Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 08, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-40482 | |
Entity Registrant Name | TaskUs, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 83-1586636 | |
Entity Address, Address Line One | 1650 Independence Drive | |
Entity Address, Address Line Two | Suite 100 | |
Entity Address, City or Town | New Braunfels | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78132 | |
City Area Code | 888 | |
Local Phone Number | 400-8275 | |
Title of 12(b) Security | Class A Common Stock, par value $0.01 per share | |
Trading Symbol | TASK | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Entity Central Index Key | 0001829864 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Class A Common stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 27,257,480 | |
Class B Common stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding (in shares) | 70,032,694 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash | $ 61,330 | $ 107,728 |
Accounts receivable, net of allowance for doubtful accounts of $2,931 and $2,294, respectively | 157,605 | 87,782 |
Other receivables | 691 | 105 |
Prepaid expenses | 8,654 | 13,032 |
Income tax receivable | 2,232 | 1,606 |
Other current assets | 2,729 | 1,051 |
Total current assets | 233,241 | 211,304 |
Noncurrent assets: | ||
Property and equipment, net | 72,143 | 56,957 |
Deferred tax assets | 539 | 585 |
Intangibles | 226,160 | 240,295 |
Goodwill | 195,735 | 195,735 |
Other noncurrent assets | 3,714 | 2,630 |
Total noncurrent assets | 498,291 | 496,202 |
Total assets | 731,532 | 707,506 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 44,767 | 41,935 |
Accrued payroll and employee-related liabilities | 43,920 | 21,994 |
Current portion of debt | 49,822 | 45,984 |
Current portion of income tax payable | 2,152 | 0 |
Deferred revenue | 6,847 | 4,711 |
Deferred rent | 394 | 218 |
Total current liabilities | 147,902 | 114,842 |
Noncurrent liabilities: | ||
Income tax payable | 2,988 | 2,988 |
Long-term debt | 191,039 | 198,768 |
Deferred rent | 2,735 | 2,194 |
Accrued payroll and employee-related liabilities | 2,640 | 2,641 |
Deferred tax liabilities | 41,244 | 50,936 |
Total noncurrent liabilities | 240,646 | 257,527 |
Total liabilities | 388,548 | 372,369 |
Commitments and Contingencies | ||
Shareholders’ equity: | ||
Additional paid-in capital | 539,060 | 398,202 |
Accumulated deficit | (195,198) | (67,398) |
Accumulated other comprehensive income (loss) | (1,851) | 3,416 |
Total shareholders’ equity | 342,984 | 335,137 |
Total liabilities and shareholders’ equity | 731,532 | 707,506 |
Class A Common stock | ||
Shareholders’ equity: | ||
Common stock | 152 | 0 |
Class B Common stock | ||
Shareholders’ equity: | ||
Common stock | $ 821 | $ 917 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Allowance for doubtful accounts | $ 2,931 | $ 2,294 |
Class A Common stock | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 2,500,000,000 | 2,500,000,000 |
Common stock, shares issued (in shares) | 15,180,000 | 0 |
Common stock, shares outstanding (in shares) | 15,180,000 | 0 |
Class B Common stock | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock, shares issued (in shares) | 82,110,174 | 91,737,020 |
Common stock, shares outstanding (in shares) | 82,110,174 | 91,737,020 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenue from Contract with Customer, Product and Service [Extensible Enumeration] | Service [Member] | |||
Service revenue | $ 201,053 | $ 122,425 | $ 533,946 | $ 339,254 |
Operating expenses: | ||||
Cost of services | 112,423 | 65,378 | 304,251 | 191,296 |
Selling, general, and administrative expense | 60,342 | 32,190 | 269,650 | 83,630 |
Depreciation | 7,422 | 3,696 | 20,354 | 14,225 |
Amortization of intangible assets | 4,711 | 4,711 | 14,135 | 14,135 |
Loss on disposal of assets | 26 | 155 | 54 | 150 |
Contingent consideration | 0 | 0 | 0 | 3,570 |
Total operating expenses | 184,924 | 106,130 | 608,444 | 307,006 |
Operating income (loss) | 16,129 | 16,295 | (74,498) | 32,248 |
Other expense | 1,204 | 628 | 299 | 888 |
Financing expenses | 1,633 | 1,647 | 4,808 | 5,849 |
Income (loss) before income taxes | 13,292 | 14,020 | (79,605) | 25,511 |
Provision for (benefit from) income taxes | 1,656 | 2,564 | (1,805) | 4,532 |
Net income (loss) | $ 11,636 | $ 11,456 | $ (77,800) | $ 20,979 |
Net income (loss) per common share: | ||||
Basic (in usd per share) | $ 0.12 | $ 0.12 | $ (0.83) | $ 0.23 |
Diluted (in usd per share) | $ 0.11 | $ 0.12 | $ (0.83) | $ 0.23 |
Weighted-average number of common shares outstanding: | ||||
Basic (in shares) | 97,290,174 | 91,737,020 | 93,994,896 | 91,737,020 |
Diluted (in shares) | 109,426,011 | 91,737,020 | 93,994,896 | 91,737,020 |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 11,636 | $ 11,456 | $ (77,800) | $ 20,979 |
Retirement benefit reserves | 37 | 4 | 29 | 6 |
Foreign currency translation adjustments | (3,957) | 1,695 | (5,296) | 2,702 |
Comprehensive income (loss) | $ 7,716 | $ 13,155 | $ (83,067) | $ 23,687 |
Unaudited Condensed Consolida_5
Unaudited Condensed Consolidated Statements of Shareholders’ Equity - USD ($) $ in Thousands | Total | Common StockClass A Common stock | Common StockClass B Common stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive income (loss) |
Beginning balance (in shares) at Dec. 31, 2019 | 0 | 91,737,020 | ||||
Beginning balance at Dec. 31, 2019 | $ 297,500 | $ 0 | $ 917 | $ 398,202 | $ (101,931) | $ 312 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 1,515 | 1,515 | ||||
Other comprehensive income (loss) | (224) | (224) | ||||
Ending balance (in shares) at Mar. 31, 2020 | 0 | 91,737,020 | ||||
Ending balance at Mar. 31, 2020 | 298,791 | $ 0 | $ 917 | 398,202 | (100,416) | 88 |
Beginning balance (in shares) at Dec. 31, 2019 | 0 | 91,737,020 | ||||
Beginning balance at Dec. 31, 2019 | 297,500 | $ 0 | $ 917 | 398,202 | (101,931) | 312 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 20,979 | |||||
Ending balance (in shares) at Sep. 30, 2020 | 0 | 91,737,020 | ||||
Ending balance at Sep. 30, 2020 | 321,187 | $ 0 | $ 917 | 398,202 | (80,952) | 3,020 |
Beginning balance (in shares) at Mar. 31, 2020 | 0 | 91,737,020 | ||||
Beginning balance at Mar. 31, 2020 | 298,791 | $ 0 | $ 917 | 398,202 | (100,416) | 88 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 8,008 | 8,008 | ||||
Other comprehensive income (loss) | 1,233 | 1,233 | ||||
Ending balance (in shares) at Jun. 30, 2020 | 0 | 91,737,020 | ||||
Ending balance at Jun. 30, 2020 | 308,032 | $ 0 | $ 917 | 398,202 | (92,408) | 1,321 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 11,456 | 11,456 | ||||
Other comprehensive income (loss) | 1,699 | 1,699 | ||||
Ending balance (in shares) at Sep. 30, 2020 | 0 | 91,737,020 | ||||
Ending balance at Sep. 30, 2020 | 321,187 | $ 0 | $ 917 | 398,202 | (80,952) | 3,020 |
Beginning balance (in shares) at Dec. 31, 2020 | 0 | 91,737,020 | ||||
Beginning balance at Dec. 31, 2020 | 335,137 | $ 0 | $ 917 | 398,202 | (67,398) | 3,416 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 16,507 | 16,507 | ||||
Other comprehensive income (loss) | (855) | (855) | ||||
Ending balance (in shares) at Mar. 31, 2021 | 0 | 91,737,020 | ||||
Ending balance at Mar. 31, 2021 | 350,789 | $ 0 | $ 917 | 398,202 | (50,891) | 2,561 |
Beginning balance (in shares) at Dec. 31, 2020 | 0 | 91,737,020 | ||||
Beginning balance at Dec. 31, 2020 | 335,137 | $ 0 | $ 917 | 398,202 | (67,398) | 3,416 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (77,800) | |||||
Ending balance (in shares) at Sep. 30, 2021 | 15,180,000 | 82,110,174 | ||||
Ending balance at Sep. 30, 2021 | 342,984 | $ 152 | $ 821 | 539,060 | (195,198) | (1,851) |
Beginning balance (in shares) at Mar. 31, 2021 | 0 | 91,737,020 | ||||
Beginning balance at Mar. 31, 2021 | 350,789 | $ 0 | $ 917 | 398,202 | (50,891) | 2,561 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | (105,943) | (105,943) | ||||
Other comprehensive income (loss) | (492) | (492) | ||||
Issuance on Class A Common stock in the initial public offering primary offering, net of underwriters’ fees and offering costs (in shares) | 5,553,154 | |||||
Issuance on Class A Common stock in the initial public offering primary offering, net of underwriters’ fees and offering costs | 115,900 | $ 56 | 115,844 | |||
Conversion of Class B Common stock (in shares) | 9,626,846 | (9,626,846) | ||||
Conversion of Class B Common stock | 0 | $ 96 | $ (96) | |||
Stock-based compensation expense | 5,771 | 5,771 | ||||
Dividends | (50,000) | (50,000) | ||||
Ending balance (in shares) at Jun. 30, 2021 | 15,180,000 | 82,110,174 | ||||
Ending balance at Jun. 30, 2021 | 316,025 | $ 152 | $ 821 | 519,817 | (206,834) | 2,069 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 11,636 | 11,636 | ||||
Other comprehensive income (loss) | (3,920) | (3,920) | ||||
Stock-based compensation expense | 19,243 | 19,243 | ||||
Ending balance (in shares) at Sep. 30, 2021 | 15,180,000 | 82,110,174 | ||||
Ending balance at Sep. 30, 2021 | $ 342,984 | $ 152 | $ 821 | $ 539,060 | $ (195,198) | $ (1,851) |
Unaudited Condensed Consolida_6
Unaudited Condensed Consolidated Statements of Shareholders’ Equity (Parenthetical) | 3 Months Ended |
Jun. 30, 2021$ / shares | |
Statement of Stockholders' Equity [Abstract] | |
Distribution of dividends (in usd per share) | $ 0.55 |
Unaudited Condensed Consolida_7
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (77,800) | $ 20,979 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation | 20,354 | 14,220 |
Amortization of intangibles | 14,135 | 14,135 |
Amortization of debt financing fees | 387 | 343 |
Loss on disposal of assets | 54 | 150 |
Provision for losses on accounts receivable | 705 | 2,229 |
Unrealized foreign exchange losses on forward contracts | 5,831 | 1,339 |
Deferred taxes | (9,692) | (2,876) |
Stock-based compensation expense | 25,014 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (70,560) | (25,445) |
Other receivables, prepaid expenses, and other current assets | (4,753) | (10) |
Other noncurrent assets | (1,211) | (397) |
Accounts payable and accrued liabilities | 4,793 | 9,326 |
Accrued payroll and employee-related liabilities | 24,524 | 12,788 |
Income tax payable | 1,820 | (3,343) |
Deferred revenue | 2,139 | 1,722 |
Deferred rent | 834 | 469 |
