Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 02, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-40349 | |
Entity Registrant Name | DoubleVerify Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-2714562 | |
Entity Address, Address Line One | 233 Spring Street | |
Entity Address, City or Town | New York | |
Entity Address State Or Province | NY | |
Entity Address, Postal Zip Code | 10013 | |
City Area Code | 212 | |
Local Phone Number | 631-2111 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | DV | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 163,503,295 | |
Entity Central Index Key | 0001819928 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 211,600 | $ 221,591 |
Trade receivables, net of allowances for doubtful accounts of $7,315 and $6,527 as of March 31, 2022 and December 31, 2021, respectively | 134,030 | 122,938 |
Prepaid expenses and other current assets | 24,979 | 23,295 |
Total current assets | 370,609 | 367,824 |
Property, plant and equipment, net | 19,152 | 17,575 |
Operating lease right-of-use assets, net | 76,825 | |
Goodwill | 342,666 | 350,560 |
Intangible assets, net | 154,512 | 153,395 |
Deferred tax assets | 60 | 60 |
Other non-current assets | 1,859 | 2,780 |
Total assets | 965,683 | 892,194 |
Current liabilities | ||
Trade payables | 3,821 | 3,853 |
Accrued expense | 26,190 | 41,456 |
Operating lease liabilities, current | 4,909 | |
Income tax liabilities | 996 | 1,321 |
Current portion of finance lease obligations | 2,027 | 1,970 |
Contingent considerations, current | 1,717 | |
Other current liabilities | 6,745 | 6,716 |
Total current liabilities | 44,688 | 57,033 |
Operating lease liabilities, non-current | 74,334 | |
Finance lease obligations | 2,043 | 2,579 |
Deferred tax liabilities | 28,291 | 30,307 |
Other non-current liabilities | 2,638 | 3,209 |
Total liabilities | 151,994 | 93,128 |
Commitments and contingencies (Note 13) | ||
Stockholders' equity | ||
Common stock, $0.001 par value, 1,000,000 shares authorized, 163,118 shares issued and 163,027 outstanding as of March 31, 2022; 1,000,000 shares authorized, 162,347 shares issued and 162,297 shares outstanding as of December 31, 2021 | 163 | 162 |
Additional paid-in capital | 729,899 | 717,228 |
Treasury stock, at cost, 91 shares and 50 shares as of March 31, 2022 and December 31, 2021, respectively | (2,860) | (1,802) |
Retained earnings | 88,828 | 84,249 |
Accumulated other comprehensive loss, net of income taxes | (2,341) | (771) |
Total stockholders' equity | 813,689 | 799,066 |
Total liabilities and stockholders' equity | $ 965,683 | $ 892,194 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Trade Receivables, net of allowances | $ 7,315 | $ 6,527 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,000,000 | 1,000,000 |
Common stock, shares issued | 163,118 | 162,347 |
Common stock, shares outstanding | 163,027 | 162,297 |
Treasury stock, shares | 91 | 50 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME | ||
Revenue | $ 96,723 | $ 67,586 |
Cost of revenue (exclusive of depreciation and amortization shown separately below) | 16,877 | 10,203 |
Product development | 21,588 | 14,179 |
Sales, marketing and customer support | 26,684 | 15,534 |
General and administrative | 19,675 | 11,835 |
Depreciation and amortization | 9,040 | 7,057 |
Income from operations | 2,859 | 8,778 |
Interest expense | 232 | 390 |
Other expense (income), net | 46 | (49) |
Income before income taxes | 2,581 | 8,437 |
Income tax (benefit) expense | (1,998) | 2,793 |
Net income | $ 4,579 | $ 5,644 |
Earnings per share: | ||
Basic | $ 0.03 | $ 0.05 |
Diluted | $ 0.03 | $ 0.04 |
Weighted-average common stock outstanding: | ||
Basic | 162,612 | 125,112 |
Diluted | 170,439 | 133,578 |
Comprehensive income: | ||
Net income | $ 4,579 | $ 5,644 |
Other comprehensive income: | ||
Foreign currency cumulative translation adjustment | (1,570) | (799) |
Total comprehensive income | $ 3,009 | $ 4,845 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Preferred Stock | Treasury Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive (Loss) Income Net of Income Taxes | Total |
Balance at Dec. 31, 2020 | $ 140 | $ 610 | $ (260,686) | $ 620,679 | $ 54,941 | $ 1,011 | $ 416,695 |
Balance (in shares) at Dec. 31, 2020 | 140,222 | 61,006 | 15,146 | ||||
Foreign currency translation adjustment | (799) | (799) | |||||
Stock-based compensation expense | 2,538 | 2,538 | |||||
Common stock issued upon exercise of stock options | 538 | 538 | |||||
Common stock issued upon exercise of stock options (in shares) | 180 | ||||||
Net income | 5,644 | 5,644 | |||||
Balance at Mar. 31, 2021 | $ 140 | $ 610 | $ (260,686) | 623,755 | 60,585 | 212 | 424,616 |
Balance (in shares) at Mar. 31, 2021 | 140,402 | 61,006 | 15,146 | ||||
Balance at Dec. 31, 2021 | $ 162 | $ (1,802) | 717,228 | 84,249 | (771) | 799,066 | |
Balance (in shares) at Dec. 31, 2021 | 162,347 | 50 | |||||
Foreign currency translation adjustment | (1,570) | (1,570) | |||||
Shares repurchased for settlement of employee tax withholdings | $ (1,058) | (1,058) | |||||
Shares repurchased for settlement of employee tax withholdings (in shares) | 41 | ||||||
Stock-based compensation expense | 10,994 | 10,994 | |||||
Common stock issued to non-employees (in shares) | 4 | ||||||
Common stock issued upon exercise of stock options | $ 1 | 1,677 | $ 1,678 | ||||
Common stock issued upon exercise of stock options (in shares) | 572 | 574 | |||||
Common stock issued upon vesting of restricted stock units (in shares) | 195 | ||||||
Net income | 4,579 | $ 4,579 | |||||
Balance at Mar. 31, 2022 | $ 163 | $ (2,860) | $ 729,899 | $ 88,828 | $ (2,341) | $ 813,689 | |
Balance (in shares) at Mar. 31, 2022 | 163,118 | 91 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating activities: | ||
Net income | $ 4,579 | $ 5,644 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Bad debt expense (recovery) | 1,079 | (390) |
Depreciation and amortization expense | 9,040 | 7,057 |
Amortization of debt issuance costs | 74 | 74 |
Non-cash lease expense | 2,002 | |
Deferred taxes | (2,016) | (1,328) |
Stock-based compensation expense | 10,994 | 2,538 |
Interest (income) expense | (14) | 66 |
Loss on disposal of fixed assets | 471 | |
Offering costs | 3,073 | |
Other | (150) | (68) |
Changes in operating assets and liabilities net of effect of business combinations | ||
Trade receivables | (12,224) | 7,803 |
Prepaid expenses and other assets | (2,332) | 1,742 |
Trade payables | 2 | (524) |
Accrued expenses and other liabilities | (13,754) | (6,223) |
Net cash (used in) provided by operating activities | (2,249) | 19,464 |
Investing activities: | ||
Purchase of property, plant and equipment | (4,759) | (1,915) |
Net cash (used in) investing activities | (4,759) | (1,915) |
Financing activities: | ||
Payment of contingent consideration related to Zentrick acquisition | (3,247) | |
Proceeds from common stock issued upon exercise of stock options | 1,678 | 538 |
Payments related to offering costs | (6) | (1,181) |
Finance lease payments | (480) | (235) |
Shares repurchased for settlement of employee tax withholdings | (1,058) | |
Net cash (used in) financing activities | (3,113) | (878) |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | 131 | (209) |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (9,990) | 16,462 |
Cash, cash equivalents, and restricted cash - Beginning of period | 221,725 | 33,395 |
Cash, cash equivalents, and restricted cash - End of period | 211,735 | 49,857 |
Supplemental cash flow information: | ||
Cash paid for taxes | 948 | 1,045 |
Cash paid for interest | 244 | 147 |
Non-cash investing and financing activities: | ||
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 79,563 | |
Acquisition of equipment under finance lease | 1,518 | |
Offering costs included in accounts payable and accrued expense | $ 1,889 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - Reconciliation of Cashflows - USD ($) $ in Thousands | Mar. 31, 2022 | Mar. 31, 2021 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
Cash and cash equivalents | $ 211,600 | $ 49,815 |
Restricted cash (included in prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets) | 135 | 42 |
Total cash and cash equivalents and restricted cash | $ 211,735 | $ 49,857 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2022 | |
Description of Business | |
Description of Business | 1. Description of Business DoubleVerify Holdings, Inc. (the “Company”) is a leading software platform for digital media measurement and analytics. Our mission is to create stronger, safer, more secure digital transactions that drive optimal outcomes for global advertisers. Through our software platform and the metrics it provides, we help preserve the fair value exchange between buyers and sellers of digital media. The Company’s solutions provide advertisers unbiased data analytics that enable advertisers to increase the effectiveness, quality and return on their digital advertising investments. The DV Authentic Ad is our proprietary metric of digital media quality, which measures whether a digital ad was delivered in a brand suitable environment, fully viewable, by a real person and in the intended geography. The Company’s software interface, DV Pinnacle, delivers these metrics to our customers in real time, allowing them to access critical performance data on their digital transactions. The Company’s software solutions are integrated across the entire digital advertising ecosystem, including programmatic platforms, social media channels and digital publishers. The Company’s solutions are accredited by the Media Rating Council, which allows the Company’s data to be used as a single source standard in the evaluation and measurement of digital ads. The Company was incorporated on August 16, 2017, is registered in the state of Delaware and is the parent company of DoubleVerify Midco, Inc. (“MidCo”), which is in turn the parent company of DoubleVerify Inc. On August 18, 2017, DoubleVerify Inc. entered into an agreement and plan of merger (the “Agreement”), whereby the Company and Pixel Merger Sub, Inc. (“Merger Sub”), a wholly-owned subsidiary of the Company, agreed to provide for the merger of the Merger Sub with DoubleVerify Inc. pursuant to the terms and conditions of the Agreement. On the effective date, Merger Sub was merged with and into DoubleVerify Inc. whereupon the separate corporate existence of Merger Sub ceased and DoubleVerify Inc. continued as the surviving corporation. Through the merger, the Company acquired 100% of the outstanding equity instruments of DoubleVerify Inc., (the “Acquisition”) resulting in a change of control at the parent level. The merger resulted in the application of acquisition accounting under the provisions of Financial Accounting Standards Board (“FASB”) Topic Accounting Standards Codification (“ASC”) 805 , “Business Combinations.” The Company is headquartered in New York, New York and has wholly-owned subsidiaries in numerous jurisdictions including Israel, the United Kingdom, Germany, Singapore, Australia, Canada, Brazil, Belgium, Mexico, France, Japan, Spain, and Finland, and operates in one reportable segment. