Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 23, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-34835 | ||
Entity Registrant Name | Envestnet, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-1409613 | ||
Entity Address, Address Line One | 1000 Chesterbrook Boulevard | ||
Entity Address, Address Line Two | Suite 250 | ||
Entity Address, City or Town | Berwyn | ||
Entity Address, State or Province | PA | ||
Entity Address, Postal Zip Code | 19312 | ||
City Area Code | 312 | ||
Local Phone Number | 827-2800 | ||
Title of 12(b) Security | Common Stock, par value $0.005 per share | ||
Trading Symbol | ENV | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Financial Statement Error Correction [Flag] | true | ||
Document Financial Statement Restatement Recovery Analysis [Flag] | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 2 | ||
Entity Common Stock, Shares Outstanding | 54,788,793 | ||
Documents Incorporated by Reference | Part III incorporates by reference portions of the registrant’s definitive proxy statement for the annual meeting of stockholders, which will be filed within 120 days after the close of the 2023 fiscal year. | ||
Entity Central Index Key | 0001337619 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Auditor Information [Abstract] | |
Auditor Name | KPMG LLP |
Auditor Location | Denver, Colorado |
Auditor Firm ID | 185 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 91,378 | $ 162,173 |
Fees receivable, net | 120,958 | 101,696 |
Prepaid expenses and other current assets | 51,472 | 47,422 |
Total current assets | 263,808 | 311,291 |
Property and equipment, net | 48,223 | 48,481 |
Internally developed software, net | 224,713 | 184,558 |
Intangible assets, net | 338,068 | 379,995 |
Goodwill | 806,563 | 998,414 |
Operating lease right-of-use assets, net | 69,154 | 81,596 |
Other assets | 126,723 | 107,830 |
Total assets | 1,877,252 | 2,112,165 |
Current liabilities: | ||
Accounts payable, accrued expenses and other current liabilities | 241,424 | 233,866 |
Operating lease liabilities | 12,909 | 11,949 |
Deferred revenue | 38,201 | 36,363 |
Current portion of debt | 0 | 44,886 |
Total current liabilities | 292,534 | 327,064 |
Debt | 876,612 | 871,769 |
Operating lease liabilities, net of current portion | 100,830 | 110,652 |
Deferred tax liabilities, net | 16,568 | 16,196 |
Other liabilities | 16,202 | 18,880 |
Total liabilities | 1,302,746 | 1,344,561 |
Commitments and contingencies | ||
Stockholders’ equity | ||
Preferred stock, par value $0.005, 50,000,000 shares authorized; no shares issued and outstanding as of December 31, 2023 and December 31, 2022 | 0 | 0 |
Common stock, par value $0.005, 500,000,000 shares authorized; 71,129,801 and 70,025,733 shares issued as of December 31, 2023 and December 31, 2022, respectively; 54,773,662 and 54,013,826 shares outstanding as of December 31, 2023 and December 31, 2022, respectively | 355 | 350 |
Treasury stock at cost, 16,356,139 and 16,011,907 shares as of December 31, 2023 and December 31, 2022, respectively | (272,573) | (253,551) |
Additional paid-in capital | 1,206,627 | 1,135,284 |
Accumulated deficit | (357,651) | (118,927) |
Accumulated other comprehensive loss | (8,567) | (8,589) |
Total stockholders’ equity, attributable to Envestnet, Inc. | 568,191 | 754,567 |
Non-controlling interest | 6,315 | 13,037 |
Total equity | 574,506 | 767,604 |
Total liabilities and equity | $ 1,877,252 | $ 2,112,165 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 71,129,801 | 70,025,733 |
Common stock, shares outstanding (in shares) | 54,773,662 | 54,013,826 |
Treasury stock, shares (in shares) | 16,356,139 | 16,011,907 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue: | |||
Total revenue | $ 1,245,620,000 | $ 1,239,784,000 | $ 1,186,517,000 |
Operating expenses: | |||
Direct expense | 473,038,000 | 470,424,000 | 423,723,000 |
Employee compensation | 444,828,000 | 490,725,000 | 432,829,000 |
General and administrative | 210,113,000 | 218,831,000 | 171,657,000 |
Depreciation and amortization | 130,304,000 | 125,828,000 | 117,767,000 |
Goodwill impairment | 191,818,000 | 0 | 0 |
Total operating expenses | 1,450,101,000 | 1,305,808,000 | 1,145,976,000 |
Income (loss) from operations | (204,481,000) | (66,024,000) | 40,541,000 |
Other income (expense): | |||
Interest income | 6,288,000 | 4,184,000 | 827,000 |
Interest expense | (25,138,000) | (16,843,000) | (16,931,000) |
Other income (expense), net | (9,666,000) | 264,000 | (4,076,000) |
Total other income (expense), net | (28,516,000) | (12,395,000) | (20,180,000) |
Income (loss) before income tax provision | (232,997,000) | (78,419,000) | 20,361,000 |
Income tax provision | 12,777,000 | 7,061,000 | 7,667,000 |
Net income (loss) | (245,774,000) | (85,480,000) | 12,694,000 |
Add: Net loss attributable to non-controlling interest | 7,050,000 | 4,541,000 | 602,000 |
Net income (loss) attributable to Envestnet, Inc. | $ (238,724,000) | $ (80,939,000) | $ 13,296,000 |
Net income (loss) attributable to Envestnet, Inc. per share: | |||
Basic (in dollars per share) | $ (4.38) | $ (1.47) | $ 0.24 |
Diluted (in dollars per share) | $ (4.38) | $ (1.59) | $ 0.24 |
Weighted average common shares outstanding: | |||
Basic (in shares) | 54,457,365 | 55,199,482 | 54,470,975 |
Diluted (in shares) | 54,457,365 | 56,842,125 | 55,384,096 |
Total recurring revenue | |||
Revenue: | |||
Total revenue | $ 1,209,968,000 | $ 1,216,072,000 | $ 1,163,365,000 |
Asset-based | |||
Revenue: | |||
Total revenue | 745,238,000 | 738,228,000 | 709,376,000 |
Operating expenses: | |||
Direct expense | 434,123,000 | 430,345,000 | 393,717,000 |
Subscription-based | |||
Revenue: | |||
Total revenue | 464,730,000 | 477,844,000 | 453,989,000 |
Operating expenses: | |||
Direct expense | 30,814,000 | 32,577,000 | 29,445,000 |
Professional services and other revenue | |||
Revenue: | |||
Total revenue | 35,652,000 | 23,712,000 | 23,152,000 |
Operating expenses: | |||
Direct expense | $ 8,101,000 | $ 7,502,000 | $ 561,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) attributable to Envestnet, Inc. | $ (238,724) | $ (80,939) | $ 13,296 |
Other comprehensive income (loss), net of tax: | |||
Foreign currency translation adjustments | 22 | (6,690) | (1,501) |
Total other comprehensive income (loss), net of tax | 22 | (6,690) | (1,501) |
Comprehensive income (loss) attributable to Envestnet, Inc. | $ (238,702) | $ (87,629) | $ 11,795 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Treasury Stock | Additional Paid-in Capital | Additional Paid-in Capital Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | Accumulated Deficit | Accumulated Deficit Cumulative Effect, Period of Adoption, Adjustment | Non-controlling Interest |
Beginning balance (in shares) at Dec. 31, 2020 | 67,832,706 | |||||||||
Balance at period start at Dec. 31, 2020 | $ 975,818 | $ (79,842) | $ 339 | $ (110,466) | $ 1,166,774 | $ (108,470) | $ (398) | $ (79,912) | $ 28,628 | $ (519) |
Treasury stock, beginning balance (in shares) at Dec. 31, 2020 | (13,739,171) | |||||||||
Increase (decrease) in shareholders' equity | ||||||||||
Net income (loss) | 12,694 | 13,296 | (602) | |||||||
Other comprehensive loss, net of tax | (1,501) | (1,501) | ||||||||
Stock-based compensation expense | 67,525 | 67,525 | ||||||||
Issuance of common stock, vesting of RSUs and PSUs (in shares) | 891,466 | |||||||||
Issuance of common stock, vesting of RSUs and PSUs | 5 | $ 5 | ||||||||
Shares withheld to satisfy tax withholdings (in shares) | (291,405) | |||||||||
Net cash paid related to tax withholding for stock-based compensation | (20,529) | $ (20,529) | ||||||||
Proceeds from the exercise of stock options (in shares) | 76,303 | |||||||||
Proceeds from the exercise of stock options | 2,090 | 2,090 | ||||||||
Capital contribution, non-controlling interest | 3,201 | (127) | 3,328 | |||||||
Issuance of common stock (in shares) | 78,677 | |||||||||
Issuance of common stock | 4,068 | 4,068 | ||||||||
Share repurchases (in shares) | (55,488) | |||||||||
Net cash paid related to share repurchases | (4,001) | $ (4,001) | ||||||||
Other | 14 | (232) | 246 | |||||||
Ending balance (in shares) at Dec. 31, 2021 | 68,879,152 | |||||||||
Balance at period end at Dec. 31, 2021 | 959,542 | $ 344 | $ (134,996) | 1,131,628 | (1,899) | (37,988) | 2,453 | |||
Treasury stock, ending balance (in shares) at Dec. 31, 2021 | (14,086,064) | |||||||||
Increase (decrease) in shareholders' equity | ||||||||||
Net income (loss) | (85,480) | (80,939) | (4,541) | |||||||
Other comprehensive loss, net of tax | (6,690) | (6,690) | ||||||||
Stock-based compensation expense | 79,581 | 79,581 | ||||||||
Issuance of common stock, vesting of RSUs and PSUs (in shares) | 1,063,779 | |||||||||
Issuance of common stock, vesting of RSUs and PSUs | 6 | $ 6 | ||||||||
Shares withheld to satisfy tax withholdings (in shares) | (356,201) | |||||||||
Net cash paid related to tax withholding for stock-based compensation | (23,516) | $ (23,516) | ||||||||
Proceeds from the exercise of stock options (in shares) | 82,802 | |||||||||
Proceeds from the exercise of stock options | 2,620 | 2,620 | ||||||||
Capital contribution, non-controlling interest | 16,037 | 1,288 | 14,749 | |||||||
Share repurchases (in shares) | (1,569,642) | |||||||||
Net cash paid related to share repurchases | (95,039) | $ (95,039) | ||||||||
Purchase of Capped Call Transactions | (79,585) | (79,585) | ||||||||
Other | $ 128 | (248) | 376 | |||||||
Ending balance (in shares) at Dec. 31, 2022 | 54,013,826 | 70,025,733 | ||||||||
Balance at period end at Dec. 31, 2022 | $ 767,604 | $ 350 | $ (253,551) | 1,135,284 | (8,589) | (118,927) | 13,037 | |||
Treasury stock, ending balance (in shares) at Dec. 31, 2022 | (16,011,907) | (16,011,907) | ||||||||
Increase (decrease) in shareholders' equity | ||||||||||
Net income (loss) | $ (245,774) | (238,724) | (7,050) | |||||||
Other comprehensive loss, net of tax | 22 | 22 | ||||||||
Stock-based compensation expense | 71,031 | 70,719 | 312 | |||||||
Issuance of common stock, vesting of RSUs and PSUs (in shares) | 1,031,658 | |||||||||
Issuance of common stock, vesting of RSUs and PSUs | 5 | $ 5 | ||||||||
Shares withheld to satisfy tax withholdings (in shares) | (344,232) | |||||||||
Net cash paid related to tax withholding for stock-based compensation | (19,022) | $ (19,022) | ||||||||
Proceeds from the exercise of stock options (in shares) | 72,410 | |||||||||
Proceeds from the exercise of stock options | $ 1,608 | 1,608 | ||||||||
Share repurchases (in shares) | 0 | 0 | ||||||||
Net cash paid related to share repurchases | $ (1,008) | $ 0 | (984) | (24) | ||||||
Purchase of Capped Call Transactions | (79,600) | |||||||||
Other | $ 40 | 0 | 40 | |||||||
Ending balance (in shares) at Dec. 31, 2023 | 54,773,662 | 71,129,801 | ||||||||
Balance at period end at Dec. 31, 2023 | $ 574,506 | $ 355 | $ (272,573) | $ 1,206,627 | $ (8,567) | $ (357,651) | $ 6,315 | |||
Treasury stock, ending balance (in shares) at Dec. 31, 2023 | (16,356,139) | (16,356,139) |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Statement of Stockholders' Equity [Abstract] | |
Accounting Standards Update [Extensible List] | Accounting Standards Update 2020-06 [Member] |
Debt issuance costs and taxes | $ 7,641 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (245,774,000) | $ (85,480,000) | $ 12,694,000 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 130,304,000 | 125,828,000 | 117,767,000 |
Deferred income taxes | (1,479,000) | (3,490,000) | (320,000) |
Goodwill impairment | 191,818,000 | 0 | 0 |
Non-cash compensation expense | 71,031,000 | 80,333,000 | 68,020,000 |
Non-cash interest expense | 5,037,000 | 7,445,000 | 5,799,000 |
Fair market value adjustment to investment in private company | (804,000) | (400,000) | (758,000) |
Dilution gain on equity method investee share issuance | (546,000) | (9,517,000) | 0 |
Loss allocations from equity method investments | 10,579,000 | 8,874,000 | 7,093,000 |
Lease related impairments | 5,120,000 | 15,750,000 | 1,537,000 |
Loss on property and equipment disposals | 0 | 5,097,000 | 0 |
Payments of contingent consideration | 0 | 0 | (2,360,000) |
Fair market value adjustment to contingent consideration liability | 0 | 0 | (1,067,000) |
Gain on settlement of liability | 0 | 0 | (1,206,000) |
Other | 1,781,000 | 1,266,000 | 2,793,000 |
Changes in operating assets and liabilities: | |||
Fees receivable, net | (20,584,000) | (5,031,000) | (16,731,000) |
Prepaid expenses and other assets | (11,573,000) | (16,090,000) | 3,140,000 |
Accounts payable, accrued expenses and other liabilities | 19,229,000 | (24,257,000) | 56,256,000 |
Deferred revenue | 729,000 | (305,000) | (2,080,000) |
Net cash provided by operating activities | 154,868,000 | 98,355,000 | 250,577,000 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (18,995,000) | (16,172,000) | (23,731,000) |
Capitalization of internally developed software | (94,307,000) | (89,153,000) | (65,170,000) |
Acquisitions of businesses, net of cash acquired | 0 | (104,100,000) | (32,794,000) |
Investments in private companies | (4,175,000) | (16,351,000) | (25,926,000) |
Acquisition of proprietary technology | (17,000,000) | (19,000,000) | (28,517,000) |
Issuance of loan receivable to private company | (20,000,000) | 0 | 0 |
Issuance of note receivable to equity method investees | 0 | (6,350,000) | 0 |
Other | 414,000 | 0 | 0 |
Net cash used in investing activities | (154,063,000) | (251,126,000) | (176,138,000) |
Cash flows from financing activities: | |||
Proceeds from borrowings under Revolving Credit Facility | 55,000,000 | 0 | 0 |
Payments related to Revolving Credit Facility | (55,000,000) | 0 | 0 |
Settlement of Convertible Notes due 2023 | (45,000,000) | 0 | 0 |
Payments related to Capped Call Transactions | 0 | (79,585,000) | 0 |
Proceeds from exercise of stock options | 1,608,000 | 2,620,000 | 2,090,000 |
Payments related to tax withholdings for stock-based compensation | (19,022,000) | (23,516,000) | (20,529,000) |
Payments related to share repurchases | (9,289,000) | (85,750,000) | (4,001,000) |
Purchase of non-controlling units from third-party shareholders | (1,008,000) | 0 | 0 |
Proceeds from capital contributions of non-controlling shareholders | 0 | 16,037,000 | 3,201,000 |
Payments of contingent consideration | 0 | (743,000) | (9,276,000) |
Other | 5,000 | (1,866,000) | (655,000) |
Net cash used in financing activities | (72,706,000) | (108,320,000) | (29,170,000) |
Effect of exchange rate on changes on cash, cash equivalents and restricted cash | 1,106,000 | (6,164,000) | (555,000) |
Net change in cash, cash equivalents and restricted cash | (70,795,000) | (267,255,000) | 44,714,000 |
Cash, cash equivalents and restricted cash, beginning of period | 162,173,000 | 429,428,000 | 384,714,000 |
Cash, cash equivalents and restricted cash, end of period | 91,378,000 | 162,173,000 | 429,428,000 |
Net cash paid for income taxes | 15,866,000 | 12,120,000 | 7,920,000 |
Cash paid for interest | 20,101,000 | 11,046,000 | 11,132,000 |
Supplemental disclosure of non-cash activities | |||
Purchase of fixed assets included in accounts payable and accrued expenses and other current liabilities | 710,000 | 4,206,000 | 1,328,000 |
Right-of-use assets obtained in exchange for lease liabilities, net | 1,395,000 | 13,211,000 | 4,596,000 |
Conversion of equity method investee loan to shares | 4,129,000 | 2,623,000 | 0 |
Treasury stock purchases included in accrued expenses and other liabilities | 0 | 9,289,000 | 0 |
Membership interest liabilities included in other liabilities | 0 | 752,000 | 496,000 |
Common stock issued to settle purchase liability | 0 | 0 | 4,068,000 |
Internally developed software costs included in accrued expenses and other liabilities | 0 | 0 | 591,000 |
Leasehold improvements funded by lease incentive | 0 | 0 | 164,000 |
Purchase liabilities included in accrued expenses and other liabilities | 0 | 0 | 2,951,000 |
Convertible Notes due 2023 | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Gain (loss) on extinguishment of debt | 0 | 13,421,000 | 0 |
Cash flows from financing activities: | |||
Repurchase of convertible debt | 0 | (312,422,000) | 0 |
Convertible Notes due 2025 | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Gain (loss) on extinguishment of debt | 0 | (15,089,000) | 0 |
Cash flows from financing activities: | |||
Repurchase of convertible debt | 0 | (181,772,000) | 0 |
Convertible Notes due 2027 | |||
Cash flows from financing activities: | |||
Proceeds from convertible debt | 0 | 575,000,000 | 0 |
Debt issuance cost | $ 0 | $ (16,323,000) | $ 0 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Envestnet, through its subsidiaries, is transforming the way financial advice and insight are delivered. Its mission is to empower financial advisors and service providers with innovative technology, solutions and intelligence. Envestnet is a leader in helping transform wealth management, working towards its goal of expanding a holistic financial wellness ecosystem so that its clients can better serve their clients. Envestnet is organized around two business segments based on clients served and products provided to meet those needs. Financial information about each business segment is contained in “Note 23—Segment Information”. The business segments are as follows: • Envestnet Wealth Solutions – a leading provider of comprehensive and unified wealth management software, services and solutions to empower financial advisors and institutions to enable them to deliver holistic advice to their clients. Envestnet Wealth Solutions serves its clients principally through the following product and service suites: • Envestnet | Enterprise provides an end-to-end open architecture wealth management platform, through which advisors can construct portfolios for clients. It begins with aggregated household data which then leads to the creation of a financial plan, asset allocation, investment strategy, portfolio management, rebalancing and performance reporting. Advisors have access to approximately 23,000 investment products. Envestnet | Enterprise also sells data aggregation and reporting, data analytics and digital advice capabilities to customers. • Envestnet | Wealth Analytics delivers an end-to-end platform experience that transforms data into actionable intelligence that informs its client's next best course of action. The insights foster the acceleration of data-driven strategy with enterprise-level analytics including clients, fees, opportunities, attrition, benchmarking and firm valuation. • Envestnet | Tamarac provides leading trading, rebalancing, portfolio accounting, performance reporting and client relationship management software, principally to high‑end RIAs. • Envestnet | MoneyGuide provides leading goal-based financial planning solutions to the financial services industry. The highly adaptable software helps financial advisors add significant value for their clients using best-in-class technology with enhanced integrations to generate financial plans. • Envestnet | Workplace Solutions offers a comprehensive suite of services for advisor-sold retirement plans. It's retirement solutions address the regulatory, data, and investment needs of retirement plans and delivers the information holistically. Workplace Solutions includes is a digital 401(k) retirement plan marketplace that streamlines retirement plan distribution and due diligence among financial advisors and third-party administrators. With Envestnet's retirement solutions marketplace, advisors can employ Envestnet's outsourced fiduciary services for investment selection and monitoring in retirement plan portfolios and can access essential information to make investment recommendations and understand the impact of fund changes to the total cost of their plans. • Envestnet | PMC ® , or Portfolio Management Consultants provides research and consulting services to assist advisors in creating investment solutions for their clients. These solutions include over 5,000 vetted third-party managed account products, multi-manager portfolios, and fund strategist portfolios, as well as approximately 850 proprietary products, such as quantitative portfolios and fund strategist portfolios. PMC also offers portfolio overlay and tax optimization services. • Envestnet | Billing Solutions (Redi2) offers revenue management and hosted fee-billing solutions in the global financial services industry. Redi2's platform enables fee calculation, invoice creation, payouts and accounting, and billing compliance. Redi2 solutions caters to different segments of the market with three different product lines: Revenue Manager which provides client revenue accounting and billing services for asset managers; Wealth Manager which delivers multi-party billing and payouts for broker-dealers and turnkey asset management programs and BillFin™ which offers advisory billing and invoicing for financial advisors. • Envestnet Data & Analytics – a leading provider of financial data aggregation, analytics and digital experiences to meet the needs of financial institutions, enterprise FinTech firms and market investment research firms worldwide. Envestnet Data & Analytics serves two primary markets: • Open Banking provides personal financial management, wealth management, payments, credit/lending, business financial management and enterprise business intelligence solutions for retail and commercial banks, credit unions, credit card providers, wealth management firms, FinTech firms, E-commerce and payment solution providers. • Alternative Data provides de-identified consumer spending insights for investment research and corporate and marketing research clients. For a summary of commonly used industry terms and abbreviations used in this annual report on Form 10-K, see the Glossary of Terms. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies The Company follows accounting standards established by FASB to ensure consistent reporting of financial condition, results of operations and cash flows. References to GAAP in these notes are to the FASB ASC and ASUs. Segment Reporting —On October 1, 2023, the Company changed the composition of its reportable segments to reflect the way that the Company's chief operating decision maker reviews the operating results, assesses performance and allocates resources. As a result, the advisor-focused Wealth Analytics business has been reclassified from the Envestnet Data & Analytics segment to the Envestnet Wealth Solutions segment. The segment change does not impact nonsegment results or the Company's consolidated balance sheets, consolidated statements of operations or consolidated statements of cash flows. All segment information presented within this Annual report on Form 10-K for the year ended December 31, 2023 is presented in conjunction with the current organizational structure, with prior periods adjusted accordingly. Correction of Immaterial Error —During the fourth quarter of 2023, the Company identified that the arrangement with a third-party for the use of cloud hosted virtual servers which was previously accounted for as a finance lease transaction and included as a component of property and equipment, net in the consolidated balance sheets should have been recognized as a prepayment included within prepaid expenses and other current assets and other assets in the consolidated balance sheets. The Company concluded that the classification of these transactions was immaterial in prior period financial statements and that amendment of previously filed reports was not required. However, the Company corrected this immaterial error in the prior years reported within this Annual Report on Form 10-K for the year ended December 31, 2023. In the consolidated balance sheets as of December 31, 2022, these adjustments resulted in an increase to prepaid expenses and other current assets of $6.1 million, an increase to other assets of $7.9 million and a corresponding decrease to property and equipment, net of $14.0 million. In the consolidated statements of operations for the year ended December 31, 2022, these adjustments resulted in an increase in direct expense of $2.0 million, an increase in general and administrative expense of $2.7 million and a corresponding decrease in depreciation and amortization expense of $4.7 million. In the consolidated statements of cash flows for the year ended December 31, 2022, these adjustments resulted in a decrease in net cash provided by operating activities of $18.7 million and a corresponding decrease in net cash used in financing activities of $18.7 million. Principles of Consolidation —The consolidated financial statements include the accounts of Envestnet and its subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Foreign Currency —Accounts for the Envestnet Wealth Solutions segment that are denominated in a non-U.S. currency have been remeasured using the U.S. dollar as the functional currency. Certain accounts within the Envestnet Data & Analytics segment are recorded and measured in foreign currencies. The assets and liabilities for those subsidiaries with a functional currency other than the U.S. dollar are translated at exchange rates in effect at the balance sheet date, and revenue and expenses are translated at average exchange rates. Differences arising from these foreign currency translations are recorded in the consolidated balance sheets as accumulated other comprehensive income (loss) within stockholders' equity. The Company is also subject to gains and losses from foreign currency denominated transactions and the remeasurement of foreign currency denominated balance sheet accounts, both of which are included in other income (expense), net in the consolidated statements of operations. Management Estimates —Management has made certain estimates and assumptions relating to the reporting of assets, liabilities, revenue and expenses and the disclosure of contingent assets and liabilities to prepare these consolidated financial statements in conformity with GAAP. Areas requiring the use of management estimates relate to estimating uncollectible receivables, revenue recognition, valuations and assumptions used for impairment testing of goodwill, intangible and other long-lived assets, right-of-use assets, performance shares issued, contingent consideration, realization of deferred tax assets, uncertain tax positions, sales tax liabilities, operating lease liabilities, commitments and contingencies and assumptions used to allocate purchase prices in business combinations. Actual results could differ materially from these estimates under different assumptions or conditions. Reclassifications —Certain amounts in the consolidated balance sheets as of December 31, 2023 and December 31, 2022 and the consolidated statements of cash flows for years ended December 31, 2023, 2022 and 2021 have been reclassified to conform to the current period presentation. These reclassifications did not change the previously reported total assets, total liabilities and equity, or net change in cash and cash equivalents and did not affect the consolidated statements of operations, consolidated statements of comprehensive income (loss) or consolidated statements of stockholders' equity. Revenue Recognition The Company accounts for its revenue arrangements in accordance with ASC 606. The Company derives revenue from asset-based and subscription-based services and professional services and other sources. Revenue is recognized when control of these services is transferred to the Company's customers, in an amount that reflects the consideration that we expect to be entitled to in exchange for those services. All revenue recognized in the consolidated statements of operations is considered to be revenue from contracts with customers. Sales and usage-based taxes are excluded from revenue. The majority of the Company's revenue is recognized when services are provided. Asset-Based Recurring Revenue —Asset-based recurring revenue primarily consist of fees for providing customers continuous access to platform services through the Company’s uniquely customized platforms. These platform services include investment manager research, portfolio diagnostics, proposal generation, investment model management, rebalancing and trading, portfolio performance reporting and monitoring solutions, billing and back office and middle-office operations and administration and are made available to customers throughout the contractual term from the date the customized platform is launched. The asset-based fees the Company earns are generally based upon variable percentages of assets managed or administered on its platforms. The fee percentage varies based on the level and type of services the Company provides to its customers, as well as the values of existing customer accounts. The values of the customer accounts are affected by inflows or outflows of customer funds and market fluctuations. The platform services are substantially the same over each quarter and performed in a similar manner over the contract period, and are considered stand-ready promises. The platform services that are delivered to the customer over the quarter are considered distinct, as the customer benefits distinctly from each increment of the Company's services and each quarter is separately identified in the contract, and are considered to be a single performance obligation. The pricing generally resets each quarter and the pricing structure is consistent throughout the term of the contract. The variable fees are generally calculated and billed quarterly in advance based on preceding quarter-end values and the variable amounts earned from the platform services relate specifically to the benefits transferred to the customer during that month or quarter. Accordingly, revenue is allocated to the specific quarter in which services are performed. The asset-based contracts generally contain one performance