Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2020 | Jul. 31, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2020 | |
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 | 35 East Wacker Drive | |
Entity Address, Address Line Two | Suite 2400 | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60601 | |
City Area Code | 312 | |
Local Phone Number | 827-2800 | |
Title of 12(b) Security | Common Stock, par value $0.005 per share | |
Trading Symbol | ENV | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 53,772,483 | |
Entity Central Index Key | 0001337619 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 92,244 | $ 82,505 |
Fees receivable, net | 74,871 | 67,815 |
Prepaid expenses and other current assets | 38,665 | 32,183 |
Total current assets | 205,780 | 182,503 |
Property and equipment, net | 49,752 | 53,756 |
Internally developed software, net | 78,024 | 60,263 |
Intangible assets, net | 471,091 | 505,589 |
Goodwill | 906,499 | 879,850 |
Operating lease right-of-use assets, net | 73,537 | 82,796 |
Other non-current assets | 46,722 | 37,127 |
Total assets | 1,831,405 | 1,801,884 |
Current liabilities: | ||
Accrued expenses and other liabilities | 134,763 | 137,944 |
Accounts payable | 16,132 | 17,277 |
Operating lease liabilities | 13,926 | 13,816 |
Contingent consideration | 1,603 | 0 |
Deferred revenue | 42,861 | 34,753 |
Total current liabilities | 209,285 | 203,790 |
Convertible Notes due 2023 | 311,031 | 305,513 |
Revolving credit facility | 275,000 | 260,000 |
Contingent consideration | 11,422 | 9,045 |
Deferred revenue | 5,231 | 5,754 |
Non-current operating lease liabilities | 81,600 | 88,365 |
Deferred tax liabilities, net | 27,106 | 29,481 |
Other non-current liabilities | 36,993 | 32,360 |
Total liabilities | 957,668 | 934,308 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, par value $0.005, 50,000,000 shares authorized | 0 | 0 |
Common stock, par value $0.005, 500,000,000 shares authorized; 67,396,243 and 66,320,706 shares issued as of June 30, 2020 and December 31, 2019, respectively; 53,743,382 and 52,841,706 shares outstanding as of June 30, 2020 and December 31, 2019, respectively | 337 | 331 |
Additional paid-in capital | 1,071,502 | 1,037,141 |
Accumulated deficit | (89,065) | (75,664) |
Treasury stock at cost, 13,652,861 and 13,479,000 shares as of June 30, 2020 and December 31, 2019, respectively | (103,781) | (90,965) |
Accumulated other comprehensive loss | (3,198) | (1,749) |
Total stockholders’ equity | 875,795 | 869,094 |
Non-controlling interest | (2,058) | (1,518) |
Total equity | 873,737 | 867,576 |
Total liabilities and equity | $ 1,831,405 | $ 1,801,884 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2020 | Dec. 31, 2019 |
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 |
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) | 67,396,243 | 66,320,706 |
Common stock, shares outstanding (in shares) | 53,743,382 | 52,841,706 |
Treasury stock (in shares) | 13,652,861 | 13,479,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenues: | ||||
Total revenues | $ 235,313 | $ 224,445 | $ 481,852 | $ 424,111 |
Operating expenses: | ||||
Cost of revenues | 68,849 | 72,080 | 143,782 | 133,725 |
Compensation and benefits | 95,565 | 103,286 | 205,995 | 190,003 |
General and administration | 38,448 | 42,421 | 79,558 | 82,945 |
Depreciation and amortization | 28,443 | 26,915 | 56,126 | 46,432 |
Total operating expenses | 231,305 | 244,702 | 485,461 | 453,105 |
Income (loss) from operations | 4,008 | (20,257) | (3,609) | (28,994) |
Other expense, net | (8,173) | (7,512) | (9,710) | (13,275) |
Loss before income tax provision (benefit) | (4,165) | (27,769) | (13,319) | (42,269) |
Income tax provision (benefit) | 1,306 | (28,382) | (658) | (24,614) |
Net income (loss) | (5,471) | 613 | (12,661) | (17,655) |
Add: Net loss attributable to non-controlling interest | 547 | 280 | 401 | 363 |
Net income (loss) attributable to Envestnet, Inc. | $ (4,924) | $ 893 | $ (12,260) | $ (17,292) |
Net income (loss) per share attributable to Envestnet, Inc.: | ||||
Basic (in dollars per share) | $ (0.09) | $ 0.02 | $ (0.23) | $ (0.35) |
Diluted (in dollars per share) | $ (0.09) | $ 0.02 | $ (0.23) | $ (0.35) |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 53,562,850 | 50,870,296 | 53,288,741 | 49,526,774 |
Diluted (in shares) | 53,562,850 | 52,982,688 | 53,288,741 | 49,526,774 |
Total recurring revenues | ||||
Revenues: | ||||
Total revenues | $ 227,225 | $ 212,328 | $ 466,587 | $ 404,349 |
Asset-based | ||||
Revenues: | ||||
Total revenues | 122,246 | 120,070 | 257,057 | 229,004 |
Operating expenses: | ||||
Cost of revenues | 61,875 | 60,293 | 130,467 | 114,135 |
Subscription-based | ||||
Revenues: | ||||
Total revenues | 104,979 | 92,258 | 209,530 | 175,345 |
Operating expenses: | ||||
Cost of revenues | 6,807 | 6,697 | 13,084 | 14,374 |
Professional services and other revenues | ||||
Revenues: | ||||
Total revenues | 8,088 | 12,117 | 15,265 | 19,762 |
Operating expenses: | ||||
Cost of revenues | $ 167 | $ 5,090 | $ 231 | $ 5,216 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) attributable to Envestnet, Inc. | $ (4,924) | $ 893 | $ (12,260) | $ (17,292) |
Foreign currency translation gains (losses), net of taxes | 1,575 | 112 | (1,449) | 334 |
Comprehensive income (loss) attributable to Envestnet, Inc. | $ (3,349) | $ 1,005 | $ (13,709) | $ (16,958) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Accumulated DeficitCumulative Effect, Period of Adoption, Adjustment | Non-controlling Interest |
Balance at period start (in shares) at Dec. 31, 2018 | 61,238,898 | 13,117,098 | |||||||
Balance, at period start at Dec. 31, 2018 | $ 632,602 | $ 306 | $ (67,858) | $ 761,128 | $ (994) | $ (58,882) | $ (1,098) | ||
Increase (decrease) in shareholders' equity | |||||||||
Exercise of stock options (in shares) | 200,326 | ||||||||
Exercise of stock options | 3,163 | $ 1 | 3,162 | ||||||
Issuance of common stock - vesting of restricted stock units (in shares) | 479,479 | ||||||||
Issuance of common stock - vesting of restricted stock units | 2 | $ 2 | |||||||
Acquisition of business (in shares) | 15,755 | ||||||||
Acquisition of business | 772 | 772 | |||||||
Stock-based compensation expense | 12,864 | 12,864 | |||||||
Purchase of treasury stock for stock-based tax withholdings (in shares) | (160,456) | ||||||||
Purchase of treasury stock for stock-based tax withholdings | (9,819) | $ (9,819) | |||||||
Foreign currency translation gain (loss) | 222 | 222 | |||||||
Net income (loss) | (18,268) | (18,185) | (83) | ||||||
Balance at period end (in shares) at Mar. 31, 2019 | 61,934,458 | 13,277,554 | |||||||
Balance, at period end at Mar. 31, 2019 | 621,538 | $ 309 | $ (77,677) | 777,926 | (772) | (77,067) | (1,181) | ||
Balance at period start (in shares) at Dec. 31, 2018 | 61,238,898 | 13,117,098 | |||||||
Balance, at period start at Dec. 31, 2018 | 632,602 | $ 306 | $ (67,858) | 761,128 | (994) | (58,882) | (1,098) | ||
Increase (decrease) in shareholders' equity | |||||||||
Transfer of non-controlling units | 0 | ||||||||
Foreign currency translation gain (loss) | 334 | ||||||||
Net income (loss) | (17,655) | ||||||||
Balance at period end (in shares) at Jun. 30, 2019 | 65,415,670 | 13,345,514 | |||||||
Balance, at period end at Jun. 30, 2019 | 853,790 | $ 327 | $ (83,820) | 1,015,578 | (660) | (76,174) | (1,461) | ||
Balance at period start (in shares) at Dec. 31, 2018 | 61,238,898 | 13,117,098 | |||||||
Balance, at period start at Dec. 31, 2018 | 632,602 | $ 306 | $ (67,858) | 761,128 | (994) | (58,882) | (1,098) | ||
Balance at period end (in shares) at Dec. 31, 2019 | 66,320,706 | 13,479,000 | |||||||
Balance, at period end at Dec. 31, 2019 | $ 867,576 | $ (1,141) | $ 331 | $ (90,965) | 1,037,141 | (1,749) | (75,664) | $ (1,141) | (1,518) |
Increase (decrease) in shareholders' equity | |||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | ||||||||
Balance at period start (in shares) at Mar. 31, 2019 | 61,934,458 | 13,277,554 | |||||||
Balance, at period start at Mar. 31, 2019 | $ 621,538 | $ 309 | $ (77,677) | 777,926 | (772) | (77,067) | (1,181) | ||
Increase (decrease) in shareholders' equity | |||||||||
Exercise of stock options (in shares) | 114,109 | ||||||||
Exercise of stock options | 1,751 | $ 1 | 1,750 | ||||||
Issuance of common stock - vesting of restricted stock units (in shares) | 182,390 | ||||||||
Issuance of common stock - vesting of restricted stock units | 1 | $ 1 | |||||||
Acquisition of business (in shares) | 3,184,713 | ||||||||
Acquisition of business | 222,484 | $ 16 | 222,468 | ||||||
Stock-based compensation expense | 13,434 | 13,434 | |||||||
Purchase of treasury stock for stock-based tax withholdings (in shares) | (67,960) | ||||||||
Purchase of treasury stock for stock-based tax withholdings | (6,143) | $ (6,143) | |||||||
Foreign currency translation gain (loss) | 112 | 112 | |||||||
Net income (loss) | 613 | 893 | (280) | ||||||
Balance at period end (in shares) at Jun. 30, 2019 | 65,415,670 | 13,345,514 | |||||||
Balance, at period end at Jun. 30, 2019 | 853,790 | $ 327 | $ (83,820) | 1,015,578 | (660) | (76,174) | (1,461) | ||
Balance at period start (in shares) at Dec. 31, 2019 | 66,320,706 | 13,479,000 | |||||||
Balance, at period start at Dec. 31, 2019 | 867,576 | (1,141) | $ 331 | $ (90,965) | 1,037,141 | (1,749) | (75,664) | (1,141) | (1,518) |
Increase (decrease) in shareholders' equity | |||||||||
Exercise of stock options (in shares) | 357,974 | ||||||||
Exercise of stock options | 3,408 | $ 2 | 3,406 | ||||||
Issuance of common stock - vesting of restricted stock units (in shares) | 398,881 | ||||||||
Issuance of common stock - vesting of restricted stock units | 2 | $ 2 | |||||||
Stock-based compensation expense | 13,765 | 13,765 | |||||||
Purchase of treasury stock for stock-based tax withholdings (in shares) | (130,164) | ||||||||
Purchase of treasury stock for stock-based tax withholdings | (9,199) | $ (9,199) | |||||||
Foreign currency translation gain (loss) | (3,024) | (3,024) | |||||||
Net income (loss) | (7,190) | (7,336) | 146 | ||||||
Balance at period end (in shares) at Mar. 31, 2020 | 67,077,561 | 13,609,164 | |||||||
Balance, at period end at Mar. 31, 2020 | 864,197 | $ 335 | $ (100,164) | 1,054,312 | (4,773) | (84,141) | (1,372) | ||
Balance at period start (in shares) at Dec. 31, 2019 | 66,320,706 | 13,479,000 | |||||||
Balance, at period start at Dec. 31, 2019 | $ 867,576 | $ (1,141) | $ 331 | $ (90,965) | 1,037,141 | (1,749) | (75,664) | $ (1,141) | (1,518) |
Increase (decrease) in shareholders' equity | |||||||||
Exercise of stock options (in shares) | 542,449 | ||||||||
Transfer of non-controlling units | $ 771 | ||||||||
Foreign currency translation gain (loss) | (1,449) | ||||||||
Net income (loss) | (12,661) | ||||||||
Balance at period end (in shares) at Jun. 30, 2020 | 67,396,243 | 13,652,861 | |||||||
Balance, at period end at Jun. 30, 2020 | $ 873,737 | $ 337 | $ (103,781) | 1,071,502 | (3,198) | (89,065) | (2,058) | ||
Increase (decrease) in shareholders' equity | |||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | ||||||||
Balance at period start (in shares) at Mar. 31, 2020 | 67,077,561 | 13,609,164 | |||||||
Balance, at period start at Mar. 31, 2020 | $ 864,197 | $ 335 | $ (100,164) | 1,054,312 | (4,773) | (84,141) | (1,372) | ||
Increase (decrease) in shareholders' equity | |||||||||
Exercise of stock options (in shares) | 184,475 | ||||||||
Exercise of stock options | 3,275 | $ 1 | 3,274 | ||||||
Issuance of common stock - vesting of restricted stock units (in shares) | 134,207 | ||||||||
Issuance of common stock - vesting of restricted stock units | 1 | $ 1 | |||||||
Stock-based compensation expense | 13,006 | 13,006 | |||||||
Purchase of treasury stock for stock-based tax withholdings (in shares) | (43,697) | ||||||||
Purchase of treasury stock for stock-based tax withholdings | (3,617) | $ (3,617) | |||||||
Transfer of non-controlling units | 771 | 910 | (139) | ||||||
Foreign currency translation gain (loss) | 1,575 | 1,575 | |||||||
Net income (loss) | (5,471) | (4,924) | (547) | ||||||
Balance at period end (in shares) at Jun. 30, 2020 | 67,396,243 | 13,652,861 | |||||||
Balance, at period end at Jun. 30, 2020 | $ 873,737 | $ 337 | $ (103,781) | $ 1,071,502 | $ (3,198) | $ (89,065) | $ (2,058) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Jun. 30, 2019 | |
OPERATING ACTIVITIES: | ||
Net loss | $ (12,661) | $ (17,655) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 56,126 | 46,432 |
Provision for doubtful accounts | 1,515 | 713 |
Deferred income taxes | (1,598) | (28,991) |
Non-cash compensation expense | 29,869 | 27,852 |
Non-cash interest expense | 5,907 | 9,896 |
Accretion on contingent consideration and purchase liability | 910 | 742 |
Payments of contingent consideration | 0 | (578) |
Fair market value adjustment to contingent consideration liability | (1,982) | 0 |
Gain on acquisition of equity method investment | (4,230) | 0 |
Loss allocation from equity method investments | 3,286 | 550 |
Impairment of right of use assets | 1,426 | 0 |
Other | 556 | 0 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Fees receivable, net | (8,560) | (536) |
Prepaid expenses and other current assets | (7,756) | (15,507) |
Other non-current assets | (353) | (3,241) |
Accrued expenses and other liabilities | (4,484) | (19,060) |
Accounts payable | (2,130) | (4,768) |
Deferred revenue | 7,236 | 3,940 |
Other non-current liabilities | 1,946 | 2,602 |
Net cash provided by operating activities | 65,023 | 2,391 |
INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (4,329) | (8,815) |
Capitalization of internally developed software | (25,703) | (15,583) |
Investments in private companies | (12,625) | (2,000) |
Acquisitions of businesses, net of cash acquired | (20,257) | (321,571) |
Net cash used in investing activities | (62,914) | (347,969) |
FINANCING ACTIVITIES: | ||
Proceeds from borrowings on revolving credit facility | 45,000 | 175,000 |
Payments on revolving credit facility | (30,000) | (30,000) |
Payments of contingent consideration | 0 | (171) |
Proceeds from exercise of stock options | 6,683 | 4,914 |
Purchase of treasury stock for stock-based tax withholdings | (12,816) | (15,962) |
Issuance of restricted stock units | 3 | 3 |
Net cash provided by financing activities | 8,870 | 133,784 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (1,342) | 166 |
INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 9,637 | (211,628) |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD | 82,755 | 289,671 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (See Note 2) | 92,392 | 78,043 |
Supplemental disclosure of cash flow information - net cash paid during the period for income taxes | 2,136 | 6,121 |
Supplemental disclosure of cash flow information - cash paid during the period for interest | 7,861 | 5,952 |
Supplemental disclosure of non-cash operating, investing and financing activities: | ||
Common stock issued in acquisition of business | 0 | 222,484 |
Contingent consideration issued in acquisition of businesses | 5,239 | 15,880 |
Purchase liabilities included in other non-current liabilities | 0 | 5,468 |
Purchase liabilities included in accrued expenses and other liabilities | 632 | 0 |
Purchase of fixed assets included in accounts payable and accrued expenses and other liabilities | 1,139 | 1,567 |
Membership interest liabilities included in other non-current liabilities | 3,098 | 1,480 |
Common stock issued to settle purchase liability | 0 | 772 |
Leasehold improvements funded by lease incentive | 1,710 | 648 |
Transfer of non-controlling units | $ 771 | $ 0 |
Organization and Description of
Organization and Description of Business | 6 Months Ended |
Jun. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of BusinessEnvestnet, Inc. (“Envestnet”) and its subsidiaries (collectively, the “Company”) provide intelligent systems for wealth management and financial wellness. Envestnet’s unified technology enhances advisor productivity and strengthens the wealth management process. Through a combination of platform enhancements, partnerships and acquisitions, Envestnet empowers enterprises and advisors to more fully understand their clients and deliver better outcomes.Envestnet is organized around two primary, complementary business segments. Financial information about each business segment is contained in “Note 15—Segment Information” to the condensed consolidated financial statements. |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company as of June 30, 2020 and for the three and six months ended June 30, 2020 and 2019 have not been audited by an independent registered public accounting firm. These unaudited condensed consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements for the year ended December 31, 2019 and reflect all normal recurring adjustments which are, in the opinion of management, necessary to present fairly the Company’s financial position as of June 30, 2020 and the results of operations, equity, comprehensive loss and cash flows for the periods presented herein. The unaudited condensed consolidated financial statements include the accounts of the Company. All significant intercompany transactions and balances have been eliminated in consolidation. Accounts for the Envestnet Wealth Solutions segment that are denominated in a non-U.S. currency have been re-measured 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 revenues and expenses are translated at average exchange rates. Differences arising from these foreign currency translations are recorded in the unaudited condensed 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 expense, net in the condensed consolidated statements of operations. The results of operations for the three and six months ended June 30, 2020 are not necessarily indicative of the operating results to be expected for other interim periods or for the full fiscal year. The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. References to GAAP in these notes are to the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification ™ , sometimes referred to as the codification or “ASC.” These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on February 28, 2020. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Actual results could differ from these estimates. The following table reconciles cash, cash equivalents and restricted cash from the condensed consolidated balance sheets to amounts reported within the condensed consolidated statements of cash flows: June 30, June 30, 2020 2019 Cash and cash equivalents $ 92,244 $ 77,717 Restricted cash included in prepaid expenses and other current assets — 158 Restricted cash included in other non-current assets 148 168 Total cash, cash equivalents and restricted cash $ 92,392 $ 78,043 Financial Impacts Related To COVID-19 On March 11, 2020, the World Health Organization declared the outbreak of COVID-19, a novel strain of Coronavirus, a global pandemic. This outbreak is causing major disruptions to businesses and markets worldwide as the virus spreads. The extent of the effect on the Company’s operational and financial performance will depend on future developments, including the duration, spread and intensity of the pandemic, and governmental, regulatory and private sector responses, all of which are uncertain and difficult to predict. Although the Company is unable to estimate the overall financial effect of the pandemic at this time, if the pandemic continues, it could have a material adverse effect on the Company’s business, results of operations, financial condition and cash flows. As of June 30, 2020, these condensed consolidated financial statements do not reflect any adjustments as a result of the pandemic. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements —In June 2016, the FASB issued ASU 2016-13 These changes became effective for the Company 's fiscal year beginning January 1, 2020. The Company recognized the cumulative effect of the initial application of ASU 2016-13 as an adjustment of $1,141, net of tax, to the opening balance of accumulated deficit. The Company does not expect the adoption of ASU 2016-13 to have a material impact to the results of its operations on an ongoing basis. Not Yet Adopted Accounting Pronouncements —In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes .” This update aims to reduce complexity within the accounting for income taxes as part of the simplification initiative |
Acquisitions and Other Investme
Acquisitions and Other Investments | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Acquisitions and Other Investments | Acquisitions and Other Investments Investment in Private Services Company On January 8, 2020, the Company acquired a 4.25% membership interest in a private services company for cash consideration of $11,000. The private services company partners with independent network advisory firms to help them grow, become more profitable and run more efficiently. The Company will use the equity method of accounting to record its portion of the private services 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 and lack of control and does not otherwise exercise control over the significant economic decisions of the private services company. The private services company is and remains a client of the Company and has thus been determined to be a related party. Revenues from the private services company totaled $2,384 and $5,073 in the three and six months ended June 30, 2020. As of June 30, 2020, the Company had recorded a net receivable of $1,468 from the private services company. Acquisition of Private Technology Company On February 18, 2020, the Company, through it's wholly owned subsidiary Yodlee, Inc. (“Yodlee”), acquired a private technology company (the “Private Technology Company Acquisition”). The private technology company enables the consent generation and data flow between financial information providers, such as banks and financial institutions, and financial information users, such as financial technology lenders and other financial services agencies, through a network of cloud-based interoperable interfaces or application programming interfaces. The technology and operations of the private technology company have been integrated into the Envestnet Data & Analytics segment. In connection with the Private Technology Company Acquisition, the Company acquired all of the outstanding shares and paid cash consideration of $2,343, net of cash acquired, subject to certain closing and post-closing adjustments, plus up to an additional $6,750 in contingent consideration, based upon achieving certain performance targets. The Company recorded a liability as of the date of acquisition of $5,239, which represented the estimated fair value of contingent consideration on the date of acquisition. In June 2020, the Company determined that certain performance targets for this acquisition would not be met. As a result, the Company reduced the contingent consideration liability plus accrued interest associated with this acquisition by $1,982 and recorded this as a reduction to general and administration expenses. Future changes to the estimated fair value of the contingent consideration, if any, will be recognized in earnings of the Company. The Company recorded estimated goodwill of $7,017, which is not deductible for income tax purposes, and estimated identifiable intangible assets for proprietary technologies of $1,000. The tangible assets acquired and liabilities assumed were not material. The results of the private technology company's operations are included in the condensed consolidated statements of operations beginning February 18, 2020 and were not considered material to the Company’s results of operations. Acquisition of Private Cloud Technology Company On March 2, 2020, the Company acquired certain assets of a private cloud technology company (the “Private Cloud Technology Company Acquisition”). The private cloud technology company enables enterprises to design and implement the digital transition from legacy systems and applications to a modern cloud computing platform. The technology and operations of the private cloud technology company have been integrated into our Envestnet Wealth Solutions segment. In connection with the Private Cloud Technology Company Acquisition, the Company paid estimated consideration of $11,968, net of cash acquired. In connection with the acquisition, the Company recorded estimated goodwill of $10,932, which is deductible for income tax purposes. The tangible assets acquired and liabilities assumed were not material. The results of the private cloud technology company's operations are included in the condensed consolidated statements of operations beginning March 2, 2020 and were not considered material to the Company’s results of operations. Acquisition of Private Financial Technology Design Company On March 3, 2020, the Company acquired the outstanding units of a private financial technology design company that were not owned by the Company and merged the acquired company into a wholly owned subsidiary of the Company (the “Private Financial Technology Design Company Acquisition”). The private financial technology design company designs integrated, intuitive digital technology applications for institutional financial services firms, bank wealth management organizations, independent advisor networks, and broker-dealers. The technology and operations of the private financial technology design company have been integrated into the Envestnet Wealth Solutions segment. The Company previously owned approximately 45% of the outstanding units in this private financial technology design company, and accounted for it as an equity method investment. Based upon the estimated value of the private financial technology design company of $11,026, the Company paid estimated consideration of $5,946, net of cash acquired, for the remaining outstanding units. As a result of the acquisition, the Company recognized a gain of $4,230 in the first quarter of 2020 on the re-measurement to fair value of its previously held interest, which is included in other expense, net in the condensed consolidated statements of operations In connection with the Private Financial Technology Design Company Acquisition, the Company recorded estimated total goodwill of $9,241, of which approximately $1,800 is deductible for income tax purposes, and estimated identifiable intangible assets for proprietary technologies of $2,000. The tangible assets acquired and liabilities assumed were not material. The results of the private financial technology design company's operations are included in the condensed consolidated statements of operations beginning March 3, 2020 and were not considered material to the Company’s results of operations. For the three and six months ended June 30, 2020, acquisition related costs for the Company's 2020 acquisitions were not material, and are included in general and administration expenses. The