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2022 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of Presentation and Summary of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Preparation and Principles of Consolidation The accompanying Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021, the Condensed Consolidated Statements of Operations and Comprehensive Income for the three months ended March 31, 2022 and 2021, the Condensed Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2022 and 2021, and the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 reflect all adjustments that are of a normal recurring nature and that are considered necessary for a fair presentation of the results for the periods shown in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules and regulations of the SEC for interim financial reporting periods. Accordingly, certain information and footnote disclosures have been condensed or omitted pursuant to SEC rules that would ordinarily be required under GAAP for complete financial statements. These unaudited interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in its Annual Report on Form 10-K for the year ended December 31, 2021. In the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021, the Company changed the presentation in describing the changes in operating assets and liabilities by combining the lines for Accrued expenses, Other current liabilities, and Other non-current liabilities into a single line item. The Company further combined Prepaid expenses and other current assets and Other non-current assets into a single line item. Both the original and new presentations are in accordance with the applicable financial reporting framework and the change was applied retrospectively solely to enhance the comparability with the current Condensed Consolidated Statements of Cash Flows. Use of Estimates and Judgments in the Preparation of the Condensed Consolidated Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expense during the reporting periods. Significant estimates and judgments are inherent in the analysis and measurement of items including, but not limited to: revenue recognition criteria including the determination of principal versus agent revenue considerations, income taxes, the valuation and recoverability of goodwill and intangible assets, the assessment of potential loss from contingencies, assumptions in valuing acquired assets and liabilities assumed in business combinations, the allowance for doubtful accounts, and assumptions used in determining the fair value of stock-based compensation. Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in those estimates. These estimates are based on the information available as of the date of the Condensed Consolidated Financial Statements . Recently Adopted Accounting Pronouncements Leases In February 2016, the FASB issued ASU No. 2016-02, Leases In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases Leases: Targeted Improvements The amendments in ASU No. 2016-02, ASU No. 2018-10 and ASU No. 2018-11 are effective for fiscal years beginning after December 15, 2021, for non-public entities and interim periods within fiscal years beginning after December 15, 2022, and allow for modified retrospective adoption with early adoption permitted. The Company adopted the amendments on January 1, 2022 using the modified retrospective approach and elected the transition relief package of practical expedients by applying previous accounting conclusions under ASC 840 to all leases that existed prior to the transition date. There was no impact to retained earnings upon the adoption of ASC 842. As a result of the adoption, the Company did not reassess 1) whether existing or expired contracts contain leases, 2) lease classification for any existing or expired leases, and 3) whether lease origination costs qualified as initial direct costs. The Company did not elect the practical expedient to use hindsight in determining a lease term and impairment of the ROU assets at the adoption date. Additionally, the Company did not separate lease components from non-lease components for the specified asset classes. Furthermore, the Company did not apply the recognition requirements under ASC 842 to short-term leases, generally defined as a lease term of less than one year. The Company has operating and financing leases for corporate offices, data centers, and certain equipment. The leases have remaining lease terms ranging from less than The Company determines if an arrangement is a lease at inception and does not recognize a lease with a term shorter than 12 months. An ROU asset represents the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease ROU assets and lease liabilities are to be recognized at commencement date based on the present value of lease payments not yet paid over the lease term. As the Company’s operating leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available on the adoption date in determining the present value of lease payments not yet paid. The incremental borrowing rate for United States dollar denominated leases was calculated by considering current market yields and the Company’s existing debt rates to determine a yield. In order to assess a premium or discount for the lease tenor and develop an incremental borrowing rate curve, the analysis compared the Company’s existing debt yield to the appropriate market yield curve corresponding to the Company’s secured rating. The curve one notch higher was used as the incremental borrowing rate focuses on secured borrowing rates, which tend to carry higher credit ratings when issued. The corporate yield curve was adjusted based on the Company’s implied incremental borrowing rate premium or discount at each tenor to reach a concluded incremental borrowing rate curve. Using the calculated United States dollar incremental borrowing rate, the international incremental borrowing rates were determined by adjusting for specific country risk. The operating lease ROU assets include any lease payments made prior to the rent commencement date and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Operating lease transactions are included in Operating lease right-of-use assets, net, and Operating lease liabilities, current and noncurrent, within the accompanying Condensed Consolidated Balance Sheets. Finance leases, formerly known as (“f/k/a”) Capital leases, are included in Property, plant and equipment, net, Current portion of finance lease obligations, and Finance lease obligations within the accompanying Condensed Consolidated Balance Sheets. Refer to Note 7, Leases, for further information. Recently Issued Accounting Pronouncements The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act (“JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with certain new or revised accounting standards. Financial Instruments - Credit Losses In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (Topic 740) |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2022 | |
Revenue | |
Revenue | 3. Revenue The following table disaggregates revenue between advertiser customers, where revenue is generated based on number of ads measured for Measurement (f/k/a Advertiser – direct) or measured and purchased for Activation (f/k/a Advertiser – programmatic) and supply-side customers, where revenue is generated based on contracts with minimum guarantees or contracts that contain overages after minimum guarantees are achieved. Disaggregated revenue by customer type is as follows: Three Months Ended March 31, ( in thousands) 2022 2021 Measurement (f/k/a Advertiser - direct) $ 33,834 $ 27,541 Activation (f/k/a Advertiser - programmatic) 53,031 33,912 Supply-side customer 9,858 6,133 Total revenue $ 96,723 $ 67,586 Contract assets relate to the Company’s conditional right to consideration for completed performance under the contract (e.g., unbilled receivables). Trade receivables, net of allowance for doubtful accounts, include unbilled receivable balances of $39.7 million and $55.7 million as of March 31, 2022 and December 31, 2021, respectively. |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2022 | |
Business Combinations | |
