Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2023 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | MNTV | |
Entity Registrant Name | Momentive Global Inc. | |
Entity Central Index Key | 0001739936 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 150,689,947 | |
Entity File Number | 001-38664 | |
Entity Tax Identification Number | 80-0765058 | |
Entity Address, Address Line One | One Curiosity Way | |
Entity Address, City or Town | San Mateo | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94403 | |
City Area Code | 650 | |
Local Phone Number | 543-8400 | |
Entity Incorporation, State or Country Code | DE | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common Stock, par value $0.00001 per share | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Security Exchange Name | NASDAQ |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 199,080 | $ 202,816 |
Accounts receivable, net of allowance of $1,020 and $1,121 | 31,760 | 33,656 |
Deferred commissions, current | 9,965 | 9,775 |
Prepaid expenses and other current assets | 15,769 | 17,207 |
Total current assets | 256,574 | 263,454 |
Property and equipment, net | 630 | 1,006 |
Operating lease right-of-use assets | 31,232 | 32,252 |
Capitalized internal-use software, net | 29,942 | 29,595 |
Acquisition intangible assets, net | 4,785 | 5,156 |
Goodwill | 460,979 | 459,817 |
Deferred commissions, non-current | 13,595 | 14,307 |
Other assets | 4,459 | 4,568 |
Total assets | 802,196 | 810,155 |
Current liabilities: | ||
Accounts payable | 9,688 | 16,418 |
Accrued expenses and other current liabilities | 26,759 | 24,969 |
Accrued compensation | 23,605 | 31,893 |
Deferred revenue, current | 215,865 | 206,728 |
Operating lease liabilities, current | 8,033 | 8,046 |
Debt, current | 1,900 | 1,900 |
Total current liabilities | 285,850 | 289,954 |
Deferred revenue, non-current | 641 | 719 |
Deferred tax liabilities | 6,641 | 6,337 |
Debt, non-current | 182,441 | 182,916 |
Operating lease liabilities, non-current | 37,874 | 39,584 |
Other non-current liabilities | 3,890 | 3,885 |
Total liabilities | 517,337 | 523,395 |
Commitments and contingencies (Note 11) | ||
Stockholders’ equity: | ||
Preferred stock ($0.00001 par value; 100,000 shares authorized; no shares issued and outstanding) | 0 | 0 |
Common stock ($0.00001 par value; 800,000 shares authorized; 150,690 and 149,711 shares issued and outstanding) | 2 | 1 |
Additional paid-in capital | 1,018,529 | 997,621 |
Accumulated other comprehensive loss | (2,420) | (3,425) |
Accumulated deficit | (731,252) | (707,437) |
Total stockholders’ equity | 284,859 | 286,760 |
Total liabilities and stockholders’ equity | $ 802,196 | $ 810,155 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Allowance for accounts receivable | $ 1,020 | $ 1,121 |
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 800,000,000 | 800,000,000 |
Common stock, shares issued (in shares) | 150,690,000 | 149,711,000 |
Common stock, shares outstanding (in shares) | 150,690,000 | 149,711,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Income Statement [Abstract] | |||
Revenue | $ 118,821 | $ 116,986 | |
Cost of revenue | [1],[2],[3] | 20,557 | 22,903 |
Gross profit | 98,264 | 94,083 | |
Operating expenses: | |||
Research and development | [1],[3] | 32,665 | 36,716 |
Sales and marketing | [1],[2],[3] | 47,919 | 59,636 |
General and administrative | [1],[3] | 31,737 | 27,917 |
Restructuring | [1],[2] | 7,197 | 4,883 |
Total operating expenses | 119,518 | 129,152 | |
Loss from operations | (21,254) | (35,069) | |
Interest expense | 4,148 | 2,226 | |
Other non-operating income, net | (2,038) | (134) | |
Loss before income taxes | (23,364) | (37,161) | |
Provision for income taxes | 451 | 216 | |
Net loss | $ (23,815) | $ (37,377) | |
Net loss per common share, basic | $ (0.16) | $ (0.25) | |
Net loss per common share, diluted | $ (0.16) | $ (0.25) | |
Weighted average number of basic shares outstanding | 149,345 | 150,262 | |
Weighted average number of diluted shares outstanding | 149,345 | 150,262 | |
[1] (1) Includes stock-based compensation, net of amounts capitalized as follows: (2) Includes amortization of acquisition intangible assets as follows: (3) Includes transaction expenses associated with the pending merger with an investor consortium led by STG during the three months ended March 31, 2023. See Note 1 for additional information. Also includes transaction expenses associated with the terminated merger with Zendesk, Inc. (“Zendesk”) during the three months ended March 31, 2022: |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Allocated share-based compensation expense | $ 20,402 | $ 26,254 |
Amortization of acquisition intangible assets | 371 | 2,911 |
Acquisition-related transaction costs | 7,461 | 6,500 |
Cost of revenue | ||
Allocated share-based compensation expense | 1,241 | 1,409 |
Amortization of acquisition intangible assets | 0 | 1,414 |
Acquisition-related transaction costs | 10 | 318 |
Research and development | ||
Allocated share-based compensation expense | 7,734 | 8,644 |
Acquisition-related transaction costs | 47 | 1,770 |
Sales and marketing | ||
Allocated share-based compensation expense | 4,075 | 6,065 |
Amortization of acquisition intangible assets | 371 | 1,452 |
Acquisition-related transaction costs | 23 | 1,679 |
General and administrative | ||
Allocated share-based compensation expense | 7,352 | 7,375 |
Acquisition-related transaction costs | 7,381 | 2,733 |
Restructuring expense | ||
Allocated share-based compensation expense | 0 | 2,761 |
Amortization of acquisition intangible assets | $ 0 | $ 45 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (unaudited) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (23,815) | $ (37,377) | |
Other comprehensive income (loss): | |||
Foreign currency translation adjustment | [1] | 1,005 | (947) |
Total other comprehensive income (loss) | [1] | 1,005 | (947) |
Total comprehensive loss | $ (22,810) | $ (38,324) | |
[1] Net of tax effect which was not material. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | |
Beginning balance at Dec. 31, 2021 | $ 354,474 | $ 2 | $ 971,604 | $ 414 | $ (617,546) | |
Beginning balance, Shares at Dec. 31, 2021 | 150,398,000 | |||||
Common stock issued upon vesting of restricted stock units, Shares | 877,000 | |||||
Common stock issued upon vesting of restricted stock units | 0 | $ 0 | 0 | 0 | 0 | |
Common stock issued upon stock option exercise, Shares | 164,000 | |||||
Common stock issued upon stock option exercise | 2,273 | $ 0 | 2,273 | 0 | 0 | |
Issuance of restricted stock awards, Shares | 1,031,000 | |||||
Issuance of restricted stock awards | 0 | $ 0 | 0 | 0 | 0 | |
Issuance of performance stock awards, Shares | 361,000 | |||||
Issuance of performance stock awards | 0 | $ 0 | 0 | 0 | 0 | |
Repurchases of common stock, Shares | (2,411,000) | |||||
Repurchases of common stock, Value | (36,376) | $ 0 | (36,376) | 0 | 0 | |
Stock-based compensation expense | 26,973 | 0 | 26,973 | 0 | 0 | |
Comprehensive income (loss) | (947) | [1] | 0 | 0 | (947) | 0 |
Net loss | (37,377) | 0 | 0 | 0 | (37,377) | |
Ending balance at Mar. 31, 2022 | 309,020 | $ 2 | 964,474 | (533) | (654,923) | |
Ending balance, Shares at Mar. 31, 2022 | 150,420,000 | |||||
Beginning balance at Dec. 31, 2022 | 286,760 | $ 1 | 997,621 | (3,425) | (707,437) | |
Beginning balance, Shares at Dec. 31, 2022 | 149,711,000 | |||||
Common stock issued upon vesting of restricted stock units, Shares | 979,000 | |||||
Common stock issued upon vesting of restricted stock units | $ 1 | $ 1 | 0 | 0 | 0 | |
Common stock issued upon stock option exercise, Shares | 0 | |||||
Repurchases of common stock, Shares | 0 | |||||
Stock-based compensation expense | $ 20,908 | 0 | 20,908 | 0 | 0 | |
Comprehensive income (loss) | 1,005 | [1] | 0 | 0 | 1,005 | 0 |
Net loss | (23,815) | 0 | 0 | 0 | (23,815) | |
Ending balance at Mar. 31, 2023 | $ 284,859 | $ 2 | $ 1,018,529 | $ (2,420) | $ (731,252) | |
Ending balance, Shares at Mar. 31, 2023 | 150,690,000 | |||||
[1] Net of tax effect which was not material. |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities | ||
Net loss | $ (23,815) | $ (37,377) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 5,710 | 9,354 |
Non-cash leases expense | 2,182 | 3,202 |
Stock-based compensation expense, net of amounts capitalized | 20,402 | 26,254 |
Deferred income taxes | 304 | 217 |
Bad debt expense | 497 | 644 |
Unrealized foreign currency (gains) losses, net and other | (195) | 727 |
Changes in assets and liabilities: | ||
Accounts receivable | 1,334 | (1,047) |
Prepaid expenses and other assets | (7,090) | (8,117) |
Accounts payable and accrued liabilities | (5,024) | (2,341) |
Accrued compensation | (8,368) | (6,898) |
Deferred revenue | 9,033 | 14,283 |
Operating lease liabilities | (2,897) | (3,801) |
Net cash used in operating activities | (7,927) | (4,900) |
Cash flows from investing activities | ||
Purchases of property and equipment | (15) | (441) |
Capitalized internal-use software | (2,079) | (2,565) |
Proceeds from sale of a private company investment | 6,753 | 0 |
Net cash provided by (used in) investing activities | 4,659 | (3,006) |
Cash flows from financing activities | ||
Proceeds from stock option exercises | 0 | 2,273 |
Payments to repurchase common stock | 0 | (36,376) |
Repayment of debt | (550) | (25,550) |
Net cash used in financing activities | (550) | (59,653) |
Effect of exchange rate changes on cash | 213 | 393 |
Net decrease in cash, cash equivalents and restricted cash | (3,605) | (67,166) |
Cash, cash equivalents and restricted cash at beginning of period | 203,258 | 306,121 |
Cash, cash equivalents and restricted cash at end of period | 199,653 | 238,955 |
Supplemental cash flow data: | ||
Interest paid for term debt | 3,967 | 2,009 |
Non-cash investing and financing transaction: | ||
Stock compensation included in capitalized software costs | $ 506 | $ 719 |
Company Overview and Basis of P