Company may incur additional acquisition related costs over the remainder of 2020. The goodwill arising from these acquisitions represents the expected synergistic benefits of these transactions, primarily related to an increase in future revenues as a result of potential new business and cross selling opportunities, as well as enhancements to our existing technologies. For the Company's 2020 acquisitions, the estimated fair values of certain of the assets and liabilities acquired are provisional and based on the information that was available to the Company as of the acquisition date. The estimated fair values of these provisional items are based on certain valuation and other studies and are in progress and not yet at the point where there is sufficient information for a definitive measurement. The Company believes the preliminary information provides a reasonable basis for estimating the fair values of these amounts, but is waiting for additional information necessary to finalize those fair values. Therefore, provisional measurements of fair values reflected are subject to change and such changes could be significant. The Company expects to finalize the valuation of these estimated assets and liabilities as soon as reasonably practicable but no later than one year from the acquisition date. Pro Forma Financial Information On April 1, 2019, the Company acquired certain of the assets, primarily consisting of intangible assets, and the assumption of certain liabilities of the PortfolioCenter business (“PortfolioCenter”) from Performance Technologies, Inc., a wholly-owned subsidiary of The Charles Schwab Corporation. On May 1, 2019, the Company acquired all of the outstanding shares of capital stock of PIEtech, Inc. (“PIEtech”). The following pro forma financial information presents the combined results of operations of Envestnet, PortfolioCenter and PIEtech for the three and six months ended June 30, 2019 and assumes the acquisitions of PortfolioCenter and PIEtech had occurred as of the beginning of 2018. The results of the Company's other acquisitions since January 1, 2019 are not included in the pro forma financial information presented below as they were not considered material to the Company's results of operations. The unaudited pro forma results presented below include amortization charges for acquired intangible assets, interest expense, stock-based compensation expense and income tax. The Company's pro forma information below includes the reversal of a valuation allowance on its deferred tax assets as of January 1, 2018 and the reversal of transaction costs that were incurred in 2019 as a result of these acquisitions and reverses these amounts from the appropriate periods in 2019. All intercompany revenues have been eliminated within this pro forma information. Pro forma financial information is presented for informational purposes and is not indicative of the results of operations that would have been achieved if the acquisitions had taken place as of the beginning of 2018. Three Months Ended June 30, Six Months Ended June 30, 2019 2019 Revenues $ 228,522 $ 443,275 Net loss attributable to Envestnet, Inc. $ (7,612) $ (18,857) Net loss per share attributable to Envestnet, Inc.: Basic $ (0.15) $ (0.37) Diluted $ (0.15) $ (0.37) |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 6 Months Ended |
Jun. 30, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: June 30, December 31, 2020 2019 Prepaid technology $ 9,611 $ 8,178 Non-income tax receivables 5,851 5,555 Advance payroll taxes and benefits 4,922 5,446 Income tax receivables 3,124 — Prepaid outside information services 2,553 2,209 Prepaid insurance 1,976 1,919 Other 10,628 8,876 Total prepaid expenses and other current assets $ 38,665 $ 32,183 |
Property and Equipment, Net
Property and Equipment, Net | 6 Months Ended |
Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net consists of the following: June 30, December 31, Estimated Useful Life 2020 2019 Cost: Computer equipment and software 3 years $ 71,090 $ 72,190 Leasehold improvements Shorter of the lease term or useful life of the asset 37,271 34,645 Office furniture and fixtures 3-7 years 10,668 10,832 Office equipment and other 3-5 years 6,925 6,850 Building and building improvements 7-39 years 2,669 2,647 Land Not applicable 940 940 129,563 128,104 Less: accumulated depreciation and amortization (79,811) (74,348) Total property and equipment, net $ 49,752 $ 53,756 During the three and six months ended June 30, 2020, the Company retired property and equipment that was no longer in service for the Envestnet Wealth Solutions segment with an historical cost of $2,903 and $4,495, respectively. During the three and six months ended June 30, 2020, the Company retired property and equipment that was no longer in service for the Envestnet Data & Analytics segment with an historical cost of $117 and $684, respectively. During the three and six months ended June 30, 2019, the Company retired property and equipment that was no longer in service for the Envestnet Wealth Solutions segment with an historical cost of $2,396 and $3,642, respectively. During the three and six months ended June 30, 2019, the Company retired property and equipment that was no longer in service for the Envestnet Data & Analytics segment with an historical cost of $1,640 and $4,121, respectively. Gains and losses on asset retirements during the three and six months ended June 30, 2020 and 2019 were not material. Depreciation and amortization expense was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Depreciation and amortization expense $ 5,363 $ 6,751 $ 10,680 $ 11,117 |
Internally Developed Software
Internally Developed Software | 6 Months Ended |
Jun. 30, 2020 | |
Research and Development [Abstract] | |
Internally Developed Software | Internally Developed Software Internally developed software consists of the following: June 30, December 31, Estimated Useful Life 2020 2019 Internally developed software 5 years $ 130,406 $ 104,703 Less: accumulated amortization (52,382) (44,440) Internally developed software, net $ 78,024 $ 60,263 Amortization expense was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Amortization expense $ 4,334 $ 3,110 $ 7,942 $ 5,733 |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net Changes in the carrying amount of goodwill were as follows: Envestnet Wealth Solutions Envestnet Data & Analytics Total Balance at December 31, 2019 $ 583,247 $ 296,603 $ 879,850 Acquisitions 20,173 7,017 27,190 Foreign currency and other (70) (471) (541) Balance at June 30, 2020 $ 603,350 $ 303,149 $ 906,499 Intangible assets, net consist of the following: June 30, 2020 December 31, 2019 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Customer lists $ 591,520 $ (173,895) $ 417,625 $ 591,520 $ (148,517) $ 443,003 Proprietary technologies 90,714 (53,822) 36,892 87,714 (44,165) 43,549 Trade names 33,700 (17,126) 16,574 33,700 (14,663) 19,037 Total intangible assets $ 715,934 $ (244,843) $ 471,091 $ 712,934 $ (207,345) $ 505,589 There were no material retirements of intangible assets during the three and six months ended June 30, 2020 and 2019. Amortization expense was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Amortization expense $ 18,746 $ 17,054 $ 37,504 $ 29,582 |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 6 Months Ended |
Jun. 30, 2020 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Liabilities | Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consisted of the following: June 30, December 31, 2020 2019 Accrued investment manager fees $ 56,061 $ 48,720 Accrued compensation and related taxes 44,231 53,627 Non-income tax payables 10,307 11,040 Accrued professional services 5,321 3,833 Accrued technology 3,521 3,042 Accrued transaction costs 2,761 2,482 Accrued charitable contribution — 5,020 Other accrued expenses 12,561 10,180 Total accrued expenses and other liabilities $ 134,763 $ 137,944 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt The Company’s outstanding debt obligations as of June 30, 2020 and December 31, 2019 were as follows: June 30, December 31, 2020 2019 Revolving credit facility balance $ 275,000 $ 260,000 Convertible Notes due 2023 $ 345,000 $ 345,000 Unaccreted discount on Convertible Notes due 2023 (28,811) (33,491) Unamortized issuance costs on Convertible Notes due 2023 (5,158) (5,996) Convertible Notes due 2023 carrying value (1) $ 311,031 $ 305,513 (1) The effective interest rate on the liability component of the Convertible Notes due 2023 was 6% for the three and six months ended June 30, 2020 and 2019. Interest expense was comprised of the following and is included in other expense, net in the condensed consolidated statement of operations: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Accretion of debt discount $ 2,349 $ 3,784 $ 4,680 $ 7,542 Interest on revolving credit facility 2,009 1,196 4,527 1,196 Coupon interest 1,510 2,264 3,011 4,528 Amortization of issuance costs 633 862 1,264 1,720 Undrawn and other fees 133 157 286 373 Total interest expense $ 6,634 $ 8,263 $ 13,768 $ 15,359 The credit agreement under which the above revolving credit facility was issued (the “Amended Credit Agreement”) includes certain financial covenants and, as of June 30, 2020, the Company was in compliance with these requirements. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis in the condensed consolidated balance sheets as of June 30, 2020 and December 31, 2019, based on the three-tier fair value hierarchy: June 30, 2020 Fair Value Level I Level II Level III Assets: Money market funds $ 47,351 $ 47,351 $ — $ — Assets to fund deferred compensation liability 9,076 — — 9,076 Total assets $ 56,427 $ 47,351 $ — $ 9,076 Liabilities: Contingent consideration $ 13,025 $ — $ — $ 13,025 Deferred compensation liability 7,596 7,596 — — Total liabilities $ 20,621 $ 7,596 $ — $ 13,025 December 31, 2019 Fair Value Level I Level II Level III Assets: Money market funds $ 37,730 $ 37,730 $ — $ — Assets to fund deferred compensation liability 8,390 — — 8,390 Total assets $ 46,120 $ 37,730 $ — $ 8,390 Liabilities: Contingent consideration $ 9,045 $ — $ — $ 9,045 Deferred compensation liability 8,208 8,208 — — Total liabilities $ 17,253 $ 8,208 $ — $ 9,045 The fair value of the contingent consideration liabilities related to certain of the Company's acquisitions were estimated using a discounted cash flow method with significant inputs that are not observable in the market and thus represents a Level III fair value measurement as defined in ASC 820, “Fair Value Measurements and Disclosures.” The significant inputs in the Company's Level III fair value measurement not supported by market activity included its assessments of expected future cash flows related to these acquisitions and their ability to meet the target performance objectives during the subsequent periods from the date of acquisition, which management believes are appropriately discounted considering the uncertainties associated with these obligations, and are calculated in accordance with the terms of their respective agreements. The Company will continue to reassess the fair values of the contingent consideration liabilities at each reporting date until settlement. Changes to these estimated fair values will be recognized in the Company's earnings and included in general and administration expenses in the condensed consolidated statements of operations. The table below presents a reconciliation of the Company's contingent consideration liabilities, which were measured at fair value on a recurring basis using significant unobservable inputs (Level III) for the period from December 31, 2019 to June 30, 2020: Fair Value of Contingent Consideration Liabilities Balance at December 31, 2019 $ 9,045 Private technology company acquisition 5,239 Fair market value adjustment on contingent consideration liability (1,982) Accretion on contingent consideration 723 Balance at June 30, 2020 $ 13,025 The table below presents a reconciliation of the assets used to fund deferred the Company's deferred compensation liability, which is measured at fair value on a recurring basis using significant unobservable inputs (Level III) for the period from December 31, 2019 to June 30, 2020: Fair Value of Assets to Fund Deferred Compensation Liability Balance at December 31, 2019 $ 8,390 Contributions 1,060 Fair value adjustments (374) Balance at June 30, 2020 $ 9,076 The fair market value of the assets used to fund the Company 's deferred compensation liability is based upon the cash surrender value of the Company 's life insurance premiums. The value of the assets used to fund the Company's deferred compensation liability, which are included in other non-current assets in the condensed consolidated balance sheets, increased due to funding of the plan, partially offset by losses on the underlying investment vehicles. These losses are recognized in the Company's earnings and included in general and administration expenses in the condensed consolidated statements of operations. 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 caused 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 six months ended June 30, 2020. As of June 30, 2020 and December 31, 2019, the carrying value of the Convertible Notes due 2023 equaled $311,031 and $305,513, respectively, and represented the aggregate principal amount outstanding less the unamortized discount and debt issuance costs. As of June 30, 2020 and December 31, 2019, the estimated fair value of the Convertible Notes due 2023 was $419,430 and $414,852, respectively. The Company considered the Convertible Notes due 2023 to be a Level II liability at June 30, 2020 and used a market approach to calculate the fair value. The estimated fair value was determined based on estimated or actual bids and offers of the Convertible Notes due 2023 in an over-the-counter market on June 30, 2020 (See “Note 9—Debt”). As of June 30, 2020 and December 31, 2019, there was $275,000 and $260,000, respectively, outstanding on the revolving credit facility under the Amended Credit Agreement. As of June 30, 2020, the outstanding balance on the revolving credit facility approximated fair value as borrowings under the revolving credit facility bore interest at variable rates and the Company believes its credit risk quality was consistent with when the debt originated. The Company considered the revolving credit facility to be a Level I liability as of June 30, 2020 and December 31, 2019 (See “Note 9—Debt”). The Company considered the recorded value of our other financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable and accounts payable, to approximate the fair value of the respective assets and liabilities at June 30, 2020 based upon the short-term nature of these assets and liabilities. |
