Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 26, 2019 | |
Cover page. | ||
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Registrant Name | ETSY INC | |
Entity Central Index Key | 0001370637 | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-36911 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-4898921 | |
Entity Address, Address Line One | 117 Adams Street | |
Entity Address, City or Town | Brooklyn | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 11201 | |
City Area Code | 718 | |
Local Phone Number | 880-3660 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | ETSY | |
Security Exchange Name | NASDAQ | |
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 (in shares) | 120,459,900 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 359,159 | $ 366,985 |
Short-term investments | 274,673 | 257,302 |
Accounts receivable, net of allowance for doubtful accounts of $2,868 and $4,720 as of June 30, 2019 and December 31, 2018, respectively | 10,585 | 12,244 |
Prepaid and other current assets | 34,647 | 22,686 |
Funds receivable and seller accounts | 64,589 | 21,072 |
Total current assets | 743,653 | 680,289 |
Restricted cash | 5,341 | 5,341 |
Property and equipment, net of accumulated depreciation and amortization of $101,248 and $85,440 as of June 30, 2019 and December 31, 2018, respectively | 128,409 | 120,179 |
Goodwill | 37,342 | 37,482 |
Intangible assets, net of accumulated amortization of $10,332 and $7,378 as of June 30, 2019 and December 31, 2018, respectively | 33,142 | 34,589 |
Deferred tax assets | 23,319 | 23,464 |
Long-term investments | 25,438 | 0 |
Other assets | 25,131 | 507 |
Total assets | 1,021,775 | 901,851 |
Current liabilities: | ||
Accounts payable | 20,504 | 26,545 |
Accrued expenses | 55,687 | 49,158 |
Finance lease obligations—current | 9,306 | |
Finance lease obligations—current | 3,884 | |
Funds payable and amounts due to sellers | 64,589 | 21,072 |
Deferred revenue | 8,011 | 7,478 |
Other current liabilities | 8,413 | 3,925 |
Total current liabilities | 166,510 | 112,062 |
Finance lease obligations—net of current portion | 57,409 | |
Finance lease obligations—net of current portion | 2,095 | |
Deferred tax liabilities | 32,642 | 30,455 |
Facility financing obligation | 0 | 59,991 |
Long-term debt, net | 284,011 | 276,486 |
Other liabilities | 38,902 | 19,864 |
Total liabilities | 579,474 | 500,953 |
Commitments and contingencies (Note 11) | ||
Stockholders’ equity: | ||
Common stock ($0.001 par value, 1,400,000,000 shares authorized as of June 30, 2019 and December 31, 2018; 120,335,524 and 119,771,702 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively) | 120 | 120 |
Preferred stock ($0.001 par value, 25,000,000 shares authorized as of June 30, 2019 and December 31, 2018) | 0 | 0 |
Additional paid-in capital | 573,611 | 562,033 |
Accumulated deficit | (124,015) | (153,442) |
Accumulated other comprehensive loss | (7,415) | (7,813) |
Total stockholders’ equity | 442,301 | 400,898 |
Total liabilities and stockholders’ equity | $ 1,021,775 | $ 901,851 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 2,868 | $ 4,720 |
Intangible assets, accumulated amortization | 10,332 | 7,378 |
Property and equipment, accumulated depreciation and amortization | $ 101,248 | $ 85,440 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 1,400,000,000 | 1,400,000,000 |
Common stock, shares issued (in shares) | 120,335,524 | 119,771,702 |
Common stock, shares outstanding (in shares) | 120,335,524 | 119,771,702 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 25,000,000 | 25,000,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Statement [Abstract] | ||||
Revenue | $ 181,095 | $ 132,387 | $ 350,434 | $ 253,299 |
Cost of revenue | 58,605 | 45,409 | 111,263 | 86,704 |
Gross profit | 122,490 | 86,978 | 239,171 | 166,595 |
Operating expenses: | ||||
Marketing | 45,994 | 28,941 | 81,438 | 55,135 |
Product development | 28,765 | 23,568 | 53,712 | 44,289 |
General and administrative | 29,883 | 21,707 | 54,530 | 40,611 |
Total operating expenses | 104,642 | 74,216 | 189,680 | 140,035 |
Income from operations | 17,848 | 12,762 | 49,491 | 26,560 |
Other (expense) income: | ||||
Interest expense | (4,678) | (6,125) | (9,331) | (9,889) |
Interest and other income | 3,391 | 2,438 | 6,776 | 3,535 |
Foreign exchange (loss) gain | (192) | (4,450) | 870 | (2,600) |
Total other expense | (1,479) | (8,137) | (1,685) | (8,954) |
Income before income taxes | 16,369 | 4,625 | 47,806 | 17,606 |
Benefit (provision) for income taxes | 1,854 | (1,246) | 1,996 | (1,260) |
Net income | $ 18,223 | $ 3,379 | $ 49,802 | $ 16,346 |
Net income per share attributable to common stockholders: | ||||
Basic (in dollars per share) | $ 0.15 | $ 0.03 | $ 0.42 | $ 0.14 |
Diluted (in dollars per share) | $ 0.14 | $ 0.03 | $ 0.38 | $ 0.13 |
Weighted-average common shares outstanding: | ||||
Basic (in shares) | 120,198,526 | 119,450,194 | 119,848,289 | 120,819,201 |
Diluted (in shares) | 130,807,743 | 125,551,759 | 130,463,025 | 126,186,664 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 18,223 | $ 3,379 | $ 49,802 | $ 16,346 |
Other comprehensive income (loss): | ||||
Cumulative translation adjustment | 982 | (276) | (79) | (152) |
Unrealized gains (losses) on marketable securities, net of tax | 378 | 9 | 477 | (17) |
Total other comprehensive income (loss) | 1,360 | (267) | 398 | (169) |
Comprehensive income | $ 19,583 | $ 3,112 | $ 50,200 | $ 16,177 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Stockholders’ Equity (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss |
Balance at beginning of period (in shares) at Dec. 31, 2017 | 121,769,238 | ||||
Balance at beginning of period at Dec. 31, 2017 | $ 396,894 | $ 122 | $ 499,441 | $ (96,290) | $ (6,379) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 6,704 | 6,704 | |||
Exercise of vested options (in shares) | 887,906 | ||||
Exercise of vested options | 10,249 | $ 1 | 10,248 | ||
Issuance of convertible senior notes, net of issuance costs and taxes | 54,184 | 54,184 | |||
Purchase of capped call, net of taxes | (26,243) | (26,243) | |||
Vesting of restricted stock units, net of shares withheld (in shares) | 104,849 | ||||
Vesting of restricted stock units, net of shares withheld | (1,780) | (1,780) | |||
Stock repurchase (in shares) | (2,807,393) | ||||
Stock repurchase | (68,586) | $ (3) | (68,583) | ||
Other comprehensive (loss) income | 98 | 98 | |||
Net income | 12,967 | 12,967 | |||
Balance at period end (in shares) at Mar. 31, 2018 | 119,954,600 | ||||
Balance at period end at Mar. 31, 2018 | 384,487 | $ 120 | 542,554 | (151,906) | (6,281) |
Balance at beginning of period (in shares) at Dec. 31, 2017 | 121,769,238 | ||||
Balance at beginning of period at Dec. 31, 2017 | 396,894 | $ 122 | 499,441 | (96,290) | (6,379) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Other comprehensive (loss) income | (169) | ||||
Net income | 16,346 | ||||
Balance at period end (in shares) at Jun. 30, 2018 | 119,545,384 | ||||
Balance at period end at Jun. 30, 2018 | 370,091 | $ 120 | 546,121 | (169,602) | (6,548) |
Balance at beginning of period (in shares) at Mar. 31, 2018 | 119,954,600 | ||||
Balance at beginning of period at Mar. 31, 2018 | 384,487 | $ 120 | 542,554 | (151,906) | (6,281) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 9,179 | 9,179 | |||
Exercise of vested options (in shares) | 59,736 | ||||
Exercise of vested options | 476 | 476 | |||
Issuance of convertible senior notes, net of issuance costs and taxes | 30 | 30 | |||
Vesting of restricted stock units, net of shares withheld (in shares) | 253,989 | ||||
Vesting of restricted stock units, net of shares withheld | (6,118) | (6,118) | |||
Stock repurchase (in shares) | (722,941) | ||||
Stock repurchase | (21,075) | (21,075) | |||
Other comprehensive (loss) income | (267) | (267) | |||
Net income | 3,379 | 3,379 | |||
Balance at period end (in shares) at Jun. 30, 2018 | 119,545,384 | ||||
Balance at period end at Jun. 30, 2018 | $ 370,091 | $ 120 | 546,121 | (169,602) | (6,548) |
Balance at beginning of period (in shares) at Dec. 31, 2018 | 119,771,702 | 119,771,702 | |||
Balance at beginning of period at Dec. 31, 2018 | $ 400,898 | $ 120 | 562,033 | (153,442) | (7,813) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 8,616 | 8,616 | |||
Exercise of vested options (in shares) | 534,693 | ||||
Exercise of vested options | 5,930 | $ 1 | 5,929 | ||
Vesting of restricted stock units, net of shares withheld (in shares) | 159,403 | ||||
Vesting of restricted stock units, net of shares withheld | $ (5,672) | (5,672) | |||
Stock repurchase (in shares) | (532,412) | (532,412) | |||
Stock repurchase | $ (27,492) | $ (1) | (27,491) | ||
Other comprehensive (loss) income | (962) | (962) | |||
Net income | 31,579 | 31,579 | |||
Balance at period end (in shares) at Mar. 31, 2019 | 119,933,386 | ||||
Balance at period end at Mar. 31, 2019 | $ 420,013 | $ 120 | 570,906 | (142,238) | (8,775) |
Balance at beginning of period (in shares) at Dec. 31, 2018 | 119,771,702 | 119,771,702 | |||
Balance at beginning of period at Dec. 31, 2018 | $ 400,898 | $ 120 | 562,033 | (153,442) | (7,813) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Exercise of vested options (in shares) | 688,890 | ||||
Other comprehensive (loss) income | $ 398 | ||||
Net income | $ 49,802 | ||||
Balance at period end (in shares) at Jun. 30, 2019 | 120,335,524 | 120,335,524 | |||
Balance at period end at Jun. 30, 2019 | $ 442,301 | $ 120 | 573,611 | (124,015) | (7,415) |
Balance at beginning of period (in shares) at Mar. 31, 2019 | 119,933,386 | ||||
Balance at beginning of period at Mar. 31, 2019 | 420,013 | $ 120 | 570,906 | (142,238) | (8,775) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Stock-based compensation | 11,280 | 11,280 | |||
Exercise of vested options (in shares) | 154,197 | ||||
Exercise of vested options | 1,910 | 1,910 | |||
Vesting of restricted stock units, net of shares withheld (in shares) | 247,941 | ||||
Vesting of restricted stock units, net of shares withheld | (10,485) | (10,485) | |||
Other comprehensive (loss) income | 1,360 | 1,360 | |||
Net income | $ 18,223 | 18,223 | |||
Balance at period end (in shares) at Jun. 30, 2019 | 120,335,524 | 120,335,524 | |||
Balance at period end at Jun. 30, 2019 | $ 442,301 | $ 120 | $ 573,611 | $ (124,015) | $ (7,415) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities | ||
Net income | $ 49,802 | $ 16,346 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Stock-based compensation expense | 18,919 | 15,071 |
Depreciation and amortization expense | 19,952 | 12,677 |
Bad debt expense | 4,146 | 1,961 |
Foreign exchange (gain) loss | (1,240) | 2,849 |
Other non-cash losses, net | 6,314 | 3,914 |
Deferred income taxes | (1,996) | (377) |
Changes in operating assets and liabilities: | ||
Current assets | (51,284) | (1,805) |
Non-current assets | 2,037 | 32 |
Current liabilities | 37,626 | 11,848 |
Non-current liabilities | (2,982) | 4,245 |
Net cash provided by operating activities | 81,294 | 66,761 |
Cash flows from investing activities | ||
Cash paid for asset acquisition | 0 | (35,323) |
Purchases of property and equipment | (3,747) | (304) |
Development of internal-use software | (4,669) | (8,146) |
Purchases of marketable securities | (305,391) | (234,149) |
Sales of marketable securities | 265,852 | 50,472 |
Net cash used in investing activities | (47,955) | (227,450) |
Cash flows from financing activities | ||
Payment of tax obligations on vested equity awards | (16,157) | (7,898) |
Repurchase of stock | (27,492) | (89,661) |
Proceeds from exercise of stock options | 7,840 | 10,725 |
Proceeds from issuance of convertible senior notes | 0 | 345,000 |
Payment of debt issuance costs | (1,392) | (9,561) |
Purchase of capped call | 0 | (34,224) |
Payments on finance lease obligations | (5,475) | |
Payments on finance lease obligations | (3,421) | |
Payments on facility financing obligation | 0 | (5,469) |
Other financing, net | 2,072 | 1,023 |
Net cash (used in) provided by financing activities | (40,604) | 206,514 |
Effect of exchange rate changes on cash | (561) | (3,447) |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (7,826) | 42,378 |
Cash, cash equivalents, and restricted cash at beginning of period | 372,326 | 320,783 |
Cash, cash equivalents, and restricted cash at end of period | 364,500 | 363,161 |
Supplemental non-cash disclosures: | ||
Stock-based compensation capitalized in development of capitalized software | 977 | 812 |
Additions to development of internal-use software and property and equipment included in accounts payable and accrued expenses | 2,637 | 1,663 |
Additions to intangible assets included in other current liabilities | 1,720 | 0 |
Debt issuance costs included in accounts payable and accrued expenses | 0 | 406 |
Right-of-use assets obtained in exchange for new lease liabilities: | ||
Finance leases | 333 | |
Finance leases | 690 | |
Reconciliation of cash, cash equivalents, and restricted cash | ||
