Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | May 06, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 000-30141 | |
Entity Registrant Name | LIVEPERSON, INC. | |
Entity Central Index Key | 0001102993 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3861628 | |
Entity Address, Address Line One | 530 7th Ave, Floor M1 | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10018 | |
City Area Code | (212) | |
Local Phone Number | 609-4200 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 88,614,097 | |
Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | LPSN | |
Security Exchange Name | NASDAQ | |
Rights to Purchase Series A Junior Participating Preferred Stock | ||
Document Information [Line Items] | ||
No Trading Symbol Flag | true | |
Title of 12(b) Security | Rights to Purchase Series A JuniorParticipating Preferred Stock | |
Security Exchange Name | NASDAQ | |
No Trading Symbol Flag | true |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 127,057 | $ 210,782 |
Restricted cash | 1,960 | 2,143 |
Accounts receivable, net of allowance for credit losses of $9,235 and $9,290 as of March 31, 2024 and December 31, 2023, respectively | 71,365 | 81,802 |
Prepaid expenses and other current assets (Note 1) | 20,954 | 26,981 |
Total current assets | 221,336 | 321,708 |
Operating lease right-of-use assets (Note 9) | 3,431 | 4,135 |
Property and equipment, net (Note 6) | 117,893 | 119,325 |
Contract acquisition costs, net | 39,326 | 37,354 |
Intangible assets, net (Note 5) | 56,009 | 61,625 |
Goodwill (Note 5) | 280,956 | 285,631 |
Deferred tax assets | 4,473 | 4,527 |
Other assets | 1,264 | 1,208 |
Total assets | 724,688 | 835,513 |
Current liabilities: | ||
Accounts payable | 14,528 | 13,555 |
Accrued expenses and other current liabilities (Note 7) | 75,506 | 97,024 |
Deferred revenue (Note 2) | 92,414 | 81,858 |
Convertible senior notes (Note 8) | 0 | 72,393 |
Operating lease liabilities (Note 9) | 2,632 | 2,719 |
Total current liabilities | 185,080 | 267,549 |
Convertible senior notes, net of current portion (Note 8) | 512,076 | 511,565 |
Operating lease liabilities, net of current portion (Note 9) | 1,466 | 2,173 |
Deferred tax liabilities | 3,002 | 2,930 |
Other liabilities | 3,881 | 3,158 |
Total liabilities | 705,505 | 787,375 |
Commitments and contingencies (Note 11) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value - 5,000,000 shares authorized, none issued | 0 | 0 |
Common stock, $0.001 par value - 200,000,000 shares authorized, 91,131,823 and 90,603,519 shares issued, 88,365,750 and 87,837,446 shares outstanding as of March 31, 2024 and December 31, 2023, respectively. | 92 | 91 |
Treasury stock - 2,766,073 shares at March 31, 2024 and December 31, 2023 | (3) | (3) |
Additional paid-in capital | 921,895 | 913,522 |
Accumulated deficit | (892,619) | (856,988) |
Accumulated other comprehensive loss | (10,182) | (8,484) |
Total stockholders’ equity | 19,183 | 48,138 |
Total liabilities and stockholders’ equity | $ 724,688 | $ 835,513 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) $ in Thousands | Mar. 31, 2024 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances including credit loss and sales reserve | $ | $ 9,235 | $ 9,290 |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Preferred stock, issued (in shares) | 0 | 0 |
Common stock, authorized (in shares) | 200,000,000 | 200,000,000 |
Common stock, issued (in shares) | 91,131,823 | 90,603,519 |
Common stock, outstanding (in shares) | 88,365,750 | 87,837,446 |
Treasury stock (in shares) | 2,766,073 | 2,766,073 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Revenue | $ 85,149,000 | $ 107,661,000 |
Costs, expenses and other: | ||
Cost of revenue | 29,463,000 | 43,096,000 |
Sales and marketing | 30,130,000 | 34,470,000 |
General and administrative | 21,752,000 | 31,447,000 |
Product development | 30,120,000 | 36,519,000 |
Impairment of goodwill | 3,627,000 | 0 |
Impairment of intangibles and other assets | 2,221,000 | 0 |
Restructuring costs | 3,309,000 | 11,515,000 |
Gain on divestiture | 0 | (17,591,000) |
Amortization of purchased intangible assets | 891,000 | 874,000 |
Total costs, expenses and other | 121,513,000 | 140,330,000 |
Loss from operations | (36,364,000) | (32,669,000) |
Other income (expense), net: | ||
Interest income, net | 1,332,000 | 1,801,000 |
Other (expense) income, net | (237,000) | 14,662,000 |
Total other income | 1,095,000 | 16,463,000 |
Loss before provision for income taxes | (35,269,000) | (16,206,000) |
Provision for income taxes | 362,000 | 1,214,000 |
Net Income (loss) | $ (35,631,000) | $ (17,420,000) |
Net loss per share of common stock: | ||
Basic (in dollars per share) | $ (0.40) | $ (0.23) |
Diluted (in dollars per share) | $ (0.40) | $ (0.23) |
Weighted average shares outstanding: | ||
Basic (in shares) | 88,081,654 | 75,774,812 |
Diluted (in shares) | 88,081,654 | 75,774,812 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (35,631) | $ (17,420) |
Foreign currency translation adjustment | (1,698) | 866 |
Comprehensive loss | $ (37,329) | $ (16,554) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (unaudited) - USD ($) $ in Thousands | Total | Common Stock | Treasury Stock, Common | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Beginning balance (in shares) at Dec. 31, 2022 | 78,350,984 | (2,766,073) | ||||
Beginning balance at Dec. 31, 2022 | $ 68,088 | $ 78 | $ (3) | $ 771,052 | $ (692,362) | $ (10,677) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common stock issued upon exercise of stock options (in shares) | 18,687 | |||||
Common stock issued upon exercise of stock options | 130 | 130 | ||||
Common stock issued upon vesting of restricted stock units (in shares) | 413,252 | |||||
Common stock issued upon vesting of restricted stock units | 1 | $ 1 | ||||
Stock-based compensation | 9,560 | 9,560 | ||||
Common stock issued under Employee Stock Purchase Plan (in shares) | 87,794 | |||||
Common stock issued under Employee Stock Purchase Plan (ESPP) | 724 | 724 | ||||
Issuance of common stock in connection with acquisitions (Note 9) | 380 | 380 | ||||
Activity related to divestiture (Note 20) | 2,732 | 66,775 | (64,100) | 57 | ||
Net loss | (17,420) | (17,420) | ||||
Other comprehensive income | 809 | 809 | ||||
Ending balance (in shares) at Mar. 31, 2023 | 78,870,717 | (2,766,073) | ||||
Ending balance at Mar. 31, 2023 | 65,004 | $ 79 | $ (3) | 848,621 | (773,882) | (9,811) |
Beginning balance (in shares) at Dec. 31, 2023 | 90,603,519 | (2,766,073) | ||||
Beginning balance at Dec. 31, 2023 | $ 48,138 | $ 91 | $ (3) | 913,522 | (856,988) | (8,484) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Common stock issued upon exercise of stock options (in shares) | 0 | |||||
Common stock issued upon vesting of restricted stock units (in shares) | 432,701 | |||||
Common stock issued upon vesting of restricted stock units | $ 2 | $ 1 | 1 | |||
Stock-based compensation | 8,251 | 8,251 | ||||
Common stock issued under Employee Stock Purchase Plan (in shares) | 95,603 | |||||
Common stock issued under Employee Stock Purchase Plan (ESPP) | 121 | 121 | ||||
Net loss | (35,631) | (35,631) | ||||
Other comprehensive income | (1,698) | (1,698) | ||||
Ending balance (in shares) at Mar. 31, 2024 | 91,131,823 | (2,766,073) | ||||
Ending balance at Mar. 31, 2024 | $ 19,183 | $ 92 | $ (3) | $ 921,895 | $ (892,619) | $ (10,182) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
OPERATING ACTIVITIES: | ||||
Net loss | $ (35,631,000) | $ (17,420,000) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Stock-based compensation expense | 7,558,000 | 11,332,000 | ||
Depreciation | 8,225,000 | 7,362,000 | ||
Reduction of operating lease right-of-use assets | 653,000 | 658,000 | ||
Amortization of purchased intangible assets and finance leases | 4,217,000 | 5,435,000 | ||
Amortization of debt issuance costs | 610,000 | 920,000 | ||
Impairment of goodwill | 3,627,000 | 0 | $ 11,895,000 | |
Impairment of intangible assets | 2,221,000 | 0 | ||
Change in fair value of contingent consideration | 0 | (1,709,000) | ||
Gain on repurchase of convertible notes | 0 | (6,100,000) | ||
Allowance for credit losses | 4,722,000 | 1,079,000 | 3,319,000 | |
Gain on divestiture | 0 | (17,591,000) | ||
Deferred income taxes | 75,000 | 589,000 | ||
Equity loss in joint venture | 0 | 618,000 | ||
Changes in operating assets and liabilities, net of acquisitions: | ||||
Accounts receivable | 5,422,000 | (34,731,000) | ||
Prepaid expenses and other current assets | 5,854,000 | (6,262,000) | ||
Contract acquisition costs | (2,370,000) | 530,000 | ||
Other assets | (75,000) | 79,000 | ||
Accounts payable | 1,966,000 | (9,910,000) | ||
Accrued expenses and other current liabilities | (16,976,000) | 41,266,000 | ||
Deferred revenue | 10,852,000 | 24,750,000 | ||
Operating lease liabilities | (738,000) | (944,000) | ||
Other liabilities | 887,000 | (5,869,000) | ||
Net cash provided by (used in) operating activities | 1,099,000 | (5,918,000) | ||
INVESTING ACTIVITIES: | ||||
Purchases of property and equipment, including capitalized software | (11,501,000) | (9,625,000) | ||
Purchases of intangible assets | (1,209,000) | (1,355,000) | ||
Proceeds from divestiture | 0 | 13,819,000 | ||
Net cash (used in) provided by investing activities | (12,710,000) | 2,839,000 | ||
FINANCING ACTIVITIES: | ||||
Principal payments for financing leases | (327,000) | (958,000) | ||
Proceeds from issuance of common stock in connection with the exercise of options and ESPP | 122,000 | 854,000 | ||
Payments on repurchase of convertible senior notes | (72,492,000) | (149,702,000) | ||
Net cash used in financing activities | (72,697,000) | (149,806,000) | ||
Effect of foreign exchange rate changes on cash and cash equivalents | 400,000 | 2,849,000 | ||
Net decrease in cash, cash equivalents, and restricted cash | (83,908,000) | (150,036,000) | ||
Cash, cash equivalents, and restricted cash - beginning of year | 212,925,000 | 392,197,000 | 392,197,000 | |
Plus: cash classified within current assets held for sale - beginning of year | 0 | $ 10,011,000 | ||
Cash, cash equivalents, and restricted cash - end of period | 129,017,000 | 252,172,000 | 212,925,000 | |
Reconciliation of cash, cash equivalents, and restricted cash to condensed consolidated balance sheets | ||||
Cash and cash equivalents | 127,057,000 | 239,975,000 | 210,782,000 | |
Restricted cash | 1,960,000 | 12,197,000 | 2,143,000 | |
Total cash, cash equivalents, and restricted cash | 129,017,000 | 252,172,000 | $ 212,925,000 | $ 392,197,000 |
Supplemental disclosure of other cash flow information: | ||||
Cash paid for income taxes, net | 451,000 | 187,000 | ||
Cash paid for interest | 292,000 | 888,000 | ||
Supplemental disclosure of non-cash investing and financing activities: | ||||
Purchase of property and equipment and intangible assets recorded in accounts payable | $ 50,000 | $ 790,000 |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation LivePerson, Inc. (“LivePerson”, the “Company”, “we”, “our” or “us”) is the enterprise leader in digital customer conversation. Over the past two decades, consumers have made digital conversations a primary way to communicate with others. Since 1998, we have enabled meaningful connections between consumers and our customers through our platform and currently power more than one billion connections and conversations each month. These digital and artificial intelligence (“AI”)-powered conversations decrease costs and increase revenue for our brands, resulting in more convenient, personalized and content-rich journeys across the entire consumer lifecycle, and across consumer channels. AI has accelerated our capability to leverage prior conversations and our customers’ existing investments in Generative AI and Large Language Models (“LLMs”) to enhance the consumer experience and to improve results for our customers by empowering them to leverage the latest developments in AI and LLMs, in a safe and secure environment. The Conversational Cloud, the Company’s enterprise-class digital customer conversation platform, is trusted by the world’s top brands to accelerate their contact center transformation, orchestrate conversations across all channels, departments and systems, increase agent productivity, and deliver more personalized, AI-empowered customer experiences. The Conversational Cloud powers conversations across each of a brand’s primary digital channels, including mobile apps, mobile and desktop web browsers, short messaging service (“SMS”), social media and third-party consumer messaging platforms. Brands can also use the Conversational Cloud to message consumers when they dial a 1-800 number instead of forcing them to navigate interactive voice response systems and wait on hold. Most recently, the Conversational Cloud has been enhanced to provide a secure platform with appropriate guardrails to deploy Generative AI and LLMs in ways that help consumers and drive results for brands without sacrificing trust. LivePerson’s digital customer conversation platform enables what the Company calls “the tango” of humans, LivePerson bots, third-party bots and LLMs, whereby humans act as bot managers, overseeing AI-powered conversations and seamlessly stepping into the flow when a personal touch is needed. Agents become highly efficient, leveraging the AI engine (including generative AI capabilities) to surface relevant content, define next-best actions and take over repetitive transactional work so that the agent can focus on relationship building. By seamlessly integrating messaging with the Company’s proprietary Conversational AI, as well as bots, the Conversational Cloud offers brands a comprehensive approach to scaling automations across their millions of customer conversations. Basis of Presentation The accompanying condensed consolidated financial statements, and the financial data and other information disclosed in the notes to the condensed consolidated financial statements as of March 31, 2024 and for the three months ended March 31, 2024 are unaudited. In the opinion of management, the unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments necessary for a fair presentation of the Company’s condensed consolidated financial position, results of operations, comprehensive loss, and cash flows for the interim periods presented. The results of operations for any interim period are not necessarily indicative of the results of operations for any other future interim period or for a full fiscal year. The condensed consolidated balance sheet as of December 31, 2023 has been derived from audited consolidated financial statements at that date. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 4, 2024. Principles of Consolidation The unaudited condensed consolidated financial statements reflect the operations of LivePerson and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates are based on information available as of the date of the condensed consolidated financial statements. On a regular basis, management evaluates these estimates and assumptions. Items subject to such estimates and assumptions include, but are not limited to: • stock-based compensation expense; • allowance for credit losses; • the period of benefit for deferred contract acquisition costs; • valuation of goodwill; • valuation and useful lives of other long-lived assets; • fair value of assets acquired and liabilities assumed in business combinations; • income taxes; and • recognition, measurement, and disclosure of contingent liabilities. As of the date of issuance of the financial statements, the Company is not aware of any material specific events or circumstances that would require it to update its estimates, judgments, or to revise the carrying values of its assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the condensed consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to the Company’s condensed consolidated financial statements. Significant Accounting Policies The Company’s significant accounting policies are described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. There have been no significant changes to these policies that have had a material impact on the Company’s condensed consolidated financial statements and related notes for the three months ended March 31, 2024. Prepaid expenses and other current assets The following table presents the detail of prepaid expenses and other current assets as of the dates presented: March 31, December 31, (In thousands) Prepaid software maintenance $ 6,065 $ 8,592 VAT receivable 4,168 4,399 Prepaid server maintenance 2,824 2,634 Prepaid - other 2,743 2,599 Other assets 5,154 8,757 Total prepaid expenses and other current assets $ 20,954 $ 26,981 Recently Adopted Accounting Pronouncements In June 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-03, Fair Value Measurement (Topic 820), Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions to clarify that a contractual restriction on the sale of an equity security is not considered part of a unit of account of the equity security, and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments also require the following disclosures for equity securities subject to the contractual sale restrictions: 1.) The fair value of equity securities subject to the contractual sale restrictions reflected on the balance sheet. 