obligation and revenue is recognized on a ratable basis over the quarter beginning on the date that the platform services are made available to the customer as the customer simultaneously consumes and receives the benefits of the services. All asset-based fees are recognized in the Envestnet Wealth Solutions segment. For certain services provided by third parties, the Company evaluates whether it is the principal (revenue reported on a gross basis) or agent (revenue reported on a net basis). Generally, the Company reports customer fees including charges for third party service providers where the Company has a direct contract with such third party service providers on a gross basis, whereas the amounts billed to its customers are recorded as revenue, and amounts paid to third party service providers are recorded as direct expense. The Company is the principal in the transaction because it controls the services before they are transferred to its customers. Control is evidenced by the Company being primarily responsible to its customers and having discretion in establishing pricing. Subscription-Based Recurring Revenue —Subscription-based recurring revenue primarily consist of fees for providing customers continuous access to the Company’s platform for wealth management and financial wellness. The subscription-based fees generally include fixed fees and or usage-based fees. Generally, the subscription services are substantially the same over each quarter and performed in a similar manner over the contract period, and are considered stand-ready promises. Quarterly subscription services are considered distinct as the customer can benefit from each increment of services on its own and each quarter is separately identified in the contract, and services are considered to be a single performance obligation. Certain subscription-based contracts include fixed and variable consideration. The amount of variable consideration that is included in the transaction price may be subject to constraint and included in the subscription-based recurring revenue only to the extent that is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. The Company utilizes the expected value method to estimate variable consideration based on available historical, current, and forecasted information. The usage-based pricing generally resets each quarter and the pricing structure is generally consistent throughout the term of the contract. The fixed fees are generally calculated and billed quarterly in advance. The usage-based fees are generally calculated and are billed either monthly or quarterly based on the actual usage and relate specifically to the benefits transferred to the customer during that quarter. Accordingly, revenue is allocated to the specific quarter in which services are performed. Fixed fees are generally recognized on a ratable basis over the quarter beginning when the subscription services are made available to the customer, as the customer simultaneously receives and consumes the benefits of the subscription services. Usage-based revenue is recognized on a monthly basis as the customer receives and consumes the benefit as the Company provides the services. Subscription-based fees are recognized in both the Envestnet Wealth Solutions and Envestnet Data & Analytics segments. Professional Services and Other Revenue —The Company earns professional services fees by providing contractual customized services and platform software development as well as initial implementation fees. Professional services contracts generally have one performance obligation, fixed prices, and generally specify the deliverables in the contract. Certain professional services contracts are billed on a time and materials basis and revenue is recognized over time as the services are performed. For contracts billed on a fixed price basis, revenue is recognized over time based on the proportion of services performed. Initial implementation fees are fixed and are generally recognized ratably over the contract term. Other revenue is not significant and primarily includes revenue related to the Advisor Summit which is recognized when the event is held. Professional services and other revenue is recognized in both the Envestnet Wealth Solutions and Envestnet Data & Analytics segments. Arrangements with Multiple Performance Obligations —Certain of the Company’s contracts with customers contain multiple performance obligations, such as a platform services performance obligation and a professional services performance obligation. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. Standalone selling prices of services are estimated based on observable transactions when these services are sold on a standalone basis or based on expected cost plus margin. Remaining Performance Obligations —Remaining performance obligations represent the transaction price allocated to unsatisfied or partially satisfied performance obligations. The disclosure includes estimates of variable consideration. The Company applies the practical expedients and exemption not to disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less; (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed; and (iii) contracts for which the variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct service that forms part of a single performance obligation. Contract Balances —The Company records contract liabilities (deferred revenue) when cash payments are received in advance of its performance. The term between invoicing date and when payment is due is generally not significant. For the majority of its arrangements, the Company requires advance quarterly payments before the services are delivered to the customer. Deferred Revenue —Deferred revenue primarily consists of implementation fees, professional services and subscription fee payments received in advance from customers. Deferred Sales Incentive Compensation —Sales incentive compensation earned by the Company’s sales force is considered an incremental and recoverable cost to acquire a contract with a customer. Sales incentive compensation for initial contracts is deferred and amortized on a straight-line basis over the period of benefit. The Company determined the period of benefit by taking into consideration its customer contracts, life of the technology and other factors. Sales incentive compensation for renewal contracts are deferred and amortized on a straight-line basis over the related contractual renewal period. Deferred sales incentive compensation is included in other assets in the consolidated balance sheets and amortization expense is included in employee compensation expenses in the consolidated statements of operations. The Company has applied the practical expedient to recognize the incremental costs of obtaining contracts as an expense when incurred if the amortization period would have been one year or less. These costs are included in employee compensation expense in the consolidated statements of operations. Direct Expense —Direct expense primarily includes expenses related to third party investment management and clearing, custody and brokerage services. Generally, these expenses are calculated based upon a contractual percentage of the market value of assets held in customer accounts measured as of the end of each quarter and are recognized ratably throughout the quarter based on the number of days in the quarter. Also included in direct expense are vendor specific expenses related to the direct support of revenue associated with the Envestnet Data & Analytics products. Allowance for Doubtful Accounts —The Company evaluates the need for an allowance for doubtful accounts for potentially uncollectible fees receivable. In establishing the amount of the allowance, if any, customer-specific information is considered related to delinquent accounts, including historical loss experience and current economic conditions. As of December 31, 2023 and 2022, the Company’s allowance for doubtful accounts was $2.3 million and $2.6 million, respectively. Cash and Cash Equivalents —The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents are recorded at cost, which approximates fair value. The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents. Restricted Cash —The following table reconciles cash, cash equivalents and restricted cash from the consolidated balance sheets to amounts reported in the consolidated statements of cash flows: December 31, 2023 2022 2021 (in thousands) Cash and cash equivalents $ 91,378 $ 162,173 $ 429,279 Restricted cash included in prepaid expenses and other current assets — — 149 Total cash, cash equivalents and restricted cash $ 91,378 $ 162,173 $ 429,428 Investments —The Company has investments in private companies for which it has significant influence that are recorded using the equity method of accounting. The Company uses the equity method of accounting because of its less than 50% ownership and/or lack of control in these companies. These investments are included in other assets in the consolidated balance sheets. The Company records the portion of its earnings or losses in these privately held companies’ net income or loss on a one quarter lag from the actual results of operations as a component of other income (expense), net in the consolidated statements of operations. The Company reviews all investments on a regular basis to evaluate the carrying amount and economic viability. This evaluation process is based on information that the Company requests directly from these investees and includes, but is not limited to, the review of the investee’s cash position, financing needs, earnings/revenue outlook, operational performance, management/ownership changes and competition. As this information is not subject to the same disclosure regulations as U.S. publicly traded companies, the basis for these evaluations is subject to the timing and accuracy of the data received from these investees. When a review of an investee’s operations indicates that there is a decline in its value and it has been determined that this decline is other than temporary, the Company assesses the investment for impairment. Impaired investments are written down to estimated fair value. Fair value is estimated using a variety of valuation methodologies, including comparing the investee with publicly traded companies in similar lines of business, applying valuation multiples to estimated future operating results and analyzing estimated discounted future cash flows. For the year ended December 31, 2023 an impairment, or downward adjustment due to observable transactions, of $2.0 million was recognized for these investments. No such charge was recognized for the years ended December 31, 2022 and 2021. For investments where the Company owns equity interests in privately held companies though does not have significant influence and there is no readily determinable fair value, it accounts for the investment under the measurement alternative at cost minus impairment, if any, plus or minus fair value changes when there are observable price changes. Property and Equipment —Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment, outside of leasehold improvements and land, is computed using the straight-line method based on estimated useful lives of the depreciable assets. Leasehold improvements are amortized on a straight-line basis over their estimated economic useful lives or the remaining lease term, whichever is shorter. Improvements are capitalized, while repairs and maintenance costs are charged to operations as incurred. Assets are reviewed for recoverability whenever events or circumstances indicate the carrying value may not be recoverable. There were immaterial impairments of property and equipment for the year ended December 31, 2023 and 2021. There were $5.1 million of impairments of property and equipment for the year ended December 31, 2022. Internally Developed Software for Internal Use —Costs incurred in the preliminary stages of development are expensed as incurred. Once an application has reached the development stage, internal and external costs, if direct and incremental, are capitalized until the software is substantially complete and ready for its intended use. Capitalization ceases upon completion of all substantial testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Maintenance and training costs are expensed as incurred. Internally developed software is amortized on a straight-line basis over its estimated useful life. Management evaluates the useful lives of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. There were immaterial impairments of internally developed software for internal use for the years ended December 31, 2023, 2022 and 2021. Goodwill —Goodwill consists of the excess of the purchase price over the fair value of identifiable net assets of businesses acquired. Goodwill is reviewed for impairment each year using a qualitative or quantitative process that is performed at least annually or whenever events or circumstances indicate a likely reduction in the fair value of a reporting unit below its carrying amount. The Company has concluded that it has two reporting units. The Company performs the annual impairment analysis on October 31 in order to provide management time to complete the analysis prior to year-end. Prior to performing the quantitative evaluation, an assessment of qualitative factors may be performed to determine whether it is more likely than not that the fair value of a reporting unit exceeds the carrying value. If it is determined that it is unlikely that the carrying value exceeds the fair value, the Company is not required to complete the quantitative goodwill impairment evaluation. If it is determined that the carrying value may exceed fair value when considering qualitative factors, a quantitative goodwill impairment evaluation is performed. When performing the quantitative evaluation, if the carrying value of the reporting unit exceeds its fair value, an impairment loss equal to the difference will be recorded. No goodwill impairment charges were recorded for the years ended December 31, 2022 and 2021. See "Note 10—Goodwill" for a discussion of the impairment analysis for the year ended December 31, 2023. Intangible Assets —Intangible assets are recorded at cost less accumulated amortization. Amortization of intangible assets is computed using the straight-line method based on estimated useful lives of the assets. Intangible assets are reviewed for impairment whenever events or changes in circumstances may affect the recoverability of the net assets. Such reviews include an analysis of current results and take into consideration the undiscounted value of projected operating cash flows. No material intangible asset impairment charges have been recorded for the years ended December 31, 2023, 2022 and 2021. Leases —The Company accounts for its leases in accordance with ASC 842 and has elected the available package of practical expedients as well as elected to apply the short-term lease exemption to all of its classes of underlying assets. At inception, the Company determines if an arrangement is a lease. Operating leases are included in ROU assets, operating lease liabilities and operating lease liabilities, net of current portion in the Company's consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the remaining lease term. The operating lease ROU asset also includes prepaid payments and excludes lease incentives. As none of the Company's leases provide an implicit rate, the Company uses an estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. The Company has elected the practical expedient to account for non-lease components as part of the lease component for all asset classes. The majority of the Company's lease agreements are real estate leases. Fair Value Measurements —The Company accounts for its fair value measurements in accordance with ASC 825, which provides companies the option to report selected financial assets and liabilities at fair value and also requires entities to display the fair value of the selected assets and liabilities on the face of the balance sheets. The Company has not elected the ASC 825-10 option to report selected financial assets and liabilities at fair value. ASC 825-10 also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect of the Company’s choice to use fair value on its earnings. Financial assets and liabilities recorded at fair value in the consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels: Level I: Inputs based on quoted market prices in active markets for identical assets or liabilities at the measurement date. Level II: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or inputs that are observable and can be corroborated by observable market data. Level III: Inputs reflect management’s best estimates and assumptions of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments. The carrying amount of financial assets and liabilities, which consist primarily of cash and cash equivalents, fees receivable, net and accounts payable, accrued expenses and other current liabilities, approximate their fair value due to their short-term nature. Income Taxes —The Company uses the asset and liability method to account for income taxes. 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 net operating loss 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company records a valuation allowance to reduce deferred tax assets to an amount that is more likely than not to be realized. The Company follows authoritative guidance related to how uncertain tax positions should be recognized, measured, disclosed and presented in the consolidated financial statements. This requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained “when challenged” or “when examined” by the applicable tax authority. The tax benefits recognized in the consolidated financial statements from tax positions are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Business Combinations —The Company accounts for business combinations under the acquisition method. The cost of an acquired company is assigned to the tangible and intangible assets acquired and the liabilities assumed on the basis of their fair values at the date of acquisition. The determination of fair values of assets acquired and liabilities assumed requires management to make estimates and use valuation techniques when market values are not readily available. Any excess of purchase price over the fair value of net tangible and intangible assets acquired is allocated to goodwill. Transaction costs associated with business combinations are expensed as incurred. The Company determines the fair value of contingent consideration payable on the acquisition date using a discounted cash flow approach utilizing an appropriate discount rate. Each reporting period thereafter, the Company revalues these obligations and records increases or decreases in their fair value as adjustments to fair market value adjustment to contingent consideration in the Company’s consolidated statements of operations. Changes in the fair value of the contingent consideration payable can result from adjustments to the estimated revenue forecasts included in the contingent consideration calculations. Stock-Based Compensation —Compensation cost relating to stock-based awards made to employees and directors is recognized in the consolidated financial statements using the Black-Scholes option-pricing model in the case of stock option awards, and intrinsic value in the case of restricted stock awards. The Company measures the cost of such awards based on the estimated fair value of the award measured at the grant date and recognizes the expense on a straight-line basis over the requisite service period, which is the vesting period. Determining the fair value of stock options requires the Company to make several estimates, including the volatility of its stock price, the expected life of the option, forfeiture rate, dividend yield and interest rates. The Company estimates the expected life of its options using historical internal forfeiture data. The Company estimates stock-price volatility using historical third-party quotes of the Company's common stock. The Company utilizes a risk-free interest rate, which is based on the yield of U.S. zero coupon securities with a maturity equal to the expected life of the options. The Company has not and does not expect to pay dividends on its common shares. The Company is required to estimate expected forfeitures of stock-based awards at the grant date and recognize compensation cost only for those awards expected to vest. The forfeiture assumption is ultimately adjusted to the actual forfeiture rate. Therefore, changes in the forfeiture assumptions may impact the total amount of expense ultimately recognized over the vesting period. Estimated forfeitures will be reassessed in subsequent periods and may change based on new facts and circumstances. Convertible Notes —The Convertible Notes are accounted for in accordance with ASC 470. The Company has determined that the embedded conversion options in the Convertible Notes are not required to be separately accounted for as a derivative under GAAP. Upon adoption of ASU 2020-06, the Company accounts for the Convertible Notes as a single liability measured at amortized cost. Capped Call Transactions —In November 2022, the Company entered into the Capped Call Transactions with the Capped Call Counterparties. The Capped Call Transactions initially cover the number of shares of the Company's common stock underlying the Convertible Notes due 2027, subject to customary anti-dilution |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions 2021 Acquisitions Acquisition of Proprietary Technology The Company previously owned approximately 29% of the outstanding units in a privately held company and accounted for it as an equity method investment. On March 11, 2021, the Company entered into an intellectual property purchase agreement with this privately held company to acquire all of the proprietary technology developed by the privately held company for approximately $35.5 million. Concurrent with the intellectual property purchase agreement, the Company also entered into a redemption agreement with the same privately held company to redeem the Company's previously held equity interest for approximately $10.0 million. The Company accounted for these two arrangements as a single unit of account. As of the acquisition date, the net cost of the proprietary technology acquired, including capitalized transaction costs, was approximately $24.5 million, which will be amortized over a five-year period on a straight-line basis. The proprietary technology has been integrated into the Envestnet Wealth Solutions segment. Acquisition of Harvest On April 7, 2021, pursuant to an agreement and plan of merger, dated as of March 31, 2021, between, among others, Harvest, a Delaware corporation, and Bounty Merger Sub, a wholly-owned subsidiary of the Company, the Company completed the merger of Harvest with and into Bounty Merger Sub, with Merger Sub continuing as the surviving corporation and operating as a wholly-owned subsidiary of Envestnet. Harvest has been integrated into the Envestnet Wealth Solutions segment. Harvest provides automated goals-based saving and wealth solutions tools to customers of banks, credit unions, trust companies, and other financial institutions. The acquisition optimizes the Company's API-based financial wellness ecosystem, and also helps strengthen the Company's foothold to enable embedded finance, which the Company sees as a key driver of the future of financial services. In connection with the Harvest merger, the Company paid consideration of $32.8 million, net of cash acquired (of which approximately $3.0 million was held in escrow for 18 months after the closing date). The Company funded the acquisition with cash on hand. The following table summarize the final fair values of the assets acquired and liabilities assumed as of the acquisition date (in thousands): Tangible assets acquired, net of cash received $ 5,310 Identifiable intangible assets 9,500 Goodwill 18,526 Total assets acquired 33,336 Total liabilities assumed (542) Total net assets acquired, net of cash received $ 32,794 The goodwill arising from the acquisition represents the expected synergistic benefits of the transaction, primarily related to an increase in future revenue as a result of potential cross selling opportunities, as well as enhancements to the Company's existing technologies. The goodwill is not deductible for income tax purposes. A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Proprietary technology $ 6,900 6 Straight-line Customer list 2,600 14 Accelerated Total intangible assets acquired $ 9,500 The results of Harvest’s operations are included in the consolidated statements of operations beginning April 7, 2021 and were not considered material to the Company’s results of operations. The Company’s acquisition related costs included in general and administrative expense in the consolidated statements of operations were not material for the years ended December 31, 2023 and 2022. 2022 Acquisitions Acquisition of 401kplans.com On May 31, 2022, Envestnet Retirement Solutions, LLC, a wholly-owned subsidiary of the Company, acquired all of the issued and outstanding membership interests of 401kplans.com. 401kplans.com has been integrated into the Envestnet Wealth Solutions segment. 401kplans.com provides a digital 401(k) retirement plan marketplace that streamlines retirement plan distribution and due diligence among financial advisors and third-party administrators. The acquisition demonstrates Envestnet's commitment to the retirement plan industry and is expected to create a more seamless experience and enhance productivity for advisors by helping them shop, compare and select the best-fitting 401(k) plan for their clients. In connection with the 401kplans.com acquisition, the Company paid consideration of $14.5 million, net of cash acquired. The Company funded the acquisition with available cash resources. The following table summarizes the fair values of the assets acquired as of the date of acquisition (in thousands): Tangible assets acquired, net of cash received $ 104 Identifiable intangible assets 3,000 Goodwill 11,396 Total net assets acquired, net of cash received $ 14,500 The goodwill arising from the acquisition represents the expected benefits of the transaction, primarily related to the enhancement of the Company's existing technologies and increase in future revenue as a result of potential cross selling opportunities. The goodwill is expected to be deductible for income tax purposes. A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Proprietary technology $ 3,000 5 Straight-line The results of 401kplans.com's operations are included in the consolidated statements of operations beginning May 31, 2022 and are not considered material to the Company’s results of operations. The Company’s acquisition related costs included in general and administrative expense in the consolidated statements of operations were not material for the year ended December 31, 2023 and 2022. Acquisition of Truelytics On July 1, 2022, pursuant to an agreement and plan of merger, dated as of May 10, 2022, between, among others, Truelytics, Yodlee and Quadrant Merger Sub, a wholly-owned subsidiary of the Company, the Company completed the merger of Truelytics with and into Quadrant Merger Sub, with Truelytics continuing as the surviving corporation and a wholly owned subsidiary of Envestnet. Truelytics has been integrated into the Envestnet Wealth Solutions segment. The acquisition of Truelytics aligns with the Company's strategy to further connect its ecosystem by creating transformative progress for its advisors and clients. Truelytics is an advisor transition management platform and the first end-to-end data-driven system to help wealth management and insurance enterprises attract, grow, and retain advisory businesses, while also reducing the costs related to advisor transitions. The Truelytics platform combines Envestnet data, analytics, and wealth technology to further support advisors across the ecosystem. In connection with the Truelytics merger, the Company paid cash consideration of $20.7 million, net of cash acquired. The Company funded the Truelytics acquisition with available cash resources. The following table summarizes the fair values of the assets acquired as of the date of acquisition (in thousands): Tangible assets acquired, net of cash received $ 510 Identifiable intangible assets 4,000 Goodwill 16,217 Total net assets acquired, net of cash received $ 20,727 The goodwill arising from the acquisition represents the expected benefits of the transaction, primarily related to the enhancement of the Company's existing technologies and increase in future revenue as a result of potential cross selling opportunities. The goodwill is not expected to be deductible for income tax purposes. A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Proprietary technology $ 4,000 5 Straight-line The results of Truelytics' operations are included in the consolidated statements of operations beginning July 1, 2022 and are not considered material to the Company’s results of operations. The Company’s acquisition related costs included in general and administrative expense in the consolidated statements of operations were not material for the year ended December 31, 2023 and 2022. Acquisition of Redi2 On July 1, 2022, pursuant to a stock purchase agreement, dated as of June 24, 2022, between Envestnet and Redi2, Envestnet completed the acquisition of all of the issued and outstanding shares of Redi2. Redi2 provides revenue management and hosted fee-billing solutions. Its platform enables fee calculation, invoice creation, payouts and accounting, and billing compliance. Redi2 has been integrated into the Envestnet Wealth Solutions segment. In connection with the Redi2 acquisition, the Company paid consideration of $68.9 million, net of cash acquired. The Company funded the Redi2 acquisition with available cash resources. In addition, the Company has agreed to pay up to $20.0 million in performance bonuses based upon the achievement of certain performance targets, which will be recognized as employee compensation expense in the consolidated statement of operations. The Company recognized $2.4 million related to these performance bonuses during the year ended December 31, 2023 and an immaterial amount for the year ended December 31, 2022. The following table summarizes the fair values of the assets acquired as of the date of acquisition (in thousands): Current assets, net of cash received $ 1,985 Other assets 3,321 Identifiable intangible assets 26,500 Goodwill 46,467 Total assets acquired 78,273 Accounts payable and accrued expenses (2,428) Operating lease liabilities (2,201) Deferred revenue (4,771) Total liabilities assumed (9,400) Total net assets acquired, net of cash received $ 68,873 The goodwill arising from the acquisition represents the expected benefits of the transaction, primarily related to the enhancement of the Company's existing technologies and increase in future revenue as a result of potential cross selling opportunities. Goodwill of $40.7 million is expected to be deductible for income tax purposes. A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Customer lists $ 14,000 14-16 years Accelerated Proprietary technologies 9,500 6 years Straight-line Trade names 3,000 6-7 years Straight-line Total intangible assets acquired $ 26,500 The Company completed the acquisition accounting related to the Redi2 acquisition during the year ended December 31, 2023. The results of operations of Redi2 are included in the consolidated statements of operations beginning July 1, 2022 and are not considered material to the Company’s results of operations. The Company’s acquisition related costs included in general and administrative expense in the consolidated statements of operations were not material for the year ended December 31, 2023 and $1.5 million for the year ended December 31, 2022. Pro Forma Financial Information The results of the Company's acquisitions since January 1, 2021 were not considered material to the Company's results of operations, therefore, pro forma information is not presented. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 31, 2023 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: December 31, 2023 2022 (in thousands) Prepaid technology $ 14,630 $ 16,649 Prepaid data servers 7,991 6,059 Income tax prepayments and receivables 9,625 2,515 Non-income tax receivables 4,041 5,488 Prepaid insurance 2,785 2,881 Other 12,400 13,830 Total prepaid expenses and other current assets $ 51,472 $ 47,422 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net consisted of the following: December 31, Depreciable Life 2023 2022 (in thousands) Computer equipment and software 3 years $ 61,852 $ 67,230 Leasehold improvements Lesser of estimated useful life or life of lease 38,296 36,158 Office furniture and fixtures 3-7 years 11,333 10,796 Office equipment and other 3-5 years 15,114 11,563 Building and building improvements 7-39 years 2,729 2,729 Land Not applicable 940 940 Total property and equipment 130,264 129,416 Less: accumulated depreciation (82,041) (80,935) Total property and equipment, net $ 48,223 $ 48,481 During the year ended December 31, 2023, the Company retired property and equipment that was no longer in service with a historical cost of $12.9 million within the Envestnet Wealth Solutions segment and $1.2 million within the Envestnet Data & Analytics segment. During the year ended December 31, 2022, the Company retired property and equipment that was no longer in service with a historical cost of $20.0 million within the Envestnet Wealth Solutions segment and $10.4 million within the Envestnet Data & Analytics segment. The following table presents the cost amounts and related accumulated depreciation written off by category: Year Ended December 31, 2023 Year Ended December 31, 2022 Accumulated Accumulated Cost Depreciation Cost Depreciation (in thousands) Computer equipment and software $ 12,269 $ (12,267) $ 15,887 $ (14,947) Leasehold improvements 934 (860) 2,442 (1,209) Office furniture and fixtures 721 (551) 660 (418) Office equipment and other 149 (57) 11,467 (8,785) Total property and equipment retirements $ 14,073 $ (13,735) $ 30,456 $ (25,359) |
Internally Developed Software,
Internally Developed Software, Net | 12 Months Ended |
Dec. 31, 2023 | |
Capitalized Computer Software, Net [Abstract] | |
Internally Developed Software, Net | Internally Developed Software, Net Internally developed software, net consisted of the following: December 31, Estimated Useful Life 2023 2022 (in thousands) Internally developed software 5 years $ 405,078 $ 313,200 Less: accumulated amortization (180,365) (128,642) Internally developed software, net $ 224,713 $ 184,558 |
Geographical Information
Geographical Information | 12 Months Ended |
Dec. 31, 2023 | |
Segments, Geographical Areas [Abstract] | |
Geographical Information | Geographical Information The following table sets forth certain long-lived assets including property and equipment, net and internally developed software, net by geographic area: December 31, 2023 2022 (in thousands) United States $ 270,381 $ 231,855 India 2,555 1,093 Other — 91 Total long-lived assets, net $ 272,936 $ 233,039 See “Note 18—Revenue and Direct Expense” for detail of revenue by geographic area. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, Net | Intangible Assets, Net Intangible assets, net consisted of the following: December 31, 2023 December 31, 2022 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount (in thousands) Customer lists $ 604,080 $ (327,042) $ 277,038 $ 604,080 $ (285,288) $ 318,792 Proprietary technologies 93,058 (37,052) 56,006 113,224 (59,401) 53,823 Trade names 15,700 (10,676) 5,024 15,700 (8,320) 7,380 Total intangible assets $ 712,838 $ (374,770) $ 338,068 $ 733,004 $ (353,009) $ 379,995 During the year ended December 31, 2023, the Company retired fully amortized intangible assets, including proprietary technologies, with a historical cost of $40.5 million within the Envestnet Wealth Solutions segment and had no retirements of intangible assets within the Envestnet Data & Analytics segment. During the year ended December 31, 2022, the Company retired fully amortized intangible assets, including proprietary technologies, with a historical cost of $2.5 million within the Envestnet Wealth Solutions segment and retired fully amortized intangible assets, including proprietary technologies and trade names, with a historical cost of $25.1 million within the Envestnet Data & Analytics segment. During June 2021, the Company entered into a purchase agreement with a privately held company to acquire the technology solutions being developed by this privately held company for a purchase price of $18.0 million, including an advance of $3.0 million. The Company closed the transaction and paid the remaining $15.0 million in February 2022. This proprietary technology asset has been integrated into the Envestnet Wealth Solutions segment and is being amortized over an estimated useful life of five years. In addition, the agreement included an earn-out payment of $10.0 million based upon the achievement of certain target metrics within five years after the date of the Company’s launch of the technology solutions. During April 2022, the Company entered into a separate purchase agreement with this same privately held company to acquire technology solutions being developed by this privately held company for a purchase price of $9.0 million, including an advance of $4.0 million. The purchase agreement was amended in January 2023 to include additional functionality and features for additional consideration of $5.0 million. The Company closed the transaction and paid the remaining $10.0 million during the three months ended March 31, 2023. This proprietary technology asset has been integrated into the Envestnet Wealth Solutions segment and is being amortized over an estimated useful life of five years. During May 2023, the Company entered into a separate purchase agreement with this same privately held company to acquire technology solutions for a purchase price of $7.0 million, including an advance of $2.0 million. In addition, the prior purchase agreements that were entered into with this privately held Company in June 2021 and April 2022 were amended in May 2023 to remove the earn-out payment provisions. The Company closed the transaction and paid the remaining $5.0 million during the three months ended December 31, 2023. The proprietary technology asset has been integrated into the Envestnet Wealth Solutions segment and is being amortized over an estimated useful life of five years. The estimated future amortization expense of the Company's intangible assets as of December 31, 2023 was as follows (in thousands): 2024 $ 57,368 2025 53,973 2026 46,448 2027 37,672 2028 30,296 Thereafter 112,311 Total $ 338,068 |
Depreciation and Amortization E
Depreciation and Amortization Expense | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Depreciation and Amortization Expense | Depreciation and Amortization Expense Depreciation and amortization expense consisted of the following: Year Ended December 31, 2023 2022 2021 (in thousands) Intangible asset amortization $ 62,927 $ 71,901 $ 68,587 Internally developed software amortization 52,422 36,959 28,603 Property and equipment depreciation 14,955 16,968 20,577 Total depreciation and amortization $ 130,304 $ 125,828 $ 117,767 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Goodwill Changes in the carrying amount of goodwill by reportable segment were as follows: Envestnet Envestnet Total (in thousands) Balance as of December 31, 2021 $ 636,246 $ 288,908 $ 925,154 Goodwill recognized from acquisitions 74,080 — 74,080 Foreign currency translation — (820) (820) Balance as of December 31, 2022 710,326 288,088 998,414 Goodwill impairment — (191,818) (191,818) Foreign currency translation — (33) (33) Balance as of December 31, 2023 $ 710,326 $ 96,237 $ 806,563 Goodwill Impairment |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Assets | Other Assets On January 31, 2023, the Company entered into a Convertible Promissory Note with a customer of the Company's business, a privately held company, whereby the Company was issued a convertible promissory note with a principal amount of $20.0 million and a stated interest rate of 8.0% per annum. The Convertible Promissory Note has a maturity date of January 31, 2026 and is convertible into common stock or preferred stock of the privately held company upon qualified financing events or corporate transactions. During the year ended December 31, 2023, interest income related to the Convertible Promissory Note included in interest income in the consolidated statements of operations was $1.5 million. In connection with the Convertible Promissory Note, the Company concurrently entered into a call option agreement with the privately held company, which provides the Company an option to acquire the privately held company at a predetermined price as of the earlier of July 2024 or upon satisfaction of certain financial metrics. The financial metrics were met during the year ended December 31, 2023; however, the Company did not exercise the call option. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investments | Investments Equity Method Investments The Company owns equity interests in various privately held companies for which it has significant influence and, therefore, recognizes its investment under the equity method. Equity method investments are initially recorded at cost. Under the equity method of accounting, the investment is adjusted for the Company ’s proportionate share of earnings or losses, dividends, capital contributions and changes in ownership interests. As of December 31, 2023, the Company ’s ownership interests in these companies ranged from approximately 4% to 55%. As of December 31, 2022, the Company ’s ownership interests in these companies ranged from approximately 3% to 48%. As of December 31, 2023 and 2022, the carrying value of the Company’s equity method investments was $33.5 million and $37.4 million, respectively, which are included in other assets in the consolidated balance sheets. As of December 31, 2023, the Company has committed $8.8 million in future funding to certain of these equity method investees. Summarized combined financial information for these investments was as follows (amounts represent 100% of investee financial information, except Envestnet ’ s proportional share of losses): December 31, 2023 2022 (in thousands) Current assets $ 68,602 $ 42,059 Other assets $ 66,016 $ 50,703 Current liabilities $ 17,150 $ 17,647 Other liabilities $ 1,857 $ 9,437 Year Ended December 31, 2023 2022 2021 (in thousands) Revenue $ 71,815 $ 79,062 $ 65,085 Loss from operations $ (16,733) $ (8,896) $ (149) Net loss $ (20,235) $ (7,124) $ (134) Envestnet ’s proportional share of gains (losses) (1) $ (10,033) $ 643 $ (7,093) __________________________________________________________ (1) The years ended December 31, 2023 and 2022 include a $0.5 million and $9.5 million dilution gain on equity method investee share issuance, respectively. Envestnet's proportional share of gains (losses) from the Company ’s equity method investments are included in other income (expense), net in the consolidated statements of operations. The Company has an approximate 3.76% membership interest in a private services company that it accounts for using the equity method of accounting and is considered to be a related party. Revenue from the private services company totaled $12.3 million, $16.0 million and $16.4 million in the years ended December 31, 2023, 2022 and 2021, respectively. As of December 31, 2023 and 2022, the Company had recorded a net receivable of $1.7 million and $2.0 million, respectively, from the private services company. During the year ended December 31, 2022, the Company recognized a $2.6 million dilution gain on this investment. During the first quarter of 2022, the Company funded a $2.5 million convertible loan to a privately held company that is accounted for under the equity method. During the second quarter of 2022, this privately held company raised additional preferred equity which reduced the Company's ownership to 41.0% and the Company's convertible loan was converted. As a result of this transaction, the Company recorded a $6.9 million dilution gain during the second quarter of 2022, which is included in other income (expense), net in the consolidated statements of operations. During the third quarter of 2022, the Company acquired additional membership units in this privately held company for $8.4 million which increased its ownership interest to 48.0%. The Company uses the equity method of accounting to record its portion of this privately held company's net income or loss on a one quarter lag from the actual results of operations. After this unit purchase, the Company's investment in this privately held company exceeded its proportionate share of its net assets by approximately $7.8 million, which represents amortizable intangible assets. The Company will recognize amortization of this basis difference prospectively over a period of 5 years. This amortization will be included within Envestnet's proportional share of income (loss) in other income (expense), net in the consolidated statements of operations. During the second quarter of 2022, the Company acquired an approximate 25.0% interest in a privately held company for cash consideration of $5.0 million and subject to the occurrence of certain conditions, the Company agreed to invest up to an additional $10.0 million for additional units in the future. During 2023, the Company contributed an additional $2.5 million, decreasing the future additional commitment to $7.5 million. The Company uses the equity method of accounting to record its portion of this privately held company's net income or loss on a one quarter lag from the actual results of operations. The Company uses the equity method of accounting because of its less than 50% ownership interest and lack of control and does not otherwise exercise control over the significant economic and operating decisions of the privately held company. Other Equity Investments The Company owns equity interests in various privately held companies for which it does not have significant influence, there is no readily determinable fair value, and its investment qualifies for recognition under the measurement alternative at cost minus impairment, if any, plus or minus fair value changes when there are observable price changes. As of December 31, 2023 and December 31, 2022, the carrying value of these other equity investments was $22.8 million and $22.1 million, respectively, which are included in other assets in the consolidated balance sheets. For the year ended December 31, 2023, an impairment, or downward adjustment due to observable transactions, of $2.0 million was recognized for these investments. No such charge was recognized for the year ended December 31, 2022. Fair value adjustments, resulting from observable price changes, of $2.8 million and $0.4 million were recognized during the years ended December 31, 2023 and 2022, respectively. These adjustments are included in other income (expense), net in the consolidated statements of operations. |
Accounts Payable, Accrued Expen
Accounts Payable, Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Accounts Payable, Accrued Expenses and Other Current Liabilities | Accounts Payable, Accrued Expenses and Other Current Liabilities Accounts payable, accrued expenses and other current liabilities consisted of the following: December 31, 2023 2022 (in thousands) Accrued investment manager fees $ 106,612 $ 99,851 Accrued compensation and related taxes 72,466 77,939 Accounts payable 35,738 11,271 Accrued professional services 14,289 10,762 Accrued technology 4,151 6,393 Accrued interest 2,473 3,091 Accrued treasury stock purchases — 9,289 Other accrued expenses 5,695 15,270 Total accrued expenses and other current liabilities $ 241,424 $ 233,866 During the year ended December 31, 2022, the Company entered into an outsourcing arrangement with TCS to increase operational scale and business agility. Under this agreement, the Company began to outsource certain administrative and operational services of the Envestnet Data & Analytics segment located in Bangalore, India. Additionally, as part of an organizational realignment in the fourth quarter of 2022, the Company entered into separation agreements with a number of employees. This realignment will allow Envestnet to operate more efficiently and prioritize activities and services that will benefit its clients and the future of its business. In connection with the outsourcing arrangement with TCS, the fourth quarter 2022 organizational realignment and various other severance activity, the Company recognized $30.1 million in total severance expense during the year ended December 31, 2022. During the year ended December 31, 2023, as part of a reduction in force initiative, the Company entered into separation agreements with a number of employees. In connection with this reduction in force initiative that began in the first quarter of 2023, as well as the fourth quarter 2022 organizational realignment, the Company incurred $35.4 million in total severance expense for the year ended December 31, 2023. As of December 31, 2023 the Company had an ending liability balance of $10.3 million related to these efforts, of which the Company anticipates approximately $9.2 million to be paid during 2024, with the remaining balance paid through 2030. The following table presents a reconciliation of the beginning and ending liability balance related to these efforts, which is primarily included within accrued compensation and related taxes in the table above. Envestnet Wealth Solutions Envestnet Data & Analytics Nonsegment Total (in thousands) Balance as of December 31, 2021 $ 4,670 $ 810 $ — $ 5,480 Severance 13,237 10,745 6,135 30,117 Cash payments (5,325) (8,769) (6,135) (20,229) Balance as of December 31, 2022 12,582 2,786 — 15,368 Severance 17,232 11,813 6,354 35,399 Cash payments (20,021) (14,113) (6,354) (40,488) Balance as of December 31, 2023 $ 9,793 $ 486 $ — $ 10,279 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt The following tables set forth the carrying value and estimated fair value of the Company's debt obligations as of December 31, 2023 and 2022: December 31, 2023 Issuance Amount Unamortized Issuance Costs Carrying Value Fair Value (Level II) (in thousands) Revolving Credit Facility $ — $ — $ — $ — Convertible Notes due 2025 317,500 (2,968) 314,532 294,958 Convertible Notes due 2027 575,000 (12,920) 562,080 571,746 Total debt $ 892,500 $ (15,888) $ 876,612 $ 866,704 December 31, 2022 Issuance Amount Unamortized Issuance Costs Carrying Value Fair Value (Level II) (in thousands) Revolving Credit Facility $ — $ — $ — $ — Convertible Notes due 2023 45,000 (114) 44,886 46,058 Convertible Notes due 2025 317,500 (4,765) 312,735 293,688 Convertible Notes due 2027 575,000 (15,966) 559,034 606,119 Total debt $ 937,500 $ (20,845) $ 916,655 $ 945,865 Revolving Credit Facility On February 4, 2022, the the Company entered into the Revolving Credit Facility with a group of banks for which Bank of Montreal is acting as administrative agent. The Revolving Credit Facility amended and restated, in its entirety, the Company's prior credit agreement. In connection with entering into the Revolving Credit Facility, the Company capitalized $1.9 million of deferred financing charges to other assets in the consolidated balance sheets and wrote off $0.6 million of pre-existing finance charges to other income (expense), net in the consolidated statements of operations. The Revolving Credit Facility provides for a $500.0 million revolving line of credit, including a sub-facility for a $20.0 million letter of credit, and is set to mature in February 2027. There were no amounts outstanding under the Revolving Credit Facility as of December 31, 2023 and December 31, 2022. Obligations under the Revolving Credit Facility are guaranteed by substantially all of Envestnet’s U.S. subsidiaries and are secured by a first-priority lien on substantially all of the personal property (other than intellectual property) of Envestnet and the guarantors, subject to certain exclusions. In the event the Company has borrowings under the Revolving Credit Facility, at the Company's option, it will pay interest on these borrowings at a rate equal to either (i) a base rate plus an applicable margin ranging from 0.25% to 1.75% per annum or (ii) an adjusted Term SOFR plus an applicable margin ranging from 1.25% to 2.75% per annum, in each case based upon the total net leverage ratio, as calculated pursuant to the Revolving Credit Facility. There is also a commitment fee at a rate ranging from 0.25% to 0.30% per annum based upon the total net leverage ratio. As of December 31, 2023 and December 31, 2022, debt issuance costs related to the Revolving Credit Facility included in prepaid expenses and other current assets in consolidated balance sheets were $0.7 million and $0.7 million, respectively, and included in other assets in the consolidated balance sheets were $1.5 million and $2.2 million, respectively. The Revolving Credit Facility contains customary conditions, representations and warranties, affirmative and negative covenants, mandatory prepayment provisions and events of default. The covenants include certain financial covenants requiring the Company to maintain compliance with a maximum total leverage ratio and a minimum interest coverage ratio. On February 20, 2024, the Company entered into a Waiver with respect to the Revolving Credit Facility, between the Company, the Guarantors party thereto from time to time, the Lenders party thereto from time to time and Bank of Montreal, as administrative agent. Under the Waiver, the Lenders party thereto waived the events of default resulting from the non-compliance with the Total Leverage Ratio financial covenant for the fiscal quarters ended on March 31, 2023 and June 30, 2023. The Company was in compliance with all other covenants in the Revolving Credit Facility as of December 31, 2023. Convertible Notes In May 2018, the Company issued $345.0 million of Convertible Notes due 2023. The Convertible Notes due 2023 bore interest at a rate of 1.75% per annum payable semiannually in arrears on June 1 and December 1 of each year. In November 2022, the Company repurchased $300.0 million aggregate principal of the outstanding Convertible Notes due 2023 for cash consideration of approximately $312.4 million and recognized a loss on extinguishment of approximately $13.4 million included within interest expense in the consolidated statements of operations. The Convertible Notes due 2023 matured on June 1, 2023. Upon maturity, the Company settled the remaining aggregate principal amount on the Convertible Notes due 2023 for $45.0 million. The Convertible Notes due 2023 were paid using a combination of cash on hand and borrowings under the Company's Revolving Credit Facility. No shares of the Company's common stock were issued upon settlement of the Convertible Notes due 2023. In August 2020, the Company issued $517.5 million of Convertible Notes due 2025 that mature on August 15, 2025. The Convertible Notes due 2025 bear interest at a rate of 0.75% per annum payable semiannually in arrears in cash on February 15 and August 15 of each year. In November 2022, the Company repurchased $200.0 million aggregate principal of the outstanding Convertible Notes due 2025 for cash consideration of approximately $181.8 million and recognized a gain on extinguishment of approximately $15.1 million within interest expense in the consolidated statements of operations. As of December 31, 2023, the Convertible Notes due 2025 could result in approximately 3.0 million shares issuable upon conversion, subject to adjustment under certain conditions. In November 2022, the Company issued $575.0 million of Convertible Notes due 2027 that mature on December 1, 2027. The Convertible Notes due 2027 bear interest at a rate of 2.625% per annum payable semiannually in arrears in cash on June 1 and December 1 of each year. As of December 31, 2023, the Convertible Notes due 2027 could result in approximately 7.8 million shares issuable upon conversion, subject to adjustment under certain conditions. The Convertible Notes are general unsecured senior obligations, subordinated in right of payment to the Company’s obligations under its Credit Agreement. The Convertible Notes rank equally in right of payment with all of the Company’s other existing and future senior indebtedness and will be senior in right of payment to any of the Company’s future subordinated obligations. The Convertible Notes will be structurally subordinated to the indebtedness and other liabilities of any of the Company’s subsidiaries, other than its wholly owned subsidiary, Envestnet Asset Management, Inc., which will fully and unconditionally guarantee the Convertible Notes on an unsecured basis, and other than to the extent the Convertible Notes are guaranteed in the future by any of the Company's other subsidiaries as described in the indenture and will be effectively subordinated to and future secured indebtedness to the extent of the value of the assets securing such indebtedness. Upon the occurrence of a “fundamental change,” as defined in the indenture, the holders may require the Company to repurchase all or a portion of the Convertible Notes for cash at 100% of the principal amount of the Convertible Notes being purchased, plus any accrued and unpaid interest. The Company may redeem for cash all or any portion of the Convertible Notes due 2025 and the Convertible Notes due 2027, at the Company's option, on or after August 15, 2023 and December 5, 2025, respectively, if the last reported sale price of the Company's common stock has been at least 130% of the conversion price then in effect for at least 20 trading days, consecutive or non-consecutive, within a 30 consecutive trading day period ending on, and including, any of the five The Convertible Notes due 2025 and the Convertible Notes due 2027 are convertible into shares of the Company's common stock under certain circumstances prior to maturity at an initial shares per one thousand principal amount conversion rate of 9.3682 and 13.6304, respectively, which represents a conversion price per share, subject to adjustment under certain conditions, of $106.74 and $73.37, respectively. The initial conversion rate is subject to adjustment upon a "fundamental change", as defined in the indenture, if the Company calls all or any portion of the Convertible Notes for optional redemption, or subject to anti-dilution provisions provided in the indenture. Holders may convert the Convertible Notes due 2025 and the Convertible Notes due 2027 at their option at any time prior to the close of business on the business day immediately preceding February 15, 2025 and June 1, 2027, respectively, only under the following circumstances: (a) during any calendar quarter commencing after the calendar quarter ending on September 30, 2020 and December 31, 2022, respectively (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) in the period of 30 consecutive trading days ending on the last trading day of the calendar quarter immediately preceding the calendar quarter in which the conversion occurs, is more than 130% of the conversion price of the Convertible Notes in effect on each applicable trading day; (b) during the five five In connection with the pricing of the Convertible Notes due 2027, the Company entered into privately negotiated Capped Call Transactions for a total cost of approximately $79.6 million. The Capped Call Transactions initially cover the number of shares of the Company's common stock underlying the Convertible Notes due 2027, subject to customary anti-dilution adjustments. The Capped Call Transactions generally are expected to reduce the potential dilutive effect on the common stock upon any conversion of the Convertible Notes due 2027 and/or offset any potential cash payments the Company is required to make in excess of the principal amount of converted Convertible Notes due 2027, as the case may be, with such reduction and/or offset subject to a cap, subject to certain adjustments under the terms of the Capped Call Transactions. The Capped Call Transactions allow the Company to purchase shares of the Company's common stock at a strike price equal to the initial conversion price of $73.37 per share and are subject to a cap of $110.74 per share, subject to certain adjustments under the terms of the Capped Call Transactions. The options underlying the Capped Call Transactions can, at the Company’s option, remain outstanding until the maturity date for the Convertible Notes due 2027 of December 1, 2027, even if all or a portion of the Convertible Notes due 2027 are converted, repurchased or redeemed prior to such date. Interest Expense Interest expense was comprised of the following and is included in other income (expense), net in the consolidated statements of operations: Year Ended December 31, 2023 2022 2021 (in thousands) Convertible Notes interest $ 17,845 $ 10,897 $ 9,919 Amortization of debt discount and issuance costs (1) 5,655 4,678 5,745 Undrawn and other fees 1,255 1,268 1,267 Revolving Credit Facility interest 383 — — Total interest expense $ 25,138 $ 16,843 $ 16,931 __________________________________________________________ (1) For the year ended December 31, 2022, amount includes a net gain on the extinguishment of debt of $1.7 million related to the partial repurchase of Convertible Notes due 2023 and Convertible Notes due 2025. The effective interest rate of the Convertible Notes was equal to the stated interest rate plus the amortization of the debt issuance costs and is set forth below: December 31, 2023 2022 2021 Convertible Notes due 2023 N/A 2.4 % 2.4 % Convertible Notes due 2025 1.3 % 1.3 % 1.3 % Convertible Notes due 2027 3.2 % 3.2 % N/A |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Leases | Leases The Company has operating leases for corporate offices and certain equipment with various lease expiration dates through 2033. Certain leases include the option to extend or early terminate the agreement. The following table presents information for the Company's operating leases: Year Ended December 31, 2023 2022 2021 (in thousands, except weighted-averages) Total operating lease cost $ 17,549 $ 15,157 $ 18,600 Short-term lease cost $ 16,203 $ 12,445 $ 4,940 Weighted-average remaining lease term (in years) 8.5 9.2 9.8 Weighted-average discount rate 4.9 % 5.0 % 5.1 % Cash paid for amounts included in the measurement of lease liabilities $ 16,718 $ 15,748 $ 18,052 The Company did not have significant sublease income or variable lease cost for the years ended December 31, 2023, 2022 and 2021. Maturities of operating lease liabilities were as follows as of December 31, 2023 (in thousands): 2024 $ 18,204 2025 15,590 2026 15,450 2027 15,582 2028 15,889 Thereafter 59,316 Total lease payments 140,031 Less: imputed interest (26,292) Total operating lease liabilities $ 113,739 As a result of adverse market conditions and office closures, the Company wrote down operating lease right-of-use assets totaling $5.1 million, $13.0 million and $1.5 million during the years ended December 31, 2023, 2022 and 2021, respectively, which are included within general and administrative expense in the consolidated statements of operations. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity In 2016, the Company announced that its Board of Directors had authorized a share repurchase program under which the Company may repurchase up to 2,000,000 shares of the Company's common stock. The repurchase program has no termination date and may be suspended or discontinued at any time. No share repurchases were made during the year ended December 31, 2023. During the year ended December 31, 2022, the Company repurchased 1,569,642 shares of common stock under the share repurchase program for an aggregate purchase price of $95.0 million. As of December 31, 2023, 331,260 shares remained available under the share repurchase program. On December 20, 2018, the Company issued and sold to BlackRock warrants to purchase approximately 470,000 common shares at an exercise price of $65.16 per share, subject to customary anti-dilution adjustments. The warrants were exercisable at BlackRock’s option for four years from the date of issuance. The warrants were unexercised upon expiration on December 20, 2022. In December 2021, the Company issued 78,677 shares of the Company’s common stock for the settlement of liabilities connected with a prior acquisition. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following tables set forth the Company’s financial assets and liabilities measured at fair value on a recurring basis, based on the three-tier fair value hierarchy as described in detail in "Note 2—Summary of Significant Accounting Policies": December 31, 2023 Fair Value Level I Level II Level III (in thousands) Assets: Money market funds $ 51,653 $ 51,653 $ — $ — Assets to fund deferred compensation liability 10,961 — — 10,961 Total assets $ 62,614 $ 51,653 $ — $ 10,961 Liabilities: Deferred compensation liability $ 8,045 $ 8,045 $ — $ — Total liabilities $ 8,045 $ 8,045 $ — $ — December 31, 2022 Fair Value Level I Level II Level III (in thousands) Assets: Money market funds $ 2,628 $ 2,628 $ — $ — Assets to fund deferred compensation liability 10,074 — — 10,074 Total assets $ 12,702 $ 2,628 $ — $ 10,074 Liabilities: Deferred compensation liability $ 8,088 $ 8,088 $ — $ — Total liabilities $ 8,088 $ 8,088 $ — $ — The Company assesses the categorization of assets and liabilities by level at each measurement date, and transfers between levels are recognized on the actual date of the event or when changes in circumstances cause the transfer, in accordance with the Company’s accounting policy regarding the recognition of transfers between levels of the fair value hierarchy. There were no transfers between Levels I, II and III during the year ended December 31, 2023. The table below presents a reconciliation of the contingent consideration liability and assets used to fund the Company's deferred compensation liability, which are measured at fair value on a recurring basis using significant unobservable inputs (Level III): Contingent Consideration Liability Assets to Fund Deferred Compensation Liability (in thousands) Balance at December 31, 2021 $ 743 $ 11,140 Payments (743) — Contributions — 649 Fair value adjustments and fees — (1,715) Balance at December 31, 2022 — 10,074 Fair value adjustments and fees — 887 Balance at December 31, 2023 $ — $ 10,961 The fair market value of the assets used to fund the Company's deferred compensation liability is measured using the cash surrender value of the Company's life insurance premiums and is included in other assets in the consolidated balance sheets. Changes in fair value, if any, are recognized in the Company's earnings and included in general and administrative expense Fair Value of Debt Agreements The Company considered its Convertible Notes to be Level II liabilities as of December 31, 2023 and 2022, and used a market approach to calculate their respective fair values. The estimated fair value for each convertible note was determined based on estimated or actual bids and offers in an over-the-counter market on December 31, 2023 and December 31, 2022, respectively (See “Note 14—Debt”). |
Revenue and Direct Expense
Revenue and Direct Expense | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue and Direct Expense | Revenue and Direct Expense Disaggregation of Revenue The following tables present the Company’s revenue by segment disaggregated by major source: Year Ended December 31, 2023 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated (in thousands) Revenue: Asset-based $ 745,238 $ — $ 745,238 Subscription-based 325,398 139,332 464,730 Total recurring revenue 1,070,636 139,332 1,209,968 Professional services and other revenue 24,068 11,584 35,652 Total revenue $ 1,094,704 $ 150,916 $ 1,245,620 Year Ended December 31, 2022 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated (in thousands) Revenue: Asset-based $ 738,228 $ — $ 738,228 Subscription-based 310,217 167,627 477,844 Total recurring revenue 1,048,445 167,627 1,216,072 Professional services and other revenue 16,799 6,913 23,712 Total revenue $ 1,065,244 $ 174,540 $ 1,239,784 Year Ended December 31, 2021 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated (in thousands) Revenue: Asset-based $ 709,376 $ — $ 709,376 Subscription-based 280,076 173,913 453,989 Total recurring revenue 989,452 173,913 1,163,365 Professional services and other revenue 14,190 8,962 23,152 Total revenue $ 1,003,642 $ 182,875 $ 1,186,517 The following table presents the Company’s revenue disaggregated by geography, based on the billing address of the customer: Year Ended December 31, 2023 2022 2021 (in thousands) United States $ 1,223,246 $ 1,218,254 $ 1,166,251 International 22,374 21,530 20,266 Total revenue $ 1,245,620 $ 1,239,784 $ 1,186,517 Revenue associated with Fidelity, substantially all of which is included within the Envestnet Wealth Solutions segment, accounted for approximately 16%, 16% and 17% of the Company's total revenue for the years ended December 31, 2023, 2022 and 2021, respectively. No other customer accounted for more than 10% of the Company's total revenue. Remaining Performance Obligations As of December 31, 2023, the Company's estimated revenue expected to be recognized in the future related to performance obligations associated with existing customer contracts that are partially or wholly unsatisfied is approximately $534.2 million. We expect to recognize approximately 41% of this revenue in 2024, approximately 45% throughout 2025 and 2026, with the balance recognized thereafter. These remaining performance obligations are not indicative of revenue for future periods. Contract Balances Total deferred revenue increased $0.7 million for the year ended December 31, 2023 and $4.9 million for the year ended December 31, 2022, primarily the result of timing of cash receipts and revenue recognition. The majority of the Company's deferred revenue as of December 31, 2023 will be recognized over the course of the next twelve months. The amount of revenue recognized for the years ended December 31, 2023 and 2022 that was included in the opening deferred revenue balance was $35.6 million and $33.1 million, respectively. The majority of this revenue consists of subscription-based services and professional services arrangements. The amount of revenue recognized from performance obligations satisfied in prior periods was not material. Deferred Sales Incentive Compensation Deferred sales incentive compensation was $11.5 million and $11.0 million as of December 31, 2023 and 2022, respectively. Amortization expense for deferred sales incentive compensation was $4.8 million and $4.3 million for the years ended December 31, 2023 and 2022, respectively. Deferred sales incentive compensation is included in other assets in the consolidated balance sheets and amortization expense is included in employee compensation expense in the consolidated statements of operations. No significant impairment loss for capitalized costs was recorded for the years ended December 31, 2023 and 2022. Direct Expense The following table summarizes direct expense by revenue category: Year Ended December 31, 2023 2022 2021 (in thousands) Asset-based $ 434,123 $ 430,345 $ 393,717 Subscription-based 30,814 32,577 29,445 Professional services and other 8,101 7,502 561 Total direct expense $ 473,038 $ 470,424 $ 423,723 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation On June 22, 2010, the Board of Directors approved the 2010 Plan, effective upon the closing of the Company’s initial public offering. The 2010 Plan provides for the grant of options, stock appreciation rights, Full Value Awards (as defined in the 2010 Plan agreement) and cash incentive awards to employees, consultants and non-employee directors to purchase common stock, which vest over time and have a maximum ten-year contractual term. As approved by the Company’s shareholders, the 2010 Plan has since been amended whereby the maximum number of shares of common stock that may be delivered under the 2010 Plan is 12,375,000. Stock options and stock appreciation rights are granted with an exercise price no less than the fair-market-value price of the common stock at the date of the grant. As of December 31, 2023, the maximum number of options and restricted stock available for future issuance under the Company’s plans is 1,819,036. As a result of the PIEtech acquisition in 2019, the Company adopted the 2019 Equity Plan in order to make inducement grants to certain PIEtech employees who joined Envestnet | MoneyGuide. Envestnet agreed to grant at future dates, not earlier than the sixty day anniversary of the PIEtech Acquisition, up to 301,469 shares of Envestnet common stock in the form of RSUs and PSUs pursuant to the 2019 Equity Plan. The RSUs vest over time and the PSUs vest upon the achievement of meeting certain performance conditions as well as a subsequent service condition. The Company recognizes the estimated expense on a graded-vesting method over a requisite service period of three Company estimates the expected vesting amount and recognizes compensation expense only for those awards expected to vest. This estimate is reassessed by management each reporting period and may change based upon new facts and circumstances. Changes in assumptions impact the total amount of expense and are recognized over the vesting period. Stock-based compensation expense under the Company's plans was as follows: Year Ended December 31, 2023 2022 2021 (in thousands) Stock-based compensation expense $ 71,031 $ 79,581 $ 67,525 Tax effect on stock-based compensation expense (18,113) (20,293) (17,219) Net effect on income (loss) $ 52,918 $ 59,288 $ 50,306 The tax effect on stock-based compensation expense above was calculated using a blended statutory rate of 25.5% for each of the years ended December 31, 2023, 2022 and 2021, respectively. Stock Options There were no stock options granted during the years ended December 31, 2023 and 2022. The following assumptions were used to value options granted during the year ended December 31, 2021: Year Ended December 31, 2021 Weighted-average grant date fair value $ 31.23 Expected volatility 42.1 % Risk-free interest rate 0.4 % Expected dividend yield — % Expected term (in years) 6.5 The following tables summarize option activity under the Company’s plans: Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Life Aggregate Intrinsic Value (Years) (in thousands) Outstanding as of December 31, 2022 277,535 $ 40.07 Exercised (72,410) $ 25.07 Forfeited (2,959) $ 55.28 Outstanding and exercisable as of December 31, 2023 202,166 $ 45.22 1.6 $ 1,330 Year Ended December 31, 2023 2022 2021 (in thousands) Intrinsic value of options exercised $ 2,243 $ 2,650 $ 3,815 Cash received from exercises of stock options $ 1,608 $ 2,620 $ 2,090 As of December 31, 2023, there was no amount of unrecognized compensation expense related to stock options. Restricted Stock Units and Performance Stock Units Periodically, the Company grants restricted stock units and performance-based stock units to employees. Restricted stock units vest one-third on the first anniversary of the grant date and quarterly thereafter. Performance-based restricted units vest upon the achievement of certain pre-established business and financial metrics as well as a subsequent service condition. The business and financial metrics governing the vesting of these performance-based restricted stock units provide thresholds that dictate the number of shares to vest upon each evaluation date, which range from 0% to 150% of the original grant number. If these metrics are achieved, as defined in the individual grant terms, these shares would cliff vest three years from the grant date. The following is a summary of the activity for non-vested restricted stock units granted under the Company’s plans: RSUs PSUs Number of Shares Weighted-Average Grant Date Fair Value per Share Number of Shares Weighted-Average Grant Date Fair Value per Share Non-vested as of December 31, 2022 1,681,976 $ 72.69 259,049 $ 74.83 Granted 1,106,853 $ 61.01 40,010 $ 69.47 Vested (1,006,719) $ 72.75 (24,939) $ 107.10 Forfeited (332,857) $ 63.75 (51,062) $ 63.21 Non-vested as of December 31, 2023 1,449,253 $ 65.78 223,058 $ 72.92 At December 31, 2023, there was $67.4 million of unrecognized compensation expense related to non-vested restricted stock units, which the Company expects to recognize over a weighted-average period of 1.7 years. At December 31, 2023, there was $1.9 million of unrecognized compensation expense related to non-vested performance-based restricted stock units, which the Company expects to recognize over a weighted-average period of 1.1 years. |
Benefit Plan
Benefit Plan | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Benefit Plan | Benefit Plan |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income (loss) before income tax expense (benefit) was generated in the following jurisdictions: Year Ended December 31, 2023 2022 2021 (in thousands) Domestic $ (240,904) $ (89,000) $ 9,730 Foreign 7,907 10,581 10,631 Total $ (232,997) $ (78,419) $ 20,361 The components of the income tax expense (benefit) charged to operations are summarized as follows: Year Ended December 31, 2023 2022 2021 (in thousands) Current: Federal $ 8,774 $ 1,185 $ — State 4,894 6,964 3,488 Foreign 588 2,402 4,499 14,256 10,551 7,987 Deferred: Federal 2,138 (2,453) 4,021 State (4,399) (1,439) (3,548) Foreign 782 402 (793) (1,479) (3,490) (320) Total $ 12,777 $ 7,061 $ 7,667 Deferred tax assets (liabilities), net consisted of the following: December 31, 2023 2022 (in thousands) Deferred revenue $ 8,699 $ 8,945 Prepaid expenses and accrued expenses 6,663 8,847 Right-of-use assets (17,528) (20,388) Lease liabilities 29,497 31,328 Net operating loss and tax credit carryforwards 63,866 64,590 Property and equipment and intangible assets (84,139) (94,061) Stock-based compensation expense 9,215 10,559 Investment in partnerships (4,416) 2,836 Convertible Notes 16,754 20,440 R&D expenditures 68,543 43,956 Withholding taxes (5,035) (4,841) Other (865) 196 Total deferred tax assets, net 91,254 72,407 Less: valuation allowance (107,822) (88,603) Deferred tax liabilities, net $ (16,568) $ (16,196) The valuation allowance for deferred tax assets as of December 31, 2023 and 2022 was $107.8 million and $88.6 million, respectively. The change in the valuation allowance from 2022 to 2023 was primarily related to the increased deferred tax assets for R&D expenditures, original issue discount on convertible debt, and additional valuation allowance on state R&D tax credits and net operating loss carryforwards. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some or all of the deferred tax assets will be realized. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. A significant piece of objective negative evidence is the cumulative pre-tax loss incurred over the three years ended December 31, 2023. Such objective evidence limits the ability to consider other subjective evidence, such as the Company's projections for future growth. On the basis of this evaluation, as of December 31, 2023, a valuation allowance of $107.8 million has been recorded to record only the portion of the deferred tax asset that is more likely than not to be realized. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence, such as the Company's projections for growth. The expected income tax provision calculated at the statutory federal rate differs from the actual provision as follows: Year Ended December 31, 2023 2022 2021 (in thousands) Tax provision (benefit), at U.S. federal statutory tax rate $ (47,449) $ (15,515) $ 4,402 State income tax provision (benefit), net of federal benefit (440) (3,463) 856 Effect of stock-based compensation tax shortfall 3,394 717 (364) Effect of limitation on executive compensation 1,057 2,511 1,678 Effect of permanent items 447 869 661 Effect of India partnerships 1,366 1,644 1,422 Change in valuation allowance 19,219 26,974 5,660 Effect of change in state and foreign income tax rates 97 (254) (1,184) Uncertain tax positions 1,211 (617) 158 Research and development credits (11,189) (10,993) (5,695) Effect of goodwill impairment 40,282 — — Change in India indefinite reinvestment assertion 3,699 4,372 — Other 1,083 816 73 Income tax provision $ 12,777 $ 7,061 $ 7,667 At December 31, 2023, the Company had net operating loss carryforwards, before any uncertain tax position reserves, for federal income tax purposes of approximately $64 million available to offset future federal taxable income, if any, of which $27 million expire through 2036 and $37 million are carried forward indefinitely. In addition, as of December 31, 2023, the Company had net operating loss carryforwards for state income tax purposes of approximately $225 million available to reduce future income subject to income taxes. The state net operating loss carryforwards that are subject to expiration expire through 2041. In addition, the Company had R&D credit carryforwards of approximately $38 million for federal and $15 million for California, Massachusetts and New Jersey, as well as foreign tax credits of $0.9 million available to offset federal income tax. Federal R&D credits began to expire in 2022 will expire through 2043. California R&D credits carryover indefinitely. A reconciliation of the beginning and ending amount of unrecognized tax benefit follows: Year Ended December 31, 2023 2022 2021 (in thousands) Balance at beginning of year $ 13,612 $ 14,517 $ 15,132 Additions based on tax positions related to the current year 2,456 2,522 1,631 Additions (reductions) based on tax positions related to prior years 58 (296) (550) Reductions for settlements with taxing authorities related to prior years — — (394) Reductions for lapses of statute of limitations (839) (3,131) (1,302) Balance at end of year $ 15,287 $ 13,612 $ 14,517 At December 31, 2023, the amount of unrecognized tax benefits that would benefit the Company’s effective tax rate, if recognized, was $15.3 million. At this time, the Company estimates that the liability for unrecognized tax benefits will decrease by an estimated $1.6 million in the next twelve months as statutes of limitations expire and a transfer pricing agreement is concluded with India. The Company recognizes potential interest and penalties related to unrecognized tax benefits in income tax expense. For the years ended December 31, 2023 and 2022, income tax expense (benefit) included $(0.4) million and $0.3 million, respectively, of potential interest and penalties related to unrecognized tax benefits. The Company had accrued interest and penalties of $1.6 million and $2.0 million as of December 31, 2023 and 2022, respectively, which are included in other liabilities in the consolidated balance sheets. The Company files a consolidated federal income tax return and separate tax returns with various states. Additionally, foreign subsidiaries of the Company file tax returns in foreign jurisdictions. The Company’s tax returns for the 2019-2022 calendar years remain open to examination by the IRS in their entirety. With respect to state taxing jurisdictions, the Company’s tax returns for the 2018-2022 calendar years remain open to examination by various state revenue services. The Company's Indian subsidiaries are currently under examination by the India Tax Authority for the fiscal years ended March 31, 2023, 2022, 2021, 2020, 2019, 2017, 2012, 2011 and 2010. Based on the outcome of examinations of the Company's subsidiaries or the result of the expiration of statutes of limitations, it is reasonably possible that the related unrecognized tax benefits could change from those recorded in the consolidated balance sheets. It is possible that one or more of these audits may be finalized within the next twelve months. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | Net Income (Loss) Per Share The following table provides the numerators and denominators used in computing basic and diluted net income (loss) attributable to Envestnet, Inc., per share: Year Ended December 31, 2023 2022 2021 (in thousands, except share and per share amounts) Net income (loss) attributable to Envestnet, Inc. - Basic $ (238,724) $ (80,939) $ 13,296 Interest and gain on settlement of Convertible Notes due 2025, net of interest and tax — (9,524) — Net income (loss) attributable to Envestnet, Inc. - Diluted $ (238,724) $ (90,463) $ 13,296 Weighted-average common shares outstanding: Basic 54,457,365 55,199,482 54,470,975 Effect of dilutive shares: Convertible Notes — 1,642,643 — Non-vested RSUs and PSUs — — 633,384 Options to purchase common stock — — 206,022 Warrants — — 73,715 Diluted 54,457,365 56,842,125 55,384,096 Net income (loss) attributable to Envestnet, Inc., per share: Basic $ (4.38) $ (1.47) $ 0.24 Diluted $ (4.38) $ (1.59) $ 0.24 Securities that were anti-dilutive and therefore excluded from the computation of diluted net income (loss) per share were as follows: December 31, 2023 2022 2021 Convertible Notes (1) 11,084,413 11,470,646 9,898,549 Non-vested RSU's and PSU's 1,672,311 1,941,025 — Options to purchase common stock 202,166 277,535 — Total anti-dilutive securities 12,958,890 13,689,206 9,898,549 __________________________________________________________ (1) From 2021 to 2022, this amount increased by 7,837,480 potential common shares associated with the Convertible Notes due 2027 issued in 2022, partially offset by 4,391,743 potential common shares associated with the Convertible Notes due 2023 and 1,873,640 potential common shares associated with the Convertible Notes due 2025 repurchased in 2022. From 2022 to 2023, this amount decreased by 386,233 potential common shares associated with the Convertible Notes due 2023 that matured on June 1, 2023. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Envestnet is organized around two business segments based on clients served and products provided to meet those needs. The Company's business segments are: • Envestnet Wealth Solutions – a leading provider of comprehensive and unified wealth management software, services and solutions to empower financial advisors and institutions to enable them to deliver holistic advice to their clients. • Envestnet Data & Analytics – a leading provider of financial data aggregation, analytics and digital experiences to meet the needs of financial institutions, enterprise FinTech firms and market investment research firms worldwide. We also incur expenses not directly attributable to the segments listed above. These nonsegment operating expenses primarily consist of employee compensation for certain corporate officers, certain types of professional service expenses, insurance, acquisition related transaction costs, certain restructuring charges and other non-recurring and/or non-operationally related expenses. See “Note 18—Revenue and Direct Expense” for detail of revenue by segment. The following table presents a reconciliation from income (loss) from operations by segment to consolidated net income (loss) attributable to Envestnet, Inc.: Year Ended December 31, 2023 2022 2021 (in thousands) Envestnet Wealth Solutions $ 108,753 $ 57,323 $ 129,287 Envestnet Data & Analytics (216,542) (22,221) (2,603) Nonsegment operating expenses (96,692) (101,126) (86,143) Income (loss) from operations (204,481) (66,024) 40,541 Total other income (expense), net (28,516) (12,395) (20,180) Income (loss) before income tax provision (232,997) (78,419) 20,361 Income tax provision 12,777 7,061 7,667 Net income (loss) (245,774) (85,480) 12,694 Add: Net loss attributable to non-controlling interest 7,050 4,541 602 Net income (loss) attributable to Envestnet, Inc. $ (238,724) $ (80,939) $ 13,296 The following table presents a summary of total assets, depreciation and amortization and capital expenditures, including both purchases of property and equipment and capitalization of internally developed software, by segment: Total Assets Depreciation and amortization Capital expenditures As of December 31, For the year ended December 31, For the year ended December 31, 2023 2022 2023 2022 2021 2023 2022 2021 (in thousands) Envestnet Wealth Solutions $ 1,562,600 $ 1,560,923 $ 103,301 $ 98,600 $ 91,024 $ 95,777 $ 82,442 $ 66,709 Envestnet Data & Analytics 314,652 551,242 27,003 27,228 26,743 17,525 22,883 22,192 Total $ 1,877,252 $ 2,112,165 $ 130,304 $ 125,828 $ 117,767 $ 113,302 $ 105,325 $ 88,901 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Purchase Obligations and Indemnifications The Company includes various types of indemnification and guarantee clauses in certain arrangements. These indemnifications and guarantees may include, but are not limited to, infringement claims related to intellectual property, direct or consequential damages and guarantees to certain service providers and service level requirements with certain customers. The type and amount of any potential indemnification or guarantee varies substantially based on the nature of each arrangement. The Company has experienced no previous claims and cannot determine the maximum amount of potential future payments, if any, related to such indemnification and guarantee provisions. The Company believes that it is unlikely it will have to make material payments under these arrangements and therefore has not recorded a contingent liability associated with these arrangements in the consolidated balance sheets. The Company enters into unconditional purchase obligations arrangements for certain of its services that it receives in the normal course of business. As of December 31, 2023, the Company estimated future minimum unconditional purchase obligations of approximately $150 million. In connection with the Redi2 acquisition, the Company has agreed to pay up to $20.0 million in performance bonuses based upon the achievement of certain performance targets. As of December 31, 2023, the liabilities associated with these performance bonuses were immaterial. We have also committed $8.8 million in future funding to certain equity method investees. Legal Proceedings The Company and its subsidiary, Yodlee, have been named as defendants in a lawsuit filed on July 17, 2019, by FinancialApps in the United States District Court for the District of Delaware. The case caption is FinancialApps, LLC v. Envestnet Inc., et al., No. 19-cv-1337 (D. Del.). FinancialApps alleges that, after entering into a 2017 services agreement with Yodlee, Envestnet and Yodlee breached the agreement and misappropriated proprietary information to develop competing credit risk assessment software. The complaint includes claims for, among other things, misappropriation of trade secrets, fraud, tortious interference with prospective business opportunities, unfair competition, copyright infringement and breach of contract. FinancialApps is seeking significant monetary damages and various equitable and injunctive relief. On September 17, 2019, the Company and Yodlee filed a motion to dismiss certain of the claims in the complaint filed by FinancialApps, including the copyright infringement, unfair competition and fraud claims. On August 25, 2020, the District Court granted in part and denied in part the Company and Yodlee’s motion. Specifically, the Company and Yodlee prevailed on FinancialApps’ counts alleging copyright infringement and violations of the Illinois Deceptive Trade Practices Act. And while the Court was receptive to Envestnet and Yodlee’s argument that several of FinancialApps’ other counts are based on allegations that amount to copyright infringement—and therefore should fail due to copyright preemption—the Court found that FinancialApps had alleged enough conduct distinct from copyright infringement to survive dismissal at this early stage. On October 30, 2019, the Company and Yodlee filed counterclaims against FinancialApps. Yodlee alleges that FinancialApps fraudulently induced it to enter into contracts with FinancialApps, then breached those contracts. FinancialApps has filed a motion to dismiss Yodlee’s counterclaims. On September 15, 2020, the District Court denied FinancialApps’ motion on all counts except for the breach-of-contract claim which was dismissed on a pleading technicality without prejudice. On that count, the Court granted Yodlee leave to amend its counterclaim, cure the technical deficiency, and reassert its claim. Yodlee and Envestnet filed amended counterclaims on September 30, 2020. The amended counterclaims (1) cure that technical deficiency and reassert Yodlee’s contract counterclaim; and (2) broaden the defamation counterclaims arising out of various defamatory statements FinancialApps disseminated in the trade press after filing the lawsuit. On January 14, 2021, the Court ordered that (i) FinancialApps' claims against Yodlee—as well as Yodlee’s counterclaims against FinancialApps—must be tried before the judge instead of a jury pursuant to a jury waiver provision in the parties’ agreement; and (ii) FinancialApps' claims against Envestnet (and Envestnet’s counterclaim) must be heard by a jury. The Court has scheduled the Envestnet jury trial to take place before the Yodlee bench trial. Fact discovery closed on April 23, 2021, other than a few outstanding matters, and expert discovery concluded on September 30, 2022. The parties’ respective summary judgment and motions to exclude the presentation of expert testimony (a “Daubert Motion”) are fully briefed and are awaiting final ruling. On July 25, 2023, the Magistrate Judge issued a report and recommendation that the Court grant FinancialApps’ summary judgment motion on Envestnet’s defamation counterclaim. The Magistrate Judge did not make a ruling as to Yodlee’s defamation counterclaim. On July 28, 2023, the Magistrate Judge denied Envestnet and Yodlee's Daubert motion to exclude FinancialApps' technical expert, Isaac Pflaum. On July 31, 2023, the Magistrate Judge issued a report and recommendation that the Court grant in part and deny in part Envestnet's summary judgment motion. The Magistrate Judge recommended that the motion be denied as to FinancialApps' vicarious liability theory and direct liability theory but recommended that the motion be granted with respect to the unjust enrichment count. The reports and recommendations are not final rulings, however, and the Company has filed objections against their adoption by the District Court. Those objections are fully briefed and pending before the District Court. On August 14, 2023, the Magistrate Judge granted-in-part and denied-in-part FinancialApps' Daubert motion to exclude Envestnet and Yodlee's technical expert. On September 13, 2023, the Magistrate Judge granted-in-part and denied-in-part Envestnet and Yodlee's Daubert motion to exclude FinancialApps' damages expert. On January 18, 2024, FinancialApps filed a motion seeking sanctions for purported spoliation of evidence against Yodlee and Envestnet. Yodlee and Envestnet filed a brief opposing the motion on February 22, 2024. The Company believes FinancialApps' allegations are without merit and will continue to defend the claims against it and litigate the counterclaims vigorously. The Company and Yodlee were named as defendants in a putative class action lawsuit filed on August 25, 2020, by Plaintiff Deborah Wesch in the United States District Court for the Northern District of California. On October 21, 2020, an amended class action complaint was filed by Plaintiff Wesch and nine additional named plaintiffs. The case caption currently is Clark, et al., v. Yodlee, Inc. Case No. 3:20-cv-5991-SK (formerly entitled Deborah Wesch, et al., v. Yodlee, Inc., et al., Case No. 3:20-cv-05991-SK). Plaintiffs alleged that Yodlee unlawfully collected their financial transaction data when plaintiffs linked their bank accounts to a mobile application that uses Yodlee’s Instant Account Verification API, and plaintiffs further allege that Yodlee unlawfully sold the transaction data to third parties. The complaint alleged violations of certain California statutes and common law, including the Unfair Competition Law, and federal statutes, including the Stored Communications Act. Plaintiffs are seeking monetary damages and equitable and injunctive relief on behalf of themselves and a putative nationwide class and California subclass of persons who provided their log-in credentials to a Yodlee-powered app in an allegedly similar manner from 2014 to the present. On November 4, 2020, the Company and Yodlee filed separate motions to dismiss all of the claims in the complaint. On February 16, 2021, the district court granted in part and denied in part Yodlee’s motion to dismiss the amended complaint and granted the plaintiffs leave to further amend. The court reserved ruling on the Company’s motion to dismiss and granted limited jurisdictional discovery to the plaintiffs. On March 15, 2021, Plaintiffs filed a second amended class action complaint re-alleging, among others, the claims the district court had dismissed. The second amended complaint did not allege any claims against the Company or Yodlee that were not previously alleged in first amended complaint. On May 5, 2021, the Company filed a motion to dismiss all claims asserted against it in the second amended complaint, and Yodlee filed a motion to dismiss most claims asserted against it in the second amended complaint. On July 19, 2021, the court granted in part Yodlee’s motion, resulting in the dismissal of all federal law claims and two of the state-law claims. On August 5, 2021, the Court granted the Company's motion to dismiss, and dismissed the Company from the lawsuit. On October 8, 2021, Yodlee filed an early motion for summary judgment. On August 12, 2022, Plaintiffs moved for leave to file a third amended complaint, which Yodlee opposed. On September 29, 2022, the Court denied Plaintiffs’ motion to amend the complaint. On December 13, 2022, the Court granted in part and denied in part Yodlee’s early motion for summary judgment, narrowing the scope of issues that remain to be resolved. On January 30, 2023, the Court granted Yodlee’s motion for reconsideration and dismissed one additional claim. Plaintiffs filed an amended complaint on September 19, 2023, which Yodlee answered on October 3, 2023. Yodlee believes the allegations are without merit and will continue to vigorously defend the remaining claims against it. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net Income (Loss) | $ (238,724) | $ (80,939) | $ 13,296 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Segment Reporting | Segment Reporting |
Principles of Consolidation | Principles of Consolidation —The consolidated financial statements include the accounts of Envestnet and its subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. |
Foreign Currency | Foreign Currency —Accounts for the Envestnet Wealth Solutions segment that are denominated in a non-U.S. currency have been remeasured using the U.S. dollar as the functional currency. Certain accounts within the Envestnet Data & Analytics segment are recorded and measured in foreign currencies. The assets and liabilities for those subsidiaries with a functional currency other than the U.S. dollar are translated at exchange rates in effect at the balance sheet date, and revenue and expenses are translated at average exchange rates. Differences arising from these foreign currency translations are recorded in the consolidated balance sheets as accumulated other comprehensive income (loss) within stockholders' equity. The Company is also subject to gains and losses from foreign currency denominated transactions and the remeasurement of foreign currency denominated balance sheet accounts, both of which are included in other income (expense), net in the consolidated statements of operations. |
Management Estimates | Management Estimates —Management has made certain estimates and assumptions relating to the reporting of assets, liabilities, revenue and expenses and the disclosure of contingent assets and liabilities to prepare these consolidated financial statements in conformity with GAAP. Areas requiring the use of management estimates relate to estimating uncollectible receivables, revenue recognition, valuations and assumptions used for impairment testing of goodwill, intangible and other long-lived assets, right-of-use assets, performance shares issued, contingent consideration, realization of deferred tax assets, uncertain tax positions, sales tax liabilities, operating lease liabilities, commitments and contingencies and assumptions used to allocate purchase prices in business combinations. Actual results could differ materially from these estimates under different assumptions or conditions. |
Reclassification | Reclassifications —Certain amounts in the consolidated balance sheets as of December 31, 2023 and December 31, 2022 and the consolidated statements of cash flows for years ended December 31, 2023, 2022 and 2021 have been reclassified to conform to the current period presentation. These reclassifications did not change the previously reported total assets, total liabilities and equity, or net change in cash and cash equivalents and did not affect the consolidated statements of operations, consolidated statements of comprehensive income (loss) or consolidated statements of stockholders' equity. |
Revenue Recognition | Revenue Recognition The Company accounts for its revenue arrangements in accordance with ASC 606. The Company derives revenue from asset-based and subscription-based services and professional services and other sources. Revenue is recognized when control of these services is transferred to the Company's customers, in an amount that reflects the consideration that we expect to be entitled to in exchange for those services. All revenue recognized in the consolidated statements of operations is considered to be revenue from contracts with customers. Sales and usage-based taxes are excluded from revenue. The majority of the Company's revenue is recognized when services are provided. Asset-Based Recurring Revenue —Asset-based recurring revenue primarily consist of fees for providing customers continuous access to platform services through the Company’s uniquely customized platforms. These platform services include investment manager research, portfolio diagnostics, proposal generation, investment model management, rebalancing and trading, portfolio performance reporting and monitoring solutions, billing and back office and middle-office operations and administration and are made available to customers throughout the contractual term from the date the customized platform is launched. The asset-based fees the Company earns are generally based upon variable percentages of assets managed or administered on its platforms. The fee percentage varies based on the level and type of services the Company provides to its customers, as well as the values of existing customer accounts. The values of the customer accounts are affected by inflows or outflows of customer funds and market fluctuations. The platform services are substantially the same over each quarter and performed in a similar manner over the contract period, and are considered stand-ready promises. The platform services that are delivered to the customer over the quarter are considered distinct, as the customer benefits distinctly from each increment of the Company's services and each quarter is separately identified in the contract, and are considered to be a single performance obligation. The pricing generally resets each quarter and the pricing structure is consistent throughout the term of the contract. The variable fees are generally calculated and billed quarterly in advance based on preceding quarter-end values and the variable amounts earned from the platform services relate specifically to the benefits transferred to the customer during that month or quarter. Accordingly, revenue is allocated to the specific quarter in which services are performed. The asset-based contracts generally contain one performance obligation and revenue is recognized on a ratable basis over the quarter beginning on the date that the platform services are made available to the customer as the customer simultaneously consumes and receives the benefits of the services. All asset-based fees are recognized in the Envestnet Wealth Solutions segment. For certain services provided by third parties, the Company evaluates whether it is the principal (revenue reported on a gross basis) or agent (revenue reported on a net basis). Generally, the Company reports customer fees including charges for third party service providers where the Company has a direct contract with such third party service providers on a gross basis, whereas the amounts billed to its customers are recorded as revenue, and amounts paid to third party service providers are recorded as direct expense. The Company is the principal in the transaction because it controls the services before they are transferred to its customers. Control is evidenced by the Company being primarily responsible to its customers and having discretion in establishing pricing. Subscription-Based Recurring Revenue —Subscription-based recurring revenue primarily consist of fees for providing customers continuous access to the Company’s platform for wealth management and financial wellness. The subscription-based fees generally include fixed fees and or usage-based fees. Generally, the subscription services are substantially the same over each quarter and performed in a similar manner over the contract period, and are considered stand-ready promises. Quarterly subscription services are considered distinct as the customer can benefit from each increment of services on its own and each quarter is separately identified in the contract, and services are considered to be a single performance obligation. Certain subscription-based contracts include fixed and variable consideration. The amount of variable consideration that is included in the transaction price may be subject to constraint and included in the subscription-based recurring revenue only to the extent that is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. The Company utilizes the expected value method to estimate variable consideration based on available historical, current, and forecasted information. The usage-based pricing generally resets each quarter and the pricing structure is generally consistent throughout the term of the contract. The fixed fees are generally calculated and billed quarterly in advance. The usage-based fees are generally calculated and are billed either monthly or quarterly based on the actual usage and relate specifically to the benefits transferred to the customer during that quarter. Accordingly, revenue is allocated to the specific quarter in which services are performed. Fixed fees are generally recognized on a ratable basis over the quarter beginning when the subscription services are made available to the customer, as the customer simultaneously receives and consumes the benefits of the subscription services. Usage-based revenue is recognized on a monthly basis as the customer receives and consumes the benefit as the Company provides the services. Subscription-based fees are recognized in both the Envestnet Wealth Solutions and Envestnet Data & Analytics segments. Professional Services and Other Revenue —The Company earns professional services fees by providing contractual customized services and platform software development as well as initial implementation fees. Professional services contracts generally have one performance obligation, fixed prices, and generally specify the deliverables in the contract. Certain professional services contracts are billed on a time and materials basis and revenue is recognized over time as the services are performed. For contracts billed on a fixed price basis, revenue is recognized over time based on the proportion of services performed. Initial implementation fees are fixed and are generally recognized ratably over the contract term. Other revenue is not significant and primarily includes revenue related to the Advisor Summit which is recognized when the event is held. Professional services and other revenue is recognized in both the Envestnet Wealth Solutions and Envestnet Data & Analytics segments. Arrangements with Multiple Performance Obligations —Certain of the Company’s contracts with customers contain multiple performance obligations, such as a platform services performance obligation and a professional services performance obligation. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. Standalone selling prices of services are estimated based on observable transactions when these services are sold on a standalone basis or based on expected cost plus margin. Remaining Performance Obligations —Remaining performance obligations represent the transaction price allocated to unsatisfied or partially satisfied performance obligations. The disclosure includes estimates of variable consideration. The Company applies the practical expedients and exemption not to disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less; (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed; and (iii) contracts for which the variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct service that forms part of a single performance obligation. Contract Balances —The Company records contract liabilities (deferred revenue) when cash payments are received in advance of its performance. The term between invoicing date and when payment is due is generally not significant. For the majority of its arrangements, the Company requires advance quarterly payments before the services are delivered to the customer. Deferred Revenue —Deferred revenue primarily consists of implementation fees, professional services and subscription fee payments received in advance from customers. Deferred Sales Incentive Compensation —Sales incentive compensation earned by the Company’s sales force is considered an incremental and recoverable cost to acquire a contract with a customer. Sales incentive compensation for initial contracts is deferred and amortized on a straight-line basis over the period of benefit. The Company determined the period of benefit by taking into consideration its customer contracts, life of the technology and other factors. Sales incentive compensation for renewal contracts are deferred and amortized on a straight-line basis over the related contractual renewal period. Deferred sales incentive compensation is included in other assets in the consolidated balance sheets and amortization expense is included in employee compensation expenses in the consolidated statements of operations. The Company has applied the practical expedient to recognize the incremental costs of obtaining contracts as an expense when incurred if the amortization period would have been one year or less. These costs are included in employee compensation expense in the consolidated statements of operations. Direct Expense —Direct expense primarily includes expenses related to third party investment management and clearing, custody and brokerage services. Generally, these expenses are calculated based upon a contractual percentage of the market value of assets held in customer accounts measured as of the end of each quarter and are recognized ratably throughout the quarter based on the number of days in the quarter. Also included in direct expense are vendor specific expenses related to the direct support of revenue associated with the Envestnet Data & Analytics products. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Investments | Investments —The Company has investments in private companies for which it has significant influence that are recorded using the equity method of accounting. The Company uses the equity method of accounting because of its less than 50% ownership and/or lack of control in these companies. These investments are included in other assets in the consolidated balance sheets. The Company records the portion of its earnings or losses in these privately held companies’ net income or loss on a one quarter lag from the actual results of operations as a component of other income (expense), net in the consolidated statements of operations. The Company reviews all investments on a regular basis to evaluate the carrying amount and economic viability. This evaluation process is based on information that the Company requests directly from these investees and includes, but is not limited to, the review of the investee’s cash position, financing needs, earnings/revenue outlook, operational performance, management/ownership changes and competition. As this information is not subject to the same disclosure regulations as U.S. publicly traded companies, the basis for these evaluations is subject to the timing and accuracy of the data received from these investees. |
Property and Equipment | Property and Equipment —Property and equipment are stated at cost less accumulated depreciation and amortization. Depreciation of property and equipment, outside of leasehold improvements and land, is computed using the straight-line method based on estimated useful lives of the depreciable assets. Leasehold improvements are amortized on a straight-line basis over their estimated economic useful lives or the remaining lease term, whichever is shorter. Improvements are capitalized, while repairs and maintenance costs are charged to operations as incurred. Assets are reviewed for recoverability whenever events or circumstances indicate the carrying value may not be recoverable. There were immaterial impairments of property and equipment for the year ended December 31, 2023 and 2021. There were $5.1 million of impairments of property and equipment for the year ended December 31, 2022. |
Internally Developed Software for Internal Use | Internally Developed Software for Internal Use |
Goodwill | Goodwill —Goodwill consists of the excess of the purchase price over the fair value of identifiable net assets of businesses acquired. Goodwill is reviewed for impairment each year using a qualitative or quantitative process that is performed at least annually or whenever events or circumstances indicate a likely reduction in the fair value of a reporting unit below its carrying amount. The Company has concluded that it has two reporting units. The Company performs the annual impairment analysis on October 31 in order to provide management time to complete the analysis prior to year-end. Prior to performing the quantitative evaluation, an assessment of qualitative factors may be performed to determine whether it is more likely than not that the fair value of a reporting unit exceeds the carrying value. If it is determined that it is unlikely that the carrying value exceeds the fair value, the Company is not required to complete the quantitative goodwill impairment evaluation. If it is determined that the carrying value may exceed fair value when considering qualitative factors, a quantitative goodwill impairment evaluation is performed. When performing the quantitative evaluation, if the carrying value of the reporting unit exceeds its fair value, an impairment loss equal to the difference will be recorded. No goodwill impairment charges were recorded for the years ended December 31, 2022 and 2021. See "Note 10—Goodwill" for a discussion of the impairment analysis for the year ended December 31, 2023. |
Intangible Assets | Intangible Assets |
Leases | Leases —The Company accounts for its leases in accordance with ASC 842 and has elected the available package of practical expedients as well as elected to apply the short-term lease exemption to all of its classes of underlying assets. At inception, the Company determines if an arrangement is a lease. Operating leases are included in ROU assets, operating lease liabilities and operating lease liabilities, net of current portion in the Company's consolidated balance sheets. ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the remaining lease term. The operating lease ROU asset also includes prepaid payments and excludes lease incentives. As none of the Company's leases provide an implicit rate, the Company uses an estimated incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease and non-lease components. The Company has elected the practical expedient to account for non-lease components as part of the lease component for all asset classes. The majority of the Company's lease agreements are real estate leases. |
Fair Value Measurements | Fair Value Measurements —The Company accounts for its fair value measurements in accordance with ASC 825, which provides companies the option to report selected financial assets and liabilities at fair value and also requires entities to display the fair value of the selected assets and liabilities on the face of the balance sheets. The Company has not elected the ASC 825-10 option to report selected financial assets and liabilities at fair value. ASC 825-10 also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect of the Company’s choice to use fair value on its earnings. Financial assets and liabilities recorded at fair value in the consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels: Level I: Inputs based on quoted market prices in active markets for identical assets or liabilities at the measurement date. Level II: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or inputs that are observable and can be corroborated by observable market data. Level III: Inputs reflect management’s best estimates and assumptions of what market participants would use in pricing the asset or liability at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments. |
Income Taxes | Income Taxes —The Company uses the asset and liability method to account for income taxes. 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 net operating loss 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company records a valuation allowance to reduce deferred tax assets to an amount that is more likely than not to be realized. |
Business Combinations | Business Combinations |