Revenues and Cost of Revenues
Revenues and Cost of Revenues | 6 Months Ended |
Jun. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues and Cost of Revenues | Revenues and Cost of Revenues Disaggregation of Revenue The following table presents the Company’s revenues disaggregated by major source: Three Months Ended June 30, 2020 2019 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Revenues: Asset-based $ 122,246 $ — $ 122,246 $ 120,070 $ — $ 120,070 Subscription-based 61,410 43,569 104,979 50,078 42,180 92,258 Total recurring revenues 183,656 43,569 227,225 170,148 42,180 212,328 Professional services and other revenues 4,029 4,059 8,088 6,742 5,375 12,117 Total revenues $ 187,685 $ 47,628 $ 235,313 $ 176,890 $ 47,555 $ 224,445 Six Months Ended June 30, 2020 2019 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Revenues: Asset-based $ 257,057 $ — $ 257,057 $ 229,004 $ — $ 229,004 Subscription-based 121,733 87,797 209,530 91,104 84,241 175,345 Total recurring revenues 378,790 87,797 466,587 320,108 84,241 404,349 Professional services and other revenues 7,315 7,950 15,265 9,487 10,275 19,762 Total revenues $ 386,105 $ 95,747 $ 481,852 $ 329,595 $ 94,516 $ 424,111 One customer accounted for more than 10% of the Company’s total revenues: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Fidelity 15 % 15 % 15 % 15 % Fidelity accounted for 18% and 18% of the Envestnet Wealth Solutions segment's revenues for the three and six months ended June 30, 2020, respectively. Fidelity accounted for 19% and 20% of the Envestnet Wealth Solutions segment's revenues for the three and six months ended June 30, 2019, respectively. No single customer accounted for over 10% of the Envestnet Data & Analytics segment's revenue for any period presented. The following table presents the Company’s revenues disaggregated by geography, based on the billing address of the customer: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 United States $ 230,102 $ 217,462 $ 470,554 $ 409,581 International (1) 5,211 6,983 11,298 14,530 Total revenues $ 235,313 $ 224,445 $ 481,852 $ 424,111 (1) No foreign country accounted for more than 10% of the Company's total revenues. Remaining Performance Obligations The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of June 30, 2020: Years ending December 31, Remainder of 2020 $ 114,905 2021 181,322 2022 135,410 2023 65,759 2024 35,319 Thereafter 35,393 Total $ 568,108 Only fixed consideration from significant contracts with customers is included in the amounts presented above. The Company has applied the practical expedients and exemption and therefore does not 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 obligations or to a wholly unsatisfied promise to transfer a distinct service that forms part of a single performance obligation. Contract Balances Total deferred revenue as of June 30, 2020 increased by $7,585 during the six months ended June 30, 2020, primarily the result of revenue growth, timing of cash receipts and revenue recognition. The majority of the Company's deferred revenue will be recognized over the course of the next twelve months. The amount of revenue recognized that was included in the opening deferred revenue balance was $10,350 and $6,865 for the three months ended June 30, 2020 and 2019, respectively. The amount of revenue recognized that was included in the opening deferred revenue balance was $25,829 and $16,588 for the six months ended June 30, 2020 and 2019, 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 $10,072 and $9,387 as of June 30, 2020 and December 31, 2019, respectively. Amortization expense for the deferred sales incentive compensation was $1,043 and $753 for the three months ended June 30, 2020, and 2019, respectively. Amortization expense for the deferred sales incentive compensation was $2,072 and $1,404 for the six months ended June 30, 2020, and 2019, respectively. Deferred sales incentive compensation is included in other non-current assets on the condensed consolidated balance sheets and amortization expense is included in compensation and benefits expenses on the condensed consolidated statements of operations. No significant impairment loss for capitalized costs was recorded during the periods. 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 compensation and benefits expenses in the condensed consolidated statements of operations. Cost of Revenues The following table summarizes cost of revenues by revenue category: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Asset-based $ 61,875 $ 60,293 $ 130,467 $ 114,135 Subscription-based 6,807 6,697 13,084 14,374 Professional services and other 167 5,090 231 5,216 Total cost of revenues $ 68,849 $ 72,080 $ 143,782 $ 133,725 |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Company has stock options, restricted stock units (“RSUs”) and performance stock units (“PSUs”) outstanding under the 2004 Stock Incentive Plan (the “2004 Plan”), the 2010 Long-Term Incentive Plan (the “2010 Plan”) and the Envestnet, Inc. 2019 Acquisition Equity Incentive Plan (the “2019 Equity Plan”). As of June 30, 2020, the maximum number of common shares available for future issuance under the Company’s plans is 1,372,807. Stock-based compensation expense under the Company’s plans was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Stock-based compensation expense $ 13,006 $ 13,434 $ 26,771 $ 26,298 Tax effect on stock-based compensation expense (3,317) (3,504) (6,826) (6,859) Net effect on income $ 9,689 $ 9,930 $ 19,945 $ 19,439 The tax effect on stock-based compensation expense above was calculated using a blended statutory rate of 25.5% and 26.1% for the three and six months ended June 30, 2020 and 2019, respectively. Stock Options The following weighted average assumptions were used to value options granted during the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Grant date fair value of options $ — $ — $ — $ 21.55 Volatility — % — % — % 40.0 % Risk-free interest rate — % — % — % 2.5 % Dividend yield — % — % — % — % Expected term (in years) 0.0 0.0 0.0 6.5 The following table summarizes option activity under the Company’s plans: Weighted-Average Weighted- Remaining Average Contractual Life Aggregate Options Exercise Price (Years) Intrinsic Value Outstanding as of December 31, 2019 1,150,586 $ 25.66 3.4 $ 50,590 Granted — — Exercised (542,449) 16.97 Forfeited (7,213) 48.70 Outstanding as of June 30, 2020 600,924 33.23 4.0 24,225 Options exercisable 560,745 $ 32.10 3.7 $ 23,238 Exercise prices of stock options outstanding as of June 30, 2020 range from $9.00 to $55.29. At June 30, 2020, there was $468 of unrecognized stock-based compensation expense related to unvested stock options, which the Company expects to recognize over a weighted-average period of 1.6 years. Restricted Stock Units and Restricted Stock Awards Periodically, the Company grants restricted stock units and awards and performance-based stock units and awards to employees. Performance-based stock units and awards 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 stock units and awards provide thresholds that dictate the number of shares to vest upon each evaluation date, which range from 50% to 150%. 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 unvested restricted stock units and performance stock units granted under the Company’s plans: RSUs PSUs Number of Weighted- Number of Weighted- Outstanding as of December 31, 2019 1,318,870 $ 58.88 254,118 $ 67.96 Granted 951,428 74.52 67,793 81.42 Vested (533,088) 56.77 — — Forfeited (103,133) 59.89 (33,010) 64.70 Outstanding as of June 30, 2020 1,634,077 68.61 288,901 71.49 At June 30, 2020, there was $99,676 of unrecognized stock-based compensation expense related to unvested restricted stock units and awards, which the Company expects to recognize over a weighted-average period of 2.2 years. At June 30, 2020, there was $9,578 of unrecognized stock-based compensation expense related to unvested performance-based restricted stock units and awards, which the Company expects to recognize over a weighted-average period of 2.1 years. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table includes the Company’s loss before income tax provision (benefit), income tax provision (benefit) and effective tax rate: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Loss before income tax provision (benefit) $ (4,165) $ (27,769) $ (13,319) $ (42,269) Income tax provision (benefit) 1,306 (28,382) (658) (24,614) Effective tax rate (31.4) % 102.2 % 4.9 % 58.2 % For the three and six months ended June 30, 2020, the Company’s effective tax rate differed from the statutory rate primarily due to the increase in the valuation allowance the Company has placed on a portion of its US deferred tax assets and the impact of state and local taxes, partially offset by the permanent book tax differences, the windfall from stock-based compensation, impact of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) related to net operating loss carryback, and research and experimentation credits. For the three and six months ended June 30, 2019, the Company's effective tax rate differed from the statutory rate primarily due to the release of the Company's valuation allowance of $21,907 as a result of additional deferred tax liabilities recorded from the PIEtech acquisition, the windfall from stock-based compensation, federal and state research and development credits, and additional accruals for uncertain tax positions. The Company's total gross liability for unrecognized tax benefits, exclusive of interest and penalties, was $20,261 and $18,939 at June 30, 2020 and December 31, 2019, respectively. Of this amount, a portion of the unrecognized tax benefits was recorded as a reduction of deferred tax assets instead of a non-current liability. The portion of the unrecognized tax benefits, exclusive of interest and penalties, recorded as a non-current liability was $6,977 and $6,504 at June 30, 2020 and December 31, 2019, respectively. At June 30, 2020, the amount of unrecognized tax benefits, including interest and penalties, that would benefit the Company's effective tax rate, if recognized, was $14,618. The Company estimates that the liability for unrecognized tax benefits could decrease by $12,000 in the next twelve months as it is anticipated that reviews by tax authorities will be completed. The Company recognizes potential interest and penalties related to unrecognized tax benefits in income tax expense. These amounts were not material for the three and six months ended June 30, 2020 and 2019. The Company had accrued interest and penalties of $8,000 and $7,336 as of June 30, 2020 and December 31, 2019, respectively. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