Total cash, cash equivalents, and restricted cash | $ 372,326 | $ 320,783 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Note 1—Basis of Presentation and Summary of Significant Accounting Policies Description of Business Etsy, Inc. (the “Company” or “Etsy”) is the global marketplace for unique and creative goods. The Company generates revenue primarily from transaction and listing fees, Etsy Payments fees, Promoted Listing fees, Etsy Shipping Label sales, Pattern fees, and Etsy Plus subscription fees. Basis of Consolidation The Consolidated Financial Statements include the accounts of Etsy and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Correction of Errors During the three months ended June 30, 2018 , the Company recorded $2.8 million of revenue and $1.4 million of cost of revenue as corrections of errors related to the years ended December 31, 2017 and 2016. The Company has concluded that the errors and their correction were not material to the Consolidated Financial Statements for any of the periods impacted nor are they material to the 2018 Consolidated Financial Statements. Unaudited Interim Financial Information The accompanying Consolidated Balance Sheet as of June 30, 2019 , the Consolidated Statements of Operations and Comprehensive Income for the three and six months ended June 30, 2019 and 2018 , the Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2019 and 2018 and the Consolidated Statement of Changes in Stockholders’ Equity for the three and six months ended June 30, 2019 and 2018 are unaudited. The unaudited interim financial statements have been prepared on the same basis as the annual Consolidated Financial Statements except for new accounting standards adopted as disclosed below, and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the Company’s financial position as of June 30, 2019 , results of operations for the three and six months ended June 30, 2019 and 2018 and cash flows for the six months ended June 30, 2019 and 2018 . The results for these interim periods are not necessarily indicative of the results to be anticipated for the full annual period or any future period. The financial data and the other information disclosed in these Notes to the Consolidated Financial Statements related to these three and six month periods are unaudited. These unaudited interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 28, 2019 (the “Annual Report”). During the first quarter of 2019, the Company adopted the accounting principles outlined within ASU 2016-02 —Leases, as described below . There have been no additional material changes in the Company’s significant accounting policies from those that were disclosed in the Annual Report. Use of Estimates The preparation of the Company’s Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets, liabilities, and equity at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The accounting estimates that require management’s most difficult and subjective judgments include: revenue recognition, determining the nature and timing of satisfaction of performance obligations and stand-alone selling price for use in allocating the subscription price of Etsy Plus; leases, determining the incremental borrowing rate; income taxes, including the estimate of annual effective tax rate at interim periods, assessment of valuation allowances, and evaluation of uncertain tax positions; website development costs and internal-use software; purchase price allocations for business combinations and contingent consideration; valuation of goodwill and intangible assets; stock-based compensation; and fair value of financial instruments . The Company evaluates its estimates and judgments on an ongoing basis and revises them when necessary. Actual results may differ from the original or revised estimates. Revenue Recognition The Company’s revenue is diversified; generated from a mix of marketplace activities and other optional services to help Etsy sellers generate more sales and scale their businesses. Revenues are recognized as the Company transfers control of promised goods or services to Etsy sellers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company evaluates whether it is appropriate to recognize revenue on a gross or net basis based upon its evaluation of whether the Company obtains control of the specified goods or services by considering if it is primarily responsible for fulfillment of the promise, has inventory risk, and has the latitude in establishing pricing and selecting suppliers, among other factors. Based on its evaluation of these factors, revenue is recorded either gross or net of costs associated with the transaction. With the exception of Etsy Shipping Labels, the Company’s revenues are recognized on a gross basis. Sales and usage-based taxes are excluded from revenues. See “ Note 2—Revenue ” for additional information regarding revenue recognition. Income Taxes The Company’s income tax (provision) benefit for interim periods is determined using an estimate of its annual effective tax rate adjusted for discrete items, if any, for relevant interim periods. The Company updates its estimate of the annual effective tax rate each quarter and makes cumulative adjustments if its estimated annual tax rate changes. The Company’s quarterly tax provision and quarterly estimate of its annual effective tax rate are subject to significant variations due to several factors, including variability in predicting its pretax and taxable income and the mix of jurisdictions to which those relate, changes of expenses or losses for which tax benefits are not recognized, recording of excess tax benefits related to stock-based compensation and changes in the laws, regulations, and administrative practices of the jurisdictions in which the Company operates. Net Income Per Share Basic net income per share attributable to common stockholders is computed by dividing the net income attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed by dividing net income for the period by the weighted-average number of shares of common stock and potentially dilutive common stock outstanding during the period. Net income in the diluted net income per share calculation is adjusted for income or loss from fair value adjustments on instruments accounted for as liabilities, but which may be settled in shares. The dilutive effect of outstanding options and stock-based compensation awards is reflected in diluted net income per share by application of the treasury stock method. Since the Company expects to settle in cash the principal outstanding under the 0% Convertible Senior Notes due 2023 the Company issued in March 2018 (the “Notes,” see “ Note 10—Debt ”), it uses the treasury stock method when calculating the potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have a dilutive impact on diluted net income per share of common stock when the average market price of the Company’s common stock for a given period exceeds the conversion price of $36.27 per share. The calculation of diluted net income per share excludes all anti-dilutive common shares. Cash and Cash Equivalents, and Short- and Long-term Investments The Company considers all investments with an original maturity of three months or less at time of purchase to be cash equivalents. Cash restricted by third parties is not considered cash and cash equivalents. Short-term investments, consisting primarily of commercial paper, United States government and agency securities, and corporate bonds with original maturities of greater than three months but less than one year when purchased, are classified as available-for-sale and are reported at fair value using the specific identification method. Long-term investments, consisting primarily of corporate bonds with original maturities of greater than twelve months but less than 37 months when purchased, are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated income tax provisions or benefits. The following table provides cash and cash equivalents, and short- and long-term investments within the Consolidated Balance Sheets as of the dates indicated (in thousands): As of As of Cash and cash equivalents $ 359,159 $ 366,985 Short-term investments 274,673 257,302 Long-term investments 25,438 — Total cash and cash equivalents, and short- and long-term investments $ 659,270 $ 624,287 Leases At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Operating leases are included in other assets, other current liabilities, and other liabilities on the Company’s Consolidated Balance Sheets. Finance leases are included in property and equipment, net, finance lease obligations, current, and finance lease obligations, net of current portion on the Company’s Consolidated Balance Sheets. Most leases with a term greater than one year are recognized on the Consolidated Balance Sheet as right-of-use (“ROU”) assets, lease obligations and, if applicable, long-term lease obligations in the line items cited above. The Company has elected not to recognize leases with terms of one year or less on the Consolidated Balance Sheets. Lease obligations and their corresponding ROU assets are recorded based on the present value of lease payments over the expected lease term. As the interest rate implicit in lease contracts is typically not readily determinable, the Company utilizes the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received. The lease term may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The components of a lease should be split into three categories: lease components, including land, building, or other similar components; non-lease components, including common area maintenance, maintenance, consumables, or other similar components; and non-components, including property taxes, insurance, or other similar components. However, the Company has elected to combine lease and non-lease components as a single component. The lease expense is recognized over the expected term on a straight-line basis. Recently Issued Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13 —Financial Instruments—Credit Losses (Topic 326)—Measurement of Credit Losses on Financial Instruments , and additional changes, modifications, clarifications, or interpretations related to this guidance thereafter, which require a reporting entity to estimate credit losses on certain types of financial instruments, and present assets held at amortized cost and available-for-sale debt securities at the amount expected to be collected. The new guidance is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-15 —Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40)—Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The new guidance is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its Consolidated Financial Statements. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02 —Leases (Topic 842), and additional changes, modifications, clarifications, or interpretations related to this guidance thereafter, which require a reporting entity to recognize ROU assets and lease liabilities on the balance sheet for operating leases to increase the transparency and comparability. Disclosure requirements have been enhanced with the objective of enabling financial statement users to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company adopted this standard in the first quarter of 2019, effective as of January 1, 2019, using the modified retrospective approach utilizing transition guidance introduced in ASU 2018-11— Leases: Targeted Improvements , and elected the ‘package of practical expedients’ permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward the historical lease identification, classification, and initial direct costs. The Company did not elect the hindsight practical expedient which permits entities to use hindsight in determining the lease term and assessing impairment. The Company also elected to continue to recognize lease payments related to short-term leases as an expense on a straight-line basis over the lease term. Upon adoption, the Company recognized new ROU assets and lease obligations on the Consolidated Balance Sheet for our operating leases of $25.4 million and $27.8 million , respectively. Additionally, upon adoption the Company renamed its capital lease obligations, current and capital lease obligations, net of current to finance lease obligations, current and finance lease obligations, net of current portion, respectively, in the Consolidated Balance Sheets. In 2014 the Company applied build-to-suit accounting treatment to its headquarters lease in Brooklyn, New York, as the Company was deemed the accounting owner of the construction project because of the Company’s involvement in the build-out of the space. Upon transition, the Company derecognized the facility financing obligation and related building assets recorded as a result of the failed sale and leaseback transactions and recorded any difference as a cumulative-effect adjustment to accumulated deficit. The adoption of this standard had a material impact on the Company’s financial position but did not and is not expected to significantly affect the Company’s results of operations. The Company has derecognized the existing facility financing obligation and existing building asset for sale-leaseback transactions that currently do not qualify for sale accounting of $60.0 million and $51.1 million , respectively, and $22.1 million was reclassified from building to leasehold improvements and will be amortized over the remaining term of the lease. The Company recognized a gain of $9.3 million , offset by a tax impact of $2.2 million associated with this change through accumulated deficit as of January 1, 2019, with a net decrease to accumulated deficit of $7.1 million , and recognized a new ROU asset of $66.7 million |
Revenue
Revenue | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 2—Revenue The following table summarizes revenue by type of service for the periods presented (in thousands): Three Months Ended Six Months Ended 2019 2018 2019 2018 Marketplace revenue $ 134,403 $ 91,306 $ 260,533 $ 179,273 Services revenue 45,896 39,507 88,067 72,112 Other revenue 796 1,574 1,834 1,914 Revenue $ 181,095 $ 132,387 $ 350,434 $ 253,299 Marketplace Revenue : As members of the Etsy marketplace, Etsy sellers receive the benefit of marketplace activities, including listing items for sale, completing sales transactions, and payments processing, which represents a single stand ready performance obligation. Etsy sellers pay a fixed listing fee of $0.20 for each item listed on Etsy.com for a period of four months or, if earlier, until a sale occurs. Variable fees include the 5% transaction fee that an Etsy seller pays for each completed transaction, inclusive of shipping fees charged, and Etsy Payments fees for processing payments, including foreign currency payments. On July 16, 2018 , the Company increased the seller transaction fee from 3.5% to 5% of each completed transaction, and now applies it to the cost of shipping in addition to the cost of the item. Etsy Payments processing fees vary between 3 - 4.5% of an item’s total sale price, including shipping, plus a flat fee per order, depending on the country in which a seller’s bank account is located. The Company earns additional fees on transactions in which currency conversions are performed. The listing fee is recognized ratably over a four -month listing period, unless the item is sold or the seller re-lists it, at which time any remaining listing fee is recognized. The transaction fee and Etsy Payments fees are recognized when the corresponding transaction is consummated. Listing fees are nonrefundable while transaction fees and Etsy Payments fees are recorded net of refunds. Services revenue : Services revenue is derived from optional services offered to Etsy sellers, which include Promoted Listings, Etsy Shipping Labels, Pattern, and Etsy Plus. Each service below represents an individual obligation that the Company must perform when an Etsy seller chooses to use the service. • Revenue from Promoted Listings, the Company’s on-site advertising service, consists of cost-per-click fees an Etsy seller pays for prominent placement of her listings in search results in the Company’s marketplace. Promoted Listings fees are based on an auction system, which utilizes the budget that each Etsy seller sets when using Promoted Listings to determine the cost-per-click fee. Promoted Listing fees are nonrefundable and are charged to a seller’s Etsy bill when the Promoted Listing is clicked, at which time revenue is recognized. • Revenue from Etsy Shipping Labels consists of fees an Etsy seller pays the Company when she purchases shipping labels through its platform, net of the cost the Company incurs in purchasing those shipping labels. The Company provides its sellers access to purchase shipping labels at discounted pricing due to the volume of purchases through its platform. The Company recognizes Etsy Shipping Label revenue when an Etsy seller purchases a shipping label. The Company recognizes Etsy Shipping Label revenue on a net basis as it is an agent in this arrangement and does not take control of shipping labels prior to transferring the labels to the Etsy Seller. Etsy Shipping Label revenue is recorded net of refunds. • Revenue from Pattern consists of monthly subscription fees an Etsy seller pays to use the Company’s custom website services. The Company recognizes revenue from Pattern ratably