Company Overview and Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Company Overview and Basis of Presentation | 1. Company Overview and Basis of Presentation Business Momentive Global Inc. (the “Company”) provides Software-as-a-Service (“SaaS”) solutions that enable organizations to collect and analyze market, customer and employee sentiment data quickly and at scale. The Company offers three product categories, Surveys, Customer Experience, and Insights Solutions, that address three major business use cases: (i) building market leadership, (ii) delighting customers, and (iii) engaging employees. The Company was incorporated in 2011 as SVMK Inc., a Delaware corporation, and is the successor to operations originally started in 1999. In June 2021, SVMK Inc. was rebranded and changed its legal name to Momentive Global Inc. As a result, its common stock began trading under the ticker symbol “MNTV” instead of “SVMK” on The Nasdaq Global Select Market. In February 2022, the company announced plans to consolidate its product portfolio under two brands and web surfaces—Momentive and SurveyMonkey. The Momentive brand represents the Company's suite of upmarket solutions, while SurveyMonkey represents the Company's complementary products for value-oriented customers who prioritize speed and ease of use. The Company’s headquarters are located in the United States and its international operations are primarily based in Ireland, Canada and the Netherlands . Pending Merger with an investor consortium led by STG On March 13, 2023, the Company entered into the Agreement and Plan of Merger (the “Merger Agreement”), by and among the Company, STG and Mercury Merger Sub, Inc. (“Merger Sub”). Pursuant to the Merger Agreement, and upon the terms and subject to the conditions therein, Merger Sub will merge with and into the Company (the “Merger”), with the Company surviving the Merger as a wholly owned subsidiary of STG. The Company’s board of directors and the board of directors of STG have approved the Merger Agreement and the transactions contemplated by the Merger Agreement. Pursuant to the Merger Agreement, at the effective time of the Merger, each issued and outstanding share of the Company’s common stock (except for certain shares of the Company’s common stock specified in the Merger Agreement) will be canceled and automatically converted into the right to receive cash in an amount equal to $ 9.46 per share, without interest. Under the terms of the Merger Agreement, the completion of the Merger is subject to certain customary closing conditions, including, among others: (i) the adoption of the Merger Agreement by the holders of a majority of the outstanding shares of the Company’s common stock; (ii) the expiration or early termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the receipt of certain other specified regulatory approvals; and (iii) the absence of an order or law preventing the Merger. Each of STG and the Company may terminate the Merger Agreement under certain specified circumstances, including but not limited to, (i) if the Merger is not consummated by 11:59 p.m. (California time) on September 13, 2023, (ii) a governmental authority of competent jurisdiction has issued a final non-appealable governmental order preventing, materially restraining, or materially impairing the consummation of the Merger, or (iii) if the required approval of the Company’s stockholders is not obtained. STG may also terminate the Merger Agreement in certain additional limited circumstances, including if the Company’s board of directors changes its recommendation to the Company’s stockholders to vote in favor of the adoption of the Merger Agreement. If the Merger Agreement is terminated, the Company may be required to pay STG a termination fee of up to $ 52.0 million under certain circumstances. The foregoing summary of the Merger Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement, which is filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (“SEC”) on March 14, 2023. Other than transaction expenses related to legal, accounting, financial advisory, employee retention and other costs associated with the pending Merger of $ 7.5 million for the three months ended March 31, 2023, the terms of the Merger Agreement did not impact the Company's condensed consolidated financial statements. Principles of Consolidation and Basis of Presentation The accompanying interim condensed consolidated balance sheet as of March 31, 2023, the statements of operations, comprehensive loss, stockholders’ equity and cash flows for the three months ended March 31, 2023 and 2022 are unaudited. Such condensed consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. These condensed consolidated financial statements include the results of operations of the Company and its wholly-owned subsidiaries. All significant intercompany transactions have been eliminated . Certain other prior year balances have been reclassified to conform to the current year presentation. Such reclassifications did not affect our results of operations or operating, investing and financing cash flows. These condensed consolidated financial statements do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. In management’s opinion, the condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and include all normal recurring adjustments necessary for the fair presentation of the Company’s financial position as of March 31, 2023, the results of operations and cash flows for the three months ended March 31, 2023 and 2022. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year or any other future interim or annual periods. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Form 10-K filed with the SEC on February 17, 2023. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and reported amounts of revenue and expenses during the reporting periods covered by the condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates due to a variety of factors. The Company is not aware of any specific event or circumstances that would require an update to its estimates, judgments or assumptions or a revision to the carrying value of its assets or liabilities as of the date of issuance of its financial statements. These estimates, judgments and assumptions may change in the future, as new events occur or additional information is obtained. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable. The Company’s most significant estimates and use of judgment involve the determination of distinct performance obligations in enterprise customer contracts, the valuation of acquired goodwill and intangibles from acquisitions and the fair value of goodwill, right-of-use assets and other long-lived assets when evaluating for impairments. Segment Information The Company operates as a single operating segment. The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer, who reviews the Company’s operating results on a consolidated basis in order to make decisions about allocating resources and assessing performance for the entire company. The CODM uses one measure of profitability and does not segment the Company’s business for internal reporting. See Note 4 for additional information regarding the Company’s revenue by geographic area. Related Party Transactions Certain members of the Company’s board of directors serve as board members, are executive officers of and/or (in some cases) are investors in companies that are customers and/or vendors of the Company. The Company incurred related party expenses of $ 0.7 million and $ 0.9 million during the three months ended March 31, 2023 and 2022, respectively. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies There have been no material changes in our significant accounting policies as described in our Annual Report on Form 10-K for the year ended December 31, 2022. Other Non-Operating (Income) Expense Other non-operating (income) expense, net consists primarily of interest income, net foreign currency exchange (gains) losses, net realized gains and losses related to investments, and other (income) expense. The components of other non-operating (income) expense recognized in the condensed consolidated financial statements is as follows: Three Months Ended March 31, (in thousands) 2023 2022 Interest income $ ( 2,141 ) $ ( 165 ) Foreign currency (gains) losses, net 130 127 Other income, net ( 27 ) ( 96 ) Other non-operating income, net $ ( 2,038 ) $ ( 134 ) Accounting Pronouncement Recently Adopted Reference Rate Reform : In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . ASU 2020-04 is intended to provide temporary optional expedients and exceptions to the GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. This guidance is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2024. The Company adopted this guidance in the first quarter of fiscal 2023. On March 1, 2023, the Company amended the Refinancing Facility Agreement entered into in October 2018 (the “2018 Credit Facility”) by changing the reference rate from LIBOR to the Secured Overnight Financing Rate (“SOFR”) and elected to apply the practical expedient provided in Topic 848 to account for the modification as if it was not substantial. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. |
Revenue and Deferred Revenue
Revenue and Deferred Revenue | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue and Deferred Revenue | 3. Revenue and Deferred Revenue Disaggregated revenue Revenue by sales channel was as follows: Three Months Ended March 31, (in thousands) 2023 2022 Self-serve revenue $ 72,099 $ 75,803 Sales-assisted revenue 46,722 41,183 Revenue $ 118,821 $ 116,986 Self-serve revenues are generated from products purchased independently through our website. Sales-assisted revenues are generated from products sold to organizations through our sales team. In addition, see Note 4 for information regarding the Company’s revenue by geographic area. Deferred revenue The Company recognized into revenue $ 92.9 million and $ 88.6 million during the three months ended March 31, 2023 and 2022, respectively, that was included in the deferred revenue balances at the beginning of each respective period. Transaction price allocated to the remaining performance obligations As of March 31, 2023, future estimated revenue related to non-cancelable performance obligations that are unsatisfied or partially unsatisfied at the end of the reporting period was $ 245.5 million. The substantial majority of the unsatisfied performance obligations will be satisfied over the next twelve months . |