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 stock options, common warrants, restricted stock awards, restricted stock units and convertible notes using the treasury stock method, if dilutive. The Company accounts for the effect of its convertible notes (See “Note 9—Debt”) on diluted net income (loss) per share using the treasury stock method since they may be settled in cash, shares or a combination thereof at the Company’s option. As a result, the Convertible Notes due 2023 will have no effect on diluted net income (loss) per share until the Company’s stock price exceeds the conversion price of $68.31 per share and certain other criteria are met, or if the trading price of the convertible notes meets certain criteria. In the period of conversion, the convertible notes will have no impact on diluted net income (loss) per share if they are settled in cash and will have an impact on dilutive net income (loss) per share if they are settled in shares upon conversion. The following table provides the numerators and denominators used in computing basic and diluted net income (loss) per share attributable to Envestnet, Inc.: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Basic net income (loss) per share calculation: Net income (loss) attributable to Envestnet, Inc. $ (4,924) $ 893 $ (12,260) $ (17,292) Basic number of weighted-average shares outstanding 53,562,850 50,870,296 53,288,741 49,526,774 Basic net income (loss) per share $ (0.09) $ 0.02 $ (0.23) $ (0.35) Diluted net income (loss) per share calculation: Net income (loss) attributable to Envestnet, Inc. $ (4,924) $ 893 $ (12,260) $ (17,292) Basic number of weighted-average shares outstanding 53,562,850 50,870,296 53,288,741 49,526,774 Effect of dilutive shares: Options to purchase common stock — 1,164,246 — — Unvested restricted stock units — 662,853 — — Convertible notes — 261,075 — — Warrants — 24,218 — — Diluted number of weighted-average shares outstanding 53,562,850 52,982,688 53,288,741 49,526,774 Diluted net income (loss) per share $ (0.09) $ 0.02 $ (0.23) $ (0.35) Securities that were anti-dilutive and therefore excluded from the computation of diluted net loss per share were as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Options to purchase common stock 600,924 — 600,924 1,654,241 Unvested restricted stock awards and units 1,922,978 — 1,922,978 1,989,437 Warrants 470,000 — 470,000 470,000 Convertible Notes 5,050,505 — 5,050,505 7,793,826 Total anti-dilutive securities 8,044,407 — 8,044,407 11,907,504 |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Business segments are generally organized around the Company's business services. The Company's business segments are: • Envestnet Wealth Solutions – a leading provider of unified wealth management software and services to empower financial advisors and institutions. • Envestnet Data & Analytics – a leading data aggregation and data analytics platform powering dynamic, cloud-based innovation for digital financial services. The information in the following tables is derived from the Company’s internal financial reporting used for corporate management purposes. Nonsegment operating expenses include salary and benefits for certain corporate officers, certain types of professional service expenses and insurance, acquisition related transaction costs, restructuring charges, and other non-recurring and/or non-operationally related expenses. Intersegment revenues were not material for the three and six months ended June 30, 2020 and 2019. See “Note 11—Revenues and Cost of Revenues” for detail of revenues by segment. The following table presents a reconciliation from Income (loss) from operations by segment to consolidated net income (loss) attributable to Envestnet, Inc.: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Envestnet Wealth Solutions $ 19,867 $ 12,379 $ 31,207 $ 29,223 Envestnet Data & Analytics (941) (8,960) (5,526) (16,888) Nonsegment operating expenses (14,918) (23,676) (29,290) (41,329) Income (loss) from operations 4,008 (20,257) (3,609) (28,994) Other expense, net (8,173) (7,512) (9,710) (13,275) Consolidated loss before income tax provision (benefit) (4,165) (27,769) (13,319) (42,269) Income tax provision (benefit) 1,306 (28,382) (658) (24,614) Consolidated net income (loss) (5,471) 613 (12,661) (17,655) Add: Net loss attributable to non-controlling interest 547 280 401 363 Consolidated net income (loss) attributable to Envestnet, Inc. $ (4,924) $ 893 $ (12,260) $ (17,292) A summary of consolidated total assets, consolidated depreciation and amortization and consolidated capital expenditures follows: June 30, December 31, 2020 2019 Segment assets: Envestnet Wealth Solutions $ 1,323,409 $ 1,297,891 Envestnet Data & Analytics 507,996 503,993 Consolidated assets $ 1,831,405 $ 1,801,884 Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Segment depreciation and amortization: Envestnet Wealth Solutions $ 20,081 $ 16,376 $ 39,501 $ 27,643 Envestnet Data & Analytics 8,362 10,539 16,625 18,789 Consolidated depreciation and amortization $ 28,443 $ 26,915 $ 56,126 $ 46,432 Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Segment capital expenditures: Envestnet Wealth Solutions $ 11,200 $ 10,027 $ 21,390 $ 20,865 Envestnet Data & Analytics 5,100 1,939 8,642 3,533 Consolidated capital expenditures $ 16,300 $ 11,966 $ 30,032 $ 24,398 |
Geographical Information
Geographical Information | 6 Months Ended |
Jun. 30, 2020 | |
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: June 30, December 31, 2020 2019 United States $ 123,130 $ 108,992 India 3,950 3,988 Other 696 1,039 Total long-lived assets, net $ 127,776 $ 114,019 See “Note 11—Revenues and Cost of Revenues” for detail of revenues by geographic area. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2020 | |
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 condensed 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. Legal Proceedings The Company and its subsidiary, Yodlee, Inc. (“Yodlee”), have been named as defendants in a lawsuit filed on July 17, 2019, by FinancialApps, LLC (“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. The motion to dismiss is fully briefed, and the parties are awaiting a decision from the District Court. 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. The motion to dismiss is fully briefed, and the parties are awaiting a decision from the District Court. The Company believes FinancialApps’s allegations are without merit and intends to defend the action and litigate the counterclaims vigorously. In addition, the Company is involved in legal proceedings arising in the ordinary course of its business. Legal fees and other costs associated with such actions are expensed as incurred. The Company will record a provision for these claims when it is both probable that a liability has been incurred and the amount of the loss, or a range of the potential loss, can be reasonably estimated. These provisions are reviewed regularly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel, and other information or events pertaining to a particular case. For litigation matters where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established, but if the matter is material, it is subject to disclosures. The Company believes that liabilities associated with any claims, while possible, are not probable, and therefore has not recorded an accrual for any claims as of June 30, 2020. Further, while any possible range of loss cannot be reasonably estimated at this time, the Company does not believe that the outcome of any of these proceedings, individually or in the aggregate, would, if determined adversely to it, have a material adverse effect on its financial condition or business, although an adverse resolution of legal proceedings could have a material adverse effect on the Company's results of operations or cash flow in a particular quarter or year. Contingencies Certain of the Company’s revenues are subject to sales and use taxes in certain jurisdictions where it conducts business in the United States. As of June 30, 2020 and December 31, 2019, the Company estimated a sales and use tax liability of $9,195 and $10,220, respectively, related to revenues in multiple jurisdictions. This amount is included in accrued expenses and other liabilities in the condensed consolidated balance sheets. As of June 30, 2020 and December 31, 2019, the Company also estimated a sales and use tax receivable of $3,372 and $3,346, respectively, related to the estimated recoverability of a portion of the liability from customers. This amount is included in prepaid expenses and other current assets in the condensed consolidated balance sheets. Additional future information obtained from the applicable jurisdictions may affect the Company's estimate of its sales and use tax liability, but such change in the estimate cannot currently be made. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements —In June 2016, the FASB issued ASU 2016-13 These changes became effective for the Company 's fiscal year beginning January 1, 2020. The Company recognized the cumulative effect of the initial application of ASU 2016-13 as an adjustment of $1,141, net of tax, to the opening balance of accumulated deficit. The Company does not expect the adoption of ASU 2016-13 to have a material impact to the results of its operations on an ongoing basis. Not Yet Adopted Accounting Pronouncements —In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes .” This update aims to reduce complexity within the accounting for income taxes as part of the simplification initiative |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Accounting Policies [Abstract] | |
Schedule of cash and cash equivalents | The following table reconciles cash, cash equivalents and restricted cash from the condensed consolidated balance sheets to amounts reported within the condensed consolidated statements of cash flows: June 30, June 30, 2020 2019 Cash and cash equivalents $ 92,244 $ 77,717 Restricted cash included in prepaid expenses and other current assets — 158 Restricted cash included in other non-current assets 148 168 Total cash, cash equivalents and restricted cash $ 92,392 $ 78,043 |
Schedule of reconciliation of cash, cash equivalents and restricted cash | The following table reconciles cash, cash equivalents and restricted cash from the condensed consolidated balance sheets to amounts reported within the condensed consolidated statements of cash flows: June 30, June 30, 2020 2019 Cash and cash equivalents $ 92,244 $ 77,717 Restricted cash included in prepaid expenses and other current assets — 158 Restricted cash included in other non-current assets 148 168 Total cash, cash equivalents and restricted cash $ 92,392 $ 78,043 |
Acquisitions and Other Invest_2
Acquisitions and Other Investments (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Business Combinations [Abstract] | |
Business acquisition, pro forma information | Pro forma financial information is presented for informational purposes and is not indicative of the results of operations that would have been achieved if the acquisitions had taken place as of the beginning of 2018. Three Months Ended June 30, Six Months Ended June 30, 2019 2019 Revenues $ 228,522 $ 443,275 Net loss attributable to Envestnet, Inc. $ (7,612) $ (18,857) Net loss per share attributable to Envestnet, Inc.: Basic $ (0.15) $ (0.37) Diluted $ (0.15) $ (0.37) |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following: June 30, December 31, 2020 2019 Prepaid technology $ 9,611 $ 8,178 Non-income tax receivables 5,851 5,555 Advance payroll taxes and benefits 4,922 5,446 Income tax receivables 3,124 — Prepaid outside information services 2,553 2,209 Prepaid insurance 1,976 1,919 Other 10,628 8,876 Total prepaid expenses and other current assets $ 38,665 $ 32,183 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of components of property and equipment, net | Property and equipment, net consists of the following: June 30, December 31, Estimated Useful Life 2020 2019 Cost: Computer equipment and software 3 years $ 71,090 $ 72,190 Leasehold improvements Shorter of the lease term or useful life of the asset 37,271 34,645 Office furniture and fixtures 3-7 years 10,668 10,832 Office equipment and other 3-5 years 6,925 6,850 Building and building improvements 7-39 years 2,669 2,647 Land Not applicable 940 940 129,563 128,104 Less: accumulated depreciation and amortization (79,811) (74,348) Total property and equipment, net $ 49,752 $ 53,756 Depreciation and amortization expense was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Depreciation and amortization expense $ 5,363 $ 6,751 $ 10,680 $ 11,117 |
Internally Developed Software (
Internally Developed Software (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Research and Development [Abstract] | |
Schedule of components of internally developed software, net | Internally developed software consists of the following: June 30, December 31, Estimated Useful Life 2020 2019 Internally developed software 5 years $ 130,406 $ 104,703 Less: accumulated amortization (52,382) (44,440) Internally developed software, net $ 78,024 $ 60,263 |
Schedule of amortization expense | Amortization expense was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Amortization expense $ 4,334 $ 3,110 $ 7,942 $ 5,733 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, Net (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in the carrying amount of goodwill by segment | Changes in the carrying amount of goodwill were as follows: Envestnet Wealth Solutions Envestnet Data & Analytics Total Balance at December 31, 2019 $ 583,247 $ 296,603 $ 879,850 Acquisitions 20,173 7,017 27,190 Foreign currency and other (70) (471) (541) Balance at June 30, 2020 $ 603,350 $ 303,149 $ 906,499 |
Schedule of components of intangible assets, net | Intangible assets, net consist of the following: June 30, 2020 December 31, 2019 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Customer lists $ 591,520 $ (173,895) $ 417,625 $ 591,520 $ (148,517) $ 443,003 Proprietary technologies 90,714 (53,822) 36,892 87,714 (44,165) 43,549 Trade names 33,700 (17,126) 16,574 33,700 (14,663) 19,037 Total intangible assets $ 715,934 $ (244,843) $ 471,091 $ 712,934 $ (207,345) $ 505,589 |
Schedule of amortization expense | Amortization expense was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Amortization expense $ 18,746 $ 17,054 $ 37,504 $ 29,582 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Payables and Accruals [Abstract] | |
