608.9 million in the third quarter of 2021, compared with $405.1 million for the third quarter of 2020.
Adjusted gross profit4 dollars grew 49% to $616.4 million in the third quarter of 2021, compared with $412.6 million for the third quarter of 2020.
Operating loss for the third quarter of 2021 was $4.1 million, or 0.4% of revenue, versus income of $50.6 million, or 7% of revenue, for the comparable period a year ago.
Adjusted operating income4 for the third quarter of 2021 was $140.2 million, or 12% of revenue, compared with adjusted operating income of $130.9 million or 17% of revenue in the third quarter of 2020. Adjusted operating income excludes a $30.1 million impairment relating to the planned termination or sublet of additional lease agreements for office space that we ceased using in the third quarter of 2021, resulting from our decision to work remotely permanently, which we announced in the second quarter of 2020.
Net income for the third quarter of 2021 was $1,148.4 million, or $9.00 per diluted share, compared with net income of $191.1 million, or $1.54 per diluted share, for the third quarter of 2020. Q3 2021 net income includes a $1,340.8 million unrealized gain on our equity investments.
Adjusted net income4 for the third quarter of 2021 was $102.8 million, or $0.81 per diluted share, compared with adjusted net income of $140.8 million, or $1.13 per diluted share, for the third quarter of 2020.
At September 30, 2021, Shopify had $7.52 billion in cash, cash equivalents and marketable securities, compared with $6.39 billion at December 31, 2020.

Third-Quarter Business Highlights
Shopify launched Shopify Markets, a product that makes cross-border commerce easier for entrepreneurs. With Shopify Markets, merchants can enter new markets easily, and increase buyer trust and conversion with tailored experiences for each market. By managing all cross-border commerce in Shopify’s centralized commerce platform, Shopify Markets gives merchants a unified view of their entire business across borders.
Shopify began rolling out Shopify Balance, our money management product, to merchants in the United States. Shopify Balance offers merchants a no-fee money management account with fast access to their cash, a card for spending online, on mobile, or in-store, and rewards featuring cash back, perks, and discounts on every day spending.
Shopify introduced TikTok Shopping to merchants, enabling merchants with a TikTok For Business account to add products that link directly to their online store checkout.

3. Gross Payments Volume, or GPV, is the amount of GMV processed through Shopify Payments.
4. Non-GAAP financial measures exclude the effect of stock-based compensation expenses and related payroll taxes, amortization of acquired intangibles, unrealized gains on equity and other investments, a real estate-related impairment charge, and tax effects related to non-GAAP adjustments. Please refer to "Non-GAAP Financial Measures" in this press release for more information.


Shopify continued to build the foundation of Shopify Fulfillment Network, adding capabilities including product bundling, regional tax settings, and tracking inbound transfer shipments of inventory.
Shopify made strides with our All-New POS Pro software, launching it for Android devices, and launched our integrated retail hardware with payments to retail merchants in Germany and New Zealand, and the Netherlands in October, enabling merchants in these regions to seamlessly bridge online and offline commerce.
Shopify opened a brick-and-mortar space in New York City featuring Shopify’s products, services, and technology, and serving as a hub where merchants can receive hands-on support, inspiration, and education to help grow their business.
Shopify launched Shopify Shipping in the United Kingdom, enabling British merchants to easily purchase shipping labels directly from the Shopify merchant admin, saving them time and money.
Merchants in the U.S., Canada, and the U.K. received a record $393.6 million in merchant cash advances and loans from Shopify Capital in the third quarter of 2021, an increase of 56% versus the $252.1 million funded in the third quarter of last year. Shopify Capital has grown to approximately $2.7 billion in cumulative capital funded since its launch in April 2016, approximately $524.0 million of which was outstanding on September 30, 2021.
Beginning on August 1, 2021, Shopify eliminated its revenue share on the first million dollars made by app developer partners annually in the Shopify App Store, and beginning on September 15, 2021, eliminated the revenue share on the first million dollars made by theme developers annually in the Shopify Theme Store. We extended more generous terms in order to increase our support for developers, expand what gets built on Shopify, and attract the best developers in the world to make commerce better for everyone.