Geographical Information
Geographical Information | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Geographical Information | 4. Geographical Information Revenue by geography is generally based on the billing address of the customer. For purposes of its geographic revenue disclosure, the Company defines a customer as an organization. An organization may consist of an individual paying user, multiple paying users within an organization or the organization itself. The following table sets forth the percentage of revenue by geographic area: Three Months Ended March 31, 2023 2022 United States 66 % 64 % Rest of world 34 % 36 % No other country outside of the United States comprised 10% or greater of the Company’s revenue for each of the three months ended March 31, 2023 and 2022, respectively. |
Cash and Cash Equivalents
Cash and Cash Equivalents | 3 Months Ended |
Mar. 31, 2023 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents | 5. Cash and Cash Equivalents As of March 31, 2023 and December 31, 2022, the following table provides a reconciliation of the amount of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets to the total of such amounts shown in the condensed consolidated statements of cash flows: (in thousands) March 31, 2023 December 31, 2022 Cash and cash equivalents $ 199,080 $ 202,816 Restricted cash included in prepaid expenses and other current assets 573 442 Total cash, cash equivalents and restricted cash $ 199,653 $ 203,258 Included in cash and cash equivalents are cash in transit from payment processors for credit and debit card transactions of $ 2.2 million and $ 1.1 million as of March 31, 2023 and December 31, 2022 , respectively. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. Fair Value Measurements Assets and liabilities recorded at fair value in the condensed consolidated financial statements are categorized based on the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels which directly relate to the amount of subjectivity associated with the inputs to the valuation of these assets or liabilities are as follows: Level 1 – Observable inputs, such as quoted prices in active markets for identical assets or liabilities. Level 2 – Observable inputs, other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The carrying amounts of the Company’s financial instruments, which generally include cash equivalents, accounts receivable and accounts payable, approximate their fair values due to their short maturities. Based on borrowing rates currently available to the Company for debt with similar terms and consideration of default and credit risk, the fair value of the Company’s debt was approximately $ 181.9 million and $ 180.1 million as of March 31, 2023 and December 31, 2022, respectively. As of March 31, 2023 and December 31, 2022, respectively, the Company did not have any significant financial instruments accounted for pursuant to ASC 820, Fair Value Measurement . |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 7. Property and Equipment As of March 31, 2023 and December 31, 2022, property and equipment consisted of the following: (in thousands) March 31, 2023 December 31, 2022 Computer equipment $ 7,422 $ 7,492 Leasehold improvements 44,623 45,710 Furniture, fixtures and other assets 7,584 7,565 Gross property and equipment 59,629 60,767 Less: Accumulated depreciation ( 58,999 ) ( 59,761 ) Property and equipment, net $ 630 $ 1,006 Depreciation expense was $ 0.4 million and $ 1.4 million during the three months ended March 31, 2023 and 2022, respectively. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | 8. Intangible Assets and Goodwill Acquisition intangible assets, net As of March 31, 2023 and December 31, 2022, intangible assets, net consisted of the following: March 31, 2023 December 31, 2022 (in thousands) Gross Accumulated Net Gross Accumulated Net Customer relationships $ 10,100 $ ( 5,315 ) $ 4,785 $ 10,100 $ ( 4,944 ) $ 5,156 Trade name 900 ( 900 ) — 900 ( 900 ) — Acquisition intangible assets, net $ 11,000 $ ( 6,215 ) $ 4,785 $ 11,000 $ ( 5,844 ) $ 5,156 Amortization expense was $ 0.4 million and $ 2.9 million during the three months ended March 31, 2023 and 2022, respectively. Goodwill The changes in the carrying amount of goodwill were as follows (in thousands): Balance as of December 31, 2022 $ 459,817 Foreign currency translation 1,162 Balance as of March 31, 2023 $ 460,979 Capitalized internal-use software As of March 31, 2023 and December 31, 2022, capitalized internal-use software consisted of the following: (in thousands) March 31, 2023 December 31, 2022 Gross capitalized internal-use software $ 45,078 $ 62,249 Less: Accumulated amortization ( 15,136 ) ( 32,654 ) Capitalized internal-use software, net $ 29,942 $ 29,595 Amortization expense related to capitalized internal-use software was $ 2.1 million and $ 2.8 million during the three months ended March 31, 2023 and 2022, respectively, and is included in cost of revenue in the condensed consolidated statements of operations. The decrease in gross capitalized internal-use software is due to the removal of $ 19.6 million of fully amortized capitalized internal-use software during the first quarter of 2023, offset by current quarter additions. Future amortization expense As of March 31, 2023, future amortization expense by year is expected to be as follows: (in thousands) Capitalized Acquisition Remainder of 2023 $ 5,085 $ 1,113 2024 4,964 1,483 2025 3,458 1,389 2026 279 800 Total amortization expense $ 13,786 $ 4,785 Future capitalized internal-use software amortization excludes $ 16.2 million of costs which are currently in the development phase. |
Stockholder's Equity and Employ
Stockholder's Equity and Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2023 | |
Stockholders Equity And Employee Benefit Plans [Abstract] | |
Stockholders' Equity and Employee Benefit Plans | 9. Stockholders' Equity and Employee Benefit Plans Common Stock Repurchases On February 26, 2022, the Company's board of directors authorized a share repurchase program to repurchase up to $ 200.0 million of the Company’s common stock in the open market or in privately negotiated transactions (through 10b5-1 trading plans or otherwise). The share repurchase program does not obligate the Company to acquire any particular amount of common stock and may be suspended at any time at the Company’s discretion, and the share repurchase program does not have an expiration date. The actual timing, number and value of shares repurchased is determined by management at its discretion and depends on a number of factors, including the market price of the Company’s stock, general business and market conditions, and other investment opportunities. There were no share repurchases for the three months ended March 31, 2023. During the three months ended March 31, 2022, the Company repurchased approximately 2.4 million shares of common stock for approximately $ 36.4 million . As of March 31, 2023, the Company’s remaining share repurchase authorization was approximately $ 116.5 million . Equity Incentive Plans The Company sponsors the 2018 Equity Incentive Plan (the “2018 Plan”), which was approved by stockholders on September 5, 2018. The purpose of the 2018 Plan is to promote the long-term growth and profitability of the Company by (i) providing employees with incentives to improve stockholder value and to contribute to the growth and financial success of the Company through their future services, and (ii) enabling the Company to attract, retain and reward the best available persons. The options granted under the 2018 Plan, may be granted at a price not less than the fair market value on the grant date. The board of directors, or a committee of the board of directors, has granted options with an exercise price at fair value on the grant date. Grants of time-based awards generally vest over a four-year period for new hires and over a three-year period for subsequent grants to existing employees. Options expire as determined by the board of directors, or committee of the board of directors, but not more than ten years after the date of the grant. As of March 31, 2023, 28,741,857 shares of common stock remain available for grant under the 2018 Plan. The following is a summary of restricted stock units for the current year period: Restricted Stock Units Number of Weighted Average Weighted Average Unvested at December 31, 2022 8,023,173 $ 15.07 1.2 Granted 563,320 $ 8.24 Vested ( 979,131 ) $ 17.52 Forfeited/cancelled ( 896,761 ) $ 14.56 Unvested at March 31, 2023 6,710,601 $ 14.21 1.2 The following is a summary of stock option activity for the current year period: Stock Options Number of Weighted Average Aggregate Weighted Average (in years) Outstanding at December 31, 2022 13,133,446 $ 16.24 $ — 4.2 Granted — $ — Exercised — $ — Forfeited ( 22,001 ) $ 20.18 Expired ( 2,325,356 ) $ 16.61 Outstanding, vested and expected to vest at March 31, 2023 10,786,089 $ 16.15 $ 1,918 4.7 Vested and exercisable at March 31, 2023 8,770,544 $ 16.59 $ — 4.7 The following is a summary of restricted stock awards for the current year period: Restricted Stock Awards Number of Weighted Average Weighted Average Unvested at December 31, 2022 890,219 $ 17.43 1.9 Granted — $ — Vested ( 80,905 ) $ 17.38 Forfeited/cancelled — $ — Unvested at March 31, 2023 809,314 $ 17.43 1.8 2018 Employee Stock Purchase Plan, As Amended The Company sponsors the 2018 Employee Stock Purchase Plan, as amended (the “ESPP”), which was approved by stockholders on September 5, 2018. The ESPP provides for 24 -month offering periods beginning May 22 and November 22 of each year, and each offering period will consist of four six-month purchase periods, subject to a reset provision. On each purchase date, eligible employees will purchase the shares at a price per share equal to 85 % of the lesser of (1) the fair market value of the Company’s common stock on the offering date, or (2) the fair market value of its common stock on the purchase date. As of March 31, 2023, 7,481,519 shares of common stock remain available for issuance under the ESPP. Stock-Based Compensation Expense Stock-based compensation expense recognized in the condensed consolidated financial statements is as follows: Three Months Ended March 31, (in thousands) 2023 2022 Cost of revenue $ 1,241 $ 1,409 Research and development 7,734 8,644 Sales and marketing 4,075 6,065 General and administrative 7,352 7,375 Restructuring — 2,761 Stock-based compensation expense, net of amounts capitalized 20,402 26,254 Capitalized stock-based compensation expense 506 719 Stock-based compensation expense $ 20,908 $ 26,973 As of March 31, 2023, unamortized stock-based compensation was as follows: Unrecognized Weighted (in years) Restricted stock units $ 86,935 2.0 Stock options 6,052 1.0 Restricted stock awards 8,407 1.8 ESPP 10,981 1.6 Total unrecognized stock-based compensation $ 112,375 401(k) Plan In the United States, the Company offers its employees a defined contribution plan that qualifies as a deferred salary arrangement under Section 401 of the U.S. Internal Revenue Code (“401(k) Plan”). Under the 401(k) Plan, participating employees may defer a portion of their pretax earnings not to exceed the maximum amount allowed by the Internal Revenue Service. The Company currently provides a matching contribution of 25 % of deferrals for eligible employees. Compensation expense for the Company's matching contributions was $ 1.7 million and $ 1.9 million during the three months ended March 31, 2023 and 2022, respectively. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Leases | 10. Leases The Company leases certain equipment and facilities under operating leases which expire at various dates through 2028 . The Company’s operating lease costs were as follows: Three Months Ended March 31, (in thousands) 2023 2022 Operating lease cost (gross lease expense) $ 2,273 $ 3,204 Variable lease costs 958 1,330 Sublease income (including reimbursed expenses) 491 846 During each of the three months ended March 31, 2023 and 2022, the Company’s short-term lease costs were nominal. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The weighted average remaining operating lease term was 5.5 years and 5.7 years as of March 31, 2023 and December 31, 2022, respectively. The weighted average discount rate used to estimate operating lease liabilities was 7.1 % as of March 31, 2023 and December 31, 2022, respectively. As of March 31, 2023, maturities of operating lease liabilities and sublease income, by year are as follows: (in thousands) Operating Lease Payments Sublease Remainder of 2023 $ 8,400 $ ( 1,318 ) 2024 9,753 ( 372 ) 2025 9,307 — 2026 9,516 — 2027 9,788 — Thereafter 9,363 — Gross lease payments (income) $ 56,127 $ ( 1,690 ) Less: Imputed interest 9,802 Less: Tenant improvement receivables 418 Total operating lease liabilities $ 45,907 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies Non-Cancelable Purchase Commitments The Company enters into commitments under non-cancelable purchase orders for the procurement of goods and services in the ordinary course of business. As of March 31, 2023, expected payments under such commitments are as follows (in thousands): Remainder of 2023 $ 12,531 2024 8,082 2025 1,946 2026 49 2027 1 Total purchase commitments $ 22,609 Letters of Credit As of March 31, 2023 , the Company had a standby letter of credit for $ 1.0 million which was issued in connection with the San Mateo headquarters. Legal Matters The Company is party to lawsuits filed in connection with the Merger, and more may be filed. On April 21, 2023, a purported Momentive stockholder filed a complaint in the U.S. District Court for the Southern District of New York against Momentive and the Momentive board of directors, captioned O’Dell v. Momentive Global, Inc., et al. Case No. 23-cv-3360 (S.D.N.Y.) (the “O’Dell Complaint”), and a purported Momentive stockholder filed a complaint in the U.S. District Court for the Northern District of California against Momentive and the Momentive board of directors, captioned Renfer v. Momentive Global, Inc., et al. Case No. 3:23-cv-01936-TLT (N.D. Cal.) (the “Renfer Complaint”). On April 24, 2023, a purported Momentive stockholder filed a complaint in the U.S. District Court for the Southern District of New York against Momentive and the Momentive board of directors, captioned Wang v. Momentive Global, Inc., et al. Case No. 1:23-cv-03408 (S.D.N.Y.) (the “Wang Complaint”). On April 26, 2023, a purported Momentive stockholder filed a complaint in the U.S. District Court for the Northern District of California against Momentive and the Momentive board of directors, captioned DeVay v. Momentive Global, Inc., et al. Case No. 3:23-cv-02032 (N.D. Cal.) (the “DeVey Complaint”). On April 28, 2023, a purported Momentive stockholder filed a complaint in the U.S. District Court for the Northern District of California against Momentive and the Momentive board of directors, captioned Bushansky v. Momentive Global, Inc., et al. Case No. 3:23-cv-02068 (N.D. Cal.) (the “Bushansky Complaint”), and together with the O’Dell Complaint, the Renfer Complaint, the Wang Complaint and the DeVey Complaint, the “Momentive Complaints”). The Momentive Complaints assert claims against certain defendants under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder for allegedly false and misleading statements in the proxy statement and against certain defendants under Section 20(a) of the Exchange Act for alleged “control person” liability with respect to such allegedly false and misleading statements. Each complaint seeks, among other relief, an order enjoining the Merger and an award for plaintiffs’ fees and costs. The Company believes the allegations in the Momentive Complaints are without merit. Momentive stockholders may file additional lawsuits challenging the Merger, which may name the Company, members of the Company’s board of directors and/or other defendants. No assurance can be made as to the outcome of such lawsuits or the Momentive Complaints, including the amount of costs associated with defending against, or any other liabilities that may be incurred in connection with the litigation of, such claims. In addition, from time to time, the Company is subject to legal proceedings, claims and litigation arising in the ordinary course of business, which may include, but are not limited to, patent and privacy matters, labor and employment claims, class action lawsuits, as well as inquiries, investigations, audits and other regulatory proceedings. Periodically, the Company evaluates developments in its legal matters and records a liability when it believes that it is both probable that a loss has been incurred and the amount can be reasonably estimated. Significant judgment is required to determine both the likelihood of there being, and the estimated amount of, a loss related to such matters, and the Company's judgment may be incorrect. There are currently no legal matters or claims that have arisen from the normal course of business that the Company believes would have a material impact on the Company’s financial position, results of operations or cash flows. Warranties and Indemnification The Company’s subscription services are generally warranted to perform materially in accordance with the Company’s online help documentation under normal use and circumstances. Additionally, the Company’s arrangements generally include provisions for indemnifying customers against liabilities if its subscription services infringe a third party’s intellectual property rights. Furthermore, the Company may also incur liabilities if it breaches the security or confidentiality obligations in its arrangements. To date, the Company has not incurred significant costs and has not accrued a liability in the accompanying condensed consolidated financial statements as a result of these obligations. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | 12. Debt As of March 31, 2023 and December 31, 2022 the carrying values of debt were as follows: March 31, 2023 December 31, 2022 Issuance Maturity Amount (in thousands) Effective Amount (in thousands) Effective 2018 Credit Facility October 2018 October 2025 $ 185,100 8.1 % - 8.7 % $ 185,650 3.9 % - 8.1 % Less: Unamortized issuance discount and issuance costs, net 759 834 Less: Debt, current 1,900 1,900 Debt, non-current $ 182,441 $ 182,916 In October 2018, the Company entered into the 2018 Credit Facility, comprising a $ 220.0 million term loan (the “Term Loan”) and $ 75.0 million revolving credit facility. Effective March 1, 2023, the Company entered into an amendment to the 2018 Credit Facility to amend the alternate base interest rate ( “ABR”) from the LIBOR (as defined in the 2018 Credit Facility) to the SOFR and to make such other related changes. Loans under the amendment effective March 1, 2023 accrue interest based upon, at the Company’s option, either at an ABR or an adjusted term SOFR Rate, in each case, an applicable margin. The applicable margin for the Term Loan is 2.75 % in the case of a ABR loan and 3.75 % in the case of a Term Benchmark loan, and the applicable margin for the revolving loan ranges from 0.75 % to 1.50 % in the case of a ABR loan and 1.75 % to 2.50 % in the case of a Term Benchmark loan, and is based on the Company’s leverage ratio. The Company will make quarterly principal payments of $ 550,000 on the Term Loan with any remaining principal amounts due on October 10, 2025 . The principal amount on the revolving credit facility is due and all revolver commitments terminate on October 10, 2023 . As of March 31, 2023 , the Company had $ 74.0 million of borrowing available under the line of credit portion of the 2018 Credit Facility. The Company’s obligations under the 2018 Credit Facility are guaranteed by certain of its subsidiaries and secured by liens on substantially all of the assets of the Company and such subsidiaries. The 2018 Credit Facility contains financial, affirmative and negative covenants that, if violated, may require the Company to pay down the loans earlier than the stated maturity dates with higher interest rates. As of March 31, 2023, the Company was compliant with all of its debt covenant requirements in the 2018 Credit Facility. The Company believes