Business Combinations | 4. OpenSlate On November 22, 2021, the Company acquired all of the outstanding stock of Outrigger Media, Inc. (d/b/a “OpenSlate”), a leading independent pre-campaign contextual targeting platform for social video and CTV for a total purchase price of $148.2 million, net of cash acquired, which includes working capital adjustments of $0.8 million recorded during the three months ended March 31, 2022. The Company prepared an initial determination of the fair value of the assets acquired and liabilities assumed as of the acquisition date using preliminary information. During the three months ended March 31, 2022, the Company has recognized measurement period adjustments to the purchase consideration and the allocation of the fair value of certain assets and liabilities assumed as a result of further refinements in the Company’s estimates. The effect of these adjustments on the preliminary purchase price allocation was an increase to Intangible assets, net of $7.7 million, an increase to the purchase consideration of $0.8 million resulting from working capital adjustments, and an increase to Accrued expense of less than $0.1 million. The corresponding impact was recorded to Goodwill on the Condensed Consolidated Balance Sheets. The impact to the Condensed Consolidated Statements of Operations and Comprehensive Income as result of these adjustments recognized during the reporting period were immaterial. The acquired intangible assets of OpenSlate are amortized over their estimated useful lives. Based on facts and circumstances in existence as of the effective date of the acquisition, the useful life of developed technology and customer relationships intangible assets acquired were determined to be five The Company incurred acquisition-related transaction costs of $0.2 million included in General and administrative expenses in the Condensed Consolidated Statement of Operations and Comprehensive Income for the three months ended March 31, 2022. The preliminary allocations of the purchase price for the 2021 acquisitions (OpenSlate and Meetrics GmbH) and purchase of controlling interest within less than a year of ownership are subject to revisions as additional information is obtained about the facts and circumstances that existed as of each acquisition date. The revisions may have a significant impact on our condensed consolidated financial statements. The allocations of the purchase price will be finalized once all the information that was known and knowable as of the acquisition date is obtained and analyzed, not to exceed one year from the acquisition date. The primary areas of the purchase price allocation that are not yet finalized relate to certain direct and indirect taxes and the finalization of working capital adjustments. Zentrick NV On February 15, 2019, the Company acquired all of the outstanding stock of Zentrick NV (“Zentrick”). Zentrick, headquartered in Ghent, Belgium is a digital video technology company that provides middleware solutions that increase the performance of online video advertising for brand advertisers, advertising platforms and publishers. This acquisition integrated technology into the Company’s suite of products related to advertising viewability specifically on video formats, a growing segment of the advertising market and critical for the delivery of verification services to social platforms and CTV. The aggregate purchase price consisted of 1) $23.2 million paid in cash at closing, which excluded closing adjustments of approximately $0.2 million paid in April 2019 2) $0.1 million in holdback payment of which 50% was payable 12 months after the closing date, and the remaining 50% was payable 24 months after the closing date and 3) up to $17.3 million of performance-based deferred payments that comprised two components (the “Zentrick Deferred Payment Terms”). The first component had a $4.0 million maximum payment related to four milestone tranches of $1.0 million each based on achievement of certain product milestones (“technical milestones”). The second component had a total maximum payment of $13.0 million and varied based upon certain revenue targets in fiscal 2019, 2020, and 2021 (“revenue targets”). With respect to payments due related to the Zentrick acquisition, the Company and the Zentrick selling stockholders reached an agreement on February 14, 2022 (the “Zentrick Early Termination Agreement”), for the early termination of the Zentrick Deferred Payment Terms and resolution of the contingent payments due for both the technical milestones and revenue targets. Pursuant to the terms of the Zentrick Early Termination Agreement, the Company made a payment of $5.6 million on February 16, 2022 to the Zentrick selling stockholders to settle the remaining liability. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | 5. The following is a summary of changes to the goodwill carrying value from December 31, 2021 to March 31, 2022: (in thousands) Goodwill at December 31, 2021 $ 350,560 Measurement period adjustments (6,915) Foreign exchange impact (979) Goodwill at March 31, 2022 $ 342,666 The following table summarizes the Company’s intangible assets and related accumulated amortization: ( in thousands) March 31, 2022 December 31, 2021 Gross Carrying Accumulated Net Carrying Gross Carrying Accumulated Net Carrying Amount Amortization Amount Amount Amortization Amount Trademarks and brands $ 11,734 $ (3,644) $ 8,090 $ 11,735 $ (3,422) $ 8,313 Customer relationships 146,093 (40,044) 106,049 143,728 (36,831) 106,897 Developed technology 77,071 (36,746) 40,325 72,065 (33,937) 38,128 Non-compete agreements 67 (19) 48 68 (11) 57 Total intangible assets $ 234,965 $ (80,453) $ 154,512 $ 227,596 $ (74,201) $ 153,395 Amortization expense for the three months ended March 31, 2022 and March 31, 2021 is $6.3 million and $4.5 million, respectively. Estimated future expected amortization expense of intangible assets as of March 31, 2022 is as follows: (in thousands) 2022 (for remaining nine months) $ 18,725 2023 24,901 2024 23,341 2025 21,199 2026 16,094 2027 13,884 Thereafter 36,368 Total $ 154,512 The weighted-average remaining useful life by major asset classes as of March 31, 2021 is as follows: (In years) Trademarks and brands 10 Customer relationships 8 Developed technology 4 Non-compete agreements 1 There were no impairments identified during the three months ended March 31, 2022 or March 31, 2021. |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment | |
Property, Plant and Equipment | 6. Property, plant and equipment, including equipment under finance lease obligations and capitalized software development costs, consists of the following: As of (in thousands) March 31, 2022 December 31, 2021 Computers and peripheral equipment $ 18,948 $ 18,883 Office furniture and equipment 494 1,102 Leasehold improvements 8,428 9,354 Capitalized software development costs 16,593 15,007 Less accumulated depreciation and amortization (25,311) (26,771) Total property, plant and equipment, net $ 19,152 $ 17,575 For the three months ended March 31, 2022 and March 31, 2021, total depreciation expense was $2.7 million and $2.6 million, respectively. Property and equipment under finance lease obligations, consisting of computer equipment, totaled $12.3 million and $12.3 million on March 31, 2022 and December 31, 2021, respectively. As of March 31, 2022 and December 31, 2021, accumulated depreciation related to property and equipment under finance lease obligations totaled $10.3 million and $10.0 million, respectively. Refer to Note 7, Leases. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2022 | |
Leases | |
Leases | 7. Leases The following table presents the cumulative effect of the changes made to the Condensed Consolidated Balance Sheet as of January 1, 2022 as a result of the adoption of ASC 842: (in thousands) December 31, 2021 Adjustments due to ASC 842 January 1, 2022 Prepaid expenses and other current assets $ 23,295 $ (229) $ 23,066 Other non-current assets $ 2,780 $ (496) $ 2,284 Operating lease right-of-use assets, net $ — $ 78,827 $ 78,827 Operating lease liabilities, current $ — $ 4,885 $ 4,885 Operating lease liabilities, non-current $ — $ 74,677 $ 74,677 Other current liabilities $ 6,716 $ (614) $ 6,102 Other non-current liabilities $ 3,209 $ (847) $ 2,362 The following table presents lease cost, cash paid for amounts included in the measurement of lease liabilities, weighted-average remaining lease terms, and weighted-average discount rates for finance and operating leases for the three months ended March 31, 2022. Three Months Ended (in thousands) March 31, 2022 Lease cost: Operating lease cost (1) $ 2,878 Finance lease cost Depreciation of finance lease assets (2) 372 Interest on finance lease liabilities (3) 42 Short-term lease cost (1) 251 Total lease cost $ 3,543 Other information: Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows from operating leases $ 1,180 Operating cash outflows from finance leases $ 35 Financing cash outflows from finance leases $ 480 Weighted-average remaining lease term - operating leases (in years) 14.7 Weighted-average remaining lease term - finance leases (in years) 2.2 Weighted-average discount rate - operating leases 4.4% Weighted-average discount rate - finance leases 3.7% (1) Included in Cost of revenue, Sales, marketing and customer support, Product development and General and administrative expenses in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. (2) Included in Depreciation and amortization in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. (3) Included in Interest expense in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. Maturities of lease liabilities for the remainder of 2022 and the years through 2028 and thereafter are as follows: March 31, 2022 (in thousands) Operating Leases Finance Leases 2022 $ 3,863 $ 1,541 2023 5,856 1,938 2024 6,671 598 2025 6,516 169 2026 6,463 — 2027 6,337 — 2028 and thereafter 80,610 — Total lease payments 116,316 4,246 Less amount representing interest (37,073) (176) Present value of total lease payments $ 79,243 $ 4,070 ASC 840 Comparative Disclosures The following tables, which were included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, present the Company’s future minimum lease payments under ASC 840 for all operating leases as of December 31, 2021. Future minimum lease payments differ from the future lease liability recognized under ASC 842, as the operating lease liability recognized under ASC 842 discounts the lease payments while the minimum operating lease payments presented below are not discounted. Operating Leases Year Ending (in thousands) December 31, 2022 $ 5,463 2023 4,381 2024 681 2025 439 2026 294 Thereafter 76 $ 11,334 Commitments On November 29, 2021, the Company entered into a non-cancellable contractual agreement to lease office space in New York, New York. The lease term for this office space commenced in January 2022 and will end in July 2038. The Company expects to move into the property in the second half of 2022 and at that time, the office space will become DoubleVerify’s new corporate headquarters. Year Ending (in thousands) December 31, 2022 $ — 2023 1,735 2024 5,987 2025 6,077 2026 6,168 Thereafter 86,872 $ 106,839 |