Net cash provided by (used in) operating activities | (63,426) | 45,629 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (38,603) | (21,886) |
Net cash used in investing activities | (38,603) | (21,886) |
Cash flows from financing activities: | ||
Proceeds from borrowing, Revolving credit facility | 0 | 39,878 |
Payments on long-term debt | (3,938) | (1,575) |
Payments for debt financing fees | (340) | 0 |
Proceeds from issuance of common stock, net of underwriters’ fees | 120,698 | 0 |
Payments for offering costs | (4,327) | 0 |
Distribution of dividends | (50,000) | 0 |
Net cash provided by financing activities | 62,093 | 38,303 |
Increase (decrease) in cash and cash equivalents | (39,936) | 62,046 |
Effect of exchange rate changes on cash | (6,462) | 2,720 |
Cash and cash equivalents at beginning of period | 107,728 | 37,541 |
Cash and cash equivalents at end of period | $ 61,330 | $ 102,307 |
Description of Business and Org
Description of Business and Organization | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Organization | Description of Business and Organization TaskUs, Inc. (formerly known as TU TopCo, Inc.) (“TaskUs” and, together with its subsidiaries, the “Company,” “we,” “us” or “our”) was formed by investment funds affiliated with Blackstone Inc. (“Blackstone”) as a vehicle for the acquisition of TaskUs Holdings, Inc. (formerly known as TaskUs, Inc.) (“TaskUs Holdings”) on October 1, 2018 (the “Blackstone Acquisition”). Prior to the Blackstone Acquisition, TaskUs had no operations and TaskUs Holdings operated as a standalone entity. In connection with the Company’s June 2021 initial public offering (“IPO”), on June 10, 2021, the Company amended and restated its certificate of incorporation to effect a ten-for-one forward stock split of its outstanding common stock and authorized two classes of ownership interests. See Note 11, “Shareholders’ Equity” for additional information. We are a digital outsourcer focused on serving high-growth technology companies to represent, protect and grow their brands. Our global, omni-channel delivery model is focused on Digital Customer Experience, Content Security and artificial intelligence (“AI”) Operations. We have designed our platform to enable us to rapidly scale and benefit from our clients’ growth. Through our agile and responsive operational model, we deliver services from multiple delivery sites that span globally from the United States, Philippines, and other parts of the world. The Company’s major service offerings are described in more detail below: • Digital Customer Experience : Principally consists of omni-channel customer care services primarily delivered through digital (non-voice) channels. • Content Security : Principally consists of review and disposition of user and advertiser generated content for purposes which include removal or labeling of policy violating, offensive or misleading content. • AI Operation s: Principally consists of data labeling, annotation and transcription services performed for the purpose of training and tuning AI algorithms through the process of machine learning. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies (a) Basis of Presentation The accounting and reporting policies of the Company are in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). Our prospectus dated October 20, 2021 (the "prospectus"), as filed with the Securities and Exchange Commission (the “SEC”) on October 22, 2021, includes a discussion of the significant accounting policies used in the preparation of our consolidated financial statements. There were no material changes to our significant accounting policies during the nine months ended September 30, 2021. These unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with US GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by US GAAP for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2020 included in our prospectus. In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2021 and its results of operations, comprehensive income (loss) and shareholders’ equity for the three and nine months ended September 30, 2021 and 2020, and cash flows for the nine months ended September 30, 2021 and 2020. The condensed consolidated balance sheet as of December 31, 2020, was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The accompanying financial statements and related notes to the financial statements give retroactive effect to the stock split for all periods presented. See Note 11, “Shareholders’ Equity” for additional information. (b) Use of Estimates The preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the determination of useful lives and impairment of fixed assets; allowances for doubtful accounts and other receivables; the valuation of deferred tax assets; valuation of forward contracts receivable; valuation of stock-based compensation; valuation and impairment of intangibles and goodwill and reserves for income tax uncertainties and other contingencies. As of September 30, 2021, the impact of the novel coronavirus (“COVID-19”) pandemic, including as a result of new strains and variants of the virus and uncertainty of acceptance of vaccines and their effectiveness, continues to unfold. As a result, many of our estimates and assumptions required increased judgement and carry a higher degree of variability and volatility. We continue to closely monitor the outbreak and the impact on our operations and liquidity. As events continue to evolve and additional information becomes available, our estimates may change materially in the future. (c) Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The Company has no involvement with variable interest entities. (d) Concentration Risk Most of the Company’s customers are located in the United States. Customers outside of the United States are concentrated in Europe and Canada. For the three and nine months ended September 30, 2021 and 2020, the following customers represented greater than 10% of the Company’s service revenue: Customer Service revenue percentage Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 A 27 % 33 % 27 % 33 % B 11 % 11 % 11 % 13 % As of September 30, 2021 and December 31, 2020, the following customers represented greater than 10% of the Company’s accounts receivable: Accounts receivable percentage Customer September 30, 2021 December 31, 2020 A 26 % 22 % B 13 % 16 % The Company’s principal operations, including the majority of its employees and the fixed assets owned by its wholly owned subsidiaries, are located in the Philippines. (e) Recent Accounting Pronouncements The Company currently qualifies as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Accordingly, the Company is provided the option to adopt new or revised accounting guidance either (i) within the same periods as those otherwise applicable to non-emerging growth companies or (ii) within the same time periods as private companies. The Company has elected to adopt new or revised accounting guidance within the same time period as private companies. Recently adopted accounting pronouncements In December 2019, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 was issued as a means to reduce the complexity of accounting for income taxes for those entities that fall within the scope of the accounting standard. The guidance is to be applied using a prospective method, excluding amendments related to franchise taxes, which should be applied on either a retrospective basis for all periods presented or a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company adopted this standard in the first quarter of 2021; the adoption did not have a material impact on its consolidated financial statements. Recently issued accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes FASB Accounting Standards Codification ("ASC"), Leases (Topic 840). The standard is intended to increase the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. In June 2020, the FASB postponed the effective date for ASC 842 for private companies. This ASU will be effective for the Company beginning in fiscal year 2022, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2016-02 on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The revised standard relates to measurement of credit losses on financial instruments, and requires financial assets measured at amortized cost to be presented at the net amount expected to be collected. The guidance replaces the incurred loss model with an expected loss model referred to as current expected credit loss ("CECL"). The CECL model requires us to measure lifetime expected credit losses for financial instruments held at the reporting date using historical experience, current conditions and reasonable supportable forecasts. The guidance expands the disclosure requirements regarding an entity’s assumptions, models, and methods for estimating credit losses and requires new disclosures of the amortized cost balance for each class of financial asset by credit quality indicator, disaggregated by the year of origination. This ASU will be effective for the Company beginning in fiscal year 2023 with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2016-13 on the Company’s consolidated financial statements. In August 2018, The FASB issued ASU 2018-15, Intangibles — Goodwill and Other —Internal-Use Software (Subtopic 350-40). The standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The amendments in this ASU require (i) costs for implementation activities to be capitalized in the statement of financial position in the same line item that a prepayment for the fees of the associated hosting arrangement would be presented, (ii) expense related to the capitalized implementation costs be presented in the same line item in the statement of income as the fees associated with the hosting element (service) of the arrangement and (iii) payments for capitalized implementation costs be presented in the statement of cash flows in the same manner as payments made for fees associated with the hosting element. The guidance should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company intends to adopt this standard, on a prospective basis, for the fiscal year ending December 31, 2021 and interim periods during the fiscal year ending December 31, 2022. The Company is currently evaluating the impact of adopting ASU 2018-15 on the Company's consolidated financial statements. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of Revenue Our revenues are derived from contracts with customers related to business outsourcing services that we provide. The following table presents the breakdown of the Company’s revenues by service offering: Three months ended September 30, Nine months ended September 30, (in thousands) 2021 2020 2021 2020 Digital Customer Experience $ 125,310 $ 76,255 $ 338,587 $ 212,817 Content Security 45,376 33,787 124,498 91,401 AI Operations 30,367 12,383 70,861 35,036 Service revenue $ 201,053 $ 122,425 $ 533,946 $ 339,254 The majority of the Company’s revenues are derived from contracts with customers who are located in the United States. However, we deliver our services from geographies outside of the United States. The following table presents the breakdown of the Company’s revenues by geographical location, based on where the services are provided from: Three months ended September 30, Nine months ended September 30, (in thousands) 2021 2020 2021 2020 Philippines $ 103,837 $ 69,369 $ 284,096 $ 188,085 United States 65,866 42,761 175,553 126,835 Rest of World 31,350 10,295 74,297 24,334 Service revenue $ 201,053 $ 122,425 $ 533,946 $ 339,254 Contract Balances Accounts receivable, net of allowance for doubtful accounts includes $67.6 million and $47.4 million of unbilled revenues as of September 30, 2021 and December 31, 2020, respectively. |