that it will continue to comply with the terms of the loan agreements through the stated maturity dates. However, if the Company’s projections do not materialize, the Company may require additional equity or debt financing. There can be no assurance that additional financing, if required, will be available on terms satisfactory to the Company. As of March 31, 2023, future minimum payment obligations of principal amounts due by year under the 2018 Credit Facility were as follows (in thousands): Remainder of 2023 $ 1,650 2024 2,200 2025 181,250 Total principal outstanding $ 185,100 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. Income Taxes The Company recorded an income tax provision of $ 0.5 million and $ 0.2 million for the three months ended March 31, 2023 and 2022, respectively. The increase in the Company’s income tax expense for the three months ended March 31, 2023, relative to the prior year period, was primarily due to an estimated increase in U.S. state income taxes resulting from capitalization of certain expenses under Section 174. The Company regularly evaluates the realizability of its net deferred tax assets based on all available evidence, both positive and negative. The realization of net deferred tax assets is dependent on several factors, including the likelihood and amount, if any, of future taxable income in relevant jurisdictions during periods in which those temporary differences become deductible. As of March 31, 2023, the Company continues to maintain a valuation allowance on certain deferred tax assets in the United States and certain foreign jurisdictions that are not realizable on a more likely than not basis. The Company believes that it has provided adequate reserves for its income tax uncertainties in all open tax years. As the outcome of the audits cannot be predicted with certainty, if any issues addressed in the Company's tax audits are resolved in a manner inconsistent with management's expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. There were no material changes in gross unrecognized tax benefits during each of the three months ended March 31, 2023 and 2022. |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 14. Net Loss Per Share Basic earnings per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net loss for the period by the weighted-average number of common shares outstanding during the period which includes potential dilutive common shares assuming the dilutive effect of outstanding restricted stock units, stock options, restricted stock awards, and shares issuable under the ESPP calculated using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended March 31, (in thousands, except per share amounts) 2023 2022 Numerator: Net loss $ ( 23,815 ) $ ( 37,377 ) Denominator: Weighted-average shares outstanding - basic and diluted 149,345 150,262 Net loss per common share - basic and diluted: $ ( 0.16 ) $ ( 0.25 ) The Company was in a loss position for the periods presented. Accordingly, basic net loss per share is the same as diluted net loss per share as the inclusion of all potential common shares outstanding would have been anti-dilutive. Prior to application of the treasury stock method, share equivalents (comprising of restricted stock units, stock options, restricted stock awards, and shares issuable under the ESPP) excluded from the calculations of diluted net loss per share were 20.2 million and 26.3 million for the three months ended March 31, 2023 and 2022, respectively. |
Restructuring Costs
Restructuring Costs | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring Costs [Abstract] | |
Restructuring Costs | 15. Restructuring Costs A description of the Company's restructuring and other activities and their related costs is provided below. February 2023 Restructuring Plan In February 2023, the Company committed to a restructuring plan (the "February 2023 Restructuring Plan") that is designed to improve operating margin. The February 2023 Restructuring plan resulted in a reduction of the Company's workforce by approximately 14 %. The total estimated restructuring costs was approximately $ 7.2 million, consisting of cash expenditures for employee severance, employee benefits, and related facilitation costs, and was substantially recognized during the first quarter of 2023. October 2022 Restructuring Plan In October 2022, the Company committed to a plan designed to improve operating margin and create efficiencies in its go-to-market motion and in other areas throughout the Company (the “October 2022 Restructuring Plan”). The October 2022 Restructuring Plan resulted in a reduction of the Company’s workforce by approximately 11 %. The Company incurred total charges of approximately $ 4.2 million, consisting of cash expenditures for employee severance, employee benefits, and related facilitation costs, and was substantially recognized during the fourth quarter of 2022. March 2022 Restructuring Plan In March 2022, the Company implemented a restructuring plan (the “March 2022 Restructuring Plan”) to streamline its business, increase operating efficiency, and reduce costs over the long-term after the termination of its proposed merger with Zendesk. In connection with the March 2022 Restructuring Plan, the Company incurred total charges of approximately $ 2.4 million, which are primarily comprised of employee severance, stock-based compensation expense, gain on lease modification due to the partial termination of its San Mateo, CA headquarters lease and related leasehold improvement impairment costs, and other contract termination costs related to the Company's decision to abandon its future office expansion plans. Additionally, the Company has streamlined its brand positioning and accelerated the amortization of the brand-related intangibles that were discontinued. Substantially all of the costs related to the March 2022 Restructuring Plan has been recognized as of the fourth quarter of 2022. The restructuring plans were subject to applicable laws and consultation processes as part of the Company's strategic plan to reduce costs and improve efficiencies. In connection with these actions, the Company incurred the following pre-tax costs for the three months ended March 31, 2023 and 2022: Three Months Ended March 31, (in thousands) 2023 2022 Employee severance $ 7,197 $ 822 Stock-based compensation — 2,761 Contract termination and other costs — 1,255 Amortization of intangible assets — 45 Total restructuring costs $ 7,197 $ 4,883 Restructuring costs included $ 2.0 million recorded in accrued expenses and other current liabilities line in the condensed consolidated balance sheet as of March 31, 2023 . The majority of the amounts accrued pertain to severance costs which will be paid through the second quarter of 2023. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The accompanying interim condensed consolidated balance sheet as of March 31, 2023, the statements of operations, comprehensive loss, stockholders’ equity and cash flows for the three months ended March 31, 2023 and 2022 are unaudited. Such condensed consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. These condensed consolidated financial statements include the results of operations of the Company and its wholly-owned subsidiaries. All significant intercompany transactions have been eliminated . Certain other prior year balances have been reclassified to conform to the current year presentation. Such reclassifications did not affect our results of operations or operating, investing and financing cash flows. These condensed consolidated financial statements do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. In management’s opinion, the condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and include all normal recurring adjustments necessary for the fair presentation of the Company’s financial position as of March 31, 2023, the results of operations and cash flows for the three months ended March 31, 2023 and 2022. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year or any other future interim or annual periods. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Form 10-K filed with the SEC on February 17, 2023. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and reported amounts of revenue and expenses during the reporting periods covered by the condensed consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates due to a variety of factors. The Company is not aware of any specific event or circumstances that would require an update to its estimates, judgments or assumptions or a revision to the carrying value of its assets or liabilities as of the date of issuance of its financial statements. These estimates, judgments and assumptions may change in the future, as new events occur or additional information is obtained. The Company bases its estimates on historical experience and on various other assumptions that it believes to be reasonable. The Company’s most significant estimates and use of judgment involve the determination of distinct performance obligations in enterprise customer contracts, the valuation of acquired goodwill and intangibles from acquisitions and the fair value of goodwill, right-of-use assets and other long-lived assets when evaluating for impairments. |
Segment Information | Segment Information The Company operates as a single operating segment. The Company’s chief operating decision maker (“CODM”) is its Chief Executive Officer, who reviews the Company’s operating results on a consolidated basis in order to make decisions about allocating resources and assessing performance for the entire company. The CODM uses one measure of profitability and does not segment the Company’s business for internal reporting. See Note 4 for additional information regarding the Company’s revenue by geographic area. |
Related Party Transactions | Related Party Transactions Certain members of the Company’s board of directors serve as board members, are executive officers of and/or (in some cases) are investors in companies that are customers and/or vendors of the Company. The Company incurred related party expenses of $ 0.7 million and $ 0.9 million during the three months ended March 31, 2023 and 2022, respectively. |