Schedule accrued expenses and other liabilities | Accrued expenses and other liabilities consisted of the following: June 30, December 31, 2020 2019 Accrued investment manager fees $ 56,061 $ 48,720 Accrued compensation and related taxes 44,231 53,627 Non-income tax payables 10,307 11,040 Accrued professional services 5,321 3,833 Accrued technology 3,521 3,042 Accrued transaction costs 2,761 2,482 Accrued charitable contribution — 5,020 Other accrued expenses 12,561 10,180 Total accrued expenses and other liabilities $ 134,763 $ 137,944 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of convertible debt obligations | The Company’s outstanding debt obligations as of June 30, 2020 and December 31, 2019 were as follows: June 30, December 31, 2020 2019 Revolving credit facility balance $ 275,000 $ 260,000 Convertible Notes due 2023 $ 345,000 $ 345,000 Unaccreted discount on Convertible Notes due 2023 (28,811) (33,491) Unamortized issuance costs on Convertible Notes due 2023 (5,158) (5,996) Convertible Notes due 2023 carrying value (1) $ 311,031 $ 305,513 (1) The effective interest rate on the liability component of the Convertible Notes due 2023 was 6% for the three and six months ended June 30, 2020 and 2019. |
Schedule of interest expense | Interest expense was comprised of the following and is included in other expense, net in the condensed consolidated statement of operations: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Accretion of debt discount $ 2,349 $ 3,784 $ 4,680 $ 7,542 Interest on revolving credit facility 2,009 1,196 4,527 1,196 Coupon interest 1,510 2,264 3,011 4,528 Amortization of issuance costs 633 862 1,264 1,720 Undrawn and other fees 133 157 286 373 Total interest expense $ 6,634 $ 8,263 $ 13,768 $ 15,359 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule fair value of the Company’s financial assets and liabilities measured at fair value | The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis in the condensed consolidated balance sheets as of June 30, 2020 and December 31, 2019, based on the three-tier fair value hierarchy: June 30, 2020 Fair Value Level I Level II Level III Assets: Money market funds $ 47,351 $ 47,351 $ — $ — Assets to fund deferred compensation liability 9,076 — — 9,076 Total assets $ 56,427 $ 47,351 $ — $ 9,076 Liabilities: Contingent consideration $ 13,025 $ — $ — $ 13,025 Deferred compensation liability 7,596 7,596 — — Total liabilities $ 20,621 $ 7,596 $ — $ 13,025 December 31, 2019 Fair Value Level I Level II Level III Assets: Money market funds $ 37,730 $ 37,730 $ — $ — Assets to fund deferred compensation liability 8,390 — — 8,390 Total assets $ 46,120 $ 37,730 $ — $ 8,390 Liabilities: Contingent consideration $ 9,045 $ — $ — $ 9,045 Deferred compensation liability 8,208 8,208 — — Total liabilities $ 17,253 $ 8,208 $ — $ 9,045 |
Summary of changes in the fair value of the Company's Level 3 liability | The table below presents a reconciliation of the Company's contingent consideration liabilities, which were measured at fair value on a recurring basis using significant unobservable inputs (Level III) for the period from December 31, 2019 to June 30, 2020: Fair Value of Contingent Consideration Liabilities Balance at December 31, 2019 $ 9,045 Private technology company acquisition 5,239 Fair market value adjustment on contingent consideration liability (1,982) Accretion on contingent consideration 723 Balance at June 30, 2020 $ 13,025 |
Summary of changes in the fair value of the Company's Level 3 assets | The table below presents a reconciliation of the assets used to fund deferred the Company's deferred compensation liability, which is measured at fair value on a recurring basis using significant unobservable inputs (Level III) for the period from December 31, 2019 to June 30, 2020: Fair Value of Assets to Fund Deferred Compensation Liability Balance at December 31, 2019 $ 8,390 Contributions 1,060 Fair value adjustments (374) Balance at June 30, 2020 $ 9,076 |
Revenue and Cost of Revenues (T
Revenue and Cost of Revenues (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregation of revenue by major source | The following table presents the Company’s revenues disaggregated by major source: Three Months Ended June 30, 2020 2019 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Revenues: Asset-based $ 122,246 $ — $ 122,246 $ 120,070 $ — $ 120,070 Subscription-based 61,410 43,569 104,979 50,078 42,180 92,258 Total recurring revenues 183,656 43,569 227,225 170,148 42,180 212,328 Professional services and other revenues 4,029 4,059 8,088 6,742 5,375 12,117 Total revenues $ 187,685 $ 47,628 $ 235,313 $ 176,890 $ 47,555 $ 224,445 Six Months Ended June 30, 2020 2019 Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Envestnet Wealth Solutions Envestnet Data & Analytics Consolidated Revenues: Asset-based $ 257,057 $ — $ 257,057 $ 229,004 $ — $ 229,004 Subscription-based 121,733 87,797 209,530 91,104 84,241 175,345 Total recurring revenues 378,790 87,797 466,587 320,108 84,241 404,349 Professional services and other revenues 7,315 7,950 15,265 9,487 10,275 19,762 Total revenues $ 386,105 $ 95,747 $ 481,852 $ 329,595 $ 94,516 $ 424,111 |
Summary of revenues from major customers | One customer accounted for more than 10% of the Company’s total revenues: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Fidelity 15 % 15 % 15 % 15 % |
Schedule of disaggregation of revenue by geography | The following table presents the Company’s revenues disaggregated by geography, based on the billing address of the customer: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 United States $ 230,102 $ 217,462 $ 470,554 $ 409,581 International (1) 5,211 6,983 11,298 14,530 Total revenues $ 235,313 $ 224,445 $ 481,852 $ 424,111 (1) No foreign country accounted for more than 10% of the Company's total revenues. |
Schedule of estimated revenue expected to be recognized in the future | The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of June 30, 2020: Years ending December 31, Remainder of 2020 $ 114,905 2021 181,322 2022 135,410 2023 65,759 2024 35,319 Thereafter 35,393 Total $ 568,108 |
Schedule of costs of revenues by revenue category | The following table summarizes cost of revenues by revenue category: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Asset-based $ 61,875 $ 60,293 $ 130,467 $ 114,135 Subscription-based 6,807 6,697 13,084 14,374 Professional services and other 167 5,090 231 5,216 Total cost of revenues $ 68,849 $ 72,080 $ 143,782 $ 133,725 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of stock-based compensation expense | Stock-based compensation expense under the Company’s plans was as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Stock-based compensation expense $ 13,006 $ 13,434 $ 26,771 $ 26,298 Tax effect on stock-based compensation expense (3,317) (3,504) (6,826) (6,859) Net effect on income $ 9,689 $ 9,930 $ 19,945 $ 19,439 |
Schedule of weighted average assumptions used to value options granted | The following weighted average assumptions were used to value options granted during the periods indicated: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Grant date fair value of options $ — $ — $ — $ 21.55 Volatility — % — % — % 40.0 % Risk-free interest rate — % — % — % 2.5 % Dividend yield — % — % — % — % Expected term (in years) 0.0 0.0 0.0 6.5 |
Summary of option activity under the company's plans | The following table summarizes option activity under the Company’s plans: Weighted-Average Weighted- Remaining Average Contractual Life Aggregate Options Exercise Price (Years) Intrinsic Value Outstanding as of December 31, 2019 1,150,586 $ 25.66 3.4 $ 50,590 Granted — — Exercised (542,449) 16.97 Forfeited (7,213) 48.70 Outstanding as of June 30, 2020 600,924 33.23 4.0 24,225 Options exercisable 560,745 $ 32.10 3.7 $ 23,238 |
Summary 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 unvested restricted stock units and performance stock units granted under the Company’s plans: RSUs PSUs Number of Weighted- Number of Weighted- Outstanding as of December 31, 2019 1,318,870 $ 58.88 254,118 $ 67.96 Granted 951,428 74.52 67,793 81.42 Vested (533,088) 56.77 — — Forfeited (103,133) 59.89 (33,010) 64.70 Outstanding as of June 30, 2020 1,634,077 68.61 288,901 71.49 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Summary of loss before income tax provision (benefit) | The following table includes the Company’s loss before income tax provision (benefit), income tax provision (benefit) and effective tax rate: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Loss before income tax provision (benefit) $ (4,165) $ (27,769) $ (13,319) $ (42,269) Income tax provision (benefit) 1,306 (28,382) (658) (24,614) Effective tax rate (31.4) % 102.2 % 4.9 % 58.2 % |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of the numerators and denominators used in computing basic and diluted net loss per share attributable to common stockholders | The following table provides the numerators and denominators used in computing basic and diluted net income (loss) per share attributable to Envestnet, Inc.: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Basic net income (loss) per share calculation: Net income (loss) attributable to Envestnet, Inc. $ (4,924) $ 893 $ (12,260) $ (17,292) Basic number of weighted-average shares outstanding 53,562,850 50,870,296 53,288,741 49,526,774 Basic net income (loss) per share $ (0.09) $ 0.02 $ (0.23) $ (0.35) Diluted net income (loss) per share calculation: Net income (loss) attributable to Envestnet, Inc. $ (4,924) $ 893 $ (12,260) $ (17,292) Basic number of weighted-average shares outstanding 53,562,850 50,870,296 53,288,741 49,526,774 Effect of dilutive shares: Options to purchase common stock — 1,164,246 — — Unvested restricted stock units — 662,853 — — Convertible notes — 261,075 — — Warrants — 24,218 — — Diluted number of weighted-average shares outstanding 53,562,850 52,982,688 53,288,741 49,526,774 Diluted net income (loss) per share $ (0.09) $ 0.02 $ (0.23) $ (0.35) |
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 loss per share were as follows: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Options to purchase common stock 600,924 — 600,924 1,654,241 Unvested restricted stock awards and units 1,922,978 — 1,922,978 1,989,437 Warrants 470,000 — 470,000 470,000 Convertible Notes 5,050,505 — 5,050,505 7,793,826 Total anti-dilutive securities 8,044,407 — 8,044,407 11,907,504 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
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.: Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Envestnet Wealth Solutions $ 19,867 $ 12,379 $ 31,207 $ 29,223 Envestnet Data & Analytics (941) (8,960) (5,526) (16,888) Nonsegment operating expenses (14,918) (23,676) (29,290) (41,329) Income (loss) from operations 4,008 (20,257) (3,609) (28,994) Other expense, net (8,173) (7,512) (9,710) (13,275) Consolidated loss before income tax provision (benefit) (4,165) (27,769) (13,319) (42,269) Income tax provision (benefit) 1,306 (28,382) (658) (24,614) Consolidated net income (loss) (5,471) 613 (12,661) (17,655) Add: Net loss attributable to non-controlling interest 547 280 401 363 Consolidated net income (loss) attributable to Envestnet, Inc. $ (4,924) $ 893 $ (12,260) $ (17,292) |
Summary of consolidated total assets, consolidated depreciation and amortization and consolidated capital expenditures | A summary of consolidated total assets, consolidated depreciation and amortization and consolidated capital expenditures follows: June 30, December 31, 2020 2019 Segment assets: Envestnet Wealth Solutions $ 1,323,409 $ 1,297,891 Envestnet Data & Analytics 507,996 503,993 Consolidated assets $ 1,831,405 $ 1,801,884 Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Segment depreciation and amortization: Envestnet Wealth Solutions $ 20,081 $ 16,376 $ 39,501 $ 27,643 Envestnet Data & Analytics 8,362 10,539 16,625 18,789 Consolidated depreciation and amortization $ 28,443 $ 26,915 $ 56,126 $ 46,432 Three Months Ended Six Months Ended June 30, June 30, 2020 2019 2020 2019 Segment capital expenditures: Envestnet Wealth Solutions $ 11,200 $ 10,027 $ 21,390 $ 20,865 Envestnet Data & Analytics 5,100 1,939 8,642 3,533 Consolidated capital expenditures $ 16,300 $ 11,966 $ 30,032 $ 24,398 |
Geographical Information (Table
Geographical Information (Tables) | 6 Months Ended |
Jun. 30, 2020 | |
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: June 30, December 31, 2020 2019 United States $ 123,130 $ 108,992 India 3,950 3,988 Other 696 1,039 Total long-lived assets, net $ 127,776 $ 114,019 |
Organization and Description _2
Organization and Description of Business (Details) | 6 Months Ended |
Jun. 30, 2020segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 2 |
Basis of Presentation - Schedul
Basis of Presentation - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 92,244 | $ 82,505 | $ 77,717 | |
Restricted cash included in prepaid expenses and other current assets | 0 | 158 | ||
Restricted cash included in other non-current assets | 148 | 168 | ||
Total cash, cash equivalents and restricted cash | $ 92,392 | $ 82,755 | $ 78,043 | $ 289,671 |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2020 | Dec. 31, 2019 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | us-gaap:AccountingStandardsUpdate201613Member | ||||
Adoption of ASU 2016-13 | $ (873,737) | $ (867,576) | $ (864,197) | $ (853,790) | $ (621,538) | $ (632,602) |
Cumulative Effect, Period of Adoption, Adjustment | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Adoption of ASU 2016-13 | 1,141 | |||||
Accumulated Deficit | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Adoption of ASU 2016-13 | $ 89,065 | 75,664 | $ 84,141 | $ 76,174 | $ 77,067 | $ 58,882 |
Accumulated Deficit | Cumulative Effect, Period of Adoption, Adjustment | ||||||
Disaggregation of Revenue [Line Items] | ||||||
Adoption of ASU 2016-13 | $ 1,141 |
Acquisitions and Other Invest_3