Forward Contract
Forward Contract | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Forward Contract | Forward Contracts The Company transacts business in various foreign currencies and has international sales and expenses denominated in foreign currencies, subjecting the Company to foreign currency exchange rate risk. During 2021 and 2020, the Company entered into foreign currency exchange rate forward contracts, with a commercial bank as the counterparty, with maturities of generally 12 months or less, to reduce the volatility of cash flows primarily related to forecasted costs denominated in Philippine pesos. In addition, the Company utilizes foreign currency exchange rate contracts to mitigate foreign currency exchange rate risk associated with foreign currency-denominated assets and liabilities, primarily intercompany balances. The Company does not use foreign currency exchange rate contracts for trading purposes. The exchange rate forward contracts entered into by the Company are not designated as hedging instruments. Any gains or losses resulting from changes in the fair value of these contracts are recognized in other expense in the consolidated statements of operations. For the three months ended September 30, 2021 and 2020, the Company settled forward contracts with total notional amounts of approximately $31.8 million and $26.0 million, respectively, and for the nine months ended September 30, 2021 and 2020, the Company settled forward contracts with total notional amounts of approximately $77.4 million and $62.0 million, respectively. For the three months ended September 30, 2021 and 2020, realized losses (gains) of approximately $0.7 million and $(1.9) million, respectively, resulting from the settlement of forward contracts were included within other expense. For the nine months ended September 30, 2021 and 2020, realized gains of approximately $0.6 million and $3.5 million, respectively, resulting from the settlement of forward contracts were included within other expense. As of September 30, 2021 and December 31, 2020, the Company had outstanding forward contracts with notional amounts of approximately $116.6 million and $109.2 million, respectively. The forward contract receivable (payable) resulting from changes in fair value was recorded under prepaid expenses (accounts payable and accrued liabilities). For the three months ended September 30, 2021 and 2020, the unrealized losses on the forward contracts of $4.1 million and $1.2 million, respectively, were included within other expense. For the nine months ended September 30, 2021 and 2020, the unrealized losses on the forward contracts of $5.8 million and $1.3 million, respectively, were included within other expense. By entering into derivative contracts, the Company is exposed to counterparty credit risk, or the failure of the counterparty to perform under the terms of the derivative contract. For the periods presented, the non-performance risk of the Company and the counterparties did not have a material impact on the fair value of the derivative instruments. The Company has implemented the fair value accounting standard for those assets and liabilities that are re-measured and reported at fair value at each reporting period. This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value based on inputs used, and requires additional disclosures about fair value measurements. This standard applies to fair value measurements already required or permitted by existing standards. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset and include situations where there is little, if any, market activity for the asset. The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 2021 and December 31, 2020 and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value: Fair value measurements using (in thousands) September 30, Level 1 Level 2 Level 3 Forward contracts payable $ 4,051 $ — $ 4,051 $ — Fair value measurements using (in thousands) December 31, Level 1 Level 2 Level 3 Forward contracts receivable $ 1,780 $ — $ 1,780 $ — The Company’s derivatives are carried at fair value using various pricing models that incorporate observable market inputs, such as interest rate yield curves and currency rates, which are Level 2 inputs. Derivative valuations incorporate credit risk adjustments that are necessary to reflect the probability of default by the counterparty or by the Company. |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and Equipment, net The components of property and equipment, net as of September 30, 2021 and December 31, 2020 were as follows: (in thousands) September 30, December 31, Leasehold improvements $ 32,902 $ 31,654 Technology and computers 68,589 47,572 Furniture and fixtures 4,000 4,203 Construction in process 14,480 5,194 Other property and equipment 7,059 5,995 Property and equipment, gross 127,030 94,618 Accumulated depreciation (54,887) (37,661) Property and equipment, net $ 72,143 $ 56,957 The Company’s principal operations are in the Philippines where the majority of property and equipment resides under its wholly owned subsidiaries. The table below presents the Company’s total property and equipment by geographic location as of September 30, 2021 and December 31, 2020: (in thousands) September 30, December 31, Philippines $ 44,432 $ 37,823 United States 11,077 8,983 Rest of World 16,634 10,151 Property and equipment, net $ 72,143 $ 56,957 |
Goodwill and Intangibles
Goodwill and Intangibles | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles | Goodwill and Intangibles The carrying amount of goodwill as of September 30, 2021 and December 31, 2020 was $195.7 million. The components of intangible assets as of September 30, 2021 and December 31, 2020 were as follows: September 30, 2021 December 31, 2020 (in thousands) Life Intangibles, Accumulated Intangibles, Intangibles, Accumulated Intangibles, Customer relationships 15 $ 240,800 $ (48,161) $ 192,639 $ 240,800 $ (36,121) $ 204,679 Trade name 15 41,900 (8,379) 33,521 41,900 (6,284) 35,616 Total $ 282,700 $ (56,540) $ 226,160 $ 282,700 $ (42,405) $ 240,295 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-Term Debt The balances of current and non-current portions of debt consist of the following as of September 30, 2021: (in thousands) Current Noncurrent Total Term Loan $ 10,500 $ 192,150 $ 202,650 Revolver 39,878 — 39,878 Less: Debt financing fees (556) (1,111) (1,667) Total $ 49,822 $ 191,039 $ 240,861 2019 Credit Agreement On September 25, 2019, the Company entered into a credit agreement (the “2019 Credit Agreement”) that included a $210.0 million term loan (the “Term Loan Facility”) and a $40.0 million revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan Facility, the “2019 Credit Facilities”). On April 30, 2021, the Company entered into Amendment No. 1 to its 2019 Credit Agreement with the existing lenders providing for $50.0 million incremental revolving credit commitments on the same terms as our existing revolving credit facility. We accounted for this amendment as a debt modification and recorded $0.3 million of debt financing fees which will be amortized, along with previously deferred fees, over the remaining term of the Revolving Credit Facility. Principal payments on the Term Loan Facility are due quarterly in arrears equal to installments in an aggregate annual amount equal to (i) 1.0% per annum of the original principal amount in the first year, (ii) 2.5% per annum of the original principal amount in the second year, (iii) 5.0% per annum of the original principal amount in the third year, (iv) 7.5% per annum of the original principal amount in the fourth year and (v) 10.0% per annum of the original principal amount in the fifth year, with the remaining principal due in a lump sum at the maturity date of September 25, 2024. The interest rate in effect with respect to the Term Loan Facility as of September 30, 2021 was 2.334% per annum. The Revolving Credit Facility provides the Company with access to a $15.0 million letter of credit facility and a $5.0 million swing line facility, each of which, to the extent used, reduces borrowing availability under the Revolving Credit Facility. The Revolving Credit Facility expires on September 25, 2024, and requires a commitment fee of 0.4% on undrawn commitments paid quarterly in arrears. As of September 30, 2021, the interest rate in effect was 2.334% on outstanding borrowings under the Revolving Credit Facility. As of September 30, 2021, we had $50.1 million of borrowing availability under the Revolving Credit Facility. The 2019 Credit Agreement contains certain restrictive financial covenants and also limits additional borrowings, capital expenditures, and distributions. The Company was in compliance with these covenants as of September 30, 2021. Substantially all assets of the Company's direct wholly owned subsidiary TU Midco, Inc. and its material domestic subsidiaries are pledged as collateral under this agreement, subject to certain customary exceptions. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and ContingenciesFrom time to time, the Company may become subject to legal proceedings, claims, and litigation arising in the ordinary course of business. The Company is not currently a party to any material legal proceedings, nor is the Company aware of any pending or threatened litigation that would have a material adverse effect on the Company’s business, operating results, cash flows, or financial condition should such litigation be resolved unfavorably. |