Subsequent to Third Quarter 2021
Shopify launched the Shopify Global ERP Program, which allows select ERP partners, initially including Microsoft, Oracle NetSuite, Infor, Acumatica, and Brightpearl, to build direct integrations into the Shopify App Store. This offering unlocks seamless workflows and greater data control for high-volume merchants, helping them transform data into actionable results as they scale on our platform.
Shopify launched the Spotify channel, enabling artist-entrepreneurs on Spotify to connect their Spotify for Artists accounts with their Shopify online stores, where they can sync their product catalogues and seamlessly showcase products directly on their Spotify profile.

Outlook
The outlook that follows constitutes forward-looking information within the meaning of applicable securities laws and is based on a number of assumptions and subject to a number of risks. Actual results could vary materially as a result of numerous factors, including certain risk factors, many of which are beyond Shopify’s control. Please see "Forward-looking Statements" below.





In addition to the other assumptions and factors described in this press release, Shopify’s outlook assumes the continuation of growth trends in our industry, our ability to manage our growth effectively, the absence of material changes in our industry or the global economy and other assumptions related to the COVID-19 pandemic, which are described in detail below. The following statements supersede all prior statements made by Shopify and are based on current expectations. As these statements are forward-looking, actual results may differ materially.

These statements do not give effect to the potential impact of mergers, acquisitions, divestitures or business combinations that may be announced or closed after the date hereof. All numbers provided in this section are approximate.

Our outlook for the remainder of 2021 is consistent with our assumptions in February. The economy remains resilient, consumer spending on services and off-line retail is expanding, and ecommerce, after easing from its peak share as a percent of total retail, is growing at a more normalized pace relative to 2020.

In view of these factors, we continue to expect to grow revenue rapidly in 2021, but at a lower rate than in 2020. For the full year 2021, we continue to expect the following:

Subscriptions solutions revenue growth to be driven by more merchants around the world joining the platform in a number lower than the record in 2020, but higher than any year prior to 2020;
The growth rates of subscription solutions and merchant solutions revenues to be more similar to each other than for 2020, or any year prior to 2020, as we do not expect the surge in GMV that drove merchant solutions in 2020 to repeat; and,
Merchant solutions revenue growth to be driven by continued GMV growth from existing merchants, new merchants joining the platform, and expanded adoption of Shopify’s growing menu of merchant solutions, including established offerings such as Shopify Payments, Shopify Shipping, and Shopify Capital, both geographically and as merchants grow into them, while newer solutions such as Shopify Fulfillment Network and 6 River Systems contribute nascent but incremental revenue in their early stages.

We continue to expect the fourth quarter to contribute the largest share of full-year revenue, and that the revenue spread will be more evenly distributed across the four quarters than it has been historically. While the commerce market, both online and offline, may be impacted by supply chain delays or increased costs for materials, labor, shipping or advertising in the fourth quarter, and spending on Black Friday Cyber Monday may be pulled forward, we expect our GMV in the fourth quarter to continue to grow substantially faster than the commerce market.

We continue to expect rapid growth in gross profit dollars in 2021 and plan to continue reinvesting back into our business as aggressively as we can, with the year-over-year growth in operating expenses accelerating slightly in our fourth quarter, after excluding the $30.1 million impairment charge in Q3 2021, as we expect to hire more engineers




and commercial talent and ramp up our go-to-market programs and events. We continue to expect full-year 2021 adjusted operating income to be above the level we achieved in 2020.

For 2021, we continue to anticipate stock-based compensation expenses and related payroll taxes of $400 million and amortization of acquired intangibles of $22 million.

Quarterly Conference Call
Shopify’s management team will hold a conference call to discuss our third-quarter results today, October 28, 2021, at 8:30 a.m. ET. The conference call will be webcast on the investor relations section of Shopify’s website at https://investors.shopify.com/news-and-events/. An archived replay of the webcast will be available following the conclusion of the call.

Shopify’s Third Quarter 2021 Interim Unaudited Condensed Consolidated Financial Statements and Notes and its Third Quarter 2021 Management's Discussion and Analysis are available on Shopify’s website at www.shopify.com and will be filed on SEDAR at www.sedar.com and on EDGAR at www.sec.gov.