over the term of the subscription. The Pattern subscription fee is $15 per month and is nonrefundable. • Revenue from Etsy Plus consists of monthly subscription fees an Etsy seller pays for enhanced tools and credits for use on the Company’s platform. The Etsy Plus subscription fee is $10 per month and is nonrefundable. Each feature represents its own distinct performance obligation. The Company allocates subscription revenue based on the relative actual or estimated stand-alone selling price of the features included in the Etsy Plus offering. Each performance obligation is recognized in accordance with how the benefit is transferred to the customer. Other revenue : Other revenue typically includes revenue generated from commercial partnerships, which are recognized as the customer in each contract consumes the benefit of the service Etsy provides in each arrangement. Contract balances Deferred revenues The Company records deferred revenues when cash payments are received or due in advance of the completion of the listing or subscription period, which represents the value of the Company’s unsatisfied performance obligations. Deferred listing revenue is recognized ratably over the remainder of the four -month listing period, unless the item is sold or the seller re-lists it, at which time any remaining listing fee is recognized. Deferred Etsy Plus subscription revenues related to the enhanced features noted above are recognized ratably over the 30 -day subscription period. Credits for Promoted Listings are recognized when used, or when the 30 -day subscription period expires. Credits for listing fees are recognized over the four -month listing period when used, and any unused credits are recognized when the 30 -day subscription period expires. The amount of revenue recognized in the six months ended June 30, 2019 that was included in the deferred balance at January 1, 2019 was $7.5 million . |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 3—Income Taxes On December 22, 2017, the U.S. government enacted The Tax Cuts and Jobs Act (“The TCJA”) which includes significant changes to the taxation of business entities. These changes include, among others, (1) a permanent reduction to the corporate income tax rate, (2) a partial limitation on the deductibility of business interest expense, and (3) a shift of the U.S. taxation of multinational corporations from a tax on worldwide income to a quasiterritorial system (along with certain rules designed to prevent erosion of the U.S. income tax base). Effective January 1, 2018, the Company is subject to several provisions of The TCJA including computations under Global Intangible Low Taxed Income (“GILTI”) and Foreign Derived Intangible Income (“FDII”). For the GILTI and FDII computations, the Company recorded tax expense using the current available regulations and the technical guidance on the interpretations of The TCJA. The Company has recorded the impacts of The TCJA in our effective tax rate for the three and six months ended June 30, 2019 and have elected to treat taxes due on future U.S. inclusions in taxable income related to GILTI using the period cost method. On June 21, 2019, the Internal Revenue Service issued final regulations relating to the GILTI and foreign tax credit provisions of the TCJA and proposed GILTI regulations for high-tax exception. The Company has evaluated the impact of the final and proposed GILTI regulations and concluded they were not material to the financial statements. The Company will continue to monitor the technical guidance of the proposed GILTI regulations. The Company will continue to monitor the forthcoming regulations and additional guidance of the FDII and Base Erosion and Anti-Abuse Tax (“BEAT”) provisions under the TCJA, which are complex and subject to continuing regulatory interpretations. The amount of unrecognized tax benefits included in the Consolidated Balance Sheets increased $1.0 million in the six months ended June 30, 2019 , from $18.8 million at December 31, 2018 to $19.8 million at June 30, 2019 . The total amount of unrecognized tax benefits that, if recognized, would favorably affect the effective tax rate is $19.8 million at June 30, 2019 . Although the timing of the resolution and/or closure of audits is highly uncertain, it is reasonably possible that the balance of gross unrecognized tax benefits could significantly change in the next 12 months. Given the number of years remaining subject to examination and the number of matters being examined, at this time we are unable to estimate the full range of possible adjustments to the balance of gross unrecognized tax benefits. The Company recognizes interest and/or penalties related to uncertain tax positions in income tax expense. The amount of interest and penalties accrued in tax expense for the six months ended June 30, 2019 increased by $0.3 million , from $ 0.5 million at December 31, 2018 to $0.8 million at June 30, 2019 |
Net Income Per Share
Net Income Per Share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Note 4— Net Income Per Share The following table presents the calculation of basic and diluted net income per share for periods presented (in thousands except share and per share amounts): Three Months Ended Six Months Ended 2019 2018 2019 2018 Numerator: Net inco me $ 18,223 $ 3,379 $ 49,802 $ 16,346 Net income allocated to participating securities under the two-class method (9 ) (3 ) (24 ) (16 ) Net inco me applicable to common stockholde rs—basic 18,214 3,376 49,778 16,330 Dilutive effect of net income allocated to participating securities under the two-class method 9 3 24 16 Net income attributable to common stockholders—diluted $ 18,223 $ 3,379 $ 49,802 $ 16,346 Denominator: Weighted-average common shares outstanding—basic (1) 120,198,526 119,450,194 119,848,289 120,819,201 Dilutive effect of assumed conversion of options to purchase common stock 4,667,849 3,964,746 4,764,942 3,559,951 Dilutive effect of assumed conversion of restricted stock units 1,693,130 2,053,861 1,841,363 1,733,777 Dilutive effect of assumed conversion of convertible debt 4,226,839 — 3,989,402 — Dilutive effect of assumed conversion of restricted stock from acquisition 21,399 82,958 19,029 73,735 Weighted-average common shares outstanding—diluted 130,807,743 125,551,759 130,463,025 126,186,664 Net inco me per share attributable to common stockholders—b asic $ 0.15 $ 0.03 $ 0.42 $ 0.14 Net income per share a ttri butable to common stockholders—diluted $ 0.14 $ 0.03 $ 0.38 $ 0.13 (1) 22,993 and 23,759 shares of unvested stock are considered participating securities and are excluded from basic shares outstanding for the three and six months ended June 30, 2019 , respectively. The following potential common shares were excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Three Months Ended Six Months Ended 2019 2018 2019 2018 Stock options 337,907 642,418 224,706 421,412 Restricted stock units 716,869 118,209 424,461 1,054,803 Total anti-dilutive securities 1,054,776 760,627 649,167 1,476,215 |
Segment and Geographic Informat
Segment and Geographic Information | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Note 5—Segment and Geographic Information The Company has determined it operates as one operating and reportable segment for purposes of allocating resources and evaluating financial performance. Revenue by country is based on the billing address of the seller. The following table summarizes revenue, (loss) income before income taxes , and net (loss) income by geographic area for the periods presented (in thousands): Three Months Ended Six Months Ended 2019 2018 2019 2018 United States $ 119,670 $ 96,805 $ 232,934 $ 181,728 International 61,425 35,582 117,500 71,571 Revenue $ 181,095 $ 132,387 $ 350,434 $ 253,299 United States (1) $ (11,897 ) $ 8,017 $ (6,902 ) $ 5,752 International (2) 28,266 (3,392 ) 54,708 11,854 (Loss) income before income taxes $ 16,369 $ 4,625 $ 47,806 $ 17,606 United States (1) $ (6,146 ) $ 7,525 $ 2,546 $ 5,507 International (2) 24,369 (4,146 ) 47,256 10,839 Net (loss) income $ 18,223 $ 3,379 $ 49,802 $ 16,346 (1) The United States loss before income taxes in the three and six months ended June 30, 2019 and the net loss in the three months ended June 30, 2019 was primarily driven by a majority of operating expenses being incurred in the United States. (2) The International loss before income taxes and net loss in the three months ended June 30, 2018 was primarily driven by a foreign exchange loss related to the U.S. Dollar to Euro exchange rate fluctuations on the Company's intercompany and other non-functional currency balances. No individual country’s revenue other than the United States exceeded 10% of total revenue for the periods presented. All significant long-lived assets are located in the United States. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 6—Fair Value Measurements The Company has characterized its investments in marketable securities, based on the priority of the inputs used to value the investments, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1), and lowest priority to unobservable inputs (Level 3). If the inputs used to measure the investments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the investment. Investments recorded in the accompanying Consolidated Balance Sheet are categorized based on the inputs to valuation techniques as follows: Level 1—These are investments where values are based on unadjusted quoted prices for identical assets in an active market that the Company has the ability to access. Level 2—These are investments where values are based on quoted market prices in markets that are not active or model derived valuations in which all significant inputs are observable in active markets. Level 3—These are financial instruments where values are derived from techniques in which one or more significant inputs are unobservable. The following are the major categories of assets measured at fair value on a recurring basis as of June 30, 2019 and December 31, 2018 (in thousands): As of June 30, 2019 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 272,246 $ — $ — $ 272,246 272,246 — — 272,246 Short-term investments: Commercial paper — 79,028 — 79,028 Corporate bonds — 83,924 — 83,924 U.S. Government and agency securities 111,721 — — 111,721 111,721 162,952 — 274,673 Funds receivable and seller accounts: Money market funds 20,308 — — 20,308 20,308 — — 20,308 Long-term investments: Corporate bonds — 25,438 — 25,438 — 25,438 — 25,438 $ 404,275 $ 188,390 $ — $ 592,665 As of December 31, 2018 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Commercial paper $ — $ 7,775 $ — $ 7,775 Money market funds 244,856 — — 244,856 244,856 7,775 — 252,631 Short-term investments: Commercial paper — 147,860 — 147,860 Corporate bonds — 46,801 — 46,801 U.S. Government and agency securities 62,641 — — 62,641 62,641 194,661 — 257,302 Funds receivable and seller accounts: Money market funds 9,229 — — 9,229 9,229 — — 9,229 $ 316,726 $ 202,436 $ — $ 519,162 Level 1 instruments include investments in debt securities including money market funds and U.S. government and agency securities, which are valued based on inputs including quotes from broker-dealers or recently executed transactions in the same or similar securities. Level 2 instruments include investments in debt securities, including fixed-income funds consisting of investments in commercial paper and corporate bonds, which are valued based on quoted market prices in markets that are not active or model derived valuations in which all significant inputs are observable in active markets. The Company did not have any Level 3 instruments as of June 30, 2019 and December 31, 2018 . See “ Note 7—Marketable Securities ” for additional information on the Company’s marketable securities measured at fair value. Disclosure of Fair Values The Company’s financial instruments that are not remeasured at fair value include the Notes (see “ Note 10—Debt ”). The Company estimates the fair value of the Notes through consideration of quoted market prices of similar instruments, classified as Level 2 as described above. The estimated fair value of the Notes was $303.5 million and $279.1 million as of June 30, 2019 and December 31, 2018 |
Marketable Securities
Marketable Securities | 6 Months Ended |
Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities | Note 7—Marketable Securities Short- and long-term investments and certain cash equivalents consist of investments in debt securities that are available-for-sale. The cost and fair value of available-for-sale securities were as follows as of the dates indicated (in thousands): Cost Gross Gross Fair Value June 30, 2019 Short-term investments: Commercial paper $ 79,028 $ — $ — $ 79,028 Corporate bonds 83,778 — 146 83,924 U.S. Government and agency securities 111,575 — 146 111,721 274,381 — 292 274,673 Long-term investments: Corporate bonds 25,296 — 142 25,438 25,296 — 142 25,438 $ 299,677 $ — $ 434 $ 300,111 December 31, 2018 Cash equivalents: Commercial paper $ 7,775 $ — $ — $ 7,775 7,775 — — 7,775 Short-term investments: Commercial paper 147,860 — — 147,860 Corporate bonds 46,836 (35 ) — 46,801 U.S. Government and agency securities 62,638 (9 ) 12 62,641 257,334 (44 ) 12 257,302 $ 265,109 $ (44 ) $ 12 $ 265,077 The Company’s investments in marketable securities consist primarily of investments in debt securities, including U.S. government and agency securities and fixed-income funds. When evaluating investments for other-than-temporary impairment, the Company reviews factors such as length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and the Company’s ability, and intent to hold the investment for a period of time, which may be sufficient for anticipated recovery in market value. The Company evaluates fair values for each individual security in the investment portfolio. See “ Note 6—Fair Value Measurements ” for additional information on the Company’s marketable securities measured at fair value. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Leases | Note 8—Leases As the lessee, the Company currently leases 225,135 square feet of real estate space for its corporate headquarters located in Brooklyn, New York, under a noncancelable lease that expires in 2026. The Company uses these facilities for its principal administration, technology and development, and engineering activities. The Company also leases office space for its offices in San Francisco, Hudson (New York), Dublin, and London. Additionally, the Company has short-term leases in other locations around the world that meet short-term lease criteria and are not recognized on the Consolidated Balance Sheets. Most leases include one or more options to renew, and the exercise of these options is at the Company’s sole discretion. The Company determined that its options to break or renew would not be reasonably certain in determining the expected lease term, and therefore are not included as part of its ROU assets and lease liabilities. The Company entered into financing lease agreements with Dell Financial Services, LLC. (“DFS”) and ePlus Group, Inc. (“ePlus”) for hosting and computer equipment leases. The leases through DFS have a 36 -month term, zero interest, and are payable in equal monthly installments with a buy-out option of $1 at the end of the lease term. The leases through ePlus have a 36 -month term, interest rate of 3.71% - 6.93% , and are payable in equal monthly installments with a fair market value or a $1 buy-out option at the end of the lease term depending on the equipment. In calculating the present value of the lease payments, the Company has elected to utilize its estimated incremental borrowing rate based on the remaining lease term and not the original lease term. The depreciable life of assets and leasehold improvements are limited by the expected lease term. The elements of lease expense were as follows (in thousands): Three Months Ended Six Months Ended Operating lease cost $ 1,272 $ 2,550 Finance lease cost: Amortization of right-of-use assets 3,320 6,690 Interest on lease liabilities 823 1,693 Total finance lease cost 4,143 8,383 Other lease cost, net (1) 126 68 Total lease cost $ 5,541 $ 11,001 (1) Other lease cost, net includes short-term sublease income, short-term lease costs, and variable lease costs, which are immaterial. The following table presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheet (in thousands): As of June 30, 2019 Operating leases: Other assets $ 23,410 Other current liabilities $ 3,995 Other liabilities 21,638 Total operating lease liabilities $ 25,633 Finance leases: Property and equipment, net $ 65,621 Finance lease obligations—current $ 9,306 Finance lease obligations—net of current portion 57,409 Total finance lease liabilities $ 66,715 The following table summarizes the weighted average remaining lease term and weighted average discount rate as of June 30, 2019 : As of June 30, 2019 Weighted average remaining lease term: Operating leases 6.52 years Finance leases 6.75 years Weighted average discount rate: Operating leases 4.26 % Finance leases 4.37 % Supplemental cash flow information related to leases was as follows (in thousands): Six Months Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating lea ses $ (2,390 ) Operating cash flows used in finance lea ses (1,681 ) Finance cash flows used in finance lea ses (5,475 ) Future minimum lease payments under non-cancelable leases for the six months ending December 31, 2019 and years ending December 31, 2020 , 2021 , 2022 , 2023 , and thereafter are as follows (in thousands): Operating Leases Finance Leases 2019 $ 2,313 $ 6,000 2020 4,793 11,400 2021 4,182 10,960 2022 4,177 10,547 2023 4,201 10,599 Thereafter 9,756 27,715 Total future minimum lease payments 29,422 77,221 Less imputed interest 3,789 10,506 Total $ 25,633 $ 66,715 The following table represents the Company’s commitments under its previous presentation of its capital, operating, and build-to-suit lease agreements as of December 31, 2018 (in thousands): Capital Lease Operating Build-to-Suit Periods ending 2019 $ 4,392 $ 4,904 $ 9,451 2020 1,754 4,783 9,522 2021 481 4,185 10,354 2022 — 4,180 10,520 2023 — 4,205 10,599 Thereafter — 9,760 27,715 Total minimum payments required $ 6,627 $ 32,017 $ 78,161 Amounts representing interest 648 Present value of net minimum payments 5,979 Current maturities 3,884 Long-term payment obligations $ 2,095 |
Leases | Note 8—Leases As the lessee, the Company currently leases 225,135 square feet of real estate space for its corporate headquarters located in Brooklyn, New York, under a noncancelable lease that expires in 2026. The Company uses these facilities for its principal administration, technology and development, and engineering activities. The Company also leases office space for its offices in San Francisco, Hudson (New York), Dublin, and London. Additionally, the Company has short-term leases in other locations around the world that meet short-term lease criteria and are not recognized on the Consolidated Balance Sheets. Most leases include one or more options to renew, and the exercise of these options is at the Company’s sole discretion. The Company determined that its options to break or renew would not be reasonably certain in determining the expected lease term, and therefore are not included as part of its ROU assets and lease liabilities. The Company entered into financing lease agreements with Dell Financial Services, LLC. (“DFS”) and ePlus Group, Inc. (“ePlus”) for hosting and computer equipment leases. The leases through DFS have a 36 -month term, zero interest, and are payable in equal monthly installments with a buy-out option of $1 at the end of the lease term. The leases through ePlus have a 36 -month term, interest rate of 3.71% - 6.93% , and are payable in equal monthly installments with a fair market value or a $1 buy-out option at the end of the lease term depending on the equipment. In calculating the present value of the lease payments, the Company has elected to utilize its estimated incremental borrowing rate based on the remaining lease term and not the original lease term. The depreciable life of assets and leasehold improvements are limited by the expected lease term. The elements of lease expense were as follows (in thousands): Three Months Ended Six Months Ended Operating lease cost $ 1,272 $ 2,550 Finance lease cost: Amortization of right-of-use assets 3,320 6,690 Interest on lease liabilities 823 1,693 Total finance lease cost 4,143 8,383 Other lease cost, net (1) 126 68 Total lease cost $ 5,541 $ 11,001 (1) Other lease cost, net includes short-term sublease income, short-term lease costs, and variable lease costs, which are immaterial. The following table presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheet (in thousands): As of June 30, 2019 Operating leases: Other assets $ 23,410 Other current liabilities $ 3,995 Other liabilities 21,638 Total operating lease liabilities $ 25,633 Finance leases: Property and equipment, net $ 65,621 Finance lease obligations—current $ 9,306 Finance lease obligations—net of current portion 57,409 Total finance lease liabilities $ 66,715 The following table summarizes the weighted average remaining lease term and weighted average discount rate as of June 30, 2019 : As of June 30, 2019 Weighted average remaining lease term: Operating leases 6.52 years Finance leases 6.75 years Weighted average discount rate: Operating leases 4.26 % Finance leases 4.37 % Supplemental cash flow information related to leases was as follows (in thousands): Six Months Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating lea ses $ (2,390 ) Operating cash flows used in finance lea ses (1,681 ) Finance cash flows used in finance lea ses (5,475 ) Future minimum lease payments under non-cancelable leases for the six months ending December 31, 2019 and years ending December 31, 2020 , 2021 , 2022 , 2023 , and thereafter are as follows (in thousands): Operating Leases Finance Leases 2019 $ 2,313 $ 6,000 2020 4,793 11,400 2021 4,182 10,960 2022 4,177 10,547 2023 4,201 10,599 Thereafter 9,756 27,715 Total future minimum lease payments 29,422 77,221 Less imputed interest 3,789 10,506 Total $ 25,633 $ 66,715 The following table represents the Company’s commitments under its previous presentation of its capital, operating, and build-to-suit lease agreements as of December 31, 2018 (in thousands): Capital Lease Operating Build-to-Suit Periods ending 2019 $ 4,392 $ 4,904 $ 9,451 2020 1,754 4,783 9,522 2021 481 4,185 10,354 2022 — 4,180 10,520 2023 — 4,205 10,599 Thereafter — 9,760 27,715 Total minimum payments required $ 6,627 $ 32,017 $ 78,161 Amounts representing interest 648 Present value of net minimum payments 5,979 Current maturities 3,884 Long-term payment obligations $ 2,095 |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Note 9—Accrued Expenses Accrued expenses consisted of the following as of the dates indicated (in thousands): As of June 30, As of December 31, Vendor accruals $ 20,315 $ 17,817 Sales and use tax payable 14,013 12,232 Accrued bonus 11,246 12,906 Income tax payable 6,687 10 Payroll-related liabilities 2,604 2,406 Accrued vacation 822 3,787 Total accrued expenses $ 55,687 $ 49,158 |
Debt
Debt | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Note 10—Debt Convertible Debt In March 2018 , the Company issued $345.0 million aggregate principal amount of 0% Convertible Senior Notes due 2023 (the “Notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The net proceeds from the sale of the Notes were $335.0 million after deducting the initial purchasers’ discount and offering expenses. The Company used $34.2 million of the net proceeds from the Notes offering to enter into separate capped call transactions (“Capped Call Transactions”) with the initial purchasers and/or their respective affiliates. During any calendar quarter preceding November 1, 2022 in which the closing price of the Company’s common stock exceeds 130% of the applicable conversion price of the Notes on at least 20 of the last 30 consecutive trading days of the quarter, holders may in the immediate quarter following convert all or a portion of their Notes. Based on the daily closing prices of the Company’s stock during the quarters ended March 31, 2019 and June 30, 2019, holders of the Notes were eligible to convert their Notes during the quarter ended June 30, 2019 and are eligible to convert their Notes during the third quarter of 2019. As of June 30, 2019 , we received a conversion notice for an immaterial principal amount of Notes. When a conversion notice is received, the Company has the option to elect to redeem the shares in cash, common stock or a combination thereof. Accordingly, the Company cannot be required to redeem the Notes in cash and, therefore, the Notes are classified as long-term debt as of June 30, 2019. As of June 30, 2019 , the if-converted value of the Notes was approximately $238.7 million higher than the aggregate principal amount, or $583.7 million , offset in part by the Capped Call Transactions. The Company capitalized $10.0 million of debt issuance costs in connection with the Notes. Non-cash interest expense related to the Notes for the three months ended June 30, 2019 and 2018 was $3.8 million and $3.6 million , respectively. Non-cash interest expense related to the Notes for the six months ended June 30, 2019 and 2018 was $7.5 million and $4.8 million , respectively. Total unamortized debt issuance costs related to the Notes were $5.9 million and $6.7 million as of June 30, 2019 and December 31, 2018 , respectively. The estimated fair value of the Notes was $303.5 million and $279.1 million as of June 30, 2019 and December 31, 2018 , respectively. The estimated fair value of the Notes was determined through consideration of quoted market prices for similar instruments. The fair value is classified as Level 2, as defined in “ Note 6—Fair Value Measurements .” As of June 30, 2019 , there were no other material changes related to the Notes and Capped Call Transactions compared to that disclosed in the Annual Report. Credit Agreement On February 25, 2019 , the Company entered into a $200.0 million senior secured revolving credit facility pursuant to a Credit Agreement (the “ 2019 Credit Agreement ”) with lenders party thereto from time to time, and Citibank N.A., as administrative Agent. The 2019 Credit Agreement will mature in February 2024 . The 2019 Credit Agreement includes a letter of credit sublimit of $30.0 million and a swingline loan sublimit of $10.0 million . Borrowings under the 2019 Credit Agreement (other than swingline loans) bear interest, at the Company’s option, at (i) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 0.50% , and (c) an adjusted LIBOR rate for a one-month interest period plus 1.00% , in each case plus a margin ranging from 0.25% to 0.875% or (ii) an adjusted LIBOR rate plus a margin ranging from 1.25% to 1.875% . Swingline loans under the 2019 Credit Agreement bear interest at the same base rate (plus the margin applicable to borrowings bearing interest at the base rate). These margins are determined based on the senior secured net leverage ratio (defined as secured funded debt, net of unrestricted cash up to $100 million , to EBITDA) for the preceding four fiscal quarter period. The Company is also obligated to pay other customary fees for a credit facility of this size and type, including an unused commitment fee, ranging from 0.20% to 0.35% depending on the Company’s senior secured net leverage ratio, and fees associated with letters of credit. The 2019 Credit Agreement also permits the Company, in certain circumstances, to request an increase in the facility by an amount of up to $100.0 million at the same maturity, pricing and other terms and to request an extension of the maturity date for the facility. In connection with the 2019 Credit Agreement , the Company also paid the lenders certain upfront fees. The 2019 Credit Agreement contains customary representations and warranties applicable to the Company and its subsidiaries and customary affirmative and negative covenants applicable to the Company and its restricted subsidiaries. The negative covenants include restrictions on, among other things, indebtedness, liens, certain fundamental changes (including mergers), investments, dispositions, restricted payments (including dividends and stock repurchases), prepayments of junior debt, and transactions with affiliates. These restrictions do not prohibit a subsidiary of the Company from making pro rata payments to the Company or any other person that owns an equity interest in such subsidiary. The 2019 Credit Agreement contains financial covenants, that require the Company and its subsidiaries to maintain (i) a secured net leverage ratio not to exceed 3.00 to 1.00 , subject to an increase, at the option of the Company, to 3.50 to 1.00 for a specified period of time in the event of certain material acquisitions, tested as of the last day of each fiscal quarter and (ii) an interest coverage ratio (defined as the ratio of EBITDA to cash interest expense) of not less than 2.50 to 1.00 , tested for each fiscal quarter. The 2019 Credit Agreement includes customary events of default, including, but not limited to, nonpayment of principal or interest, breaches of representations and warranties, failure to perform or observe covenants, cross-defaults with certain other indebtedness, final judgments or orders, certain change of control events, and certain bankruptcy-related events or proceedings. Upon the occurrence of an event of default (subject to notice and grace periods), obligations under the 2019 Credit Agreement could be accelerated. Subject to certain exceptions, to the extent the Company has any material domestic subsidiaries, the obligations under the 2019 Credit Agreement would be required to be guaranteed by such material domestic subsidiaries. The obligations under the 2019 Credit Agreement are secured by all or substantially all of the assets of the Company and any such subsidiary guarantors. The Company capitalized $1.4 million of debt issuance costs in connection with the 2019 Credit Agreement . Non-cash interest expense related to debt issuance costs on the 2019 Credit Agreement for the three and six months ended June 30, 2019 was $0.1 million and $0.1 million , respectively. Total unamortized debt issuance costs related to the 2019 Credit Agreement were $1.3 million as of June 30, 2019 . At June 30, 2019 , the Company did no t have any borrowings under the 2019 Credit Agreement and was in compliance with all financial covenants. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11—Commitments and Contingencies Legal Proceedings From time to time in the normal course of business, various claims and litigation have been asserted or commenced against the Company. Due to uncertainties inherent in litigation and other claims, the Company can give no assurance that it will prevail in any such matters, which could subject the Company to significant liability for damages. Any claims or litigation, regardless of their success, could have an adverse effect on the Company’s Consolidated Results of Operations, Cash Flows, or business and financial condition in the period the claims or litigation are resolved. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | Note 12—Stockholders’ Equity On November 1, 2018, the Board of Directors approved a stock repurchase program that enables the Company to repurchase up to $200 million of its common stock. The program does not have a time limit and may be modified, suspended or terminated at any time by the Board of Directors. The number of shares repurchased and the timing of repurchases will depend on a number of factors, including, but not limited to, stock price, trading volume and general market conditions, along with Etsy’s working capital requirements, general business conditions and other factors. In November 2017, the Board of Directors approved a stock repurchase program that enabled the Company to repurchase up to $100 million of its common stock. The program was completed in the second quarter of 2018. Under the stock repurchase program, the Company was able to purchase shares of its common stock through various means, including open market transactions, privately negotiated transactions, tender offers, or any combination thereof. In addition, open market repurchases of common stock could be made pursuant to trading plans established pursuant to Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, which permitted common stock to be repurchased at a time that the Company might otherwise be precluded from doing so under insider trading laws or self-imposed trading restrictions. The following table summarizes the Company’s cumulative share repurchase activity of both programs noted above, excluding shares withheld to satisfy tax withholding obligations in connection with the vesting of employee restricted stock units (in thousands except share and per share amounts): Shares Repurchased Average Price Paid per Share (1) Value of Shares Repurchased (1) Remaining Amount Authorized Balance as of December 31, 2018 5,032,648 $ 28.80 $ 145,000 $ 155,000 Repurchases of common stock for the three months ended: March 31, 2019 532,412 51.64 27,500 (27,500 ) June 30, 2019 — — — — Balance as of June 30, 2019 5,565,060 $ 32.84 $ 172,500 $ 127,500 (1) Average price paid per share excludes broker commissions. Value of shares repurchased includes broker commissions. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note 13—Stock-Based Compensation During the three and six months ended June 30, 2019 , the Company granted stock options and restricted stock units (“RSUs”) under its 2015 Equity Incentive Plan (“2015 Plan”) and, pursuant to the evergreen increase provision of the 2015 Plan, the Board of Directors approved an increase of 2,395,434 shares to the total number of shares available for issuance under the 2015 Plan effective as of January 2, 2019. At June 30, 2019 , 31,831,808 shares were authorized under the 2015 Plan and 20,697,053 shares were available for future grant. The fair value of options granted in the periods presented below using the Black-Scholes pricing model has been based on the following assumptions: Three Months Ended Six Months Ended 2019 2018 2019 2018 Volatility 39.2% - 39.5% 38.6% - 42.1% 39.2% - 39.5% 38.6% - 42.1% Risk-free interest rate 1.9% - 2.4% 2.8% - 2.9% 1.9% - 2.5% 2.6% - 2.9% Expected term (in years) 5.5 - 6.16 5.5 - 6.08 5.5 - 6.16 5.5 - 6.25 Dividend rate —% —% —% —% The following table summarizes the activity for the Company’s options during the six months ended June 30, 2019 (in thousands except share and per share amounts): Shares Weighted-Average Exercise Price Weighted-Average Remaining Contract Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2018 6,890,994 $ 12.91 Granted 320,888 68.84 Exercised (688,890 ) 11.38 Forfeited/Canceled (186,644 ) 28.31 Outstanding at June 30, 2019 6,336,348 15.46 7.62 $ 293,334 Total exercisable at June 30, 2019 3,256,827 11.65 7.13 161,917 The following table summarizes the weighted-average grant date fair value of options granted, intrinsic value of options exercised and fair value of awards vested during the three and six months ended June 30, 2019 and 2018 (in thousands except per share amounts): Three Months Ended Six Months Ended 2019 2018 2019 2018 Weighted-average grant date fair value of options granted $ 25.00 $ 13.51 $ 28.90 $ 12.50 Intrinsic value of options exercised 8,373 1,397 36,896 11,196 Fair value of awards vested 12,108 11,469 18,191 14,399 The total unrecognized compensation expense at June 30, 2019 related to the Company’s options was $24.5 million , which will be recognized over an estimated weighted-average amortization period of 2.69 years. The following table summarizes the activity for the Company’s unvested RSUs during the six months ended June 30, 2019 : Shares Weighted-Average Unvested at December 31, 2018 3,480,368 $ 22.87 Granted 868,828 67.48 Vested (680,661 ) 18.65 Forfeited/Canceled (385,591 ) 26.96 Unvested at June 30, 2019 3,282,944 35.07 The total unrecognized compensation expense at June 30, 2019 related to the Company’s unvested RSUs was $103.4 million , which will be recognized over an estimated weighted-average amortization period of 3.26 years. Total stock-based compensation expense included in the Consolidated Statements of Operations for the periods presented below is as follows (in thousands): Three Months Ended Six Months Ended 2019 2018 2019 2018 Cost of revenue $ 1,456 $ 927 $ 2,555 $ 1,473 Marketing 723 699 1,354 1,177 Product development 5,294 4,025 8,813 6,664 General and administrative 3,364 2,966 6,197 5,757 Total stock-based compensation expense $ 10,837 $ 8,617 $ 18,919 $ 15,071 Total stock-based compensation expense in the three months ended June 30, 2019 and 2018 includes $0.4 million and $0.7 million in acquisition-related stock-based compensation expense, respectively. Total stock-based compensation expense in the six months ended June 30, 2019 and 2018 includes $0.7 million and $1.4 million in acquisition-related stock-based compensation expense, respectively. |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Event | Subsequent Event On July 21, 2019, the Company entered into a definitive merger agreement to acquire Reverb Holdings Inc., a privately held marketplace for new, used, and vintage music gear. Pursuant to the merger agreement, the Company will acquire all of the outstanding capital stock of Reverb for $275 million in cash, subject to certain adjustments with respect to cash, debt, working capital, transaction expenses and the value of equity awards granted in connection with the transaction. The transaction is expected to close in late third quarter or early fourth quarter of 2019, subject to Hart-Scott-Rodino review and other customary closing conditions. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Consolidation | Basis of Consolidation The Consolidated Financial Statements include the accounts of Etsy and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. |
Unaudited Interim Financial Information | Unaudited Interim Financial Information The accompanying Consolidated Balance Sheet as of June 30, 2019 , the Consolidated Statements of Operations and Comprehensive Income for the three and six months ended June 30, 2019 and 2018 , the Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2019 and 2018 and the Consolidated Statement of Changes in Stockholders’ Equity for the three and six months ended June 30, 2019 and 2018 are unaudited. The unaudited interim financial statements have been prepared on the same basis as the annual Consolidated Financial Statements except for new accounting standards adopted as disclosed below, and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the Company’s financial position as of June 30, 2019 , results of operations for the three and six months ended June 30, 2019 and 2018 and cash flows for the six months ended June 30, 2019 and 2018 . The results for these interim periods are not necessarily indicative of the results to be anticipated for the full annual period or any future period. The financial data and the other information disclosed in these Notes to the Consolidated Financial Statements related to these three and six month periods are unaudited. These unaudited interim financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 28, 2019 (the “Annual Report”). During the first quarter of 2019, the Company adopted the accounting principles outlined within ASU 2016-02 —Leases, as described below . There have been no additional material changes in the Company’s significant accounting policies from those that were disclosed in the Annual Report. |
Use of Estimates | Use of Estimates The preparation of the Company’s Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets, liabilities, and equity at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The accounting estimates that require management’s most difficult and subjective judgments include: revenue recognition, determining the nature and timing of satisfaction of performance obligations and stand-alone selling price for use in allocating the subscription price of Etsy Plus; leases, determining the incremental borrowing rate; income taxes, including the estimate of annual effective tax rate at interim periods, assessment of valuation allowances, and evaluation of uncertain tax positions; website development costs and internal-use software; purchase price allocations for business combinations and contingent consideration; valuation of goodwill and intangible assets; stock-based compensation; and fair value of financial instruments . The Company evaluates its estimates and judgments on an ongoing basis and revises them when necessary. Actual results may differ from the original or revised estimates. |
Revenue Recognition | Revenue Recognition The Company’s revenue is diversified; generated from a mix of marketplace activities and other optional services to help Etsy sellers generate more sales and scale their businesses. Revenues are recognized as the Company transfers control of promised goods or services to Etsy sellers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company evaluates whether it is appropriate to recognize revenue on a gross or net basis based upon its evaluation of whether the Company obtains control of the specified goods or services by considering if it is primarily responsible for fulfillment of the promise, has inventory risk, and has the latitude in establishing pricing and selecting suppliers, among other factors. Based on its evaluation of these factors, revenue is recorded either gross or net of costs associated with the transaction. With the exception of Etsy Shipping Labels, the Company’s revenues are recognized on a gross basis. Sales and usage-based taxes are excluded from revenues. See “ Note 2—Revenue ” for additional information regarding revenue recognition. |
Income Taxes | Income Taxes The Company’s income tax (provision) benefit for interim periods is determined using an estimate of its annual effective tax rate adjusted for discrete items, if any, for relevant interim periods. The Company updates its estimate of the annual effective tax rate each quarter and makes cumulative adjustments if its estimated annual tax rate changes. The Company’s quarterly tax provision and quarterly estimate of its annual effective tax rate are subject to significant variations due to several factors, including variability in predicting its pretax and taxable income and the mix of jurisdictions to which those relate, changes of expenses or losses for which tax benefits are not recognized, recording of excess tax benefits related to stock-based compensation and changes in the laws, regulations, and administrative practices of the jurisdictions in which the Company operates. |
Net Income Per Share | Net Income Per Share Basic net income per share attributable to common stockholders is computed by dividing the net income attributable to common stockholders by the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed by dividing net income for the period by the weighted-average number of shares of common stock and potentially dilutive common stock outstanding during the period. Net income in the diluted net income per share calculation is adjusted for income or loss from fair value adjustments on instruments accounted for as liabilities, but which may be settled in shares. The dilutive effect of outstanding options and stock-based compensation awards is reflected in diluted net income per share by application of the treasury stock method. Since the Company expects to settle in cash the principal outstanding under the 0% Convertible Senior Notes due 2023 the Company issued in March 2018 (the “Notes,” see “ Note 10—Debt ”), it uses the treasury stock method when calculating the potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have a dilutive impact on diluted net income per share of common stock when the average market price of the Company’s common stock for a given period exceeds the conversion price of $36.27 per share. The calculation of diluted net income per share excludes all anti-dilutive common shares. |
Cash and Cash Equivalents, Short- and Long-term Investments | Cash and Cash Equivalents, and Short- and Long-term Investments The Company considers all investments with an original maturity of three months or less at time of purchase to be cash equivalents. Cash restricted by third parties is not considered cash and cash equivalents. Short-term investments, consisting primarily of commercial paper, United States government and agency securities, and corporate bonds with original maturities of greater than three months but less than one year when purchased, are classified as available-for-sale and are reported at fair value using the specific identification method. Long-term investments, consisting primarily of corporate bonds with original maturities of greater than twelve months but less than 37 months when purchased, are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated income tax provisions or benefits. |