Employee Compensation
Employee Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Employee Compensation | Employee Compensation Phantom Stock Plan On June 19, 2015, TaskUs Holdings’ board of directors officially adopted a company-wide phantom stock plan and related phantom share agreements. There were 6,514,360 outstanding phantom shares as of December 31, 2020. There were 1,399,470 phantom shares forfeited during the nine months ended September 30, 2021. Because the change in control became probable upon the IPO, the Company recognized expense in the amount of the cash settlement totaling $127.5 million recorded in selling, general, and administrative expense on the condensed consolidated statements of operations for the nine months ended September 30, 2021. As of September 30, 2021 there were no phantom shares outstanding. 2019 Stock Incentive Plan On April 16, 2019, the Company established an equity incentive plan pursuant to which the Company has granted option awards to selected executives and other key employees (the “2019 Plan”). The stock options contain service, market and performance conditions. Stock options under this plan contingently vest over a period of two years in the event of a change in control and over a period of three years in the event of an IPO (each as defined in such plan), with the vesting period beginning on the date of the performance event so long as the holder remains employed. The amount of options eligible for vesting is contingent upon Blackstone’s return on invested capital in the Company. These options have contractual lives of 10 years. Following the IPO and establishment of the Company's 2021 Omnibus Incentive Plan (the “2021 Plan”) as further discussed below, it is not expected that any additional awards will be issued under the 2019 Plan. At the date of the IPO, the Company concluded that the public offering represented a qualifying liquidity event that would cause the stock option’s performance condition to be probable of occurring. As such, the Company has begun to recognize compensation expense in relation to the stock options issued under the 2019 Plan. 2021 Omnibus Incentive Plan In connection with the IPO, the Company adopted the 2021 Plan, which provides for the issuance of non-qualified stock options, incentive stock options, stock appreciation rights (“SARs”), restricted shares of Class A common stock, restricted stock units (“RSUs”), or other equity-based or cash-based awards. The Company initially granted 6,614,122 awards to its founders and reserved an additional 12,160,929 shares of Class A common stock for issuance under the 2021 Plan, subject to automatic annual evergreen increases. Stock Options During the nine months ended September 30, 2021, the Company granted 2,265,146 stock options to its founders and certain officers and employees with a weighted-average grant date fair value of $9.34. The stock options are subject to service-based vesting conditions and generally vest quarterly or annually over four years and expire 10 years from the date of the grant. The grant date fair value of the stock options was estimated using the Black-Scholes option pricing method with the following assumptions: Dividend yield (%) 0 % Expected volatility (%) 32-35% Risk-free interest rate (%) 0.8-1.3% Expected term (years) 5.1-7.0 As of September 30, 2021, there were 9,744,028 stock options outstanding with a weighted-average exercise price of $10.06 per share. As of September 30, 2021, there was $22.3 million of unrecognized compensation expense related to the Company’s unvested stock options that is expected to be recognized over a weighted-average period of 2.4 years. RSUs During the nine months ended September 30, 2021, the Company granted 4,277,543 RSUs to its founders and certain officers and employees with a weighted-average grant date fair value of $27.23. The RSUs are typically subject to service-based vesting conditions and generally vest quarterly or annually over four years. As of September 30, 2021, there was $98.9 million of unrecognized compensation expense related to the Company’s unvested RSUs that is expected to be recognized over a weighted-average period of 2.4 years. PSUs During the nine months ended September 30, 2021, the Company granted 3,373,417 PSUs to its founders a certain officer with a weighted-average grant date fair value of $4.02. The majority of the PSUs vest contingently in annual installments over four years subject to continued service and the achievement of certain enterprise value compound annual growth rate ("CAGR") targets. The remaining PSUs vest contingently in four years subject to continued service and the achievement of certain market capitalization CAGR targets. The grant date fair value of the PSUs were estimated using the Monte Carlo simulation method with the following assumptions: Dividend yield (%) 0 % Expected volatility (%) 40 % Risk-free interest rate (%) 0.1-0.6 % As of September 30, 2021, there was $11.7 million of unrecognized compensation expense related to the Company’s unvested PSUs that is expected to be recognized over a weighted-average period of 2.7 years. Stock-Based Compensation Expense We recognize stock-based compensation expense for all awards using a graded vesting method. The following table summarizes the components of stock-based compensation expense recognized for the periods presented: Three months ended September 30, Nine months ended September 30, (in thousands) 2021 2020 2021 2020 Cost of services $ 451 $ — $ 502 $ — Selling, general, and administrative expense 18,792 — 152,008 — Total $ 19,243 $ — $ 152,510 $ — |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In determining its interim provision for income taxes, the Company used an estimated annual effective tax rate, which is based on expected income before taxes, statutory tax rates and tax planning opportunities available in the various jurisdictions in which the Company operates. Certain significant or unusual items are separately recognized in the period in which they occur and can be a source of variability in the effective tax rate from quarter to quarter. The Company recorded provision for income taxes of $1.7 million and $2.6 million in the three months ended September 30, 2021 and 2020, respectively. The effective tax rate was 12.5% and 18.3% for the three months ended September 30, 2021 and 2020, respectively. The Company recorded provision for (benefit from) income taxes of $(1.8) million and $4.5 million in the nine months ended September 30, 2021 and 2020, respectively. The effective tax rate was 2.3% and 17.8% for the nine months ended September 30, 2021 and 2020. The difference between the effective tax rates and the 21% federal statutory rate in the nine months ended September 30, 2021 was primarily due to global intangible low-taxed income (“GILTI”) inclusion, tax benefits of income tax holidays in foreign jurisdiction, nondeductible transaction costs and nondeductible compensation of officers. The difference between the effective tax rates and the 21% federal statutory rate in the nine months ended September 30, 2020 was primarily due to GILTI inclusion, foreign-derived intangible income ("FDII") deduction and tax benefits of income tax holidays in foreign jurisdiction. The Company is subject to income tax in the United States federal, state and various foreign jurisdictions. Federal income tax returns of the Company are subject to IRS examination for the 2017 through 2019 tax years. State income tax returns are subject to examination for the 2017 through 2019 tax years. The Company’s practice and intention are to indefinitely reinvest the earnings of its non-U.S. subsidiaries. Determination of the amount of any unrecognized deferred income tax liability on the temporary difference is not practicable because of the complexities of the hypothetical calculation. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Dividend Distribution On April 9, 2021, prior to the IPO, the Company's board of directors declared a cash dividend in the aggregate amount of $50.0 million to holders of our common stock. The cash dividend was paid on April 16, 2021. Amendment and Restatement of Certificate of Incorporation On June 10, 2021, the Company amended and restated its certificate of incorporation to effect a ten-for-one forward stock split of its outstanding common stock and authorized three classes of ownership interests: (i) 250,000,000 shares of Preferred Stock, par value $0.01 per share; (ii) 2,500,000,000 shares of Class A common stock, par value $0.01 per share; and (iii) 250,000,000 shares of Class B common stock, par value $0.01 per share. After giving effect to the ten-for-one stock split, all outstanding shares of common stock were reclassified into an equal number of shares of Class B common stock (the “Class B Reclassification”) and the selling shareholders participated equally in the Class B Reclassification. The rights of the holders of Class A common stock and Class B common stock are identical, except with respect to voting, transfer and conversion rights. Each share of Class A common stock is entitled to one vote per share. Each share of Class B common stock is entitled to ten votes per share and is convertible into one share of Class A common stock at any time or automatically upon certain conditions but no later than June 10, 2028 (seven years following the filing and effectiveness of the amended and restated certificate of incorporation). Initial Public Offering On June 15, 2021, the Company closed its IPO of 5,553,154 shares of Class A common stock (the “primary” offering) and selling stockholders sold 9,626,846 shares (the “secondary” offering), including shares sold by the selling stockholders pursuant to the underwriters’ full exercise of their option to purchase additional shares, at a public offering price of $23 per share. The Company received net proceeds of $120.7 million after deducting underwriting discounts and commissions, but before deducting offering expenses. The Company used the proceeds from the primary offering, together with cash on hand, to satisfy payments of approximately $127.5 million in respect of vested phantom shares in the third quarter of 2021. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Following the effectiveness of the amended and restated certificate of incorporation, the Class B Reclassification and the IPO, the Company has Class A common stock and Class B common stock outstanding. Because the only difference between the two classes of common stock are related to voting, transfer and conversion rights, the Company has not presented earnings per share under the two-class method, as earnings per share are the same for both Class A common stock and Class B common stock. The accompanying financial statements and related notes to the financial statements give retroactive effect to the stock split for all periods presented. See Note 11, “Shareholders’ Equity” for additional information. The computation of basic net income (loss) per share (“EPS”) is based on the weighted-average number of shares that were outstanding during the period, including shares of common stock that are issuable at the end of the reporting period. The computation of diluted EPS is based on the number of basic weighted-average shares outstanding plus the number of common shares that would be issued assuming the exercise of all potentially dilutive common stock equivalents. Common stock equivalents consist of shares issuable upon the exercise of stock options and vesting of RSUs and PSUs. The following table summarizes the computation of basic and diluted EPS for the three and nine months ended September 30, 2021 and 2020: Three months ended September 30, Nine months ended September 30, (in thousands,except share and per share data) 2021 2020 2021 2020 Numerator: Net income (loss) available to common shareholders $ 11,636 $ 11,456 $ (77,800) $ 20,979 Denominator: Weighted-average common shares outstanding – basic 97,290,174 91,737,020 93,994,896 91,737,020 Effect of dilutive securities 12,135,837 — — — Weighted-average common shares outstanding – diluted 109,426,011 91,737,020 93,994,896 91,737,020 Net income (loss) per common share: Basic $ 0.12 $ 0.12 $ (0.83) $ 0.23 Diluted $ 0.11 $ 0.12 $ (0.83) $ 0.23 Since the Company was in a net loss position for the nine months ended September 30, 2021, diluted EPS is equal to basic EPS for that period as the inclusion of potential common stock equivalents would have been anti-dilutive. The Company excluded 12,309 and 23,607 potential common stock equivalents from the computation of diluted EPS for the three and nine months ended September 30, 2021, respectively, because the effect would have been anti-dilutive. In addition, the Company excluded 5,578,525 potential common stock equivalents from the computation of diluted EPS for the nine months ended September 30, 2021 since the Company was in a net loss position; however, these awards would have been dilutive if the Company was in a net income position. |
Related Party
Related Party | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
Related Party | Related Party On October 1, 2018, Bidco acquired 100% of the outstanding shares of TaskUs Holdings at a purchase price of $429.4 million (the “Transaction”). As a part of the Transaction, the Company entered into a Stock Purchase Agreement, which provides that the sellers of TaskUs Holdings are entitled to receive cash payments for certain tax benefits, if any, realized as a result of the Blackstone Acquisition that are received by the Company for a specified period after the closing date. The Company recognized expense of $3.6 million for the expected payment to the sellers during the nine months ended September 30, 2020. The Company made payment to the sellers during the nine months ended September 30, 2021. In connection with the closing of the Blackstone Acquisition, TaskUs and TaskUs Holdings entered into a support and services agreement (the “Support and Services Agreement”) with Blackstone Capital Partners VII L.P. and Blackstone Capital Partners Asia L.P. and Blackstone Management Partners L.L.C. (“BMP”), an affiliate of Blackstone. Under the Support and Services Agreement, we reimburse BMP and its affiliates for expenses related to support services customarily provided by Blackstone’s portfolio operations group to Blackstone’s portfolio companies, as well as healthcare-related services provided by Blackstone’s Equity Healthcare group and Blackstone’s group purchasing program. The Support and Services Agreement also requires us to, among other things, make certain information available to Blackstone and to indemnify BMP and its affiliates against certain claims. During the three and nine months ended September 30, 2020, the Company made payments of $0.2 million and $0.2 million, respectively, pursuant to the Support and Services Agreement. From time to time, the Company does business with a number of other companies affiliated with Blackstone, which cannot be presumed to be carried out at an arm’s-length basis. During the periods presented, Blackstone had an interest in Alight, Inc. (“Alight”), Custom Ink and Mphasis Limited (“Mphasis”), entities that supply TaskUs with certain consulting services and promotional items. During the three and nine months ended September 30, 2021, the Company made payments of $0.4 million and $0.9 million, respectively, to Alight. During the nine months ended September 30, 2021, the Company made payments of $0.2 million to Custom Ink. During the nine months ended September 30, 2020, the Company made payments of $0.2 million to Mphasis. During the periods presented, Blackstone had an interest in Vivint Smart Home, Inc. (“Vivint”), North American Bancard, and Custom Ink, entities that are TaskUs customers. During the three months ended September 30, 2021, the Company received payments of $0.6 million, $0.7 million, and $0.8 million from Vivint, North American Bancard and Custom Ink, respectively. During the nine months ended September 30, 2021, the Company received payments of $1.5 million, $1.3 million, and $1.5 million from Vivint, North American Bancard and Custom Ink, respectively. Similarly, from time to time, the Company does business with entities affiliated with members of our Board of Directors, which cannot be presumed to be carried out at an arm’s length basis. A management consulting firm affiliated with a member of our Board of Directors provides consulting services to the Company. During the three months ended September 30, 2021 and 2020, the Company incurred fees related to consulting services provided by this consulting firm of $0.1 million and $0.1 million, respectively. During the nine months ended September 30, 2021 and 2020, the Company incurred fees related to consulting services provided by this consulting of $0.2 million and $0.2 million, respectively. Underwriting of IPO Blackstone Securities Partners L.P., an affiliate of Blackstone, served as underwriter of 1,380,000 of the 15,180,000 shares of Class A common stock sold in the IPO, with underwriting discounts and commissions of $1.265 per share paid by the Company and selling stockholders. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsOn October 25, 2021, certain of the Company's stockholders completed a secondary offering of 12,077,480 shares of the Company's Class A common stock at a public offering price of $63.50 per share. All of the shares of Class A common stock were offered by existing stockholders. The Company did not sell any common stock in the offering and did not receive any proceeds from the offering. Blackstone Securities Partners L.P., an affiliate of Blackstone, served as underwriter of 1,021,942 of the 12,077,480 shares of Class A common stock sold in the offering, with underwriting discounts and commissions of $2.06375 per share paid by the selling stockholders. The underwriters have the option to purchase up to an additional 1,811,622 shares of the Company's Class A common stock from the selling stockholders at the public offering price less the underwriting discounts and commissions, within 30 days from October 20, 2021. If any shares are purchased pursuant to this option, the underwriters will severally purchase shares in approximately the same proportion as set forth in the prospectus for the secondary offering. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accounting and reporting policies of the Company are in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). Our prospectus dated October 20, 2021 (the "prospectus"), as filed with the Securities and Exchange Commission (the “SEC”) on October 22, 2021, includes a discussion of the significant accounting policies used in the preparation of our consolidated financial statements. There were no material changes to our significant accounting policies during the nine months ended September 30, 2021. These unaudited condensed consolidated financial statements and accompanying notes have been prepared in accordance with US GAAP for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by US GAAP for complete financial statements and should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2020 included in our prospectus. In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of its financial position as of September 30, 2021 and its results of operations, comprehensive income (loss) and shareholders’ equity for the three and nine months ended September 30, 2021 and 2020, and cash flows for the nine months ended September 30, 2021 and 2020. The condensed consolidated balance sheet as of December 31, 2020, was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. |