Fair Value Measurement
Fair Value Measurement | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Measurement | |
Fair Value Measurement | 8. Fair Value Measurement The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis: As of March 31, 2022 Quoted Market Prices in Active Significant ( in thousands) Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs Total Fair Value (Level 1) (Level 2) (Level 3) Measurements Assets: Cash equivalents $ 6,792 $ — $ — $ 6,792 Liabilities: Contingent consideration current — — — — Contingent consideration non-current — — — — Total contingent consideration $ — $ — $ — $ — As of December 31, 2021 Quoted Market Prices in Active Significant (in thousands) Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs Tota1 Fair Value (Level 1) (Level 2) (Level 3) Measurements Assets: Cash equivalents $ 12,324 $ — $ — $ 12,324 Liabilities: Contingent consideration current — — 1,717 1,717 Contingent consideration non-current — — — — Total contingent consideration $ — $ — $ 1,717 $ 1,717 Cash equivalents consisting of money market funds of $6.8 million and money market funds and time deposits of $12.3 million as of March 31, 2022 and December 31, 2021, respectively, were classified as Level 1 of the fair value hierarchy and valued using quoted market prices in active markets. As described in Note 4, Business Combinations, on February 16, 2022, pursuant to the terms of the Zentrick Early Termination Agreement, the Company paid the remaining balance of the contingent consideration referred to as the Zentrick Deferred Payment Terms. |
Long-term Debt
Long-term Debt | 3 Months Ended |
Mar. 31, 2022 | |
Long-term Debt. | |
Long-term Debt | 9. Long-term Debt On October 1, 2020, DoubleVerify Inc., as borrower (the “Borrower”), and MidCo, as guarantor, entered into an amendment and restatement agreement with the banks and other financial institutions party thereto, as lenders, and Capital One, National Association, as administrative agent, letter of credit issuer and swing lender, and others, to (i) amend and restate the Prior Credit Agreement as defined in the Prospectus (the Prior Credit Agreement, as amended and restated on October 1, 2020, the “Credit Agreement”) and (ii) replace the Prior Credit Facilities (as defined in the Prospectus) with a new senior secured revolving credit facility (the “New Revolving Credit Facility”) in an aggregate principal amount of $150.0 million (with a letter of credit facility of up to $15.0 million as a sublimit). Subject to certain terms and conditions, the Borrower is entitled to request additional term loan facilities or increases in the revolving credit commitments under the New Revolving Credit Facility. The New Revolving Credit Facility is payable in quarterly installments for interest, with the principal balance due in full at maturity on October 1, 2025. Additional fees paid quarterly include fees for the unused revolving facility and unused letter of credit. The commitment fee on any unused balance is payable periodically and may range from 0.25% to 0.40% based upon the total net leverage ratio. The New Revolving Credit Facility bears interest at LIBOR plus 2.25%, which may vary from time to time based on the Borrower’s total net leverage ratio calculated in accordance with the Credit Agreement. The New Revolving Credit Facility contains a number of significant negative covenants. Subject to certain exceptions, these covenants require the Borrower to comply with certain requirements and restrictions to, among other things: incur indebtedness; create liens; engage in mergers or consolidations; make investments, loans and advances; pay dividends or other distributions and repurchase capital stock; sell assets; engage in certain transactions with affiliates; enter into sale and leaseback transactions; and make certain accounting changes. As a result of these restrictions, substantially all of the net assets of the Borrower are restricted from distribution to the Company or any of its holders of equity. The New Revolving Credit Facility has a first priority lien on substantially all of the assets of MidCo, the Borrower and Ad-Juster, the Company’s indirect subsidiary. The New Revolving Credit Facility requires the Borrower to remain in compliance with a maximum total net leverage ratio and a minimum fixed charge coverage ratio as defined in the Credit Agreement. As of March 31, 2022, the maximum total net leverage ratio and minimum fixed charge coverage ratio is 3.5x and 1.25x, respectively. The Borrower is in compliance with all covenants under the New Revolving Credit Facility as of March 31, 2022. As of March 31, 2022 and December 31, 2021, there was $0 outstanding under the New Revolving Credit Facility. |
Income Tax
Income Tax | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax | |
Income Tax | 10. Income Tax The Company’s quarterly income tax provision is calculated using an estimated annual effective income tax rate ("ETR") based on actual historical information and forward-looking estimates. The Company’s estimated annual ETR may fluctuate due to changes in forecasted annual pre-tax income, changes in the jurisdictional mix of forecasted pre-tax income, and changes to actual or forecasted permanent book to tax differences (e.g., non-deductible expenses). In addition, the Company’s ETR for a particular reporting period may fluctuate as the result of changes to the valuation allowance for net deferred tax assets, the impact of anticipated tax settlements with federal, state, or foreign tax authorities, or the impact of tax law changes. The Company identifies items that are unusual and non-recurring in nature and treat these as discrete events. The tax effect of these discrete events is booked entirely in the quarter in which they occur. During the three months ended March 31, 2022, the Company recorded an income tax benefit of $2.0 million, resulting in an effective tax rate of (77.4%), which includes an annualized effective tax provision of $0.9 million (representing an effective tax rate of 35.7%) and a discrete item relating excess tax benefit from share-based compensation of $2.9 million (representing an effective tax rate of (113.1%)). During the three months ended March 31, 2021, the Company recorded an income tax provision of $2.8 million, resulting in an effective tax rate of 33.1%. These effective tax rates differ from the U.S. federal statutory rate primarily due to the effects of various book-to-tax adjustments, foreign tax rate differences, U.S. tax on foreign operations, and U.S. state/local taxes. A valuation allowance has been established against a small amount of foreign capital losses and certain U.S. tax loss carryforwards. All other net deferred tax assets have been determined to be more likely than not realizable. The Company regularly reviews its deferred tax assets for recoverability and would establish a valuation allowance if it believed that such assets may not be recovered, taking into consideration historical operating results, expectations of future earnings, changes in its operations, and the expected timing of the reversals of existing temporary differences. The Company accounts for uncertainty in income taxes utilizing ASC 740-10, "Income Taxes". ASC 740-10 clarifies whether or not to recognize assets or liabilities for tax positions taken that may be challenged by a tax authority. It prescribes a recognition threshold and measurement attribute for financial statement disclosure of tax positions taken or expected to be taken. This interpretation also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, and disclosures. The application of ASC 740-10 requires judgment related to the uncertainty in income taxes and could impact our effective tax rate. DoubleVerify and its subsidiaries file income tax returns with the Internal Revenue Service (“IRS”) and various state and international jurisdictions. The Company’s Israeli subsidiary is under audit by the Israeli Tax Authority for the 2016-2018 tax years. This examination may lead to ordinary course adjustments or proposed adjustments to the Company’s taxes. Aside from this, the Company is not currently under audit in any other jurisdiction. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share | |
Earnings Per Share | 11. Earnings Per Share The following table reconciles the numerators and denominators used in computations of the basic and diluted EPS for the three months ended March 31, 2022 and March 31, 2021: Three Months Ended March 31, 2022 2021 Numerator: Net Income (basic and diluted) $ 4,579 $ 5,644 Denominator: Weighted-average common shares outstanding 162,612 125,112 Dilutive effect of share-based awards 7,827 8,466 Weighted-average dilutive shares outstanding 170,439 133,578 Basic earnings per share $ 0.03 $ 0.05 Diluted earnings per share $ 0.03 $ 0.04 Approximately 4.9 million and 4.4 million weighted average shares issuable under stock-based awards were not included in the diluted EPS calculation in the three months ended March 31, 2022 and March 31, 2021, respectively, because they were antidilutive. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2022 | |
Stock-Based Compensation | |