Leases | Leases At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present. Operating leases are included in other assets, other current liabilities, and other liabilities on the Company’s Consolidated Balance Sheets. Finance leases are included in property and equipment, net, finance lease obligations, current, and finance lease obligations, net of current portion on the Company’s Consolidated Balance Sheets. Most leases with a term greater than one year are recognized on the Consolidated Balance Sheet as right-of-use (“ROU”) assets, lease obligations and, if applicable, long-term lease obligations in the line items cited above. The Company has elected not to recognize leases with terms of one year or less on the Consolidated Balance Sheets. Lease obligations and their corresponding ROU assets are recorded based on the present value of lease payments over the expected lease term. As the interest rate implicit in lease contracts is typically not readily determinable, the Company utilizes the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. Certain adjustments to the ROU asset may be required for items such as initial direct costs paid or incentives received. The lease term may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The components of a lease should be split into three categories: lease components, including land, building, or other similar components; non-lease components, including common area maintenance, maintenance, consumables, or other similar components; and non-components, including property taxes, insurance, or other similar components. However, the Company has elected to combine lease and non-lease components as a single component. The lease expense is recognized over the expected term on a straight-line basis. |
Recently Issued and Recently Adopted Accounting Pronouncements | Recently Issued Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13 —Financial Instruments—Credit Losses (Topic 326)—Measurement of Credit Losses on Financial Instruments , and additional changes, modifications, clarifications, or interpretations related to this guidance thereafter, which require a reporting entity to estimate credit losses on certain types of financial instruments, and present assets held at amortized cost and available-for-sale debt securities at the amount expected to be collected. The new guidance is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its Consolidated Financial Statements. In August 2018, the FASB issued ASU 2018-15 —Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40)—Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The new guidance is effective for annual and interim periods beginning after December 15, 2019, and early adoption is permitted. The Company is currently evaluating the impact of the new guidance on its Consolidated Financial Statements. Recently Adopted Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02 —Leases (Topic 842), and additional changes, modifications, clarifications, or interpretations related to this guidance thereafter, which require a reporting entity to recognize ROU assets and lease liabilities on the balance sheet for operating leases to increase the transparency and comparability. Disclosure requirements have been enhanced with the objective of enabling financial statement users to assess the amount, timing, and uncertainty of cash flows arising from leases. The Company adopted this standard in the first quarter of 2019, effective as of January 1, 2019, using the modified retrospective approach utilizing transition guidance introduced in ASU 2018-11— Leases: Targeted Improvements , and elected the ‘package of practical expedients’ permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward the historical lease identification, classification, and initial direct costs. The Company did not elect the hindsight practical expedient which permits entities to use hindsight in determining the lease term and assessing impairment. The Company also elected to continue to recognize lease payments related to short-term leases as an expense on a straight-line basis over the lease term. Upon adoption, the Company recognized new ROU assets and lease obligations on the Consolidated Balance Sheet for our operating leases of $25.4 million and $27.8 million , respectively. Additionally, upon adoption the Company renamed its capital lease obligations, current and capital lease obligations, net of current to finance lease obligations, current and finance lease obligations, net of current portion, respectively, in the Consolidated Balance Sheets. In 2014 the Company applied build-to-suit accounting treatment to its headquarters lease in Brooklyn, New York, as the Company was deemed the accounting owner of the construction project because of the Company’s involvement in the build-out of the space. Upon transition, the Company derecognized the facility financing obligation and related building assets recorded as a result of the failed sale and leaseback transactions and recorded any difference as a cumulative-effect adjustment to accumulated deficit. The adoption of this standard had a material impact on the Company’s financial position but did not and is not expected to significantly affect the Company’s results of operations. The Company has derecognized the existing facility financing obligation and existing building asset for sale-leaseback transactions that currently do not qualify for sale accounting of $60.0 million and $51.1 million , respectively, and $22.1 million was reclassified from building to leasehold improvements and will be amortized over the remaining term of the lease. The Company recognized a gain of $9.3 million , offset by a tax impact of $2.2 million associated with this change through accumulated deficit as of January 1, 2019, with a net decrease to accumulated deficit of $7.1 million , and recognized a new ROU asset of $66.7 million |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Cash, Cash Equivalents and Short-term Investments | The following table provides cash and cash equivalents, and short- and long-term investments within the Consolidated Balance Sheets as of the dates indicated (in thousands): As of As of Cash and cash equivalents $ 359,159 $ 366,985 Short-term investments 274,673 257,302 Long-term investments 25,438 — Total cash and cash equivalents, and short- and long-term investments $ 659,270 $ 624,287 |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table summarizes revenue by type of service for the periods presented (in thousands): Three Months Ended Six Months Ended 2019 2018 2019 2018 Marketplace revenue $ 134,403 $ 91,306 $ 260,533 $ 179,273 Services revenue 45,896 39,507 88,067 72,112 Other revenue 796 1,574 1,834 1,914 Revenue $ 181,095 $ 132,387 $ 350,434 $ 253,299 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Basic and Diluted Net (Loss) Income Per Share | The following table presents the calculation of basic and diluted net income per share for periods presented (in thousands except share and per share amounts): Three Months Ended Six Months Ended 2019 2018 2019 2018 Numerator: Net inco me $ 18,223 $ 3,379 $ 49,802 $ 16,346 Net income allocated to participating securities under the two-class method (9 ) (3 ) (24 ) (16 ) Net inco me applicable to common stockholde rs—basic 18,214 3,376 49,778 16,330 Dilutive effect of net income allocated to participating securities under the two-class method 9 3 24 16 Net income attributable to common stockholders—diluted $ 18,223 $ 3,379 $ 49,802 $ 16,346 Denominator: Weighted-average common shares outstanding—basic (1) 120,198,526 119,450,194 119,848,289 120,819,201 Dilutive effect of assumed conversion of options to purchase common stock 4,667,849 3,964,746 4,764,942 3,559,951 Dilutive effect of assumed conversion of restricted stock units 1,693,130 2,053,861 1,841,363 1,733,777 Dilutive effect of assumed conversion of convertible debt 4,226,839 — 3,989,402 — Dilutive effect of assumed conversion of restricted stock from acquisition 21,399 82,958 19,029 73,735 Weighted-average common shares outstanding—diluted 130,807,743 125,551,759 130,463,025 126,186,664 Net inco me per share attributable to common stockholders—b asic $ 0.15 $ 0.03 $ 0.42 $ 0.14 Net income per share a ttri butable to common stockholders—diluted $ 0.14 $ 0.03 $ 0.38 $ 0.13 (1) 22,993 and 23,759 shares of unvested stock are considered participating securities and are excluded from basic shares outstanding for the three and six months ended June 30, 2019 , respectively. |
Schedule of Anti-Dilutive Securities Excluded from Computation of Net Income Per Share | The following potential common shares were excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Three Months Ended Six Months Ended 2019 2018 2019 2018 Stock options 337,907 642,418 224,706 421,412 Restricted stock units 716,869 118,209 424,461 1,054,803 Total anti-dilutive securities 1,054,776 760,627 649,167 1,476,215 |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Geographic Area | The following table summarizes revenue, (loss) income before income taxes , and net (loss) income by geographic area for the periods presented (in thousands): Three Months Ended Six Months Ended 2019 2018 2019 2018 United States $ 119,670 $ 96,805 $ 232,934 $ 181,728 International 61,425 35,582 117,500 71,571 Revenue $ 181,095 $ 132,387 $ 350,434 $ 253,299 United States (1) $ (11,897 ) $ 8,017 $ (6,902 ) $ 5,752 International (2) 28,266 (3,392 ) 54,708 11,854 (Loss) income before income taxes $ 16,369 $ 4,625 $ 47,806 $ 17,606 United States (1) $ (6,146 ) $ 7,525 $ 2,546 $ 5,507 International (2) 24,369 (4,146 ) 47,256 10,839 Net (loss) income $ 18,223 $ 3,379 $ 49,802 $ 16,346 (1) The United States loss before income taxes in the three and six months ended June 30, 2019 and the net loss in the three months ended June 30, 2019 was primarily driven by a majority of operating expenses being incurred in the United States. (2) The International loss before income taxes and net loss in the three months ended June 30, 2018 was primarily driven by a foreign exchange loss related to the U.S. Dollar to Euro exchange rate fluctuations on the Company's intercompany and other non-functional currency balances. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Major Categories of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following are the major categories of assets measured at fair value on a recurring basis as of June 30, 2019 and December 31, 2018 (in thousands): As of June 30, 2019 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 272,246 $ — $ — $ 272,246 272,246 — — 272,246 Short-term investments: Commercial paper — 79,028 — 79,028 Corporate bonds — 83,924 — 83,924 U.S. Government and agency securities 111,721 — — 111,721 111,721 162,952 — 274,673 Funds receivable and seller accounts: Money market funds 20,308 — — 20,308 20,308 — — 20,308 Long-term investments: Corporate bonds — 25,438 — 25,438 — 25,438 — 25,438 $ 404,275 $ 188,390 $ — $ 592,665 As of December 31, 2018 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Commercial paper $ — $ 7,775 $ — $ 7,775 Money market funds 244,856 — — 244,856 244,856 7,775 — 252,631 Short-term investments: Commercial paper — 147,860 — 147,860 Corporate bonds — 46,801 — 46,801 U.S. Government and agency securities 62,641 — — 62,641 62,641 194,661 — 257,302 Funds receivable and seller accounts: Money market funds 9,229 — — 9,229 9,229 — — 9,229 $ 316,726 $ 202,436 $ — $ 519,162 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Cost and Fair Value of Available-for-sale Securities | The cost and fair value of available-for-sale securities were as follows as of the dates indicated (in thousands): Cost Gross Gross Fair Value June 30, 2019 Short-term investments: Commercial paper $ 79,028 $ — $ — $ 79,028 Corporate bonds 83,778 — 146 83,924 U.S. Government and agency securities 111,575 — 146 111,721 274,381 — 292 274,673 Long-term investments: Corporate bonds 25,296 — 142 25,438 25,296 — 142 25,438 $ 299,677 $ — $ 434 $ 300,111 December 31, 2018 Cash equivalents: Commercial paper $ 7,775 $ — $ — $ 7,775 7,775 — — 7,775 Short-term investments: Commercial paper 147,860 — — 147,860 Corporate bonds 46,836 (35 ) — 46,801 U.S. Government and agency securities 62,638 (9 ) 12 62,641 257,334 (44 ) 12 257,302 $ 265,109 $ (44 ) $ 12 $ 265,077 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Schedule of Lease Expense, Weighted Averages and Supplemental Cash Flow Information | The elements of lease expense were as follows (in thousands): Three Months Ended Six Months Ended Operating lease cost $ 1,272 $ 2,550 Finance lease cost: Amortization of right-of-use assets 3,320 6,690 Interest on lease liabilities 823 1,693 Total finance lease cost 4,143 8,383 Other lease cost, net (1) 126 68 Total lease cost $ 5,541 $ 11,001 (1) Other lease cost, net includes short-term sublease income, short-term lease costs, and variable lease costs, which are immaterial. The following table presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheet (in thousands): As of June 30, 2019 Operating leases: Other assets $ 23,410 Other current liabilities $ 3,995 Other liabilities 21,638 Total operating lease liabilities $ 25,633 Finance leases: Property and equipment, net $ 65,621 Finance lease obligations—current $ 9,306 Finance lease obligations—net of current portion 57,409 Total finance lease liabilities $ 66,715 The following table summarizes the weighted average remaining lease term and weighted average discount rate as of June 30, 2019 : As of June 30, 2019 Weighted average remaining lease term: Operating leases 6.52 years Finance leases 6.75 years Weighted average discount rate: Operating leases 4.26 % Finance leases 4.37 % |
Schedule of Cash Flow Activities, Lessee | Supplemental cash flow information related to leases was as follows (in thousands): Six Months Ended Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating lea ses $ (2,390 ) Operating cash flows used in finance lea ses (1,681 ) Finance cash flows used in finance lea ses (5,475 ) |
Schedule of Future Minimum Operating Lease Payments | Future minimum lease payments under non-cancelable leases for the six months ending December 31, 2019 and years ending December 31, 2020 , 2021 , 2022 , 2023 , and thereafter are as follows (in thousands): Operating Leases Finance Leases 2019 $ 2,313 $ 6,000 2020 4,793 11,400 2021 4,182 10,960 2022 4,177 10,547 2023 4,201 10,599 Thereafter 9,756 27,715 Total future minimum lease payments 29,422 77,221 Less imputed interest 3,789 10,506 Total $ 25,633 $ 66,715 |
Schedule of Future Minimum Finance Lease Payments | Future minimum lease payments under non-cancelable leases for the six months ending December 31, 2019 and years ending December 31, 2020 , 2021 , 2022 , 2023 , and thereafter are as follows (in thousands): Operating Leases Finance Leases 2019 $ 2,313 $ 6,000 2020 4,793 11,400 2021 4,182 10,960 2022 4,177 10,547 2023 4,201 10,599 Thereafter 9,756 27,715 Total future minimum lease payments 29,422 77,221 Less imputed interest 3,789 10,506 Total $ 25,633 $ 66,715 |
Schedule of Commitments Under Previous Presentation | The following table represents the Company’s commitments under its previous presentation of its capital, operating, and build-to-suit lease agreements as of December 31, 2018 (in thousands): Capital Lease Operating Build-to-Suit Periods ending 2019 $ 4,392 $ 4,904 $ 9,451 2020 1,754 4,783 9,522 2021 481 4,185 10,354 2022 — 4,180 10,520 2023 — 4,205 10,599 Thereafter — 9,760 27,715 Total minimum payments required $ 6,627 $ 32,017 $ 78,161 Amounts representing interest 648 Present value of net minimum payments 5,979 Current maturities 3,884 Long-term payment obligations $ 2,095 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued expenses consisted of the following as of the dates indicated (in thousands): As of June 30, As of December 31, Vendor accruals $ 20,315 $ 17,817 Sales and use tax payable 14,013 12,232 Accrued bonus 11,246 12,906 Income tax payable 6,687 10 Payroll-related liabilities 2,604 2,406 Accrued vacation 822 3,787 Total accrued expenses $ 55,687 $ 49,158 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Equity [Abstract] | |