Use of Estimates | Use of EstimatesThe preparation of consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include the determination of useful lives and impairment of fixed assets; allowances for doubtful accounts and other receivables; the valuation of deferred tax assets; valuation of forward contracts receivable; valuation of stock-based compensation; valuation and impairment of intangibles and goodwill and reserves for income tax uncertainties and other contingencies. As of September 30, 2021, the impact of the novel coronavirus (“COVID-19”) pandemic, including as a result of new strains and variants of the virus and uncertainty of acceptance of vaccines and their effectiveness, continues to unfold. As a result, many of our estimates and assumptions required increased judgement and carry a higher degree of variability and volatility. We continue to closely monitor the outbreak and the impact on our operations and liquidity. As events continue to evolve and additional information becomes available, our estimates may change materially in the future. |
Principles of Consolidation | Principles of ConsolidationThe accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The Company has no involvement with variable interest entities. |
Concentration Risk | Concentration RiskMost of the Company’s customers are located in the United States. Customers outside of the United States are concentrated in Europe and Canada.The Company’s principal operations, including the majority of its employees and the fixed assets owned by its wholly owned subsidiaries, are located in the Philippines. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company currently qualifies as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Accordingly, the Company is provided the option to adopt new or revised accounting guidance either (i) within the same periods as those otherwise applicable to non-emerging growth companies or (ii) within the same time periods as private companies. The Company has elected to adopt new or revised accounting guidance within the same time period as private companies. Recently adopted accounting pronouncements In December 2019, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU 2019-12 was issued as a means to reduce the complexity of accounting for income taxes for those entities that fall within the scope of the accounting standard. The guidance is to be applied using a prospective method, excluding amendments related to franchise taxes, which should be applied on either a retrospective basis for all periods presented or a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company adopted this standard in the first quarter of 2021; the adoption did not have a material impact on its consolidated financial statements. Recently issued accounting pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes FASB Accounting Standards Codification ("ASC"), Leases (Topic 840). The standard is intended to increase the transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. In June 2020, the FASB postponed the effective date for ASC 842 for private companies. This ASU will be effective for the Company beginning in fiscal year 2022, with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2016-02 on the Company’s consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The revised standard relates to measurement of credit losses on financial instruments, and requires financial assets measured at amortized cost to be presented at the net amount expected to be collected. The guidance replaces the incurred loss model with an expected loss model referred to as current expected credit loss ("CECL"). The CECL model requires us to measure lifetime expected credit losses for financial instruments held at the reporting date using historical experience, current conditions and reasonable supportable forecasts. The guidance expands the disclosure requirements regarding an entity’s assumptions, models, and methods for estimating credit losses and requires new disclosures of the amortized cost balance for each class of financial asset by credit quality indicator, disaggregated by the year of origination. This ASU will be effective for the Company beginning in fiscal year 2023 with early adoption permitted. The Company is currently evaluating the impact of adopting ASU 2016-13 on the Company’s consolidated financial statements. In August 2018, The FASB issued ASU 2018-15, Intangibles — Goodwill and Other —Internal-Use Software (Subtopic 350-40). The standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The amendments in this ASU require (i) costs for implementation activities to be capitalized in the statement of financial position in the same line item that a prepayment for the fees of the associated hosting arrangement would be presented, (ii) expense related to the capitalized implementation costs be presented in the same line item in the statement of income as the fees associated with the hosting element (service) of the arrangement and (iii) payments for capitalized implementation costs be presented in the statement of cash flows in the same manner as payments made for fees associated with the hosting element. The guidance should be applied either retrospectively or prospectively to all implementation costs incurred after the date of adoption. The Company intends to adopt this standard, on a prospective basis, for the fiscal year ending December 31, 2021 and interim periods during the fiscal year ending December 31, 2022. The Company is currently evaluating the impact of adopting ASU 2018-15 on the Company's consolidated financial statements. |
Forward Contracts | The Company transacts business in various foreign currencies and has international sales and expenses denominated in foreign currencies, subjecting the Company to foreign currency exchange rate risk. During 2021 and 2020, the Company entered into foreign currency exchange rate forward contracts, with a commercial bank as the counterparty, with maturities of generally 12 months or less, to reduce the volatility of cash flows primarily related to forecasted costs denominated in Philippine pesos. In addition, the Company utilizes foreign currency exchange rate contracts to mitigate foreign currency exchange rate risk associated with foreign currency-denominated assets and liabilities, primarily intercompany balances. The Company does not use foreign currency exchange rate contracts for trading purposes. The exchange rate forward contracts entered into by the Company are not designated as hedging instruments. Any gains or losses resulting from changes in the fair value of these contracts are recognized in other expense in the consolidated statements of operations. By entering into derivative contracts, the Company is exposed to counterparty credit risk, or the failure of the counterparty to perform under the terms of the derivative contract. For the periods presented, the non-performance risk of the Company and the counterparties did not have a material impact on the fair value of the derivative instruments. The Company has implemented the fair value accounting standard for those assets and liabilities that are re-measured and reported at fair value at each reporting period. This standard establishes a single authoritative definition of fair value, sets out a framework for measuring fair value based on inputs used, and requires additional disclosures about fair value measurements. This standard applies to fair value measurements already required or permitted by existing standards. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets. Fair values determined by Level 2 inputs utilize data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are unobservable data points for the asset and include situations where there is little, if any, market activity for the asset. |
Earnings (Loss) Per Share | The computation of basic net income (loss) per share (“EPS”) is based on the weighted-average number of shares that were outstanding during the period, including shares of common stock that are issuable at the end of the reporting period. The computation of diluted EPS is based on the number of basic weighted-average shares outstanding plus the number of common shares that would be issued assuming the exercise of all potentially dilutive common stock equivalents. Common stock equivalents consist of shares issuable upon the exercise of stock options and vesting of RSUs and PSUs. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Concentration Risk | For the three and nine months ended September 30, 2021 and 2020, the following customers represented greater than 10% of the Company’s service revenue: Customer Service revenue percentage Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 A 27 % 33 % 27 % 33 % B 11 % 11 % 11 % 13 % As of September 30, 2021 and December 31, 2020, the following customers represented greater than 10% of the Company’s accounts receivable: Accounts receivable percentage Customer September 30, 2021 December 31, 2020 A 26 % 22 % B 13 % 16 % |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue by Service | The following table presents the breakdown of the Company’s revenues by service offering: Three months ended September 30, Nine months ended September 30, (in thousands) 2021 2020 2021 2020 Digital Customer Experience $ 125,310 $ 76,255 $ 338,587 $ 212,817 Content Security 45,376 33,787 124,498 91,401 AI Operations 30,367 12,383 70,861 35,036 Service revenue $ 201,053 $ 122,425 $ 533,946 $ 339,254 |
Schedule of Revenue by Geographic Area | The following table presents the breakdown of the Company’s revenues by geographical location, based on where the services are provided from: Three months ended September 30, Nine months ended September 30, (in thousands) 2021 2020 2021 2020 Philippines $ 103,837 $ 69,369 $ 284,096 $ 188,085 United States 65,866 42,761 175,553 126,835 Rest of World 31,350 10,295 74,297 24,334 Service revenue $ 201,053 $ 122,425 $ 533,946 $ 339,254 |
Forward Contract (Tables)
Forward Contract (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Fair Value of Assets Measured on a Recurring Basis | The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 2021 and December 31, 2020 and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value: Fair value measurements using (in thousands) September 30, Level 1 Level 2 Level 3 Forward contracts payable $ 4,051 $ — $ 4,051 $ — Fair value measurements using (in thousands) December 31, Level 1 Level 2 Level 3 Forward contracts receivable $ 1,780 $ — $ 1,780 $ — |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | The components of property and equipment, net as of September 30, 2021 and December 31, 2020 were as follows: (in thousands) September 30, December 31, Leasehold improvements $ 32,902 $ 31,654 Technology and computers 68,589 47,572 Furniture and fixtures 4,000 4,203 Construction in process 14,480 5,194 Other property and equipment 7,059 5,995 Property and equipment, gross 127,030 94,618 Accumulated depreciation (54,887) (37,661) Property and equipment, net $ 72,143 $ 56,957 |