Stock-Based Compensation | 12. Stock-Based Compensation Employee Equity Incentive Plan On September 20, 2017, the Company established its 2017 Omnibus Equity Incentive Program (the “2017 Plan”) which provides for the granting of equity-based awards to certain employees, directors, independent contractors, consultants and agents. Under the 2017 Plan, the Company may grant non-qualified stock options, stock appreciation rights, restricted stock units, and other stock-based awards. On April 19, 2021 the Company established its 2021 Omnibus Equity Incentive Plan (“2021 Equity Plan”). The 2021 Equity Plan provides for the grant of stock options (including qualified incentive stock options and nonqualified stock options), stock appreciation rights, restricted stock, restricted stock units, dividend equivalents, and other stock or cash settled incentive awards. Options become exercisable subject to vesting schedules up to four years from the date of the grant and subject to certain timing restrictions upon an employee’s separation of service and no later than 10 years after the grant date. Restricted stock units are subject to vesting schedules up to four years from the date of the grant and subject to certain timing restrictions upon an employee’s separation. A summary of stock option activity as of and for the three months ended March 31, 2022 is as follows: Stock Option Weighted Average Remaining Number of Weighted Average Contractual Life Aggregate Options Exercise Price (Years) Intrinsic Value Outstanding as of December 31, 2021 12,117 $ 10.84 7.53 $ 274,684 Options granted 289 29.10 Options exercised (574) 2.96 Options forfeited (48) 13.93 Outstanding as of March 31, 2022 11,784 $ 11.66 7.53 $ 177,919 Options expected to vest as of March 31, 2022 4,595 $ 20.50 8.80 $ 37,025 Options exercisable as of March 31, 2022 6,884 $ 5.04 6.59 $ 139,802 Stock options include grants to executives that contain both market-based and performance-based vesting conditions. There were no stock options granted that contain both market-based and performance-based vesting conditions during the three months ended March 31, 2022. As of March 31, 2022, 2,255 market-based and performance-based awards were outstanding, with 336 stock options exercised for the three months ended March 31, 2022. The weighted average grant date fair value of options granted during the three months ended March 31, 2022 and March 31, 2021 was $12.77 and $8.39, respectively. The total intrinsic value of options exercised during the three months ended March 31, 2022 and March 31, 2021 was $12.1 million and $3.3 million, respectively. The fair market value of each option granted during the three months ended March 31, 2022 has been estimated on the grant date using the Black-Scholes-Merton option-pricing model with the following assumptions: 2022 Risk - free interest rate (percentage) 2.0 Expected term (years) 6.1 Expected dividend yield (percentage) — Expected volatility (percentage) 42.8 The Company’s board of directors (the “Board”) did not declare or pay dividends on any Company stock during the three months ended March 31, 2022 or during the three months ended March 31, 2021. A summary of restricted stock unit activity as of and for the three months ended March 31, 2022 is as follows: Restricted Stock Units Number of Weighted Average Shares Grant Date Fair Value Outstanding as of December 31, 2021 3,250 $ 24.20 Granted 379 29.07 Vested (195) 25.72 Forfeited (59) 21.51 Outstanding as of March 31, 2022 3,375 $ 24.70 The total grant date fair value of restricted stock units that vested during the three months ended March 31, 2022 was $5.0 million. As of March 31, 2022, unrecognized stock-based compensation expense was $96.6 million, which is expected to be recognized over a weighted-average period of 1.4 years. Total stock-based compensation expense recorded in the Condensed Consolidated Statements of Operations and Comprehensive Income as follows: Three Months Ended March 31, (in thousands) 2022 2021 Product development $ 3,366 $ 278 Sales, marketing and customer support 3,829 624 General and administrative 3,799 1,636 Total stock-based compensation $ 10,994 $ 2,538 Employee Stock Purchase Plan In March 2021, the Board approved the Company’s 2021 Employee Stock Purchase Plan (“ESPP”), and employees became eligible to enroll in August 2021. Purchases are accomplished through participation in discrete offering periods. Currently, the ESPP is available only to U.S. based employees, and the Company plans to expand participation in the ESPP to most of the Company’s non-U.S. locations in 2022. The current offering period began on December 1, 2021 and will end on May 31, 2022. The Company expects the program to continue consecutively for six-month offering periods for the foreseeable future. Under the ESPP, eligible employees are able to acquire shares of the Company’s common stock by accumulating funds through payroll deductions. The purchase price for shares of common stock purchased under the ESPP is 85% of the lesser of the fair market value of the common stock on (i) the first trading day of the applicable offering period and (ii) the last trading day of the applicable offering period. Stock-based compensation expense for the ESPP is recognized on a straight-line basis over the requisite service period of each award. The ESPP also has a six-month holding period after the purchase date of the offering period. Stock-based compensation expense related to ESPP totaled $0.1 million for the three months ended March 31, 2022. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | 13. Commitments and Contingencies Accrued Expense Accrued expenses as of March 31, 2022 and December 31, 2021 were as follows: As of (in thousands) March 31, 2022 December 31, 2021 Vendor payments $ 3,478 $ 3,639 Employee commissions and bonuses 11,019 13,324 Payroll and other employee related expense 10,071 18,879 401k and pension expense 565 1,775 Other taxes 1,057 1,026 Other costs (a) — 2,813 Total accrued expense $ 26,190 $ 41,456 (a) Includes accrued expense related to the early termination of the Zentrick Deferred Payment Terms, as described in Note 4, Business Combinations. Contingencies From time to time, the Company is subject to various legal proceedings and claims, either asserted or unasserted, that arise in the ordinary course of business. The Company records liabilities for contingencies including legal costs when it is probable that a liability has been incurred and when the amount can be reasonably estimated. Legal costs are expensed as incurred. Although the outcome of the various legal proceedings and claims cannot be predicted with certainty, management does not believe that any of these proceedings or other claims will have a material effect on the Company’s business, financial condition, results of operations or cash flows. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2022 | |
Segment Information | |
Segment Information | 14. Segment Information The Company has determined that it operates as one operating and reportable |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events | |
Subsequent Events | 15. Subsequent Events On May 3, 2022, the Company approved 137 stock options and 560 restricted stock units to be granted to employees under the 2021 Equity Plan. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Basis of Presentation and Summary of Significant Accounting Policies | |
Basis of Preparation and Principles of Consolidation | Basis of Preparation and Principles of Consolidation The accompanying Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021, the Condensed Consolidated Statements of Operations and Comprehensive Income for the three months ended March 31, 2022 and 2021, the Condensed Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2022 and 2021, and the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 reflect all adjustments that are of a normal recurring nature and that are considered necessary for a fair presentation of the results for the periods shown in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules and regulations of the SEC for interim financial reporting periods. Accordingly, certain information and footnote disclosures have been condensed or omitted pursuant to SEC rules that would ordinarily be required under GAAP for complete financial statements. These unaudited interim Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in its Annual Report on Form 10-K for the year ended December 31, 2021. In the Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021, the Company changed the presentation in describing the changes in operating assets and liabilities by combining the lines for Accrued expenses, Other current liabilities, and Other non-current liabilities into a single line item. The Company further combined Prepaid expenses and other current assets and Other non-current assets into a single line item. Both the original and new presentations are in accordance with the applicable financial reporting framework and the change was applied retrospectively solely to enhance the comparability with the current Condensed Consolidated Statements of Cash Flows. |
Use of Estimates and Judgments in the Preparation of the Condensed Consolidated Financial Statements | Use of Estimates and Judgments in the Preparation of the Condensed Consolidated Financial Statements The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenue and expense during the reporting periods. Significant estimates and judgments are inherent in the analysis and measurement of items including, but not limited to: revenue recognition criteria including the determination of principal versus agent revenue considerations, income taxes, the valuation and recoverability of goodwill and intangible assets, the assessment of potential loss from contingencies, assumptions in valuing acquired assets and liabilities assumed in business combinations, the allowance for doubtful accounts, and assumptions used in determining the fair value of stock-based compensation. Management bases its estimates and assumptions on historical experience and on various other factors that are believed to be reasonable under the circumstances. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may be affected by changes in those estimates. These estimates are based on the information available as of the date of the Condensed Consolidated Financial Statements . |