2.) The nature and remaining duration of the restriction(s). 3.) The circumstances that could cause a lapse in the restriction(s). This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within those financial years. The Company adopted this guidance on January 1, 2024, which did not have a material effect on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements On March 21, 2024, the FASB issued ASU 2024-01, Compensation—Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards , which provides illustrative guidance to help entities determine whether profits interest and similar awards should be accounted for as share-based payment arrangements within the scope of FASB Accounting Standards Codification (“ASC”) 718, “Compensation—Stock Compensation.” Specifically, the amendments in ASU 2024-01 add an illustrative example that includes four fact patterns to demonstrate how an entity should apply the scope guidance in paragraph 718-10-15-3 to determine whether a profits interest award should be accounted for in accordance with Topic 718. The guidance in ASU 2024-01 applies to all entities that issue profits interest awards as compensation to employees or non-employees in exchange for goods or services. The amendments in this update are effective for annual periods beginning after December 15, 2024, and interim periods within those annual periods. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. ASU 2024-01 should be applied either retrospectively or prospectively. The Company does not expect this this standard to have a material impact on its condensed consolidated financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The updated standard is effective for annual periods beginning after December 15, 2023. The Company is currently evaluating the potential impact of adopting this new guidance on its condensed consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The guidance is effective for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted. The Company does not expect this standard to have a material impact on its condensed consolidated financial statements and related disclosures. In August 2023, the FASB issued ASU 2023-05, Business Combinations—Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement , which addresses the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. The amendments require certain joint ventures to apply a new basis of accounting upon formation by recognizing and initially measuring most of their assets and liabilities at fair value. The objectives of the amendments are to provide decision-useful information to investors and other allocators of capital in a joint venture’s financial statements and also to reduce diversity in practice. ASU 2023-05 is effective for both public and private joint venture entities with a formation date on or after January 1, 2025. Early adoption is permitted. Entities may elect to apply the guidance retrospectively to joint ventures with a formation date prior to |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The majority of the Company’s revenue is generated from hosted service revenues, which is inclusive of its platform pricing model, and related professional services. Revenues are recognized when control of these services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. No single customer accounted for 10% or more of total revenue for the three months ended March 31, 2024 and 2023. The following table presents the Company’s revenues disaggregated by revenue source: Three Months Ended March 31, 2024 2023 (In thousands) Revenue: Hosted services (1) $ 71,495 $ 87,338 Professional services 13,654 20,323 Total revenue $ 85,149 $ 107,661 (1) On March 20, 2023, the Company completed the sale of Kasamba and therefore ceased recognizing revenue related to Kasamba effective on the transaction close date. Further, this sale eliminated the entire Consumer segment, as a result of which revenue is presented within a single condensed consolidated segment. Hosted services includes $7.2 million of revenue for the three months ended March 31 2023, relating to Kasamba. Remaining Performance Obligation As of March 31, 2024, the aggregate amount of the total transaction price allocated in contracts with original duration of one year or greater to the remaining performance obligations was $296.7 million. Approximately 91% of the Company’s remaining performance obligations is expected to be recognized during the next 24 months, with the balance recognized thereafter. The aggregate balance of unsatisfied performance obligations represents contracted revenue that has not yet been recognized, and does not include contract amounts that are cancellable by the customer, amounts associated with optional renewal periods, and any amounts related to performance obligations, which are billed and recognized as they are delivered. The Company has elected the optional exemption, which allows for the exclusion of the amounts for remaining performance obligations that are part of contracts with an original expected duration of less than one year. Such remaining performance obligations represent unsatisfied or partially unsatisfied performance obligations pursuant to ASC 606, “Revenue from Contracts with Customers.” Revenue by Geographic Location The Company is domiciled in the United States and has international operations around the globe. The following table presents the Company’s revenues attributable to domestic and foreign operations for the periods presented: Three Months Ended March 31, 2024 2023 (In thousands) United States $ 60,507 $ 68,509 Other Americas (1) 1,518 3,805 Total Americas 62,025 72,314 EMEA (2) (3) 14,221 16,182 APAC (4) 8,903 19,165 Total revenue $ 85,149 $ 107,661 —————————————— (1) Canada, Latin America and South America (2) Europe, the Middle East and Africa (“EMEA”) (3) Includes revenue from the United Kingdom of $10.7 million and $15.3 million for the three months ended March 31, 2024 and 2023, respectively. (4) Asia-Pacific (“APAC”) Information about Contract Balances The deferred revenue balance consists of services, which have been invoiced upfront, and are recognized as revenue only when the revenue recognition criteria are met. In some arrangements, the Company allows customers to pay for access to the Conversational Cloud over the term of the software license. The Company refers to these as subscription transactions. Amounts recognized as revenue in excess of amounts billed are recorded as unbilled receivables. Unbilled receivables, anticipated to be invoiced in the next twelve months, are included in accounts receivable, net of allowance for credit losses on the condensed consolidated balance sheets. The Company recognized revenue of $42.5 million and $44.1 million for the three months ended March 31, 2024 and 2023, respectively, which was included in the corresponding deferred revenue balance at the beginning of the year. The deferred revenue balance consists of services, which have been invoiced upfront, and are recognized as revenue only when the revenue recognition criteria are met. Our long-term deferred revenues are included in Other liabilities on the condensed consolidated balance sheets. The opening and closing balances of the Company’s accounts receivable, unbilled receivables, and deferred revenues are as follows: Accounts Receivable Unbilled Receivable Contract Acquisition Costs, Net (Non-current) Deferred Revenue (Current) Deferred Revenue (In thousands) Balance as of December 31, 2022 $ 53,468 $ 33,069 $ 43,804 $ 84,494 $ 174 Increase (decrease), net 6,914 (11,649) (6,450) (2,636) 9 Balance as of December 31, 2023 $ 60,382 $ 21,420 $ 37,354 $ 81,858 $ 183 Increase (decrease), net (6,177) (4,260) 1,972 10,556 (60) Balance as of March 31, 2024 $ 54,205 $ 17,160 $ 39,326 $ 92,414 $ 123 Amortization expense in connection with contract acquisition cost was approximately $4.9 million and $8.3 million for the three months ended March 31, 2024 and 2023, respectively. Accounts Receivable, Net Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for credit losses is the Company’s best estimate of the amount of probable credit losses in the Company’s existing accounts receivable, based on both specific and general reserves. The Company maintains general reserves on a collective basis by considering factors such as historical experience, creditworthiness, the age of the trade receivable balances, and current econom ic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet credit exposure related to its customers. The activity in the allowance for credit losses is as follows: March 31, December 31, (In thousands) Balance, beginning of year $ 9,290 9,239 Additions charged to costs and expenses 4,722 3,319 Deductions/write-offs (4,777) (3,268) Balance, end of period $ 9,235 $ 9,290 |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share Basic earnings per share (“EPS”) excludes dilution for common stock equivalents and is computed by dividing net income or loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted EPS is calculated based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period. Potentially dilutive securities consist of common stock options, restricted stock units, contingently issuable shares and convertible securities. The dilutive effect of stock options, restricted stock units and contingently issuable shares is reflected in diluted EPS by application of the treasury stock method. The dilutive effect of convertible securities is reflected in the diluted EPS by application of the “if-converted” meth od. The “if-converted” method is only assumed in periods where such application would be dilutive. In applying the “if-converted” method for diluted EPS, the Company would assume conversion of the 0.750% Convertible Senior Notes due 2024 (“2024 Notes”) at a ratio of 25.9182 shares of its common stock per $1,000 principal amount of the 2024 Notes. Assumed converted shares of the Company’s common stock are weighted for the period the 2024 Notes were outstanding. In applying the “if-converted” method for diluted EPS, t he Company would assume conversion of its 0% Convertible Senior Notes due 2026 at a ratio of 13.2933 shares of its common stock per $1,000 principal amount of such notes. See Note 8 – Convertible Senior Notes, Net of Current Portion and Capped Call Transactions for additional information about the 2024 Notes and 2026 Notes. The following table presents shares used in calculating basic and diluted EPS for the three months ended March 31, 2024 and 2023, as follows: Three Months Ended March 31, 2024 2023 (In thousands, except per share amounts) Net loss $ (35,631) $ (17,420) Weighted average number of shares outstanding, basic and diluted 88,081,654 75,774,812 Net loss per share, basic and diluted $ (0.40) $ (0.23) Further, the following securities were excluded from the computation of diluted EPS, as their effect would have been anti-dilutive: As of March 31, 2024 2023 Shares subject to outstanding common stock options and employee stock purchase plan 3,251,520 4,078,938 Restricted stock units 8,052,908 4,331,255 Earn-outs — 23,818,594 Conversion option of the 2024 Notes — 1,878,862 Conversion option of the 2026 Notes 6,879,283 6,879,283 Total 18,183,711 40,986,932 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company accounts for its segment information in accordance with the provisions of ASC 280-10, “Segment Reporting.” ASC 280-10 establishes annual and interim reporting standards for operating segments of a company. ASC 280-10 requires disclosures of selected segment-related financial information about products, major customers, and geographic areas based on the Company’s internal accounting methods. T he chief operating decision maker (“CODM”), who is the Company’s Chief Executive Officer, evaluates performance, makes operating decisions, and allocates resources based on the financial information presented on a consolidated basis. Accordingly, management has determined that the Company operates as one operating and reportable segment. The Company was previously organized into two operating segments for purposes of making operating decisions and assessing performance: the Business segment and the Consumer segment. During the first quarter of 2023, the Consumer segment (consisting solely of the Kasamba business) was divested. As a result, the divestiture of Kasamba eliminated the Company’s Consumer segment. See Note 19 – Divestiture for additional information. Geographic Information The Company is domiciled in the United States and has international operations around the globe. The following table presents the Company’s long-lived assets by geographic region as of March 31, 2024 and December 31, 2023: March 31, December 31, 2024 2023 (In thousands) United States $ 430,731 $ 438,420 Germany 41,778 45,424 Australia 11,865 11,660 Netherlands 5,843 5,863 Other (1) 13,135 12,438 Total long-lived assets $ 503,352 $ 513,805 —————————————— (1) United Kingdom, Japan, France, Italy, Spain, Canada, and Singapore |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets, Net Goodwill Goodwill represents the excess of the aggregate purchase price over the fair value of net identifiable assets acquired in a business combination. Goodwill is not amortized, but is tested for impairment at the reporting unit level using either a qualitative or quantitative assessment on an annual basis, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. In the valuation of goodwill, management must make assumptions regarding estimated future cash flows to be derived from the Company’s business. If these estimates or their related assumptions change in the future, the Company may be required to record impairment for these assets. The changes in the carrying amount of goodwill as of March 31, 2024 and December 31, 2023 are as follows: Consolidated (In thousands) Balance as of December 31, 2022 $ 296,214 Adjustments to goodwill: Goodwill impairment (1) (11,895) Foreign exchange adjustment 1,312 Balance as of December 31, 2023 $ 285,631 Adjustments to goodwill: Goodwill impairment (1) (3,627) Foreign exchange adjustment (1,048) Balance as of March 31, 2024 $ 280,956 (1) These amounts represent the entire accumulated goodwill impairment balance as of March 31, 2024. As a result of the Company’s intention to sell or dispose of its WildHealth reporting unit, the Company recorded a non-cash impairment charge of $3.6 million in the condensed consolidated statements of operations during the three months ended March 31, 2024, to recognize a full impairment of goodwill associated with its WildHealth reporting unit. There were no impairments in the Company’s Business reporting unit during the three months ended March 31, 2024. There were no impairments of goodwill during the three months ended March 31, 2023. Intangible Assets, Net Intangible assets are summarized as follows: March 31, 2024 Gross Accumulated Net Carrying Amount Weighted (In thousands) (In years) Amortizing intangible assets: Technology $ 94,562 $ (65,107) $ 29,455 5.0 Customer relationships 32,060 (20,057) 12,003 10.0 Patents 15,895 (2,066) 13,829 12.9 Trademarks 1,404 (761) 643 5.0 Trade names 1,044 (1,044) — 2.8 Other 914 (835) 79 4.1 Total $ 145,879 $ (89,870) $ 56,009 December 31, 2023 Gross Accumulated Net Carrying Amount Weighted (In thousands) (In years) Amortizing intangible assets: Technology $ 94,549 $ (60,465) $ 34,084 5.0 Customer relationships 32,025 (19,542) 12,483 10.0 Patents 15,350 (1,916) 13,434 12.9 Trademarks 1,400 (707) 693 5.0 Trade names 1,044 (672) 372 2.8 Other 914 (355) 559 4.1 Total $ 145,282 $ (83,657) $ 61,625 Amortization expense is calculated over the estimated useful life of the asset. Aggregate amortization expense for intangible assets and finance leases, net was $4.2 million and $5.4 million for the three months ended March 31, 2024 and 2023, respectively. Amortization expense included in cost of revenue in our condensed consolidated statements of operations was $3.3 million and $4.6 million for the three months ended March 31, 2024 and 2023, respectively. As a result of our impairment test in the first quarter of 2024, the Company recognized an immaterial non-cash impairment charge of $2.2 million included in impairment of intangibles and other assets in the condensed consolidated statements of operations, related to intangible assets associated with its WildHealth reporting unit, due to a plan to sell or dispose of the WildHealth reporting unit, as discussed above. There were no impairments of intangible assets during the three months ended March 31, 2023. As of March 31, 2024, estimated annual amortization expense for the next five years and thereafter is as follows: Estimated Amortization Expense (In thousands) Remainder of 2024 $ 11,567 2025 14,996 2026 12,160 2027 1,004 2028 821 Thereafter 15,461 Total $ 56,009 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation, and amortization. Depreciation and amortization is calculated using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the asset. The Company reviews the estimated useful lives of its property and equipment on an ongoing basis. The following table presents the detail of property and equipment, net for the periods presented: March 31, December 31, Useful life (In thousands) (In years) Internal-use software development costs $ 186,746 $ 181,079 5 Computer equipment and software 126,728 123,580 3 to 5 Furniture, equipment and building improvements 329 327 The lesser of 5 or estimated useful life Finance lease right-of-use assets 128 3,060 2 Property and equipment, at cost 313,931 308,046 Less: accumulated depreciation (196,038) (188,721) Property and equipment, net $ 117,893 $ 119,325 Depreciation and amortization expense of property and equipment was $8.2 million and $7.4 million during the three months ended March 31, 2024 and 2023, respectively. Expenditures for routine maintenance and repairs are charged to operating expense as incurred. Major renewals and improvements are capitalized and depreciated over their estimated useful lives. There were no impairments of property and equipment during the three months ended March 31, 2024 and 2023. Total depreciation included in our condensed consolidated statements of operations for the three months ended March 31, 2024 and 2023 is as follows: March 31, March 31, (In thousands) Cost of revenue $ 1,682 $ 2,247 Sales and marketing 900 726 General and administrative 158 161 Product development 5,485 4,228 Total $ 8,225 $ 7,362 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities The following table presents the detail of accrued expenses and other current liabilities for the periods presented: March 31, December 31, (In thousands) Professional services and consulting and other vendor fees $ 56,593 $ 67,585 Payroll and other employee-related costs 13,214 20,767 Finance lease liability 104 3,037 Restructuring 1,808 2,076 Sales commissions 1,645 734 Non-income tax 556 556 Other 1,586 2,269 Total $ 75,506 $ 97,024 |
Convertible Senior Notes and Ca
Convertible Senior Notes and Capped Call Transactions | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Convertible Senior Notes and Capped Call Transactions | Convertible Senior Notes, Net of Current Portion and Capped Call Transactions Convertible Senior Notes due 2024 and Capped Calls In March 2019, the Company issued $230.0 million aggregate principal amount of its 0.750% Convertible Senior Notes due 2024 (the “2024 Notes”) in a private placement. Interest on the 2024 Notes was payable semi-annually in arrears on March 1 and September 1 of each year. The 2024 Notes matured on March 1, 2024, on which date the Company repaid in full the outstanding $72.5 million in aggregate principal amount of the 2024 Notes. On March 21, 2023, the Company entered into individual privately negotiated transactions (the “Note Repurchase Agreements”) with certain holders of its 2024 Notes, pursuant to which the Company agreed to pay an aggregate of approximately $149.7 million in cash for the repurchase of approximately $157.5 million in aggregate principal amount of the 2024 Notes (the “Note Repurchases”). D uring the first quarter of 2023, the Company recognized a $6.1 million gain, net of transaction costs of $0.5 million on debt extinguishment, which represented the difference between the carrying value and the fair value of the 2024 Notes just prior to the Note Repurchases, which was recorded in Other (expense) income, net in the condensed consolidated statements of operations. The gain on debt extinguishment was subsequently adjusted by an immaterial amount of $1.1 million with a total gain of $7.2 million reported as of December 31, 2023. Upon completion of the Note Repurchases, the aggregate principal amount of the 2024 Notes was reduced by $157.5 million to $72.5 million and the carrying amount of the 2024 Notes reduced by $228.3 million to $72.0 million. A corresponding portion of the 2024 capped calls were terminated in connection following the Note Repurchases as required by their terms for minimal consideration. As of March 31, 2024 , there was no outstanding principal amount of the 2024 Notes. Convertible Senior Notes due 2026 and Capped Calls In December 2020, the Company issued $517.5 million aggregate principal amount of its 0% Convertible Senior Notes due 2026 (the “2026 Notes” and together with the 2024 Notes, the “Notes”) in a private placement. The 2026 Notes will mature on December 15, 2026, unless earlier repurchased or redeemed by the Company or converted pursuant to their terms. The total net proceeds from the offering of the 2026 Notes, after deducting debt issuance costs, was approximately $505.3 million. Each $1,000 in principal amount of the 2026 Notes is initially convertible into 13.2933 shares of the Company’s common stock par value $0.001, which is equivalent to an initial conversion price of approximately $75.23 per share. The conversion rate is subject to adjustment upon the occurrence of certain specified events but will not be adjusted for any accrued and unpaid special interest. In addition, following certain corporate events that occur prior to the maturity date, the Company will increase the conversion rate for a holder who elects to convert its 2026 Notes in connection with such a corporate event. The 2026 Notes are not redeemable prior to the maturity date of the 2026 Notes and no sinking fund is provided for the 2026 Notes. If the Company undergoes a fundamental change (as defined in the indenture governing the 2026 Notes), which includes the failure of our common stock to be listed or quoted on any of the Nasdaq Global Select Market, The Nasdaq Global Market or the New York Stock Exchange, holders may require the Company to repurchase for cash all or any portion of their 2026 Notes in principal amounts of $1,000 or a multiple thereof at a fundamental change repurchase price equal to 100% of the principal amount of the 2026 Notes to be repurchased, plus accrued and unpaid special interest to, but excluding, the fundamental change repurchase date. Holders of the 2026 Notes may convert their 2026 Notes at their option at any time prior to the close of business on the business day immediately preceding August 15, 2026, in multiples of $1,000 principal amount, only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2021 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price for the 2026 Notes on each applicable trading day as determined by the Company; (2) during the five five During the three months ended March 31, 2024, the conditions allowing holders of the 2026 Notes to convert were not met. The 2026 Notes are senior unsecured obligations of the Company. As a result of the adoption of ASU 2020-06, the 2026 Notes are accounted for as a single liability, and the carrying amount of the 2026 Notes is $512.1 million as of March 31, 2024, consisting of principal of $517.5 million, net of unamortized issuance costs of $5.4 million. The 2026 Notes were classified as long term liabilities in the accompanying condensed consolidated balance sheets as of March 31, 2024. The remaining term over which the 2026 Notes’ debt issuance costs will be amortized is 2.7 years at an effective interest rate of 0.40% for the three months ended March 31, 2024. In connection with the offering of the 2026 Notes, the Company entered into privately-negotiated capped call option transactions with certain counterparties (the “2026 capped calls”). The 2026 capped calls each have an initial strike price of approximately $75.23 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2026 Notes. The 2026 capped calls have initial cap prices of $105.58 per share, subject to certain adjustment events. The 2026 capped calls cover, subject to anti-dilution adjustments, approximately 6.88 million shares of common stock. The 2026 capped calls are generally intended to reduce or offset the potential dilution to the common stock upon any conversion of the 2026 Notes with such reduction or offset, as the case may be, subject to a cap based on the cap price. The 2026 capped calls expire on December 15, 2026, subject to earlier exercise. The 2026 capped calls are subject to either adjustment or termination upon the occurrence of specified extraordinary events affecting the Company, including a merger event, a tender offer, and a nationalization, insolvency or delisting involving the Company. In addition, the 2026 capped calls are subject to certain specified additional disruption events that may give rise to a termination of the 2026 capped calls, including changes in law, failure to deliver, and hedging disruptions. The 2026 capped calls are recorded in stockholders’ equity and are not accounted for as derivatives. The net cost of $46.1 million incurred to purchase the 2026 capped calls was recorded as a reduction to additional paid-in capital in the accompanying condensed consolidated balance sheets. Unamortized debt issuance costs incurred in connection with securing the Company’s financing arrangements are presented in the condensed consolidated balance sheets as a direct deduction from the carrying amount of the outstanding borrowings, consistent with debt discounts. All deferred financing costs are amortized to interest expense. The net carrying amount of the liability component of the Notes as of March 31, 2024 and December 31, 2023 is as follows: March 31, December 31, (In thousands) Principal $ 517,500 $ 589,992 Unamortized issuance costs (5,424) (6,034) Total net carrying value $ 512,076 $ 583,958 Less: short-term debt, net — 72,393 Long-term debt, net $ 512,076 $ 511,565 The following table sets forth the interest expense recognized related to the Notes: Three Months Ended March 31, 2024 2023 (In thousands) Contractual interest expense $ 91 $ 441 Amortization of debt issuance costs 610 920 Total interest expense $ 701 $ 1,361 Interest expense of $0.7 million |
Leases
Leases | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Leases | Leases The Company has non-cancelable operating and finance leases for its corporate offices and other service agreements. Its leases have remaining lease terms of less than one The Company continues to actively assess its global lease portfolio. However, any additional de-recognition of ROU assets and incurrence of various one-time expenses in connection with early termination of additional leases are not expected to be material to its financial condition or results of operations. Supplemental cash flow information related to leases for the periods ended March 31, 2024 and 2023 is as follows: Three Months Ended March 31, 2024 2023 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 842 $ 974 Operating cash flows for finance leases 18 24 Financing cash flows for finance leases 327 958 The components of lease costs for the periods ended March 31, 2024 and 2023 are as follows: Three Months Ended March 31, 2024 2023 (In thousands) Finance lease cost Amortization of right of use assets $ 334 $ 911 Interest 18 24 Operating lease cost 2,902 2,740 Total lease cost $ 3,254 $ 3,675 March 31, March 31, Weighted Average Remaining Lease Term: Operating leases 2.0 years 1.7 years Finance leases 1.6 years 1.0 year Weighted Average Discount Rate: Operating leases 7 % 7 % Finance leases 7 % 4 % Supplemental balance sheet information related to leases is as follows: Financial Statement Classification March 31, December 31, (In thousands) Assets Operating right-of-use assets Operating lease right-of-use assets $ 3,431 $ 4,135 Finance right-of-use assets Property and equipment, net 128 3,060 Liabilities Current liabilities: Operating lease liabilities Operating lease liabilities $ 2,632 $ 2,719 Finance lease liabilities Accrued expenses and other current liabilities 104 3,037 Non-current liabilities: Operating lease liabilities Operating lease liabilities, net of current portion 1,466 2,173 Finance lease liabilities Other liabilities 55 85 Future minimum lease payments under non-cancellable operating and finance leases (with an initial or remaining lease term in excess of one year) are as follows: March 31, 2024 Operating Finance (In thousands) 2024 (remaining nine months for March 31, 2024) $ 2,186 $ 83 2025 1,689 83 2026 316 — 2027 172 — 2028 86 — Thereafter — — Total minimum lease payments 4,449 166 Less: present value adjustment (351) (7) Present value of lease liabilities $ 4,098 $ 159 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company measures its cash equivalents at fair value based on an expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Inputs reflect: quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means. • Level 3: Unobservable inputs reflecting the Company’s assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available. Financial Assets and Liabilities The carrying amount of cash, accounts receivable, and accounts payable approximate their fair value due to their short-term nature. The Company’s assets and liabilities that are measured at fair value on a recurring basis, by level, within the fair value hierarchy as of March 31, 2024 and December 31, 2023, are summarized as follows: March 31, 2024 Level 1 Level 2 Level 3 Total (In thousands) Assets Cash equivalents: Money market funds $ 84,990 $ — $ — $ 84,990 Total assets $ 84,990 $ — $ — $ 84,990 December 31, 2023 Level 1 Level 2 Level 3 Total (In thousands) Assets Cash equivalents: Money market funds $ 174,701 $ — $ — $ 174,701 Total assets $ 174,701 $ — $ — $ 174,701 In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible as well as considers counterparty credit risk in its assessment of fair value. Observable or market inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s assumptions based on the best information available. The Company’s money market funds are measured at fair value on a recurring basis based on quoted market prices in active markets and are classified as Level 1 within the fair value hierarchy. The Company’s contingent earn-out liability was measured at fair value