Summary of Property and Equipment by Geographic Areas | The table below presents the Company’s total property and equipment by geographic location as of September 30, 2021 and December 31, 2020: (in thousands) September 30, December 31, Philippines $ 44,432 $ 37,823 United States 11,077 8,983 Rest of World 16,634 10,151 Property and equipment, net $ 72,143 $ 56,957 |
Goodwill and Intangibles (Table
Goodwill and Intangibles (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | The components of intangible assets as of September 30, 2021 and December 31, 2020 were as follows: September 30, 2021 December 31, 2020 (in thousands) Life Intangibles, Accumulated Intangibles, Intangibles, Accumulated Intangibles, Customer relationships 15 $ 240,800 $ (48,161) $ 192,639 $ 240,800 $ (36,121) $ 204,679 Trade name 15 41,900 (8,379) 33,521 41,900 (6,284) 35,616 Total $ 282,700 $ (56,540) $ 226,160 $ 282,700 $ (42,405) $ 240,295 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Summary of Current and Non-Current Debt | The balances of current and non-current portions of debt consist of the following as of September 30, 2021: (in thousands) Current Noncurrent Total Term Loan $ 10,500 $ 192,150 $ 202,650 Revolver 39,878 — 39,878 Less: Debt financing fees (556) (1,111) (1,667) Total $ 49,822 $ 191,039 $ 240,861 |
Employee Compensation (Tables)
Employee Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The grant date fair value of the stock options was estimated using the Black-Scholes option pricing method with the following assumptions: Dividend yield (%) 0 % Expected volatility (%) 32-35% Risk-free interest rate (%) 0.8-1.3% Expected term (years) 5.1-7.0 Dividend yield (%) 0 % Expected volatility (%) 40 % Risk-free interest rate (%) 0.1-0.6 % |
Share-based Payment Arrangement, Expensed and Capitalized, Amount | The following table summarizes the components of stock-based compensation expense recognized for the periods presented: Three months ended September 30, Nine months ended September 30, (in thousands) 2021 2020 2021 2020 Cost of services $ 451 $ — $ 502 $ — Selling, general, and administrative expense 18,792 — 152,008 — Total $ 19,243 $ — $ 152,510 $ — |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings per Share | The following table summarizes the computation of basic and diluted EPS for the three and nine months ended September 30, 2021 and 2020: Three months ended September 30, Nine months ended September 30, (in thousands,except share and per share data) 2021 2020 2021 2020 Numerator: Net income (loss) available to common shareholders $ 11,636 $ 11,456 $ (77,800) $ 20,979 Denominator: Weighted-average common shares outstanding – basic 97,290,174 91,737,020 93,994,896 91,737,020 Effect of dilutive securities 12,135,837 — — — Weighted-average common shares outstanding – diluted 109,426,011 91,737,020 93,994,896 91,737,020 Net income (loss) per common share: Basic $ 0.12 $ 0.12 $ (0.83) $ 0.23 Diluted $ 0.11 $ 0.12 $ (0.83) $ 0.23 |
Description of Business and O_2
Description of Business and Organization (Details) | Jun. 10, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Stock split ratio | 10 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Summary of Concentration Risk (Details) - Customer Concentration Risk | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Service revenue percentage | Customer A | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 27.00% | 33.00% | 27.00% | 33.00% | |
Service revenue percentage | Customer B | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 11.00% | 11.00% | 11.00% | 13.00% | |
Accounts receivable percentage | Customer A | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 26.00% | 22.00% | |||
Accounts receivable percentage | Customer B | |||||
Concentration Risk [Line Items] | |||||
Concentration risk | 13.00% | 16.00% |
Revenue - Summary of Revenue (D
Revenue - Summary of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 201,053 | $ 122,425 | $ 533,946 | $ 339,254 |
Philippines | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 103,837 | 69,369 | 284,096 | 188,085 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 65,866 | 42,761 | 175,553 | 126,835 |
Rest of World | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 31,350 | 10,295 | 74,297 | 24,334 |
Digital Customer Experience | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 125,310 | 76,255 | 338,587 | 212,817 |
Content Security | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 45,376 | 33,787 | 124,498 | 91,401 |
AI Operations | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 30,367 | $ 12,383 | $ 70,861 | $ 35,036 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Revenue from Contract with Customer [Abstract] | ||
Unbilled revenues | $ 67.6 | $ 47.4 |
Forward Contract - Narrative (D
Forward Contract - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Other (Income) Expense | |||||
Derivative [Line Items] | |||||
Unrealized loss (gain) on derivatives | $ 4.1 | $ 1.2 | $ 5.8 | $ 1.3 | |
Forward contract | |||||
Derivative [Line Items] | |||||
Derivative term | 12 months | ||||
Settled forward contracts | 31.8 | 26 | $ 77.4 | 62 | |
Derivative notional amount | 116.6 | 116.6 | $ 109.2 | ||
Forward contract | Other (Income) Expense | |||||
Derivative [Line Items] | |||||
Loss (gain) on sale of derivatives | $ 0.7 | $ (1.9) | $ (0.6) | $ (3.5) |
Forward Contract - Assets Measu
Forward Contract - Assets Measured at Fair Value on a Recurring Basis (Details) - Forward contract - Fair Value, Recurring - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Derivative [Line Items] | ||
Derivative liability | $ 4,051 | |
Derivative asset | $ 1,780 | |
Level 1 inputs | ||
Derivative [Line Items] | ||
Derivative liability | 0 | |
Derivative asset | 0 | |
Level 2 inputs | ||
Derivative [Line Items] | ||
Derivative liability | 4,051 | |
Derivative asset | 1,780 | |
Level 3 inputs | ||
Derivative [Line Items] | ||
Derivative liability | $ 0 | |
Derivative asset | $ 0 |
Property and Equipment, net - S
Property and Equipment, net - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 127,030 | $ 94,618 |
Accumulated depreciation | (54,887) | (37,661) |
Property and equipment, net | 72,143 | 56,957 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 32,902 | 31,654 |
Technology and computers | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 68,589 | 47,572 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,000 | 4,203 |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 14,480 | 5,194 |
Other property and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 7,059 | $ 5,995 |
Property and Equipment, net -_2
Property and Equipment, net - Summary of Property and Equipment by Geographic Location (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 72,143 | $ 56,957 |
Philippines | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 44,432 | 37,823 |
United States | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | 11,077 | 8,983 |
Rest of World | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, net | $ 16,634 | $ 10,151 |
Goodwill and Intangibles (Detai
Goodwill and Intangibles (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | $ 195,735 | $ 195,735 |
Intangibles, Gross | 282,700 | 282,700 |
Accumulated Amortization | (56,540) | (42,405) |
Intangibles, Net | $ 226,160 | $ 240,295 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Life (Years) | 15 years | 15 years |
Intangibles, Gross | $ 240,800 | $ 240,800 |
Accumulated Amortization | (48,161) | (36,121) |
Intangibles, Net | $ 192,639 | $ 204,679 |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Life (Years) | 15 years | 15 years |
Intangibles, Gross | $ 41,900 | $ 41,900 |
Accumulated Amortization | (8,379) | (6,284) |
Intangibles, Net | $ 33,521 | $ 35,616 |
Long-Term Debt - Schedule of De
Long-Term Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Apr. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | |||
Less current debt financing fees | $ (556) | ||
Less noncurrent debt financing fees | (1,111) | ||
Less: Debt financing fees | (1,667) | ||
Current portion of debt | 49,822 | $ 45,984 | |
Long-term debt | 191,039 | $ 198,768 | |
Total | 240,861 | ||
2019 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Less: Debt financing fees | $ (300) | ||
Secured Debt | 2019 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Long term debt, current, gross | 10,500 | ||
Long term debt, noncurrent, gross | 192,150 | ||
Long term debt, gross | 202,650 | ||
Line of Credit | 2019 Credit Agreement | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Long term debt, current, gross | 39,878 | ||
Long term debt, noncurrent, gross | 0 | ||
Long term debt, gross | $ 39,878 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) | Sep. 25, 2019 | Sep. 30, 2021 | Apr. 30, 2021 |
Debt Instrument [Line Items] | |||
Debt financing fees | $ 1,667,000 | ||
2019 Credit Agreement | |||
Debt Instrument [Line Items] | |||
Debt financing fees | $ 300,000 | ||
2019 Credit Agreement | Secured Debt | |||
Debt Instrument [Line Items] | |||
Debt instrument, face amount | $ 210,000,000 | ||
Effective interest rate | 2.334% | ||
2019 Credit Agreement | Secured Debt | Year One | |||
Debt Instrument [Line Items] | |||
Percentage of original principal amount | 1.00% | ||
2019 Credit Agreement | Secured Debt | Year Two | |||
Debt Instrument [Line Items] | |||
Percentage of original principal amount | 2.50% | ||
2019 Credit Agreement | Secured Debt | Year Three | |||
Debt Instrument [Line Items] | |||
Percentage of original principal amount | 5.00% | ||
2019 Credit Agreement | Secured Debt | Year Four | |||
Debt Instrument [Line Items] | |||
Percentage of original principal amount | 7.50% | ||
2019 Credit Agreement | Secured Debt | Year Five | |||
Debt Instrument [Line Items] | |||
Percentage of original principal amount | 10.00% | ||
2019 Credit Agreement | Line of Credit | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 40,000,000 | ||
Line of credit facility, additional borrowing capacity | $ 50,000,000 | ||
Effective interest rate | 2.334% | ||