Other Non-Operating (Income) Expense | Other Non-Operating (Income) Expense Other non-operating (income) expense, net consists primarily of interest income, net foreign currency exchange (gains) losses, net realized gains and losses related to investments, and other (income) expense. The components of other non-operating (income) expense recognized in the condensed consolidated financial statements is as follows: Three Months Ended March 31, (in thousands) 2023 2022 Interest income $ ( 2,141 ) $ ( 165 ) Foreign currency (gains) losses, net 130 127 Other income, net ( 27 ) ( 96 ) Other non-operating income, net $ ( 2,038 ) $ ( 134 ) |
Accounting Pronouncements Recently Adopted | Accounting Pronouncement Recently Adopted Reference Rate Reform : In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . ASU 2020-04 is intended to provide temporary optional expedients and exceptions to the GAAP guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. This guidance is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2024. The Company adopted this guidance in the first quarter of fiscal 2023. On March 1, 2023, the Company amended the Refinancing Facility Agreement entered into in October 2018 (the “2018 Credit Facility”) by changing the reference rate from LIBOR to the Secured Overnight Financing Rate (“SOFR”) and elected to apply the practical expedient provided in Topic 848 to account for the modification as if it was not substantial. The adoption of this ASU did not have a material impact on the Company's condensed consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Components of Other Non-Operating (Income) Expense Recognized in Condensed Consolidated Financial Statements | The components of other non-operating (income) expense recognized in the condensed consolidated financial statements is as follows: Three Months Ended March 31, (in thousands) 2023 2022 Interest income $ ( 2,141 ) $ ( 165 ) Foreign currency (gains) losses, net 130 127 Other income, net ( 27 ) ( 96 ) Other non-operating income, net $ ( 2,038 ) $ ( 134 ) |
Revenue and Deferred Revenue (T
Revenue and Deferred Revenue (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregated Revenue by Sales Channel | Revenue by sales channel was as follows: Three Months Ended March 31, (in thousands) 2023 2022 Self-serve revenue $ 72,099 $ 75,803 Sales-assisted revenue 46,722 41,183 Revenue $ 118,821 $ 116,986 |
Geographical Information (Table
Geographical Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Percentage of Revenue by Geographic Area | The following table sets forth the percentage of revenue by geographic area: Three Months Ended March 31, 2023 2022 United States 66 % 64 % Rest of world 34 % 36 % |
Cash and Cash Equivalents (Tabl
Cash and Cash Equivalents (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents [Abstract] | |
Schedule of Reconciliation of the Amount of Cash, Cash Equivalents, and Restricted Cash | As of March 31, 2023 and December 31, 2022, the following table provides a reconciliation of the amount of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets to the total of such amounts shown in the condensed consolidated statements of cash flows: (in thousands) March 31, 2023 December 31, 2022 Cash and cash equivalents $ 199,080 $ 202,816 Restricted cash included in prepaid expenses and other current assets 573 442 Total cash, cash equivalents and restricted cash $ 199,653 $ 203,258 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | As of March 31, 2023 and December 31, 2022, property and equipment consisted of the following: (in thousands) March 31, 2023 December 31, 2022 Computer equipment $ 7,422 $ 7,492 Leasehold improvements 44,623 45,710 Furniture, fixtures and other assets 7,584 7,565 Gross property and equipment 59,629 60,767 Less: Accumulated depreciation ( 58,999 ) ( 59,761 ) Property and equipment, net $ 630 $ 1,006 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets, net | As of March 31, 2023 and December 31, 2022, intangible assets, net consisted of the following: March 31, 2023 December 31, 2022 (in thousands) Gross Accumulated Net Gross Accumulated Net Customer relationships $ 10,100 $ ( 5,315 ) $ 4,785 $ 10,100 $ ( 4,944 ) $ 5,156 Trade name 900 ( 900 ) — 900 ( 900 ) — Acquisition intangible assets, net $ 11,000 $ ( 6,215 ) $ 4,785 $ 11,000 $ ( 5,844 ) $ 5,156 As of March 31, 2023 and December 31, 2022, capitalized internal-use software consisted of the following: (in thousands) March 31, 2023 December 31, 2022 Gross capitalized internal-use software $ 45,078 $ 62,249 Less: Accumulated amortization ( 15,136 ) ( 32,654 ) Capitalized internal-use software, net $ 29,942 $ 29,595 |
Schedule of Carrying Amount of Goodwill | The changes in the carrying amount of goodwill were as follows (in thousands): Balance as of December 31, 2022 $ 459,817 Foreign currency translation 1,162 Balance as of March 31, 2023 $ 460,979 |
Summary of Future Amortization Expense | As of March 31, 2023, future amortization expense by year is expected to be as follows: (in thousands) Capitalized Acquisition Remainder of 2023 $ 5,085 $ 1,113 2024 4,964 1,483 2025 3,458 1,389 2026 279 800 Total amortization expense $ 13,786 $ 4,785 |
Stockholder's Equity and Empl_2
Stockholder's Equity and Employee Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Stock Option Activity | The following is a summary of stock option activity for the current year period: Stock Options Number of Weighted Average Aggregate Weighted Average (in years) Outstanding at December 31, 2022 13,133,446 $ 16.24 $ — 4.2 Granted — $ — Exercised — $ — Forfeited ( 22,001 ) $ 20.18 Expired ( 2,325,356 ) $ 16.61 Outstanding, vested and expected to vest at March 31, 2023 10,786,089 $ 16.15 $ 1,918 4.7 Vested and exercisable at March 31, 2023 8,770,544 $ 16.59 $ — 4.7 |
Summary of Stock-based Compensation Expense Recognized in Financial Statements | Stock-based compensation expense recognized in the condensed consolidated financial statements is as follows: Three Months Ended March 31, (in thousands) 2023 2022 Cost of revenue $ 1,241 $ 1,409 Research and development 7,734 8,644 Sales and marketing 4,075 6,065 General and administrative 7,352 7,375 Restructuring — 2,761 Stock-based compensation expense, net of amounts capitalized 20,402 26,254 Capitalized stock-based compensation expense 506 719 Stock-based compensation expense $ 20,908 $ 26,973 |
Summary of Unamortized Stock-based Compensation | As of March 31, 2023, unamortized stock-based compensation was as follows: Unrecognized Weighted (in years) Restricted stock units $ 86,935 2.0 Stock options 6,052 1.0 Restricted stock awards 8,407 1.8 ESPP 10,981 1.6 Total unrecognized stock-based compensation $ 112,375 |
Restricted Stock Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Restricted Stock Units and Restricted Stock Awards | The following is a summary of restricted stock units for the current year period: Restricted Stock Units Number of Weighted Average Weighted Average Unvested at December 31, 2022 8,023,173 $ 15.07 1.2 Granted 563,320 $ 8.24 Vested ( 979,131 ) $ 17.52 Forfeited/cancelled ( 896,761 ) $ 14.56 Unvested at March 31, 2023 6,710,601 $ 14.21 1.2 |
Restricted Stock Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of Restricted Stock Units and Restricted Stock Awards | The following is a summary of restricted stock awards for the current year period: Restricted Stock Awards Number of Weighted Average Weighted Average Unvested at December 31, 2022 890,219 $ 17.43 1.9 Granted — $ — Vested ( 80,905 ) $ 17.38 Forfeited/cancelled — $ — Unvested at March 31, 2023 809,314 $ 17.43 1.8 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Schedule of Operating Lease Costs | The Company’s operating lease costs were as follows: Three Months Ended March 31, (in thousands) 2023 2022 Operating lease cost (gross lease expense) $ 2,273 $ 3,204 Variable lease costs 958 1,330 Sublease income (including reimbursed expenses) 491 846 |
Schedule of Maturities of Operating Lease Liabilities and Sublease Income | As of March 31, 2023, maturities of operating lease liabilities and sublease income, by year are as follows: (in thousands) Operating Lease Payments Sublease Remainder of 2023 $ 8,400 $ ( 1,318 ) 2024 9,753 ( 372 ) 2025 9,307 — 2026 9,516 — 2027 9,788 — Thereafter 9,363 — Gross lease payments (income) $ 56,127 $ ( 1,690 ) Less: Imputed interest 9,802 Less: Tenant improvement receivables 418 Total operating lease liabilities $ 45,907 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Non-Cancelable Purchase Commitments | The Company enters into commitments under non-cancelable purchase orders for the procurement of goods and services in the ordinary course of business. As of March 31, 2023, expected payments under such commitments are as follows (in thousands): Remainder of 2023 $ 12,531 2024 8,082 2025 1,946 2026 49 2027 1 Total purchase commitments $ 22,609 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Carrying Values of Debt | As of March 31, 2023 and December 31, 2022 the carrying values of debt were as follows: March 31, 2023 December 31, 2022 Issuance Maturity Amount (in thousands) Effective Amount (in thousands) Effective 2018 Credit Facility October 2018 October 2025 $ 185,100 8.1 % - 8.7 % $ 185,650 3.9 % - 8.1 % Less: Unamortized issuance discount and issuance costs, net 759 834 Less: Debt, current 1,900 1,900 Debt, non-current $ 182,441 $ 182,916 |
Schedule of Future Minimum Payment Obligations of Principal Amounts Due | As of March 31, 2023, future minimum payment obligations of principal amounts due by year under the 2018 Credit Facility were as follows (in thousands): Remainder of 2023 $ 1,650 2024 2,200 2025 181,250 Total principal outstanding $ 185,100 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended March 31, (in thousands, except per share amounts) 2023 2022 Numerator: Net loss $ ( 23,815 ) $ ( 37,377 ) Denominator: Weighted-average shares outstanding - basic and diluted 149,345 150,262 Net loss per common share - basic and diluted: $ ( 0.16 ) $ ( 0.25 ) |
Restructuring Costs (Tables)
Restructuring Costs (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Restructuring Costs [Abstract] | |