on a recurring basis and was classified as Level 3 within the fair value hierarchy. For 2 023, the fair value was based on the negotiated contracts with the selling shareholders. Significant changes in unobservable inputs could result in significantly lower or higher fair value measurements. On a nonrecurring basis, the Company uses fair value measures when analyzing asset impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If it is determined such indicators are present and the review indicates that the assets will not be fully recoverable, based on undiscounted estimated cash flows over the remaining amortization periods, their carrying values are reduced to estimated fair value. The Company uses an income approach and inputs that constitute Level 3. The estimated fair value of outstanding balances of our 2024 Notes and 2026 Notes are as follows: Level of Hierarchy Fair Value Principal Balance Unamortized Issuance Costs Net Carrying Value (In thousands) March 31, 2024 2026 Notes 2 $ 367,497 $ 517,500 $ (5,424) $ 512,076 December 31, 2023 2024 and 2026 Notes 2 $ 435,883 $ 589,992 $ (6,034) $ 583,958 Management determines the fair value by using Level 2 inputs base d on antithetic variable technique don e by an independent valuation specia list. Refer to Note 8 – Convertible Senior Notes, Net of Current Portion and Capped Call Transactions for additional information. The Company did not have Level 3 liabilities during the three months ended March 31, 2024. The changes in fair value of the Level 3 liabilities during the annual period ended December 31, 2023 are as follows: December 31, Balance, beginning of year $ 72,221 Additions in the period — Change in fair value of contingent consideration 4,629 Change in fair value of liability awards (27,857) Payments (48,993) Balance, end of year $ — Certain former stakeholders of the Company’s acquisitions were eligible to receive additional cash or share considerations based on the attainment of certain operating metrics in the periods subsequent to the acquisitions. These earn-out arrangements were accounted for as either contingent considerations arrangements or compensation arrangements. Contingent considerations were fair valued using significant inputs that are not observable in the market. The earn-outs determined to be compensatory were remeasured each reporting period based on whether the performance targets were probable of being achieved and recognized over the related service periods. During the year ended December 31, 2023, the Company settled the VoiceBase, Tenfold and e-Bot7 and WildHealth, Inc. earn-outs for approximately $19.9 million, $9.3 million, $7.7 million, and $12.0 million, respectively. Changes to the fair value of the earnouts were recognized as a component of stock-based compensation expense and other income (expense), net in the accompanying condensed consolidated statements of operations. Payments in cash were recognized as a component of compensation expense and payments in stock were recognized as a component of equity in the accompanying condensed consolidated statements of operations. There were no outstanding earnout liabilities as of March 31, 2024 based on settlements that were completed as of December 31, 2023. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Employee Benefit Plans The Company has a 401(k) defined contribution plan covering all eligible employees. The Company’s 401(k) policy is a Safe Harbor Plan, whereby the Company matches 100% of the first 3% of eligible compensation and 50% of the next 2% of eligible compensation. Furthermore, the match is immediately vested. Salaries and related expenses include $1.1 million and $1.4 million of employer matching contributions for the three months ended March 31, 2024 and 2023, respectively. Letters of Credit As of March 31, 2024, the Company had letters of credit totaling $0.5 million outstanding as a security deposit for the due performance by the Company of the terms and conditions of a supply contract. Contractual obligations The Company’s purchase obligations consist of agreements to purchase goods and services entered into in the ordinary course of business. These purchase obligation agreements are primarily related to contracts with vendors in connection with Information Technology (“IT”) infrastructure and cloud computing-related services with remaining terms of two years or less. Our contractual obligations as of March 31, 2024, did not materially change from the amounts disclosed in our 2023 Annual Report on Form 10-K. Indemnifications The Company enters into service and license agreements in its ordinary course of business. Pursuant to some of these agreements, the Company agrees to indemnify certain customers from and against certain types of claims and losses suffered or incurred by them as a result of using the Company’s products. The Company also has agreements whereby its executive officers and directors are indemnified for certain events or occurrences while the officer or director is, or was, serving at the Company’s request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a directors and officers insurance policy that reduces its exposure and enables the Company to recover a portion of any future amounts paid subject to customary deductibles. As a result of its insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal. The Company has no liabilities recorded for these agreements as of March 31, 2024 and December 31, 2023. Non-Income Related Taxes The Company is subject to sales tax liabilities, plus applicable interest, for states in which it has an economic nexus. The accru al balance for sales tax liabilities included within the condensed consolidated balance sheets was $0.6 million as of March 31, 2024 and December 31, 2023. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Stock-Based Compensation The Company’s stock-based compensation generally includes stock options, restricted stock units (“RSUs”), performance-vesting restricted stock units (“PRSUs”), and purchases under the Company’s 2019 Employee Stock Purchase Plan. Stock-based compensation expense related to RSUs is based on the market value of the underlying stock on the date of grant and the related expense is recognized ratably over the requisite service period. The stock-based compensation expense related to PRSUs is estimated at the grant date based on the expectation that performance goals will be achieved at the stated target level. The amount of compensation cost recognized depends on the relative satisfaction of the performance condition based on performance to date. Stock Option Plans The Company’s 2019 Stock Incentive Plan became effective on April 11, 2019. The 2019 Stock Incentive Plan, as amended and restated, allows the Company to grant incentive stock options and restricted stock units to its employees and directors to participate in the Company’s future performance through stock-based awards at the discretion of the board of directors. The number of shares authorized for issuance as of March 31, 2024 was 42,367,744 shares in the aggregate. Options to acquire common stock granted thereunder have ten-year terms. As of March 31, 2024, 2,286,084 shares of common stock remained available for issuance (taking into account all option exercises and other equity award settlements through March 31, 2024). Employee Stock Purchase Plan As of March 31, 2024, there were 2,000,000 shares authorized and reserved for issuance under the 2019 ESPP. As of March 31, 2024, 948,453 shares of common stock remained available for issuance under the ESPP (taking into account all share purchases through March 31, 2024). Inducement Plan There are 11,459,009 shares of common stock authorized and reserved for issuance under the 2018 Inducement Plan. On March 8, 2024, the Company’s board of directors amended the plan and authorized 5,300,000 new shares for issuance. As of March 31, 2024, 5,994,216 shares of common stock remained available for issuance under the Inducement Plan (taking into account all option exercises and other equity award settlements through March 31, 2024). Stock Option Activity The following table is a summary of the Company’s stock option activity for the three months ended March 31, 2024: Stock Option Activity Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Options Weighted Balance outstanding at December 31, 2023 3,137 $ 22.68 4.84 $ 40 Granted 1,000 (1) 1.02 Exercised — — Cancelled or expired (885) 23.65 Balance outstanding at March 31, 2024 3,252 15.75 5.99 3 Options vested and expected to vest 647 9.30 3.71 — Options exercisable at March 31, 2024 1,977 $ 21.56 9.35 $ 3 (1) Represents a stock option award, granted to the Company’s new Chief Executive Officer, to acquire shares of the Company’s common stock that will vest upon the satisfaction of certain performance-based and time-based vesting conditions. This award, provided for under the terms of the Chief Executive Officer’s employment agreement, was approved by the Compensation Committee of the Company’s board of directors (the “Board”) as a standalone inducement award under applicable Nasdaq rules and does not count against the number of shares reserved for issuance under the Company’s 2019 Stock Incentive Plan or the Company’s 2018 Inducement Plan. As of March 31, 2024, there was approximately $2.8 million of total unrecognized compensation cost related to nonvested share-based compensation arrangements. That cost is expected to be recognized over a weighted average period of approximately 1.9 years. Restricted Stock Unit and Performance-Vesting Restricted Stock Unit Activity The following table is a summary of the Company’s RSUs and PRSUs activity for the three months ended March 31, 2024: Number of Shares Weighted Average Grant Date Fair Value Aggregate Fair Value (In thousands) (Per share) (In thousands) Balance outstanding at December 31, 2023 5,064 $ 12.53 $ 19,193 Awarded 3,893 1.17 Vested (433) 16.94 Forfeited (471) 16.61 Non-vested and outstanding at March 31, 2024 8,053 6.56 7,879 Expected to vest 5,285 $ 7.02 $ 5,153 RSUs granted to employees generally vest over a three PRSUs granted are generally subject to both a service-based vesting condition and a performance-based vesting condition. PRSUs will vest upon the achievement of specified performance targets and subject to continued service through the applicable vesting dates. The associated compensation cost is recognized over the requisite service period when it is probable that the performance condition will be satisfied. There were no PRSUs granted during the three months ended March 31, 2024. PRSUs grant ed during the three months ended March 31, 2023 were immaterial. Total stock-based compensation costs included in our condensed consolidated statements of operations for the three months ended March 31, 2024 and 2023 are as follows: Three Months Ended March 31, 2024 2023 (In thousands) Cost of revenue $ 343 $ 2,035 Sales and marketing 2,455 2,404 General and administrative 1,798 2,632 Product development 2,962 4,261 Total $ 7,558 $ 11,332 |
Restructuring
Restructuring | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring During the second quarter of 2022, LivePerson began a restructuring initiative to realign the Company’s cost structure to better reflect significant product and business model innovation and then-recent changes due to acquisitions and factors outside the control of the Company. As part of the restructuring initiative, the Company reoriented its global product and engineering organization for greater efficiency and focus, and reallocated some spending to increase its investment in customer success and go-to-market initiatives. In 2023, due to the changing technology landscape related to the evolution of LLMs, we were able to identify opportunities for significant cost savings because the latest generation of LLMs is able to build a bot in minutes, enabling reduction of headcount previously devoted to bot-building. Additionally, we have moved to a product-led growth structure where we flattened the organization to align to more efficient sales and service support ratios. In connection with the restructuring initiatives, the Company recognized restructuring costs of $3.3 million and $11.5 million during the three months ended March 31, 2024 and 2023, respectively, which is included in restructuring costs in the accompanying condensed consolidated statements of operations. Such costs primarily include severance and other compensation costs as well as IT infrastructure contract termination costs. The following table presents the detail of the liability for the Company’s restructuring charges, which is included within accrued expenses and other current liabilities within the accompanying condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023: March 31, December 31, (In thousands) Balance, beginning of the year $ 2,076 $ 803 IT contract termination costs 715 5,744 Severance and other compensation associated costs 2,594 16,920 Cash payments (3,577) (21,391) Balance, end of period $ 1,808 $ 2,076 The Company anticipates that payments associated with the employee severance and other compensation associated costs reflected in the table above will be substantially completed by December 31, 2024. The following table presents the detail of expenses for the Company’s restructuring charges for the three months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 2023 (In thousands) Lease restructuring costs $ — $ 1 IT contract termination costs 715 — Severance and other associated costs 2,594 11,514 Total restructuring costs $ 3,309 $ 11,515 |
Legal Matters
Legal Matters | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Matters | Legal Matters Stockholder Litigation In December 2023, a putative stockholder class action entitled Damri v. LivePerson, Inc., No. 1:23-cv-10517, was filed under the federal securities laws against the Company, its former Chief Executive Officer, and its Chief Financial Officer in the United States District Court for the Southern District of New York. The complaint alleges that the Company’s Form 10-Q filings and forecasts for the first, second, and third quarters of fiscal year 2022 were false and misleading in violation of Section 10(b) of the Securities Exchange Act of 1934, based on the Company’s later disclosures and report on Form 10-K on March 16, 2023. A parallel litigation on behalf of stockholders who purchased their shares on the Tel Aviv Stock Exchange, entitled Weissbrod v. LivePerson, Inc., is pending in the Tel Aviv District Court in Israel, but has been stayed pending further developments in the Damri case. In January 2024, a purported derivative action entitled Marti v. LoCascio, No. 1:24-cv-00598, was filed in the United States District Court for the Southern District of New York by a purported stockholder of the Company against the Company’s former Chief Executive Officer, its Chief Financial Officer, most of the members of the current board of directors and several former directors. The derivative litigation claims that the Company itself was harmed by the same acts and omissions underlying the Damri federal securities lawsuit, and seeks to recover unspecified losses on behalf of the Company. The Marti case is stayed pending further developments in the Damri case . I n January 2024, a purported stockholder of the Company filed a lawsuit against the Company and its Board of Directors entitled Browne v. Layfield, No. 2024-0079, in the Court of Chancery of the State of Delaware. The complaint asserted a claim for breach of fiduciary duty based upon a Tax Benefits Preservation Plan. In February 2024, the Board approved technical amendments to the Tax Benefits Preservation Plan which were filed by the Company on Form 8-K, and the case was dismissed as moot, subject to attorneys’ fees on behalf of the plaintiff. In February 2024, Starboard Value LP and several of its related entities and investment funds filed a lawsuit against the Company, its former Chief Executive Officer and its Chief Financial Officer entitled Starboard Value LP v. LivePerson, Inc., No. 