Class of Treasury Stock | The following table summarizes the Company’s cumulative share repurchase activity of both programs noted above, excluding shares withheld to satisfy tax withholding obligations in connection with the vesting of employee restricted stock units (in thousands except share and per share amounts): Shares Repurchased Average Price Paid per Share (1) Value of Shares Repurchased (1) Remaining Amount Authorized Balance as of December 31, 2018 5,032,648 $ 28.80 $ 145,000 $ 155,000 Repurchases of common stock for the three months ended: March 31, 2019 532,412 51.64 27,500 (27,500 ) June 30, 2019 — — — — Balance as of June 30, 2019 5,565,060 $ 32.84 $ 172,500 $ 127,500 (1) Average price paid per share excludes broker commissions. Value of shares repurchased includes broker commissions. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Black-Scholes Valuation Assumptions Used to Determine Fair Value of Options Granted | The fair value of options granted in the periods presented below using the Black-Scholes pricing model has been based on the following assumptions: Three Months Ended Six Months Ended 2019 2018 2019 2018 Volatility 39.2% - 39.5% 38.6% - 42.1% 39.2% - 39.5% 38.6% - 42.1% Risk-free interest rate 1.9% - 2.4% 2.8% - 2.9% 1.9% - 2.5% 2.6% - 2.9% Expected term (in years) 5.5 - 6.16 5.5 - 6.08 5.5 - 6.16 5.5 - 6.25 Dividend rate —% —% —% —% |
Summary of Stock Option Activity | The following table summarizes the activity for the Company’s options during the six months ended June 30, 2019 (in thousands except share and per share amounts): Shares Weighted-Average Exercise Price Weighted-Average Remaining Contract Term (in years) Aggregate Intrinsic Value Outstanding at December 31, 2018 6,890,994 $ 12.91 Granted 320,888 68.84 Exercised (688,890 ) 11.38 Forfeited/Canceled (186,644 ) 28.31 Outstanding at June 30, 2019 6,336,348 15.46 7.62 $ 293,334 Total exercisable at June 30, 2019 3,256,827 11.65 7.13 161,917 |
Summary of Intrinsic Value of Options Exercised | The following table summarizes the weighted-average grant date fair value of options granted, intrinsic value of options exercised and fair value of awards vested during the three and six months ended June 30, 2019 and 2018 (in thousands except per share amounts): Three Months Ended Six Months Ended 2019 2018 2019 2018 Weighted-average grant date fair value of options granted $ 25.00 $ 13.51 $ 28.90 $ 12.50 Intrinsic value of options exercised 8,373 1,397 36,896 11,196 Fair value of awards vested 12,108 11,469 18,191 14,399 |
Summary of Weighted Average Grant Date Fair Value and Fair Value of Awards Vested | The following table summarizes the weighted-average grant date fair value of options granted, intrinsic value of options exercised and fair value of awards vested during the three and six months ended June 30, 2019 and 2018 (in thousands except per share amounts): Three Months Ended Six Months Ended 2019 2018 2019 2018 Weighted-average grant date fair value of options granted $ 25.00 $ 13.51 $ 28.90 $ 12.50 Intrinsic value of options exercised 8,373 1,397 36,896 11,196 Fair value of awards vested 12,108 11,469 18,191 14,399 |
Summary of Unvested RSU Activity | The following table summarizes the activity for the Company’s unvested RSUs during the six months ended June 30, 2019 : Shares Weighted-Average Unvested at December 31, 2018 3,480,368 $ 22.87 Granted 868,828 67.48 Vested (680,661 ) 18.65 Forfeited/Canceled (385,591 ) 26.96 Unvested at June 30, 2019 3,282,944 35.07 |
Schedule of Stock-Based Compensation Expense | Total stock-based compensation expense included in the Consolidated Statements of Operations for the periods presented below is as follows (in thousands): Three Months Ended Six Months Ended 2019 2018 2019 2018 Cost of revenue $ 1,456 $ 927 $ 2,555 $ 1,473 Marketing 723 699 1,354 1,177 Product development 5,294 4,025 8,813 6,664 General and administrative 3,364 2,966 6,197 5,757 Total stock-based compensation expense $ 10,837 $ 8,617 $ 18,919 $ 15,071 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 01, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Mar. 31, 2018 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Revenue | $ 181,095 | $ 132,387 | $ 350,434 | $ 253,299 | |||
Cost of revenue | 58,605 | 45,409 | 111,263 | $ 86,704 | |||
Operating lease right-of-use assets, net of current | 23,410 | 23,410 | |||||
Operating lease, liability | 25,633 | 25,633 | |||||
Derecognized existing facility financing obligation | 0 | 0 | $ (59,991) | ||||
Property and equipment, net reclassified | 128,409 | 128,409 | $ 120,179 | ||||
Cumulative effect adjustment related to the adoption of the leasing standard | $ 7,116 | ||||||
Finance lease, right-of-use asset | 65,621 | 65,621 | |||||
Finance lease, liability | $ 66,715 | $ 66,715 | |||||
Accounting Standards Update 2016-02 | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Operating lease right-of-use assets, net of current | 25,400 | ||||||
Operating lease, liability | 27,800 | ||||||
Derecognized existing facility financing obligation | 60,000 | ||||||
Property and equipment, net reclassified | (51,100) | ||||||
Cumulative effect of new accounting principle in period of adoption, gain recognized | (9,300) | ||||||
Cumulative effect of new accounting principle in period of adoption, tax impact | (2,200) | ||||||
Finance lease, right-of-use asset | 66,700 | ||||||
Convertible Debt | Convertible Senior Notes due 2023 | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Interest rate, stated percentage | 0.00% | ||||||
Conversion price (in dollars per share) | $ 36.27 | ||||||
Building | Accounting Standards Update 2016-02 | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Property and equipment, net reclassified | (22,100) | ||||||
Leasehold improvements | Accounting Standards Update 2016-02 | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Property and equipment, net reclassified | 22,100 | ||||||
Finance lease, liability | 66,700 | ||||||
Accumulated Deficit | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Cumulative effect adjustment related to the adoption of the leasing standard | 7,116 | ||||||
Accumulated Deficit | Accounting Standards Update 2016-02 | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Cumulative effect adjustment related to the adoption of the leasing standard | $ 7,100 | ||||||
Restatement Adjustment | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Revenue | 2,800 | ||||||
Cost of revenue | $ 1,400 |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Cash, Cash Equivalents and Short-term Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 359,159 | $ 366,985 | $ 357,820 | $ 315,442 |
Short-term investments | 274,673 | 257,302 | ||
Long-term investments | 25,438 | 0 | ||
Total cash, cash equivalents and short-term investments | $ 659,270 | $ 624,287 |
Revenue - Summary of Revenue by
Revenue - Summary of Revenue by Type (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 181,095 | $ 132,387 | $ 350,434 | $ 253,299 |
Marketplace revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 134,403 | 91,306 | 260,533 | 179,273 |
Services revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 45,896 | 39,507 | 88,067 | 72,112 |
Other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 796 | $ 1,574 | $ 1,834 | $ 1,914 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jul. 15, 2018 | Jun. 30, 2019 | |
Revenue from External Customer [Line Items] | |||
Revenue recognized in the period | $ 7,500,000 | ||
Marketplace revenue | |||
Revenue from External Customer [Line Items] | |||
Listing fee per item | $ 0.20 | ||
Listing fee, term | 4 months | ||
Fee for each completed transaction, percent | 3.50% | 5.00% | |
Marketplace revenue | Minimum | |||
Revenue from External Customer [Line Items] | |||
Etsy payment fees, percent | 3.00% | ||
Marketplace revenue | Maximum | |||
Revenue from External Customer [Line Items] | |||
Etsy payment fees, percent | 4.50% | ||
Pattern | |||
Revenue from External Customer [Line Items] | |||
Subscription fee per month | $ 15 | ||
Etsy Plus | |||
Revenue from External Customer [Line Items] | |||
Subscription fee per month | $ 10 | ||
Subscription period | 30 days |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | ||
Unrecognized tax benefits, period increase | $ 1 | |
Unrecognized tax benefits | 19.8 | $ 18.8 |
Unrecognized tax benefits that would impact effective tax rate favorably | 19.8 | |
Income tax penalties and interest expense | 0.3 | |
Income tax penalties and interest accrued | $ 0.8 | $ 0.5 |
Net Income Per Share - Calculat
Net Income Per Share - Calculation of Basic and Diluted Net (Loss) Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Numerator: | ||||||
Net income | $ 18,223 | $ 31,579 | $ 3,379 | $ 12,967 | $ 49,802 | $ 16,346 |
Net income allocated to participating securities under the two-class method | (9) | (3) | (24) | (16) | ||
Net income applicable to common stockholders—basic | 18,214 | 3,376 | 49,778 | 16,330 | ||
Dilutive effect of net income allocated to participating securities under the two-class method | 9 | 3 | 24 | 16 | ||
Net income attributable to common stockholders—diluted | $ 18,223 | $ 3,379 | $ 49,802 | $ 16,346 | ||
Denominator: | ||||||
Weighted average common shares outstanding—basic (in shares) | 120,198,526 | 119,450,194 | 119,848,289 | 120,819,201 | ||
Weighted average common shares outstanding - diluted (in shares) | 130,807,743 | 125,551,759 | 130,463,025 | 126,186,664 | ||
Net income per share applicable to common stockholders—basic (in dollars per shares) | $ 0.15 | $ 0.03 | $ 0.42 | $ 0.14 | ||
Net income per share applicable to common stockholders—diluted (in dollars per share) | $ 0.14 | $ 0.03 | $ 0.38 | $ 0.13 | ||
Participating securities excluded from computation of earnings per share (in shares) | 1,054,776 | 760,627 | 649,167 | 1,476,215 | ||
Participating Securities | ||||||
Denominator: | ||||||
Participating securities excluded from computation of earnings per share (in shares) | 22,993 | 23,759 | ||||
Stock Options | ||||||
Denominator: | ||||||
Dilutive effect of assumed conversion (in shares) | 4,667,849 | 3,964,746 | 4,764,942 | 3,559,951 | ||
Restricted stock units | ||||||
Denominator: | ||||||
Dilutive effect of assumed conversion (in shares) | 1,693,130 | 2,053,861 | 1,841,363 | 1,733,777 | ||
Convertible Debt | ||||||
Denominator: | ||||||
Dilutive effect of assumed conversion (in shares) | 4,226,839 | 0 | 3,989,402 | 0 | ||
Restricted Stock | ||||||
Denominator: | ||||||
Dilutive effect of assumed conversion (in shares) | 21,399 | 82,958 | 19,029 | 73,735 |
Net Income Per Share - Summary
Net Income Per Share - Summary of Shares Excluded from the Calculation of Diluted Net (Loss) Income Per Share (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of earnings per share (in shares) | 1,054,776 | 760,627 | 649,167 | 1,476,215 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of earnings per share (in shares) | 337,907 | 642,418 | 224,706 | 421,412 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive securities excluded from computation of earnings per share (in shares) | 716,869 | 118,209 | 424,461 | 1,054,803 |
Segment and Geographic Inform_3
Segment and Geographic Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($)segment | Jun. 30, 2018USD ($) | |
Revenue, Major Customer [Line Items] | ||||||
Number of operating segments | segment | 1 | |||||
Number of reportable segments | segment | 1 | |||||
Revenue | $ 181,095 | $ 132,387 | $ 350,434 | $ 253,299 | ||
(Loss) income before income taxes | 16,369 | 4,625 | 47,806 | 17,606 | ||
Net income | 18,223 | $ 31,579 | 3,379 | $ 12,967 | 49,802 | 16,346 |
United States | ||||||
Revenue, Major Customer [Line Items] | ||||||
Revenue | 119,670 | 96,805 | 232,934 | 181,728 | ||
(Loss) income before income taxes | (11,897) | 8,017 | (6,902) | 5,752 | ||
Net income | (6,146) | 7,525 | 2,546 | 5,507 | ||
International | ||||||
Revenue, Major Customer [Line Items] | ||||||
Revenue | 61,425 | 35,582 | 117,500 | 71,571 | ||
(Loss) income before income taxes | 28,266 | (3,392) | 54,708 | 11,854 | ||
Net income | $ 24,369 | $ (4,146) | $ 47,256 | $ 10,839 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Major Categories of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $ 272,246 | $ 252,631 |
Short-term investments | 274,673 | 257,302 |
Funds receivable and customer accounts | 20,308 | 9,229 |
Long-term investments | 25,438 | |
Asset | 592,665 | 519,162 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 7,775 | |
Short-term investments | 79,028 | 147,860 |
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 83,924 | 46,801 |
Long-term investments | 25,438 | |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 272,246 | 244,856 |
Funds receivable and customer accounts | 20,308 | 9,229 |
U.S. Government and agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 111,721 | 62,641 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 272,246 | 244,856 |
Short-term investments | 111,721 | 62,641 |
Funds receivable and customer accounts | 20,308 | 9,229 |
Long-term investments | 0 | |
Asset | 404,275 | 316,726 |
Level 1 | Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | |
Short-term investments | 0 | 0 |
Level 1 | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Long-term investments | 0 | |
Level 1 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 272,246 | 244,856 |
Funds receivable and customer accounts | 20,308 | 9,229 |
Level 1 | U.S. Government and agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 111,721 | 62,641 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 7,775 |
Short-term investments | 162,952 | 194,661 |
Funds receivable and customer accounts | 0 | 0 |
Long-term investments | 25,438 | |
Asset | 188,390 | 202,436 |
Level 2 | Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 7,775 | |
Short-term investments | 79,028 | 147,860 |
Level 2 | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 83,924 | 46,801 |
Long-term investments | 25,438 | |
Level 2 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Funds receivable and customer accounts | 0 | 0 |
Level 2 | U.S. Government and agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Short-term investments | 0 | 0 |
Funds receivable and customer accounts | 0 | 0 |
Long-term investments | 0 | |
Asset | 0 | 0 |
Level 3 | Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | |
Short-term investments | 0 | 0 |
Level 3 | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Long-term investments | 0 | |
Level 3 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Funds receivable and customer accounts | 0 | 0 |