Restructuring - pre-tax costs | The restructuring plans were subject to applicable laws and consultation processes as part of the Company's strategic plan to reduce costs and improve efficiencies. In connection with these actions, the Company incurred the following pre-tax costs for the three months ended March 31, 2023 and 2022: Three Months Ended March 31, (in thousands) 2023 2022 Employee severance $ 7,197 $ 822 Stock-based compensation — 2,761 Contract termination and other costs — 1,255 Amortization of intangible assets — 45 Total restructuring costs $ 7,197 $ 4,883 |
Company Overview and Basis of_2
Company Overview and Basis of Presentation - Business - Additional Information (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) Product $ / shares | |
Number of major product categories offering SaaS feedback solutions | Product | 3 |
Proposed Merger with STG Partners, LLC | |
Business merger, Share price | $ / shares | $ 9.46 |
Business merger, Transaction costs | $ 7.5 |
Momentive Global Inc. | |
Termination Fee | $ 52 |
Company Overview and Basis of_3
Company Overview and Basis of Presentation - Segment Information - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2023 Segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segment | 1 |
Company Overview and Basis of_4
Company Overview and Basis of Presentation - Related Party Transactions - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Related party expenses | $ 0.7 | $ 0.9 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Components of Other Non-Operating (Income) Expense Recognized in Condensed Consolidated Financial Statements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Nonoperating Income (Expense) [Abstract] | ||
Interest Income | $ (2,141) | $ (165) |
Foreign currency (gains) losses, net | 130 | 127 |
Other income, net | (27) | (96) |
Other non-operating income, net | $ (2,038) | $ (134) |
Revenue and Deferred Revenue -
Revenue and Deferred Revenue - Summary of Disaggregated Revenue by Sales Channel (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation Of Revenue [Line Items] | ||
Revenue | $ 118,821 | $ 116,986 |
Self-serve revenue | ||
Disaggregation Of Revenue [Line Items] | ||
Revenue | 72,099 | 75,803 |
Sales-assisted revenue | ||
Disaggregation Of Revenue [Line Items] | ||
Revenue | $ 46,722 | $ 41,183 |
Revenue and Deferred Revenue _2
Revenue and Deferred Revenue - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
Deferred revenue, revenue recognized | $ 92.9 | $ 88.6 |
Revenue and Deferred Revenue _3
Revenue and Deferred Revenue - Additional Information (Details 1) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-04-01 $ in Millions | Mar. 31, 2023 USD ($) |
Disaggregation Of Revenue [Line Items] | |
Revenue, unsatisfied performance obligation | $ 245.5 |
Performance obligation, expected timing of satisfaction, period | 12 months |
Geographical Information - Sche
Geographical Information - Schedule of Percentage of Revenue by Geographic Area (Details) - Geographic Concentration Risk - Revenue | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
United States | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Percentage of revenue by geographic area | 66% | 64% |
Rest of World | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Percentage of revenue by geographic area | 34% | 36% |
Cash and Cash Equivalents - Sum
Cash and Cash Equivalents - Summary of Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 199,080 | $ 202,816 | ||
Restricted cash included in prepaid expenses and other current assets | $ 573 | $ 442 | ||
Restricted Cash, Current, Asset, Statement of Financial Position [Extensible List] | Prepaid expenses and other current assets | Prepaid expenses and other current assets | ||
Total cash, cash equivalents and restricted cash | $ 199,653 | $ 203,258 | $ 238,955 | $ 306,121 |
Cash and Cash Equivalents - Add
Cash and Cash Equivalents - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Cash and Cash Equivalents [Abstract] | ||
Cash in transit for credit and debit card transactions | $ 2.2 | $ 1.1 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value Disclosures [Abstract] | ||
Fair value of debt | $ 181.9 | $ 180.1 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Property Plant And Equipment [Line Items] | ||
Gross property and equipment | $ 59,629 | $ 60,767 |
Less: Accumulated depreciation | (58,999) | (59,761) |
Property and equipment, net | 630 | 1,006 |
Computer Equipment | ||
Property Plant And Equipment [Line Items] | ||
Gross property and equipment | 7,422 | 7,492 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Gross property and equipment | 44,623 | 45,710 |
Furniture, Fixtures, and Other Assets | ||
Property Plant And Equipment [Line Items] | ||
Gross property and equipment | $ 7,584 | $ 7,565 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 0.4 | $ 1.4 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Schedule of Intangible Assets, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Finite Lived Intangible Assets [Line Items] | ||
Acquisition intangible assets, Net, Gross carrying amount | $ 11,000 | $ 11,000 |
Acquisition intangible assets, Net, Accumulated amortization | (6,215) | (5,844) |
Acquisition intangible assets, Net carrying amount | 4,785 | 5,156 |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquisition intangible assets, Net, Gross carrying amount | 10,100 | 10,100 |
Acquisition intangible assets, Net, Accumulated amortization | (5,315) | (4,944) |
Acquisition intangible assets, Net carrying amount | 4,785 | 5,156 |
Trade Name | ||
Finite Lived Intangible Assets [Line Items] | ||
Acquisition intangible assets, Net, Gross carrying amount | 900 | 900 |
Acquisition intangible assets, Net, Accumulated amortization | (900) | (900) |
Acquisition intangible assets, Net carrying amount | $ 0 | $ 0 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Intangible Assets And Goodwill [Line Items] | |||
Amortization of intangible assets | $ 371 | $ 2,911 | |
Amortization expense related to capitalized internal-use software | 2,100 | $ 2,800 | |
Removal of fully amortized capitalized internal-use software | 19,600 | ||
Capitalized internal-use software, net | 29,942 | $ 29,595 | |
Capitalized Internal-Use Software Net in Development Phase | |||
Intangible Assets And Goodwill [Line Items] | |||
Capitalized internal-use software, net | $ 16,200 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Schedule of Carrying Amount of Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Beginning balance | $ 459,817 |
Foreign currency translation | 1,162 |
Ending Balance | $ 460,979 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill - Schedule of Capitalized Internal-Use Software (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Capitalized Computer Software, Net [Abstract] | ||
Gross capitalized internal-use software | $ 45,078 | $ 62,249 |
Less: Accumulated amortization | (15,136) | (32,654) |
Capitalized internal-use software, net | $ 29,942 | $ 29,595 |
Intangible Assets and Goodwil_6
Intangible Assets and Goodwill - Summary of Future Amortization Expense (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Capitalized Internal-Use Software, Net | |
Finite Lived Intangible Assets [Line Items] | |
Remainder of 2023 | $ 5,085 |
2024 | 4,964 |
2025 | 3,458 |
2026 | 279 |
Finite-Lived Intangible Assets Amortization Expense, Total | 13,786 |
Acquisition Intangible Assets, Net | |
Finite Lived Intangible Assets [Line Items] | |
Remainder of 2023 | 1,113 |
2024 | 1,483 |
2025 | 1,389 |
2026 | 800 |
Finite-Lived Intangible Assets Amortization Expense, Total | $ 4,785 |
Stockholder's Equity and Empl_3
Stockholder's Equity and Employee Benefit Plans - Additional Information (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) Offering_period shares | Mar. 31, 2022 USD ($) shares | Feb. 26, 2022 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock Repurchased During Period, Shares | shares | 0 | ||
Payments for repurchase of common stock | $ | $ 0 | $ 36,376 | |
Stock repurchase authorization amount | $ | $ 116,500 | ||
2018 Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Offering period | 24 months | ||
Number of offering periods | Offering_period | 4 | ||
Length of purchase period | 6 months | ||
Employee share purchase price percentage | 85% | ||
Time-Based Awards | Equity Incentive Plans | New Hires | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Time-Based Awards | Equity Incentive Plans | Existing Employees | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Maximum | Equity Incentive Plans | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expiration period | 10 years | ||
Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Authorized repurchase amount, stock repurchase program | $ | $ 200,000 | ||
Stock Repurchased During Period, Shares | shares | 2,411,000 | ||
Payments for repurchase of common stock | $ | $ 36,400 | ||
Common Stock | 2018 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant | shares | 28,741,857 | ||
Common Stock | 2018 Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for issuance | shares | 7,481,519 |
Stockholder's Equity and Empl_4
Stockholder's Equity and Employee Benefit Plans - Summary of Restricted Stock Units (Details) - Restricted Stock Units - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Number of Shares | ||
Unvested at December 31, 2022 | 8,023,173 | |
Granted | 563,320 | |
Vested | (979,131) | |
Forfeited/cancelled | (896,761) | |
Unvested at March 31, 2023 | 6,710,601 | 8,023,173 |
Unvested at December 31, 2022 | $ 15.07 | |
Granted | 8.24 | |
Vested | 17.52 | |
Forfeited/cancelled | 14.56 | |
Unvested at March 31, 2023 | $ 14.21 | $ 15.07 |
Unvested, Weighted Average Remaining Contractual Term | 1 year 2 months 12 days | 1 year 2 months 12 days |
Stockholder's Equity and Empl_5
Stockholder's Equity and Employee Benefit Plans - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Number of Shares | ||
Outstanding at December 31, 2022 | 13,133,446 | |
Granted | 0 | |
Exercised | 0 | |
Forfeited | (22,001) | |
Expired | (2,325,356) | |
Outstanding, vested and expected to vest at March 31, 2023 | 10,786,089 | 13,133,446 |