Recently Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements Leases In February 2016, the FASB issued ASU No. 2016-02, Leases In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases Leases: Targeted Improvements The amendments in ASU No. 2016-02, ASU No. 2018-10 and ASU No. 2018-11 are effective for fiscal years beginning after December 15, 2021, for non-public entities and interim periods within fiscal years beginning after December 15, 2022, and allow for modified retrospective adoption with early adoption permitted. The Company adopted the amendments on January 1, 2022 using the modified retrospective approach and elected the transition relief package of practical expedients by applying previous accounting conclusions under ASC 840 to all leases that existed prior to the transition date. There was no impact to retained earnings upon the adoption of ASC 842. As a result of the adoption, the Company did not reassess 1) whether existing or expired contracts contain leases, 2) lease classification for any existing or expired leases, and 3) whether lease origination costs qualified as initial direct costs. The Company did not elect the practical expedient to use hindsight in determining a lease term and impairment of the ROU assets at the adoption date. Additionally, the Company did not separate lease components from non-lease components for the specified asset classes. Furthermore, the Company did not apply the recognition requirements under ASC 842 to short-term leases, generally defined as a lease term of less than one year. The Company has operating and financing leases for corporate offices, data centers, and certain equipment. The leases have remaining lease terms ranging from less than The Company determines if an arrangement is a lease at inception and does not recognize a lease with a term shorter than 12 months. An ROU asset represents the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease ROU assets and lease liabilities are to be recognized at commencement date based on the present value of lease payments not yet paid over the lease term. As the Company’s operating leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available on the adoption date in determining the present value of lease payments not yet paid. The incremental borrowing rate for United States dollar denominated leases was calculated by considering current market yields and the Company’s existing debt rates to determine a yield. In order to assess a premium or discount for the lease tenor and develop an incremental borrowing rate curve, the analysis compared the Company’s existing debt yield to the appropriate market yield curve corresponding to the Company’s secured rating. The curve one notch higher was used as the incremental borrowing rate focuses on secured borrowing rates, which tend to carry higher credit ratings when issued. The corporate yield curve was adjusted based on the Company’s implied incremental borrowing rate premium or discount at each tenor to reach a concluded incremental borrowing rate curve. Using the calculated United States dollar incremental borrowing rate, the international incremental borrowing rates were determined by adjusting for specific country risk. The operating lease ROU assets include any lease payments made prior to the rent commencement date and exclude lease incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Operating lease transactions are included in Operating lease right-of-use assets, net, and Operating lease liabilities, current and noncurrent, within the accompanying Condensed Consolidated Balance Sheets. Finance leases, formerly known as (“f/k/a”) Capital leases, are included in Property, plant and equipment, net, Current portion of finance lease obligations, and Finance lease obligations within the accompanying Condensed Consolidated Balance Sheets. Refer to Note 7, Leases, for further information. Recently Issued Accounting Pronouncements The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act (“JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with certain new or revised accounting standards. Financial Instruments - Credit Losses In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes (Topic 740) |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Revenue | |
Schedule of disaggregated revenue | Three Months Ended March 31, ( in thousands) 2022 2021 Measurement (f/k/a Advertiser - direct) $ 33,834 $ 27,541 Activation (f/k/a Advertiser - programmatic) 53,031 33,912 Supply-side customer 9,858 6,133 Total revenue $ 96,723 $ 67,586 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets | |
summary of changes to the goodwill carrying value | (in thousands) Goodwill at December 31, 2021 $ 350,560 Measurement period adjustments (6,915) Foreign exchange impact (979) Goodwill at March 31, 2022 $ 342,666 |
Schedule of intangible assets and related accumulated amortization | ( in thousands) March 31, 2022 December 31, 2021 Gross Carrying Accumulated Net Carrying Gross Carrying Accumulated Net Carrying Amount Amortization Amount Amount Amortization Amount Trademarks and brands $ 11,734 $ (3,644) $ 8,090 $ 11,735 $ (3,422) $ 8,313 Customer relationships 146,093 (40,044) 106,049 143,728 (36,831) 106,897 Developed technology 77,071 (36,746) 40,325 72,065 (33,937) 38,128 Non-compete agreements 67 (19) 48 68 (11) 57 Total intangible assets $ 234,965 $ (80,453) $ 154,512 $ 227,596 $ (74,201) $ 153,395 (In years) Trademarks and brands 10 Customer relationships 8 Developed technology 4 Non-compete agreements 1 |
Schedule of Estimated future expected amortization expense of intangible assets | (in thousands) 2022 (for remaining nine months) $ 18,725 2023 24,901 2024 23,341 2025 21,199 2026 16,094 2027 13,884 Thereafter 36,368 Total $ 154,512 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment | |
Schedule of Property, Plant and Equipment | As of (in thousands) March 31, 2022 December 31, 2021 Computers and peripheral equipment $ 18,948 $ 18,883 Office furniture and equipment 494 1,102 Leasehold improvements 8,428 9,354 Capitalized software development costs 16,593 15,007 Less accumulated depreciation and amortization (25,311) (26,771) Total property, plant and equipment, net $ 19,152 $ 17,575 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Lessee, Lease, Description [Line Items] | |
Schedule of cumulative effect of the changes made to the Condensed Consolidated Balance Sheet | (in thousands) December 31, 2021 Adjustments due to ASC 842 January 1, 2022 Prepaid expenses and other current assets $ 23,295 $ (229) $ 23,066 Other non-current assets $ 2,780 $ (496) $ 2,284 Operating lease right-of-use assets, net $ — $ 78,827 $ 78,827 Operating lease liabilities, current $ — $ 4,885 $ 4,885 Operating lease liabilities, non-current $ — $ 74,677 $ 74,677 Other current liabilities $ 6,716 $ (614) $ 6,102 Other non-current liabilities $ 3,209 $ (847) $ 2,362 |
Schedule of lease cost and other information about leases | Three Months Ended (in thousands) March 31, 2022 Lease cost: Operating lease cost (1) $ 2,878 Finance lease cost Depreciation of finance lease assets (2) 372 Interest on finance lease liabilities (3) 42 Short-term lease cost (1) 251 Total lease cost $ 3,543 Other information: Cash paid for amounts included in the measurement of lease liabilities Operating cash outflows from operating leases $ 1,180 Operating cash outflows from finance leases $ 35 Financing cash outflows from finance leases $ 480 Weighted-average remaining lease term - operating leases (in years) 14.7 Weighted-average remaining lease term - finance leases (in years) 2.2 Weighted-average discount rate - operating leases 4.4% Weighted-average discount rate - finance leases 3.7% (1) Included in Cost of revenue, Sales, marketing and customer support, Product development and General and administrative expenses in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. (2) Included in Depreciation and amortization in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. (3) Included in Interest expense in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income. |
Schedule of the future operating lease commitment under agreement | Maturities of lease liabilities for the remainder of 2022 and the years through 2028 and thereafter are as follows: March 31, 2022 (in thousands) Operating Leases Finance Leases 2022 $ 3,863 $ 1,541 2023 5,856 1,938 2024 6,671 598 2025 6,516 169 2026 6,463 — 2027 6,337 — 2028 and thereafter 80,610 — Total lease payments 116,316 4,246 Less amount representing interest (37,073) (176) Present value of total lease payments $ 79,243 $ 4,070 |
Schedule of maturities of finance lease liabilities | March 31, 2022 (in thousands) Operating Leases Finance Leases 2022 $ 3,863 $ 1,541 2023 5,856 1,938 2024 6,671 598 2025 6,516 169 2026 6,463 — 2027 6,337 — 2028 and thereafter 80,610 — Total lease payments 116,316 4,246 Less amount representing interest (37,073) (176) Present value of total lease payments $ 79,243 $ 4,070 |
Schedule of future minimum lease obligations | The following tables, which were included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, present the Company’s future minimum lease payments under ASC 840 for all operating leases as of December 31, 2021. Future minimum lease payments differ from the future lease liability recognized under ASC 842, as the operating lease liability recognized under ASC 842 discounts the lease payments while the minimum operating lease payments presented below are not discounted. Operating Leases Year Ending (in thousands) December 31, 2022 $ 5,463 2023 4,381 2024 681 2025 439 2026 294 Thereafter 76 $ 11,334 |
NEW YORK | |
Lessee, Lease, Description [Line Items] | |
Schedule of future minimum lease obligations | Year Ending (in thousands) December 31, 2022 $ — 2023 1,735 2024 5,987 2025 6,077 2026 6,168 Thereafter 86,872 $ 106,839 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Measurement | |