2024-0103, in the Court of Chancery of the State of Delaware. The complaint alleges common law fraud, fraudulent inducement and negligent misrepresentation in connection with an alleged scheme to induce Starboard to settle its 2022 proxy contest against the Company and, as stated in the complaint, involves previous Starboard allegations of misrepresentations in the Company's public disclosures that the Company previously informed Starboard were found to be unsubstantiated following an independent investigation. The complaint seeks unspecified damages. The defendants have filed an answer denying the substantive allegations of the compliant. COVID-Related Matters As has been widely reported, there is heightened scrutiny by the federal government across many programs related to global novel coronavirus disease (“COVID-19”) that were introduced during the COVID-19 pandemic. The Company previously provided products and services related to COVID-19 testing and accompanying software. Those products and services have been the subject of inquiry and review by Medicare, the Department of Justice and the U.S. Food and Drug Administration. The Company has discontinued all products and services related to COVID-19, and has responded to and intends to continue to cooperate with governmental inquiries related to its previous engagement in COVID-19 related product and service offerings. Other Legal, Administrative, Governmental and Regulatory Matters From time to time, the Company is or may be subject to or involved in legal, administrative, governmental and/or regulatory proceedings, inquiries and investigations as well as actual or threatened litigation, claims and/or demands (each an “Action” and collectively “Actions”). These have included and may include (without limitation) Actions brought by or against the Company, its affiliates, subsidiaries, directors and/or officers with respect to intellectual property, contracts, financial, commercial, employment, legal, compliance, privacy, data security, regulatory and/or other matters related to our business, as well as Actions brought against the Company’s customers for which the Company has a contractual indemnification obligation. Regardless of the outcome, Actions can have an adverse impact on the Company because of defense and/or settlement costs, diversion of management resources, reputational risks and other factors. Accruals The Company accrues for certain contingencies when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated and discloses certain contingencies for which no accrual has been made as appropriate and in compliance with ASC 450, “Contingencies”. Significant judgment is required in both the determination of probability and the determination as to whether a loss is reasonably estimable. The accruals or estimates, if any, resulting from the foregoing analysis, are reviewed at least quarterly and adjusted to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular matter. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences are expected to become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. The Company includes interest accrued on the underpayment of income taxes and certain interest expense and penalties, if any, related to unrecognized tax benefits as a component of the income tax provision. The Company maintains a valuation allowance against its U.S., e-bot7 Germany and Bulgaria deferred tax assets as it considered its cumulative losses in recent years as a significant piece of negative evidence. Since valuation allowances are evaluated by jurisdiction, the Company believes that the deferred tax assets related to LivePerson Australia Pty. Ltd., Engage Pty. Ltd., LivePerson (UK) Ltd., LivePerson Japan, and LivePerson Ltd. (Israel) are more likely than not to be realized as these jurisdictions have positive cumulative pre-tax book income after adjusting for permanent and one-time items. During the year ended December 31, 2023, there was an increase in the valuation allowance recorded of $23.7 million. For the three months ended March 31, 2024, the Company recorded a tax provision o f $0.4 million. This entire amount consists of a tax pro vision on operating earnings of non-U S subsidiaries and interest accrual on unrecognized tax benefits in Israel. The Company had a valuation allowance on certain deferred tax assets for the year ended December 31, 2023 of $211.2 million. Inherent in the Company’s 2024 annual effective tax rate is an estimated increase in the valuation allowance of $24.9 million, al l of which would be recorded as an expense. During 2023, an increase in the valuation allowance in the amount of $23.7 million was recorded as an expense. |
Equity Method Investments
Equity Method Investments | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | Equity Method Investment On February 13, 2022, the Company and Pasaca Capital Inc. (“Pasaca”) entered into a joint venture agreement (the “JV Agreement”) to form Claire Holdings, Inc. (“Claire”), a joint venture to build, create, and administer a marketplace for health and well-being diagnostic testing. Pursuant to the terms of the JV Agreement, the Company agreed to contribute a total of $19.0 million over a five-year period in exchange for a 19.2% ownership interest in Claire. Pasaca agreed to contribute $80.0 million to Claire over a five-year period in exchange for an 80.8% ownership interest in Claire. The Company accounts for its 19.2% interest in Claire using the equity method of accounting. The Company recorded its ownership percentage of losses of Claire in Other income (expense), net in the amount of $0.6 million for the three months ended March 31, 2023. The Company’s equity method investment in joint venture was reduced to zero during the prior year, based on the prior year losses, and remained at zero on the condensed consolidated balance sheet as of March 31, 2024. Refer to Note 18 – Related Parties for additional information. |
Variable Interest Entity
Variable Interest Entity | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Variable Interest Entities The Company prepares its condensed consolidated financial statements in accordance with ASC 810, “Consolidation”, which provides for the consolidation of variable interest entities (“VIEs”) of which the Company is the primary beneficiary. In February 2022, the Company acquired WildHealth as well as certain variable interests that WildHealth has in four Professional Corporations (“PCs”). The PCs are owned by a medical practitioner in accordance with certain state laws which restrict the corporate practice of medicine and require medical practitioners to own such entities. WildHealth provides management and other services to the PCs in exchange for a management fee and provides financial support to the PCs through a revolving credit arrangement. WildHealth also has separate agreements with the equity holder of the PCs where it may acquire and assign such equity interests for certain PCs. The agreement entitles WildHealth to control rights sufficient to require the Company to consolidate the balance sheet and results of operations of the PCs as VIEs. The Company determined that the PCs are VIEs as WildHealth is the primary beneficiary of the PCs. The assets, liabilities, revenues, and operating results of the VIEs after elimination of intercompany transactions were not material as of and for the three months ended March 31, 2024. |
Related Parties
Related Parties | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties Related parties are defined as entities related to the Company’s directors or main sha reholders as well as equity method affiliates. During the year ended December 31, 2023, the Company provided services to Claire, an equity method affiliate (refer to Note 16 – Equity Method Investment for additional information on the equity method affiliate) in exchange for fees through certain commercial arrangements. These arrangements facilitated Claire’s build out and operations. In connection with the JV Agreement, the Company entered into commercial agreements with Claire, under which the Company agreed to provide custom software development and managed services in exchange for fees governed by the terms and conditions set forth therein. In accordance with guidance under ASC 606, Claire is considered a customer of the Company. No revenues were recognized for the services provided to Claire included in the Company’s condensed consolidated statements of operations for the three months ended March 31, 2024, compared to revenues of $3.8 million for the three months ended March 31, 2023. As of March 31, 2024, the Company has accounts receivable of $2.1 million included in the Company’s condensed consolidated balance sheet, which is fully recognized in its allowance for credit losses. Total accounts receivable of $2.1 million as of December 31, 2023 was included in the Company’s condensed consolidated balance sheet, for which the Company recognized $1.5 million in its allowance for credit losses. |
Divestiture
Divestiture | 3 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Divestiture | Divestiture Fiscal 2023 Divestitures In the fourth quarter of 2022, the Company entered into a non-binding Letter of Intent to divest Kasamba, Inc. and Kasamba LTD (together “Kasamba”), which represented the Company’s Consumer segment. Pursuant to ASC Subtopic 360-10, “Impairment or Disposal of Long-Lived Assets”, t he Company applied held for sale accounting treatment to the assets and liabilities of Kasamba. Accordingly, the related net assets were separately presented in current assets and current liabilities as held for sale on the consolidated balance sheets as of December 31, 2022, up until the close of the transaction . The held for sale classification also resulted in ceasing depreciation and amortization on the designated assets. The Share Purchase Agreement between Ingenio, LLC (“Ingenio”) and the Company closed on March 20, 2023. In accordance with the Share Purchase Agreement, the Company sold all of the issued and outstanding shares of Kasamba for $16.9 million which was received in cash upon closing; and $2.6 million deferred payment to be received within a year of the close transaction date, which was included in prepaid expenses and other current assets on the Company’s condensed consolidated balance sheets as of March 31, 2023. $11.8 million was required to be held in various escrow accounts for up to 15 months, and was included in restricted cash on the Company’s consolidated balance sheets; however, $9.8 million of this escrow amount was released as of December 31, 2023. The transaction resulted in a gain of $17.6 million, which was recognized and presented separately as a gain on divestiture on the Company’s consolidated statements of operations during the year ended December 31, 2023. During the three months ended March 31, 2024, the Company recognized a post-closing adjustment pertaining to the final agreement in the amount of $1.8 million, which is recorded in General and administrative expenses in the condensed consolidated statement of operations. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net loss (in thousands) | $ (35,631) | $ (17,420) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 shares | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | Trading Arrangement Director/ Title Date of Adoption/Termination Rule 10b5-1 Trading Arrangement End Date Aggregate Number of Securities to be Purchased or Sold Bruce Hansen Director 3/12/2024 Yes 3/06/2025 34,045 upon vesting of RSUs. Alex Kroman Chief Product & Technology Officer 3/12/2024 Yes 3/07/2025 185,875 upon vesting of RSUs and performance share awards. |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Bruce Hansen [Member] | |
Trading Arrangements, by Individual | |
Name | Bruce Hansen |
Title | Director |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | 3/12/2024 |
Arrangement Duration | 359 days |
Aggregate Available | 34,045 |
Alex Kroman [Member] | |
Trading Arrangements, by Individual | |
Name | Alex Kroman |
Title | Chief Product & Technology Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | 3/12/2024 |
Arrangement Duration | 360 days |
Aggregate Available | 185,875 |
Description of Business and B_2
Description of Business and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements, and the financial data and other information disclosed in the notes to the condensed consolidated financial statements as of March 31, 2024 and for the three months ended March 31, 2024 are unaudited. In the opinion of management, the unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments necessary for a fair presentation of the Company’s condensed consolidated financial position, results of operations, comprehensive loss, and cash flows for the interim periods presented. The results of operations for any interim period are not necessarily indicative of the results of operations for any other future interim period or for a full fiscal year. The condensed consolidated balance sheet as of December 31, 2023 has been derived from audited consolidated financial statements at that date. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). These unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the year ended December 31, 2023 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 4, 2024. |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements reflect the operations of LivePerson and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of the condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates are based on information available as of the date of the condensed consolidated financial statements. On a regular basis, management evaluates these estimates and assumptions. Items subject to such estimates and assumptions include, but are not limited to: • stock-based compensation expense; • allowance for credit losses; • the period of benefit for deferred contract acquisition costs; • valuation of goodwill; • valuation and useful lives of other long-lived assets; • fair value of assets acquired and liabilities assumed in business combinations; • income taxes; and • recognition, measurement, and disclosure of contingent liabilities. As of the date of issuance of the financial statements, the Company is not aware of any material specific events or circumstances that would require it to update its estimates, judgments, or to revise the carrying values of its assets or liabilities. These estimates may change, as new events occur and additional information is obtained, and are recognized in the condensed consolidated financial statements as soon as they become known. Actual results could differ from those estimates and any such differences may be material to the Company’s condensed consolidated financial statements. |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2022-03, Fair Value Measurement (Topic 820), Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions to clarify that a contractual restriction on the sale of an equity security is not considered part of a unit of account of the equity security, and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The amendments also require the following disclosures for equity securities subject to the contractual sale restrictions: 1.) The fair value of equity securities subject to the contractual sale restrictions reflected on the balance sheet. 2.) The nature and remaining duration of the restriction(s). 