Vested and exercisable at March 31, 2023 | 8,770,544 | |
Weighted Average Exercise Price | ||
Outstanding at December 31, 2022 | $ 16.24 | |
Granted | 0 | |
Exercised | 0 | |
Forfeited | 20.18 | |
Expired | 16.61 | |
Outstanding, vested and expected to vest at March 31, 2023 | 16.15 | $ 16.24 |
Vested and exercisable at March 31, 2023 | $ 16.59 | |
Outstanding at December 31, 2022 | $ 0 | |
Outstanding, vested and expected to vest, Aggregate Intrinsic Value, at March 31, 2023 | 1,918 | $ 0 |
Vested and exercisable at March 31, 2023 | $ 0 | |
Outstanding, vested and expected to vest, Weighted Average Remaining Contractual Term | 4 years 8 months 12 days | 4 years 2 months 12 days |
Vested and exercisable, Weighted Average Remaining Contractual Term | 4 years 8 months 12 days |
Stockholder's Equity and Empl_6
Stockholder's Equity and Employee Benefit Plans - Summary of Restricted Stock Awards (Details) - Restricted Stock Awards - $ / shares | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Number of Shares | ||
Unvested at December 31, 2022 | 890,219 | |
Granted | 0 | |
Vested | (80,905) | |
Forfeited/cancelled | 0 | |
Unvested at March 31, 2023 | 809,314 | 890,219 |
Weighted Average Grant-Date Fair Value | ||
Unvested at December 31, 2022 | $ 17.43 | |
Granted | 0 | |
Vested | 17.38 | |
Forfeited/cancelled | 0 | |
Unvested at March 31, 2023 | $ 17.43 | $ 17.43 |
Weighted Average Remaining Contractual Term (in years) | ||
Unvested, Weighted Average Remaining Contractual Term | 1 year 9 months 18 days | 1 year 10 months 24 days |
Stockholder's Equity and Empl_7
Stockholder's Equity and Employee Benefit Plans - Summary of Stock-based Compensation Expense Recognized in Financial Statements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense, net of amounts capitalized | $ 20,402 | $ 26,254 |
Capitalized stock-based compensation expense | 506 | 719 |
Stock-based compensation expense | 20,908 | 26,973 |
Cost of revenue | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense, net of amounts capitalized | 1,241 | 1,409 |
Research and development | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense, net of amounts capitalized | 7,734 | 8,644 |
Sales and marketing | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense, net of amounts capitalized | 4,075 | 6,065 |
General and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense, net of amounts capitalized | 7,352 | 7,375 |
Restructuring expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense, net of amounts capitalized | $ 0 | $ 2,761 |
Stockholder's Equity and Empl_8
Stockholder's Equity and Employee Benefit Plans - Unamortized Stock-based Compensation (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation (in thousands) | $ 112,375 |
Restricted Stock Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation (in thousands) | $ 86,935 |
Weighted average recognition period (in years) | 2 years |
Stock Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation (in thousands) | $ 6,052 |
Weighted average recognition period (in years) | 1 year |
Restricted Stock Awards | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation (in thousands) | $ 8,407 |
Weighted average recognition period (in years) | 1 year 9 months 18 days |
ESPP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation (in thousands) | $ 10,981 |
Weighted average recognition period (in years) | 1 year 7 months 6 days |
Stockholder's Equity and Empl_9
Stockholder's Equity and Employee Benefit Plans - 401(k) Plan - Additional Information (Details) - United States - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Defined Contribution Plan Disclosure [Line Items] | ||
Matching contribution of deferrals for eligible employees | 25% | |
Matching contribution compensation expense | $ 1.7 | $ 1.9 |
Leases - Additional Information
Leases - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Leases [Abstract] | ||
Operating lease expiration year | 2028 | |
Operating lease, Weighted average remaining operating lease term | 5 years 6 months | 5 years 8 months 12 days |
Operating lease, weighted average discount rate, percent | 7.10% | 7.10% |
Leases - Schedule of Operating
Leases - Schedule of Operating Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases [Abstract] | ||
Operating lease cost (gross lease expense) | $ 2,273 | $ 3,204 |
Variable lease costs | 958 | 1,330 |
Sublease income (including reimbursed expenses) | $ 491 | $ 846 |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Operating Lease Liabilities and Sublease Income (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Operating Leases Payments | |
Remainder of 2023 | $ 8,400 |
2024 | 9,753 |
2025 | 9,307 |
2026 | 9,516 |
2027 | 9,788 |
Thereafter | 9,363 |
Gross lease payments (income) | 56,127 |
Less: Imputed interest | 9,802 |
Less: Tenant improvement receivables | 418 |
Total operating lease liabilities | 45,907 |
Sublease Income | |
Remainder of 2023 | (1,318) |
2024 | (372) |
2025 | 0 |
2026 | 0 |
2027 | 0 |
Thereafter | 0 |
Gross lease payments (income) | $ (1,690) |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Non-Cancelable Purchase Commitments (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | |
Remainder of 2023 | $ 12,531 |
2024 | 8,082 |
2025 | 1,946 |
2026 | 49 |
2027 | 1 |
Total purchase commitments | $ 22,609 |
Commitments and Contingencies_2
Commitments and Contingencies - Additional Information (Details) $ in Millions | Mar. 31, 2023 USD ($) |
San Mateo Facility | |
Other Commitments [Line Items] | |
Standby letter of credit issued | $ 1 |
Debt - Schedule of Carrying Val
Debt - Schedule of Carrying Values of Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | ||
Total debt | $ 185,100 | |
Less: Unamortized issuance discount and issuance costs, net | 759 | $ 834 |
Debt, current | 1,900 | 1,900 |
Debt, non-current | $ 182,441 | 182,916 |
2018 Credit Facility | ||
Debt Instrument [Line Items] | ||
Issuance date | Oct. 31, 2018 | |
Maturity date | Oct. 10, 2025 | |
Total debt | $ 185,100 | $ 185,650 |
2018 Credit Facility | Minimum | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 8.10% | 3.90% |
2018 Credit Facility | Maximum | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 8.70% | 8.10% |
Debt - Additional Information (
Debt - Additional Information (Details) - 2018 Credit Facility - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Oct. 31, 2018 | |
Debt Instrument [Line Items] | ||
Debt instrument, due date | Oct. 10, 2025 | |
Line of credit facility, remaining borrowing capacity | $ 74,000,000 | |
Term Loan | ||
Debt Instrument [Line Items] | ||
Debt instrument, face amount | $ 220,000,000 | |
Debt instrument, quarterly principal payments | $ 550,000 | |
Debt instrument, due date | Oct. 10, 2025 | |
Domestic Line of Credit | ||
Debt Instrument [Line Items] | ||
Credit facility, maximum borrowing capacity | $ 75,000,000 | |
Debt instrument, due date | Oct. 10, 2023 | |
Alternate Base Rate | Term Loan | ||
Debt Instrument [Line Items] | ||
Applicable margin | 2.75% | |
Alternate Base Rate | Domestic Line of Credit | Minimum | ||
Debt Instrument [Line Items] | ||
Applicable margin | 0.75% | |
Alternate Base Rate | Domestic Line of Credit | Maximum | ||
Debt Instrument [Line Items] | ||
Applicable margin | 1.50% | |
Term Benchmark Rate | Term Loan | ||
Debt Instrument [Line Items] | ||
Applicable margin | 3.75% | |
Term Benchmark Rate | Domestic Line of Credit | Minimum | ||
Debt Instrument [Line Items] | ||
Applicable margin | 1.75% | |
Term Benchmark Rate | Domestic Line of Credit | Maximum | ||
Debt Instrument [Line Items] | ||
Applicable margin | 2.50% |
Debt - Schedule of Future Minim
Debt - Schedule of Future Minimum Payment Obligations of Principal Amounts Due (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2023 | $ 1,650 |
2024 | 2,200 |
2025 | 181,250 |
Total principal outstanding | $ 185,100 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Income tax provision | $ 451 | $ 216 |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator: | ||
Net loss | $ (23,815) | $ (37,377) |
Denominator: | ||
Weighted average number of basic shares outstanding | 149,345 | 150,262 |
Weighted average number of diluted shares outstanding | 149,345 | 150,262 |
Net loss per common share, basic | $ (0.16) | $ (0.25) |
Net loss per common share, diluted | $ (0.16) | $ (0.25) |
Net Loss Per Share - Additional
Net Loss Per Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of net loss per share | 20.2 | 26.3 |
Restructuring Costs - Additiona
Restructuring Costs - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||
Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2022 | Feb. 15, 2023 | Oct. 10, 2022 | ||
Restructuring Cost [Line Items] | |||||||
Restructuring | [1],[2] | $ 7,197 | $ 4,883 | ||||
Restructuring reserve, current | 2,000 | ||||||
February 2023 Restructuring Plan | |||||||
Restructuring Cost [Line Items] | |||||||
Restructuring | $ 7,200 | ||||||
Reduction of the company's workforce | 14% | ||||||
October 2022 Restructuring Plan | |||||||
Restructuring Cost [Line Items] | |||||||
Restructuring | $ 4,200 | ||||||
Reduction of the company's workforce | 11% | ||||||
March 2022 Restructuring Plan | |||||||
Restructuring Cost [Line Items] | |||||||
Restructuring | $ 2,400 | ||||||
[1] (1) Includes stock-based compensation, net of amounts capitalized as follows: (2) Includes amortization of acquisition intangible assets as follows: |
Restructuring Costs - Pre -Tax
Restructuring Costs - Pre -Tax Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | ||
Restructuring Cost and Reserve [Line Items] | |||
Employee severance | $ 7,197 | $ 822 | |
Stock-based compensation | 0 | 2,761 | |
Amortization of intangible assets | 371 | 2,911 | |
Restructuring Costs, Total | [1],[2] | 7,197 | 4,883 |
Restructuring expense | |||
Restructuring Cost and Reserve [Line Items] | |||
Amortization of intangible assets | 0 | 45 | |
Contract termination | |||
Restructuring Cost and Reserve [Line Items] | |||
Contract termination and other costs | $ 0 | $ 1,255 | |
[1] (1) Includes stock-based compensation, net of amounts capitalized as follows: (2) Includes amortization of acquisition intangible assets as follows: |