Schedule of financial instruments measured at fair value on recurring basis | As of March 31, 2022 Quoted Market Prices in Active Significant ( in thousands) Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs Total Fair Value (Level 1) (Level 2) (Level 3) Measurements Assets: Cash equivalents $ 6,792 $ — $ — $ 6,792 Liabilities: Contingent consideration current — — — — Contingent consideration non-current — — — — Total contingent consideration $ — $ — $ — $ — As of December 31, 2021 Quoted Market Prices in Active Significant (in thousands) Markets for Significant Other Unobservable Identical Assets Observable Inputs Inputs Tota1 Fair Value (Level 1) (Level 2) (Level 3) Measurements Assets: Cash equivalents $ 12,324 $ — $ — $ 12,324 Liabilities: Contingent consideration current — — 1,717 1,717 Contingent consideration non-current — — — — Total contingent consideration $ — $ — $ 1,717 $ 1,717 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share | |
Schedule of computations of the basic and diluted EPS | Three Months Ended March 31, 2022 2021 Numerator: Net Income (basic and diluted) $ 4,579 $ 5,644 Denominator: Weighted-average common shares outstanding 162,612 125,112 Dilutive effect of share-based awards 7,827 8,466 Weighted-average dilutive shares outstanding 170,439 133,578 Basic earnings per share $ 0.03 $ 0.05 Diluted earnings per share $ 0.03 $ 0.04 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Stock-Based Compensation | |
Schedule of stock option activity | Stock Option Weighted Average Remaining Number of Weighted Average Contractual Life Aggregate Options Exercise Price (Years) Intrinsic Value Outstanding as of December 31, 2021 12,117 $ 10.84 7.53 $ 274,684 Options granted 289 29.10 Options exercised (574) 2.96 Options forfeited (48) 13.93 Outstanding as of March 31, 2022 11,784 $ 11.66 7.53 $ 177,919 Options expected to vest as of March 31, 2022 4,595 $ 20.50 8.80 $ 37,025 Options exercisable as of March 31, 2022 6,884 $ 5.04 6.59 $ 139,802 |
Schedule of Black-Scholes-Merton option-pricing model | 2022 Risk - free interest rate (percentage) 2.0 Expected term (years) 6.1 Expected dividend yield (percentage) — Expected volatility (percentage) 42.8 |
Schedule of restricted stock activity | Restricted Stock Units Number of Weighted Average Shares Grant Date Fair Value Outstanding as of December 31, 2021 3,250 $ 24.20 Granted 379 29.07 Vested (195) 25.72 Forfeited (59) 21.51 Outstanding as of March 31, 2022 3,375 $ 24.70 |
Schedule of stock-based compensation expense | Three Months Ended March 31, (in thousands) 2022 2021 Product development $ 3,366 $ 278 Sales, marketing and customer support 3,829 624 General and administrative 3,799 1,636 Total stock-based compensation $ 10,994 $ 2,538 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies. | |
Schedule of accrued expenses | As of (in thousands) March 31, 2022 December 31, 2021 Vendor payments $ 3,478 $ 3,639 Employee commissions and bonuses 11,019 13,324 Payroll and other employee related expense 10,071 18,879 401k and pension expense 565 1,775 Other taxes 1,057 1,026 Other costs (a) — 2,813 Total accrued expense $ 26,190 $ 41,456 |
Description of Business (Detail
Description of Business (Details) - segment | 3 Months Ended | |
Mar. 31, 2022 | Aug. 18, 2017 | |
Business Combinations | ||
Number of reportable segments | 1 | |
DoubleVerify Inc. | ||
Business Combinations | ||
Ownership percentage acquired | 100.00% |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Details) | Mar. 31, 2022 |
Minimum | |
Operating leases, remaining lease terms | 1 year |
Financing leases, remaining lease terms | 1 year |
Maximum | |
Operating leases, remaining lease terms | 17 years |
Financing leases, remaining lease terms | 17 years |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Disaggregation of revenue | |||
Total revenue | $ 96,723 | $ 67,586 | |
Unbilled receivable | 39,700 | $ 55,700 | |
Measurement (f/k/a Advertiser - direct) | |||
Disaggregation of revenue | |||
Total revenue | 33,834 | 27,541 | |
Activation (f/k/a Advertiser - programmatic) | |||
Disaggregation of revenue | |||
Total revenue | 53,031 | 33,912 | |
Supply - side customer | |||
Disaggregation of revenue | |||
Total revenue | $ 9,858 | $ 6,133 |
Business Combinations - OpenSla
Business Combinations - OpenSlate (Details) - Open Slate - USD ($) $ in Millions | Nov. 22, 2021 | Mar. 31, 2022 |
Business Acquisition [Line Items] | ||
Aggregate net cash purchase price | $ 148.2 | |
Business combination, working capital adjustment | 0.8 | |
Business combination, working capital adjustment due to changes in intangible assets | 7.7 | |
Business combination, working capital adjustment due to changes in purchase consideration | 0.8 | |
Business combination, working capital adjustment due to changes in accrued expenses | 0.1 | |
Weighted-average useful life | 8 years 9 months 18 days | |
Acquisition cost | $ 0.2 | |
Developed technology | ||
Business Acquisition [Line Items] | ||
Estimated useful life | 5 years | |
Customer relationships | ||
Business Acquisition [Line Items] | ||
Estimated useful life | 10 years |
Business Combinations - Zentric
Business Combinations - Zentrick NV acquisition - Narrative (Details) - Zentrick NV $ in Millions | Feb. 16, 2022USD ($) | Feb. 15, 2019USD ($)Milestonecomponent |
Business Combinations | ||
Closing adjustments | $ 0.2 | |
Consideration held back | 0.1 | |
Performance based deferred payment | $ 17.3 | |
Number of component | component | 2 | |
Performance based deferred payment, First component | $ 4 | |
Number of milestone | Milestone | 4 | |
Amour per milestone | $ 1 | |
Performance based deferred payment, Second component | 13 | |
Payment of contingent consideration | $ 5.6 | |
Cash consideration | $ 23.2 | |
Tranche one | ||
Business Combinations | ||
Percentage of holdback payments | 50.00% | |
Holdback payments payable period | 12 months | |
Tranche two | ||
Business Combinations | ||
Percentage of holdback payments | 50.00% | |
Holdback payments payable period | 24 months |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Changes to the goodwill carrying value | |
Goodwill as of December 31, 2021 | $ 350,560 |
Measurement period adjustments | (6,915) |
Foreign exchange impact | (979) |
Goodwill at March 31, 2022 | $ 342,666 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of Company's intangible assets (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 234,965 | $ 227,596 | |
Accumulated Amortization | (80,453) | (74,201) | |
Total | 154,512 | 153,395 | |
Amortization expense | 6,300 | $ 4,500 | |
Trademarks and brands | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 11,734 | 11,735 | |
Accumulated Amortization | (3,644) | (3,422) | |
Total | 8,090 | 8,313 | |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 146,093 | 143,728 | |
Accumulated Amortization | (40,044) | (36,831) | |
Total | 106,049 | 106,897 | |
Developed technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 77,071 | 72,065 | |
Accumulated Amortization | (36,746) | (33,937) | |
Total | 40,325 | 38,128 | |
Non-compete agreements | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | 67 | 68 | |
Accumulated Amortization | (19) | (11) | |
Total | $ 48 | $ 57 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Estimated future expected amortization expense (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2022 (for remaining nine months) | $ 18,725 | |
2023 | 24,901 | |
2024 | 23,341 | |
2025 | 21,199 | |
2026 | 16,094 | |
2027 | 13,884 | |
Thereafter | 36,368 | |
Total | $ 154,512 | $ 153,395 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Weighted-average remaining useful life (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Impairment of intangible assets | $ 0 | $ 0 |
Trademarks and brands | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remaining useful life | 10 years | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remaining useful life | 8 years | |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remaining useful life | 4 years | |
Non-compete agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remaining useful life | 1 year |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Less: Accumulated Depreciation and Amortization | $ (25,311) | $ (26,771) | |
Total property, plant and equipment, net | 19,152 | 17,575 | |
Depreciation expense | 2,700 | $ 2,600 | |
Computers and Peripheral Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment gross | 18,948 | 18,883 | |
Finance lease assets | 12,300 | 12,300 | |
Finance lease assets, accumulated depreciation | 10,300 | 10,000 | |
Office Furniture and Equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment gross | 494 | 1,102 | |
Leasehold Improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment gross | 8,428 | 9,354 | |
Capitalized software development costs | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment gross | $ 16,593 | $ 15,007 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2021 |
Leases | |||
Prepaid expenses and other current assets | $ 24,979 | $ 23,066 | $ 23,295 |
Other non-current assets | 1,859 | 2,284 | 2,780 |
Operating lease right-of-use assets, net | 76,825 | 78,827 | |
Operating lease liabilities, current | 4,909 | 4,885 | |
Operating lease liabilities, non-current | 74,334 | 74,677 | |
Other current liabilities | 6,745 | 6,102 | 6,716 |
Other non-current liabilities | $ 2,638 | 2,362 | 3,209 |
Previously Reported | |||
Leases | |||
Prepaid expenses and other current assets | 23,295 | ||
Other non-current assets | 2,780 | ||
Other current liabilities | 6,716 | ||
Other non-current liabilities | $ 3,209 | ||
Accounting Standards Update 2016-02 | Adjustments due to ASC 842 | |||
Leases | |||
Prepaid expenses and other current assets | (229) | ||
Other non-current assets | (496) | ||
Operating lease right-of-use assets, net | 78,827 | ||
Operating lease liabilities, current | 4,885 | ||
Operating lease liabilities, non-current | 74,677 | ||
Other current liabilities | (614) | ||
Other non-current liabilities | $ (847) |
Leases - Leases Cost (Details)
Leases - Leases Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Lease cost: | ||
Operating lease cost (1) | $ 2,878 | |
