Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 17, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-36911 | ||
Entity Registrant Name | ETSY, INC. | ||
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 | ||
Common Stock, $0.001 par value per share | Common Stock, $0.001 par value per share | ||
Trading Symbol | ETSY | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 9,212 | ||
Entity Common Stock, Shares Outstanding (in shares) | 124,649,062 | ||
Documents Incorporated by Reference | Portions of the registrant’s Proxy Statement for its 2023 Annual Meeting of Stockholders, to be filed with the Securities and Exchange Commission no later than 120 days after December 31, 2022, are incorporated by reference in Part III of this Annual Report. | ||
Entity Central Index Key | 0001370637 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Firm ID | 238 |
Auditor Name | PricewaterhouseCoopers LLP |
Auditor Location | New York, New York |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 921,278 | $ 780,196 |
Short-term investments | 250,413 | 204,416 |
Accounts receivable, net | 27,888 | 27,266 |
Prepaid and other current assets | 80,203 | 109,417 |
Funds receivable and seller accounts | 233,961 | 220,206 |
Total current assets | 1,513,743 | 1,341,501 |
Restricted cash | 5,341 | 5,341 |
Property and equipment, net | 249,744 | 275,062 |
Goodwill | 137,724 | 1,371,064 |
Intangible assets, net | 535,406 | 607,170 |
Deferred tax assets | 121,506 | 95,863 |
Long-term investments | 29,137 | 85,034 |
Other assets | 42,360 | 50,774 |
Total assets | 2,634,961 | 3,831,809 |
Current liabilities: | ||
Accounts payable | 28,757 | 28,007 |
Accrued expenses | 331,234 | 328,118 |
Finance lease obligations—current | 4,731 | 2,418 |
Funds payable and amounts due to sellers | 233,961 | 220,206 |
Deferred revenue | 14,008 | 12,339 |
Other current liabilities | 19,064 | 24,500 |
Total current liabilities | 631,755 | 615,588 |
Finance lease obligations—net of current portion | 105,699 | 110,283 |
Deferred tax liabilities | 44,735 | 79,484 |
Long-term debt, net | 2,279,640 | 2,275,418 |
Other liabilities | 120,406 | 122,417 |
Total liabilities | 3,182,235 | 3,203,190 |
Commitments and contingencies (Note 13) | ||
Stockholders’ (deficit) equity: | ||
Common stock ($0.001 par value, 1,400,000,000 shares authorized as of December 31, 2022 and 2021; 125,054,278 and 127,022,118 shares issued and outstanding as of December 31, 2022 and 2021, respectively) | 125 | 127 |
Preferred stock ($0.001 par value, 25,000,000 shares authorized as of December 31, 2022 and 2021) | 0 | 0 |
Additional paid-in capital | 815,085 | 631,762 |
(Accumulated deficit) retained earnings | (1,048,267) | 71,744 |
Accumulated other comprehensive loss | (314,217) | (75,014) |
Total stockholders’ (deficit) equity | (547,274) | 628,619 |
Total liabilities and stockholders’ (deficit) equity | $ 2,634,961 | $ 3,831,809 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
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) | 125,054,278 | 127,022,118 |
Common stock, shares outstanding (in shares) | 125,054,278 | 127,022,118 |
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 - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Statement [Abstract] | |||
Revenue | $ 2,566,111 | $ 2,329,114 | $ 1,725,625 |
Cost of revenue | 744,592 | 654,512 | 464,745 |
Gross profit | 1,821,519 | 1,674,602 | 1,260,880 |
Operating expenses: | |||
Marketing | 710,399 | 654,804 | 500,756 |
Product development | 412,398 | 271,535 | 180,080 |
General and administrative | 312,260 | 282,531 | 156,035 |
Goodwill impairment | 1,045,022 | 0 | 0 |
Total operating expenses | 2,480,079 | 1,208,870 | 836,871 |
(Loss) income from operations | (658,560) | 465,732 | 424,009 |
Other (expense) income: | |||
Loss on extinguishment of debt | 0 | 0 | (16,855) |
Interest expense | (14,168) | (9,885) | (42,025) |
Interest and other income | 10,956 | 2,137 | 7,102 |
Foreign exchange (loss) gain | (206) | 13,670 | (6,522) |
Total other (expense) income | (3,418) | 5,922 | (58,300) |
(Loss) income before income taxes | (661,978) | 471,654 | 365,709 |
(Provision) benefit for income taxes | (32,310) | 21,853 | (16,463) |
Net (loss) income | $ (694,288) | $ 493,507 | $ 349,246 |
Net (loss) income per share attributable to common stockholders: | |||
Basic (in dollars per share) | $ (5.48) | $ 3.88 | $ 2.88 |
Diluted (in dollars per share) | $ (5.48) | $ 3.40 | $ 2.69 |
Weighted average common shares outstanding: | |||
Basic (in shares) | 126,778,626 | 127,224,974 | 121,251,588 |
Diluted (in shares) | 126,778,626 | 146,683,324 | 136,414,592 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive (Loss) Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net (loss) income | $ (694,288) | $ 493,507 | $ 349,246 |
Other comprehensive (loss) income: | |||
Cumulative translation adjustment | (237,784) | (80,203) | 14,468 |
Unrealized (losses) gains on marketable securities, net of tax (benefit) expense of $(448), $(240), and $73, respectively | (1,419) | (762) | 182 |
Total other comprehensive (loss) income | (239,203) | (80,965) | 14,650 |
Comprehensive (loss) income | $ (933,491) | $ 412,542 | $ 363,896 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive (Loss) Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Unrealized holding gain (loss) arising during period, tax | $ (448) | $ (240) | $ 73 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders’ (Deficit) Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-in Capital | Additional Paid-in Capital Cumulative Effect, Period of Adoption, Adjustment | (Accumulated Deficit) Retained Earnings | (Accumulated Deficit) Retained Earnings Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive (Loss) Income | |
Beginning balance (in shares) at Dec. 31, 2019 | 118,342,772 | ||||||||
Beginning balance at Dec. 31, 2019 | $ 406,634 | $ 119 | $ 642,628 | $ (227,414) | $ (8,699) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Accounting Standards Update [Extensible List] | Accounting Standards Update 2020-06 [Member] | ||||||||
Stock-based compensation | $ 66,350 | 66,350 | |||||||
Exercise of vested options (in shares) | 1,834,773 | 1,834,773 | |||||||
Exercise of vested options | $ 25,319 | $ 1 | 25,318 | ||||||
Issuance of convertible senior notes, net of issuance costs and taxes | 102,131 | 102,131 | |||||||
Purchase of capped calls, net of taxes | (56,848) | (56,848) | |||||||
Settlement of convertible senior notes, net of taxes (in shares) | 7,271,723 | ||||||||
Settlement of convertible senior notes, net of taxes | 151,311 | $ 7 | 151,304 | ||||||
Vesting of restricted stock units, net of shares withheld (in shares) | 825,200 | ||||||||
Vesting of restricted stock units, net of shares withheld | $ (47,716) | $ 1 | (47,717) | ||||||
Stock repurchase (in shares) | (1,161,947) | (2,438,537) | |||||||
Stock repurchase | $ (268,653) | $ (2) | (268,651) | ||||||
Other comprehensive income (loss) | 14,650 | 14,650 | |||||||
Net (loss) income | 349,246 | 349,246 | |||||||
Ending balance (in shares) at Dec. 31, 2020 | 125,835,931 | ||||||||
Ending balance at Dec. 31, 2020 | 742,424 | $ (200,910) | $ 126 | 883,166 | $ (228,738) | (146,819) | $ 27,828 | 5,951 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation | $ 139,280 | 139,280 | |||||||
Exercise of vested options (in shares) | 994,456 | 994,456 | |||||||
Exercise of vested options | $ 22,706 | $ 1 | 22,705 | ||||||
Purchase of capped calls, net of taxes | (64,673) | (64,673) | |||||||
Settlement of convertible senior notes, net of taxes (in shares) | 985,522 | ||||||||
Settlement of convertible senior notes, net of taxes | (423) | $ 1 | (424) | ||||||
Vesting of restricted stock units, net of shares withheld (in shares) | 818,442 | ||||||||
Vesting of restricted stock units, net of shares withheld | $ (119,553) | $ 1 | (119,554) | ||||||
Stock repurchase (in shares) | (554,718) | (1,612,233) | |||||||
Stock repurchase | $ (302,774) | $ (2) | (302,772) | ||||||
Other comprehensive income (loss) | (80,965) | (80,965) | |||||||
Net (loss) income | $ 493,507 | 493,507 | |||||||
Ending balance (in shares) at Dec. 31, 2021 | 127,022,118 | 127,022,118 | |||||||
Ending balance at Dec. 31, 2021 | $ 628,619 | $ 127 | 631,762 | 71,744 | (75,014) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation (in shares) | [1] | 191,493 | |||||||
Stock-based compensation | $ 248,114 | 248,114 | |||||||
Exercise of vested options (in shares) | 816,620 | 816,620 | |||||||
Exercise of vested options | $ 15,024 | $ 1 | 15,023 | ||||||
Settlement of convertible senior notes, net of taxes (in shares) | 358 | ||||||||
Vesting of restricted stock units, net of shares withheld (in shares) | 981,844 | ||||||||
Vesting of restricted stock units, net of shares withheld | $ (79,813) | $ 1 | (79,814) | ||||||
Stock repurchase (in shares) | (3,958,155) | (3,958,155) | |||||||
Stock repurchase | $ (425,727) | $ (4) | (425,723) | ||||||
Other comprehensive income (loss) | (239,203) | (239,203) | |||||||
Net (loss) income | $ (694,288) | (694,288) | |||||||
Ending balance (in shares) at Dec. 31, 2022 | 125,054,278 | 125,054,278 | |||||||
Ending balance at Dec. 31, 2022 | $ (547,274) | $ 125 | $ 815,085 | $ (1,048,267) | $ (314,217) | ||||
[1](1) Includes the partial payment of Depop deferred consideration. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Cash flows from operating activities | ||||
Net (loss) income | $ (694,288) | $ 493,507 | $ 349,246 | |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||
Stock-based compensation expense | 230,888 | 139,910 | 65,114 | |
Depreciation and amortization expense | 96,702 | 74,267 | 58,189 | |
Provision for expected credit losses | 12,464 | 16,031 | 15,033 | |
Foreign exchange loss (gain) | 1,238 | (14,071) | 7,349 | |
Non-cash interest expense | 578 | 578 | 36,086 | |
Interest expense on marketable securities | 652 | 3,154 | 2,729 | |
Goodwill impairment | 1,045,022 | 0 | 0 | |
Deferred (benefit) provision for income taxes | (55,303) | (88,952) | 2,202 | |
Loss on extinguishment of debt | 0 | 0 | 16,855 | |
Other non-cash expense, net | 5,193 | 3,244 | 1,956 | |
Changes in operating assets and liabilities, net of acquisitions: | ||||
Accounts receivable | (14,056) | (19,256) | (22,540) | |
Funds receivable and seller accounts | (20,570) | (83,941) | (90,141) | |
Prepaid expenses and other current assets | 23,840 | (44,186) | (16,963) | |
Other assets | 7,390 | (25,159) | 4,816 | |
Accounts payable | 532 | (14,169) | 14,550 | |
Accrued and other current liabilities | 6,439 | 84,789 | 146,634 | |
Funds payable and amounts due to sellers | 20,570 | 83,941 | 90,141 | |
Deferred revenue | 1,905 | 1,441 | 3,312 | |
Other liabilities | 14,416 | 40,423 | (5,612) | |
Net cash provided by operating activities | 683,612 | 651,551 | 678,956 | |
Cash flows from investing activities | ||||
Acquisition of businesses, net of cash acquired | 0 | (1,699,974) | 0 | |
Cash paid for asset acquisition and intangible assets | (6,456) | (1,937) | (880) | |
Purchases of property and equipment | (10,237) | (11,248) | (1,445) | |
Development of internal-use software | (20,506) | (16,922) | (5,665) | |
Purchases of marketable securities | (270,345) | (418,518) | (499,237) | |
Sales and maturities of marketable securities | 277,520 | 590,630 | 495,848 | |
Net cash used in investing activities | (30,024) | (1,557,969) | (11,379) | |
Cash flows from financing activities | ||||
Payment of tax obligations on vested equity awards | (79,163) | (118,167) | (47,716) | |
Repurchase of stock | (425,727) | (302,774) | (268,653) | |
Proceeds from exercise of stock options | 15,024 | 22,706 | 25,319 | |
Proceeds from issuance of convertible senior notes | 0 | 1,000,000 | 650,000 | |
Payment of debt issuance costs | (25) | (13,300) | (10,531) | |
Purchase of capped calls | 0 | (85,000) | (74,685) | |
Settlement of convertible senior notes | (44) | (43,900) | (137,168) | |
Payments on finance lease obligations | (6,307) | (8,864) | (9,211) | |
Other financing, net | (10,242) | 2,048 | (8,073) | |
Net cash (used in) provided by financing activities | (506,484) | 452,749 | 119,282 | |
Effect of exchange rate changes on cash | (6,022) | (10,234) | 13,947 | |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 141,082 | (463,903) | 800,806 | |
Cash, cash equivalents, and restricted cash at beginning of period | 785,537 | 1,249,440 | 448,634 | |
Cash, cash equivalents, and restricted cash at end of period | 926,619 | 785,537 | 1,249,440 | |
Supplemental cash flow disclosures: | ||||
Cash paid for interest | 9,534 | 6,054 | 3,405 | |
Cash paid for income taxes, net of refunds | 41,679 | 94,160 | 8,535 | |
Supplemental non-cash disclosures: | ||||
Replacement share-based awards issued in conjunction with acquisitions | 0 | 5,686 | 0 | |
Stock-based compensation capitalized in development of capitalized software and asset additions in exchange for liabilities | 9,799 | 7,297 | 2,852 | |
Deferred consideration | 17,197 | [1] | 0 | 0 |
Lease assets obtained in exchange for new lease liabilities | 1,727 | 68,023 | 3,183 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | 921,278 | 780,196 | 1,244,099 | |
Restricted cash | 5,341 | 5,341 | 5,341 | |
Total cash and cash equivalents, and restricted cash | $ 926,619 | $ 785,537 | $ 1,249,440 | |
[1](1) See “Note 15—Stock-based Compensation” for more information on the settlement of deferred consideration. |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) shares in Millions | Mar. 31, 2018 |
2018 Notes | Convertible Debt | |
Debt instrument, interest rate, stated percentage | 0% |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
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 operates two-sided online marketplaces that connect millions of passionate and creative buyers and sellers around the world. These marketplaces - which collectively create a “House of Brands” - share the Company’s mission, common levers for growth, similar business models, and a strong commitment to use the power of business and technology to strengthen communities and empower people. The Company’s primary marketplace, Etsy.com, is the global destination for unique and creative goods. The Company generates revenue primarily from marketplace activities, including transaction, listing, and payments processing fees, and fees for optional seller services, which include on-site advertising and shipping label services. Basis of Consolidation The consolidated financial statements include the accounts of Etsy, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. On July 12, 2021, Etsy acquired all of the issued share capital of Depop Limited (“Depop”) pursuant to a share purchase, and on July 2, 2021, Etsy acquired all the outstanding shares of Elo7 Serviços de Informática S.A. (“Elo7”) by means of a merger. The financial results of Depop and Elo7 have been included in Etsy’s consolidated financial statements from the dates of acquisition. See “Note 5—Business Combinations.” Reclassification Certain items in the prior years consolidated financial statements have been reclassified to conform to the current year presentation reflected in the consolidated financial statements. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the Company to make estimates and judgments that affect the amounts reported and disclosed in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates and judgments. The accounting estimates that require management’s most subjective judgments include: stock-based compensation; income taxes; the valuation of acquired intangible assets, developed technology, and goodwill as part of purchase price allocations for business combinations; valuation of goodwill; leases; and fair value of convertible senior notes. As of December 31, 2022, the Company continues to monitor the effects of global macroeconomic and geopolitical uncertainty, including COVID-19 pandemic related factors and general market, political, and economic conditions, on the Company’s business, results of operations, and financial condition. As a result, many of the Company’s estimates and judgments require increased judgment and carry a higher degree of variability and volatility. As additional information becomes available, the Company’s estimates may change materially in future periods. Revenue Recognition The Company’s revenue is diversified; generated from a mix of marketplace activities and other optional services the Company provides to sellers to help them generate more sales and scale their businesses. Revenues are recognized as the Company transfers control of promised goods or services to 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. The Company’s revenues are recognized on a gross basis, with the primary exception being shipping label revenue, which is recorded on a net basis. Sales and usage-based taxes are excluded from revenues. Marketplace revenue: As members of the Etsy.com 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 marketplace sellers pay a fixed listing fee of $0.20 for each item listed on Etsy.com, and 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. Listing fees are nonrefundable. Variable fees include transaction fees and payments processing fees. Etsy marketplace sellers pay a 6.5% transaction fee, which was increased from 5% effective April 11, 2022, for each completed transaction, inclusive of shipping fees charged. In May 2020, the Etsy marketplace started charging sellers for Offsite Ads, whereby sellers pay a transaction fee of 12% or 15% of the value of a sale based on the seller’s volume of sales, if such sale is generated from an advertisement placed by Etsy on third-party internet platforms. The corresponding expense is recorded in marketing. Etsy marketplace sellers pay Etsy Payments processing fees, which typically vary between 3.0% and 4.5% of an item’s total sale price, including shipping, plus a flat fee per order that depends on the country in which a seller’s bank account is located, plus an additional transaction fee for foreign currency payments. The transaction fee, Offsite Ads transaction fee, and Etsy Payments processing fees are recognized when the corresponding transaction is consummated, and are recorded net of refunds. Reverb, Depop, and Elo7 marketplace revenue is comprised of seller transaction fees and payments processing fees, which are recognized when the transaction is consummated, and are recorded net of refunds. Reverb, Elo7, and Depop sellers pay a 5%, 7%, and 10% transaction fee, respectively, for each completed transaction. The Reverb and Depop transaction fee is inclusive of shipping fees charged. Services revenue: Services revenue is derived from optional services offered to Etsy marketplace sellers, which primarily include on-site advertising and shipping labels. Each service represents an individual obligation that the Company must perform when a seller chooses to use the service. On-site advertising services consist of cost-per-click fees an Etsy marketplace seller pays for prominent placement of her listings. These fees are nonrefundable and are charged to a seller’s Etsy bill when the listing is clicked, at which time revenue is recognized. Revenue from shipping labels consists of fees an Etsy marketplace 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 shipping label revenue when an Etsy marketplace seller purchases a shipping label. The Company recognizes 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 marketplace seller. Etsy shipping label revenue is recorded net of refunds. The Reverb, Depop, and Elo7 marketplaces offer on-site advertising services (Depop as of the end of the third quarter of 2022), and shipping labels services. Each service represents an individual obligation that the Company must perform when a seller chooses to use the service. Shipping label revenue is recorded net of refunds. Contract balances: The Company records deferred revenues when cash payments are received or due in advance of the completion of the four-month listing period on Etsy.com, which represents the value of the Company’s unsatisfied performance obligations, unless the item is sold or the seller re-lists it, at which time any remaining listing fee is recognized. The amount of revenue recognized in the year ended December 31, 2022 that was included in the deferred balance at January 1, 2022 was $12.3 million. Cost of Revenue Cost of revenue primarily consists of the cost of interchange and other fees for payments processing services, and expenses associated with the operation and maintenance of the Company’s platforms, including hosting and bandwidth costs. Cost of revenue also includes chargebacks to support payments revenue, costs of refunds made to buyers that the Company is either not able to collect from sellers or are otherwise covered by us, and seller verification fees. Additionally, cost of revenue includes certain employee compensation-related expenses, depreciation and amortization, and third-party customer support services. Marketing Marketing expenses primarily consist of direct marketing expenses, which largely includes digital marketing and television ad and digital video expenses. Marketing expenses also include employee compensation-related expenses to support the Company’s marketing initiatives and amortization expense related to acquired customer relationship and trademark intangible assets. Advertising expenses are recognized as incurred, with the exception of certain production expenses related to television and display advertising which are deferred until the first time an advertisement airs or is published. If such advertising is not expected to occur, costs are expensed immediately. Advertising expenses related to direct marketing, included in marketing expenses on the Consolidated Statements of Operations, were $581.1 million, $559.3 million, and $442.2 million in the years ended December 31, 2022, 2021, and 2020, respectively. Product Development Product development expenses consist primarily of employee compensation-related expenses for engineering, product management, product design, and product research activities, net of costs capitalized to website development and internal-use software. Additional expenses include consulting costs related to the development, quality assurance, and testing of new technology and enhancement of the Company’s existing technology. Stock-Based Compensation Service-based stock options and restricted stock units (“RSUs”) are awarded to employees and members of the Company’s Board of Directors and performance-based restricted stock units (“PBRSUs”) are awarded to employees. All such awards are measured at fair value at each grant date. The PBRSUs include financial performance-based restricted stock units (“Financial PBRSUs”) and total shareholder return performance-based restricted stock units (“TSR PBRSUs”), both of which have performance and service vesting requirements. The Company recognizes forfeitures as they occur. The Company calculates the fair value of stock options on the date of grant using the Black-Scholes option-pricing model and the expense is recognized over the requisite service period. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company calculates expected volatility based on the historical volatility of Etsy’s stock price observations over a period equivalent to the expected term of the stock option grants. The Company estimates its expected term using historical option exercise behavior and expected post-vest cancellation data, averaged with an assumption that recently granted options will be exercised ratably from vesting to the expiration of the stock option. The fair value of RSUs and Financial PBRSUs is determined based on the closing price of the Company’s common stock on Nasdaq on the grant date. Additionally, the fair value of the Financial PBRSUs takes into consideration a vesting probability assessment as of each reporting date. The fair value of the TSR PBRSUs is determined using a Monte-Carlo simulation model on the grant date. The requisite service period for stock options and RSUs is generally four years from the grant date. For PBRSUs, the Company recognizes stock-based compensation expenses on a straight-line basis over the longer of the derived, explicit, or implicit service period. As of interim and annual reporting periods, the Financial PBRSUs stock-based compensation expense is adjusted based on expected achievement of performance targets, while TSR PBRSUs stock-based compensation expense is not adjusted. Foreign Currency The Company has determined that the functional currency for each of its foreign operations is the currency of the primary cash flow of the operations, which is generally the local currency in which the operation is located. All assets and liabilities are translated into U.S. dollars using exchange rates in effect at the balance sheet date. Revenue and expenses are translated using average exchange rates during the period. Foreign currency translation adjustments are reflected in stockholders’ equity as a component of other comprehensive income (loss). Transaction gains and losses including intercompany balances denominated in a currency other than the functional currency of the entity involved are included in foreign exchange gain (loss) within other income (expense) in the Consolidated Statements of Operations. Income Taxes The income tax benefit is based on income before income taxes and is accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to settle. The Company recognizes future tax benefits, such as net operating losses and tax credits, to the extent that realizing these benefits is considered in its judgment to be more likely than not. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income or expense in the period that includes the enactment date. The Company regularly reviews the recoverability of its deferred tax assets by considering its historic profitability, projected future taxable income, timing of the reversals of existing temporary differences and the feasibility of its tax planning strategies. Where appropriate, the Company records a valuation allowance against deferred tax assets that are deemed not more likely than not to be realizable. The Company records tax expense related to Global Intangible Low Taxed Income (“GILTI”) as a current period expense when incurred using the period cost method. The Company accounts for uncertainty in income taxes using a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by the taxing authorities. The amount recognized is measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate audit settlement. The Company recognizes interest and penalties, if any, associated with income tax matters as part of the income tax provision and includes accrued interest and penalties with the related income tax liability in the Consolidated Balance Sheets. Net (Loss) Income Per Share Basic net (loss) income per share attributable to common stockholders is computed by dividing the net (loss) income attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted net (loss) income per share is computed by dividing net (loss) income adjusted on an if-converted basis for the period by the weighted-average number of shares of common stock and potentially dilutive common stock outstanding during the period. Potentially dilutive shares, which are based on the weighted-average shares of common stock underlying outstanding stock-based compensation awards and convertible senior notes using the treasury stock method or the if-converted method, as applicable, are included when calculating net (loss) income per share of common stock attributable to common stockholders when their effect is dilutive. The calculation of diluted net income per share excludes all anti-dilutive shares of common stock. Segment Data The Company identifies operating segments as components of an entity for which discrete financial information is available and is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in making decisions regarding resource allocation and performance assessment. The Company’s CODM is its Chief Executive Officer. The Company has determined it has four operating segments, Etsy, Reverb, Depop, and Elo7, which qualify for aggregation as one reportable segment. 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 of certificates of deposit, commercial paper, corporate bonds, U.S. agency securities, and U.S. Government securities with original maturities of greater than three months but less than one year, are classified as available-for-sale and are reported at fair value using the specific identification method. Long-term investments, consisting of corporate bonds and U.S. Government securities with original maturities of greater than twelve months but less than 37 months, 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 tax (expense) benefit. Restricted Cash The Company classifies any cash balances that are legally restricted as to withdrawal or usage as restricted cash on the Consolidated Balance Sheets. In connection with the Company’s noncancellable Brooklyn lease agreement, which expires in 2039, the Company established a $5.3 million collateral account, which is reflected in the restricted cash balance as of December 31, 2022 and 2021. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, short- and long-term investments, and funds receivable and seller accounts. The Company reduces credit risk by placing its cash and cash equivalents with major financial institutions with high credit ratings. At times, to the extent eligible, such amounts may exceed federally insured limits. The Company believes that minimal credit risk exists with respect to these investments due to the credit ratings of the financial institutions that hold its short- and long-term investments. In addition, funds receivable settle relatively quickly, and the Company’s historical experience of losses has not been significant. Fair Value of Financial Instruments Management believes that the fair value of financial instruments, consisting of cash and cash equivalents, short- and long-term investments, accounts receivable, funds receivable and seller accounts, accounts payable, and funds payable and amounts due to sellers approximates carrying value due to the immediate or short-term maturity associated with these instruments or the Company’s ability to liquidate these instruments at short notice with minimal penalties. Prior to the adoption of ASU 2020-06 in the first quarter of 2021, in accounting for the issuance of the 0.125% Convertible Senior Notes due 2027 (the “2020 Notes”), the 0.125% Convertible Senior Notes due 2026 (the “2019 Notes”), and the 2018 Notes (collectively, the 0.25% Convertible Senior notes due 2028 (the “2021 Notes”), the 2020 Notes, the 2019 Notes, and the 2018 Notes, the “Notes”), and the extinguishment of the 2018 Notes, discussed in “Note 12—Debt,” management used estimates and assumptions to calculate the carrying amounts of the liability and equity components by measuring the fair value of similar securities. The carrying amount of the liability component was calculated by measuring the fair value of a similar liability that does not have an associated convertible feature. To measure the fair value of a similar liability that does not have an associated convertible feature, the Company discounted the contractual cash flows of each of the Notes at an estimated interest rate for a comparable liability. The carrying amount of the equity component, representing the conversion option, which does not meet the criteria for separate accounting as a derivative as it is indexed to the Company’s stock, was determined by deducting the fair value of the liability component from the par value of each of the Notes. Following the adoption of ASU 2020-06, there is no bifurcation of the liability and equity components of the Notes. Subsequent to their issuance, the Notes are not measured at fair value in the Consolidated Balance Sheets, but the Company estimates the fair value of the liability component of the Notes through inputs that are observable in the market or that could be derived from observable market data, corroborated with quoted market prices of similar instruments. See Note 8—Fair Value Measurements for additional information. Accounts Receivable and Provision for Expected Credit Losses The Company’s trade accounts receivable are recorded at amounts billed to sellers and are presented on the Consolidated Balance Sheets net of the provision for expected credit losses. The provision is determined by a number of factors, including age of the receivable, current economic conditions, historical losses, and management’s assessment of the financial condition of sellers. Receivables are written off once they are deemed uncollectible. Estimates of uncollectible accounts receivable are recorded to general and administrative expense. Payment terms: On the first day of every month, Etsy sellers receive a statement outlining the previous month’s charges. Payment is due within 15 days of the date of the monthly statement. The payment terms for Reverb, Depop, and Elo7 are also short-term in nature. For Etsy sellers using Etsy Payments, all charges are deducted from the funds credited to the seller’s shop payment account prior to settlement of those funds to the seller’s bank account. The following table provides a rollforward of the allowance for credit losses that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be collected (in thousands): Year Ended 2022 2021 2020 Balance as of the beginning of period $ 7,730 $ 9,757 $ 5,033 Provision for expected credit losses 12,464 16,031 15,033 Amounts written off, net of recoveries (11,891) (18,058) (10,309) Balance as of the end of period $ 8,303 $ 7,730 $ 9,757 Funds Receivable and Seller Accounts and Funds Payable and Amounts due to Sellers The Company records funds receivable and seller accounts and funds payable and amounts due to sellers as current assets and liabilities, respectively, on the Consolidated Balance Sheets. Funds receivable and seller accounts represent amounts received or expected to be received from buyers via third-party credit card processors, which flow through a bank account for payment to sellers. The amounts recorded to funds receivable and seller accounts is the same amount recorded to the funds payable and amounts due to sellers, the latter of which represents the total amount due to sellers, given the intent to use these funds to settle funds payable to sellers. For the Depop marketplace only, the amounts received from buyers which is owed to the sellers is paid to the sellers at point of sale, and therefore no funds receivable and seller accounts and no funds payable and amounts due to sellers are recorded related to the Depop marketplace. Property and Equipment Property and equipment, consisting principally of capitalized website development and internal-use software, building, leasehold improvements, and computer equipment, are recorded at cost. Depreciation and amortization begin at the time the asset is placed into service and is recognized using the straight-line method in amounts sufficient to relate the cost of depreciable and amortizable assets to the Consolidated Statements of Operations over their estimated useful lives. Repairs and maintenance are charged to the Consolidated Statements of Operations as incurred. Upon sale or retirement of assets, the cost and related accumulated depreciation or amortization are removed from the Consolidated Balance Sheet and the resulting gain or loss is reflected in the Consolidated Statement of Operations. Website Development and Internal-use Software Costs Costs incurred to develop the Company’s website and software for internal-use are capitalized and amortized over the estimated useful life of the software, generally three Capitalized website development and internal-use software costs are included in property and equipment, net within the Consolidated Balance Sheets. Business Combinations The Company accounts for business combinations using the acquisition method of accounting. If the assets acquired are not a business, the Company accounts for the transaction as an asset acquisition. Under both methods, the purchase price is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of acquisition. Acquisition-related expenses represent expenses incurred by the Company to effect a business combination, including expenses such as finder’s fees and advisory, legal, accounting, valuation, and other professional or consulting fees, and are not included as a component of consideration transferred, but are accounted for as an expense in the period in which the costs are incurred or the services are rendered. Goodwill Goodwill represents the excess of the aggregate fair value of the consideration transferred in a business combination over the fair value of the assets acquired, net of liabilities assumed. The Company performs its annual goodwill impairment test during the fourth quarter or more frequently if events or changes in circumstances indicate that the goodwill may be impaired. Management has determined that the Company has four operating segments, Etsy, Reverb, Depop, and Elo7, and each operating segment is determined to be a reporting unit. The Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, the Company determines it is not more likely than not that the fair value of the reporting unit is less than its carrying amount, then additional impairment testing is not required. However, if the Company concludes otherwise, then it is required to perform a quantitative assessment for impairment. The quantitative assessment involves comparing the estimated fair value of the reporting unit with its respective book value, including goodwill. If the estimated fair value exceeds book value, goodwill is not considered to be impaired. If, however, the book value of the reporting unit exceeds the fair value, an impairment loss is recognized in an amount equal to the excess, not to exceed the total amount of goodwill allocated to that reporting unit. See “Note 6—Goodwill and Intangible Assets” for further information. Intangible Assets Finite intangible assets are amortized using the straight-line method over the estimated useful life of the asset. Leases The Company’s lease arrangements generally include real estate and computer equipment assets. 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. At lease commencement, the Company evaluates whether the arrangement is a finance or operating lease, and accounts for it accordingly. 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. Leases with a term greater than one year are recognized on the Consolidated Balance Sheets as right-of-use (“ROU”) assets, lease obligations, and, if applicable, long-term lease obligations in the financial statement 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 in 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 are 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. Impairment of Long-Lived Assets The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated from the use of the asset and its eventual disposition. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount exceeds the fair value of the impaired assets. Assets to be disposed of are reported at the lower of their carrying amount or fair value less cost to sell. The Company did not recognize any long-lived asset impairment charges in the years ended December 31, 2022, 2021, and 2020. See “Note 6—Goodwill and Intangible Assets” for further information. Contingencies The Company accrues for loss contingencies when losses become probable and are reasonably estimable. If the reasonable estimate of the loss is a range and no amount within the range is a better estimate, the minimum amount of the range is recorded as a liability. The Company does not accrue for contingent losses that, in its judgment, are considered to be reasonably possible, but not probable; however, it discloses the range of such reasonably possible losses. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 2—Revenue The following table summarizes revenue disaggregated by Marketplace revenue and optional Services revenue for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Marketplace revenue $ 1,910,887 $ 1,745,824 $ 1,303,126 Services revenue 655,224 583,290 422,499 Revenue $ 2,566,111 $ 2,329,114 $ 1,725,625 See “Note 1—Basis of Presentation and Summary of Significant Accounting Policies—Revenue Recognition” for additional information on revenue recognition. See “Note 1—Basis of Presentation and Summary of Significant Accounting Policies—Accounts Receivable and Provision for Expected Credit Losses” for additional information on the Company’s payment terms. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 3—Income Taxes The following are the domestic and foreign components of the Company’s (loss) income before income taxes (in thousands): Year Ended 2022 2021 2020 United States $ 225,685 $ 274,354 $ 206,481 International (887,663) 197,300 159,228 (Loss) income before income taxes $ (661,978) $ 471,654 $ 365,709 The income tax provision (benefit) is comprised of the following (in thousands): Year Ended 2022 2021 2020 Current: U.S. Federal $ 46,700 $ 23,118 $ 4,854 U.S. State 16,036 12,754 3,953 International 24,877 31,227 5,455 Total current 87,613 67,099 14,262 Deferred: U.S. Federal (18,753) (53,328) (7,684) U.S. State (7,866) (14,843) (4,543) International (28,684) (20,781) 14,428 Total deferred (55,303) (88,952) 2,201 Total income tax provision (benefit) $ 32,310 $ (21,853) $ 16,463 For the years ended December 31, 2022, 2021 and 2020, the Company recorded an income tax provision (benefit) of $32.3 million, $(21.9) million, and $16.5 million or an effective tax rate of (4.9)%, (4.6)%, and 4.5%, respectively. A reconciliation of the income tax provision (benefit) at the U.S. federal statutory income tax rate to the Company’s total income tax provision (benefit) is as follows (in thousands): Year Ended 2022 2021 2020 Income tax (benefit) provision at the federal statutory rate $ (139,015) $ 99,047 $ 76,799 State and local income taxes, net of federal benefit 10,516 11,134 7,693 Foreign income tax rate differential (89,903) (26,215) (13,193) Stock-based compensation (12,863) (83,207) (45,391) Research and development credit (19,603) (23,396) (15,156) U.S. tax on foreign earnings, net of foreign income deduction (1) 3,588 (5,155) 3,923 Non-deductible acquisition costs 1,204 5,643 — Non-deductible goodwill impairment 274,492 — — Other (2) 3,894 296 1,788 Total income tax provision (benefit) $ 32,310 $ (21,853) $ 16,463 (1) Previously disclosed as “U.S. tax reform” for the years ended December 31, 2021 and 2020. (2) Certain prior year amounts, which are not material, have been reclassified to conform to current year presentation. Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets (liabilities) are as follows (in thousands): As of December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 66,410 $ 48,689 Research and development credit carryforwards — 367 Capitalized research expenses 63,901 5,036 Convertible debt 40,159 47,142 Depreciation 7,051 42,019 Lease liability 33,253 35,871 Stock-based compensation expense 25,151 19,319 Accrued bonus 9,478 11,850 Excess tax basis in intangible assets 1,924 1,585 Other deferred tax assets 13,443 14,651 Total deferred tax assets 260,770 226,529 Less: valuation allowance 3,524 1,834 Total net deferred tax asset 257,246 224,695 Deferred tax liabilities: Excess book basis in intangible assets (147,790) (173,097) Right-of-use asset (31,864) (34,612) Other deferred tax liabilities (821) (607) Total deferred tax liabilities (180,475) (208,316) Net deferred tax assets $ 76,771 $ 16,379 As of December 31, 2022, the Company had the following tax credit and operating loss carryforwards available to offset income tax liability and taxable income, respectively, in future years (in thousands): December 31, 2022 Expiration Period U.S. Federal credit carryforwards $ 1,289 2031-2032 U.S. State net operating loss carryforwards 5,789 2031-Unlimited Non-U.S. net operating loss carryforwards 257,006 Unlimited Utilization of the net operating losses (“NOLs”) is dependent on generating sufficient taxable income from the Company’s operations in each of the respective jurisdictions to which the NOLs relate, while taking into account tax filing methodologies and limitations and/or restrictions on the Company’s ability to use them. A significant component of the Company’s Non-U.S. NOLs were acquired as part of the acquisition of Depop. Certain U.K. tax laws impose limitations on the utilization of these NOLs by any other entity. All NOLs are also subject to review by relevant tax authorities in the jurisdictions to which they relate. The Company assesses the likelihood of its ability to realize the benefit of its deferred tax assets in each jurisdiction by evaluating all relevant positive and negative evidence at each reporting date. To the extent the Company determines that some or all of its deferred tax assets are not more likely than not to be realized, it establishes a valuation allowance. The following table summarizes the valuation allowance activity for the periods indicated (in thousands): Year Ended 2022 2021 2020 Balance as of the beginning of period $ 1,834 $ 1,398 $ 883 Additions charged to expense 1,796 580 506 Deletions credited to expense — (112) (101) Currency translation and other balance sheet activity (106) (32) 110 Balance as of the end of period $ 3,524 $ 1,834 $ 1,398 Unrecognized tax benefits The following table summarizes the unrecognized tax benefit activity for the periods indicated (in thousands): As of December 31, 2022 2021 2020 Balance as of the beginning of period $ 28,842 $ 23,738 $ 19,933 Additions based on tax positions related to the current year 5,206 5,024 2,507 Additions for tax positions of prior years 1,754 122 1,576 Reductions for tax provisions of prior years (509) — (278) Settlements (107) — — Currency translation (28) (42) — Balance as of the end of period $ 35,158 $ 28,842 $ 23,738 The amount of unrecognized tax benefits included on the Consolidated Balance Sheets as of December 31, 2022, 2021, and 2020 are $35.2 million, $28.8 million, and $23.7 million, respectively. The total amount of unrecognized tax benefits that, if recognized, would favorably affect the effective tax rate is $34.1 million at December 31, 2022. The total amount of unrecognized tax benefits relating to the Company’s tax positions is subject to change based on future events including, but not limited to, the settlements of ongoing audits and/or the expiration of applicable statutes of limitations. The outcomes and timing of such events are highly uncertain. However, the Company’s reasonable estimate of the range of gross unrecognized tax benefits, excluding interest and penalties, that could potentially be reduced during the next 12 months is $2.1 million. The Company is subject to taxation in the United States, New York, and various other states and foreign jurisdictions. As of December 31, 2022, tax year 2014 and later remain open to examination. The Company is under examination by the IRS for calendar year 2014 through 2017. These examinations may result in proposed adjustments to the Company’s income tax liability or tax attributes with respect to years under examination as well as subsequent periods. The provision for income taxes involves a significant amount of management judgment regarding interpretation of relevant facts and laws in the jurisdictions in which the Company operates. Future changes in applicable laws, projected levels of taxable income and tax planning could change the effective tax rate and tax balances recorded by the Company. In addition, tax authorities periodically review income tax returns filed by the Company and can raise issues regarding its filing positions, timing and amount of income and deductions, and the allocation of income among the jurisdictions in which the Company operates. A significant period of time may elapse between the filing of an income tax return and the ultimate resolution of an issue raised by a revenue authority with respect to that return. Any adjustments as a result of any examination may result in additional taxes or penalties against the Company. If the ultimate result of these audits differ from original or adjusted estimates, they could have a material impact on the Company’s tax provision. |
Net (Loss) Income Per Share
Net (Loss) Income Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income Per Share | Note 4—Net (Loss) Income Per Share The following table presents the calculation of basic and diluted net (loss) income per share for periods presented (in thousands, except share and per share amounts): Year Ended 2022 2021 2020 Numerator: Net (loss) income $ (694,288) $ 493,507 $ 349,246 Add back interest expense, net of tax attributable to assumed conversion of convertible senior notes — 4,900 17,880 Net (loss) income attributable to common stockholders—diluted $ (694,288) $ 498,407 $ 367,126 Denominator: Weighted average common shares outstanding—basic 126,778,626 127,224,974 121,251,588 Dilutive effect of assumed conversion of options to purchase common stock — 4,149,248 4,492,550 Dilutive effect of assumed conversion of restricted stock units — 1,995,336 2,046,981 Dilutive effect of assumed conversion of convertible senior notes — 13,313,766 8,623,473 Weighted average common shares outstanding—diluted 126,778,626 146,683,324 136,414,592 Net (loss) income per share attributable to common stockholders—basic $ (5.48) $ 3.88 $ 2.88 Net (loss) income per share attributable to common stockholders—diluted $ (5.48) $ 3.40 $ 2.69 The following potential shares of common stock were excluded from the calculation of diluted net (loss) income per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Year Ended 2022 2021 2020 Stock options 3,127,333 149,683 3,711 Restricted stock units 5,081,194 584,033 71 Convertible senior notes 14,715,935 — 8,625,771 Total anti-dilutive securities 22,924,462 733,716 8,629,553 Since the Company has reported a net loss for the year ended December 31, 2022, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders, because dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. The following table presents the method used when calculating the impact of the Company’s Notes on earnings per share for the periods presented: Year Ended 2022 2021 2020 2021 Notes If-Converted If-Converted N/A 2020 Notes If-Converted If-Converted Treasury Stock 2019 Notes If-Converted If-Converted If-Converted 2018 Notes If-Converted If-Converted If-Converted |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Note 5—Business Combinations The Company accounts for business combinations using the acquisition method of accounting. The purchase price is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. The excess of the purchase price over the estimated fair value of the net assets acquired is recorded as goodwill. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of acquisition. The fair value of customer relationships is estimated using a multi-period excess earnings valuation method, the fair value of trademarks is estimated using a relief from royalty valuation method, and the fair value of developed technology is estimated using a replacement cost method. Depop Acquisition On July 12, 2021, the Company acquired all of the issued share capital of Depop, an online global peer-to-peer fashion resale marketplace. The Company believes Depop extends its market opportunity in the high frequency apparel sector, specifically in the fast-growing resale space, and deepens the Company’s reach into the Gen Z consumer. The fair value of consideration transferred of $1.493 billion consisted of: (1) cash consideration paid of $1.489 billion, net of cash acquired and (2) non-cash consideration of $4.8 million representing the portion of the replacement equity awards issued in connection with the acquisition that was associated with services rendered through the date of the acquisition. The portion of the replacement equity awards associated with services rendered post-acquisition is recorded as post-combination expense on a straight-line basis over the remaining vesting period of the awards. Additionally, deferred consideration awards issued to certain Depop executives are also recorded as post-combination expense on a straight-line basis over the mandatory service period associated with the deferred consideration. Neither of these awards was included in the fair value of the consideration transferred. See Note 15—Stock-based Compensation for more information on these awards. Goodwill consists largely of assembled workforce, expanded market opportunities, and value creation across the Company’s businesses. The resulting goodwill is not expected to be deductible for tax purposes. The Company finalized the valuation of assets acquired and liabilities assumed for the acquisition of Depop as of December 31, 2021. Depop Purchase Price Allocation The following table summarizes the allocation of the purchase price (at fair value), including measurement period adjustments, to the assets acquired and liabilities assumed of Depop as of July 12, 2021 (the date of acquisition) (in thousands): Final Purchase Price Allocation as Adjusted Estimated Useful Life (in years) Current assets $ 4,288 Property and equipment other 1,299 2-5 Developed technology 95,764 5 Trademark 249,820 20 Customer relationships 148,504 13 Goodwill 1,118,855 Indefinite Current liabilities (18,878) Non-current liabilities (1) (27,957) Deferred tax liability, net (78,872) Total purchase price 1,492,823 (1) Non-current liabilities are primarily related to non-income tax related contingency reserves. Elo7 Acquisition On July 2, 2021, the Company acquired all the outstanding shares of Elo7 (including Elo7, Ltd. and related subsidiaries entities), by means of a merger, an e-commerce marketplace in Brazil focused on unique, handmade items. The Company sees significant potential in Brazil's e-commerce sector, which is still in early stages of development and fueled by one of the largest economies in the world. The Company believes having a well-known local brand will help Etsy to better capitalize on this opportunity. The fair value of consideration transferred of $212.1 million consisted of: (1) cash consideration paid of $211.3 million, net of cash acquired, and (2) non-cash consideration of $0.8 million representing the portion of the replacement equity awards issued in connection with the acquisition that was associated with services rendered through the date of the acquisition. The portion of the replacement equity awards associated with services rendered post-acquisition are recorded as post-combination expense on a straight-line basis over the remaining vesting period of the awards, and were therefore not included in the fair value of the consideration transferred. See Note 15—Stock-based Compensation for more information on these awards. Goodwill consists largely of assembled workforce, expanded market opportunities, and value creation across the Company’s businesses. The resulting goodwill is not expected to be deductible for tax purposes. The Company finalized the valuation of assets acquired and liabilities assumed for the acquisition of Elo7 as of December 31, 2021. Elo7 Purchase Price Allocation The following table summarizes the allocation of the purchase price (at fair value), including measurement period adjustments, to the assets acquired and liabilities assumed of Elo7 as of July 2, 2021 (the date of acquisition) (in thousands): Final Purchase Price Allocation as Adjusted Estimated Useful Life (in years) Current assets $ 2,721 Developed technology 12,084 5 Trademark 22,187 15 Customer relationships 44,374 15 Goodwill 157,187 Indefinite Non-current assets 2,412 Current liabilities (3,406) Non-current liabilities (2,691) Deferred tax liability, net (22,727) Total purchase price $ 212,141 Revenue and Earnings Revenue and net loss were $36.7 million and $59.1 million, respectively, for Depop and Elo7, in the aggregate, from their respective dates of acquisition through December 31, 2021. Acquisition-related expenses are expensed as incurred and were recorded in general and administrative expenses. They were $2.8 million and $36.7 million for the years ended December 31, 2022 and 2021, respectively. The 2021 acquisition-related expenses primarily related to advisory, legal, valuation, and other professional fees. Unaudited Supplemental Pro Forma Information The following unaudited pro forma summary presents consolidated information of the Company, including Depop and Elo7, as if the business combinations had occurred on January 1, 2020 (in thousands): Year Ended December 31, 2021 2020 Revenue $ 2,373,592 $ 1,801,690 Net income 492,732 319,669 The pro forma financial information includes adjustments that are directly attributable to the business combinations and are factually supportable. The pro forma adjustments include incremental amortization of intangible and developed technology assets, and remove non-recurring transaction costs directly associated with the acquisitions, such as legal and other professional service fees, and the pro forma tax impact for such adjustments. Cost savings or operating synergies expected to result from the acquisitions are not included in the pro forma results. For the year ended December 31, 2021, the pro forma financial information excludes $60.1 million of non-recurring acquisition-related expenses related to the Depop and Elo7 acquisitions. For the year ended December 31, 2020, the pro forma financial information includes $2.4 million of non-recurring acquisition-related expenses incurred post effective dates of the Depop and Elo7 business combinations. These pro forma results are illustrative only and not indicative of the actual results of operations that would have been achieved nor are they indicative of future results of operations. Depop and Elo7 Goodwill Impairment During the year ended December 31, 2022, the Company fully impaired goodwill related to the Depop and Elo7 acquisitions. See “Note 6—Goodwill and Intangible Assets” for further information. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Note 6—Goodwill and Intangible Assets The following table summarizes the changes in the carrying amount of goodwill for the periods indicated (in thousands): Year Ended 2022 2021 Balance as of the beginning of the period $ 1,371,064 $ 140,810 Business combinations — 1,276,042 Impairment (1,045,022) — Foreign currency translation adjustments (188,318) (45,788) Balance as of the end of the period $ 137,724 $ 1,371,064 Management has determined that the Company has four operating segments, Etsy, Reverb, Depop, and Elo7, and each operating segment is determined to be a reporting unit. As of June 30, 2022, due to then current adverse macroeconomic conditions, including reopening, inflationary pressures on consumer discretionary spending, foreign exchange rate volatility, and ongoing geopolitical events, and related headwinds on business performances, the Company concluded it was more likely than not that the fair values of the Depop and Elo7 reporting units were less than their carrying amounts. As a result, the Company performed impairment assessments of each of their goodwill, finite-lived intangible assets, and other long-lived assets. The quantitative impairment tests as of June 30, 2022 did not indicate an impairment. During the three months ended September 30, 2022, the trend of adverse macroeconomic conditions continued; there were executive management changes at Depop and Elo7; and the Company made downward revisions to its business forecasts. Therefore, the Company concluded a triggering event had occurred for the Depop and Elo7 reporting units and conducted an impairment test of each of their goodwill, finite-lived intangible assets, and other long-lived assets as of September 30, 2022. The Company prepared a quantitative assessment for the Depop and Elo7 reporting units. The fair value of the Depop and Elo7 reporting units was estimated using an income approach and included assumptions related to estimates of future revenue, net available cash flows, the long-term growth rates, and discount rates. The Company updated the forecasted future cash flows used in the impairment assessment, including revenues, to reflect current conditions. Other changes in valuation assumptions compared to June 30, 2022 included the discount rates, which increased based on higher interest rates, market volatility, and other current market participant assumptions. The September 30, 2022 quantitative goodwill impairment test indicated a decline in the fair values of the Depop and Elo7 reporting units. As a result of this test, the Company recorded non-cash impairment charges of $897.9 million and $147.1 million to write off goodwill in full for the Depop and Elo7 reporting units, respectively. The Company did not record any non-cash impairment charges to the finite-lived intangible assets or other long-lived assets of Depop and Elo7 for the quarter ended September 30, 2022. The Company’s remaining goodwill balance as of September 30, 2022 related to the Etsy and Reverb reporting units, for which the Company concluded it was not more likely than not that their fair values were less than their carrying amounts at September 30, 2022. As of the annual impairment testing date in 2022, two of the Company’s four reporting units had goodwill; Etsy and Reverb, as the goodwill was written off in full for the Depop and Elo7 reporting units as of September 30, 2022. The Company completed a qualitative analysis for both the Etsy and the Reverb reporting units, and concluded that there was no goodwill impairment as of the annual impairment testing date in 2022. For the twelve months ended December 31, 2022, the Company recorded $1.0 billion of goodwill impairment expense, and for the twelve months ended 2021 and 2020 the Company did not record any goodwill impairment expense. At December 31, 2022 and 2021, the gross book value and accumulated amortization of intangible assets were as follows (in thousands): As of December 31, 2022 Gross book Accumulated Net book Weighted-Average Trademark $ 318,489 $ (35,873) $ 282,616 16.7 Customer relationships 265,429 (39,808) 225,621 11.9 Referral agreement 34,050 (15,404) 18,646 5.5 Patent licenses 9,617 (1,094) 8,523 9.9 Intangible assets $ 627,585 $ (92,179) $ 535,406 14.2 As of December 31, 2021 Gross book Accumulated Net book Weighted-Average Trademark $ 342,753 $ (18,817) $ 323,936 17.8 Customer relationships 278,311 (21,243) 257,068 12.9 Referral agreement 36,109 (12,677) 23,432 6.5 Patent licenses 3,149 (415) 2,734 5.6 Intangible assets $ 660,322 $ (53,152) $ 607,170 15.2 As part of the acquisitions of Depop and Elo7 in 2021, the Company recorded acquired intangible assets for customer relationships and trademark. See “Note 5—Business Combinations” for additional information on the acquisitions of Depop and Elo7. Amortization expense of intangible assets for the years ended December 31, 2022, 2021, and 2020 was $41.3 million, $28.4 million, and $15.2 million, respectively. The Company did not recognize any intangible asset impairment losses in the years ended December 31, 2022, 2021, and 2020. Based on amounts recorded at December 31, 2022, the Company estimates future amortization expense of intangible assets as follows (in thousands): 2023 $ 41,134 2024 41,123 2025 41,123 2026 40,802 2027 40,734 Thereafter 330,490 Total amortization expense $ 535,406 |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Note 7—Segment and Geographic Information The Company has determined it has four operating segments, Etsy, Reverb, Depop, and Elo7, which qualify for aggregation as one reportable segment. Revenue by country is based on the billing address of the seller. The following table summarizes revenue by geographic area (in thousands): Year Ended 2022 2021 2020 United States $ 1,429,650 $ 1,393,637 $ 1,150,725 United Kingdom 343,788 329,203 195,827 All Other 792,673 606,274 379,073 Revenue $ 2,566,111 $ 2,329,114 $ 1,725,625 With the exception of the United States and United Kingdom, no individual country’s revenue exceeded 10% of total revenue. All significant tangible long-lived assets are located in the United States. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 8—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 Sheets 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 Company did not have any Level 3 instruments as of December 31, 2022 and December 31, 2021. Short- and long-term investments and certain cash equivalents consist of investments in debt securities that are available-for-sale. The following table sets forth the cost, gross unrealized losses, gross unrealized gains, and fair values of the Company’s investments as of the dates indicated (in thousands): Cost Gross Gross Fair Value Cash and Cash Equivalents Short-term Investments Long-term Investments December 31, 2022 Level 1 Money market funds (1) $ 462,866 $ — $ — $ 462,866 $ 374,314 $ 76 $ — U.S. Government securities 64,968 (424) 4 64,548 2,995 61,553 — 527,834 (424) 4 527,414 377,309 61,629 — Level 2 U.S. agency securities 10,053 (1) 3 10,055 — 10,055 — Certificate of deposit 40,915 (184) 7 40,738 5,471 35,267 — Commercial paper 57,777 (101) 18 57,694 4,454 53,240 — Corporate bonds 122,294 (1,729) 6 120,571 1,212 90,222 29,137 231,039 (2,015) 34 229,058 11,137 188,784 29,137 $ 758,873 $ (2,439) $ 38 $ 756,472 $ 388,446 $ 250,413 $ 29,137 December 31, 2021 Level 1 Money market funds 556,427 — — 556,427 556,427 — — U.S. Government securities 60,311 (55) 11 60,267 — 52,632 7,635 616,738 (55) 11 616,694 556,427 52,632 7,635 Level 2 Certificate of deposit 20,709 (7) 1 20,703 — 20,703 — Commercial paper 25,235 (14) 1 25,222 8,998 16,224 — Corporate bonds 192,727 (481) 10 192,256 — 114,857 77,399 238,671 (502) 12 238,181 8,998 151,784 77,399 $ 855,409 $ (557) $ 23 $ 854,875 $ 565,425 $ 204,416 $ 85,034 (1) $88.5 million of money market funds were classified as funds receivable and seller accounts as of December 31, 2022. There were no money market funds classified as funds receivable and seller accounts as of December 31, 2021. The table below shows the gross unrealized loss and fair value of the following investments in available-for-sale debt securities that are classified by the length of time that the securities have been in a continuous unrealized loss position at December 31, 2022 (in thousands): Gross Fair Value Less than 12 months in a continuous unrealized loss position Corporate bonds $ (281) $ 70,469 U.S. Government securities (265) 51,075 $ (546) $ 121,544 12 months or longer in a continuous unrealized loss position Corporate bonds $ (1,448) $ 50,102 U.S. Government securities (159) 7,442 $ (1,607) $ 57,544 The remaining available-for-sale debt securities in an unrealized loss position have been in a continuous unrealized loss position for less than 12 months. At December 31, 2021, there were no investments in a continuous unrealized loss position for 12 months or longer. The Company evaluates fair value for each individual security in the investment portfolio. When assessing the risk of credit loss, the Company considers factors such as the extent to which the fair value is less than the amortized cost basis, the credit rating, including whether there has been any changes to the rating of the security by a rating agency, available information relevant to the collectability of the security, and management’s intended holding period and time horizon for selling the security. The Company did not recognize a credit loss in the years ended December 31, 2022, 2021, and 2020. The Company typically invests in short- and long-term instruments, including fixed-income funds and U.S. Government securities aligned with the Company’s investment strategy. The maturities of the Company’s non-current marketable debt securities generally range from greater than 12 and up to 37 months. Disclosure of Fair Values The Company’s financial instruments that are not remeasured at fair value in the Consolidated Balance Sheets include the Notes. See “Note 12—Debt” for additional information. The Company estimates the fair value of the Notes through inputs that are observable in the market, classified as Level 2 as described above. The following table presents the carrying value and estimated fair value of the Notes as of the dates indicated (in thousands): As of December 31, 2022 As of December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value 2021 Notes $ 989,629 $ 863,300 $ 987,729 $ 1,165,519 2020 Notes 644,431 646,230 643,237 $ 862,774 2019 Notes 645,536 998,361 644,390 1,644,869 2018 Notes (1) 44 145 62 375 $ 2,279,640 $ 2,508,036 $ 2,275,418 $ 3,673,537 (1) Contemporaneously with the partial repurchase of the 2018 Notes in the third quarter of 2020, the Company agreed with the counterparties to the associated capped call instrument (the “2018 Capped Call Transactions”) that the 2018 Capped Call Transactions would remain outstanding with a maturity of March 2023 and there was no exchange of any consideration for such agreement. See “Note 12—Debt” for more information on the Company’s capped call transactions. The carrying value of other financial instruments, including accounts receivable, funds receivable and seller accounts, accounts payable, and funds payable and amounts due to sellers approximate fair value due to the immediate or short-term maturity associated with these instruments. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 9—Property and Equipment Property and equipment consisted of the following as of the dates indicated (in thousands): As of December 31, Estimated useful lives 2022 2021 Computer equipment 3 years $ 12,820 $ 8,037 Furniture and equipment 2 - 4 years 11,398 7,170 Leasehold improvements Shorter of life of asset or lease term 56,095 48,145 Construction in progress Not applicable 419 10,835 Building Lease term 133,063 133,063 Website development and internal-use software 3 - 5 years 240,138 224,855 453,933 432,105 Less: Accumulated depreciation and amortization 204,189 157,043 $ 249,744 $ 275,062 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Note 10—Leases For the years ended December 31, 2022, 2021, and 2020, the elements of lease expense were as follows (in thousands): Year Ended 2022 2021 2020 Operating lease cost $ 8,251 $ 6,320 $ 5,847 Finance lease cost: Amortization of right-of-use assets 7,174 9,139 10,190 Interest on lease liabilities 5,392 3,044 2,576 Total finance lease cost 12,566 12,183 12,766 Other lease cost, net (1) 1,220 1,193 1,322 Total lease cost $ 22,037 $ 19,696 $ 19,935 (1) Other lease cost, net includes short-term lease costs and variable lease costs. The following table presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheets (in thousands): As of December 31, 2022 2021 Operating leases: Other assets $ 38,784 $ 45,951 Other current liabilities $ 4,233 $ 4,018 Other liabilities 38,085 43,746 Total operating lease liabilities $ 42,318 $ 47,764 Finance leases: Property and equipment, net $ 102,169 $ 109,131 Finance lease obligations—current $ 4,731 $ 2,418 Finance lease obligations—net of current portion 105,699 110,283 Total finance lease liabilities $ 110,430 $ 112,701 The following table summarizes the weighted average remaining lease term and weighted average discount rate as of December 31, 2022 and 2021: As of December 31, 2022 2021 Weighted average remaining lease term: Operating leases 14.54 years 14.67 years Finance leases 16.49 years 17.41 years Weighted average discount rate: Operating leases 4.54 % 4.46 % Finance leases 4.73 % 4.72 % Supplemental cash flow information related to leases was as follows (in thousands): Year Ended 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ (7,871) $ (6,442) $ (5,519) Operating cash flows used in finance leases (5,387) (3,025) (2,551) Finance cash flows used in finance leases (6,307) (8,864) (9,211) Future minimum lease payments under non-cancelable leases as of December 31, 2022 were as follows (in thousands): Operating Leases Finance Leases 2023 $ 5,783 $ 9,036 2024 6,190 10,999 2025 5,428 10,760 2026 778 100 2027 272 882 Thereafter 41,565 134,997 Total future minimum lease payments (1) 60,016 166,774 Less: Imputed interest 17,698 56,344 Total $ 42,318 $ 110,430 (1) In the fourth quarter of 2021, the Company entered into a First Amendment to Lease (the “First Amendment”) related to the Company’s corporate headquarters in Brooklyn, New York, a portion of which is accounted for as a finance lease and a portion as an operating lease. The First Amendment extended the expiration of the term of the lease from July 31, 2026 to July 31, 2039. The First Amendment includes a tenant allowance, a portion of which became available beginning in April 2022, rent concessions that become available beginning in 2026, and escalating commitments each contract year between 2028 and 2038, which are reflected in the future minimum lease payments. |
Leases | Note 10—Leases For the years ended December 31, 2022, 2021, and 2020, the elements of lease expense were as follows (in thousands): Year Ended 2022 2021 2020 Operating lease cost $ 8,251 $ 6,320 $ 5,847 Finance lease cost: Amortization of right-of-use assets 7,174 9,139 10,190 Interest on lease liabilities 5,392 3,044 2,576 Total finance lease cost 12,566 12,183 12,766 Other lease cost, net (1) 1,220 1,193 1,322 Total lease cost $ 22,037 $ 19,696 $ 19,935 (1) Other lease cost, net includes short-term lease costs and variable lease costs. The following table presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheets (in thousands): As of December 31, 2022 2021 Operating leases: Other assets $ 38,784 $ 45,951 Other current liabilities $ 4,233 $ 4,018 Other liabilities 38,085 43,746 Total operating lease liabilities $ 42,318 $ 47,764 Finance leases: Property and equipment, net $ 102,169 $ 109,131 Finance lease obligations—current $ 4,731 $ 2,418 Finance lease obligations—net of current portion 105,699 110,283 Total finance lease liabilities $ 110,430 $ 112,701 The following table summarizes the weighted average remaining lease term and weighted average discount rate as of December 31, 2022 and 2021: As of December 31, 2022 2021 Weighted average remaining lease term: Operating leases 14.54 years 14.67 years Finance leases 16.49 years 17.41 years Weighted average discount rate: Operating leases 4.54 % 4.46 % Finance leases 4.73 % 4.72 % Supplemental cash flow information related to leases was as follows (in thousands): Year Ended 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ (7,871) $ (6,442) $ (5,519) Operating cash flows used in finance leases (5,387) (3,025) (2,551) Finance cash flows used in finance leases (6,307) (8,864) (9,211) Future minimum lease payments under non-cancelable leases as of December 31, 2022 were as follows (in thousands): Operating Leases Finance Leases 2023 $ 5,783 $ 9,036 2024 6,190 10,999 2025 5,428 10,760 2026 778 100 2027 272 882 Thereafter 41,565 134,997 Total future minimum lease payments (1) 60,016 166,774 Less: Imputed interest 17,698 56,344 Total $ 42,318 $ 110,430 (1) In the fourth quarter of 2021, the Company entered into a First Amendment to Lease (the “First Amendment”) related to the Company’s corporate headquarters in Brooklyn, New York, a portion of which is accounted for as a finance lease and a portion as an operating lease. The First Amendment extended the expiration of the term of the lease from July 31, 2026 to July 31, 2039. The First Amendment includes a tenant allowance, a portion of which became available beginning in April 2022, rent concessions that become available beginning in 2026, and escalating commitments each contract year between 2028 and 2038, which are reflected in the future minimum lease payments. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Note 11—Accrued Expenses Accrued expenses consisted of the following as of the dates indicated (in thousands): As of December 31, 2022 2021 Pass-through marketplace tax collection obligation $ 129,591 $ 136,360 Vendor accruals 127,791 115,593 Employee compensation-related liabilities 63,718 66,477 Taxes payable 10,134 9,688 Total accrued expenses $ 331,234 $ 328,118 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Note 12—Debt The following table presents the outstanding principal amount and carrying value of the Notes as of the dates indicated (in thousands): As of December 31, 2022 2021 Notes 2020 Notes 2019 Notes 2018 Notes Total Principal $ 1,000,000 $ 650,000 $ 649,932 $ 44 $ 2,299,976 Unamortized debt issuance costs 10,371 5,569 4,396 — 20,336 Net carrying value $ 989,629 $ 644,431 $ 645,536 $ 44 $ 2,279,640 As of December 31, 2021 2021 Notes 2020 Notes 2019 Notes 2018 Notes Total Principal $ 1,000,000 $ 650,000 $ 649,958 $ 62 $ 2,300,020 Unamortized debt issuance costs 12,271 6,763 5,568 — 24,602 Net carrying value $ 987,729 $ 643,237 $ 644,390 $ 62 $ 2,275,418 Terms of the Notes The Notes will mature at their maturity date unless earlier converted, redeemed or repurchased. The terms of the Notes are summarized below: Convertible Notes Maturity Date Contractual Convertibility Date (1) Initial Conversion Rate per $1,000 Principal (2) Initial Conversion Price Annual Effective Interest Rate 2021 Notes June 15, 2028 February 15, 2028 4.0518 $ 246.80 0.4 % 2020 Notes September 1, 2027 May 1, 2027 5.0007 199.97 0.3 % 2019 Notes October 1, 2026 June 1, 2026 11.4040 87.69 0.3 % 2018 Notes March 1, 2023 November 1, 2022 27.5691 36.27 — % (1) During any calendar quarter preceding the respective contractual convertibility date of each series of Notes, 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 quarter ended December 31, 2022, holders of the remaining 2019 Notes and 2018 Notes are eligible to convert their 2019 Notes and 2018 Notes, and holders of the 2021 Notes and 2020 Notes are not eligible to convert their 2021 Notes and 2020 Notes respectively, during the first quarter of 2023. (2) The initial conversion rate will be subject to adjustment upon the occurrence of certain specified events, including certain distributions and dividends to all or substantially all of the holders of the Company’s common stock. Based on the terms of each series of Notes, they will mature on the respective maturity date, unless earlier converted, redeemed, or repurchased. Additionally, the holders of each series of Notes may convert all or a portion of the Notes prior to the close of business on the business day immediately preceding the respective contractual convertibility date only under the following circumstances (in each case, as applicable to each series of Notes): (1) during any calendar quarter commencing after the calendar quarter ending on September 30, 2021, December 31, 2020, December 31, 2019, and June 30, 2018 (and only such calendar quarter) for the 2021 Notes, 2020 Notes, remaining 2019 Notes, and remaining 2018 Notes, respectively, if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the 5 business day period after any 10 consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of the Note for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; (3) if the Company calls the Notes for redemption at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date, but only with respect to the Notes called (or deemed called) for redemption; or (4) upon the occurrence of specified corporate events. On and after the applicable contractual convertibility date until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Notes at any time, regardless of the foregoing circumstances. The Notes are general unsecured obligations of the Company. The Notes rank senior in right of payment to all of the Company’s future indebtedness that is expressly subordinated in right of payment to the Notes; rank equal in right of payment with all of the Company’s liabilities that are not so subordinated; are effectively junior to any of the Company’s secured indebtedness; and are structurally junior to all indebtedness and liabilities (including trade payables) of the Company’s subsidiaries. Based on the terms of each series of Notes, when a conversion notice is received, the Company has the option to pay or deliver cash, shares of the Company’s common stock, or a combination thereof. Accordingly, the Company cannot be required to settle the Notes in cash and, therefore, the Notes are classified as long-term debt as of December 31, 2022. 2021 Convertible Debt In June 2021, the Company issued $1.0 billion aggregate principal amount of the 2021 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 2021 Notes were approximately $986.7 million after deducting the initial purchasers’ discount and offering expenses and before the 2021 Capped Call Transactions, as described below, and the repurchase of stock, as described in “Note 14—Stockholders’ Equity.” The Company used $85.0 million of the net proceeds from the 2021 Notes to enter into privately negotiated capped call instruments (“2021 Capped Call Transactions”) with certain financial institutions. The Company may redeem all or any portion of the 2021 Notes, at the Company’s option, subject to partial redemption limitations, on or after June 20, 2025, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which the Company provides notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the 2021 Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. If a fundamental change occurs prior to the maturity date, holders may require the Company to repurchase all or a portion of their 2021 Notes for cash at a price equal to 100% of the principal amount of the 2021 Notes to be repurchased. Holders of 2021 Notes who convert their 2021 Notes in connection with a notice of a redemption or a make-whole fundamental change may be entitled to a premium in the form of an increase in the conversion rate of the 2021 Notes. As of December 31, 2022, none of the conditions permitting the holders of the 2021 Notes to early convert have been met. 2020 Convertible Debt In August 2020, the Company issued $650.0 million aggregate principal amount of the 2020 Notes in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The net proceeds from the sale of the 2020 Notes were approximately $639.5 million after deducting the offering expenses and before the purchase of the 2020 Capped Call Transactions and the partial repurchase of the 2018 Notes, each as described below. The Company used $74.7 million of the net proceeds from the 2020 Notes to enter into privately negotiated capped call instruments (“2020 Capped Call Transactions”) with certain financial institutions. If a fundamental change occurs prior to the maturity date, holders may require the Company to repurchase all or a portion of their 2020 Notes for cash at a price equal to 100% of the principal amount of the 2020 Notes to be repurchased. Holders of 2020 Notes who convert their 2020 Notes in connection with a notice of a redemption or a make-whole fundamental change may be entitled to a premium in the form of an increase in the conversion rate of the 2020 Notes. As of December 31, 2022, none of the conditions permitting the holders of the 2020 Notes to early convert have been met. 2019 Convertible Debt In September 2019, the Company issued $650.0 million aggregate principal amount of the 2019 Notes in a private placement to qualified institutional buyers pursuant to the Securities Act. The net proceeds from the sale of the 2019 Notes were $639.5 million after deducting the initial purchasers’ discount and offering expenses. The Company used $76.2 million of the net proceeds from the 2019 Notes offering to enter into separate capped call instruments (“2019 Capped Call Transactions”) with the initial purchasers and/or their respective affiliates. If a fundamental change occurs prior to the maturity date, holders may require the Company to repurchase all or a portion of their 2019 Notes for cash at a price equal to 100% of the principal amount of the 2019 Notes to be repurchased. Holders of 2019 Notes who convert their 2019 Notes in connection with a notice of a redemption or a make-whole fundamental change may be entitled to a premium in the form of an increase in the conversion rate of the 2019 Notes. 2018 Convertible Debt In March 2018, the Company issued $345.0 million aggregate principal amount of the 2018 Notes, in a private placement to qualified institutional buyers pursuant to the Securities Act. The net proceeds from the sale of the 2018 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 2018 Notes offering to enter into separate capped call instruments (“2018 Capped Call Transactions”) with the initial purchasers and/or their respective affiliates. If a fundamental change occurs prior to the maturity date, holders may require the Company to repurchase all or a portion of their 2018 Notes for cash at a price equal to 100% of the principal amount of the 2018 Notes to be repurchased. Holders of 2018 Notes who convert their 2018 Notes in connection with a notice of a redemption or a make-whole fundamental change may be entitled to a premium in the form of an increase in the conversion rate of the 2018 Notes. During the third quarter of 2020, the Company paid $137.2 million in cash and issued approximately 7.3 million shares of Etsy’s common stock to repurchase $301.1 million aggregate principal amount of its outstanding 2018 Notes through privately negotiated transactions. Concurrently, the Company repurchased 1.3 million shares of Etsy’s common stock for $166.2 million, in order to effectively complete the partial repurchase of 2018 Notes principal value in cash, and the conversion premium in shares. The equity component associated with the conversion premium on the 2018 Notes was a net increase to additional paid-in capital of $143.2 million. This transaction was accounted for as an extinguishment of debt and recorded in accordance with the applicable accounting standard in the year ended December 31, 2020. As a result, the Company recognized a non-cash loss on extinguishment of $16.9 million. This loss was calculated by comparing the carrying value of the debt component with the fair value of a similar liability that does not have an associated convertible feature immediately prior to extinguishment as well as writing off any remaining unamortized deferred debt issuance costs at the time of extinguishment. To estimate the fair value of a similar liability that does not have an associated convertible feature, the Company discounted the contractual cash flows of the Notes at an estimated interest rate for a comparable nonconvertible note. Contemporaneously with the partial repurchase of the 2018 Notes in the third quarter of 2020, the Company also agreed with its counterparties to the 2018 Capped Call Transactions that they would remain outstanding with a maturity of March 2023. This was mutually agreed to between Etsy and its counterparties and there was no exchange of any consideration for such agreement. During the year ended December 31, 2021, the Company paid $43.9 million in cash and issued approximately 1.0 million shares of Etsy’s common stock to settle conversion notices of $43.9 million aggregate principal amount of the outstanding 2018 Notes. The debt conversion transactions were accounted for in accordance with ASU 2020-06, which was adopted in the first quarter of 2021. Interest Expense Interest expense related to each of the Notes for the periods presented below was as follows (in thousands): Year Ended Convertible Notes 2022 2021 2020 2021 Notes $ 4,400 $ 2,411 $ — 2020 Notes $ 2,006 $ 2,006 $ 6,741 2019 Notes $ 1,985 $ 1,985 $ 21,441 2018 Notes $ — $ 44 $ 10,987 Total interest expense (1) $ 8,391 $ 6,446 $ 39,169 (1) Total interest expense for the year ended December 31, 2022 and 2021 consisted of coupon interest and amortization of debt issuance costs, as there is no amortization of the debt discount since January 1, 2021 due to the adoption of ASU 2020-06 as of January 1, 2021. In accounting for the issuance of the 2020 Notes, 2019 Notes, and 2018 Notes, the Company separated the liability and equity components. Following the adoption of ASU 2020-06 in the first quarter of 2021, the Company derecognized the unamortized debt discount, which was recorded as a direct deduction from the Notes, and derecognized the equity component of the Notes, resulting in an increase in long-term debt, net. In accounting for the issuance of the 2021 Notes, the Company recorded the 2021 Notes as a liability at face value. Transaction costs attributable to the liabilities were recorded as a direct deduction from the related debt liability in the Consolidated Balance Sheets and are amortized to interest expense over the terms of the respective Notes. Fair Value of Notes The estimated fair value of the liability component of the Notes was determined through inputs that are observable in the market, and are classified as Level 2. See “Note 8—Fair Value Measurements ” for more information regarding the fair value of the Notes. Capped Call Transactions The Company used a portion of the net proceeds from each of the Notes offerings to enter into separate privately negotiated capped call instruments (the 2018, 2019, 2020, and 2021 capped call instruments collectively referred to as the “Capped Call Transactions”) with certain financial institutions, initial purchasers, and/or their respective affiliates. The Capped Call Transactions are expected generally to reduce the potential dilution and/or offset the cash payments the Company is required to make in excess of the principal amount of the Notes upon conversion of the Notes in the event that the market price per share of the Company’s common stock is greater than the strike price of the Capped Call Transactions with such reduction and/or offset subject to a cap. Collectively, the Capped Call Transactions cover, initially, the number of shares of the Company’s common stock underlying the respective Notes, subject to anti-dilution adjustments substantially similar to those applicable to the Notes. The initial terms of the Company’s Capped Call Transactions are presented below: Capped Call Transactions Maturity Date Initial Cap Price per Share Cap Price Premium 2021 Capped Call Transactions June 15, 2028 $ 340.42 100 % 2020 Capped Call Transactions September 1, 2027 327.83 150 % 2019 Capped Call Transactions October 1, 2026 148.63 150 % 2018 Capped Call Transactions March 1, 2023 52.76 100 % Each series of the Capped Call Transactions do not meet the criteria for separate accounting as a derivative as they are indexed to the Company’s stock. The premiums paid for each of the Capped Call Transactions have been included as a net reduction to additional paid-in capital within stockholders’ equity. 