3.) The circumstances that could cause a lapse in the restriction(s). This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within those financial years. The Company adopted this guidance on January 1, 2024, which did not have a material effect on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements On March 21, 2024, the FASB issued ASU 2024-01, Compensation—Stock Compensation (Topic 718): Scope Application of Profits Interest and Similar Awards , which provides illustrative guidance to help entities determine whether profits interest and similar awards should be accounted for as share-based payment arrangements within the scope of FASB Accounting Standards Codification (“ASC”) 718, “Compensation—Stock Compensation.” Specifically, the amendments in ASU 2024-01 add an illustrative example that includes four fact patterns to demonstrate how an entity should apply the scope guidance in paragraph 718-10-15-3 to determine whether a profits interest award should be accounted for in accordance with Topic 718. The guidance in ASU 2024-01 applies to all entities that issue profits interest awards as compensation to employees or non-employees in exchange for goods or services. The amendments in this update are effective for annual periods beginning after December 15, 2024, and interim periods within those annual periods. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. ASU 2024-01 should be applied either retrospectively or prospectively. The Company does not expect this this standard to have a material impact on its condensed consolidated financial statements and related disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The updated standard is effective for annual periods beginning after December 15, 2023. The Company is currently evaluating the potential impact of adopting this new guidance on its condensed consolidated financial statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which modifies the rules on income tax disclosures to require entities to disclose (1) specific categories in the rate reconciliation, (2) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (3) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. The guidance is effective for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted. The Company does not expect this standard to have a material impact on its condensed consolidated financial statements and related disclosures. In August 2023, the FASB issued ASU 2023-05, Business Combinations—Joint Venture Formations (Subtopic 805-60): Recognition and Initial Measurement , which addresses the accounting for contributions made to a joint venture, upon formation, in a joint venture’s separate financial statements. The amendments require certain joint ventures to apply a new basis of accounting upon formation by recognizing and initially measuring most of their assets and liabilities at fair value. The objectives of the amendments are to provide decision-useful information to investors and other allocators of capital in a joint venture’s financial statements and also to reduce diversity in practice. ASU 2023-05 is effective for both public and private joint venture entities with a formation date on or after January 1, 2025. Early adoption is permitted. Entities may elect to apply the guidance retrospectively to joint ventures with a formation date prior to |
Description of Business and B_3
Description of Business and Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure | The following table presents the detail of prepaid expenses and other current assets as of the dates presented: March 31, December 31, (In thousands) Prepaid software maintenance $ 6,065 $ 8,592 VAT receivable 4,168 4,399 Prepaid server maintenance 2,824 2,634 Prepaid - other 2,743 2,599 Other assets 5,154 8,757 Total prepaid expenses and other current assets $ 20,954 $ 26,981 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table presents the Company’s revenues disaggregated by revenue source: Three Months Ended March 31, 2024 2023 (In thousands) Revenue: Hosted services (1) $ 71,495 $ 87,338 Professional services 13,654 20,323 Total revenue $ 85,149 $ 107,661 (1) On March 20, 2023, the Company completed the sale of Kasamba and therefore ceased recognizing revenue related to Kasamba effective on the transaction close date. Further, this sale eliminated the entire Consumer segment, as a result of which revenue is presented within a single condensed consolidated segment. Hosted services includes $7.2 million of revenue for the three months ended March 31 2023, relating to Kasamba. |
Schedule of Revenue by Geographic Region | The following table presents the Company’s revenues attributable to domestic and foreign operations for the periods presented: Three Months Ended March 31, 2024 2023 (In thousands) United States $ 60,507 $ 68,509 Other Americas (1) 1,518 3,805 Total Americas 62,025 72,314 EMEA (2) (3) 14,221 16,182 APAC (4) 8,903 19,165 Total revenue $ 85,149 $ 107,661 —————————————— (1) Canada, Latin America and South America (2) Europe, the Middle East and Africa (“EMEA”) (3) Includes revenue from the United Kingdom of $10.7 million and $15.3 million for the three months ended March 31, 2024 and 2023, respectively. (4) Asia-Pacific (“APAC”) |
Schedule Of Receivables, Contract Acquisition Costs, And Deferred Revenue | The opening and closing balances of the Company’s accounts receivable, unbilled receivables, and deferred revenues are as follows: Accounts Receivable Unbilled Receivable Contract Acquisition Costs, Net (Non-current) Deferred Revenue (Current) Deferred Revenue (In thousands) Balance as of December 31, 2022 $ 53,468 $ 33,069 $ 43,804 $ 84,494 $ 174 Increase (decrease), net 6,914 (11,649) (6,450) (2,636) 9 Balance as of December 31, 2023 $ 60,382 $ 21,420 $ 37,354 $ 81,858 $ 183 Increase (decrease), net (6,177) (4,260) 1,972 10,556 (60) Balance as of March 31, 2024 $ 54,205 $ 17,160 $ 39,326 $ 92,414 $ 123 Amortization expense in connection with contract acquisition cost was approximately $4.9 million and $8.3 million for the three months ended March 31, 2024 and 2023, respectively. |
Schedule of Allowance for Uncollectible Accounts | The activity in the allowance for credit losses is as follows: March 31, December 31, (In thousands) Balance, beginning of year $ 9,290 9,239 Additions charged to costs and expenses 4,722 3,319 Deductions/write-offs (4,777) (3,268) Balance, end of period $ 9,235 $ 9,290 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Reconciliation of Shares Used in Calculating Basic and Diluted Earnings Per Share | The following table presents shares used in calculating basic and diluted EPS for the three months ended March 31, 2024 and 2023, as follows: Three Months Ended March 31, 2024 2023 (In thousands, except per share amounts) Net loss $ (35,631) $ (17,420) Weighted average number of shares outstanding, basic and diluted 88,081,654 75,774,812 Net loss per share, basic and diluted $ (0.40) $ (0.23) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | Further, the following securities were excluded from the computation of diluted EPS, as their effect would have been anti-dilutive: As of March 31, 2024 2023 Shares subject to outstanding common stock options and employee stock purchase plan 3,251,520 4,078,938 Restricted stock units 8,052,908 4,331,255 Earn-outs — 23,818,594 Conversion option of the 2024 Notes — 1,878,862 Conversion option of the 2026 Notes 6,879,283 6,879,283 Total 18,183,711 40,986,932 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Long-Lived Assets by Geographic Region | The Company is domiciled in the United States and has international operations around the globe. The following table presents the Company’s long-lived assets by geographic region as of March 31, 2024 and December 31, 2023: March 31, December 31, 2024 2023 (In thousands) United States $ 430,731 $ 438,420 Germany 41,778 45,424 Australia 11,865 11,660 Netherlands 5,843 5,863 Other (1) 13,135 12,438 Total long-lived assets $ 503,352 $ 513,805 —————————————— (1) United Kingdom, Japan, France, Italy, Spain, Canada, and Singapore |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The changes in the carrying amount of goodwill as of March 31, 2024 and December 31, 2023 are as follows: Consolidated (In thousands) Balance as of December 31, 2022 $ 296,214 Adjustments to goodwill: Goodwill impairment (1) (11,895) Foreign exchange adjustment 1,312 Balance as of December 31, 2023 $ 285,631 Adjustments to goodwill: Goodwill impairment (1) (3,627) Foreign exchange adjustment (1,048) Balance as of March 31, 2024 $ 280,956 |
Summary of Intangible Assets | Intangible assets are summarized as follows: March 31, 2024 Gross Accumulated Net Carrying Amount Weighted (In thousands) (In years) Amortizing intangible assets: Technology $ 94,562 $ (65,107) $ 29,455 5.0 Customer relationships 32,060 (20,057) 12,003 10.0 Patents 15,895 (2,066) 13,829 12.9 Trademarks 1,404 (761) 643 5.0 Trade names 1,044 (1,044) — 2.8 Other 914 (835) 79 4.1 Total $ 145,879 $ (89,870) $ 56,009 December 31, 2023 Gross Accumulated Net Carrying Amount Weighted (In thousands) (In years) Amortizing intangible assets: Technology $ 94,549 $ (60,465) $ 34,084 5.0 Customer relationships 32,025 (19,542) 12,483 10.0 Patents 15,350 (1,916) 13,434 12.9 Trademarks 1,400 (707) 693 5.0 Trade names 1,044 (672) 372 2.8 Other 914 (355) 559 4.1 Total $ 145,282 $ (83,657) $ 61,625 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | As of March 31, 2024, estimated annual amortization expense for the next five years and thereafter is as follows: Estimated Amortization Expense (In thousands) Remainder of 2024 $ 11,567 2025 14,996 2026 12,160 2027 1,004 2028 821 Thereafter 15,461 Total $ 56,009 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | The following table presents the detail of property and equipment, net for the periods presented: March 31, December 31, Useful life (In thousands) (In years) Internal-use software development costs $ 186,746 $ 181,079 5 Computer equipment and software 126,728 123,580 3 to 5 Furniture, equipment and building improvements 329 327 The lesser of 5 or estimated useful life Finance lease right-of-use assets 128 3,060 2 Property and equipment, at cost 313,931 308,046 Less: accumulated depreciation (196,038) (188,721) Property and equipment, net $ 117,893 $ 119,325 Total depreciation included in our condensed consolidated statements of operations for the three months ended March 31, 2024 and 2023 is as follows: March 31, March 31, (In thousands) Cost of revenue $ 1,682 $ 2,247 Sales and marketing 900 726 General and administrative 158 161 Product development 5,485 4,228 Total $ 8,225 $ 7,362 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | The following table presents the detail of accrued expenses and other current liabilities for the periods presented: March 31, December 31, (In thousands) Professional services and consulting and other vendor fees $ 56,593 $ 67,585 Payroll and other employee-related costs 13,214 20,767 Finance lease liability 104 3,037 Restructuring 1,808 2,076 Sales commissions 1,645 734 Non-income tax 556 556 Other 1,586 2,269 Total $ 75,506 $ 97,024 |
Convertible Senior Notes and _2
Convertible Senior Notes and Capped Call Transactions (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Carrying Amount of Liability Component of Convertible Debt | The net carrying amount of the liability component of the Notes as of March 31, 2024 and December 31, 2023 is as follows: March 31, December 31, (In thousands) Principal $ 517,500 $ 589,992 Unamortized issuance costs (5,424) (6,034) Total net carrying value $ 512,076 $ 583,958 Less: short-term debt, net — 72,393 Long-term debt, net $ 512,076 $ 511,565 |
Schedule of Interest Expense Incurred | The following table sets forth the interest expense recognized related to the Notes: Three Months Ended March 31, 2024 2023 (In thousands) Contractual interest expense $ 91 $ 441 Amortization of debt issuance costs 610 920 Total interest expense $ 701 $ 1,361 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Supplemental cash flow information related to leases | Supplemental cash flow information related to leases for the periods ended March 31, 2024 and 2023 is as follows: Three Months Ended March 31, 2024 2023 (In thousands) Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 842 $ 974 Operating cash flows for finance leases 18 24 Financing cash flows for finance leases 327 958 |
Schedule of components of lease costs | The components of lease costs for the periods ended March 31, 2024 and 2023 are as follows: Three Months Ended March 31, 2024 2023 (In thousands) Finance lease cost Amortization of right of use assets $ 334 $ 911 Interest 18 24 Operating lease cost 2,902 2,740 Total lease cost $ 3,254 $ 3,675 March 31, March 31, Weighted Average Remaining Lease Term: Operating leases 2.0 years 1.7 years Finance leases 1.6 years 1.0 year Weighted Average Discount Rate: Operating leases 7 % 7 % Finance leases 7 % 4 % |
Supplemental balance sheet information related to leases | Supplemental balance sheet information related to leases is as follows: Financial Statement Classification March 31, December 31, (In thousands) Assets Operating right-of-use assets Operating lease right-of-use assets $ 3,431 $ 4,135 Finance right-of-use assets Property and equipment, net 128 3,060 Liabilities Current liabilities: Operating lease liabilities Operating lease liabilities $ 2,632 $ 2,719 Finance lease liabilities Accrued expenses and other current liabilities 104 3,037 Non-current liabilities: Operating lease liabilities Operating lease liabilities, net of current portion 1,466 2,173 Finance lease liabilities Other liabilities 55 85 |
Schedule of Future Minimum Lease Payments | Future minimum lease payments under non-cancellable operating and finance leases (with an initial or remaining lease term in excess of one year) are as follows: March 31, 2024 Operating Finance (In thousands) 2024 (remaining nine months for March 31, 2024) $ 2,186 $ 83 2025 1,689 83 2026 316 — 2027 172 — 2028 86 — Thereafter — — Total minimum lease payments 4,449 166 Less: present value adjustment (351) (7) Present value of lease liabilities $ 4,098 $ 159 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value | The Company’s assets and liabilities that are measured at fair value on a recurring basis, by level, within the fair value hierarchy as of March 31, 2024 and December 31, 2023, are summarized as follows: March 31, 2024 Level 1 Level 2 Level 3 Total (In thousands) Assets Cash equivalents: Money market funds $ 84,990 $ — $ — $ 84,990 Total assets $ 84,990 $ — $ — $ 84,990 December 31, 2023 Level 1 Level 2 Level 3 Total (In thousands) Assets Cash equivalents: Money market funds $ 174,701 $ — $ — $ 174,701 Total assets $ 174,701 $ — $ — $ 174,701 |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The estimated fair value of outstanding balances of our 2024 Notes and 2026 Notes are as follows: Level of Hierarchy Fair Value Principal Balance Unamortized Issuance Costs Net Carrying Value (In thousands) March 31, 2024 2026 Notes 2 $ 367,497 $ 517,500 $ (5,424) $ 512,076 December 31, 2023 2024 and 2026 Notes 2 $ 435,883 $ 589,992 $ (6,034) $ 583,958 |
Schedule of Changes in Fair Value of Level 3 Liabilities | The changes in fair value of the Level 3 liabilities during the annual period ended December 31, 2023 are as follows: December 31, Balance, beginning of year $ 72,221 Additions in the period — Change in fair value of contingent consideration 4,629 Change in fair value of liability awards (27,857) Payments (48,993) Balance, end of year $ — |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Stock Option Activity and Weighted Average Exercise Prices | The following table is a summary of the Company’s stock option activity for the three months ended March 31, 2024: Stock Option Activity Weighted Average Remaining Contractual Term Aggregate Intrinsic Value Options Weighted Balance outstanding at December 31, 2023 3,137 $ 22.68 4.84 $ 40 Granted 1,000 (1) 1.02 Exercised — — Cancelled or expired (885) 23.65 Balance outstanding at March 31, 2024 3,252 15.75 5.99 3 Options vested and expected to vest 647 9.30 3.71 — Options exercisable at March 31, 2024 1,977 $ 21.56 9.35 $ 3 (1) Represents a stock option award, granted to the Company’s new Chief Executive Officer, to acquire shares of the Company’s common stock that will vest upon the satisfaction of certain performance-based and time-based vesting conditions. This award, provided for under the terms of the Chief Executive Officer’s employment agreement, was approved by the Compensation Committee of the Company’s board of directors (the “Board”) as a standalone inducement award under applicable Nasdaq rules and does not count against the number of shares reserved for issuance under the Company’s 2019 Stock Incentive Plan or the Company’s 2018 Inducement Plan. |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity | The following table is a summary of the Company’s RSUs and PRSUs activity for the three months ended March 31, 2024: Number of Shares Weighted Average Grant Date Fair Value Aggregate Fair Value (In thousands) (Per share) (In thousands) Balance outstanding at December 31, 2023 5,064 $ 12.53 $ 19,193 Awarded 3,893 1.17 Vested (433) 16.94 Forfeited (471) 16.61 Non-vested and outstanding at March 31, 2024 8,053 6.56 7,879 Expected to vest 5,285 $ 7.02 $ 5,153 |