About Shopify
Shopify is a leading provider of essential internet infrastructure for commerce, offering trusted tools to start, grow, market, and manage a retail business of any size. Shopify makes commerce better for everyone with a platform and services that are engineered for reliability, while delivering a better shopping experience for consumers everywhere. Proudly founded in Ottawa, Shopify powers over 1.7 million businesses in more than 175 countries and is trusted by brands such as Allbirds, Gymshark, Heinz, Staples Canada, and many more. For more information, visit www.shopify.com.

Non-GAAP Financial Measures
To supplement our consolidated financial statements, which are prepared and presented in accordance with United States generally accepted accounting principles ("GAAP"), Shopify uses certain non-GAAP financial measures to provide additional information in order to assist investors in understanding our financial and operating performance.

Adjusted gross profit, adjusted operating income, non-GAAP operating expenses, adjusted net income and adjusted net income per share are non-GAAP financial measures that exclude the effect of stock-based compensation expenses and related payroll taxes, amortization of acquired intangibles, and a real estate-related impairment charge. Adjusted net income and adjusted net income per share also exclude unrealized gains on equity and other investments and tax effects related to non-GAAP adjustments.

Management uses non-GAAP financial measures internally for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Shopify believes that these non-GAAP measures provide useful




information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. Non-GAAP financial measures are not recognized measures for financial statement presentation under U.S. GAAP and do not have standardized meanings, and may not be comparable to similar measures presented by other public companies. Such non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP. See the financial tables below for a reconciliation of the non-GAAP measures.

Forward-looking Statements
This press release contains certain forward-looking statements within the meaning of applicable securities laws, including statements regarding Shopify’s planned business initiatives and operations and outlook, the performance of Shopify's merchants, the impact of Shopify's business on its merchants and other entrepreneurs, and economic activity and consumer spending. Words such as "continue", "will", “plan”, “anticipate”, "become", "enable", and "expect" or similar expressions are intended to identify forward-looking statements.

These forward-looking statements are based on Shopify’s current projections and expectations about future events and financial trends that management believes might affect its financial condition, results of operations, business strategy and financial needs, and on certain assumptions and analysis made by Shopify in light of the experience and perception of historical trends, current conditions and expected future developments and other factors management believes are appropriate. These projections, expectations, assumptions and analyses are subject to known and unknown risks, uncertainties, assumptions and other factors that could cause actual results, performance, events and achievements to differ materially from those anticipated in these forward-looking statements. Although Shopify believes that the assumptions underlying these forward-looking statements are reasonable, they may prove to be incorrect, and readers cannot be assured that actual results will be consistent with these forward-looking statements. Actual results could differ materially from those projected in the forward-looking statements as a result of numerous factors, including certain risk factors, many of which are beyond Shopify’s control, including but not limited to: (i) merchant acquisition and retention; (ii) managing our growth; (iii) our potential inability to compete successfully against current and future competitors; (iv) the security of personal information we store relating to merchants and their customers and consumers with whom we have a direct relationship; (v) our history of losses and our ability to maintain profitability; (vi) a disruption of service or security breach; (vii) our limited operating history in new markets and geographic regions; (viii) our ability to innovate; (ix) international sales and operations and the use of our platform in various countries; (x) our reliance on a single supplier to provide the technology we offer through Shopify Payments; (xi) our potential inability to hire, retain and motivate qualified personnel; (xii) our use of a single cloud-based platform to deliver our services; (xiii) uncertainty around the duration and scope of the COVID-19 pandemic and the impact of the pandemic and actions taken in response on global and regional economies and economic activity; (xiv) the reliance of our growth in part on the success of our strategic relationships with third parties; (xv) complex and changing laws and regulations worldwide; (xvi) our dependence




on the continued services of management and other key employees; (xvii) our potential failure to effectively maintain, promote and enhance our brand; (xviii) payments processed through Shopify Payments; (xix) serious errors or defects in our software or hardware or issues with our hardware supply chain; (xx) our potential inability to achieve or maintain data transmission capacity; (xxi) activities of merchants or partners or the contents of merchants’ shops; (xxii) evolving privacy laws and regulations, cross-border data transfer restrictions, data localization requirements and other domestic or foreign regulations may limit the use and adoption of our services; (xxiii) changes in tax laws or adverse outcomes related to our taxes; (xiv) other one-time events and other important factors disclosed previously and from time to time in Shopify’s filings with the U.S. Securities and Exchange Commission and the securities commissions or similar securities regulatory authorities in each of the provinces or territories of Canada. The forward-looking statements contained in this news release represent Shopify’s expectations as of the date of this news release, or as of the date they are otherwise stated to be made, and subsequent events may cause these expectations to change. Shopify undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.