Acquisitions and Other Investments - Narrative (Details) - USD ($) $ in Thousands | Mar. 03, 2020 | Mar. 02, 2020 | Feb. 18, 2020 | Jan. 08, 2020 | Jun. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||||||||
Payments to acquire equity method investments | $ 12,625 | $ 2,000 | ||||||||
Decrease in contingent consideration liability | $ 1,982 | 1,982 | $ 0 | |||||||
Goodwill | 906,499 | $ 906,499 | 906,499 | $ 879,850 | ||||||
Private Technology Company Acquisition | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration | $ 2,343 | |||||||||
Potential contingent consideration | 6,750 | |||||||||
Contingent consideration, fair value | 5,239 | |||||||||
Goodwill | 7,017 | |||||||||
Intangible assets | $ 1,000 | |||||||||
Private Cloud Technology Company | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration | $ 11,968 | |||||||||
Goodwill | $ 10,932 | |||||||||
Private Financial Technology Design Company | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration | $ 5,946 | |||||||||
Goodwill | 9,241 | |||||||||
Intangible assets | 2,000 | |||||||||
Valuation | 11,026 | |||||||||
Remeasurement gain on previously held interest | $ 4,230 | |||||||||
Goodwill, expected tax deductible amount | $ 1,800 | |||||||||
Equity method investment | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Revenue from related party | 2,384 | 5,073 | ||||||||
Receivable from related party | $ 1,468 | $ 1,468 | $ 1,468 | |||||||
Private services company | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Ownership percentage | 4.25% | |||||||||
Payments to acquire equity method investments | $ 11,000 | |||||||||
Private Financial Technology Design Company | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Ownership percentage | 45.00% |
Acquisitions and Other Invest_4
Acquisitions and Other Investments - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
Business Combinations [Abstract] | ||
Revenues | $ 228,522 | $ 443,275 |
Net loss attributable to Envestnet, Inc. | $ (7,612) | $ (18,857) |
Net loss per share attributable to Envestnet, Inc.: | ||
Basic (in dollars per share) | $ (0.15) | $ (0.37) |
Diluted (in dollars per share) | $ (0.15) | $ (0.37) |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid technology | $ 9,611 | $ 8,178 |
Non-income tax receivables | 5,851 | 5,555 |
Advance payroll taxes and benefits | 4,922 | 5,446 |
Income tax receivables | 3,124 | 0 |
Prepaid outside information services | 2,553 | 2,209 |
Prepaid insurance | 1,976 | 1,919 |
Other | 10,628 | 8,876 |
Total prepaid expenses and other current assets | $ 38,665 | $ 32,183 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Cost: | |||||
Property and equipment, gross | $ 129,563 | $ 129,563 | $ 128,104 | ||
Less: accumulated depreciation and amortization | (79,811) | (79,811) | (74,348) | ||
Total property and equipment, net | 49,752 | 49,752 | 53,756 | ||
Depreciation and amortization expense | 5,363 | $ 6,751 | $ 10,680 | $ 11,117 | |
Computer equipment and software | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Life | 3 years | ||||
Cost: | |||||
Property and equipment, gross | 71,090 | $ 71,090 | 72,190 | ||
Leasehold improvements | |||||
Cost: | |||||
Property and equipment, gross | 37,271 | 37,271 | 34,645 | ||
Office furniture and fixtures | |||||
Cost: | |||||
Property and equipment, gross | 10,668 | $ 10,668 | 10,832 | ||
Office furniture and fixtures | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Life | 3 years | ||||
Office furniture and fixtures | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Life | 7 years | ||||
Office equipment and other | |||||
Cost: | |||||
Property and equipment, gross | 6,925 | $ 6,925 | 6,850 | ||
Office equipment and other | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Life | 3 years | ||||
Office equipment and other | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Life | 5 years | ||||
Building and building improvements | |||||
Cost: | |||||
Property and equipment, gross | 2,669 | $ 2,669 | 2,647 | ||
Building and building improvements | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Life | 7 years | ||||
Building and building improvements | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Estimated Useful Life | 39 years | ||||
Land | |||||
Cost: | |||||
Property and equipment, gross | $ 940 | $ 940 | $ 940 |
Property, Plant, and Equipment
Property, Plant, and Equipment - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Envestnet Wealth Solutions | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost written off | $ 2,903 | $ 2,396 | $ 4,495 | $ 3,642 |
Envestnet Data and Analytics | ||||
Property, Plant and Equipment [Line Items] | ||||
Cost written off | $ 117 | $ 1,640 | $ 684 | $ 4,121 |
Internally Developed Software -
Internally Developed Software - Components of Internally Developed Software (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Internally developed software | $ 130,406 | $ 104,703 |
Less: accumulated amortization | (52,382) | (44,440) |
Internally developed software, net | $ 78,024 | $ 60,263 |
Internally developed software | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years |
Internally Developed Software_2
Internally Developed Software - Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Research and Development [Abstract] | ||||
Amortization expense | $ 4,334 | $ 3,110 | $ 7,942 | $ 5,733 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Net - Goodwill (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Changes in the carrying amount of the Company's goodwill | |
Balance at period start | $ 879,850 |
Acquisitions | 27,190 |
Foreign currency and other | (541) |
Balance at period end | 906,499 |
Envestnet Wealth Solutions | |
Changes in the carrying amount of the Company's goodwill | |
Balance at period start | 583,247 |
Acquisitions | 20,173 |
Foreign currency and other | (70) |
Balance at period end | 603,350 |
Envestnet Data and Analytics | |
Changes in the carrying amount of the Company's goodwill | |
Balance at period start | 296,603 |
Acquisitions | 7,017 |
Foreign currency and other | (471) |
Balance at period end | $ 303,149 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Net - Intangible Assets, Net (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 715,934 | $ 712,934 |
Accumulated Amortization | (244,843) | (207,345) |
Net Carrying Amount | 471,091 | 505,589 |
Customer lists | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 591,520 | 591,520 |
Accumulated Amortization | (173,895) | (148,517) |
Net Carrying Amount | 417,625 | 443,003 |
Proprietary technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 90,714 | 87,714 |
Accumulated Amortization | (53,822) | (44,165) |
Net Carrying Amount | 36,892 | 43,549 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 33,700 | 33,700 |
Accumulated Amortization | (17,126) | (14,663) |
Net Carrying Amount | $ 16,574 | $ 19,037 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Net - Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 18,746 | $ 17,054 | $ 37,504 | $ 29,582 |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Accrued investment manager fees | $ 56,061 | $ 48,720 |
Accrued compensation and related taxes | 44,231 | 53,627 |
Non-income tax payables | 10,307 | 11,040 |
Accrued professional services | 5,321 | 3,833 |
Accrued technology | 3,521 | 3,042 |
Accrued transaction costs | 2,761 | 2,482 |
Accrued charitable contribution | 0 | 5,020 |
Other accrued expenses | 12,561 | 10,180 |
Total accrued expenses and other liabilities | $ 134,763 | $ 137,944 |
Accrued Expenses and Other Li_4
Accrued Expenses and Other Liabilities - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020 | Dec. 31, 2019 | |
Payables and Accruals [Abstract] | ||
Severance expense | $ 12,000 | |
Early retirement program liability, current | 868 | $ 1,733 |
Early retirement program liability, noncurrent | $ 2,336 | $ 599 |
Debt - Summary (Details)
Debt - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | |||||
Revolving credit facility balance | $ 275,000 | $ 275,000 | $ 260,000 | ||
Convertible Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Face amount | 345,000 | 345,000 | 345,000 | ||
Unaccreted discount on convertible notes | (28,811) | (28,811) | (33,491) | ||
Unamortized issuance costs on convertible notes | (5,158) | (5,158) | (5,996) | ||
Convertible notes carrying value | $ 311,031 | $ 311,031 | $ 305,513 | ||
Effective interest rate (as a percent) | 6.00% | 6.00% | 6.00% | 6.00% |
Debt - Interest (Details)
Debt - Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Debt Disclosure [Abstract] | ||||
Accretion of debt discount | $ 2,349 | $ 3,784 | $ 4,680 | $ 7,542 |
Interest on revolving credit facility | 2,009 | 1,196 | 4,527 | 1,196 |
Coupon interest | 1,510 | 2,264 | 3,011 | 4,528 |
Amortization of issuance costs | 633 | 862 | 1,264 | 1,720 |
Undrawn and other fees | 133 | 157 | 286 | 373 |
Total interest expense | $ 6,634 | $ 8,263 | $ 13,768 | $ 15,359 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value (Details) - Recurring Basis - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Level I | ||
Assets: | ||
Assets to fund deferred compensation liability | $ 0 | $ 0 |
Total assets | 47,351 | 37,730 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
Deferred compensation liability | 7,596 | 8,208 |
Total liabilities | 7,596 | 8,208 |
Level I | Money Market Funds | ||
Assets: | ||
Money market funds | 47,351 | 37,730 |
Level II | ||
Assets: | ||
Assets to fund deferred compensation liability | 0 | 0 |
Total assets | 0 | 0 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
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 | 9,076 | 8,390 |
Total assets | 9,076 | 8,390 |
Liabilities: | ||
Contingent consideration | 13,025 | 9,045 |
Deferred compensation liability | 0 | 0 |
Total liabilities | 13,025 | 9,045 |
Level III | Money Market Funds | ||
Assets: | ||
Money market funds | 0 | 0 |
Fair Value | ||
Assets: | ||
Assets to fund deferred compensation liability | 9,076 | 8,390 |
Total assets | 56,427 | 46,120 |
Liabilities: | ||
Contingent consideration | 13,025 | 9,045 |
Deferred compensation liability | 7,596 | 8,208 |
Total liabilities | 20,621 | 17,253 |
Fair Value | Money Market Funds | ||
Assets: | ||
Money market funds | $ 47,351 | $ 37,730 |
Fair Value Measurements - Level
Fair Value Measurements - Level III (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance | $ 9,045 |
Acquisition | 5,239 |
Fair market value adjustment on contingent consideration liability | (1,982) |
Accretion on contingent consideration | 723 |
Balance | 13,025 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance | 8,390 |
Contributions | 1,060 |
Fair value adjustments | (374) |
Balance | $ 9,076 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Fair Value Measurements | ||
Convertible Notes due 2023 | $ 311,031 | $ 305,513 |
Revolving credit facility balance | 275,000 | 260,000 |
2023 Convertible Notes | ||
Fair Value Measurements | ||
Debt instrument, fair value disclosure | 419,430 | 414,852 |
2023 Convertible Notes | Carrying Value | ||
Fair Value Measurements | ||
Convertible Notes due 2023 | 311,031 | 305,513 |
Second Amended and Restated Credit Agreement | ||
Fair Value Measurements | ||
Revolving credit facility balance | $ 275,000 | $ 260,000 |
Revenue and Cost of Revenues -
Revenue and Cost of Revenues - Disaggregation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Revenues: | ||||
Total revenues | $ 235,313 | $ 224,445 | $ 481,852 | $ 424,111 |
United States | ||||
Revenues: | ||||
Total revenues | 230,102 | 217,462 | 470,554 | 409,581 |
International | ||||
Revenues: | ||||
Total revenues | 5,211 | 6,983 | 11,298 | 14,530 |
Total recurring revenues | ||||
Revenues: | ||||
Total revenues | 227,225 | 212,328 | 466,587 | 404,349 |
Asset-based | ||||
Revenues: | ||||
Total revenues | 122,246 | 120,070 | 257,057 | 229,004 |
Subscription-based | ||||
Revenues: | ||||
Total revenues | 104,979 | 92,258 | 209,530 | 175,345 |
Professional services and other revenues | ||||
Revenues: | ||||
Total revenues | 8,088 | 12,117 | 15,265 | 19,762 |
Envestnet Wealth Solutions | ||||
Revenues: | ||||
Total revenues | 187,685 | 176,890 | 386,105 | 329,595 |
Envestnet Wealth Solutions | Total recurring revenues | ||||
Revenues: | ||||
Total revenues | 183,656 | 170,148 | 378,790 | 320,108 |
Envestnet Wealth Solutions | Asset-based | ||||
Revenues: | ||||
Total revenues | 122,246 | 120,070 | 257,057 | 229,004 |
Envestnet Wealth Solutions | Subscription-based | ||||
Revenues: | ||||
Total revenues | 61,410 | 50,078 | 121,733 | 91,104 |
Envestnet Wealth Solutions | Professional services and other revenues | ||||
Revenues: | ||||
Total revenues | 4,029 | 6,742 | 7,315 | 9,487 |
Envestnet Data and Analytics | ||||
Revenues: | ||||
Total revenues | 47,628 | 47,555 | 95,747 | 94,516 |
Envestnet Data and Analytics | Total recurring revenues | ||||
Revenues: | ||||
Total revenues | 43,569 | 42,180 | 87,797 | 84,241 |
Envestnet Data and Analytics | Asset-based | ||||
Revenues: | ||||
Total revenues | 0 | 0 | 0 | 0 |
Envestnet Data and Analytics | Subscription-based | ||||
Revenues: | ||||
Total revenues | 43,569 | 42,180 | 87,797 | 84,241 |
Envestnet Data and Analytics | Professional services and other revenues | ||||
Revenues: | ||||
Total revenues | $ 4,059 | $ 5,375 | $ 7,950 | $ 10,275 |
Revenue and Cost of Revenues _2