Disclosure of Share-Based Compensation Arrangements by Share-Based Payment Award | Total stock-based compensation costs included in our condensed consolidated statements of operations for the three months ended March 31, 2024 and 2023 are as follows: Three Months Ended March 31, 2024 2023 (In thousands) Cost of revenue $ 343 $ 2,035 Sales and marketing 2,455 2,404 General and administrative 1,798 2,632 Product development 2,962 4,261 Total $ 7,558 $ 11,332 |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring and Related Costs | The following table presents the detail of the liability for the Company’s restructuring charges, which is included within accrued expenses and other current liabilities within the accompanying condensed consolidated balance sheets as of March 31, 2024 and December 31, 2023: March 31, December 31, (In thousands) Balance, beginning of the year $ 2,076 $ 803 IT contract termination costs 715 5,744 Severance and other compensation associated costs 2,594 16,920 Cash payments (3,577) (21,391) Balance, end of period $ 1,808 $ 2,076 The Company anticipates that payments associated with the employee severance and other compensation associated costs reflected in the table above will be substantially completed by December 31, 2024. |
Schedule of Restructuring Liability by Cost Type | The following table presents the detail of expenses for the Company’s restructuring charges for the three months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 2023 (In thousands) Lease restructuring costs $ — $ 1 IT contract termination costs 715 — Severance and other associated costs 2,594 11,514 Total restructuring costs $ 3,309 $ 11,515 |
Description of Business and B_4
Description of Business and Basis of Presentation (Details) | Mar. 31, 2024 connection |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number Of Connections And Conversations Powered Each Month | 1,000,000,000 |
Description of Business and B_5
Description of Business and Basis of Presentation - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Accounting Policies [Abstract] | ||
Prepaid software maintenance | $ 6,065 | $ 8,592 |
VAT receivable | 4,168 | 4,399 |
Prepaid server maintenance | 2,824 | 2,634 |
Prepaid - other | 2,743 | 2,599 |
Other assets | 5,154 | 8,757 |
Prepaid expenses and other current assets (Note 1) | $ 20,954 | $ 26,981 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | $ 85,149 | $ 107,661 |
Hosted Services - Business | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | 71,495 | 87,338 |
Professional Services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | $ 13,654 | 20,323 |
Hosted Services - Consumer | Kasamba, Inc. | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | $ 7,200 |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | ||
Remaining performance obligation | $ 296,700 | |
Percentage of remaining performance obligations to be recognized over next 24 months | 91% | |
Recognition of deferred revenue | $ 42,500 | $ 44,100 |
Revenue Recognition - Revenue b
Revenue Recognition - Revenue by Geographic Location (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | $ 85,149 | $ 107,661 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | 60,507 | 68,509 |
Other Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | 1,518 | 3,805 |
Total Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | 62,025 | 72,314 |
EMEA | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | 14,221 | 16,182 |
APAC | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | 8,903 | 19,165 |
United Kingdom | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from related parties | $ 10,700 | $ 15,300 |
Revenue Recognition - Receivabl
Revenue Recognition - Receivables and Deferred Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Contract Balances [Roll Forward] | |||
Accounts receivable, opening balance | $ 81,802 | ||
Accounts receivable, ending balance | 71,365 | $ 81,802 | |
Contract acquisition costs noncurrent, opening balance | 37,354 | $ 43,804 | 43,804 |
Contract acquisition costs noncurrent, increase (decrease), net | 1,972 | (6,450) | |
Contract acquisition costs noncurrent, ending balance | 39,326 | 37,354 | |
Deferred revenue (current), opening balance | 81,858 | 84,494 | 84,494 |
Deferred revenue (current), increase (decrease), net | 10,556 | (2,636) | |
Deferred revenue (current), ending balance | 92,414 | 81,858 | |
Deferred revenue (long-term), opening balance | 183 | 174 | 174 |
Deferred revenue (long-term), increase (decrease), net | (60) | 9 | |
Deferred revenue (long-term), ending balance | 123 | 183 | |
Amortization of acquisition costs | 4,900 | 8,300 | |
Billed receivable | |||
Contract Balances [Roll Forward] | |||
Accounts receivable, opening balance | 60,382 | 53,468 | 53,468 |
Accounts receivable, increase (decrease), net | (6,177) | 6,914 | |
Accounts receivable, ending balance | 54,205 | 60,382 | |
Unbilled receivable | |||
Contract Balances [Roll Forward] | |||
Accounts receivable, opening balance | 21,420 | $ 33,069 | 33,069 |
Accounts receivable, increase (decrease), net | (4,260) | (11,649) | |
Accounts receivable, ending balance | $ 17,160 | $ 21,420 |
Revenue Recognition - Accounts
Revenue Recognition - Accounts Receivable (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Allowance for Doubtful Accounts | |||
Beginning balance | $ 9,290 | $ 9,239 | $ 9,239 |
Additions charged to costs and expenses | 4,722 | $ 1,079 | 3,319 |
Deductions/write-offs | (4,777) | (3,268) | |
Ending balance | $ 9,235 | $ 9,290 |
Net Loss Per Share - Narrative
Net Loss Per Share - Narrative (Details) - Convertible Debt | 1 Months Ended | ||
Dec. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2022 | |
2024 Notes | |||
Debt Instrument [Line Items] | |||
Debt instrument stated rate (percent) | 0.75% | ||
Debt Instrument, Convertible, Conversion Ratio | 0.0259182 | ||
2026 Notes | |||
Debt Instrument [Line Items] | |||
Debt instrument stated rate (percent) | 0% | ||
Debt Instrument, Convertible, Conversion Ratio | 0.0132933 |
Net Loss Per Share - Reconcilia
Net Loss Per Share - Reconciliation of Shares Used in Calculating Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Earnings Per Share [Abstract] | ||
Net income (loss) available to common stockholders, basic | $ (35,631) | $ (17,420) |
Weighted-average shares used to compute basic net income per share (in shares) | 88,081,654 | 75,774,812 |
Diluted (in shares) | 88,081,654 | 75,774,812 |
Basic (in dollars per share) | $ (0.40) | $ (0.23) |
Diluted (in dollars per share) | $ (0.40) | $ (0.23) |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Antidilutive Securities Excluded from Computation of EPS (Details) - shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common stock awards not included in earnings per share calculation (in shares) | 18,183,711 | 40,986,932 |
Shares subject to outstanding common stock options and employee stock purchase plan | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common stock awards not included in earnings per share calculation (in shares) | 3,251,520 | 4,078,938 |
Restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common stock awards not included in earnings per share calculation (in shares) | 8,052,908 | 4,331,255 |
Fair Value Earnout | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common stock awards not included in earnings per share calculation (in shares) | 0 | 23,818,594 |
Conversion option of the Notes | 2024 Notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common stock awards not included in earnings per share calculation (in shares) | 0 | 1,878,862 |
Conversion option of the Notes | 2026 Notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive common stock awards not included in earnings per share calculation (in shares) | 6,879,283 | 6,879,283 |
Segment Information - Narrative
Segment Information - Narrative (Details) - segment | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Segment Reporting [Abstract] | ||
Number of operating segments | 1 | 2 |
Number of reportable segments | 1 |
Segment Information - Long-Live
Segment Information - Long-Lived Assets by Geographic Region (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Segment Reporting Information [Line Items] | ||
Total long-lived assets | $ 503,352 | $ 513,805 |
United States | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 430,731 | 438,420 |
Germany | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 41,778 | 45,424 |
Australia | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 11,865 | 11,660 |
Netherlands | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | 5,843 | 5,863 |
Other | ||
Segment Reporting Information [Line Items] | ||
Total long-lived assets | $ 13,135 | $ 12,438 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | $ 285,631 | ||
Impairment of goodwill | (3,627) | $ 0 | $ (11,895) |
Goodwill, ending balance | 280,956 | 285,631 | |
Business | |||
Goodwill [Roll Forward] | |||
Goodwill, beginning balance | 285,631 | $ 296,214 | 296,214 |
Foreign exchange adjustment | (1,048) | 1,312 | |
Goodwill, ending balance | $ 280,956 | $ 285,631 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 145,879 | $ 145,282 |
Accumulated Amortization | (89,870) | (83,657) |
Net Carrying Amount | 56,009 | 61,625 |
Technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 94,562 | 94,549 |
Accumulated Amortization | (65,107) | (60,465) |
Net Carrying Amount | $ 29,455 | $ 34,084 |
Weighted Average Useful Life | 5 years | 5 years |
Customer relationships | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 32,060 | $ 32,025 |
Accumulated Amortization | (20,057) | (19,542) |
Net Carrying Amount | $ 12,003 | $ 12,483 |
Weighted Average Useful Life | 10 years | 10 years |
Patents | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 15,895 | $ 1,400 |
Accumulated Amortization | (2,066) | (707) |
Net Carrying Amount | $ 13,829 | $ 693 |
Weighted Average Useful Life | 12 years 10 months 24 days | 2 years 9 months 18 days |
Trademarks | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,404 | $ 1,044 |
Accumulated Amortization | (761) | (672) |
Net Carrying Amount | $ 643 | $ 372 |
Weighted Average Useful Life | 5 years | 5 years |
Trade names | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,044 | $ 15,350 |
Accumulated Amortization | (1,044) | (1,916) |
Net Carrying Amount | $ 0 | $ 13,434 |
Weighted Average Useful Life | 2 years 9 months 18 days | 12 years 10 months 24 days |
Other | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 914 | $ 914 |
Accumulated Amortization | (835) | (355) |
Net Carrying Amount | $ 79 | $ 559 |
Weighted Average Useful Life | 4 years 1 month 6 days | 4 years 1 month 6 days |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Goodwill [Line Items] | |||
Impairment of goodwill | $ 3,627,000 | $ 0 | $ 11,895,000 |
Amortization of purchased intangible assets | 891,000 | 874,000 | |
Impairment of intangible assets | 2,221,000 | 0 | |
WildHealth | |||
Goodwill [Line Items] | |||
Impairment of goodwill | 3,600,000 | ||
Other Asset Impairment Charges | 2,200,000 | ||
Cost of revenue | |||
Goodwill [Line Items] | |||
Amortization of purchased intangible assets | 4,200,000 | 5,400,000 | |
Amortization of purchased intangibles | $ 3,300,000 | $ 4,600,000 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization Expense (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Estimated Amortization Expense | ||
Remainder of 2024 | $ 11,567 | |
2025 | 14,996 | |
2026 | 12,160 | |
2027 | 1,004 | |
2028 | 821 | |
Thereafter | 15,461 | |
Total | $ 56,009 | $ 61,625 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Property, Plant and Equipment [Line Items] | ||
Finance lease right-of-use assets | $ 128 | $ 3,060 |
Property and equipment and finance lease, gross | 313,931 | 308,046 |
Less: accumulated depreciation | (196,038) | (188,721) |
Property and equipment, net | $ 117,893 | 119,325 |
Finance lease, term of contract | 2 years | |
Internal-use software development costs | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 186,746 | 181,079 |
Useful life | 5 years | |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 126,728 | 123,580 |
Computer equipment and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 3 years | |
Computer equipment and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 5 years | |
Finance lease right-of-use assets | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 329 | $ 327 |
Useful life | 5 years |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 8,200,000 | $ 7,400,000 |
Impairment, Long-Lived Asset, Held-for-Use | $ 0 | $ 0 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Depreciation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 8,225 | $ 7,362 |
Cost of revenue | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | 1,682 | 2,247 |
Sales and marketing | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | 900 | 726 |
General and administrative | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | 158 | 161 |
Product development | ||
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 5,485 | $ 4,228 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | |||
Professional services and consulting and other vendor fees | $ 56,593 | $ 67,585 | |
Payroll and other employee-related costs | 13,214 | 20,767 | |
Finance lease liability | 104 | 3,037 | |
Restructuring | 1,808 | 2,076 | $ 803 |
Sales commissions | 1,645 | 734 | |
Non-income tax | 556 | 556 | |
Other | 1,586 | 2,269 | |
Total | $ 75,506 | $ 97,024 |
Convertible Senior Notes and _3
Convertible Senior Notes and Capped Call Transactions - Narrative (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||
Mar. 21, 2023 USD ($) | Dec. 31, 2020 | Dec. 31, 2020 USD ($) day shares | Mar. 31, 2019 USD ($) | Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2020 USD ($) | Mar. 31, 2024 $ / shares | Dec. 31, 2023 $ / shares | Dec. 31, 2022 USD ($) $ / shares | |
Debt Instrument [Line Items] | |||||||||||
Debt instrument, repurchase amount | $ 149,700 | ||||||||||
Debt instrument, increase (decrease), net | 157,500 | ||||||||||
Convertible senior notes, net of current portion (Note 8) | $ 512,076 | $ 511,565 | |||||||||
Number of shares of common stock covered by called caps (shares) | shares | 6,880 | ||||||||||
Reduction to additional paid-in-capital related to called caps | $ 46,100 | ||||||||||
Interest expense | 700 | $ 1,400 | |||||||||
Common stock, par value (in dollars per share) | (per share) | $ 1 | $ 1 | $ 0.001 | ||||||||
2024 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Principal Balance | 72,000 | ||||||||||
Debt instrument, increase (decrease), net | $ 228,300 | ||||||||||
Gain (loss) on extinguishment of debt | 7,200 | ||||||||||
2024 Notes | Previously Reported | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Gain (loss) on extinguishment of debt | 6,100 | ||||||||||
Payment for debt extinguishment or debt prepayment cost | $ 500 | ||||||||||
2024 Notes | Revision of Prior Period, Adjustment | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Gain (loss) on extinguishment of debt | $ 1,100 | ||||||||||
2024 Notes | Convertible Debt | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Principal Balance | $ 230,000 | 72,500 | |||||||||
Debt instrument stated rate (percent) | 0.75% | ||||||||||
Debt Instrument, Convertible, Conversion Ratio | 0.0259182 | ||||||||||