Stock-Based Compensation | Stock-Based Compensation —Compensation cost relating to stock-based awards made to employees and directors is recognized in the consolidated financial statements using the Black-Scholes option-pricing model in the case of stock option awards, and intrinsic value in the case of restricted stock awards. The Company measures the cost of such awards based on the estimated fair value of the award measured at the grant date and recognizes the expense on a straight-line basis over the requisite service period, which is the vesting period. Determining the fair value of stock options requires the Company to make several estimates, including the volatility of its stock price, the expected life of the option, forfeiture rate, dividend yield and interest rates. The Company estimates the expected life of its options using historical internal forfeiture data. The Company estimates stock-price volatility using historical third-party quotes of the Company's common stock. The Company utilizes a risk-free interest rate, which is based on the yield of U.S. zero coupon securities with a maturity equal to the expected life of the options. The Company has not and does not expect to pay dividends on its common shares. The Company is required to estimate expected forfeitures of stock-based awards at the grant date and recognize compensation cost only for those awards expected to vest. The forfeiture assumption is ultimately adjusted to the actual forfeiture rate. Therefore, changes in the forfeiture assumptions may impact the total amount of expense ultimately recognized over the vesting period. Estimated forfeitures will be reassessed in subsequent periods and may change based on new facts and circumstances. |
Convertible Notes | Convertible Notes —The Convertible Notes are accounted for in accordance with ASC 470. The Company has determined that the embedded conversion options in the Convertible Notes are not required to be separately accounted for as a derivative under GAAP. Upon adoption of ASU 2020-06, the Company accounts for the Convertible Notes as a single liability measured at amortized cost. |
Capped Call Transactions | Capped Call Transactions —In November 2022, the Company entered into the Capped Call Transactions with the Capped Call Counterparties. The Capped Call Transactions initially cover the number of shares of the Company's common stock underlying the Convertible Notes due 2027, subject to customary anti-dilution adjustments. The Capped Call Transactions are net purchased call options on the Company's common stock. The Capped Call Transactions are separate transactions entered into by the Company with each of the Capped Call Counterparties, are not part of the terms of the Convertible Notes due 2027, and do not affect any holder’s rights under the Convertible Notes due 2027. Holders of the Convertible Notes due 2027 do not have any rights with respect to the Capped Call Transactions. As the Capped Call Transactions are legally detachable and separately exercisable from the Convertible Notes due 2027, they were evaluated as freestanding instruments under FASB Topic 480 - Distinguishing Liabilities from Equity. The Company concluded that the Capped Call Transactions meet the scope exceptions for derivative instruments under FASB Topic 815 - Derivatives and Hedging. As such, the Capped Call Transactions meet the criteria for classification in equity and are included as a reduction to additional paid-in capital. |
Non-controlling Interest | Non-controlling Interest —In March 2018, the Company initially acquired a 43% fully diluted interest in a private company for cash consideration of $1.3 million. In connection with the acquisition, the Company was granted the ability to appoint two members to the private company's board of directors. The Company’s two appointed members hold the majority of the private company’s board voting rights until December 31, 2024. As a result, the Company uses the consolidation method of accounting for this investment. The private company was formed to enable financial advisors to provide insurance and income protection products to their clients. |
Net Income (Loss) Per Share | Net Income (Loss) Per Share —Basic net income (loss) per common share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock outstanding for the period. For the calculation of diluted net income (loss) per share, the basic weighted average number of shares is increased by the dilutive effect of the Company's potentially dilutive securities, including stock options, restricted stock awards, restricted stock units, common warrants and convertible notes. The Company accounts for the effect of convertible notes on diluted net income (loss) per share using the if-converted method. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities.” This update amends ASC 805 Business Combinations to add contract assets and contract liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure contract assets and contract liabilities in accordance with ASC 606. This standard is effective for financial statements issued by public companies for annual and interim periods beginning after December 15, 2022. Early adoption of the standard is permitted. The amendment is to be applied prospectively to business combinations occurring on or after the effective date of the amendment. The Company has early adopted this standard as of January 1, 2022. Adoption of ASU 2021-08 did not have a material impact on the Company's consolidated financial statements. Recent Accounting Pronouncements Not Yet Adopted In March 2023, the FASB issued ASU 2023-01, “Leases (Topic 842): Common Control Arrangements.” This update amends ASC 842 and the accounting for leasehold improvements associated with common control leases. This standard is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption of the standard is permitted. Adoption of ASU 2023-01 will not have a material impact on the Company's consolidated financial statements. In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures." This update amends the requirements for segment disclosures. This standard is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption of the standard is permitted. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Cash and Cash Equivalents | The following table reconciles cash, cash equivalents and restricted cash from the consolidated balance sheets to amounts reported in the consolidated statements of cash flows: December 31, 2023 2022 2021 (in thousands) Cash and cash equivalents $ 91,378 $ 162,173 $ 429,279 Restricted cash included in prepaid expenses and other current assets — — 149 Total cash, cash equivalents and restricted cash $ 91,378 $ 162,173 $ 429,428 |
Schedule of Restricted Cash and Cash Equivalents | The following table reconciles cash, cash equivalents and restricted cash from the consolidated balance sheets to amounts reported in the consolidated statements of cash flows: December 31, 2023 2022 2021 (in thousands) Cash and cash equivalents $ 91,378 $ 162,173 $ 429,279 Restricted cash included in prepaid expenses and other current assets — — 149 Total cash, cash equivalents and restricted cash $ 91,378 $ 162,173 $ 429,428 |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of the Estimated Fair Values of the Assets Acquired and Liabilities Assumed | Tangible assets acquired, net of cash received $ 5,310 Identifiable intangible assets 9,500 Goodwill 18,526 Total assets acquired 33,336 Total liabilities assumed (542) Total net assets acquired, net of cash received $ 32,794 The following table summarizes the fair values of the assets acquired as of the date of acquisition (in thousands): Tangible assets acquired, net of cash received $ 104 Identifiable intangible assets 3,000 Goodwill 11,396 Total net assets acquired, net of cash received $ 14,500 The following table summarizes the fair values of the assets acquired as of the date of acquisition (in thousands): Tangible assets acquired, net of cash received $ 510 Identifiable intangible assets 4,000 Goodwill 16,217 Total net assets acquired, net of cash received $ 20,727 The following table summarizes the fair values of the assets acquired as of the date of acquisition (in thousands): Current assets, net of cash received $ 1,985 Other assets 3,321 Identifiable intangible assets 26,500 Goodwill 46,467 Total assets acquired 78,273 Accounts payable and accrued expenses (2,428) Operating lease liabilities (2,201) Deferred revenue (4,771) Total liabilities assumed (9,400) Total net assets acquired, net of cash received $ 68,873 |
Schedule of Intangible Assets Acquired, Estimated Useful Lives and Amortization Method | A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Proprietary technology $ 6,900 6 Straight-line Customer list 2,600 14 Accelerated Total intangible assets acquired $ 9,500 A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Proprietary technology $ 3,000 5 Straight-line A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Proprietary technology $ 4,000 5 Straight-line A summary of intangible assets acquired is as follows: Gross Carrying Amount Estimated Useful Life Amortization Method (in thousands) (in years) Customer lists $ 14,000 14-16 years Accelerated Proprietary technologies 9,500 6 years Straight-line Trade names 3,000 6-7 years Straight-line Total intangible assets acquired $ 26,500 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following: December 31, 2023 2022 (in thousands) Prepaid technology $ 14,630 $ 16,649 Prepaid data servers 7,991 6,059 Income tax prepayments and receivables 9,625 2,515 Non-income tax receivables 4,041 5,488 Prepaid insurance 2,785 2,881 Other 12,400 13,830 Total prepaid expenses and other current assets $ 51,472 $ 47,422 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Property and equipment, net consisted of the following: December 31, Depreciable Life 2023 2022 (in thousands) Computer equipment and software 3 years $ 61,852 $ 67,230 Leasehold improvements Lesser of estimated useful life or life of lease 38,296 36,158 Office furniture and fixtures 3-7 years 11,333 10,796 Office equipment and other 3-5 years 15,114 11,563 Building and building improvements 7-39 years 2,729 2,729 Land Not applicable 940 940 Total property and equipment 130,264 129,416 Less: accumulated depreciation (82,041) (80,935) Total property and equipment, net $ 48,223 $ 48,481 |
Schedule of Cost Amount and Related Accumulated Depreciation Written Off by Category | The following table presents the cost amounts and related accumulated depreciation written off by category: Year Ended December 31, 2023 Year Ended December 31, 2022 Accumulated Accumulated Cost Depreciation Cost Depreciation (in thousands) Computer equipment and software $ 12,269 $ (12,267) $ 15,887 $ (14,947) Leasehold improvements 934 (860) 2,442 (1,209) Office furniture and fixtures 721 (551) 660 (418) Office equipment and other 149 (57) 11,467 (8,785) Total property and equipment retirements $ 14,073 $ (13,735) $ 30,456 $ (25,359) |
Internally Developed Software_2
Internally Developed Software, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Capitalized Computer Software, Net [Abstract] | |
Schedule of Components of Internally Developed Software, Net | Internally developed software, net consisted of the following: December 31, Estimated Useful Life 2023 2022 (in thousands) Internally developed software 5 years $ 405,078 $ 313,200 Less: accumulated amortization (180,365) (128,642) Internally developed software, net $ 224,713 $ 184,558 |
Geographical Information (Table
Geographical Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segments, Geographical Areas [Abstract] | |
Schedule of Property, Plant, and Equipment, Net by Geographic Area | The following table sets forth certain long-lived assets including property and equipment, net and internally developed software, net by geographic area: December 31, 2023 2022 (in thousands) United States $ 270,381 $ 231,855 India 2,555 1,093 Other — 91 Total long-lived assets, net $ 272,936 $ 233,039 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Components of Intangible Assets, Net | Intangible assets, net consisted of the following: December 31, 2023 December 31, 2022 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount (in thousands) Customer lists $ 604,080 $ (327,042) $ 277,038 $ 604,080 $ (285,288) $ 318,792 Proprietary technologies 93,058 (37,052) 56,006 113,224 (59,401) 53,823 Trade names 15,700 (10,676) 5,024 15,700 (8,320) 7,380 Total intangible assets $ 712,838 $ (374,770) $ 338,068 $ 733,004 $ (353,009) $ 379,995 |
Schedule of Future Amortization Expense of the Intangible Assets | The estimated future amortization expense of the Company's intangible assets as of December 31, 2023 was as follows (in thousands): 2024 $ 57,368 2025 53,973 2026 46,448 2027 37,672 2028 30,296 Thereafter 112,311 Total $ 338,068 |
Depreciation and Amortization_2
Depreciation and Amortization Expense (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Depreciation and Amortization Expense | Depreciation and amortization expense consisted of the following: Year Ended December 31, 2023 2022 2021 (in thousands) Intangible asset amortization $ 62,927 $ 71,901 $ 68,587 Internally developed software amortization 52,422 36,959 28,603 Property and equipment depreciation 14,955 16,968 20,577 Total depreciation and amortization $ 130,304 $ 125,828 $ 117,767 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in the Carrying Amount of Goodwill by Segment | Changes in the carrying amount of goodwill by reportable segment were as follows: Envestnet Envestnet Total (in thousands) Balance as of December 31, 2021 $ 636,246 $ 288,908 $ 925,154 Goodwill recognized from acquisitions 74,080 — 74,080 Foreign currency translation — (820) (820) Balance as of December 31, 2022 710,326 288,088 998,414 Goodwill impairment — (191,818) (191,818) Foreign currency translation — (33) (33) Balance as of December 31, 2023 $ 710,326 $ 96,237 $ 806,563 Goodwill Impairment |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments | Summarized combined financial information for these investments was as follows (amounts represent 100% of investee financial information, except Envestnet ’ s proportional share of losses): December 31, 2023 2022 (in thousands) Current assets $ 68,602 $ 42,059 Other assets $ 66,016 $ 50,703 Current liabilities $ 17,150 $ 17,647 Other liabilities $ 1,857 $ 9,437 Year Ended December 31, 2023 2022 2021 (in thousands) Revenue $ 71,815 $ 79,062 $ 65,085 Loss from operations $ (16,733) $ (8,896) $ (149) Net loss $ (20,235) $ (7,124) $ (134) Envestnet ’s proportional share of gains (losses) (1) $ (10,033) $ 643 $ (7,093) __________________________________________________________ (1) The years ended December 31, 2023 and 2022 include a $0.5 million and $9.5 million dilution gain on equity method investee share issuance, respectively. |
Accounts Payable, Accrued Exp_2
Accounts Payable, Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable, Accrued Expenses and Other Current Liabilities | Accounts payable, accrued expenses and other current liabilities consisted of the following: December 31, 2023 2022 (in thousands) Accrued investment manager fees $ 106,612 $ 99,851 Accrued compensation and related taxes 72,466 77,939 Accounts payable 35,738 11,271 Accrued professional services 14,289 10,762 Accrued technology 4,151 6,393 Accrued interest 2,473 3,091 Accrued treasury stock purchases — 9,289 Other accrued expenses 5,695 15,270 Total accrued expenses and other current liabilities $ 241,424 $ 233,866 |
Schedule of Restructuring and Related Costs | The following table presents a reconciliation of the beginning and ending liability balance related to these efforts, which is primarily included within accrued compensation and related taxes in the table above. Envestnet Wealth Solutions Envestnet Data & Analytics Nonsegment Total (in thousands) Balance as of December 31, 2021 $ 4,670 $ 810 $ — $ 5,480 Severance 13,237 10,745 6,135 30,117 Cash payments (5,325) (8,769) (6,135) (20,229) Balance as of December 31, 2022 12,582 2,786 — 15,368 Severance 17,232 11,813 6,354 35,399 Cash payments (20,021) (14,113) (6,354) (40,488) Balance as of December 31, 2023 $ 9,793 $ 486 $ — $ 10,279 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Obligation | The following tables set forth the carrying value and estimated fair value of the Company's debt obligations as of December 31, 2023 and 2022: December 31, 2023 Issuance Amount Unamortized Issuance Costs Carrying Value Fair Value (Level II) (in thousands) Revolving Credit Facility $ — $ — $ — $ — Convertible Notes due 2025 317,500 (2,968) 314,532 294,958 Convertible Notes due 2027 575,000 (12,920) 562,080 571,746 Total debt $ 892,500 $ (15,888) $ 876,612 $ 866,704 December 31, 2022 Issuance Amount Unamortized Issuance Costs Carrying Value Fair Value (Level II) (in thousands) Revolving Credit Facility $ — $ — $ — $ — Convertible Notes due 2023 45,000 (114) 44,886 46,058 Convertible Notes due 2025 317,500 (4,765) 312,735 293,688 Convertible Notes due 2027 575,000 (15,966) 559,034 606,119 Total debt $ 937,500 $ (20,845) $ 916,655 $ 945,865 The effective interest rate of the Convertible Notes was equal to the stated interest rate plus the amortization of the debt issuance costs and is set forth below: December 31, 2023 2022 2021 Convertible Notes due 2023 N/A 2.4 % 2.4 % Convertible Notes due 2025 1.3 % 1.3 % 1.3 % Convertible Notes due 2027 3.2 % 3.2 % N/A |
Schedule of Interest Expense | Interest expense was comprised of the following and is included in other income (expense), net in the consolidated statements of operations: Year Ended December 31, 2023 2022 2021 (in thousands) Convertible Notes interest $ 17,845 $ 10,897 $ 9,919 Amortization of debt discount and issuance costs (1) 5,655 4,678 5,745 Undrawn and other fees 1,255 1,268 1,267 Revolving Credit Facility interest 383 — — Total interest expense $ 25,138 $ 16,843 $ 16,931 __________________________________________________________ (1) For the year ended December 31, 2022, amount includes a net gain on the extinguishment of debt of $1.7 million related to the partial repurchase of Convertible Notes due 2023 and Convertible Notes due 2025. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Schedule of Companys Leases | The following table presents information for the Company's operating leases: Year Ended December 31, 2023 2022 2021 (in thousands, except weighted-averages) Total operating lease cost $ 17,549 $ 15,157 $ 18,600 Short-term lease cost $ 16,203 $ 12,445 $ 4,940 Weighted-average remaining lease term (in years) 8.5 9.2 9.8 Weighted-average discount rate 4.9 % 5.0 % 5.1 % Cash paid for amounts included in the measurement of lease liabilities $ 16,718 $ 15,748 $ 18,052 |
Schedule of Future Minimum Lease Payments | Maturities of operating lease liabilities were as follows as of December 31, 2023 (in thousands): 2024 $ 18,204 2025 15,590 2026 15,450 2027 15,582 2028 15,889 Thereafter 59,316 Total lease payments 140,031 Less: imputed interest (26,292) Total operating lease liabilities $ 113,739 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Changes in Fair Value of the Company’s Financial Assets and Liabilities Measured at Fair Value | The following tables set forth the Company’s financial assets and liabilities measured at fair value on a recurring basis, based on the three-tier fair value hierarchy as described in detail in "Note 2—Summary of Significant Accounting Policies": December 31, 2023 Fair Value Level I Level II Level III (in thousands) Assets: Money market funds $ 51,653 $ 51,653 $ — $ — Assets to fund deferred compensation liability 10,961 — — 10,961 Total assets $ 62,614 $ 51,653 $ — $ 10,961 Liabilities: Deferred compensation liability $ 8,045 $ 8,045 $ — $ — Total liabilities $ 8,045 $ 8,045 $ — $ — December 31, 2022 Fair Value Level I Level II Level III (in thousands) Assets: Money market funds $ 2,628 $ 2,628 $ — $ — Assets to fund deferred compensation liability 10,074 — — 10,074 Total assets $ 12,702 $ 2,628 $ — $ 10,074 Liabilities: Deferred compensation liability $ 8,088 $ 8,088 $ — $ — Total liabilities $ 8,088 $ 8,088 $ — $ — |
Schedule of Changes in the Fair Value of the Company's Level 3 Liability | The table below presents a reconciliation of the contingent consideration liability and assets used to fund the Company's deferred compensation liability, which are measured at fair value on a recurring basis using significant unobservable inputs (Level III): Contingent Consideration Liability Assets to Fund Deferred Compensation Liability (in thousands) Balance at December 31, 2021 $ 743 $ 11,140 Payments (743) — Contributions — 649 Fair value adjustments and fees — (1,715) Balance at December 31, 2022 — 10,074 Fair value adjustments and fees — 887 Balance at December 31, 2023 $ — $ 10,961 |
Schedule of Changes in the Fair Value of the Company's Level 3 Assets | The table below presents a reconciliation of the contingent consideration liability and assets used to fund the Company's deferred compensation liability, which are measured at fair value on a recurring basis using significant unobservable inputs (Level III): Contingent Consideration Liability Assets to Fund Deferred Compensation Liability (in thousands) Balance at December 31, 2021 $ 743 $ 11,140 Payments (743) — Contributions — 649 Fair value adjustments and fees — (1,715) Balance at December 31, 2022 — 10,074 Fair value adjustments and fees — 887 Balance at December 31, 2023 $ — $ 10,961 |
Revenue and Direct Expense (Tab
Revenue and Direct Expense (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue by Major Source | The following tables present the Company’s revenue by segment disaggregated by major source: Year Ended December 31, 2023 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated (in thousands) Revenue: Asset-based $ 745,238 $ — $ 745,238 Subscription-based 325,398 139,332 464,730 Total recurring revenue 1,070,636 139,332 1,209,968 Professional services and other revenue 24,068 11,584 35,652 Total revenue $ 1,094,704 $ 150,916 $ 1,245,620 Year Ended December 31, 2022 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated (in thousands) Revenue: Asset-based $ 738,228 $ — $ 738,228 Subscription-based 310,217 167,627 477,844 Total recurring revenue 1,048,445 167,627 1,216,072 Professional services and other revenue 16,799 6,913 23,712 Total revenue $ 1,065,244 $ 174,540 $ 1,239,784 Year Ended December 31, 2021 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated (in thousands) Revenue: Asset-based $ 709,376 $ — $ 709,376 Subscription-based 280,076 173,913 453,989 Total recurring revenue 989,452 173,913 1,163,365 Professional services and other revenue 14,190 8,962 23,152 Total revenue $ 1,003,642 $ 182,875 $ 1,186,517 |
Schedule of Disaggregation of Revenue by Geography | The following table presents the Company’s revenue disaggregated by geography, based on the billing address of the customer: Year Ended December 31, 2023 2022 2021 (in thousands) United States $ 1,223,246 $ 1,218,254 $ 1,166,251 International 22,374 21,530 20,266 Total revenue $ 1,245,620 $ 1,239,784 $ 1,186,517 |
Schedule of Costs of Revenues by Revenue Category | The following table summarizes direct expense by revenue category: Year Ended December 31, 2023 2022 2021 (in thousands) Asset-based $ 434,123 $ 430,345 $ 393,717 Subscription-based 30,814 32,577 29,445 Professional services and other 8,101 7,502 561 Total direct expense $ 473,038 $ 470,424 $ 423,723 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense under the Company's plans was as follows: Year Ended December 31, 2023 2022 2021 (in thousands) Stock-based compensation expense $ 71,031 $ 79,581 $ 67,525 Tax effect on stock-based compensation expense (18,113) (20,293) (17,219) Net effect on income (loss) $ 52,918 $ 59,288 $ 50,306 |
Schedule of Weighted Average Assumptions Used to Value Options Granted | The following assumptions were used to value options granted during the year ended December 31, 2021: Year Ended December 31, 2021 Weighted-average grant date fair value $ 31.23 Expected volatility 42.1 % Risk-free interest rate 0.4 % Expected dividend yield — % Expected term (in years) 6.5 |
Schedule of Option Activity Under the Company's Plans | The following tables summarize option activity under the Company’s plans: Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Life Aggregate Intrinsic Value (Years) (in thousands) Outstanding as of December 31, 2022 277,535 $ 40.07 Exercised (72,410) $ 25.07 Forfeited (2,959) $ 55.28 Outstanding and exercisable as of December 31, 2023 202,166 $ 45.22 1.6 $ 1,330 |
Schedule of Other Information | Year Ended December 31, 2023 2022 2021 (in thousands) Intrinsic value of options exercised $ 2,243 $ 2,650 $ 3,815 Cash received from exercises of stock options $ 1,608 $ 2,620 $ 2,090 |
Schedule of the Activity for Unvested Restricted Stock Units and Awards Granted Under the Company's Plans | The following is a summary of the activity for non-vested restricted stock units granted under the Company’s plans: RSUs PSUs Number of Shares Weighted-Average Grant Date Fair Value per Share Number of Shares Weighted-Average Grant Date Fair Value per Share Non-vested as of December 31, 2022 1,681,976 $ 72.69 259,049 $ 74.83 Granted 1,106,853 $ 61.01 40,010 $ 69.47 Vested (1,006,719) $ 72.75 (24,939) $ 107.10 Forfeited (332,857) $ 63.75 (51,062) $ 63.21 Non-vested as of December 31, 2023 1,449,253 $ 65.78 223,058 $ 72.92 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Loss Before Income Tax Benefit | Income (loss) before income tax expense (benefit) was generated in the following jurisdictions: Year Ended December 31, 2023 2022 2021 (in thousands) Domestic $ (240,904) $ (89,000) $ 9,730 Foreign 7,907 10,581 10,631 Total $ (232,997) $ (78,419) $ 20,361 |
Schedule of Components of the Income Tax Expense (Benefit) Charged to Operations | The components of the income tax expense (benefit) charged to operations are summarized as follows: Year Ended December 31, 2023 2022 2021 (in thousands) Current: Federal $ 8,774 $ 1,185 $ — State 4,894 6,964 3,488 Foreign 588 2,402 4,499 14,256 10,551 7,987 Deferred: Federal 2,138 (2,453) 4,021 State (4,399) (1,439) (3,548) Foreign 782 402 (793) (1,479) (3,490) (320) Total $ 12,777 $ 7,061 $ 7,667 |
Schedule of Net Deferred Tax Assets (Liabilities) | Deferred tax assets (liabilities), net consisted of the following: December 31, 2023 2022 (in thousands) Deferred revenue $ 8,699 $ 8,945 Prepaid expenses and accrued expenses 6,663 8,847 Right-of-use assets (17,528) (20,388) Lease liabilities 29,497 31,328 Net operating loss and tax credit carryforwards 63,866 64,590 Property and equipment and intangible assets (84,139) (94,061) Stock-based compensation expense 9,215 10,559 Investment in partnerships (4,416) 2,836 Convertible Notes 16,754 20,440 R&D expenditures 68,543 43,956 Withholding taxes (5,035) (4,841) Other (865) 196 Total deferred tax assets, net 91,254 72,407 Less: valuation allowance (107,822) (88,603) Deferred tax liabilities, net $ (16,568) $ (16,196) |
Schedule of Expected Tax Provision | The expected income tax provision calculated at the statutory federal rate differs from the actual provision as follows: Year Ended December 31, 2023 2022 2021 (in thousands) Tax provision (benefit), at U.S. federal statutory tax rate $ (47,449) $ (15,515) $ 4,402 State income tax provision (benefit), net of federal benefit (440) (3,463) 856 Effect of stock-based compensation tax shortfall 3,394 717 (364) Effect of limitation on executive compensation 1,057 2,511 1,678 Effect of permanent items 447 869 661 Effect of India partnerships 1,366 1,644 1,422 Change in valuation allowance 19,219 26,974 5,660 Effect of change in state and foreign income tax rates 97 (254) (1,184) Uncertain tax positions 1,211 (617) 158 Research and development credits (11,189) (10,993) (5,695) Effect of goodwill impairment 40,282 — — Change in India indefinite reinvestment assertion 3,699 4,372 — Other 1,083 816 73 Income tax provision $ 12,777 $ 7,061 $ 7,667 |
Schedule of Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefit | A reconciliation of the beginning and ending amount of unrecognized tax benefit follows: Year Ended December 31, 2023 2022 2021 (in thousands) Balance at beginning of year $ 13,612 $ 14,517 $ 15,132 Additions based on tax positions related to the current year 2,456 2,522 1,631 Additions (reductions) based on tax positions related to prior years 58 (296) (550) Reductions for settlements with taxing authorities related to prior years — — (394) Reductions for lapses of statute of limitations (839) (3,131) (1,302) Balance at end of year $ 15,287 $ 13,612 $ 14,517 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of the Numerators and Denominators Used in Computing Basic and Diluted Net Income (Loss) Per Share Attributable to Common Stockholders | The following table provides the numerators and denominators used in computing basic and diluted net income (loss) attributable to Envestnet, Inc., per share: Year Ended December 31, 2023 2022 2021 (in thousands, except share and per share amounts) Net income (loss) attributable to Envestnet, Inc. - Basic $ (238,724) $ (80,939) $ 13,296 Interest and gain on settlement of Convertible Notes due 2025, net of interest and tax — (9,524) — Net income (loss) attributable to Envestnet, Inc. - Diluted $ (238,724) $ (90,463) $ 13,296 Weighted-average common shares outstanding: Basic 54,457,365 55,199,482 54,470,975 Effect of dilutive shares: Convertible Notes — 1,642,643 — Non-vested RSUs and PSUs — — 633,384 Options to purchase common stock — — 206,022 Warrants — — 73,715 Diluted 54,457,365 56,842,125 55,384,096 Net income (loss) attributable to Envestnet, Inc., per share: Basic $ (4.38) $ (1.47) $ 0.24 Diluted $ (4.38) $ (1.59) $ 0.24 |
Schedule of Anti-Dilutive Securities Excluded From Computation of Diluted Earnings Per Share | Securities that were anti-dilutive and therefore excluded from the computation of diluted net income (loss) per share were as follows: December 31, 2023 2022 2021 Convertible Notes (1) 11,084,413 11,470,646 9,898,549 Non-vested RSU's and PSU's 1,672,311 1,941,025 — Options to purchase common stock 202,166 277,535 — Total anti-dilutive securities 12,958,890 13,689,206 9,898,549 __________________________________________________________ (1) From 2021 to 2022, this amount increased by 7,837,480 potential common shares associated with the Convertible Notes due 2027 issued in 2022, partially offset by 4,391,743 potential common shares associated with the Convertible Notes due 2023 and 1,873,640 potential common shares associated with the Convertible Notes due 2025 repurchased in 2022. From 2022 to 2023, this amount decreased by 386,233 potential common shares associated with the Convertible Notes due 2023 that matured on June 1, 2023. |