Revenue and Cost of Revenues - Major Customers (Details) - Revenue from contract with customer benchmark - Customer concentration risk - Fidelity | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Concentration Risk [Line Items] | ||||
Revenue as a percentage of the company's total | 15.00% | 15.00% | 15.00% | 15.00% |
Envestnet Wealth Solutions | ||||
Concentration Risk [Line Items] | ||||
Revenue as a percentage of the company's total | 18.00% | 19.00% | 18.00% | 20.00% |
Revenue and Cost of Revenues _3
Revenue and Cost of Revenues - Obligation (Details) $ in Thousands | Jun. 30, 2020USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 568,108 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-07-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 114,905 |
Remaining Performance Obligations | |
Revenue recognition period | 6 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 181,322 |
Remaining Performance Obligations | |
Revenue recognition period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 135,410 |
Remaining Performance Obligations | |
Revenue recognition period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 65,759 |
Remaining Performance Obligations | |
Revenue recognition period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 35,319 |
Remaining Performance Obligations | |
Revenue recognition period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligations | $ 35,393 |
Remaining Performance Obligations | |
Revenue recognition period |
Revenue and Cost of Revenues _4
Revenue and Cost of Revenues - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |||||
Increase (decrease) in contract with customer liability | $ 7,585,000 | ||||
Recognized deferred revenue | $ 10,350,000 | $ 6,865,000 | 25,829,000 | $ 16,588,000 | |
Deferred sales incentive compensation | 10,072,000 | 10,072,000 | $ 9,387,000 | ||
Amortization expense for the deferred sales incentive compensation | $ 1,043,000 | $ 753,000 | 2,072,000 | 1,404,000 | |
Impairment loss for capitalized costs | $ 0 | $ 0 |
Revenue and Cost of Revenues _5
Revenue and Cost of Revenues - Cost of Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Product Information [Line Items] | ||||
Cost of revenues | $ 68,849 | $ 72,080 | $ 143,782 | $ 133,725 |
Asset-based | ||||
Product Information [Line Items] | ||||
Cost of revenues | 61,875 | 60,293 | 130,467 | 114,135 |
Subscription-based | ||||
Product Information [Line Items] | ||||
Cost of revenues | 6,807 | 6,697 | 13,084 | 14,374 |
Professional services and other | ||||
Product Information [Line Items] | ||||
Cost of revenues | $ 167 | $ 5,090 | $ 231 | $ 5,216 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Maximum number of shares available for future issuance (in shares) | 1,372,807 | 1,372,807 | ||
Statutory rate (as a percent) | 25.50% | 26.10% | 25.50% | 26.10% |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Stock-based compensation expense | $ 13,006 | $ 13,434 | $ 26,771 | $ 26,298 |
Tax effect on stock-based compensation expense | (3,317) | (3,504) | (6,826) | (6,859) |
Net effect on income | $ 9,689 | $ 9,930 | $ 19,945 | $ 19,439 |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions (Details) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | ||||
Grant date fair value of options (in dollars per share) | $ 0 | $ 0 | $ 0 | $ 21.55 |
Volatility | 0.00% | 0.00% | 0.00% | 40.00% |
Risk-free interest rate | 0.00% | 0.00% | 0.00% | 2.50% |
Dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Expected term (in years) | 0 years | 0 years | 0 years | 6 years 6 months |
Stock-Based Compensation - Opti
Stock-Based Compensation - Options (Details) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | |
Options | ||
Outstanding at the beginning of the period (in shares) | shares | 1,150,586 | |
Granted (in shares) | shares | 0 | |
Exercised (in shares) | shares | (542,449) | |
Forfeited (in shares) | shares | (7,213) | |
Outstanding at the end of the period (in shares) | shares | 600,924 | 1,150,586 |
Options exercisable (in shares) | shares | 560,745 | |
Weighted-Average Exercise Price | ||
Outstanding at the beginning of the period (in dollars per share) | $ 25.66 | |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 16.97 | |
Forfeited (in dollars per share) | 48.70 | |
Outstanding at the end of the period (in dollars per share) | 33.23 | $ 25.66 |
Options exercisable (in dollars per share) | $ 32.10 | |
Weighted-Average Remaining Contractual Life | ||
Outstanding | 4 years | 3 years 4 months 24 days |
Options exercisable | 3 years 8 months 12 days | |
Aggregate Intrinsic Value | ||
Outstanding (in dollars) | $ | $ 24,225 | $ 50,590 |
Options exercisable (in dollars) | $ | 23,238 | |
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | ||
Unrecognized stock-based compensation expense related to unvested stock options | $ | $ 468 | |
Options to purchase common stock | ||
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | ||
Unrecognized compensation expense weighted-average recognition period | 1 year 7 months 6 days | |
Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | ||
Exercise prices of stock options outstanding (in dollars per share) | $ 9 | |
Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | ||
Exercise prices of stock options outstanding (in dollars per share) | $ 55.29 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock (Details) $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2020USD ($)$ / sharesshares | |
RSUs | |
Number of Shares | |
Balance at the beginning of the period (in shares) | shares | 1,318,870 |
Granted (in shares) | shares | 951,428 |
Vested (in shares) | shares | (533,088) |
Forfeited (in shares) | shares | (103,133) |
Balance at the end of the period (in shares) | shares | 1,634,077 |
Weighted-Average Grant Date Fair Value per Share | |
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 58.88 |
Granted (in dollars per share) | $ / shares | 74.52 |
Vested (in dollars per share) | $ / shares | 56.77 |
Forfeited (in dollars per share) | $ / shares | 59.89 |
Balance at the end of the period (in dollars per share) | $ / shares | $ 68.61 |
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | |
Unrecognized compensation expense related to shares | $ | $ 99,676 |
Unrecognized compensation expense weighted-average recognition period | 2 years 2 months 12 days |
PSUs | |
Stock-Based compensation | |
Vesting period | 3 years |
Number of Shares | |
Balance at the beginning of the period (in shares) | shares | 254,118 |
Granted (in shares) | shares | 67,793 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | (33,010) |
Balance at the end of the period (in shares) | shares | 288,901 |
Weighted-Average Grant Date Fair Value per Share | |
Balance at the beginning of the period (in dollars per share) | $ / shares | $ 67.96 |
Granted (in dollars per share) | $ / shares | 81.42 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 64.70 |
Balance at the end of the period (in dollars per share) | $ / shares | $ 71.49 |
Share-based Compensation Arrangement by Share-based Payment Award, Additional General Disclosures [Abstract] | |
Unrecognized compensation expense related to shares | $ | $ 9,578 |
Unrecognized compensation expense weighted-average recognition period | 2 years 1 month 6 days |
PSUs | Minimum | |
Stock-Based compensation | |
Number of shares to be vest upon each evaluation date, percentage | 50.00% |
PSUs | Maximum | |
Stock-Based compensation | |
Number of shares to be vest upon each evaluation date, percentage | 150.00% |
Income Taxes - Loss Before Inco
Income Taxes - Loss Before Income Tax Provision (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Loss before income tax provision (benefit) | $ (4,165) | $ (27,769) | $ (13,319) | $ (42,269) |
Income tax provision (benefit) | $ 1,306 | $ (28,382) | $ (658) | $ (24,614) |
Effective tax rate | (31.40%) | 102.20% | 4.90% | 58.20% |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 30, 2019 |
Income Tax Disclosure [Abstract] | |||
Valuation allowance related to capital losses | $ 21,907 | ||
Gross unrecognized tax benefits | $ 20,261 | $ 18,939 | |
Unrecognized tax benefits, exclusive of interest and penalties, recorded as a non-current liability | 6,977 | 6,504 | |
Unrecognized tax benefits that would impact effective tax rate, if recognized | 14,618 | ||
Estimate for decrease in unrecognized tax benefits | 12,000 | ||
Accrued interest and penalties on unrecognized tax benefits | $ 8,000 | $ 7,336 |
Net Income (Loss) Per Share - C
Net Income (Loss) Per Share - Computation of Basic and Diluted Net Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Basic net income (loss) per share calculation: | ||||
Net income (loss) attributable to Envestnet, Inc. | $ (4,924) | $ 893 | $ (12,260) | $ (17,292) |
Basic number of weighted-average shares outstanding (in shares) | 53,562,850 | 50,870,296 | 53,288,741 | 49,526,774 |
Basic net income (loss) per share (in dollars per share) | $ (0.09) | $ 0.02 | $ (0.23) | $ (0.35) |
Diluted net income (loss) per share calculation: | ||||
Options to purchase common stock (in shares) | 0 | 1,164,246 | 0 | 0 |
Unvested restricted stock units (in shares) | 0 | 662,853 | 0 | 0 |
Convertible notes (in shares) | 0 | 261,075 | 0 | 0 |
Warrants (in shares) | 0 | 24,218 | 0 | 0 |
Diluted number of weighted-average shares outstanding (in shares) | 53,562,850 | 52,982,688 | 53,288,741 | 49,526,774 |
Diluted net income (loss) per share (in shares) | $ (0.09) | $ 0.02 | $ (0.23) | $ (0.35) |
Convertible notes due 2023 | ||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Conversion price (in dollars per share) | $ 68.31 | $ 68.31 |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Antidilutive Securities (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
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 loss per share (in shares) | 8,044,407 | 0 | 8,044,407 | 11,907,504 |
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 loss per share (in shares) | 600,924 | 0 | 600,924 | 1,654,241 |
Unvested restricted stock awards and units | ||||
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 loss per share (in shares) | 1,922,978 | 0 | 1,922,978 | 1,989,437 |
Warrants | ||||
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 loss per share (in shares) | 470,000 | 0 | 470,000 | 470,000 |
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 loss per share (in shares) | 5,050,505 | 0 | 5,050,505 | 7,793,826 |
Segment Information - Reconcili
Segment Information - Reconciliation of Income (Loss) From Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting Information [Line Items] | ||||||
Income (loss) from operations | $ 4,008 | $ (20,257) | $ (3,609) | $ (28,994) | ||
Nonsegment operating expenses | (231,305) | (244,702) | (485,461) | (453,105) | ||
Other expense, net | (8,173) | (7,512) | (9,710) | (13,275) | ||
Loss before income tax provision (benefit) | (4,165) | (27,769) | (13,319) | (42,269) | ||
Income tax provision (benefit) | 1,306 | (28,382) | (658) | (24,614) | ||
Net income (loss) | (5,471) | $ (7,190) | 613 | $ (18,268) | (12,661) | (17,655) |
Add: Net loss attributable to non-controlling interest | 547 | 280 | 401 | 363 | ||
Net income (loss) attributable to Envestnet, Inc. | (4,924) | 893 | (12,260) | (17,292) | ||
Operating Segments | Envestnet Wealth Solutions | ||||||
Segment Reporting Information [Line Items] | ||||||
Income (loss) from operations | 19,867 | 12,379 | 31,207 | 29,223 | ||
Operating Segments | Envestnet Data and Analytics | ||||||
Segment Reporting Information [Line Items] | ||||||
Income (loss) from operations | (941) | (8,960) | (5,526) | (16,888) | ||
Nonsegment | ||||||
Segment Reporting Information [Line Items] | ||||||
Nonsegment operating expenses | $ (14,918) | $ (23,676) | $ (29,290) | $ (41,329) |
Segment Information - Summary o
Segment Information - Summary of Consolidated Total Assets, Depreciation and Amortization and Capital Expenditures (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2020 | Jun. 30, 2019 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||||
Consolidated assets | $ 1,831,405 | $ 1,831,405 | $ 1,801,884 | ||
Consolidated depreciation and amortization | 28,443 | $ 26,915 | 56,126 | $ 46,432 | |
Consolidated capital expenditures | 16,300 | 11,966 | 30,032 | 24,398 | |
Envestnet Wealth Solutions | |||||
Segment Reporting Information [Line Items] | |||||
Consolidated assets | 1,323,409 | 1,323,409 | 1,297,891 | ||
Consolidated depreciation and amortization | 20,081 | 16,376 | 39,501 | 27,643 | |
Consolidated capital expenditures | 11,200 | 10,027 | 21,390 | 20,865 | |
Envestnet Data and Analytics | |||||
Segment Reporting Information [Line Items] | |||||
Consolidated assets | 507,996 | 507,996 | $ 503,993 | ||
Consolidated depreciation and amortization | 8,362 | 10,539 | 16,625 | 18,789 | |
Consolidated capital expenditures | $ 5,100 | $ 1,939 | $ 8,642 | $ 3,533 |
Geographical Information (Detai
Geographical Information (Details) - USD ($) $ in Thousands | Jun. 30, 2020 | Dec. 31, 2019 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 127,776 | $ 114,019 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 123,130 | 108,992 |
India | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | 3,950 | 3,988 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets | $ 696 | $ 1,039 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2020USD ($)claim | Dec. 31, 2019USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | ||
Number of previous claims experienced | claim | 0 | |
Sales and use tax liability | $ 9,195 | $ 10,220 |
Sales and use tax receivable | $ 3,372 | $ 3,346 |