CONTACT:
INVESTORS:MEDIA:
Katie KeitaRebecca Feigelsohn
Senior Director, Investor RelationsCommunications Lead
613-241-2828 x 1024416-238-6705 x 302
IR@shopify.compress@shopify.com
SOURCE: Shopify







Shopify Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income
(Expressed in US $000’s, except share and per share amounts, unaudited)

Three months endedNine months ended
September 30, 2021September 30, 2020September 30, 2021September 30, 2020
$$$$
Revenues
Subscription solutions336,208245,274991,126629,317
Merchant solutions787,532522,1312,240,7061,322,430
1,123,740767,4053,231,8321,951,747
Cost of revenues
Subscription solutions67,35552,170188,764134,282
Merchant solutions447,476310,0871,254,583780,333
514,831362,2571,443,347914,615
Gross profit608,909405,1481,788,4851,037,132
Operating expenses
Sales and marketing237,949147,608626,082447,320
Research and development221,028143,427580,471393,050
General and administrative128,72251,799273,790179,948
Transaction and loan losses25,31111,75353,90339,202
Total operating expenses613,010354,5871,534,2461,059,520
(Loss) income from operations(4,101)50,561254,239(22,388)
Other income, net1,344,553135,8063,375,072152,999
Income before income taxes1,340,452186,3673,629,311130,611
(Provision for) recovery of income taxes(192,020)4,701(343,341)65,026
Net income1,148,432191,0683,285,970195,637
Other comprehensive (loss) income(9,193)4,190(14,660)(1,790)
Comprehensive income1,139,239195,2583,271,310193,847
Net income per share attributable to shareholders:
Basic9.18 1.59 26.44 1.65 
Diluted9.00 1.54 25.84 1.59 
Shares used to compute net income per share attributable to shareholders:
Basic125,071,460120,511,484124,297,069118,692,898
Diluted127,619,188124,908,279127,263,746123,399,606



Shopify Inc.
Condensed Consolidated Balance Sheets
(Expressed in US $000’s except share amounts, unaudited)
As at 
September 30, 2021December 31, 2020
$$
Assets
Current assets
Cash and cash equivalents2,189,613 2,703,597 
Marketable securities5,329,081 3,684,370 
Trade and other receivables, net151,773 120,752 
Merchant cash advances, loans and related receivables, net524,020 244,723 
Income taxes receivable57,372 56,067 
Other current assets80,892 68,247 
8,332,751 6,877,756 
Long-term assets
Property and equipment, net91,787 92,104 
Intangible assets, net141,929 135,676 
Right-of-use assets, net123,414 119,373 
Deferred tax assets52,073 52,677 
Equity and other investments ($3,916,910 and $nil, at fair value)4,445,132 173,454 
Goodwill349,432 311,865 
5,203,767 885,149 
Total assets13,536,518 7,762,905 
Liabilities and shareholders’ equity
Current liabilities
Accounts payable and accrued liabilities350,588 300,795 
Income taxes payable26,498 19,677 
Deferred revenue203,853 107,809 
Lease liabilities15,618 10,051 
596,557 438,332 
Long-term liabilities
Deferred revenue174,483 21,006 
Lease liabilities174,190 144,836 
Convertible senior notes910,376 758,008 
Deferred tax liabilities310,635 — 
1,569,684 923,850 
Commitments and contingencies
Shareholders’ equity
Common stock, unlimited Class A subordinate voting shares authorized, 113,607,328 and 110,929,570 issued and outstanding; unlimited Class B multiple voting shares authorized, 11,967,828 and 11,599,301 issued and outstanding7,930,690 6,115,232 
Additional paid-in capital136,024 261,436 
Accumulated other comprehensive (loss) income(5,890)8,770 
Retained earnings3,309,453 15,285 
Total shareholders’ equity11,370,277 6,400,723 
Total liabilities and shareholders’ equity13,536,518 7,762,905 