Segment information (Tables)
Segment information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Income (Loss) From Operations by Segment | The following table presents a reconciliation from income (loss) from operations by segment to consolidated net income (loss) attributable to Envestnet, Inc.: Year Ended December 31, 2023 2022 2021 (in thousands) Envestnet Wealth Solutions $ 108,753 $ 57,323 $ 129,287 Envestnet Data & Analytics (216,542) (22,221) (2,603) Nonsegment operating expenses (96,692) (101,126) (86,143) Income (loss) from operations (204,481) (66,024) 40,541 Total other income (expense), net (28,516) (12,395) (20,180) Income (loss) before income tax provision (232,997) (78,419) 20,361 Income tax provision 12,777 7,061 7,667 Net income (loss) (245,774) (85,480) 12,694 Add: Net loss attributable to non-controlling interest 7,050 4,541 602 Net income (loss) attributable to Envestnet, Inc. $ (238,724) $ (80,939) $ 13,296 |
Schedule of Consolidated Total Assets, Consolidated Depreciation and Amortization and Consolidated Capital Expenditures | a summary of total assets, depreciation and amortization and capital expenditures, including both purchases of property and equipment and capitalization of internally developed software, by segment: Total Assets Depreciation and amortization Capital expenditures As of December 31, For the year ended December 31, For the year ended December 31, 2023 2022 2023 2022 2021 2023 2022 2021 (in thousands) Envestnet Wealth Solutions $ 1,562,600 $ 1,560,923 $ 103,301 $ 98,600 $ 91,024 $ 95,777 $ 82,442 $ 66,709 Envestnet Data & Analytics 314,652 551,242 27,003 27,228 26,743 17,525 22,883 22,192 Total $ 1,877,252 $ 2,112,165 $ 130,304 $ 125,828 $ 117,767 $ 113,302 $ 105,325 $ 88,901 |
Organization and Description _2
Organization and Description of Business (Details) managedAccountProduct in Thousands, investmentProduct in Thousands | 12 Months Ended |
Dec. 31, 2023 proprietaryProduct segment managedAccountProduct investmentProduct | |
Number of segments | segment | 2 |
Envestnet Enterprise | |
Number of investment products | investmentProduct | 23 |
Envestnet Portfolio Management Consultants (“PMC”) | |
Number of investment products | managedAccountProduct | 5 |
Number of proprietary products | proprietaryProduct | 850 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Narratives) (Details) | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 USD ($) boardMember | Dec. 31, 2023 USD ($) reportingUnit | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Non-controlling Interest | ||||
Prepaid expenses and other current assets | $ 51,472,000 | $ 47,422,000 | ||
Other assets | 126,723,000 | 107,830,000 | ||
Property and equipment, net | (48,223,000) | (48,481,000) | ||
Direct expense | 473,038,000 | 470,424,000 | $ 423,723,000 | |
General and administrative | 210,113,000 | 218,831,000 | 171,657,000 | |
Depreciation and amortization | (130,304,000) | (125,828,000) | (117,767,000) | |
Net cash provided by operating activities | (154,868,000) | (98,355,000) | (250,577,000) | |
Net cash used in financing activities | 72,706,000 | 108,320,000 | 29,170,000 | |
Allowance for doubtful accounts receivable, current | 2,300,000 | 2,600,000 | ||
Impairment of investments | $ 2,000,000 | 0 | 0 | |
Impairment of property and equipment | 5,100,000 | |||
Number of reporting units | reportingUnit | 2 | |||
Goodwill impairment | $ 191,818,000 | 0 | 0 | |
Intangible asset impairment charges | 0 | 0 | 0 | |
Investment in private companies | $ 4,175,000 | 16,351,000 | $ 25,926,000 | |
Number of board members | boardMember | 2 | |||
Impairment Long Lived Asset Held For Use Statement Of Income Or Comprehensive Income Extensible Enumeration Not Disclosed Flag | impairments of property and equipment | |||
Private Services Company | ||||
Non-controlling Interest | ||||
Ownership interest (as a percent) | 43% | |||
Investment in private companies | $ 1,300,000 | |||
Revision of Prior Period, Error Correction, Adjustment | ||||
Non-controlling Interest | ||||
Prepaid expenses and other current assets | 6,100,000 | |||
Other assets | 7,900,000 | |||
Property and equipment, net | 14,000,000 | |||
Direct expense | 2,000,000 | |||
General and administrative | 2,700,000 | |||
Depreciation and amortization | 4,700,000 | |||
Net cash provided by operating activities | 18,700,000 | |||
Net cash used in financing activities | $ 18,700,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Restricted Cash) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 91,378 | $ 162,173 | $ 429,279 | |
Restricted cash and cash equivalents | 0 | 0 | 149 | |
Total cash, cash equivalents and restricted cash | $ 91,378 | $ 162,173 | $ 429,428 | $ 384,714 |
Acquisitions (Acquisition of Pr
Acquisitions (Acquisition of Proprietary Technology, Narrative) (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Jun. 21, 2021 | Mar. 11, 2021 | May 31, 2023 | Jan. 31, 2023 | Apr. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2023 | |
Business Acquisition [Line Items] | |||||||
Estimated useful life (in years) | 5 years | ||||||
Proprietary technology | |||||||
Business Acquisition [Line Items] | |||||||
Consideration transferred | $ 7 | $ 5 | $ 9 | $ 18 | |||
Estimated useful life (in years) | 5 years | 5 years | 5 years | ||||
Proprietary Technology | |||||||
Business Acquisition [Line Items] | |||||||
Ownership interest (as a percent) | 29% | ||||||
Consideration transferred | $ 35.5 | ||||||
Redemption consideration | 10 | ||||||
Proprietary Technology | Proprietary technology | |||||||
Business Acquisition [Line Items] | |||||||
Finite-lived intangible assets acquired | $ 24.5 |
Acquisitions (Acquisition of Ha
Acquisitions (Acquisition of Harvest, Narrative) (Details) - 401kplans.com acquisition | Apr. 07, 2021 USD ($) |
Business Acquisition [Line Items] | |
Payment to acquire business | $ 32,800,000 |
Escrow deposit | $ 3,000,000 |
Escrow holding period | 18 months |
Goodwill deductible for tax purposes | $ 0 |
Acquisitions (Schedule of Asset
Acquisitions (Schedule of Assets Acquired and Liabilities Assumed, Harvest) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Apr. 07, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 806,563 | $ 998,414 | $ 925,154 | |
401kplans.com acquisition | ||||
Business Acquisition [Line Items] | ||||
Tangible assets acquired, net of cash received | $ 5,310 | |||
Identifiable intangible assets | 9,500 | |||
Goodwill | 18,526 | |||
Total assets acquired | 33,336 | |||
Total liabilities assumed | (542) | |||
Total net assets acquired, net of cash received | $ 32,794 |
Acquisitions (Schedule of Intan
Acquisitions (Schedule of Intangible Assets Acquired, Harvest) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jun. 21, 2021 | Apr. 07, 2021 | Mar. 11, 2021 | May 31, 2023 | Dec. 31, 2023 | |
Business Acquisition [Line Items] | |||||
Estimated Useful Life | 5 years | ||||
Proprietary technology | |||||
Business Acquisition [Line Items] | |||||
Estimated Useful Life | 5 years | 5 years | 5 years | ||
401kplans.com acquisition | |||||
Business Acquisition [Line Items] | |||||
Preliminary Estimate | $ 9,500 | ||||
401kplans.com acquisition | Proprietary technology | |||||
Business Acquisition [Line Items] | |||||
Preliminary Estimate | $ 6,900 | ||||
Estimated Useful Life | 6 years | ||||
401kplans.com acquisition | Customer list | |||||
Business Acquisition [Line Items] | |||||
Preliminary Estimate | $ 2,600 | ||||
Estimated Useful Life | 14 years |
Acquisitions (Acquisition of 40
Acquisitions (Acquisition of 401kplans.com, Narrative) (Details) $ in Millions | May 31, 2022 USD ($) |
401kplans.com | |
Business Acquisition [Line Items] | |
Payment to acquire business | $ 14.5 |
Acquisitions (Schedule of Ass_2
Acquisitions (Schedule of Assets Acquired And Liabilities Assumed, 401kplans.com) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | May 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 806,563 | $ 998,414 | $ 925,154 | |
401kplans.com | ||||
Business Acquisition [Line Items] | ||||
Tangible assets acquired, net of cash received | $ 104 | |||
Identifiable intangible assets | 3,000 | |||
Goodwill | 11,396 | |||
Total net assets acquired, net of cash received | $ 14,500 |
Acquisitions (Schedule of Int_2
Acquisitions (Schedule of Intangible Assets Acquired, 401kplans.com) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
May 31, 2022 | Jun. 21, 2021 | Mar. 11, 2021 | May 31, 2023 | Dec. 31, 2023 | |
Business Acquisition [Line Items] | |||||
Estimated Useful Life | 5 years | ||||
Proprietary technology | |||||
Business Acquisition [Line Items] | |||||
Estimated Useful Life | 5 years | 5 years | 5 years | ||
401kplans.com | Proprietary technology | |||||
Business Acquisition [Line Items] | |||||
Preliminary Estimate | $ 3,000 | ||||
Estimated Useful Life | 5 years |
Acquisitions (Acquisition of Tr
Acquisitions (Acquisition of Truelytics, Narrative) (Details) $ in Millions | Jul. 01, 2022 USD ($) |
Truelytics Inc | |
Business Acquisition [Line Items] | |
Payment to acquire business | $ 20.7 |
Acquisitions (Schedule of Ass_3
Acquisitions (Schedule of Assets Acquired And Liabilities Assumed, Truelytics) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | |||
Goodwill | $ 806,563 | $ 998,414 | $ 925,154 |
Truelytics Inc | |||
Business Acquisition [Line Items] | |||
Tangible assets acquired, net of cash received | 510 | ||
Identifiable intangible assets | 4,000 | ||
Goodwill | 16,217 | ||
Total net assets acquired, net of cash received | $ 20,727 |
Acquisitions (Schedule of Int_3
Acquisitions (Schedule of Intangible Assets Acquired, Truelytics) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Jul. 01, 2022 | Jun. 21, 2021 | Mar. 11, 2021 | May 31, 2023 | Dec. 31, 2023 | |
Business Acquisition [Line Items] | |||||
Estimated Useful Life | 5 years | ||||
Proprietary technology | |||||
Business Acquisition [Line Items] | |||||
Estimated Useful Life | 5 years | 5 years | 5 years | ||
Truelytics Inc | Proprietary technology | |||||
Business Acquisition [Line Items] | |||||
Preliminary Estimate | $ 4,000 | ||||
Estimated Useful Life | 5 years |
Acquisitions (Acquisition of Re
Acquisitions (Acquisition of Redi2 Technologies, Narrative) (Details) - Redi Technologies acquisition - USD ($) $ in Millions | 12 Months Ended | ||
Jul. 01, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | |||
Payments for performance bonuses | $ 2.4 | ||
Goodwill deductible for tax purposes | $ 40.7 | ||
General and Administrative Expense | |||
Business Acquisition [Line Items] | |||
Acquisition related costs | $ 1.5 | ||
Executive Officer | |||
Business Acquisition [Line Items] | |||
Amount of consideration transferred | 68.9 | ||
Contingent consideration | $ 20 |
Acquisitions (Schedule of Ass_4
Acquisitions (Schedule of Assets Acquired And Liabilities Assumed, Redi2 Technologies) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Jul. 01, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 806,563 | $ 998,414 | $ 925,154 | |
Redi Technologies acquisition | ||||
Business Acquisition [Line Items] | ||||
Current assets, net of cash received | $ 1,985 | |||
Other assets | 3,321 | |||
Identifiable intangible assets | 26,500 | |||
Goodwill | 46,467 | |||
Total assets acquired | 78,273 | |||
Accounts payable and accrued expenses | (2,428) | |||
Operating lease liabilities | (2,201) | |||
Deferred revenue | (4,771) | |||
Total liabilities assumed | (9,400) | |||
Total net assets acquired, net of cash received | $ 68,873 |
Acquisitions (Schedule of Int_4
Acquisitions (Schedule of Intangible Assets Acquired, Redi2 Technologies) (Details) - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jul. 01, 2022 | Jun. 21, 2021 | Mar. 11, 2021 | May 31, 2023 | Dec. 31, 2022 | Dec. 31, 2023 | |
Business Acquisition [Line Items] | ||||||
Estimated Useful Life | 5 years | |||||
Proprietary technology | ||||||
Business Acquisition [Line Items] | ||||||
Estimated Useful Life | 5 years | 5 years | 5 years | |||
Redi Technologies acquisition | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets acquired | $ 26,500 | |||||
Redi Technologies acquisition | Customer list | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets acquired | 14,000 | |||||
Redi Technologies acquisition | Customer list | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Estimated Useful Life | 14 years | |||||
Redi Technologies acquisition | Customer list | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Estimated Useful Life | 16 years | |||||
Redi Technologies acquisition | Proprietary technology | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets acquired | $ 9,500 | |||||
Estimated Useful Life | 6 years | |||||
Redi Technologies acquisition | Trade names | ||||||
Business Acquisition [Line Items] | ||||||
Finite-lived intangible assets acquired | $ 3,000 | |||||
Redi Technologies acquisition | Trade names | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Estimated Useful Life | 6 years | |||||
Redi Technologies acquisition | Trade names | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Estimated Useful Life | 7 years |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid technology | $ 14,630 | $ 16,649 |
Prepaid data servers | 7,991 | 6,059 |
Income tax prepayments and receivables | 9,625 | 2,515 |
Prepaid insurance | 2,785 | 2,881 |
Non-income tax receivables | 4,041 | 5,488 |
Other | 12,400 | 13,830 |
Total prepaid expenses and other current assets | $ 51,472 | $ 47,422 |
Property and Equipment, Net (Pr
Property and Equipment, Net (Property and Equipment, Net) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property and equipment, cost: | ||
Total property and equipment | $ 130,264 | $ 129,416 |
Less: accumulated depreciation | (82,041) | (80,935) |
Total property and equipment, net | $ 48,223 | 48,481 |
Computer equipment and software | ||
Property and equipment | ||
Depreciable Life | 3 years | |
Property and equipment, cost: | ||
Total property and equipment | $ 61,852 | 67,230 |
Leasehold improvements | ||
Property and equipment, cost: | ||
Total property and equipment | 38,296 | 36,158 |
Office furniture and fixtures | ||
Property and equipment, cost: | ||
Total property and equipment | $ 11,333 | 10,796 |
Office furniture and fixtures | Minimum | ||
Property and equipment | ||
Depreciable Life | 3 years | |
Office furniture and fixtures | Maximum | ||
Property and equipment | ||
Depreciable Life | 7 years | |
Office equipment and other | ||
Property and equipment, cost: | ||
Total property and equipment | $ 15,114 | 11,563 |
Office equipment and other | Minimum | ||
Property and equipment | ||
Depreciable Life | 3 years | |
Office equipment and other | Maximum | ||
Property and equipment | ||
Depreciable Life | 5 years | |
Building and building improvements | ||
Property and equipment, cost: | ||
Total property and equipment | $ 2,729 | 2,729 |
Building and building improvements | Minimum | ||
Property and equipment | ||
Depreciable Life | 7 years | |
Building and building improvements | Maximum | ||
Property and equipment | ||
Depreciable Life | 39 years | |
Land | ||
Property and equipment, cost: | ||
Total property and equipment | $ 940 | $ 940 |
Property and Equipment, Net (Na
Property and Equipment, Net (Narratives) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Property and equipment | ||
Property and equipment retired | $ 14,073 | $ 30,456 |
Envestnet Wealth Solutions | ||
Property and equipment | ||
Property and equipment retired | 12,900 | 20,000 |
Envestnet Data & Analytics | ||
Property and equipment | ||
Property and equipment retired | $ 1,200 | $ 10,400 |
Property and Equipment, Net (Ac
Property and Equipment, Net (Accumulated Depreciation Written Off by Category) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Property and equipment | ||
Cost | $ 14,073 | $ 30,456 |
Accumulated Depreciation | (13,735) | (25,359) |
Computer equipment and software | ||
Property and equipment | ||
Cost | 12,269 | 15,887 |
Accumulated Depreciation | (12,267) | (14,947) |
Leasehold improvements | ||
Property and equipment | ||
Cost | 934 | 2,442 |
Accumulated Depreciation | (860) | (1,209) |
Office furniture and fixtures | ||
Property and equipment | ||
Cost | 721 | 660 |
Accumulated Depreciation | (551) | (418) |
Office equipment and other | ||
Property and equipment | ||
Cost | 149 | 11,467 |
Accumulated Depreciation | $ (57) | $ (8,785) |
Internally Developed Software_3
Internally Developed Software, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Components of intangible assets | ||
Less: accumulated amortization | $ (180,365) | $ (128,642) |
Internally developed software, net | $ 224,713 | 184,558 |
Internally developed software | ||
Components of intangible assets | ||
Estimated Useful Life | 5 years | |
Internally developed software | $ 405,078 | $ 313,200 |
Geographical Information (Detai
Geographical Information (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | $ 272,936 | $ 233,039 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | 270,381 | 231,855 |
India | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | 2,555 | 1,093 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | $ 0 | $ 91 |
Intangible Assets, Net (Intangi
Intangible Assets, Net (Intangible Assets, Net) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Components of intangible assets | ||
Gross Carrying Amount | $ 712,838 | $ 733,004 |
Accumulated Amortization | (374,770) | (353,009) |
Net Carrying Amount | 338,068 | 379,995 |
Customer lists | ||
Components of intangible assets | ||
Gross Carrying Amount | 604,080 | 604,080 |
Accumulated Amortization | (327,042) | (285,288) |
Net Carrying Amount | 277,038 | 318,792 |
Proprietary technologies | ||
Components of intangible assets | ||
Gross Carrying Amount | 93,058 | 113,224 |
Accumulated Amortization | (37,052) | (59,401) |
Net Carrying Amount | 56,006 | 53,823 |
Trade names | ||
Components of intangible assets | ||
Gross Carrying Amount | 15,700 | 15,700 |
Accumulated Amortization | (10,676) | (8,320) |
Net Carrying Amount | $ 5,024 | $ 7,380 |
Intangible Assets, Net (Narrati
Intangible Assets, Net (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 21, 2021 | Mar. 11, 2021 | May 31, 2023 | Jan. 31, 2023 | Apr. 30, 2022 | Feb. 28, 2022 | Jun. 30, 2021 | Dec. 31, 2023 | Mar. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Components of intangible assets | ||||||||||||
Payments to acquire intangible assets | $ 17,000 | $ 19,000 | $ 28,517 | |||||||||
Payment to acquire assets | 113,302 | 105,325 | 88,901 | |||||||||
Estimated useful life | 5 years | |||||||||||
Envestnet Wealth Solutions | ||||||||||||
Components of intangible assets | ||||||||||||
Cost of fully amortized and retired assets | $ 40,500 | 40,500 | ||||||||||
Payment to acquire assets | $ 95,777 | 82,442 | $ 66,709 | |||||||||
Envestnet Data & Analytics | ||||||||||||
Components of intangible assets | ||||||||||||
Cost of fully amortized and retired assets | 25,100 | |||||||||||
Proprietary technology | ||||||||||||
Components of intangible assets | ||||||||||||
Consideration transferred | $ 7,000 | $ 5,000 | $ 9,000 | $ 18,000 | ||||||||
Payments to acquire intangible assets | $ 2,000 | $ 4,000 | $ 3,000 | $ 5,000 | $ 10,000 | |||||||
Payment to acquire assets | $ 15,000 | |||||||||||
Estimated useful life | 5 years | 5 years | 5 years | |||||||||
Earn-out payment | $ 10,000 | |||||||||||
Target metrics term | 5 years | |||||||||||
Proprietary technology | Envestnet Data & Analytics | ||||||||||||
Components of intangible assets | ||||||||||||
Cost of fully amortized and retired assets | $ 2,500 |
Intangible Assets, Net (Future
Intangible Assets, Net (Future Amortization Expense) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Future amortization expense of the intangible assets | ||
2024 | $ 57,368 | |
2025 | 53,973 | |
2026 | 46,448 | |
2027 | 37,672 | |
2028 | 30,296 | |
Thereafter | 112,311 | |
Net Carrying Amount | $ 338,068 | $ 379,995 |
Depreciation and Amortization_3
Depreciation and Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Intangible asset amortization | $ 62,927 | $ 71,901 | $ 68,587 |
Internally developed software amortization | 52,422 | 36,959 | 28,603 |
Property and equipment depreciation | 14,955 | 16,968 | 20,577 |
Total depreciation and amortization | $ 130,304 | $ 125,828 | $ 117,767 |
Goodwill (Details)
Goodwill (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in the carrying amount of the Company's goodwill | |||
Balance at period start | $ 998,414,000 | $ 925,154,000 | |
Acquisition | 74,080,000 | ||
Foreign currency translation | (33,000) | (820,000) | |
Goodwill impairment | (191,818,000) | 0 | $ 0 |
Balance at period end | 806,563,000 | 998,414,000 | 925,154,000 |
Envestnet Wealth Solutions | |||
Changes in the carrying amount of the Company's goodwill | |||
Balance at period start | 710,326,000 | 636,246,000 | |
Acquisition | 74,080,000 | ||
Foreign currency translation | 0 | 0 | |
Goodwill impairment | 0 | ||
Balance at period end | 710,326,000 | 710,326,000 | 636,246,000 |
Envestnet Data & Analytics | |||
Changes in the carrying amount of the Company's goodwill | |||
Balance at period start | 288,088,000 | 288,908,000 | |
Acquisition | 0 | ||
Foreign currency translation | (33,000) | (820,000) | |
Goodwill impairment | (191,818,000) | ||
Balance at period end | $ 96,237,000 | $ 288,088,000 | $ 288,908,000 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Jan. 31, 2023 | |
Other Asset [Line Items] | ||
Impairment of investments | $ 0 | |
Notes Receivable | ||
Other Asset [Line Items] | ||
Receivable with imputed interest, face amount | $ 20 | |
Interest rate (as a percent) | 8% | |
Notes Receivable | Other Nonoperating Income (Expense) | ||
Other Asset [Line Items] | ||
Interest income | $ 1.5 |
Investments (Narratives) (Detai
Investments (Narratives) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Sep. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2023 USD ($) qtr | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Jun. 30, 2023 qtr | |
Schedule of Equity Method Investments [Line Items] | ||||||||
Equity method investments | $ 37,400 | $ 33,500 | $ 37,400 | |||||
Future funding commitment | 8,800 | |||||||
Total revenue | 1,245,620 | 1,239,784 | $ 1,186,517 | |||||
Net receivable | 101,696 | 120,958 | 101,696 | |||||
Issuance of note receivable to equity method investees | 0 | 6,350 | 0 | |||||
Investment in private companies | 4,175 | 16,351 | 25,926 | |||||
Intangible assets, net | 379,995 | $ 338,068 | 379,995 | |||||
Amortization period | 5 years | |||||||
Historical purchase price | $ 22,100 | $ 22,800 | 22,100 | |||||
Impairment of investments | $ 2,000 | 0 | 0 | |||||
Private Services Company | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Ownership interest (as a percent) | 3.76% | |||||||
Dilution gain on equity method investee share issuance | $ 2,600 | |||||||
Private Services Company | Minimum | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Ownership interest (as a percent) | 3% | 4% | 3% | |||||
Private Services Company | Maximum | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Ownership interest (as a percent) | 48% | 55% | 48% | |||||
Private Services Company | Related Party | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Total revenue | $ 12,300 | $ 16,000 | $ 16,400 | |||||
Net receivable | $ 2,000 | $ 1,700 | 2,000 | |||||
Privately Held Company | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Ownership interest (as a percent) | 48% | 41% | ||||||
Dilution gain on equity method investee share issuance | $ 6,900 | |||||||
Issuance of note receivable to equity method investees | $ 2,500 | |||||||
Investment in private companies | $ 8,400 | |||||||
Number of quarter lag from actual result | qtr | 1 | |||||||
Intangible assets, net | $ 7,800 | |||||||
Privately Held Company Two | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Ownership interest (as a percent) | 25% | |||||||
Future funding commitment | 7,500 | |||||||
Investment in private companies | $ 5,000 | 10,000 | 2,500 | |||||
Number of quarter lag from actual result | qtr | 1 | |||||||
Other Equity Investments | Level II | ||||||||
Schedule of Equity Method Investments [Line Items] | ||||||||
Historical purchase price | $ 400 | $ 2,800 | $ 400 |
Investments (Schedule of Equity
Investments (Schedule of Equity Method Investment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Balance Sheets | |||
Current assets | $ 263,808 | $ 311,291 | |
Current liabilities | 292,534 | 327,064 | |
Statements of Operations | |||
Loss from operations | (204,481) | (66,024) | $ 40,541 |
Net loss | (245,774) | (85,480) | 12,694 |
Envestnet’s proportional share of gains (losses) | (238,724) | (80,939) | 13,296 |
Equity Method Investments, Total | |||
Balance Sheets | |||
Current assets | 68,602 | 42,059 | |
Other assets | 66,016 | 50,703 | |
Current liabilities | 17,150 | 17,647 | |
Other liabilities | 1,857 | 9,437 | |
Statements of Operations | |||
Revenue | 71,815 | 79,062 | 65,085 |
Loss from operations | (16,733) | (8,896) | (149) |
Net loss | (20,235) | (7,124) | (134) |
Envestnet’s proportional share of gains (losses) | (10,033) | 643 | $ (7,093) |
Dilution gain on equity method investee share issuance | $ 500 | $ 9,500 |
Accounts Payable, Accrued Exp_3
Accounts Payable, Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued investment manager fees | $ 106,612 | $ 99,851 |
Accrued compensation and related taxes | 72,466 | 77,939 |
Accounts payable | 35,738 | 11,271 |
Accrued professional services | 14,289 | 10,762 |
Accrued technology | 4,151 | 6,393 |
Accrued interest | 2,473 | 3,091 |
Accrued treasury stock purchases | 0 | 9,289 |
Other accrued expenses | 5,695 | 15,270 |
Total accrued expenses and other current liabilities | $ 241,424 | $ 233,866 |
Accounts Payable, Accrued Exp_4
Accounts Payable, Accrued Expenses and Other Current Liabilities - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||||
Severance expense | $ 35,399 | $ 30,117 | ||
Accrued severance | 10,279 | 15,368 | $ 5,480 | |
Cash payments | $ 40,488 | $ 20,229 | ||
Forecast | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Cash payments | $ 9,200 |
Accounts Payable, Accrued Exp_5
Accounts Payable, Accrued Expenses and Other Current Liabilities (Restructuring and Related Costs) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Restructuring Reserve [Roll Forward] | |||
Beginning balance | $ 10,279 | $ 15,368 | $ 5,480 |
Severance expense | 35,399 | 30,117 | |
Cash payments | (40,488) | (20,229) | |
Ending balance | 10,279 | 15,368 | |
Forecast | |||
Restructuring Reserve [Roll Forward] | |||
Cash payments | (9,200) | ||
Operating Segments | Envestnet Wealth Solutions | |||
Restructuring Reserve [Roll Forward] | |||
Beginning balance | 9,793 | 12,582 | 4,670 |
Severance expense | 17,232 | 13,237 | |
Cash payments | (20,021) | (5,325) | |
Ending balance | 9,793 | 12,582 | |
Operating Segments | Envestnet Data & Analytics | |||
Restructuring Reserve [Roll Forward] | |||
Beginning balance | 486 | 2,786 | 810 |
Severance expense | 11,813 | 10,745 | |
Cash payments | (14,113) | (8,769) | |
Ending balance | 486 | 2,786 | |
Nonsegment | |||
Restructuring Reserve [Roll Forward] | |||
Beginning balance | $ 0 | 0 | 0 |
Severance expense | 6,354 | 6,135 | |
Cash payments | (6,354) | (6,135) | |
Ending balance | $ 0 | $ 0 |
Debt (Summary of Outstanding De
Debt (Summary of Outstanding Debt) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Convertible Notes Payable | ||
Debt Instrument [Line Items] | ||
Issuance Amount | $ 892,500 | $ 937,500 |
Unamortized Issuance Costs | (15,888) | (20,845) |
Carrying Value | 876,612 | 916,655 |
Convertible Notes Payable | Level II | ||
Debt Instrument [Line Items] | ||
Fair Value (Level II) | 866,704 | 945,865 |
Convertible Notes Payable | Convertible Notes due 2023 | ||
Debt Instrument [Line Items] | ||
Issuance Amount | 45,000 | |
Unamortized Issuance Costs | (114) | |
Carrying Value | 44,886 | |
Convertible Notes Payable | Convertible Notes due 2023 | Level II | ||
Debt Instrument [Line Items] | ||
Fair Value (Level II) | 46,058 | |
Convertible Notes Payable | Convertible Notes due 2025 | ||
Debt Instrument [Line Items] | ||
Issuance Amount | 317,500 | 317,500 |
Unamortized Issuance Costs | (2,968) | (4,765) |
Carrying Value | 314,532 | 312,735 |
Convertible Notes Payable | Convertible Notes due 2025 | Level II | ||
Debt Instrument [Line Items] | ||
Fair Value (Level II) | 294,958 | 293,688 |
Convertible Notes Payable | Convertible Notes due 2027 | ||
Debt Instrument [Line Items] | ||
Issuance Amount | 575,000 | 575,000 |
Unamortized Issuance Costs | (12,920) | (15,966) |
Carrying Value | 562,080 | 559,034 |
Convertible Notes Payable | Convertible Notes due 2027 | Level II | ||
Debt Instrument [Line Items] | ||
Fair Value (Level II) | 571,746 | 606,119 |
Revolving Credit Facility | Line of Credit | Third Credit Agreement | ||
Debt Instrument [Line Items] | ||
Issuance Amount | 0 | 0 |
Unamortized Issuance Costs | 0 | 0 |
Carrying Value | 0 | 0 |
Revolving Credit Facility | Line of Credit | Third Credit Agreement | Level II | ||
Debt Instrument [Line Items] | ||
Fair Value (Level II) | $ 0 | $ 0 |
Debt (Credit Agreement) (Detail
Debt (Credit Agreement) (Details) - USD ($) | 12 Months Ended | ||
Feb. 04, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Revolving Credit Facility | Line of Credit | |||
Debt Instrument [Line Items] | |||
Debt issuance costs, gross | $ 1,900,000 | ||
Write off of debt issuance cost | $ 600,000 | ||
Third Credit Agreement | Line of Credit | Minimum | Base Rate | |||
Debt Instrument [Line Items] | |||
Spread on variable rate basis (as a percent) | 0.25% | ||
Third Credit Agreement | Line of Credit | Minimum | SOFR | |||
Debt Instrument [Line Items] | |||
Spread on variable rate basis (as a percent) | 1.25% | ||