2019 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 periods. The 2019 Credit Agreement contains customary provisions for the replacement of the adjusted LIBOR rate with an alternate benchmark rate (to be the Secured Overnight Financing Rate) when the adjusted LIBOR rate is phased out in the lending market on June 30, 2023. The Company does not anticipate that replacement of the benchmark rate, as provided in the 2019 Credit Agreement, will materially impact its liquidity or financial position. 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. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13—Commitments and Contingencies Purchase Obligations The Company has $388.3 million of non-cancelable contractual commitments as of December 31, 2022, primarily related to cloud computing in which the commitments are due over the course of approximately four years. For agreements with variable terms, the Company does not estimate what the total obligation may be beyond any minimum quantities and/or pricing. For purchase obligations with cancellation provisions, the amounts included in the following table were limited to the non-cancelable portion of the agreement terms or the minimum cancellation fees. The Company’s future payments under purchase obligations as of December 31, 2022 were as follows (in thousands): Purchase Obligations Periods ending 2023 $ 61,319 2024 115,148 2025 132,310 2026 71,295 2027 1,295 Thereafter 6,969 Total purchase obligations $ 388,336 Non-Income Tax Contingencies The Company had reserves of $43.2 million and $38.8 million at December 31, 2022 and 2021, respectively, for certain non-income tax obligations, representing management’s best estimate of its potential liability. The reserves as of December 31, 2022 and 2021 include $30.4 million and $32.3 million, respectively, due to the acquisitions of Reverb, Depop and Elo7, some of which are offset by an indemnification asset of $3.0 million and $3.8 million, respectively. These amounts were primarily recorded as part of purchase accounting. The Company could also be subject to examination in various jurisdictions related to income tax and non-income tax matters. The resolution of these types of matters, if in excess of the recorded reserve, could have an adverse impact on the Company’s consolidated financial statements. Legal Proceedings From time to time in the normal course of business, various other 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 could have an adverse effect on the Company’s 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, the Company currently believes that the final outcome of these ordinary course matters will not have a material adverse effect on its business. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | Note 14—Stockholders’ Equity Common Stock At December 31, 2022 and 2021, the authorized capital stock of the Company included 1,400,000,000 shares of common stock. At December 31, 2022 and 2021 there were 125,054,278 and 127,022,118 shares of common stock issued and outstanding, respectively. The common stock has a $0.001 par value. Holders of common stock are entitled to one vote per share. Holders of common stock are not entitled to receive dividends unless declared by the Board of Directors. No dividends have been declared through December 31, 2022. Preferred Stock At December 31, 2022 and 2021 the authorized capital stock of the Company included 25,000,000 shares of preferred stock. As of December 31, 2022, 2021, and 2020, there was no preferred stock outstanding. Stock Repurchases In May 2022, the Board of Directors approved a stock repurchase program that enables the Company to repurchase up to $600 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. As of December 31, 2022, the remaining amount available to be repurchased under the approved plan was $301.4 million. In December 2020, the Board of Directors approved a stock repurchase program that enabled the Company to repurchase up to $250 million of its common stock. The program was completed in the third quarter of 2022. In November 2018, the Board of Directors approved a stock repurchase program that enabled the Company to repurchase up to $200 million of its common stock. The program was completed in the fourth quarter of 2020. The following table summarizes the Company’s stock repurchase activity related to the programs noted above: Shares Repurchased Average Price Paid per Share (1) Repurchases of common stock for the year ended December 31, 2022 3,958,155 107.56 Repurchases of common stock for the year ended December 31, 2021 554,718 221.33 Repurchases of common stock for the year ended December 31, 2020 1,161,947 88.20 (1) Average price paid per share excludes broker commissions. All repurchases were made using cash resources, and all repurchased shares of common stock have been retired. Under the stock repurchase programs, the Company may 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 may permit 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. Additionally, in June 2021, the Company repurchased approximately 1.1 million shares of its common stock for approximately $180 million concurrently with the issuance of the 2021 Notes. See “Note 12—Debt” for more information. This repurchase was separate from the stock repurchase program approved by the Board of Directors in December 2020. In August 2020, the Board of Directors approved a stock repurchase of $166.2 million, or 1.3 million shares of the Company’s common stock, concurrently with the repurchase of $301.1 million aggregate principal amount of the outstanding 2018 Notes. See “Note 12—Debt” for additional information. This repurchase was separate from the stock repurchase program approved by the Board of Directors in November 2018. |
Stock-based Compensation
Stock-based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based Compensation | Note 15—Stock-based Compensation The Company’s 2015 Equity Incentive Plan (the “2015 Plan”) was adopted by its Board of Directors and approved by stockholders in March 2015. The 2015 Plan provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, RSUs, PBRSUs, and performance cash awards to employees and directors. Beginning in 2016, the number of shares available for issuance under the 2015 Plan may be increased annually by an amount equal to the lesser of 7,050,000 shares of common stock, 5% of the outstanding shares of common stock as of the last day of the immediately preceding fiscal year, or such other amount as determined by the Company’s Board of Directors. The Board of Directors approved an increase of 6,252,714, 6,351,106, and 6,291,797, shares available for issuance under the 2015 Plan as of January 2, 2023, January 3, 2022, and January 4, 2021, respectively. Any awards issued under the 2015 Plan that are forfeited by the participant will become available for future grant under the 2015 Plan. At December 31, 2022, 50,391,850 shares were authorized under the 2015 Plan and 32,188,305 shares were available for future grant. In the year ended December 31, 2022, the Company granted nonqualified stock options and RSUs, including Financial PBRSUs and TSR PBRSUs, to eligible participants under its 2015 Plan. The Company recognizes forfeitures as they occur. Options were generally granted for a term of 10 years. For both options and RSUs, vesting is typically over a four-year period and is contingent upon continued employment with the Company on each vesting date. I n general , for newly-hired employees, both options and RSUs vest 25% after the first year of service and ratably each six-month period over a four-year period following the vesting commencement date, which is the first day of the month following the date of grant. I n general, for current employees who receive an additional grant, both options and RSUs vest ratably each six-month period over a four-year period following the vesting commencement date . For Financial PBRSUs, the number of RSUs received will depend on the achievement of financial metrics relative to the approved performance targets. Depending on the actual financial metrics achieved relative to the target financial metrics, throughout the defined performance period of the award, the number of PBRSUs that vest could range from 0% to 200% of the target amount, and are subject to the Compensation Committee’s approval of the level of achievement against the approved performance targets. For the TSR PBRSUs, the number of RSUs received will depend on the Company’s total shareholder return relative to that of the Nasdaq Composite Index over a three-year measurement period. The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model. The fair value of RSUs is determined based on the closing price of the Company’s common stock on Nasdaq on the grant date. Additionally, the fair value of the Financial PBRSUs is determined using a probability assessment and the fair value of the TSR PBRSUs with market conditions is determined using a Monte-Carlo simulation model. For PBRSUs, the Company recognizes stock-based compensation expenses on a straight-line basis over the longest of the derived, explicit, or implicit service period. As of interim and annual reporting periods, the Financial PBRSUs stock-based compensation expense is adjusted based on expected achievement of performance targets, while TSR PBRSUs stock-based compensation expense is not adjusted. The requisite service period for stock options and RSUs is generally four years from the date of grant. The fair value of options granted in the periods indicated using the Black-Scholes pricing model has been based on the following assumptions: Year Ended 2022 2021 2020 Expected Volatility 62.5% 43.4% - 57.4% 38.9% - 41.7% Risk-free interest rate 3.4% 0.8% - 1.2% 0.3% - 1.7% Expected term (in years) 4.6 4.6 - 6.2 5.5 - 6.2 The following table summarizes the activity for the Company’s options (in thousands, except share and per share amounts): Shares Weighted-Average Weighted-Average Aggregate Outstanding at December 31, 2019 6,294,919 $ 16.26 7.24 $ 185,900 Granted 654,296 46.38 Exercised (1,834,773) 13.80 Forfeited/Canceled (14,490) 32.15 Outstanding at December 31, 2020 5,099,952 20.97 6.81 800,453 Granted 198,193 218.93 Exercised (994,456) 22.83 Forfeited/Canceled (29,964) 47.86 Outstanding at December 31, 2021 4,273,725 29.52 5.99 810,321 Granted 9,916 76.05 Exercised (816,620) 18.40 Forfeited/Canceled (10,704) 126.22 Outstanding at December 31, 2022 3,456,317 31.99 5.06 322,230 Total exercisable at December 31, 2022 3,041,998 23.07 4.74 301,224 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 in periods indicated (in thousands, except per share amounts): Year Ended December 31, 2022 2021 2020 Weighted average grant date fair value of options granted $ 40.84 $ 95.00 $ 18.18 Intrinsic value of options exercised 87,892 206,709 151,785 Fair value of awards vested 195,929 96,592 60,622 The total unrecognized compensation expense at December 31, 2022 related to the Company’s options was $14.3 million, which will be recognized over an estimated weighted-average amortization period of 1.89 years. In connection with the acquisitions of Depop and Elo7 in July 2021, outstanding, unvested options held by continuing employees of each acquired entity as of the respective acquisition dates were replaced with Etsy RSU awards with the same aggregate fair value, with a total dollar value of $78.8 million, $5.6 million of which relates to pre-combination service and was included as a component of the purchase price. These RSUs generally follow the original vesting schedule of the replaced options, which provided that they will vest 25% on the first anniversary of their original vesting commencement date with the remaining 75% vesting ratably each month thereafter until the fourth anniversary of their original vesting commencement date. The following table summarizes the activity for the Company’s unvested RSUs, which includes Financial PBRSUs and TSR PBRSUs: Shares Weighted-Average Unvested at December 31, 2019 2,960,413 $ 40.61 Granted 1,712,587 54.19 Vested (1,369,271) 35.36 Forfeited/Canceled (217,742) 43.27 Unvested at December 31, 2020 3,085,987 50.28 Granted (1) 2,136,685 208.84 Vested (1,400,241) 59.80 Forfeited/Canceled (315,710) 108.22 Unvested at December 31, 2021 3,506,721 137.87 Granted 5,226,948 119.83 Vested (1,670,084) 110.53 Forfeited/Canceled (669,799) 154.06 Unvested at December 31, 2022 6,393,786 128.37 (1) Includes RSU awards issued to Depop and Elo7 employees in connection with the acquisitions in the third quarter of 2021. The total unrecognized compensation expense at December 31, 2022 related to the Company’s unvested RSUs, including the Financial PBRSUs and TSR PBRSUs, was $675.4 million, which will be recognized over an estimated weighted-average amortization period of 2.94 years. In connection with the acquisition of Depop, certain Depop executives are eligible to receive deferred consideration of $44.0 million in shares of Etsy common stock over the three years following the acquisition date, subject to certain service-based vesting conditions during the vesting period. These awards will be settled by issuing shares of Etsy common stock on or shortly following the applicable vesting date, with the number of shares to be determined based on the Company’s stock price on, or leading up to, the applicable vesting date. These awards will be recognized as post-combination service stock-based compensation expense over a vesting period equal to the mandatory service period associated with the award, with a corresponding liability included within Other liabilities on the Company’s Consolidated Balance Sheets until the service-based vesting criteria are met and the awards are settled in shares of Etsy common stock. The unrecognized compensation expense at December 31, 2022 related to these awards was $4.6 million, which will be recognized over a remaining term of 1.53 years. The decrease from the initial unrecognized compensation expense of $44.0 million primarily relates to the departure of Depop’s Chief Executive Officer, effective September 2022, and the partial payments of Depop deferred consideration in the year ended December 31, 2022. These amounts are excluded from the unrecognized compensation expense associated with the Company’s unvested RSUs noted above. Stock-based compensation expense included in the Consolidated Statements of Operations is as follows (in thousands): Year Ended 2022 2021 2020 Cost of revenue $ 23,283 $ 13,085 $ 7,731 Marketing 19,571 11,339 5,184 Product development 124,559 58,900 33,030 General and administrative 63,475 56,586 19,169 Stock-based compensation expense $ 230,888 $ 139,910 $ 65,114 |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Consolidation | Basis of ConsolidationThe consolidated financial statements include the accounts of Etsy, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. On July 12, 2021, Etsy acquired all of the issued share capital of Depop Limited (“Depop”) pursuant to a share purchase, and on July 2, 2021, Etsy acquired all the outstanding shares of Elo7 Serviços de Informática S.A. (“Elo7”) by means of a merger. The financial results of Depop and Elo7 have been included in Etsy’s consolidated financial statements from the dates of acquisition. |
Reclassification | Reclassification Certain items in the prior years consolidated financial statements have been reclassified to conform to the current year presentation reflected in the consolidated financial statements. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the Company to make estimates and judgments that affect the amounts reported and disclosed in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates and judgments. The accounting estimates that require management’s most subjective judgments include: stock-based compensation; income taxes; the valuation of acquired intangible assets, developed technology, and goodwill as part of purchase price allocations for business combinations; valuation of goodwill; leases; and fair value of convertible senior notes. As of December 31, 2022, the Company continues to monitor the effects of global macroeconomic and geopolitical uncertainty, including COVID-19 pandemic related factors and general market, political, and economic conditions, on the Company’s business, results of operations, and financial condition. As a result, many of the Company’s estimates and judgments require increased judgment and carry a higher degree of variability and volatility. As additional information becomes available, the Company’s estimates may change materially in future periods. |
Revenue Recognition | Revenue Recognition The Company’s revenue is diversified; generated from a mix of marketplace activities and other optional services the Company provides to sellers to help them generate more sales and scale their businesses. Revenues are recognized as the Company transfers control of promised goods or services to 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. The Company’s revenues are recognized on a gross basis, with the primary exception being shipping label revenue, which is recorded on a net basis. Sales and usage-based taxes are excluded from revenues. Marketplace revenue: As members of the Etsy.com 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 marketplace sellers pay a fixed listing fee of $0.20 for each item listed on Etsy.com, and 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. Listing fees are nonrefundable. Variable fees include transaction fees and payments processing fees. Etsy marketplace sellers pay a 6.5% transaction fee, which was increased from 5% effective April 11, 2022, for each completed transaction, inclusive of shipping fees charged. In May 2020, the Etsy marketplace started charging sellers for Offsite Ads, whereby sellers pay a transaction fee of 12% or 15% of the value of a sale based on the seller’s volume of sales, if such sale is generated from an advertisement placed by Etsy on third-party internet platforms. The corresponding expense is recorded in marketing. Etsy marketplace sellers pay Etsy Payments processing fees, which typically vary between 3.0% and 4.5% of an item’s total sale price, including shipping, plus a flat fee per order that depends on the country in which a seller’s bank account is located, plus an additional transaction fee for foreign currency payments. The transaction fee, Offsite Ads transaction fee, and Etsy Payments processing fees are recognized when the corresponding transaction is consummated, and are recorded net of refunds. Reverb, Depop, and Elo7 marketplace revenue is comprised of seller transaction fees and payments processing fees, which are recognized when the transaction is consummated, and are recorded net of refunds. Reverb, Elo7, and Depop sellers pay a 5%, 7%, and 10% transaction fee, respectively, for each completed transaction. The Reverb and Depop transaction fee is inclusive of shipping fees charged. Services revenue: Services revenue is derived from optional services offered to Etsy marketplace sellers, which primarily include on-site advertising and shipping labels. Each service represents an individual obligation that the Company must perform when a seller chooses to use the service. On-site advertising services consist of cost-per-click fees an Etsy marketplace seller pays for prominent placement of her listings. These fees are nonrefundable and are charged to a seller’s Etsy bill when the listing is clicked, at which time revenue is recognized. Revenue from shipping labels consists of fees an Etsy marketplace 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 shipping label revenue when an Etsy marketplace seller purchases a shipping label. The Company recognizes 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 marketplace seller. Etsy shipping label revenue is recorded net of refunds. The Reverb, Depop, and Elo7 marketplaces offer on-site advertising services (Depop as of the end of the third quarter of 2022), and shipping labels services. Each service represents an individual obligation that the Company must perform when a seller chooses to use the service. Shipping label revenue is recorded net of refunds. Contract balances: The Company records deferred revenues when cash payments are received or due in advance of the completion of the four-month listing period on Etsy.com, which represents the value of the Company’s unsatisfied performance obligations, unless the item is sold or the seller re-lists it, at which time any remaining listing fee is recognized. The amount of revenue recognized in the year ended December 31, 2022 that was included in the deferred balance at January 1, 2022 was $12.3 million. Cost of Revenue |