Shopify Inc.
Condensed Consolidated Statements of Cash Flows
(Expressed in US $000’s, unaudited)
Nine months ended
September 30, 2021September 30, 2020
$$
Cash flows from operating activities
Net income for the period3,285,970195,637
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization and depreciation44,06752,167
Stock-based compensation232,454179,883
Amortization of debt offering costs1,7561,200
Impairment of right-of-use assets and leasehold improvements30,14531,623
Provision for transaction and loan losses25,72319,954
Deferred income tax expense306,8495,598
Revenue related to non-cash consideration(37,425)(1,738)
Net unrealized gain on equity and other investments(3,369,535)(133,239)
Unrealized foreign exchange loss (gain)3,741(1,186)
Changes in operating assets and liabilities:
Trade and other receivables(30,267)(21,053)
Merchant cash advances, loans and related receivables(307,245)(112,447)
Other current assets(27,301)(17,441)
Non-cash consideration received in exchange for services(257,577)(24,710)
Accounts payable and accrued liabilities39,39286,067
Income tax assets and liabilities13,593(139,936)
Deferred revenue286,94658,935
Lease assets and liabilities2,684278
Net cash provided by operating activities243,970179,592
Cash flows from investing activities
Purchase of marketable securities(5,616,479)(3,661,092)
Maturity of marketable securities3,965,7552,436,216
Purchase of equity and other investments(642,566)(10,051)
Acquisitions of property and equipment(24,813)(35,377)
Acquisitions of intangible assets(262)
Acquisition of businesses, net of cash acquired(49,800)
Net cash used in investing activities(2,367,903)(1,270,566)
Cash flows from financing activities
Proceeds from public equity offerings, net of issuance costs1,541,1682,578,591
Proceeds from convertible senior notes, net of underwriting fees and offering costs907,950
Proceeds from the exercise of stock options72,44450,076
Net cash provided by financing activities1,613,6123,536,617
Effect of foreign exchange on cash and cash equivalents(3,663)(5,675)
Net (decrease) increase in cash and cash equivalents(513,984)2,439,968
Cash and cash equivalents – Beginning of Period2,703,597649,916
Cash and cash equivalents – End of Period2,189,6133,089,884



Shopify Inc.
Reconciliation from GAAP to Non-GAAP Results
(Expressed in US $000’s, except share and per share amounts, unaudited)
Three months endedNine months ended
September 30, 2021September 30, 2020September 30, 2021September 30, 2020
$$$$
GAAP Gross profit608,909 405,148 1,788,485 1,037,132 
% of Revenue54 %53 %55 %53 %
add: stock-based compensation1,699 2,667 4,851 5,003 
add: payroll taxes related to stock-based compensation288 247 796 764 
add: amortization of acquired intangibles5,536 4,531 14,439 14,956 
Non-GAAP Gross profit616,432 412,593 1,808,571 1,057,855 
% of Revenue55 %54 %56 %54 %
GAAP Sales and marketing237,949 147,608 626,082 447,320 
% of Revenue21 %19 %19 %23 %
less: stock-based compensation10,329 10,094 28,853 31,914 
less: payroll taxes related to stock-based compensation1,344 1,387 4,695 4,432 
less: amortization of acquired intangibles386 388 1,158 1,164 
Non-GAAP Sales and marketing225,890 135,739 591,376 409,810 
% of Revenue20 %18 %18 %21 %
GAAP Research and development221,028 143,427 580,471 393,050 
% of Revenue20 %19 %18 %20 %
less: stock-based compensation54,194 39,407 147,230 111,372 
less: payroll taxes related to stock-based compensation9,646 8,334 28,625 22,615 
less: amortization of acquired intangibles58 58 174 174 
Non-GAAP Research and development157,130 95,628 404,442 258,889 
% of Revenue14 %12 %13 %13 %
GAAP General and administrative128,722 51,799 273,790 179,948 
% of Revenue11 %%%%
less: stock-based compensation15,118 11,639 51,520 31,594 
less: payroll taxes related to stock-based compensation15,520 1,627 21,082 4,121 
less: impairment of right-of-use assets and leasehold improvements30,145 — 30,145 31,623 
Non-GAAP General and administrative67,939 38,533 171,043 112,610 
% of Revenue%%%%
GAAP Transaction and loan losses25,311 11,753 53,903 39,202 
% of Revenue%%%%
GAAP Operating expenses613,010 354,587 1,534,246 1,059,520 
% of Revenue55 %46 %47 %54 %
less: stock-based compensation79,641 61,140 227,603 174,880 
less: payroll taxes related to stock-based compensation26,510 11,348 54,402 31,168 
less: amortization of acquired intangibles444 446 1,332 1,338 
less: impairment of right-of-use assets and leasehold improvements30,145 — 30,145 31,623 
Non-GAAP Operating expenses476,270 281,653 1,220,764 820,511 
% of Revenue42 %37 %38 %42 %