Third Credit Agreement | Line of Credit | Maximum | Base Rate | |||
Debt Instrument [Line Items] | |||
Spread on variable rate basis (as a percent) | 1.75% | ||
Third Credit Agreement | Line of Credit | Maximum | SOFR | |||
Debt Instrument [Line Items] | |||
Spread on variable rate basis (as a percent) | 2.75% | ||
Third Credit Agreement | Other non-current assets | Line of Credit | |||
Debt Instrument [Line Items] | |||
Debt issuance costs | $ 1,500,000 | $ 2,200,000 | |
Third Credit Agreement | Prepaid Expenses | Line of Credit | |||
Debt Instrument [Line Items] | |||
Debt issuance costs | 700,000 | 700,000 | |
Third Credit Agreement | Revolving Credit Facility | Line of Credit | |||
Debt Instrument [Line Items] | |||
Credit facility amount | $ 500,000,000 | ||
Debt settlement amounts outstanding under the revolving credit facility | $ 0 | $ 0 | |
Third Credit Agreement | Letters of credit | Line of Credit | |||
Debt Instrument [Line Items] | |||
Credit facility amount | $ 20,000,000 | ||
Amended Credit Agreement | Revolving Credit Facility | Minimum | |||
Debt Instrument [Line Items] | |||
Commitment fee (as a percent) | 0.25% | ||
Amended Credit Agreement | Revolving Credit Facility | Maximum | |||
Debt Instrument [Line Items] | |||
Commitment fee (as a percent) | 0.30% |
Debt (Convertible Notes) (Detai
Debt (Convertible Notes) (Details) $ / shares in Units, shares in Millions | 1 Months Ended | 12 Months Ended | |||||
Jun. 01, 2023 USD ($) | Nov. 30, 2022 USD ($) $ / shares shares | Aug. 31, 2020 USD ($) day $ / shares | May 31, 2018 USD ($) | Dec. 31, 2023 USD ($) shares | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | |||||||
Purchase of Capped Call Transactions | $ (79,585,000) | ||||||
Additional Paid-in Capital | |||||||
Debt Instrument [Line Items] | |||||||
Purchase of Capped Call Transactions | $ (79,600,000) | (79,585,000) | |||||
Convertible Notes Payable | |||||||
Debt Instrument [Line Items] | |||||||
Unamortized Issuance Costs | (15,888,000) | (20,845,000) | |||||
Convertible Notes due 2023 | |||||||
Debt Instrument [Line Items] | |||||||
Repurchase of convertible debt | 0 | 312,422,000 | $ 0 | ||||
Gain (loss) on extinguishment of debt | 0 | (13,421,000) | 0 | ||||
Convertible Notes due 2023 | Convertible Notes Payable | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 345,000,000 | ||||||
Interest rate (as a percent) | 1.75% | ||||||
Repurchase amount | $ 300,000,000 | ||||||
Repurchase of convertible debt | $ 45,000,000 | 312,400,000 | |||||
Gain (loss) on extinguishment of debt | (13,400,000) | ||||||
Convertible Notes due 2025 | |||||||
Debt Instrument [Line Items] | |||||||
Conversion rate (in shares) | 0.0093682 | ||||||
Repurchase of convertible debt | 0 | 181,772,000 | 0 | ||||
Gain (loss) on extinguishment of debt | $ 0 | $ 15,089,000 | $ 0 | ||||
Convertible Notes due 2025 | Convertible Notes Payable | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 517,500,000 | ||||||
Interest rate (as a percent) | 0.75% | ||||||
Repurchase percentage of principal (as a percent) | 100% | ||||||
Threshold percentage of stock price trigger (as a percent) | 130% | ||||||
Threshold trading days | day | 20 | ||||||
Consecutive trading days | day | 30 | ||||||
Threshold consecutive trading-day period | 5 days | ||||||
Conversion price (in dollars per share) | $ / shares | $ 106.74 | ||||||
Repurchase amount | 200,000,000 | ||||||
Repurchase of convertible debt | 181,800,000 | ||||||
Gain (loss) on extinguishment of debt | $ 15,100,000 | ||||||
Shares Issuable(in shares) | shares | 3 | ||||||
Threshold business days | 5 days | ||||||
Threshold percentage of trading price trigger (as a percent) | 98% | ||||||
Convertible Notes due 2027 | |||||||
Debt Instrument [Line Items] | |||||||
Conversion rate (in shares) | 0.0136304 | ||||||
Convertible Notes due 2027 | Convertible Notes Payable | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 575,000,000 | ||||||
Interest rate (as a percent) | 2.625% | ||||||
Conversion price (in dollars per share) | $ / shares | $ 73.37 | $ 73.37 | |||||
Conversion price, cap (in dollars per share) | $ / shares | $ 110.74 | ||||||
Shares converted (in shares) | shares | 7.8 |
Debt (Interest Expense) (Detail
Debt (Interest Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Disclosure [Abstract] | |||
Convertible Notes interest | $ 17,845 | $ 10,897 | $ 9,919 |
Amortization of debt discount and issuance costs | 5,655 | 4,678 | 5,745 |
Undrawn and other fees | 1,255 | 1,268 | 1,267 |
Revolving Credit Facility interest | 383 | 0 | 0 |
Total interest expense | 25,138 | $ 16,843 | $ 16,931 |
Convertible Debt | |||
Debt Instrument [Line Items] | |||
Gain (loss) on extinguishment of debt | $ 1,700 |
Debt (Effective Interest Rate o
Debt (Effective Interest Rate of Notes) (Details) - Convertible Notes Payable | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Convertible Notes due 2023 | |||
Debt Instrument [Line Items] | |||
Effective interest rate (as a percent) | 2.40% | 2.40% | |
Convertible Notes due 2025 | |||
Debt Instrument [Line Items] | |||
Effective interest rate (as a percent) | 1.30% | 1.30% | 1.30% |
Convertible Notes due 2027 | |||
Debt Instrument [Line Items] | |||
Effective interest rate (as a percent) | 3.20% | 3.20% |
Leases (Narratives) (Details)
Leases (Narratives) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Facility Closing | |||
Lessee, Lease, Description [Line Items] | |||
Lease termination expense | $ 5.1 | $ 13 | $ 1.5 |
Leases (Schedule of Companys Le
Leases (Schedule of Companys Leases) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Leases [Abstract] | |||
Total operating lease cost | $ 17,549 | $ 15,157 | $ 18,600 |
Short-term lease cost | $ 16,203 | $ 12,445 | $ 4,940 |
Weighted-average remaining lease term (in years) | 8 years 6 months | 9 years 2 months 12 days | 9 years 9 months 18 days |
Weighted-average discount rate | 4.90% | 5% | 5.10% |
Cash paid for amounts included in the measurement of lease liabilities | $ 16,718 | $ 15,748 | $ 18,052 |
Leases (Future Minimum Lease Pa
Leases (Future Minimum Lease Payments) (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Leases [Abstract] | |
2024 | $ 18,204 |
2025 | 15,590 |
2026 | 15,450 |
2027 | 15,582 |
2028 | 15,889 |
Thereafter | 59,316 |
Total lease payments | 140,031 |
Less: imputed interest | (26,292) |
Total operating lease liabilities | $ 113,739 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Dec. 20, 2018 | Dec. 31, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2016 | |
Stockholders' equity | ||||||
Shares authorized for repurchase (in shares) | 2,000,000 | |||||
Share repurchases (in shares) | 0 | |||||
Repurchase of common stock | $ 1,008 | $ 95,039 | $ 4,001 | |||
Remaining shares authorized for repurchase (maximum) (in shares) | 331,260 | |||||
Treasury Stock | ||||||
Stockholders' equity | ||||||
Share repurchases (in shares) | 0 | 1,569,642 | 55,488 | |||
Repurchase of common stock | $ 0 | $ 95,039 | $ 4,001 | |||
Common Stock | ||||||
Stockholders' equity | ||||||
Issuance of common stock (in shares) | 78,677 | 78,677 | ||||
Common Stock | Private Placement | Warrant | ||||||
Stockholders' equity | ||||||
Number of shares issued in transaction (in shares) | 470,000 | |||||
Sale of stock (in dollars per share) | $ 65.16 | |||||
Warrants exercisable period (in years) | 4 years |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule of Fair Value Assets and Liabilities) (Details) - Recurring Basis - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Level I | ||
Assets: | ||
Assets to fund deferred compensation liability | $ 0 | $ 0 |
Total assets | 51,653 | 2,628 |
Liabilities: | ||
Deferred compensation liability | 8,045 | 8,088 |
Total liabilities | 8,045 | 8,088 |
Level I | Money market funds | ||
Assets: | ||
Money market funds | 51,653 | 2,628 |
Level II | ||
Assets: | ||
Assets to fund deferred compensation liability | 0 | 0 |
Total assets | 0 | 0 |
Liabilities: | ||
Deferred compensation liability | 0 | 0 |
Total liabilities | 0 | 0 |
Level II | Money market funds | ||
Assets: | ||
Money market funds | 0 | 0 |
Level III | ||
Assets: | ||
Assets to fund deferred compensation liability | 10,961 | 10,074 |
Total assets | 10,961 | 10,074 |
Liabilities: | ||
Deferred compensation liability | 0 | 0 |
Total liabilities | 0 | 0 |
Level III | Money market funds | ||
Assets: | ||
Money market funds | 0 | 0 |
Fair Value | ||
Assets: | ||
Assets to fund deferred compensation liability | 10,961 | 10,074 |
Total assets | 62,614 | 12,702 |
Liabilities: | ||
Deferred compensation liability | 8,045 | 8,088 |
Total liabilities | 8,045 | 8,088 |
Fair Value | Money market funds | ||
Assets: | ||
Money market funds | $ 51,653 | $ 2,628 |
Fair Value Measurements (Reconc
Fair Value Measurements (Reconciliation of Deferred Compensation Liability and Contingent Consideration Liability) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Contingent Consideration Liability | ||
Beginning balance | $ 0 | $ 743 |
Payments | (743) | |
Contributions | 0 | |
Fair value adjustments and fees | 0 | 0 |
Ending balance | 0 | 0 |
Assets to Fund Deferred Compensation Liability | ||
Beginning balance | 10,074 | 11,140 |
Payments | 0 | |
Contributions | 649 | |
Fair value adjustments and fees | 887 | (1,715) |
Ending balance | $ 10,961 | $ 10,074 |
Fair Value, Asset, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | General and administrative |
Revenue and Direct Expense (Dis
Revenue and Direct Expense (Disaggregation of Revenue) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue: | |||
Total revenue | $ 1,245,620 | $ 1,239,784 | $ 1,186,517 |
United States | |||
Revenue: | |||
Total revenue | 1,223,246 | 1,218,254 | 1,166,251 |
International | |||
Revenue: | |||
Total revenue | 22,374 | 21,530 | 20,266 |
Total recurring revenue | |||
Revenue: | |||
Total revenue | 1,209,968 | 1,216,072 | 1,163,365 |
Asset-based | |||
Revenue: | |||
Total revenue | 745,238 | 738,228 | 709,376 |
Subscription-based | |||
Revenue: | |||
Total revenue | 464,730 | 477,844 | 453,989 |
Professional services and other revenue | |||
Revenue: | |||
Total revenue | 35,652 | 23,712 | 23,152 |
Envestnet Wealth Solutions | |||
Revenue: | |||
Total revenue | 1,094,704 | 1,065,244 | 1,003,642 |
Envestnet Wealth Solutions | Total recurring revenue | |||
Revenue: | |||
Total revenue | 1,070,636 | 1,048,445 | 989,452 |
Envestnet Wealth Solutions | Asset-based | |||
Revenue: | |||
Total revenue | 745,238 | 738,228 | 709,376 |
Envestnet Wealth Solutions | Subscription-based | |||
Revenue: | |||
Total revenue | 325,398 | 310,217 | 280,076 |
Envestnet Wealth Solutions | Professional services and other revenue | |||
Revenue: | |||
Total revenue | 24,068 | 16,799 | 14,190 |
Envestnet Data & Analytics | |||
Revenue: | |||
Total revenue | 150,916 | 174,540 | 182,875 |
Envestnet Data & Analytics | Total recurring revenue | |||
Revenue: | |||
Total revenue | 139,332 | 167,627 | 173,913 |
Envestnet Data & Analytics | Asset-based | |||
Revenue: | |||
Total revenue | 0 | 0 | 0 |
Envestnet Data & Analytics | Subscription-based | |||
Revenue: | |||
Total revenue | 139,332 | 167,627 | 173,913 |
Envestnet Data & Analytics | Professional services and other revenue | |||
Revenue: | |||
Total revenue | $ 11,584 | $ 6,913 | $ 8,962 |
Revenue and Direct Expense (Maj
Revenue and Direct Expense (Major Customers) (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Revenues | Customer concentration risk | Fidelity | |||
Major Customers | |||
Revenue as a percentage of the company's total | 16% | 16% | 17% |
Revenue and Direct Expense (Rem
Revenue and Direct Expense (Remaining Performance Obligations) (Details) $ in Millions | Dec. 31, 2023 USD ($) |
Remaining Performance Obligations | |
Remaining performance obligations | $ 534.2 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Remaining Performance Obligations | |
Revenue, remaining performance obligation, percentage | 41% |
Revenue recognition period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Remaining Performance Obligations | |
Revenue, remaining performance obligation, percentage | 45% |
Revenue recognition period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Remaining Performance Obligations | |
Revenue, remaining performance obligation, percentage | 12% |
Revenue recognition period |
Revenue and Direct Expense (Con
Revenue and Direct Expense (Contract Balances) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
Deferred revenue period increase (decrease) | $ 0.7 | $ 4.9 |
Recognized deferred revenue | $ 35.6 | $ 33.1 |
Revenue and Direct Expense (Def
Revenue and Direct Expense (Deferred Sales Incentive Compensation) (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
Deferred sales incentive compensation | $ 11,500,000 | $ 11,000,000 |
Amortization expense for the deferred sales incentive compensation | 4,800,000 | 4,300,000 |
Impairment loss for capitalized costs | $ 0 | $ 0 |
Revenue and Direct Expense (Cos
Revenue and Direct Expense (Cost of Revenues) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||
Direct expense | $ 473,038 | $ 470,424 | $ 423,723 |
Asset-based | |||
Disaggregation of Revenue [Line Items] | |||
Direct expense | 434,123 | 430,345 | 393,717 |
Subscription-based | |||
Disaggregation of Revenue [Line Items] | |||
Direct expense | 30,814 | 32,577 | 29,445 |
Professional services and other revenue | |||
Disaggregation of Revenue [Line Items] | |||
Direct expense | $ 8,101 | $ 7,502 | $ 561 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narratives) (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
May 01, 2019 | Jun. 22, 2010 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Maximum number of shares available for future issuance (in shares) | 1,819,036 | ||||
U.S. federal corporate income tax rate | 25.50% | 25.50% | 25.50% | ||
Target Incentive Awards | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period (in years) | 3 years | ||||
Unrecognized compensation expense weighted-average recognition period | 1 year 1 month 6 days | ||||
Unrecognized compensation expense related to shares | $ 1.9 | ||||
Target Incentive Awards | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares to be vest upon each evaluation date (as a percent) | 0% | ||||
Target Incentive Awards | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares to be vest upon each evaluation date (as a percent) | 150% | ||||
Restricted Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Unrecognized compensation expense weighted-average recognition period | 1 year 8 months 12 days | ||||
Unrecognized compensation expense related to shares | $ 67.4 | ||||
Restricted Stock Units | Tranche One | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percent (as a percent) | 33.333% | ||||
Restricted Stock Units | Tranche Three | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percent (as a percent) | 33.333% | ||||
Restricted Stock Units | Tranche Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting percent (as a percent) | 33.333% | ||||
2010 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based awards, contractual term | 10 years | ||||
Shares authorized for issuance (in shares) | 12,375,000 | ||||
Equity Plan | PIEtech | Restricted Stock Units and Performance Stock Units | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Shares authorized for issuance (in shares) | 301,469 | ||||
Future grant date | 60 days | ||||
Equity Plan | PIEtech | Restricted Stock Units and Performance Stock Units | Minimum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period (in years) | 3 years | ||||
Equity Plan | PIEtech | Restricted Stock Units and Performance Stock Units | Maximum | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Vesting period (in years) | 5 years |
Stock-Based Compensation (Compe
Stock-Based Compensation (Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Summary of employee stock-based compensation expense | |||
Stock-based compensation expense | $ 71,031 | $ 79,581 | $ 67,525 |
Tax effect on stock-based compensation expense | (18,113) | (20,293) | (17,219) |
Net effect on income (loss) | $ 52,918 | $ 59,288 | $ 50,306 |
Stock-Based Compensation (Weigh
Stock-Based Compensation (Weighted Average Assumptions) (Details) | 12 Months Ended |
Dec. 31, 2021 $ / shares | |
Summary of weighted average assumptions used to value options granted | |
Grant date fair value of options (in dollars per share) | $ 31.23 |
Expected volatility | 42.10% |
Risk-free interest rate | 0.40% |
Expected dividend yield | 0% |
Expected term (in years) | 6 years 6 months |
Stock-Based Compensation (Stock
Stock-Based Compensation (Stock Options) (Details) - Stock Option $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) $ / shares shares | |
Options | |
Outstanding at the beginning of the period (in shares) | shares | 277,535 |
Exercised (in shares) | shares | (72,410) |
Forfeited (in shares) | shares | (2,959) |
Outstanding at the end of the period (in shares) | shares | 202,166 |
Options exercisable (in shares) | shares | 202,166 |
Weighted-Average Exercise Price | |
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 40.07 |
Exercised (in dollars per share) | $ / shares | 25.07 |
Forfeited (in dollars per share) | $ / shares | 55.28 |
Outstanding at the end of the period (in dollars per share) | $ / shares | 45.22 |
Options exercisable (in dollars per share) | $ / shares | $ 45.22 |
Weighted-Average Remaining Contractual Life | |
Outstanding | 1 year 7 months 6 days |
Options exercisable | 1 year 7 months 6 days |
Aggregate Intrinsic Value | |
Outstanding | $ | $ 1,330 |
Options exercisable | $ | $ 1,330 |
Stock-Based Compensation (Sched
Stock-Based Compensation (Schedule of Other Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Intrinsic value of options exercised | $ 2,243 | $ 2,650 | $ 3,815 |
Cash received from exercises of stock options | $ 1,608 | $ 2,620 | $ 2,090 |
Stock-Based Compensation (Restr
Stock-Based Compensation (Restricted Stock Units and Restricted Stock Awards) (Details) | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Restricted Stock Units | |
Number of Shares | |
Balance at the beginning of the period (in shares) | shares | 1,681,976 |
Granted (in shares) | shares | 1,106,853 |
Vested (in shares) | shares | (1,006,719) |
Forfeited (in shares) | shares | (332,857) |
Balance at the end of the period (in shares) | shares | 1,449,253 |
Weighted-Average Grant Date Fair Value per Share | |
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 72.69 |
Granted (in dollars per share) | $ / shares | 61.01 |
Vested (in dollars per share) | $ / shares | 72.75 |
Forfeited (in dollars per share) | $ / shares | 63.75 |
Balance at the end of the period (in dollars per share) | $ / shares | $ 65.78 |
PSUs | |
Number of Shares | |
Balance at the beginning of the period (in shares) | shares | 259,049 |
Granted (in shares) | shares | 40,010 |
Vested (in shares) | shares | (24,939) |
Forfeited (in shares) | shares | (51,062) |
Balance at the end of the period (in shares) | shares | 223,058 |
Weighted-Average Grant Date Fair Value per Share | |
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 74.83 |
Granted (in dollars per share) | $ / shares | 69.47 |
Vested (in dollars per share) | $ / shares | 107.10 |
Forfeited (in dollars per share) | $ / shares | 63.21 |
Balance at the end of the period (in dollars per share) | $ / shares | $ 72.92 |
Benefit Plan (Details)
Benefit Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Voluntary employer matching contributions | $ 8,100 | $ 8,100 | $ 6,900 |
Income Taxes (Loss Before Incom
Income Taxes (Loss Before Income Tax Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Summary of Income before income tax provision | |||
Domestic | $ (240,904) | $ (89,000) | $ 9,730 |
Foreign | 7,907 | 10,581 | 10,631 |
Income (loss) before income tax provision | $ (232,997) | $ (78,419) | $ 20,361 |
Income Taxes (Components of Inc
Income Taxes (Components of Income Tax Expense (Benefit)) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | |||
Federal | $ 8,774 | $ 1,185 | $ 0 |
State | 4,894 | 6,964 | 3,488 |
Foreign | 588 | 2,402 | 4,499 |
Current income tax provision | 14,256 | 10,551 | 7,987 |
Deferred: | |||
Federal | 2,138 | (2,453) | 4,021 |
State | (4,399) | (1,439) | (3,548) |
Foreign | 782 | 402 | (793) |
Deferred Total | (1,479) | (3,490) | (320) |
Total | $ 12,777 | $ 7,061 | $ 7,667 |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Income Tax Disclosure [Abstract] | ||
Deferred revenue | $ 8,699 | $ 8,945 |
Prepaid expenses and accrued expenses | 6,663 | 8,847 |
Right-of-use assets | (17,528) | (20,388) |
Lease liabilities | 29,497 | 31,328 |
Net operating loss and tax credit carryforwards | 63,866 | 64,590 |
Property and equipment and intangible assets | (84,139) | (94,061) |
Stock-based compensation expense | 9,215 | 10,559 |
Investment in partnerships | (4,416) | |
Investment in partnerships | 2,836 | |
Convertible Notes | 16,754 | 20,440 |
R&D expenditures | 68,543 | 43,956 |
Withholding taxes | (5,035) | (4,841) |
Other | (865) | |
Other | 196 | |
Total deferred tax assets, net | 91,254 | 72,407 |
Less: valuation allowance | (107,822) | (88,603) |
Deferred tax liabilities, net | (16,568) | (16,196) |
Valuation allowance related to capital losses | $ 107,800 | $ 88,600 |
Income Taxes (Rate Reconciliati
Income Taxes (Rate Reconciliation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Tax provision (benefit), at U.S. federal statutory tax rate | $ (47,449) | $ (15,515) | $ 4,402 |
State income tax provision (benefit), net of federal benefit | (440) | (3,463) | 856 |
Effect of stock-based compensation tax shortfall | 3,394 | 717 | (364) |
Effect of limitation on executive compensation | 1,057 | 2,511 | 1,678 |
Effect of permanent items | 447 | 869 | 661 |
Effect of India partnerships | 1,366 | 1,644 | 1,422 |
Change in valuation allowance | 19,219 | 26,974 | 5,660 |
Effect of change in state and foreign income tax rates | 97 | (254) | (1,184) |
Uncertain tax positions | 1,211 | (617) | 158 |
Research and development credits | (11,189) | (10,993) | (5,695) |
Effect of goodwill impairment | 40,282 | 0 | 0 |
Change in India indefinite reinvestment assertion | 3,699 | 4,372 | 0 |
Other | 1,083 | 816 | 73 |
Total | $ 12,777 | $ 7,061 | $ 7,667 |
Income Taxes (NOL) (Details)
Income Taxes (NOL) (Details) $ in Millions | Dec. 31, 2023 USD ($) |
Operating Loss Carryforwards | |
NOL, offset future federal taxable income | $ 27 |
NOL, carried forward indefinitely | 37 |
Federal | |
Operating Loss Carryforwards | |
NOL carryforwards | 64 |
Federal | Research and development | |
Operating Loss Carryforwards | |
Tax credit carryforward | 38 |
State | |
Operating Loss Carryforwards | |
NOL carryforwards | 225 |
State | Research and development | |
Operating Loss Carryforwards | |
Tax credit carryforward | 15 |
Foreign | |
Operating Loss Carryforwards | |
Tax credit carryforward | $ 0.9 |
Income Taxes (Unrecognized Tax
Income Taxes (Unrecognized Tax Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of unrecognized tax benefit | |||
Unrecognized tax benefits balance at beginning of year | $ 13,612 | $ 14,517 | $ 15,132 |
Additions based on tax positions related to the current year | 2,456 | 2,522 | 1,631 |
Additions based on tax positions related to prior years | 58 | ||
Additions (reductions) based on tax positions related to prior years | (296) | (550) | |
Reductions for settlements with taxing authorities related to prior years | 0 | 0 | (394) |
Reductions for lapses of statute of limitations | (839) | (3,131) | (1,302) |
Unrecognized tax benefits balance at end of year | 15,287 | 13,612 | $ 14,517 |
Unrecognized tax benefits that would impact effective tax rate, if recognized | 15,300 | ||
Decrease in unrecognized tax benefits is possible in next twelve months | 1,600 | ||
Potential interest and penalties related to unrecognized tax benefits included in income tax expense (benefit) | (400) | 300 | |
Accrued interest and penalties on unrecognized tax benefits | $ 1,600 | $ 2,000 |
Net Income (Loss) Per Share (Co
Net Income (Loss) Per Share (Computation of Basic and Diluted Net Income (Loss) Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings Per Share, Basic [Abstract] | |||
Net income (loss) attributable to Envestnet, Inc. | $ (238,724) | $ (80,939) | $ 13,296 |
Interest and gain on settlement of Convertible Notes due 2025, net of interest and tax | 0 | (9,524) | 0 |
Net income (loss) attributable to Envestnet, Inc. - Diluted | $ (238,724) | $ (90,463) | $ 13,296 |
Weighted-average common shares outstanding: | |||
Basic (in shares) | 54,457,365 | 55,199,482 | 54,470,975 |
Effect of dilutive shares: | |||
Convertible notes (in shares) | 0 | 1,642,643 | 0 |
Warrants (in shares) | 0 | 0 | 73,715 |
Diluted (in shares) | 54,457,365 | 56,842,125 | 55,384,096 |
Net income (loss) attributable to Envestnet, Inc., per share: | |||
Basic (in dollars per share) | $ (4.38) | $ (1.47) | $ 0.24 |
Diluted (in dollars per share) | $ (4.38) | $ (1.59) | $ 0.24 |
Stock Option | |||
Effect of dilutive shares: | |||
Options to purchase common stock and unvested restricted stock units (in shares) | 0 | 0 | 206,022 |
Restricted Stock Units | |||
Effect of dilutive shares: | |||
Options to purchase common stock and unvested restricted stock units (in shares) | 0 | 0 | 633,384 |
Net Income (Loss) Per Share (An
Net Income (Loss) Per Share (Antidilutive Securities) (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Common share equivalents for securities that were anti-dilutive and therefore excluded from the computation of diluted earnings per share | |||
Anti-dilutive securities excluded from computation of diluted earnings per share (in shares) | 12,958,890 | 13,689,206 | 9,898,549 |
Convertible Notes | |||
Common share equivalents for securities that were anti-dilutive and therefore excluded from the computation of diluted earnings per share | |||
Anti-dilutive securities excluded from computation of diluted earnings per share (in shares) | 11,084,413 | 11,470,646 | 9,898,549 |
Convertible Notes | Convertible Notes due 2027 | |||
Common share equivalents for securities that were anti-dilutive and therefore excluded from the computation of diluted earnings per share | |||
Antidilutive securities period increase (decrease) (in shares) | (7,837,480) | ||
Convertible Notes | Convertible Notes due 2023 | |||
Common share equivalents for securities that were anti-dilutive and therefore excluded from the computation of diluted earnings per share | |||
Antidilutive securities period increase (decrease) (in shares) | (4,391,743) | (386,233) | |
Convertible Notes | Convertible Notes due 2025 | |||
Common share equivalents for securities that were anti-dilutive and therefore excluded from the computation of diluted earnings per share | |||
Antidilutive securities period increase (decrease) (in shares) | (1,873,640) | ||
Non-vested RSU's and PSU's | |||
Common share equivalents for securities that were anti-dilutive and therefore excluded from the computation of diluted earnings per share | |||
Anti-dilutive securities excluded from computation of diluted earnings per share (in shares) | 1,672,311 | 1,941,025 | 0 |
Options to purchase common stock | |||
Common share equivalents for securities that were anti-dilutive and therefore excluded from the computation of diluted earnings per share | |||
Anti-dilutive securities excluded from computation of diluted earnings per share (in shares) | 202,166 | 277,535 | 0 |
Segment Information (Narratives
Segment Information (Narratives) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of segments | segment | 2 | ||
Total Assets | $ 1,877,252 | $ 2,112,165 | |
Depreciation and amortization | 130,304 | 125,828 | $ 117,767 |
Payments to Acquire Productive Assets | 113,302 | 105,325 | 88,901 |
Envestnet Wealth Solutions | |||
Segment Reporting Information [Line Items] | |||
Total Assets | 1,562,600 | 1,560,923 | |
Depreciation and amortization | 103,301 | 98,600 | 91,024 |
Payments to Acquire Productive Assets | 95,777 | 82,442 | 66,709 |
Envestnet Data & Analytics | |||
Segment Reporting Information [Line Items] | |||
Total Assets | 314,652 | 551,242 | |
Depreciation and amortization | 27,003 | 27,228 | 26,743 |
Payments to Acquire Productive Assets | $ 17,525 | $ 22,883 | $ 22,192 |
Segment Information (Reconcilia
Segment Information (Reconciliation From Income (Loss) From Operations By Segment) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Income (loss) from operations | $ (204,481) | $ (66,024) | $ 40,541 |
Nonsegment operating expenses | (1,450,101) | (1,305,808) | (1,145,976) |
Total other income (expense), net | (28,516) | (12,395) | (20,180) |
Income (loss) before income tax provision | (232,997) | (78,419) | 20,361 |
Income tax provision | 12,777 | 7,061 | 7,667 |
Net income (loss) | (245,774) | (85,480) | 12,694 |
Add: Net loss attributable to non-controlling interest | 7,050 | 4,541 | 602 |
Net income (loss) attributable to Envestnet, Inc. | (238,724) | (80,939) | 13,296 |
Operating Segments | Envestnet Wealth Solutions | |||
Segment Reporting Information [Line Items] | |||
Income (loss) from operations | 108,753 | 57,323 | 129,287 |
Operating Segments | Envestnet Data & Analytics | |||
Segment Reporting Information [Line Items] | |||
Income (loss) from operations | (216,542) | (22,221) | (2,603) |
Nonsegment | |||
Segment Reporting Information [Line Items] | |||
Nonsegment operating expenses | $ (96,692) | $ (101,126) | $ (86,143) |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 12 Months Ended | ||
Jan. 30, 2023 claim | Jul. 19, 2021 claim | Dec. 31, 2023 USD ($) previousClaim | |
Other Commitments [Line Items] | |||
Number of previous claims experienced | previousClaim | 0 | ||
Purchase obligations | $ 150 | ||
Future funding commitment | $ 8.8 | ||
Case No. 3:20-cv-05991-SK | |||
Other Commitments [Line Items] | |||
Claims dismissed | claim | 1 | 2 |