Marketing | MarketingMarketing expenses primarily consist of direct marketing expenses, which largely includes digital marketing and television ad and digital video expenses. Marketing expenses also include employee compensation-related expenses to support the Company’s marketing initiatives and amortization expense related to acquired customer relationship and trademark intangible assets. |
Advertising | Advertising expenses are recognized as incurred, with the exception of certain production expenses related to television and display advertising which are deferred until the first time an advertisement airs or is published. If such advertising is not expected to occur, costs are expensed immediately. |
Product Development | Product Development Product development expenses consist primarily of employee compensation-related expenses for engineering, product management, product design, and product research activities, net of costs capitalized to website development and internal-use software. Additional expenses include consulting costs related to the development, quality assurance, and testing of new technology and enhancement of the Company’s existing technology. |
Stock-Based Compensation | Stock-Based Compensation Service-based stock options and restricted stock units (“RSUs”) are awarded to employees and members of the Company’s Board of Directors and performance-based restricted stock units (“PBRSUs”) are awarded to employees. All such awards are measured at fair value at each grant date. The PBRSUs include financial performance-based restricted stock units (“Financial PBRSUs”) and total shareholder return performance-based restricted stock units (“TSR PBRSUs”), both of which have performance and service vesting requirements. The Company recognizes forfeitures as they occur. The Company calculates the fair value of stock options on the date of grant using the Black-Scholes option-pricing model and the expense is recognized over the requisite service period. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The Company calculates expected volatility based on the historical volatility of Etsy’s stock price observations over a period equivalent to the expected term of the stock option grants. The Company estimates its expected term using historical option exercise behavior and expected post-vest cancellation data, averaged with an assumption that recently granted options will be exercised ratably from vesting to the expiration of the stock option. The fair value of RSUs and Financial PBRSUs is determined based on the closing price of the Company’s common stock on Nasdaq on the grant date. Additionally, the fair value of the Financial PBRSUs takes into consideration a vesting probability assessment as of each reporting date. The fair value of the TSR PBRSUs is determined using a Monte-Carlo simulation model on the grant date. |
Foreign Currency | Foreign Currency The Company has determined that the functional currency for each of its foreign operations is the currency of the primary cash flow of the operations, which is generally the local currency in which the operation is located. All assets and liabilities are translated into U.S. dollars using exchange rates in effect at the balance sheet date. Revenue and expenses are translated using average exchange rates during the period. Foreign currency translation adjustments are reflected in stockholders’ equity as a component of other comprehensive income (loss). Transaction gains and losses including intercompany balances denominated in a currency other than the functional currency of the entity involved are included in foreign exchange gain (loss) within other income (expense) in the Consolidated Statements of Operations. |
Income Taxes | Income Taxes The income tax benefit is based on income before income taxes and is accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to settle. The Company recognizes future tax benefits, such as net operating losses and tax credits, to the extent that realizing these benefits is considered in its judgment to be more likely than not. The effect on deferred tax assets and liabilities of a change in tax rates is recognized as income or expense in the period that includes the enactment date. The Company regularly reviews the recoverability of its deferred tax assets by considering its historic profitability, projected future taxable income, timing of the reversals of existing temporary differences and the feasibility of its tax planning strategies. Where appropriate, the Company records a valuation allowance against deferred tax assets that are deemed not more likely than not to be realizable. The Company records tax expense related to Global Intangible Low Taxed Income (“GILTI”) as a current period expense when incurred using the period cost method. The Company accounts for uncertainty in income taxes using a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by the taxing authorities. The amount recognized is measured as the largest amount of benefit that has a greater than 50% likelihood of being realized upon ultimate audit settlement. The Company recognizes interest and penalties, if any, associated with income tax matters as part of the income tax provision and includes accrued interest and penalties with the related income tax liability in the Consolidated Balance Sheets. |
Net (Loss) Income Per Share | Net (Loss) Income Per Share Basic net (loss) income per share attributable to common stockholders is computed by dividing the net (loss) income attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted net (loss) income per share is computed by dividing net (loss) income adjusted on an if-converted basis for the period by the weighted-average number of shares of common stock and potentially dilutive common stock outstanding during the period. Potentially dilutive shares, which are based on the weighted-average shares of common stock underlying outstanding stock-based compensation awards and convertible senior notes using the treasury stock method or the if-converted method, as applicable, are included when calculating net (loss) income per share of common stock attributable to common stockholders when their effect is dilutive. The calculation of diluted net income per share excludes all anti-dilutive shares of common stock. |
Segment Data | Segment Data The Company identifies operating segments as components of an entity for which discrete financial information is available and is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in making decisions regarding resource allocation and performance assessment. The Company’s CODM is its Chief Executive Officer. The Company has determined it has four operating segments, Etsy, Reverb, Depop, and Elo7, which qualify for aggregation as one reportable segment. |
Cash and Cash Equivalents | Cash and Cash Equivalents, and Short- and Long-term InvestmentsThe 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.Restricted CashThe Company classifies any cash balances that are legally restricted as to withdrawal or usage as restricted cash on the Consolidated Balance Sheets. |
Short- and Long-term Investments | Short-term investments, consisting of certificates of deposit, commercial paper, corporate bonds, U.S. agency securities, and U.S. Government securities with original maturities of greater than three months but less than one year, are classified as available-for-sale and are reported at fair value using the specific identification method. Long-term investments, consisting of corporate bonds and U.S. Government securities with original maturities of greater than twelve months but less than 37 months, 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 tax (expense) benefit. |
Restricted Cash | Restricted CashThe Company classifies any cash balances that are legally restricted as to withdrawal or usage as restricted cash on the Consolidated Balance Sheets. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash and cash equivalents, short- and long-term investments, and funds receivable and seller accounts. The Company reduces credit risk by placing its cash and cash equivalents with major financial institutions with high credit ratings. At times, to the extent eligible, such amounts may exceed federally insured limits. The Company believes that minimal credit risk exists with respect to these investments due to the credit ratings of the financial institutions that hold its short- and long-term investments. In addition, funds receivable settle relatively quickly, and the Company’s historical experience of losses has not been significant. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Management believes that the fair value of financial instruments, consisting of cash and cash equivalents, short- and long-term investments, accounts receivable, funds receivable and seller accounts, accounts payable, and funds payable and amounts due to sellers approximates carrying value due to the immediate or short-term maturity associated with these instruments or the Company’s ability to liquidate these instruments at short notice with minimal penalties. |
Accounts Receivable and Provision for Expected Credit Losses | Accounts Receivable and Provision for Expected Credit Losses The Company’s trade accounts receivable are recorded at amounts billed to sellers and are presented on the Consolidated Balance Sheets net of the provision for expected credit losses. The provision is determined by a number of factors, including age of the receivable, current economic conditions, historical losses, and management’s assessment of the financial condition of sellers. Receivables are written off once they are deemed uncollectible. Estimates of uncollectible accounts receivable are recorded to general and administrative expense. |
Funds Receivable and Seller Accounts and Funds Payable and Amounts due to Sellers | Funds Receivable and Seller Accounts and Funds Payable and Amounts due to SellersThe Company records funds receivable and seller accounts and funds payable and amounts due to sellers as current assets and liabilities, respectively, on the Consolidated Balance Sheets. Funds receivable and seller accounts represent amounts received or expected to be received from buyers via third-party credit card processors, which flow through a bank account for payment to sellers. The amounts recorded to funds receivable and seller accounts is the same amount recorded to the funds payable and amounts due to sellers, the latter of which represents the total amount due to sellers, given the intent to use these funds to settle funds payable to sellers. For the Depop marketplace only, the amounts received from buyers which is owed to the sellers is paid to the sellers at point of sale, and therefore no funds receivable and seller accounts and no funds payable and amounts due to sellers are recorded related to the Depop marketplace. |
Property and Equipment | Property and Equipment Property and equipment, consisting principally of capitalized website development and internal-use software, building, leasehold improvements, and computer equipment, are recorded at cost. Depreciation and amortization begin at the time the asset is placed into service and is recognized using the straight-line method in amounts sufficient to relate the cost of depreciable and amortizable assets to the Consolidated Statements of Operations over their estimated useful lives. Repairs and maintenance are charged to the Consolidated Statements of Operations as incurred. Upon sale or retirement of assets, the cost and related accumulated depreciation or amortization are removed from the Consolidated Balance Sheet and the resulting gain or loss is reflected in the Consolidated Statement of Operations. |
Website Development and Internal-use Software Costs | Website Development and Internal-use Software Costs Costs incurred to develop the Company’s website and software for internal-use are capitalized and amortized over the estimated useful life of the software, generally three Capitalized website development and internal-use software costs are included in property and equipment, net within the Consolidated Balance Sheets. |
Business Combinations | Business Combinations The Company accounts for business combinations using the acquisition method of accounting. If the assets acquired are not a business, the Company accounts for the transaction as an asset acquisition. Under both methods, the purchase price is allocated to the assets acquired and liabilities assumed using the fair values determined by management as of the acquisition date. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of acquisition. Acquisition-related expenses represent expenses incurred by the Company to effect a business combination, including expenses such as finder’s fees and advisory, legal, accounting, valuation, and other professional or consulting fees, and are not included as a component of consideration transferred, but are accounted for as an expense in the period in which the costs are incurred or the services are rendered. |
Goodwill | Goodwill Goodwill represents the excess of the aggregate fair value of the consideration transferred in a business combination over the fair value of the assets acquired, net of liabilities assumed. The Company performs its annual goodwill impairment test during the fourth quarter or more frequently if events or changes in circumstances indicate that the goodwill may be impaired. Management has determined that the Company has four operating segments, Etsy, Reverb, Depop, and Elo7, and each operating segment is determined to be a reporting unit. The Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of the reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, the Company determines it is not more likely than not that the fair value of the reporting unit is less than its carrying amount, then additional impairment testing is not required. However, if the Company concludes otherwise, then it is required to perform a quantitative assessment for impairment. The quantitative assessment involves comparing the estimated fair value of the reporting unit with its respective book value, including goodwill. If the estimated fair value exceeds book value, goodwill is not considered to be impaired. If, however, the book value of the reporting unit exceeds the fair value, an impairment loss is recognized in an amount equal to the excess, not to exceed the total amount of goodwill allocated to that reporting unit. See “Note 6—Goodwill and Intangible Assets” for further information. |
Intangible Assets | Intangible AssetsFinite intangible assets are amortized using the straight-line method over the estimated useful life of the asset. |
Leases | Leases The Company’s lease arrangements generally include real estate and computer equipment assets. 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. At lease commencement, the Company evaluates whether the arrangement is a finance or operating lease, and accounts for it accordingly. 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. Leases with a term greater than one year are recognized on the Consolidated Balance Sheets as right-of-use (“ROU”) assets, lease obligations, and, if applicable, long-term lease obligations in the financial statement 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 in 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. |
Impairment of Long-Lived Assets | Impairment of Long-Lived AssetsThe Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated from the use of the asset and its eventual disposition. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount exceeds the fair value of the impaired assets. Assets to be disposed of are reported at the lower of their carrying amount or fair value less cost to sell. |
Contingencies | Contingencies The Company accrues for loss contingencies when losses become probable and are reasonably estimable. If the reasonable estimate of the loss is a range and no amount within the range is a better estimate, the minimum amount of the range is recorded as a liability. The Company does not accrue for contingent losses that, in its judgment, are considered to be reasonably possible, but not probable; however, it discloses the range of such reasonably possible losses. |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Accounts Receivable, Allowance for Credit Loss | The following table provides a rollforward of the allowance for credit losses that is deducted from the amortized cost basis of accounts receivable to present the net amount expected to be collected (in thousands): Year Ended 2022 2021 2020 Balance as of the beginning of period $ 7,730 $ 9,757 $ 5,033 Provision for expected credit losses 12,464 16,031 15,033 Amounts written off, net of recoveries (11,891) (18,058) (10,309) Balance as of the end of period $ 8,303 $ 7,730 $ 9,757 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table summarizes revenue disaggregated by Marketplace revenue and optional Services revenue for the periods presented (in thousands): Year Ended December 31, 2022 2021 2020 Marketplace revenue $ 1,910,887 $ 1,745,824 $ 1,303,126 Services revenue 655,224 583,290 422,499 Revenue $ 2,566,111 $ 2,329,114 $ 1,725,625 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The following are the domestic and foreign components of the Company’s (loss) income before income taxes (in thousands): Year Ended 2022 2021 2020 United States $ 225,685 $ 274,354 $ 206,481 International (887,663) 197,300 159,228 (Loss) income before income taxes $ (661,978) $ 471,654 $ 365,709 |
Income Tax Benefit | The income tax provision (benefit) is comprised of the following (in thousands): Year Ended 2022 2021 2020 Current: U.S. Federal $ 46,700 $ 23,118 $ 4,854 U.S. State 16,036 12,754 3,953 International 24,877 31,227 5,455 Total current 87,613 67,099 14,262 Deferred: U.S. Federal (18,753) (53,328) (7,684) U.S. State (7,866) (14,843) (4,543) International (28,684) (20,781) 14,428 Total deferred (55,303) (88,952) 2,201 Total income tax provision (benefit) $ 32,310 $ (21,853) $ 16,463 |
Reconciliation of the Income Tax Benefit | A reconciliation of the income tax provision (benefit) at the U.S. federal statutory income tax rate to the Company’s total income tax provision (benefit) is as follows (in thousands): Year Ended 2022 2021 2020 Income tax (benefit) provision at the federal statutory rate $ (139,015) $ 99,047 $ 76,799 State and local income taxes, net of federal benefit 10,516 11,134 7,693 Foreign income tax rate differential (89,903) (26,215) (13,193) Stock-based compensation (12,863) (83,207) (45,391) Research and development credit (19,603) (23,396) (15,156) U.S. tax on foreign earnings, net of foreign income deduction (1) 3,588 (5,155) 3,923 Non-deductible acquisition costs 1,204 5,643 — Non-deductible goodwill impairment 274,492 — — Other (2) 3,894 296 1,788 Total income tax provision (benefit) $ 32,310 $ (21,853) $ 16,463 (1) Previously disclosed as “U.S. tax reform” for the years ended December 31, 2021 and 2020. (2) Certain prior year amounts, which are not material, have been reclassified to conform to current year presentation. |
Significant Components of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets (liabilities) are as follows (in thousands): As of December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 66,410 $ 48,689 Research and development credit carryforwards — 367 Capitalized research expenses 63,901 5,036 Convertible debt 40,159 47,142 Depreciation 7,051 42,019 Lease liability 33,253 35,871 Stock-based compensation expense 25,151 19,319 Accrued bonus 9,478 11,850 Excess tax basis in intangible assets 1,924 1,585 Other deferred tax assets 13,443 14,651 Total deferred tax assets 260,770 226,529 Less: valuation allowance 3,524 1,834 Total net deferred tax asset 257,246 224,695 Deferred tax liabilities: Excess book basis in intangible assets (147,790) (173,097) Right-of-use asset (31,864) (34,612) Other deferred tax liabilities (821) (607) Total deferred tax liabilities (180,475) (208,316) Net deferred tax assets $ 76,771 $ 16,379 |
Summary of Tax Credit Carryforwards | As of December 31, 2022, the Company had the following tax credit and operating loss carryforwards available to offset income tax liability and taxable income, respectively, in future years (in thousands): December 31, 2022 Expiration Period U.S. Federal credit carryforwards $ 1,289 2031-2032 U.S. State net operating loss carryforwards 5,789 2031-Unlimited Non-U.S. net operating loss carryforwards 257,006 Unlimited |