Level 3 | U.S. Government and agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Convertible Debt | Convertible Senior Notes due 2023 | Reported Value Measurement | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | $ 303.5 | $ 279.1 |
Marketable Securities (Details)
Marketable Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Cost | $ 299,677 | $ 265,109 |
Gross Unrealized Holding Loss | 0 | (44) |
Gross Unrealized Holding Gain | 434 | 12 |
Fair Value | 300,111 | 265,077 |
Cash Equivalents | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 7,775 | |
Gross Unrealized Holding Loss | 0 | |
Gross Unrealized Holding Gain | 0 | |
Fair Value | 7,775 | |
Cash Equivalents | Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 7,775 | |
Gross Unrealized Holding Loss | 0 | |
Gross Unrealized Holding Gain | 0 | |
Fair Value | 7,775 | |
Short-term Investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 274,381 | 257,334 |
Gross Unrealized Holding Loss | 0 | (44) |
Gross Unrealized Holding Gain | 292 | 12 |
Fair Value | 274,673 | 257,302 |
Short-term Investments | Commercial paper | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 79,028 | 147,860 |
Gross Unrealized Holding Loss | 0 | 0 |
Gross Unrealized Holding Gain | 0 | 0 |
Fair Value | 79,028 | 147,860 |
Short-term Investments | Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 83,778 | 46,836 |
Gross Unrealized Holding Loss | 0 | (35) |
Gross Unrealized Holding Gain | 146 | 0 |
Fair Value | 83,924 | 46,801 |
Short-term Investments | U.S. Government and agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 111,575 | 62,638 |
Gross Unrealized Holding Loss | 0 | (9) |
Gross Unrealized Holding Gain | 146 | 12 |
Fair Value | 111,721 | $ 62,641 |
Long-term investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 25,296 | |
Gross Unrealized Holding Loss | 0 | |
Gross Unrealized Holding Gain | 142 | |
Fair Value | 25,438 | |
Long-term investments | Corporate bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cost | 25,296 | |
Gross Unrealized Holding Loss | 0 | |
Gross Unrealized Holding Gain | 142 | |
Fair Value | $ 25,438 |
Leases (Details)
Leases (Details) | Jun. 30, 2019USD ($)ft² |
Corporate Headquarters | |
Lessee, Lease, Description [Line Items] | |
Area of real estate property (in sqft) | ft² | 225,135 |
Lease Arrangements, Hosting | DFS | |
Lessee, Lease, Description [Line Items] | |
Lessee, finance lease, term of contract | 36 months |
Lessee, finance lease, discount rate | 0.00% |
Lessee, finance lease, buy-out option, amount | $ 1 |
Lease Arrangements, Hosting and Computer Equipment | ePlus | |
Lessee, Lease, Description [Line Items] | |
Lessee, finance lease, term of contract | 36 months |
Lessee, finance lease, buy-out option, amount | $ 1 |
Lease Arrangements, Hosting and Computer Equipment | ePlus | Minimum | |
Lessee, Lease, Description [Line Items] | |
Lessee, finance lease, discount rate | 3.71% |
Lease Arrangements, Hosting and Computer Equipment | ePlus | Maximum | |
Lessee, Lease, Description [Line Items] | |
Lessee, finance lease, discount rate | 6.93% |
Leases - Elements of Lease Expe
Leases - Elements of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 1,272 | $ 2,550 |
Finance lease cost: | ||
Amortization of right-of-use assets | 3,320 | 6,690 |
Interest on lease liabilities | 823 | 1,693 |
Total finance lease cost | 4,143 | 8,383 |
Other lease income, net | 126 | 68 |
Total lease cost | $ 5,541 | $ 11,001 |
Leases - Lease-related Assets a
Leases - Lease-related Assets and Liabilities (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Operating leases: | |
Other assets | $ 23,410 |
Other current liabilities | 3,995 |
Other liabilities | 21,638 |
Total operating lease liabilities | 25,633 |
Finance leases: | |
Property and equipment, net | 65,621 |
Finance lease obligations—current | 9,306 |
Finance lease obligations—net of current portion | 57,409 |
Total finance lease liabilities | $ 66,715 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Term and Weighted Average Discount Rate (Details) | Jun. 30, 2019 |
Leases [Abstract] | |
Weighted average remaining lease term, operating leases | 6 years 6 months 7 days |
Weighted average remaining lease term, finance leases | 6 years 9 months |
Weighted average discount rate, operating leases | 4.26% |
Weighted average discount rate, finance leases | 4.37% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Leases [Abstract] | |
Operating cash flows used in operating leases | $ (2,390) |
Operating cash flows used in finance leases | (1,681) |
Finance cash flows used in finance leases | $ (5,475) |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments Under Non-cancelable Leases (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Operating Leases | |
2019 | $ 2,313 |
2020 | 4,793 |
2021 | 4,182 |
2022 | 4,177 |
2023 | 4,201 |
Thereafter | 9,756 |
Total future minimum lease payments | 29,422 |
Less imputed interest | 3,789 |
Total | 25,633 |
Finance Leases | |
2019 | 6,000 |
2020 | 11,400 |
2021 | 10,960 |
2022 | 10,547 |
2023 | 10,599 |
Thereafter | 27,715 |
Total future minimum lease payments | 77,221 |
Less imputed interest | 10,506 |
Total | $ 66,715 |
Leases - Commitments Under Prev
Leases - Commitments Under Previous Presentation (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Capital Lease Obligations | |
2019 | $ 4,392 |
2020 | 1,754 |
2021 | 481 |
2022 | 0 |
2023 | 0 |
Thereafter | 0 |
Total minimum payments required | 6,627 |
Amounts representing interest | 648 |
Present value of net minimum payments | 5,979 |
Current maturities | 3,884 |
Long-term payment obligations | 2,095 |
Operating Leases | |
2019 | 4,904 |
2020 | 4,783 |
2021 | 4,185 |
2022 | 4,180 |
2023 | 4,205 |
Thereafter | 9,760 |
Total minimum payments required | 32,017 |
Build-to-Suit Lease | |
2019 | 9,451 |
2020 | 9,522 |
2021 | 10,354 |
2022 | 10,520 |
2023 | 10,599 |
Thereafter | 27,715 |
Total minimum payments required | $ 78,161 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Vendor accruals | $ 20,315 | $ 17,817 |
Sales and use tax payable | 14,013 | 12,232 |
Accrued bonus | 11,246 | 12,906 |
Income tax payable | 6,687 | 10 |
Payroll-related liabilities | 2,604 | 2,406 |
Accrued vacation | 822 | 3,787 |
Total accrued expenses | $ 55,687 | $ 49,158 |
Debt - Convertible Debt (Detail
Debt - Convertible Debt (Details) | Jun. 30, 2019USD ($) | Mar. 31, 2018USD ($) | Jun. 30, 2019USD ($)day | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) |
Debt Instrument [Line Items] | |||||||
Purchase of capped call | $ 34,200,000 | $ 0 | $ 34,224,000 | ||||
Non-cash interest expense | 6,314,000 | 3,914,000 | |||||
Convertible Senior Notes due 2023 | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument | $ 345,000,000 | ||||||
Interest rate, stated percentage | 0.00% | ||||||
Proceeds from issuance of convertible senior notes | $ 335,000,000 | ||||||
Threshold percentage of stock price trigger | 130.00% | ||||||
Threshold trading days | day | 20 | ||||||
Threshold consecutive trading days | day | 30 | ||||||
If-converted value in excess of principal | $ 238,700,000 | ||||||
If-converted value in excess of principal offset by capped call transaction | 583,700,000 | ||||||
Capitalization of debt issuance costs | $ 10,000,000 | ||||||
Non-cash interest expense | $ 3,800,000 | $ 3,600,000 | 7,500,000 | $ 4,800,000 | |||
Unamortized debt issuance expense | 5,900,000 | 5,900,000 | 5,900,000 | $ 6,700,000 | |||
Level 2 | Reported Value Measurement | Convertible Senior Notes due 2023 | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt, fair value | $ 303,500,000 | $ 303,500,000 | $ 303,500,000 | $ 279,100,000 |
Debt - Credit Agreement (Detail
Debt - Credit Agreement (Details) - USD ($) | Feb. 25, 2019 | Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 |
Line of Credit Facility [Line Items] | ||||
Non-cash interest expense | $ 6,314,000 | $ 3,914,000 | ||
Credit Agreement | ||||
Line of Credit Facility [Line Items] | ||||
Maximum required secured net leverage ratio | 300.00% | |||
Maximum required secured net leverage ratio, certain material acquisitions | 350.00% | |||
Minimum required interest coverage ratio | 250.00% | |||
Capitalization of debt issuance costs | $ 1,400,000 | |||
Non-cash interest expense | $ 100,000 | 100,000 | ||
Unamortized debt issuance expense | 1,300,000 | 1,300,000 | ||
Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | 200,000,000 | |||
Maximum unrestricted cash | 100,000,000 | |||
Contingent right to increase maximum borrowing capacity amount | 100,000,000 | |||
Line of credit facility, amount outstanding | $ 0 | $ 0 | ||
Credit Agreement | Letter of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | 30,000,000 | |||
Credit Agreement | Bridge Loan | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 10,000,000 | |||
Federal Funds Effective Swap Rate | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.50% | |||
London Interbank Offered Rate (LIBOR) | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.00% | |||
Minimum | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Commitment fee amount | 0.20% | |||
Minimum | One-Month London Interbank Offered Rate (LIBOR) Plus 1% | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.25% | |||
Minimum | London Interbank Offered Rate (LIBOR), Adjusted | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.25% | |||
Maximum | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Commitment fee amount | 0.35% | |||
Maximum | One-Month London Interbank Offered Rate (LIBOR) Plus 1% | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.875% | |||
Maximum | London Interbank Offered Rate (LIBOR), Adjusted | Credit Agreement | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.875% |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Nov. 01, 2018 | Nov. 30, 2017 |
Equity [Abstract] | ||||||||
Stock repurchase program, authorized amount (up to) | $ 200,000,000 | $ 100,000,000 | ||||||
Shares Repurchased (in shares) | 5,565,060 | 5,032,648 | 532,412 | |||||
Average Price Paid per Share (in dollars per share) | $ 32.84 | $ 28.80 | $ 51.64 | |||||
Stock repurchased and retired during period, value, including broker fees | $ 0 | $ (27,500,000) | ||||||
Value of Shares Repurchased | $ 172,500,000 | $ 145,000,000 | $ 27,492,000 | $ 21,075,000 | $ 68,586,000 | |||
Remaining Amount Authorized | $ 127,500,000 | $ 155,000,000 | $ 127,500,000 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Millions | Jan. 02, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation expense—acquisitions | $ 0.4 | $ 0.7 | $ 0.7 | $ 1.4 | |
Stock options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Total unrecognized compensation | 24.5 | $ 24.5 | |||
Total unrecognized compensation, period of recognition | 2 years 8 months 8 days | ||||
RSUs | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Total unrecognized compensation, period of recognition | 3 years 3 months 3 days | ||||
Total unrecognized compensation | $ 103.4 | $ 103.4 | |||
2015 Equity Incentive Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Maximum number of additional shares issued annually (in shares) | 2,395,434 | ||||
Number of shares authorized (in shares) | 31,831,808 | 31,831,808 | |||
Number of shares available for grant (in shares) | 20,697,053 | 20,697,053 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value of Options Granted Using the Black-Scholes Pricing Model (Details) - Stock options | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Volatility, minimum | 39.20% | 38.60% | 39.20% | 38.60% |
Volatility, maximum | 39.50% | 42.10% | 39.50% | 42.10% |
Risk-free interest rate, minimum | 1.90% | 2.80% | 1.90% | 2.60% |
Risk-free interest rate, maximum | 2.40% | 2.90% | 2.50% | 2.90% |
Dividend rate | 0.00% | 0.00% | 0.00% | 0.00% |
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term | 5 years 6 months | 5 years 6 months | 5 years 6 months | 5 years 6 months |
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term | 6 years 1 month 28 days | 6 years 29 days | 6 years 1 month 28 days | 6 years 3 months |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2019 | |
Shares | |
Outstanding, beginning balance (in shares) | 6,890,994 |
Granted (in shares) | 320,888 |
Exercised (in shares) | (688,890) |
Forfeited/Canceled (in shares) | (186,644) |
Outstanding, ending balance (in shares) | 6,336,348 |
Total exercisable at June 30, 2019 (in shares) | 3,256,827 |
Weighted-Average Exercise Price | |
Outstanding, beginning balance (in dollars per share) | $ 12.91 |
Granted (in dollars per share) | 68.84 |
Exercised (in dollars per share) | 11.38 |
Forfeited/Canceled (in dollars per share) | 28.31 |
Outstanding, ending balance (in dollars per share) | 15.46 |
Total exercisable at June 30, 2019 (in dollars per share) | $ 11.65 |
Weighted-Average Remaining Contract Term (in years) | |
Outstanding at June 30, 2019, Weighted-Average Remaining Contract Term | 7 years 7 months 13 days |
Total exercisable at June 30, 2019, Weighted-Average Remaining Contract Term | 7 years 1 month 17 days |
Aggregate Intrinsic Value | |
Outstanding at June 30, 2019, Aggregate Intrinsic Value | $ 293,334 |
Total exercisable at June 30, 2019, Aggregate Intrinsic Value | $ 161,917 |
Stock-Based Compensation - Weig
Stock-Based Compensation - Weighted Average Grant Date Fair Value of Options Granted, Intrinsic Value of Options Exercised and Fair Value of Awards Vested (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Payment Arrangement [Abstract] | ||||
Weighted average grant date fair value of options (in dollars per share) | $ 25 | $ 13.51 | $ 28.90 | $ 12.50 |
Intrinsic value of options exercised | $ 8,373 | $ 1,397 | $ 36,896 | $ 11,196 |
Fair value of awards vested | $ 12,108 | $ 11,469 | $ 18,191 | $ 14,399 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Unvested RSUs (Details) - RSUs | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Shares | |
Unvested at December 31, 2018 (in shares) | shares | 3,480,368 |
Granted (in shares) | shares | 868,828 |
Vested (in shares) | shares | (680,661) |
Forfeited/Cancelled (in shares) | shares | (385,591) |
Unvested at June 30, 2019 (in shares) | shares | 3,282,944 |
Weighted-Average Grant Date Fair Value | |
Unvested at December 31, 2018 (in dollars per share) | $ / shares | $ 22.87 |
Granted (in dollars per share) | $ / shares | 67.48 |
Vested (in dollars per share) | $ / shares | 18.65 |
Forfeited/Cancelled (in dollars per share) | $ / shares | 26.96 |
Unvested at June 30, 2019 (in dollars per share) | $ / shares | $ 35.07 |
Stock-Based Compensation - Allo
Stock-Based Compensation - Allocated Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 10,837 | $ 8,617 | $ 18,919 | $ 15,071 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 1,456 | 927 | 2,555 | 1,473 |
Marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 723 | 699 | 1,354 | 1,177 |
Product development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 5,294 | 4,025 | 8,813 | 6,664 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 3,364 | $ 2,966 | $ 6,197 | $ 5,757 |
Subsequent Event (Details)
Subsequent Event (Details) $ in Millions | Jul. 21, 2019USD ($) |
Reverb Holdings Inc. | Subsequent Event | |
Subsequent Event [Line Items] | |
Merger agreement, consideration to be transferred | $ 275 |