Line of credit facility, commitment fee percent | 0.40% | ||
Line of credit facility, remaining borrowing capacity | $ 50,100,000 | ||
2019 Credit Agreement | Line of Credit | Letter of Credit | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 15,000,000 | ||
2019 Credit Agreement | Line of Credit | Bridge Loan | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 5,000,000 |
Employee Compensation - Narrati
Employee Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 10, 2021 | Apr. 16, 2019 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 19,243 | $ 0 | $ 152,510 | $ 0 | |||
Options granted in period (in shares) | 2,265,146 | ||||||
Stock Option weighted average grant date fair value (in usd per share) | $ 9.34 | ||||||
Options outstanding (in shares) | 9,744,028 | 9,744,028 | |||||
Weighted average exercise price of options outstanding (in usd per share) | $ 10.06 | $ 10.06 | |||||
Unrecognized compensation expense related to stock options | $ 22,300 | $ 22,300 | |||||
Phantom Stock Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares outstanding (in shares) | 0 | 0 | 6,514,360 | ||||
Shares forfeited (in shares) | 1,399,470 | ||||||
Stock-based compensation expense | $ 127,500 | $ 127,500 | |||||
2021 Omnibus Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Awards granted (in shares) | 6,614,122 | ||||||
Shares reserved for issuance (in shares) | 12,160,929 | ||||||
Stock Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Contractual life | 10 years | ||||||
Award vesting period | 4 years | ||||||
Weighted average period for recognition | 2 years 4 months 24 days | ||||||
Stock Option | 2019 Stock Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period contingent on a change in control | 2 years | ||||||
Vesting period contingent on an initial public offering | 3 years | ||||||
Contractual life | 10 years | ||||||
RSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Awards granted (in shares) | 4,277,543 | ||||||
Award vesting period | 4 years | ||||||
Weighted average period for recognition | 2 years 4 months 24 days | ||||||
Weighted average grant date fair value (in usd per share) | $ 27.23 | ||||||
Unrecognized compensation expense | 98,900 | $ 98,900 | |||||
PSUs | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Awards granted (in shares) | 3,373,417 | ||||||
Award vesting period | 4 years | ||||||
Weighted average period for recognition | 2 years 8 months 12 days | ||||||
Weighted average grant date fair value (in usd per share) | $ 4.02 | ||||||
Unrecognized compensation expense | $ 11,700 | $ 11,700 |
Employee Compensation - Grant D
Employee Compensation - Grant Date Fair Value of Stock Options (Details) - Stock Option | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Dividend yield (%) | 0.00% |
Minimum expected volatility (%) | 32.00% |
Maximum expected volatility (%) | 35.00% |
Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate (%) | 0.80% |
Expected term (years) | 5 years 1 month 6 days |
Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate (%) | 1.30% |
Expected term (years) | 7 years |
Employee Compensation - Grant_2
Employee Compensation - Grant Date Fair Value of PSUs (Details) - PSUs | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Dividend yield (%) | 0.00% |
Expected volatility (%) | 40.00% |
Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate (%) | 0.10% |
Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate (%) | 0.60% |
Employee Compensation - Summary
Employee Compensation - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | $ 19,243 | $ 0 | $ 152,510 | $ 0 |
Cost of services | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | 451 | 0 | 502 | 0 |
Selling, general, and administrative expense | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | $ 18,792 | $ 0 | $ 152,008 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 1,656 | $ 2,564 | $ (1,805) | $ 4,532 |
Effective income tax rate | 12.50% | 18.30% | 2.30% | 17.80% |
Shareholders' Equity (Details)
Shareholders' Equity (Details) $ / shares in Units, $ in Thousands | Jun. 15, 2021USD ($)$ / sharesshares | Jun. 10, 2021vote$ / sharesshares | Apr. 09, 2021USD ($) | Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2020USD ($) | Dec. 31, 2020$ / sharesshares |
Subsidiary, Sale of Stock [Line Items] | ||||||||
Dividends | $ | $ 50,000 | |||||||
Stock split ratio | 10 | |||||||
Preferred stock, authorized (in shares) | 250,000,000 | |||||||
Preferred stock, par value (in usd per share) | $ / shares | $ 0.01 | |||||||
Stock-based compensation expense | $ | $ 19,243 | $ 0 | $ 152,510 | $ 0 | ||||
Phantom Stock Plan | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Stock-based compensation expense | $ | $ 127,500 | $ 127,500 | ||||||
IPO And Private Placement | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Sale of stock, number of shares issued (in shares) | 15,180,000 | |||||||
Sale of stock, price (in usd per share) | $ / shares | $ 23 | |||||||
IPO | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Sale of stock, number of shares issued (in shares) | 5,553,154 | |||||||
Sale of stock, consideration received | $ | $ 120,700 | |||||||
Private Placement | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Sale of stock, number of shares issued (in shares) | 9,626,846 | |||||||
Class A Common stock | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 2,500,000,000 | 2,500,000,000 | 2,500,000,000 | 2,500,000,000 | ||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Number of votes per share | vote | 1 | |||||||
Class B Common stock | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Common stock, shares authorized (in shares) | 250,000,000 | 250,000,000 | 250,000,000 | 250,000,000 | ||||
Common stock, par value (in usd per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Number of votes per share | vote | 10 | |||||||
Common stock, conversion period | 7 years |
Earnings (Loss) Per Share - Sum
Earnings (Loss) Per Share - Summary of Basic and Diluted Earnings (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Numerator: | ||||||||
Net income (loss) available to common shareholders | $ 11,636 | $ (105,943) | $ 16,507 | $ 11,456 | $ 8,008 | $ 1,515 | $ (77,800) | $ 20,979 |
Denominator: | ||||||||
Weighted-average common shares outstanding – basic (in shares) | 97,290,174 | 91,737,020 | 93,994,896 | 91,737,020 | ||||
Effect of dilutive securities (in shares) | 12,135,837 | 0 | 0 | 0 | ||||
Weighted-average common shares outstanding – diluted (in shares) | 109,426,011 | 91,737,020 | 93,994,896 | 91,737,020 | ||||
Net income (loss) per common share: | ||||||||
Basic (in usd per share) | $ 0.12 | $ 0.12 | $ (0.83) | $ 0.23 | ||||
Diluted (in usd per share) | $ 0.11 | $ 0.12 | $ (0.83) | $ 0.23 |
Earnings (Loss) Per Share - Nar
Earnings (Loss) Per Share - Narrative (Details) - shares | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | |
Common Stock Equivalents, Anti-Dilutive | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 12,309 | 23,607 |
Common Stock Equivalents, Antidilutive, Potentially Dilutive Securities | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 5,578,525 |
Related Party (Details)
Related Party (Details) - USD ($) $ / shares in Units, $ in Millions | Jun. 15, 2021 | Oct. 01, 2018 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 |
TaskUs Holdings | Bidco | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of outstanding shares acquired | 100.00% | |||||
Consideration transferred | $ 429.4 | |||||
Affiliated Entity | Sellers of TaskUs, Inc | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transaction with related party | $ 3.6 | |||||
Affiliated Entity | BMP | Support And Services Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transaction with related party | $ 0.2 | 0.2 | ||||
Affiliated Entity | Alight | Consulting Services And Promotional Items | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transaction with related party | $ 0.4 | $ 0.9 | ||||
Affiliated Entity | Custom Ink | Consulting Services And Promotional Items | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transaction with related party | 0.2 | |||||
Affiliated Entity | Custom Ink | Interest In TaskUs Customers | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from related parties | 0.8 | 1.5 | ||||
Affiliated Entity | Mphasis | Consulting Services And Promotional Items | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transaction with related party | 0.2 | |||||
Affiliated Entity | Vivint | Interest In TaskUs Customers | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from related parties | 0.6 | 1.5 | ||||
Affiliated Entity | North American Bancard | Interest In TaskUs Customers | ||||||
Related Party Transaction [Line Items] | ||||||
Revenue from related parties | 0.7 | 1.3 | ||||
Affiliated Entity | Management Consulting Firm | Consulting Services | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses from transaction with related party | $ 0.1 | $ 0.1 | $ 0.2 | $ 0.2 | ||
IPO And Private Placement | ||||||
Related Party Transaction [Line Items] | ||||||
Sale of stock, number of shares issued (in shares) | 15,180,000 | |||||
IPO And Private Placement | Affiliated Entity | Blackstone Securities Partners L.P. | Underwriting of IPO | ||||||
Related Party Transaction [Line Items] | ||||||
Sale of stock, number of shares issued (in shares) | 1,380,000 | |||||
Sale of stock, discount and commission (in usd per share) | $ 1.265 |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | Oct. 25, 2021 | Jun. 15, 2021 |
Private Placement | ||
Subsequent Event [Line Items] | ||
Sale of stock, number of shares issued (in shares) | 9,626,846 | |
Private Placement | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Sale of stock, number of shares issued (in shares) | 12,077,480 | |
Sale of stock, price (in usd per share) | $ 63.50 | |
Private Placement | Subsequent Event | Blackstone Securities Partners L.P. | Underwriting of IPO | Affiliated Entity | ||
Subsequent Event [Line Items] | ||
Sale of stock, number of shares issued (in shares) | 1,021,942 | |
Sale of stock, discount and commission (in usd per share) | $ 2.06375 | |
Over-Allotment Option | Subsequent Event | Blackstone Securities Partners L.P. | Underwriting of IPO | Affiliated Entity | ||
Subsequent Event [Line Items] | ||
Sale of stock, number of shares issued (in shares) | 1,811,622 |