Summary of Operating Loss Carryforwards | As of December 31, 2022, the Company had the following tax credit and operating loss carryforwards available to offset income tax liability and taxable income, respectively, in future years (in thousands): December 31, 2022 Expiration Period U.S. Federal credit carryforwards $ 1,289 2031-2032 U.S. State net operating loss carryforwards 5,789 2031-Unlimited Non-U.S. net operating loss carryforwards 257,006 Unlimited |
Summary of Valuation Allowance | The following table summarizes the valuation allowance activity for the periods indicated (in thousands): Year Ended 2022 2021 2020 Balance as of the beginning of period $ 1,834 $ 1,398 $ 883 Additions charged to expense 1,796 580 506 Deletions credited to expense — (112) (101) Currency translation and other balance sheet activity (106) (32) 110 Balance as of the end of period $ 3,524 $ 1,834 $ 1,398 |
Schedule of Unrecognized Tax Benefits Activity | The following table summarizes the unrecognized tax benefit activity for the periods indicated (in thousands): As of December 31, 2022 2021 2020 Balance as of the beginning of period $ 28,842 $ 23,738 $ 19,933 Additions based on tax positions related to the current year 5,206 5,024 2,507 Additions for tax positions of prior years 1,754 122 1,576 Reductions for tax provisions of prior years (509) — (278) Settlements (107) — — Currency translation (28) (42) — Balance as of the end of period $ 35,158 $ 28,842 $ 23,738 |
Net (Loss) Income Per Share (Ta
Net (Loss) Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the calculation of basic and diluted net (loss) income per share for periods presented (in thousands, except share and per share amounts): Year Ended 2022 2021 2020 Numerator: Net (loss) income $ (694,288) $ 493,507 $ 349,246 Add back interest expense, net of tax attributable to assumed conversion of convertible senior notes — 4,900 17,880 Net (loss) income attributable to common stockholders—diluted $ (694,288) $ 498,407 $ 367,126 Denominator: Weighted average common shares outstanding—basic 126,778,626 127,224,974 121,251,588 Dilutive effect of assumed conversion of options to purchase common stock — 4,149,248 4,492,550 Dilutive effect of assumed conversion of restricted stock units — 1,995,336 2,046,981 Dilutive effect of assumed conversion of convertible senior notes — 13,313,766 8,623,473 Weighted average common shares outstanding—diluted 126,778,626 146,683,324 136,414,592 Net (loss) income per share attributable to common stockholders—basic $ (5.48) $ 3.88 $ 2.88 Net (loss) income per share attributable to common stockholders—diluted $ (5.48) $ 3.40 $ 2.69 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following potential shares of common stock were excluded from the calculation of diluted net (loss) income per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Year Ended 2022 2021 2020 Stock options 3,127,333 149,683 3,711 Restricted stock units 5,081,194 584,033 71 Convertible senior notes 14,715,935 — 8,625,771 Total anti-dilutive securities 22,924,462 733,716 8,629,553 |
Schedule of Method Used to Calculate Impact from Convertible Senior Notes on Earnings Per Share | The following table presents the method used when calculating the impact of the Company’s Notes on earnings per share for the periods presented: Year Ended 2022 2021 2020 2021 Notes If-Converted If-Converted N/A 2020 Notes If-Converted If-Converted Treasury Stock 2019 Notes If-Converted If-Converted If-Converted 2018 Notes If-Converted If-Converted If-Converted |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Purchase Price Allocation | The following table summarizes the allocation of the purchase price (at fair value), including measurement period adjustments, to the assets acquired and liabilities assumed of Depop as of July 12, 2021 (the date of acquisition) (in thousands): Final Purchase Price Allocation as Adjusted Estimated Useful Life (in years) Current assets $ 4,288 Property and equipment other 1,299 2-5 Developed technology 95,764 5 Trademark 249,820 20 Customer relationships 148,504 13 Goodwill 1,118,855 Indefinite Current liabilities (18,878) Non-current liabilities (1) (27,957) Deferred tax liability, net (78,872) Total purchase price 1,492,823 (1) Non-current liabilities are primarily related to non-income tax related contingency reserves. The following table summarizes the allocation of the purchase price (at fair value), including measurement period adjustments, to the assets acquired and liabilities assumed of Elo7 as of July 2, 2021 (the date of acquisition) (in thousands): Final Purchase Price Allocation as Adjusted Estimated Useful Life (in years) Current assets $ 2,721 Developed technology 12,084 5 Trademark 22,187 15 Customer relationships 44,374 15 Goodwill 157,187 Indefinite Non-current assets 2,412 Current liabilities (3,406) Non-current liabilities (2,691) Deferred tax liability, net (22,727) Total purchase price $ 212,141 |
Schedule of Unaudited Supplemental Pro Forma Information | The following unaudited pro forma summary presents consolidated information of the Company, including Depop and Elo7, as if the business combinations had occurred on January 1, 2020 (in thousands): Year Ended December 31, 2021 2020 Revenue $ 2,373,592 $ 1,801,690 Net income 492,732 319,669 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table summarizes the changes in the carrying amount of goodwill for the periods indicated (in thousands): Year Ended 2022 2021 Balance as of the beginning of the period $ 1,371,064 $ 140,810 Business combinations — 1,276,042 Impairment (1,045,022) — Foreign currency translation adjustments (188,318) (45,788) Balance as of the end of the period $ 137,724 $ 1,371,064 |
Schedule of Finite-Lived Intangible Assets | At December 31, 2022 and 2021, the gross book value and accumulated amortization of intangible assets were as follows (in thousands): As of December 31, 2022 Gross book Accumulated Net book Weighted-Average Trademark $ 318,489 $ (35,873) $ 282,616 16.7 Customer relationships 265,429 (39,808) 225,621 11.9 Referral agreement 34,050 (15,404) 18,646 5.5 Patent licenses 9,617 (1,094) 8,523 9.9 Intangible assets $ 627,585 $ (92,179) $ 535,406 14.2 As of December 31, 2021 Gross book Accumulated Net book Weighted-Average Trademark $ 342,753 $ (18,817) $ 323,936 17.8 Customer relationships 278,311 (21,243) 257,068 12.9 Referral agreement 36,109 (12,677) 23,432 6.5 Patent licenses 3,149 (415) 2,734 5.6 Intangible assets $ 660,322 $ (53,152) $ 607,170 15.2 |
Schedule of Future Amortization Expense | Based on amounts recorded at December 31, 2022, the Company estimates future amortization expense of intangible assets as follows (in thousands): 2023 $ 41,134 2024 41,123 2025 41,123 2026 40,802 2027 40,734 Thereafter 330,490 Total amortization expense $ 535,406 |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Revenue from External Customers by Geographic Areas | The following table summarizes revenue by geographic area (in thousands): Year Ended 2022 2021 2020 United States $ 1,429,650 $ 1,393,637 $ 1,150,725 United Kingdom 343,788 329,203 195,827 All Other 792,673 606,274 379,073 Revenue $ 2,566,111 $ 2,329,114 $ 1,725,625 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Major Categories of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table sets forth the cost, gross unrealized losses, gross unrealized gains, and fair values of the Company’s investments as of the dates indicated (in thousands): Cost Gross Gross Fair Value Cash and Cash Equivalents Short-term Investments Long-term Investments December 31, 2022 Level 1 Money market funds (1) $ 462,866 $ — $ — $ 462,866 $ 374,314 $ 76 $ — U.S. Government securities 64,968 (424) 4 64,548 2,995 61,553 — 527,834 (424) 4 527,414 377,309 61,629 — Level 2 U.S. agency securities 10,053 (1) 3 10,055 — 10,055 — Certificate of deposit 40,915 (184) 7 40,738 5,471 35,267 — Commercial paper 57,777 (101) 18 57,694 4,454 53,240 — Corporate bonds 122,294 (1,729) 6 120,571 1,212 90,222 29,137 231,039 (2,015) 34 229,058 11,137 188,784 29,137 $ 758,873 $ (2,439) $ 38 $ 756,472 $ 388,446 $ 250,413 $ 29,137 December 31, 2021 Level 1 Money market funds 556,427 — — 556,427 556,427 — — U.S. Government securities 60,311 (55) 11 60,267 — 52,632 7,635 616,738 (55) 11 616,694 556,427 52,632 7,635 Level 2 Certificate of deposit 20,709 (7) 1 20,703 — 20,703 — Commercial paper 25,235 (14) 1 25,222 8,998 16,224 — Corporate bonds 192,727 (481) 10 192,256 — 114,857 77,399 238,671 (502) 12 238,181 8,998 151,784 77,399 $ 855,409 $ (557) $ 23 $ 854,875 $ 565,425 $ 204,416 $ 85,034 (1) $88.5 million of money market funds were classified as funds receivable and seller accounts as of December 31, 2022. There were no money market funds classified as funds receivable and seller accounts as of December 31, 2021. |
Schedule of Estimated Fair Value Liability Component | The following table presents the carrying value and estimated fair value of the Notes as of the dates indicated (in thousands): As of December 31, 2022 As of December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value 2021 Notes $ 989,629 $ 863,300 $ 987,729 $ 1,165,519 2020 Notes 644,431 646,230 643,237 $ 862,774 2019 Notes 645,536 998,361 644,390 1,644,869 2018 Notes (1) 44 145 62 375 $ 2,279,640 $ 2,508,036 $ 2,275,418 $ 3,673,537 (1) Contemporaneously with the partial repurchase of the 2018 Notes in the third quarter of 2020, the Company agreed with the counterparties to the associated capped call instrument (the “2018 Capped Call Transactions”) that the 2018 Capped Call Transactions would remain outstanding with a maturity of March 2023 and there was no exchange of any consideration for such agreement. See “Note 12—Debt” for more information on the Company’s capped call transactions. |
Debt Securities, Available-for-Sale, Unrealized Loss Position, Fair Value | The table below shows the gross unrealized loss and fair value of the following investments in available-for-sale debt securities that are classified by the length of time that the securities have been in a continuous unrealized loss position at December 31, 2022 (in thousands): Gross Fair Value Less than 12 months in a continuous unrealized loss position Corporate bonds $ (281) $ 70,469 U.S. Government securities (265) 51,075 $ (546) $ 121,544 12 months or longer in a continuous unrealized loss position Corporate bonds $ (1,448) $ 50,102 U.S. Government securities (159) 7,442 $ (1,607) $ 57,544 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following as of the dates indicated (in thousands): As of December 31, Estimated useful lives 2022 2021 Computer equipment 3 years $ 12,820 $ 8,037 Furniture and equipment 2 - 4 years 11,398 7,170 Leasehold improvements Shorter of life of asset or lease term 56,095 48,145 Construction in progress Not applicable 419 10,835 Building Lease term 133,063 133,063 Website development and internal-use software 3 - 5 years 240,138 224,855 453,933 432,105 Less: Accumulated depreciation and amortization 204,189 157,043 $ 249,744 $ 275,062 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Lease Expense, Weighted Averages and Supplemental Cash Flow Information | For the years ended December 31, 2022, 2021, and 2020, the elements of lease expense were as follows (in thousands): Year Ended 2022 2021 2020 Operating lease cost $ 8,251 $ 6,320 $ 5,847 Finance lease cost: Amortization of right-of-use assets 7,174 9,139 10,190 Interest on lease liabilities 5,392 3,044 2,576 Total finance lease cost 12,566 12,183 12,766 Other lease cost, net (1) 1,220 1,193 1,322 Total lease cost $ 22,037 $ 19,696 $ 19,935 (1) Other lease cost, net includes short-term lease costs and variable lease costs. The following table presents the lease-related assets and liabilities recorded on the Consolidated Balance Sheets (in thousands): As of December 31, 2022 2021 Operating leases: Other assets $ 38,784 $ 45,951 Other current liabilities $ 4,233 $ 4,018 Other liabilities 38,085 43,746 Total operating lease liabilities $ 42,318 $ 47,764 Finance leases: Property and equipment, net $ 102,169 $ 109,131 Finance lease obligations—current $ 4,731 $ 2,418 Finance lease obligations—net of current portion 105,699 110,283 Total finance lease liabilities $ 110,430 $ 112,701 The following table summarizes the weighted average remaining lease term and weighted average discount rate as of December 31, 2022 and 2021: As of December 31, 2022 2021 Weighted average remaining lease term: Operating leases 14.54 years 14.67 years Finance leases 16.49 years 17.41 years Weighted average discount rate: Operating leases 4.54 % 4.46 % Finance leases 4.73 % 4.72 % |
Schedule of Cash Flow Activities, Lessee | Supplemental cash flow information related to leases was as follows (in thousands): Year Ended 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows used in operating leases $ (7,871) $ (6,442) $ (5,519) Operating cash flows used in finance leases (5,387) (3,025) (2,551) Finance cash flows used in finance leases (6,307) (8,864) (9,211) |
Schedule of Future Minimum Operating Lease Payments | Future minimum lease payments under non-cancelable leases as of December 31, 2022 were as follows (in thousands): Operating Leases Finance Leases 2023 $ 5,783 $ 9,036 2024 6,190 10,999 2025 5,428 10,760 2026 778 100 2027 272 882 Thereafter 41,565 134,997 Total future minimum lease payments (1) 60,016 166,774 Less: Imputed interest 17,698 56,344 Total $ 42,318 $ 110,430 (1) In the fourth quarter of 2021, the Company entered into a First Amendment to Lease (the “First Amendment”) related to the Company’s corporate headquarters in Brooklyn, New York, a portion of which is accounted for as a finance lease and a portion as an operating lease. The First Amendment extended the expiration of the term of the lease from July 31, 2026 to July 31, 2039. The First Amendment includes a tenant allowance, a portion of which became available beginning in April 2022, rent concessions that become available beginning in 2026, and escalating commitments each contract year between 2028 and 2038, which are reflected in the future minimum lease payments. |
Schedule of Future Minimum Finance Lease Payments | Future minimum lease payments under non-cancelable leases as of December 31, 2022 were as follows (in thousands): Operating Leases Finance Leases 2023 $ 5,783 $ 9,036 2024 6,190 10,999 2025 5,428 10,760 2026 778 100 2027 272 882 Thereafter 41,565 134,997 Total future minimum lease payments (1) 60,016 166,774 Less: Imputed interest 17,698 56,344 Total $ 42,318 $ 110,430 (1) In the fourth quarter of 2021, the Company entered into a First Amendment to Lease (the “First Amendment”) related to the Company’s corporate headquarters in Brooklyn, New York, a portion of which is accounted for as a finance lease and a portion as an operating lease. The First Amendment extended the expiration of the term of the lease from July 31, 2026 to July 31, 2039. The First Amendment includes a tenant allowance, a portion of which became available beginning in April 2022, rent concessions that become available beginning in 2026, and escalating commitments each contract year between 2028 and 2038, which are reflected in the future minimum lease payments. |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued expenses consisted of the following as of the dates indicated (in thousands): As of December 31, 2022 2021 Pass-through marketplace tax collection obligation $ 129,591 $ 136,360 Vendor accruals 127,791 115,593 Employee compensation-related liabilities 63,718 66,477 Taxes payable 10,134 9,688 Total accrued expenses $ 331,234 $ 328,118 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The following table presents the outstanding principal amount and carrying value of the Notes as of the dates indicated (in thousands): As of December 31, 2022 2021 Notes 2020 Notes 2019 Notes 2018 Notes Total Principal $ 1,000,000 $ 650,000 $ 649,932 $ 44 $ 2,299,976 Unamortized debt issuance costs 10,371 5,569 4,396 — 20,336 Net carrying value $ 989,629 $ 644,431 $ 645,536 $ 44 $ 2,279,640 As of December 31, 2021 2021 Notes 2020 Notes 2019 Notes 2018 Notes Total Principal $ 1,000,000 $ 650,000 $ 649,958 $ 62 $ 2,300,020 Unamortized debt issuance costs 12,271 6,763 5,568 — 24,602 Net carrying value $ 987,729 $ 643,237 $ 644,390 $ 62 $ 2,275,418 |
Schedule of Maturities of Convertible Notes | The Notes will mature at their maturity date unless earlier converted, redeemed or repurchased. The terms of the Notes are summarized below: Convertible Notes Maturity Date Contractual Convertibility Date (1) Initial Conversion Rate per $1,000 Principal (2) Initial Conversion Price Annual Effective Interest Rate 2021 Notes June 15, 2028 February 15, 2028 4.0518 $ 246.80 0.4 % 2020 Notes September 1, 2027 May 1, 2027 5.0007 199.97 0.3 % 2019 Notes October 1, 2026 June 1, 2026 11.4040 87.69 0.3 % 2018 Notes March 1, 2023 November 1, 2022 27.5691 36.27 — % (1) During any calendar quarter preceding the respective contractual convertibility date of each series of Notes, 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 quarter ended December 31, 2022, holders of the remaining 2019 Notes and 2018 Notes are eligible to convert their 2019 Notes and 2018 Notes, and holders of the 2021 Notes and 2020 Notes are not eligible to convert their 2021 Notes and 2020 Notes respectively, during the first quarter of 2023. |
Schedule of Interest Expense | Interest expense related to each of the Notes for the periods presented below was as follows (in thousands): Year Ended Convertible Notes 2022 2021 2020 2021 Notes $ 4,400 $ 2,411 $ — 2020 Notes $ 2,006 $ 2,006 $ 6,741 2019 Notes $ 1,985 $ 1,985 $ 21,441 2018 Notes $ — $ 44 $ 10,987 Total interest expense (1) $ 8,391 $ 6,446 $ 39,169 |
Schedule of Capped Call Transactions | The initial terms of the Company’s Capped Call Transactions are presented below: Capped Call Transactions Maturity Date Initial Cap Price per Share Cap Price Premium 2021 Capped Call Transactions June 15, 2028 $ 340.42 100 % 2020 Capped Call Transactions September 1, 2027 327.83 150 % 2019 Capped Call Transactions October 1, 2026 148.63 150 % 2018 Capped Call Transactions March 1, 2023 52.76 100 % |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Purchase Obligations | The Company’s future payments under purchase obligations as of December 31, 2022 were as follows (in thousands): Purchase Obligations Periods ending 2023 $ 61,319 2024 115,148 2025 132,310 2026 71,295 2027 1,295 Thereafter 6,969 Total purchase obligations $ 388,336 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Summary of Activity of Shares Repurchases | The following table summarizes the Company’s stock repurchase activity related to the programs noted above: Shares Repurchased Average Price Paid per Share (1) Repurchases of common stock for the year ended December 31, 2022 3,958,155 107.56 Repurchases of common stock for the year ended December 31, 2021 554,718 221.33 Repurchases of common stock for the year ended December 31, 2020 1,161,947 88.20 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The fair value of options granted in the periods indicated using the Black-Scholes pricing model has been based on the following assumptions: Year Ended 2022 2021 2020 Expected Volatility 62.5% 43.4% - 57.4% 38.9% - 41.7% Risk-free interest rate 3.4% 0.8% - 1.2% 0.3% - 1.7% Expected term (in years) 4.6 4.6 - 6.2 5.5 - 6.2 |
Schedule of Share-based Compensation, Stock Options, Activity | The following table summarizes the activity for the Company’s options (in thousands, except share and per share amounts): Shares Weighted-Average Weighted-Average Aggregate Outstanding at December 31, 2019 6,294,919 $ 16.26 7.24 $ 185,900 Granted 654,296 46.38 Exercised (1,834,773) 13.80 Forfeited/Canceled (14,490) 32.15 Outstanding at December 31, 2020 5,099,952 20.97 6.81 800,453 Granted 198,193 218.93 Exercised (994,456) 22.83 Forfeited/Canceled (29,964) 47.86 Outstanding at December 31, 2021 4,273,725 29.52 5.99 810,321 Granted 9,916 76.05 Exercised (816,620) 18.40 Forfeited/Canceled (10,704) 126.22 Outstanding at December 31, 2022 3,456,317 31.99 5.06 322,230 Total exercisable at December 31, 2022 3,041,998 23.07 4.74 301,224 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | 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 in periods indicated (in thousands, except per share amounts): Year Ended December 31, 2022 2021 2020 Weighted average grant date fair value of options granted $ 40.84 $ 95.00 $ 18.18 Intrinsic value of options exercised 87,892 206,709 151,785 Fair value of awards vested 195,929 96,592 60,622 |
Summary of the Activity of Unvested RSUs | The following table summarizes the activity for the Company’s unvested RSUs, which includes Financial PBRSUs and TSR PBRSUs: Shares Weighted-Average Unvested at December 31, 2019 2,960,413 $ 40.61 Granted 1,712,587 54.19 Vested (1,369,271) 35.36 Forfeited/Canceled (217,742) 43.27 Unvested at December 31, 2020 3,085,987 50.28 Granted (1) 2,136,685 208.84 Vested (1,400,241) 59.80 Forfeited/Canceled (315,710) 108.22 Unvested at December 31, 2021 3,506,721 137.87 Granted 5,226,948 119.83 Vested (1,670,084) 110.53 Forfeited/Canceled (669,799) 154.06 Unvested at December 31, 2022 6,393,786 128.37 (1) Includes RSU awards issued to Depop and Elo7 employees in connection with the acquisitions in the third quarter of 2021. |
Schedule of Share-based Compensation, Allocation of Recognized Period Costs | Stock-based compensation expense included in the Consolidated Statements of Operations is as follows (in thousands): Year Ended 2022 2021 2020 Cost of revenue $ 23,283 $ 13,085 $ 7,731 Marketing 19,571 11,339 5,184 Product development 124,559 58,900 33,030 General and administrative 63,475 56,586 19,169 Stock-based compensation expense $ 230,888 $ 139,910 $ 65,114 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies - Revenue Recognition (Details) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Apr. 10, 2022 | Dec. 31, 2022 | Dec. 31, 2022 USD ($) $ / item | |
Disaggregation of Revenue [Line Items] | |||
Revenue recognized in the period | $ | $ 12.3 | ||
Marketplace Revenue | |||