Shopify Inc.
Reconciliation from GAAP to Non-GAAP Results (continued)
(Expressed in US $000’s, except share and per share amounts, unaudited)
Three months endedNine months ended
September 30, 2021September 30, 2020September 30, 2021September 30, 2020
$$$$
GAAP Operating (loss) income(4,101)50,561 254,239 (22,388)
% of Revenue%%%(1)%
add: stock-based compensation81,340 63,807 232,454 179,883 
add: payroll taxes related to stock-based compensation26,798 11,595 55,198 31,932 
add: amortization of acquired intangibles5,980 4,977 15,771 16,294 
add: impairment of right-of-use assets and leasehold improvements30,145 — 30,145 31,623 
Adjusted Operating income140,162 130,940 587,807 237,344 
% of Revenue12 %17 %18 %12 %
GAAP Net income1,148,432 191,068 3,285,970 195,637 
% of Revenue102 %25 %102 %10 %
add: stock-based compensation81,340 63,807 232,454 179,883 
add: payroll taxes related to stock-based compensation26,798 11,595 55,198 31,932 
add: amortization of acquired intangibles5,980 4,977 15,771 16,294 
add: amortization of debt discount— 1,130 — 1,130 
less: net unrealized gain on equity and other investments(1,340,842)(133,239)(3,369,535)(133,239)
add: impairment of right-of-use assets and leasehold improvements30,145 — 30,145 31,623 
add: income tax effects related to non-GAAP adjustments150,967 1,416 391,541 (30,808)
Adjusted Net income102,820 140,754 641,544 292,452 
% of Revenue%18 %20 %15 %
Basic GAAP Net income per share attributable to shareholders9.18 1.59 26.44 1.65 
add: stock-based compensation0.65 0.53 1.87 1.52 
add: payroll taxes related to stock-based compensation0.21 0.10 0.44 0.27 
add: amortization of acquired intangibles0.05 0.04 0.13 0.14 
add: amortization of debt discount0.00 0.01 0.00 0.01 
less: net unrealized gain on equity and other investments(10.72)(1.11)(27.11)(1.12)
add: impairment of right-of-use assets and leasehold improvements0.24 0.00 0.24 0.27 
add: income tax effects related to non-GAAP adjustments1.21 0.01 3.15 (0.26)
Basic Adjusted Net income per share attributable to shareholders0.82 1.17 5.16 2.46 
Weighted average shares used to compute GAAP and non-GAAP basic net income per share attributable to shareholders125,071,460 120,511,484 124,297,069 118,692,898 
Diluted GAAP Net income per share attributable to shareholders9.00 1.54 25.84 1.59 
add: stock-based compensation0.64 0.51 1.83 1.46 
add: payroll taxes related to stock-based compensation0.21 0.09 0.43 0.26 
add: amortization of acquired intangibles0.05 0.04 0.12 0.13 
add: amortization of debt discount0.00 0.01 0.00 0.01 
less: net unrealized gain on equity and other investments(10.51)(1.07)(26.48)(1.08)
add: impairment of right-of-use assets and leasehold improvements0.24 0.00 0.24 0.26 
add: income tax effects related to non-GAAP adjustments1.18 0.01 3.08 (0.25)
Diluted Adjusted Net income per share attributable to shareholders0.81 1.13 5.06 2.37 
Weighted average shares used to compute GAAP and non-GAAP diluted net income per share attributable to shareholders127,619,188124,908,279127,263,746123,399,606