Finance lease cost | ||
Depreciation of finance lease assets (2) | 372 | |
Interest on finance lease liabilities (3) | 42 | |
Short-term lease cost (1) | 251 | |
Total lease cost | 3,543 | |
Cash paid for amounts included in the measurement of lease liabilities | ||
Operating cash outflows from operating leases | 1,180 | |
Operating cash outflows from finance leases | 35 | |
Financing cash outflows from finance leases | $ 480 | $ 235 |
Weighted-average remaining lease term - operating leases (in years) | 14 years 8 months 12 days | |
Weighted-average remaining lease term - finance leases (in years) | 2 years 2 months 12 days | |
Weighted-average discount rate - operating leases | 4.40% | |
Weighted-average discount rate - finance leases | 3.70% |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Maturities of operating lease liabilities | |
2022 | $ 3,863 |
2023 | 5,856 |
2024 | 6,671 |
2025 | 6,516 |
2026 | 6,463 |
2027 | 6,337 |
2028 and thereafter | 80,610 |
Total | 116,316 |
Less amount representing interest | (37,073) |
Present value of total lease payments | $ 79,243 |
Leases - Maturities of Finance
Leases - Maturities of Finance Lease Liabilities (Details) $ in Thousands | Mar. 31, 2022USD ($) |
Maturities of finance lease liabilities | |
2022 | $ 1,541 |
2023 | 1,938 |
2024 | 598 |
2025 | 169 |
Total lease payments | 4,246 |
Less amount representing interest | (176) |
Present value of total lease payments | $ 4,070 |
Leases - Operating Leases (Deta
Leases - Operating Leases (Details) $ in Thousands | Dec. 31, 2021USD ($) |
Operating leases future minimum lease obligations | |
2022 | $ 5,463 |
2023 | 4,381 |
2024 | 681 |
2025 | 439 |
2026 | 294 |
Thereafter | 76 |
Total | 11,334 |
Office | NEW YORK | |
Operating leases future minimum lease obligations | |
2023 | 1,735 |
2024 | 5,987 |
2025 | 6,077 |
2026 | 6,168 |
Thereafter | 86,872 |
Total | $ 106,839 |
Fair Value Measurement - Fair v
Fair Value Measurement - Fair value on a recurring basis (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Liabilities: | ||
Contingent consideration current | $ 1,717 | |
Recurring | ||
Assets: | ||
Cash equivalents: | $ 6,792 | 12,324 |
Liabilities: | ||
Contingent consideration current | 1,717 | |
Total contingent consideration | 1,717 | |
Recurring | Level 1 | ||
Assets: | ||
Cash equivalents: | $ 6,792 | 12,324 |
Recurring | Level 3 | ||
Liabilities: | ||
Contingent consideration current | 1,717 | |
Total contingent consideration | $ 1,717 |
Fair Value Measurement - Narrat
Fair Value Measurement - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Level 1 | Money market funds and time deposits | Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 6.8 | $ 12.3 |
Long-term Debt (Details)
Long-term Debt (Details) $ in Millions | Oct. 01, 2020USD ($) | Mar. 31, 2022USD ($) | Dec. 31, 2021USD ($) |
Debt Instrument [Line Items] | |||
Maximum total net leverage ratio | 3.5 | ||
Minimum fixed charge coverage ratio | 1.25 | ||
Minimum | |||
Debt Instrument [Line Items] | |||
Percentage of commitment fee payable periodically | 0.25% | ||
Maximum | |||
Debt Instrument [Line Items] | |||
Percentage of commitment fee payable periodically | 0.40% | ||
Letter of Credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 15 | ||
New Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 150 | ||
Outstanding amount | $ 0 | $ 0 | |
New Revolving Credit Facility | LIBOR | |||
Debt Instrument [Line Items] | |||
Spread rate | 2.25% |
Income Tax (Details)
Income Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Tax | ||
Income tax benefit (provision) | $ (1,998) | $ 2,793 |
Effective tax rate | (77.40%) | 33.10% |
Annualized effective tax benefit | $ (900) | |
Annualized effective tax rate | 35.70% | |
Share-based compensation, tax benefit | $ 2,900 | |
Share-based compensation, tax benefit, effective tax rate | 113.10% |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Numerator: | ||
Net Income (basic and diluted) | $ 4,579 | $ 5,644 |
Denominator: | ||
Weighted-average common shares outstanding | 162,612 | 125,112 |
Dilutive effect of share-based awards | 7,827 | 8,466 |
Weighted-average dilutive shares outstanding | 170,439 | 133,578 |
Basic earnings per share | $ 0.03 | $ 0.05 |
Diluted earnings per share | $ 0.03 | $ 0.04 |
Weighted average shares issuable under stock-based awards, excluded from diluted EPS calculation | 4,900 | 4,400 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Equity Incentive Program | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Term of award | 10 years |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 4 years |
Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 4 years |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock option activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Number of Options | ||
Outstanding beginning balance | 12,117 | |
Options granted | 289 | |
Options exercised | (574) | |
Options forfeited | (48) | |
Outstanding Ending balance | 11,784 | 12,117 |
Options expected to vest | 4,595 | |
Options exercisable | 6,884 | |
Weighted Average Exercise Price | ||
Outstanding beginning balance (in dollars per share) | $ 10.84 | |
Options granted (in dollars per share) | 29.10 | |
Options exercised (in dollars per share) | 2.96 | |
Options forfeited (in dollars per share) | 13.93 | |
Outstanding ending balance (in dollars per share) | 11.66 | $ 10.84 |
Options expected to vest (in dollars per share) | 20.50 | |
Options exercisable (in dollars per share) | $ 5.04 | |
Additional disclosures | ||
Weighted Average Remaining Contractual Life (Years) | 7 years 6 months 10 days | 7 years 6 months 10 days |
Options expected to vest (in years) | 8 years 9 months 18 days | |
Options exercisable (Years) | 6 years 7 months 2 days | |
Aggregate Intrinsic Value, outstanding (Beginning balance) | $ 274,684 | |
Aggregate Intrinsic Value, outstanding (ending balance) | 177,919 | $ 274,684 |
Aggregate Intrinsic Value, expected to vest | 37,025 | |
Aggregate Intrinsic Value, exercisable | $ 139,802 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional information (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding Ending balance | 11,784 | |
Weighted average grant date fair value (in dollars per share) | $ 12.77 | $ 8.39 |
Intrinsic value | $ 12,100 | $ 3,300 |
Options exercised | 574 | |
Unrecognized stock-based compensation expense | $ 96,600 | |
Stock-based compensation expense | $ 10,994 | $ 2,538 |
Weighted-average period over which unrecognized stock-based compensation expense are expected to be recognized | 1 year 4 months 24 days | |
Performance and Market Based Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted | 0 | |
Outstanding Ending balance | 2,255 | |
Options exercised | 336 | |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted | 379 | |
Vested | 195 | |
Vested, Fair value | $ 5,000 | |
Granted, Weighted average grant date fair value | $ 29.07 |
Stock-Based Compensation - Blac
Stock-Based Compensation - Black-Scholes-Merton option-pricing model (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | |
Risk - free interest rate (percentage) | 2.00% |
Expected term (years) | 6 years 1 month 6 days |
Expected volatility (percentage) | 42.80% |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted stock award activity (Details) - Restricted Stock Units (RSUs) shares in Thousands | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Number of Shares | |
Outstanding beginning balance | shares | 3,250 |
Granted | shares | 379 |
Vested | shares | (195) |
Forfeited | shares | (59) |
Outstanding ending balance | shares | 3,375 |
Weighted Average Grant Date Fair Value | |
Outstanding beginning balance (in dollars per share) | $ / shares | $ 24.20 |
Granted (in dollars per share) | $ / shares | 29.07 |
Vested (in dollars per share) | $ / shares | 25.72 |
Forfeited (in dollars per share) | $ / shares | 21.51 |
Outstanding ending balance (in dollars per share) | $ / shares | $ 24.70 |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock-based compensation expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based payment arrangements information | ||
Total stock-based compensation expense | $ 10,994 | $ 2,538 |
Product development | ||
Share-based payment arrangements information | ||
Total stock-based compensation expense | 3,366 | 278 |
Sales, marketing and customer support | ||
Share-based payment arrangements information | ||
Total stock-based compensation expense | 3,829 | 624 |
General and administrative | ||
Share-based payment arrangements information | ||
Total stock-based compensation expense | $ 3,799 | $ 1,636 |
Stock-Based Compensation - Empl
Stock-Based Compensation - Employee Stock Purchase Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 10,994 | $ 2,538 |
Maximum | 2021 Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 100 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - USD ($) $ in Thousands | Mar. 31, 2022 | Dec. 31, 2021 |
Accrued Liabilities, Current [Abstract] | ||
Vendor payments | $ 3,478 | $ 3,639 |
Employee commissions and bonuses | 11,019 | 13,324 |
Payroll and other employee related expense | 10,071 | 18,879 |
401k and pension expense | 565 | 1,775 |
Other taxes | 1,057 | 1,026 |
Other costs (a) | 2,813 | |
Total accrued expense | $ 26,190 | $ 41,456 |
Segment Information (Details)
Segment Information (Details) | 3 Months Ended |
Mar. 31, 2022segment | |
Segment Information | |
Number of operating segment | 1 |
Number of reportable segments | 1 |
Subsequent Events (Details)
Subsequent Events (Details) - shares shares in Thousands | May 03, 2022 | Mar. 31, 2022 |
Subsequent Event [Line Items] | ||
Options granted | 289 | |
Restricted Stock Units (RSUs) | ||
Subsequent Event [Line Items] | ||
Granted | 379 | |
Subsequent Event | 2021 Omnibus Equity Incentive Plan | Stock options | ||
Subsequent Event [Line Items] | ||
Options granted | 137 | |
Subsequent Event | 2021 Omnibus Equity Incentive Plan | Restricted Stock Units (RSUs) | ||
Subsequent Event [Line Items] | ||
Granted | 560 |