2026 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Convertible senior notes, net of current portion (Note 8) | 512,100 | ||||||||||
Unamortized issuance costs | $ 5,400 | ||||||||||
2026 Notes | Convertible Debt | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Principal Balance | $ 517,500 | ||||||||||
Debt instrument stated rate (percent) | 0% | ||||||||||
Proceeds from debt offering, net of debt issuance costs | $ 505,300 | ||||||||||
Debt Instrument, Convertible, Conversion Ratio | 0.0132933 | ||||||||||
Percentage of principal amount paid if repurchase due to fundamental change (percent) | 100% | ||||||||||
Threshold trading days in consideration of note conversion | day | 20 | ||||||||||
Threshold consecutive trading days in analysis of conversion price | day | 30 | ||||||||||
Threshold percentage of stock price if converted | 130% | ||||||||||
Debt Instrument, Convertible Business Period | 5 years | ||||||||||
Debt Instrument, Convertible, Measurement Period | 5 years | ||||||||||
Threshold for five day period, product of sale price of common stock and conversion rate of notes | 98% | ||||||||||
Remaining amortization period for debt discount and debt issuance costs | 2 years 8 months 12 days | ||||||||||
Effective interest rate (percent) | 0.40% | ||||||||||
Convertible debt conversion price (in dollars per share) | $ / shares | $ 75.23 | ||||||||||
Capped calls | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Capped caps initial strike price (in dollars per share) | $ / shares | 75.23 | ||||||||||
Capped caps initial cap price (in dollars per share) | $ / shares | $ 105.58 |
Convertible Senior Notes and _4
Convertible Senior Notes and Capped Call Transactions - Schedule of Carrying Amount of Liability Component of Convertible Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument [Line Items] | ||
Total net carrying value | $ 512,076 | $ 583,958 |
Less: short-term debt, net | 0 | 72,393 |
Long-term debt, net | 512,076 | 511,565 |
Convertible Debt | Convertible Senior Notes | ||
Debt Instrument [Line Items] | ||
Principal | 517,500 | 589,992 |
Unamortized issuance costs | $ 5,424 | $ 6,034 |
Convertible Senior Notes and _5
Convertible Senior Notes and Capped Call Transactions - Schedule of Interest Expense Incurred (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Debt Instrument [Line Items] | ||
Amortization of debt issuance costs | $ 610 | $ 920 |
Total interest expense | 700 | 1,400 |
Convertible Senior Notes | Convertible Debt | ||
Debt Instrument [Line Items] | ||
Contractual interest expense | 91 | 441 |
Amortization of debt issuance costs | 610 | 920 |
Total interest expense | $ 701 | $ 1,361 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) | Mar. 31, 2024 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Operating leases remaining lease term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Operating leases remaining lease term | 5 years |
Leases (Supplemental cash flow
Leases (Supplemental cash flow information related to leases) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Leases [Abstract] | ||
Operating cash flows for operating leases | $ 842 | $ 974 |
Operating cash flows for finance leases | 18 | 24 |
Financing cash flows for finance leases | $ 327 | $ 958 |
Leases (Schedule of components
Leases (Schedule of components of lease costs) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Leases [Abstract] | ||
Amortization of right of use assets | $ 334 | $ 911 |
Interest | 18 | 24 |
Operating lease cost | 2,902 | 2,740 |
Total lease cost | $ 3,254 | $ 3,675 |
Operating leases, weighted average remaining lease term (in years) | 2 years | 1 year 8 months 12 days |
Finance leases, weighted average remaining lease term (in years) | 1 year 7 months 6 days | 1 year |
Operating leases, weighted average discount rate (percent) | 7% | 7% |
Finance leases, weighted average discount rate (percent) | 7% | 4% |
Leases (Supplemental balance sh
Leases (Supplemental balance sheet information related to leases) (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
ASSETS | ||
Operating right of use assets | $ 3,431 | $ 4,135 |
Finance right of use assets | 128 | 3,060 |
Current liabilities: | ||
Operating Lease, Liability, Current | 2,632 | 2,719 |
Finance lease liability | 104 | 3,037 |
Non-current: | ||
Operating Lease, Liability, Noncurrent | 1,466 | 2,173 |
Finance lease liabilities | $ 55 | $ 85 |
Leases (Schedule of Future Mini
Leases (Schedule of Future Minimum Lease Payments) (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Operating Leases | |
2023 (remaining three months for March 31, 2024) | $ 2,186 |
2024 | 1,689 |
2025 | 316 |
2026 | 172 |
2027 | 86 |
Thereafter | 0 |
Total minimum lease payments | 4,449 |
Less: present value adjustment | (351) |
Operating lease, liability | 4,098 |
Finance Leases | |
2023 (remaining three months for March 31, 2024) | 83 |
2024 | 83 |
2025 | 0 |
2026 | 0 |
2027 | 0 |
Finance Lease Liability Payment Due After Year Four | 0 |
Total minimum lease payments | 166 |
Less: present value adjustment | (7) |
Present value of lease liabilities | $ 159 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Assets | ||
Money market funds | $ 84,990 | $ 174,701 |
Total assets | 84,990 | 174,701 |
Recurring | Level 1 | ||
Assets | ||
Money market funds | 84,990 | |
Total assets | 84,990 | 174,701 |
Recurring | Level 2 | ||
Assets | ||
Money market funds | 0 | |
Total assets | 0 | 0 |
Recurring | Level 3 | ||
Assets | ||
Money market funds | 0 | |
Total assets | $ 0 | $ 0 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Fair Value of Level 3 Liabilities (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Change in Fair Value of Level 3 Liabilities | |
Beginning balance | $ 72,221 |
Additions in the period | 0 |
Payments | (48,993) |
Ending balance | 0 |
Contingent Liability | |
Change in Fair Value of Level 3 Liabilities | |
Change in fair value of liability awards | 4,629 |
Liability Awards | |
Change in Fair Value of Level 3 Liabilities | |
Change in fair value of liability awards | $ (27,857) |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
WildHealth | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Payments for previous acquisition | $ 12 |
VoiceBase, Inc. | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Payments for previous acquisition | 19.9 |
Tenfold | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Payments for previous acquisition | 9.3 |
ebot-7 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Payments for previous acquisition | $ 7.7 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Carrying Value and Fair Value of Debt Instruments (Details) - Level 2 - Convertible Senior Notes Due 2024 and 2026 - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 367,497 | $ 435,883 |
Principal Balance | 517,500 | 589,992 |
Unamortized Issuance Costs | (5,424) | (6,034) |
Net Carrying Value | $ 512,076 | $ 583,958 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Other Commitments [Line Items] | |||
Employer matching contributions | $ 1.1 | $ 1.4 | |
Long-term purchase commitment, period | 2 years | ||
Accrued sales tax, including interest | $ 0.6 | $ 0.6 | |
Letter of Credit | LOC for Security Deposit | |||
Other Commitments [Line Items] | |||
Letters of credit outstanding, amount | $ 0.5 | ||
Match Step One | |||
Other Commitments [Line Items] | |||
Employer matching contribution, percent of match | 100% | ||
Employer matching contribution percent of eligible compensation | 3% | ||
Match Step Two | |||
Other Commitments [Line Items] | |||
Employer matching contribution, percent of match | 50% | ||
Employer matching contribution percent of eligible compensation | 2% |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Stock Option Activity and Weighted Average Exercise Prices (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Options | ||
Beginning balance (in shares) | 3,137 | |
Granted (in shares) | 1,000 | |
Exercised (in shares) | 0 | |
Cancelled or expired (in shares) | (885) | |
Ending balance (in shares) | 3,252 | 3,137 |
Options vested and expected to vest (in shares) | 647 | |
Options exercisable at end of period (in shares) | 1,977 | |
Weighted Average Exercise Price | ||
Beginning balance (in dollars per share) | $ 22.68 | |
Granted (in dollars per share) | 1.02 | |
Exercised (in dollars per share) | 0 | |
Cancelled or expired (in dollars per share) | 23.65 | |
Ending balance (in dollars per share) | 15.75 | $ 22.68 |
Options vested and expected to vest (in dollars per share) | 9.30 | |
Options exercisable at end of period (in dollars per share) | $ 21.56 | |
Weighted Average Remaining Contractual Term | ||
Weighted average remaining contract term, Options outstanding | 5 years 11 months 26 days | 4 years 10 months 2 days |
Weighted average remaining contract term, Options vested and expected to vest | 3 years 8 months 15 days | |
Weighted average remaining contract term, Options exercisable | 9 years 4 months 6 days | |
Aggregate Intrinsic Value | ||
Aggregate intrinsic value, Options outstanding | $ 3 | $ 40 |
Aggregate intrinsic value, Options vested and expected to vest | 0 | |
Aggregate intrinsic value, Options exercisable | $ 3 |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Restricted Stock Unit Activity and Weighted Average Exercise Price (Details) - RSUs - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Number of Shares | ||
Beginning balance outstanding (in shares) | 5,064 | |
Awarded (in shares) | 3,893 | |
Vested (in shares) | (433) | |
Forfeited (in shares) | (471) | |
Non-vested and outstanding at end of period (in shares) | 8,053 | |
Expected to vest (in shares) | 5,285 | |
Weighted Average Grant Date Fair Value (usd per share) | ||
Beginning balance outstanding (in dollars per share) | $ 12.53 | |
Awarded (in dollars per share) | 1.17 | |
Vested (in dollars per share) | 16.94 | |
Forfeited (in dollars per share) | 16.61 | |
Non-vested and outstanding at end of period (in dollars per share) | 6.56 | |
Expected to vest (in dollars per share) | $ 7.02 | |
Aggregate Fair Value | ||
Aggregate fair value, Non-vested and outstanding | $ 7,879 | $ 19,193 |
Aggregate fair value, Expected to vest | $ 5,153 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 08, 2024 | Mar. 31, 2024 | |
Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares of common stock available for issuance (up to) (in shares) | 42,367,744 | |
Options term (in years) | 10 years | |
Unrecognized compensation cost related to novested share-based compensation arrangements | $ 2.8 | |
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 1 year 10 months 24 days | |
Stock Option | 2019 Stock Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation arrangement by share-based payment award, number of shares available for grant (in shares) | 2,286,084 | |
Employee Stock Purchase Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares of common stock available for issuance (up to) (in shares) | 2,000,000 | |
Share-based compensation arrangement by share-based payment award, number of shares available for grant (in shares) | 948,453 | |
Incentive Stock Option | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares of common stock available for issuance (up to) (in shares) | 11,459,009 | |
Share-based compensation arrangement by share-based payment award, number of shares available for grant (in shares) | 5,994,216 | |
Increase in number of shares of common stock available for issuance | 5,300,000 | |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 1 year 10 months 24 days | |
Unrecognized compensation cost related to nonvested share-based compensation arrangements | $ 37.7 | |
Restricted stock units | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 3 years | |
Restricted stock units | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 4 years |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Stock-Based Compensation Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 7,558 | $ 11,332 |
Cost of revenue | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 343 | 2,035 |
Sales and marketing | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 2,455 | 2,404 |
General and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | 1,798 | 2,632 |
Product development | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation expense | $ 2,962 | $ 4,261 |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring and Related Activities [Abstract] | ||
Restructuring expense | $ 3,309 | $ 11,515 |
Restructuring - Schedule of Res
Restructuring - Schedule of Restructuring Reserve (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Mar. 31, 2024 | Jun. 30, 2023 | |
Restructuring Reserve [Roll Forward] | ||
Balance, beginning of period | $ 2,076 | $ 803 |
IT contract termination costs | 715 | 5,744 |
Severance and other compensation associated costs | 2,594 | 16,920 |
Cash payments | (3,577) | $ (21,391) |
Balance, end of period | $ 1,808 |
Restructuring - Schedule of R_2
Restructuring - Schedule of Restructuring Liability by Cost Type (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring expense | $ 3,309 | $ 11,515 |
Severance and other compensation associated costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring expense | 2,594 | 11,514 |
Lease restructuring costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring expense | 0 | 1 |
Contract Termination | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring expense | $ 715 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Income Tax Contingency [Line Items] | |||
Provision for income taxes | $ 362 | $ 1,214 | |
Valuation allowance | $ 211,200 | ||
Increase in valuation allowance recorded as an expense | 24,900 | ||
Accounting Standards Update 2020-06 | |||
Income Tax Contingency [Line Items] | |||
Decrease in valuation allowance charged to equity | 23,700 | ||
Foreign Tax Authority | |||
Income Tax Contingency [Line Items] | |||
Increase in valuation recorded | $ 23,700 | ||
Provision for income taxes | $ 400 |
Equity Method Investments (Deta
Equity Method Investments (Details) - USD ($) | 3 Months Ended | |||
Feb. 13, 2022 | Mar. 31, 2023 | Mar. 31, 2024 | Dec. 31, 2023 | |
Schedule of Equity Method Investments [Line Items] | ||||
Equity method investment, contribution, term | 5 years | |||
Claire Holdings, Inc. | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Payments to acquire equity method investments | $ 19,000,000 | |||
Ownership percentage | 19.20% | |||
Other operating income (expense), net | $ 600,000 | |||
Equity Method Investments | $ 0 | $ 0 | ||
Claire Holdings, Inc. | Pasaca Capital Inc. (“Pasaca”) | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Payments to acquire equity method investments | $ 80,000,000 | |||
Ownership percentage | 80.80% |
Variable Interest Entity (Detai
Variable Interest Entity (Details) | Feb. 28, 2022 corporation |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable interests, number of professional corporations | 4 |
Related Parties (Details)
Related Parties (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | ||||
Revenue from related parties | $ 85,149 | $ 107,661 | ||
Accounts receivable, related parties | 71,365 | $ 81,802 | ||
Accounts for doubtful accounts | 9,235 | 9,290 | $ 9,239 | |
Related Party | ||||
Related Party Transaction [Line Items] | ||||
Revenue from related parties | 0 | $ 3,800 | ||
Accounts receivable, related parties | $ 2,100 | |||
Accounts for doubtful accounts | $ 1,500 |
Divestiture - Narrative (Detail
Divestiture - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Proceeds from divestiture | $ 0 | $ 13,819 | |
Restricted cash | 1,960 | $ 12,197 | $ 2,143 |
Kasamba, Inc. | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Proceeds from divestiture | 16,900 | ||
Deferred proceeds from divestiture of business | 2,600 | ||
Restricted cash | $ 11,800 | ||
Maximum length of time, restricted cash held in escrow | 15 months | ||
Increase (decrease) of restricted investments | $ 9,800 | ||
Disposal Group, Held-for-sale, Not Discontinued Operations | Kasamba, Inc. | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Gain on disposition of business | $ 1,800 | $ 17,600 |