Disaggregation of Revenue [Line Items] | |||
Listing fee per item | $ / item | 0.20 | ||
Period over which listing fee is recognized | 4 months | ||
Fee for each completed transaction, percent | 5% | 6.50% | |
Marketplace Revenue | Reverb | |||
Disaggregation of Revenue [Line Items] | |||
Fee for each completed transaction, percent | 5% | ||
Marketplace Revenue | Elo7 | |||
Disaggregation of Revenue [Line Items] | |||
Fee for each completed transaction, percent | 7% | ||
Marketplace Revenue | Depop | |||
Disaggregation of Revenue [Line Items] | |||
Fee for each completed transaction, percent | 10% | ||
Offsite Advertising | Minimum | |||
Disaggregation of Revenue [Line Items] | |||
Direct checkout fees, percent | 12% | ||
Offsite Advertising | Maximum | |||
Disaggregation of Revenue [Line Items] | |||
Direct checkout fees, percent | 15% | ||
Etsy Payments Processing Fees | Minimum | |||
Disaggregation of Revenue [Line Items] | |||
Direct checkout fees, percent | 3% | ||
Etsy Payments Processing Fees | Maximum | |||
Disaggregation of Revenue [Line Items] | |||
Direct checkout fees, percent | 4.50% |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies - Marketing (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Advertising expense | $ 581.1 | $ 559.3 | $ 442.2 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies - Stock-Based Compensation (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award requisite service period | 4 years |
Restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award requisite service period | 4 years |
Basis of Presentation and Sum_7
Basis of Presentation and Summary of Significant Accounting Policies - Segment Data (Details) | 12 Months Ended |
Dec. 31, 2022 segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 4 |
Number of reportable segments | 1 |
Basis of Presentation and Sum_8
Basis of Presentation and Summary of Significant Accounting Policies - Cash, Cash Equivalents and Short- and Long-term Investments (Details) | Dec. 31, 2022 |
Weighted Average | |
Debt Securities, Available-for-sale [Line Items] | |
Available-for-sale debt securities, investment maturity | 12 months |
Maximum | |
Debt Securities, Available-for-sale [Line Items] | |
Available-for-sale debt securities, investment maturity | 37 months |
Basis of Presentation and Sum_9
Basis of Presentation and Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash | $ 5,341 | $ 5,341 | $ 5,341 | $ 5,341 |
Office Building | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash | $ 5,300 | $ 5,300 |
Basis of Presentation and Su_10
Basis of Presentation and Summary of Significant Accounting Policies - Fair Value of Financial Instruments (Details) - Convertible Debt | Jun. 30, 2021 | Aug. 31, 2020 | Sep. 30, 2019 |
2020 Notes | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate, stated percentage | 0.125% | ||
2019 Notes | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate, stated percentage | 0.125% | ||
2021 Notes | |||
Debt Instrument [Line Items] | |||
Debt instrument, interest rate, stated percentage | 0.25% |
Basis of Presentation and Su_11
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Allowance Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Balance as of the beginning of period | $ 7,730 | $ 9,757 | $ 5,033 |
Provision for expected credit losses | 12,464 | 16,031 | 15,033 |
Amounts written off, net of recoveries | (11,891) | (18,058) | (10,309) |
Balance as of the end of period | $ 8,303 | $ 7,730 | $ 9,757 |
Basis of Presentation and Su_12
Basis of Presentation and Summary of Significant Accounting Policies - Website Development and Internal-use Software Costs (Details) - Developed technology | 12 Months Ended |
Dec. 31, 2022 | |
Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Basis of Presentation and Su_13
Basis of Presentation and Summary of Significant Accounting Policies - Goodwill and Impairment of Long-Lived Assets (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||||
Number of operating segments | segment | 4 | |||
Number of reportable segments | segment | 1 | |||
Impairment of finite-lived intangible assets and other long-lived assets | $ 0 | $ 0 | $ 0 | |
Elo7 | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment of finite-lived intangible assets and other long-lived assets | $ 0 | |||
Depop | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment of finite-lived intangible assets and other long-lived assets | $ 0 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 2,566,111 | $ 2,329,114 | $ 1,725,625 |
Marketplace revenue | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | 1,910,887 | 1,745,824 | 1,303,126 |
Services revenue | |||
Disaggregation of Revenue [Line Items] | |||
Revenue | $ 655,224 | $ 583,290 | $ 422,499 |
Income Taxes - Domestic and For
Income Taxes - Domestic and Foreign Components of Income Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 225,685 | $ 274,354 | $ 206,481 |
International | (887,663) | 197,300 | 159,228 |
(Loss) income before income taxes | $ (661,978) | $ 471,654 | $ 365,709 |
Income Taxes - Income Tax Benef
Income Taxes - Income Tax Benefit (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
U.S. Federal | $ 46,700 | $ 23,118 | $ 4,854 |
U.S. State | 16,036 | 12,754 | 3,953 |
International | 24,877 | 31,227 | 5,455 |
Total current | 87,613 | 67,099 | 14,262 |
Deferred: | |||
U.S. Federal | (18,753) | (53,328) | (7,684) |
U.S. State | (7,866) | (14,843) | (4,543) |
International | (28,684) | (20,781) | 14,428 |
Total deferred | (55,303) | (88,952) | 2,201 |
Total income tax provision (benefit) | $ 32,310 | $ (21,853) | $ 16,463 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Income tax (benefit) provision | $ 32,310 | $ (21,853) | $ 16,463 | |
Effective income tax rate | (4.90%) | (4.60%) | 4.50% | |
Unrecognized tax benefits | $ 35,158 | $ 28,842 | $ 23,738 | $ 19,933 |
Unrecognized tax benefits that would impact effective tax rate favorably | 34,100 | |||
Reduction of gross unrecognized tax benefits that is reasonably possible in the next 12 months | $ 2,100 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of the Income Tax Benefit at the U.S. Federal Statutory Income Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Income tax (benefit) provision at the federal statutory rate | $ (139,015) | $ 99,047 | $ 76,799 |
State and local income taxes, net of federal benefit | 10,516 | 11,134 | 7,693 |
Foreign income tax rate differential | (89,903) | (26,215) | (13,193) |
Stock-based compensation | (12,863) | (83,207) | (45,391) |
Research and development credit | (19,603) | (23,396) | (15,156) |
U.S. tax on foreign earnings, net of foreign income deduction | 3,588 | (5,155) | 3,923 |
Non-deductible acquisition costs | 1,204 | 5,643 | 0 |
Non-deductible goodwill impairment | 274,492 | 0 | 0 |
Other | 3,894 | 296 | 1,788 |
Total income tax provision (benefit) | $ 32,310 | $ (21,853) | $ 16,463 |
Income Taxes - Significant Comp
Income Taxes - Significant Component of Deferred Tax Assets (Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 66,410 | $ 48,689 |
Research and development credit carryforwards | 0 | 367 |
Capitalized research expenses | 63,901 | 5,036 |
Convertible debt | 40,159 | 47,142 |
Depreciation | 7,051 | 42,019 |
Lease liability | 33,253 | 35,871 |
Stock-based compensation expense | 25,151 | 19,319 |
Accrued bonus | 9,478 | 11,850 |
Excess tax basis in intangible assets | 1,924 | 1,585 |
Other deferred tax assets | 13,443 | 14,651 |
Total deferred tax assets | 260,770 | 226,529 |
Less: valuation allowance | 3,524 | 1,834 |
Total net deferred tax asset | 257,246 | 224,695 |
Deferred tax liabilities: | ||
Excess book basis in intangible assets | (147,790) | (173,097) |
Right-of-use asset | (31,864) | (34,612) |
Other deferred tax liabilities | (821) | (607) |
Total deferred tax liabilities | (180,475) | (208,316) |
Net deferred tax assets | $ 76,771 | $ 16,379 |
Income Taxes - Summary of Tax C
Income Taxes - Summary of Tax Credit Carryforwards and Operating Loss Carryforwards (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Domestic Tax Authority | |
Operating Loss Carryforwards [Line Items] | |
Tax credit carryforwards | $ 1,289 |
State and Local Jurisdiction | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 5,789 |
Foreign Tax Authority | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 257,006 |
Income Taxes - Summary of Valua
Income Taxes - Summary of Valuation Allowance Activity (Details) - Valuation Allowance of Deferred Tax Assets - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance as of the beginning of period | $ 1,834 | $ 1,398 | $ 883 |
Additions charged to expense | 1,796 | 580 | 506 |
Deletions credited to expense | 0 | (112) | (101) |
Currency translation and other balance sheet activity | (106) | (32) | 110 |
Balance as of the end of period | $ 3,524 | $ 1,834 | $ 1,398 |
Income Taxes - Summary of Unrec
Income Taxes - Summary of Unrecognized Tax Benefits Activity (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance as of the beginning of period | $ 28,842 | $ 23,738 | $ 19,933 |
Additions based on tax positions related to the current year | 5,206 | 5,024 | 2,507 |
Additions for tax positions of prior years | 1,754 | 122 | 1,576 |
Reductions for tax provisions of prior years | (509) | 0 | (278) |
Settlements | (107) | 0 | 0 |
Currency translation | (28) | (42) | 0 |
Balance as of the end of period | $ 35,158 | $ 28,842 | $ 23,738 |
Net (Loss) Income Per Share- Ca
Net (Loss) Income Per Share- Calculation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | |||
Net (loss) income | $ (694,288) | $ 493,507 | $ 349,246 |
Add back interest expense, net of tax attributable to assumed conversion of convertible senior notes | 0 | 4,900 | 17,880 |
Net (loss) income attributable to common stockholders—diluted | $ (694,288) | $ 498,407 | $ 367,126 |
Denominator: | |||
Weighted average common shares outstanding—basic (in shares) | 126,778,626 | 127,224,974 | 121,251,588 |
Weighted average common shares outstanding—diluted (in shares) | 126,778,626 | 146,683,324 | 136,414,592 |
Net income per share attributable to common stockholders—basic (in dollars per shares) | $ (5.48) | $ 3.88 | $ 2.88 |
Net income per share attributable to common stockholders—diluted (in dollars per share) | $ (5.48) | $ 3.40 | $ 2.69 |
Common Stock | |||
Denominator: | |||
Dilutive effect of assumed conversion (in shares) | 0 | 4,149,248 | 4,492,550 |
Restricted stock units | |||
Denominator: | |||
Dilutive effect of assumed conversion (in shares) | 0 | 1,995,336 | 2,046,981 |
Convertible senior notes | |||
Denominator: | |||
Dilutive effect of assumed conversion of convertible senior notes | 0 | 13,313,766 | 8,623,473 |
Net (Loss) Income Per Share - S
Net (Loss) Income Per Share - Summary of Shares Excluded from the Calculation of Diluted Net Income Per Share (Details) - shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of earnings per share (in shares) | 22,924,462 | 733,716 | 8,629,553 |
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) | 3,127,333 | 149,683 | 3,711 |
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) | 5,081,194 | 584,033 | 71 |
Convertible senior notes | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Anti-dilutive securities excluded from computation of earnings per share (in shares) | 14,715,935 | 0 | 8,625,771 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||||
Jul. 12, 2021 | Jul. 02, 2021 | Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||||||
Cash consideration paid | $ 0 | $ 1,699,974 | $ 0 | |||
Revenue | 2,566,111 | 2,329,114 | 1,725,625 | |||
Net loss | 694,288 | (493,507) | (349,246) | |||
Depop | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of consideration transferred | $ 1,493,000 | |||||
Cash consideration paid | 1,489,000 | |||||
Precombination service awards, replacement awards | $ 4,800 | |||||
Elo7 | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of consideration transferred | $ 212,100 | |||||
Cash consideration paid | 211,300 | |||||
Precombination service awards, replacement awards | $ 800 | |||||
Depop And Elo7 | ||||||
Business Acquisition [Line Items] | ||||||
Revenue | $ 36,700 | |||||
Net loss | $ 59,100 | |||||
Acquisition-related expenses | $ 2,800 | 36,700 | ||||
Pro forma net loss | (492,732) | (319,669) | ||||
Depop And Elo7 | Acquisition-related Costs | ||||||
Business Acquisition [Line Items] | ||||||
Pro forma net loss | $ 60,100 | $ (2,400) |
Business Combinations - Purchas
Business Combinations - Purchase Price Allocation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Jul. 12, 2021 | Jul. 02, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 137,724 | $ 1,371,064 | $ 140,810 | ||
Developed technology | Minimum | |||||
Business Acquisition [Line Items] | |||||
Estimated useful lives | 3 years | ||||
Developed technology | Maximum | |||||
Business Acquisition [Line Items] | |||||
Estimated useful lives | 5 years | ||||
Depop | |||||
Business Acquisition [Line Items] | |||||
Current assets | $ 4,288 | ||||
Goodwill | 1,118,855 | ||||
Current liabilities | (18,878) | ||||
Non-current liabilities | (27,957) | ||||
Deferred tax liability, net | (78,872) | ||||
Total purchase price | 1,492,823 | ||||
Depop | Trademark | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangibles | $ 249,820 | ||||
Estimated useful lives | 20 years | ||||
Depop | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangibles | $ 148,504 | ||||
Estimated useful lives | 13 years | ||||
Depop | Property and equipment other | |||||
Business Acquisition [Line Items] | |||||
Property and equipment | $ 1,299 | ||||
Depop | Property and equipment other | Minimum | |||||
Business Acquisition [Line Items] | |||||
Estimated useful lives | 2 years | ||||
Depop | Property and equipment other | Maximum | |||||
Business Acquisition [Line Items] | |||||
Estimated useful lives | 5 years | ||||
Depop | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Property and equipment | $ 95,764 | ||||
Estimated useful lives | 5 years | ||||
Elo7 | |||||
Business Acquisition [Line Items] | |||||
Current assets | $ 2,721 | ||||
Goodwill | 157,187 | ||||
Non-current assets | 2,412 | ||||
Current liabilities | (3,406) | ||||
Non-current liabilities | (2,691) | ||||
Deferred tax liability, net | (22,727) | ||||
Total purchase price | 212,141 | ||||
Elo7 | Trademark | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangibles | $ 22,187 | ||||
Estimated useful lives | 15 years | ||||
Elo7 | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangibles | $ 44,374 | ||||
Estimated useful lives | 15 years | ||||
Elo7 | Developed technology | |||||
Business Acquisition [Line Items] | |||||
Property and equipment | $ 12,084 | ||||
Estimated useful lives | 5 years |
Business Combinations - Unaudit
Business Combinations - Unaudited Supplemental Pro Forma Information (Details) - Depop And Elo7 - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||
Revenue | $ 2,373,592 | $ 1,801,690 |
Net income | $ 492,732 | $ 319,669 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Summary of Changes in the Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill [Roll Forward] | |||
Balance as of the beginning of the period | $ 1,371,064 | $ 140,810 | |
Business combinations | 0 | 1,276,042 | |
Impairment | (1,045,022) | 0 | $ 0 |
Foreign currency translation adjustments | (188,318) | (45,788) | |
Balance as of the end of the period | $ 137,724 | $ 1,371,064 | $ 140,810 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 USD ($) reporting_unit | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||||
Number of operating segments | segment | 4 | |||
Goodwill impairment | $ 1,045,022 | $ 0 | $ 0 | |
Impairment of finite-lived intangible assets and other long-lived assets | 0 | 0 | 0 | |
Number of reporting units | reporting_unit | 4 | |||
Amortization expense of intangible assets | $ 41,300 | $ 28,400 | $ 15,200 | |
Elo7 | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Goodwill impairment | $ 147,100 | |||
Impairment of finite-lived intangible assets and other long-lived assets | 0 | |||
Depop | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Goodwill impairment | 897,900 | |||
Impairment of finite-lived intangible assets and other long-lived assets | 0 | |||
Etsy And Reverb | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Goodwill impairment | $ 0 | |||
Number of reporting units | reporting_unit | 2 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross book value | $ 627,585 | $ 660,322 |
Accumulated amortization | (92,179) | (53,152) |
Total amortization expense | $ 535,406 | $ 607,170 |
Weighted-Average Remaining Life (in years) | 14 years 2 months 12 days | 15 years 2 months 12 days |
Trademark | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross book value | $ 318,489 | $ 342,753 |
Accumulated amortization | (35,873) | (18,817) |
Total amortization expense | $ 282,616 | $ 323,936 |
Weighted-Average Remaining Life (in years) | 16 years 8 months 12 days | 17 years 9 months 18 days |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross book value | $ 265,429 | $ 278,311 |
Accumulated amortization | (39,808) | (21,243) |
Total amortization expense | $ 225,621 | $ 257,068 |
Weighted-Average Remaining Life (in years) | 11 years 10 months 24 days | 12 years 10 months 24 days |
Referral agreement | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross book value | $ 34,050 | $ 36,109 |
Accumulated amortization | (15,404) | (12,677) |
Total amortization expense | $ 18,646 | $ 23,432 |
Weighted-Average Remaining Life (in years) | 5 years 6 months | 6 years 6 months |
Patent licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross book value | $ 9,617 | $ 3,149 |
Accumulated amortization | (1,094) | (415) |
Total amortization expense | $ 8,523 | $ 2,734 |
Weighted-Average Remaining Life (in years) | 9 years 10 months 24 days | 5 years 7 months 6 days |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Summary of Future Amortization Expense for Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2023 | $ 41,134 | |
2024 | 41,123 | |
2025 | 41,123 | |
2026 | 40,802 | |
2027 | 40,734 | |
Thereafter | 330,490 | |
Total amortization expense | $ 535,406 | $ 607,170 |
Segment and Geographic Inform_3
Segment and Geographic Information - Narrative (Details) | 12 Months Ended |
Dec. 31, 2022 segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 4 |
Number of reportable segments | 1 |
Segment and Geographic Inform_4
Segment and Geographic Information - Schedules of Segment and Geographic Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue, Major Customer [Line Items] | |||
Revenue | $ 2,566,111 | $ 2,329,114 | $ 1,725,625 |
United States | |||
Revenue, Major Customer [Line Items] | |||
Revenue | 1,429,650 | 1,393,637 | 1,150,725 |
United Kingdom | |||
Revenue, Major Customer [Line Items] | |||
Revenue | 343,788 | 329,203 | 195,827 |
All Other | |||
Revenue, Major Customer [Line Items] | |||
Revenue | $ 792,673 | $ 606,274 | $ 379,073 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Major Categories of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | $ 758,873 | $ 855,409 |
Gross Unrealized Holding Loss | (2,439) | (557) |
Gross Unrealized Holding Gain | 38 | 23 |
Fair Value | 756,472 | 854,875 |
Cash and Cash Equivalents | 388,446 | 565,425 |
Short-term investments | 250,413 | 204,416 |
Long-term Investments | 29,137 | 85,034 |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Gross Unrealized Holding Loss | (14) | |
Gross Unrealized Holding Gain | 1 | |
Fair Value | 25,222 | |
Fair Value, Inputs, Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 527,834 | 616,738 |
Gross Unrealized Holding Loss | (424) | (55) |
Gross Unrealized Holding Gain | 4 | 11 |
Fair Value | 527,414 | 616,694 |
Cash and Cash Equivalents | 377,309 | 556,427 |
Short-term investments | 61,629 | 52,632 |
Long-term Investments | 0 | 7,635 |
Fair Value, Inputs, Level 1 | Money Market Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 462,866 | 556,427 |
Gross Unrealized Holding Loss | 0 | 0 |
Gross Unrealized Holding Gain | 0 | 0 |
Fair Value | 462,866 | 556,427 |
Cash and Cash Equivalents | 374,314 | 556,427 |
Short-term investments | 76 | 0 |
Long-term Investments | 0 | 0 |
Funds receivable and seller accounts | 88,500 | 0 |
Fair Value, Inputs, Level 1 | U.S. Government securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 64,968 | 60,311 |
Gross Unrealized Holding Loss | (424) | (55) |
Gross Unrealized Holding Gain | 4 | 11 |
Fair Value | 64,548 | 60,267 |
Cash and Cash Equivalents | 2,995 | 0 |
Short-term investments | 61,553 | 52,632 |
Long-term Investments | 0 | 7,635 |
Fair Value, Inputs, Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 231,039 | 238,671 |
Gross Unrealized Holding Loss | (2,015) | (502) |
Gross Unrealized Holding Gain | 34 | 12 |
Fair Value | 229,058 | 238,181 |
Cash and Cash Equivalents | 11,137 | 8,998 |
Short-term investments | 188,784 | 151,784 |
Long-term Investments | 29,137 | 77,399 |
Fair Value, Inputs, Level 2 | U.S. agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 10,053 | |
Gross Unrealized Holding Loss | (1) | |
Gross Unrealized Holding Gain | 3 | |
Fair Value | 10,055 | |
Cash and Cash Equivalents | 0 | |
Short-term investments | 10,055 | |
Long-term Investments | 0 | |
Fair Value, Inputs, Level 2 | Certificate of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 40,915 | 20,709 |
Gross Unrealized Holding Loss | (184) | (7) |
Gross Unrealized Holding Gain | 7 | 1 |
Fair Value | 40,738 | 20,703 |
Cash and Cash Equivalents | 5,471 | 0 |
Short-term investments | 35,267 | 20,703 |
Long-term Investments | 0 | 0 |
Fair Value, Inputs, Level 2 | Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 57,777 | 25,235 |
Gross Unrealized Holding Loss | (101) | |
Gross Unrealized Holding Gain | 18 | |
Fair Value | 57,694 | |
Cash and Cash Equivalents | 4,454 | 8,998 |
Short-term investments | 53,240 | 16,224 |
Long-term Investments | 0 | 0 |
Fair Value, Inputs, Level 2 | Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cost | 122,294 | 192,727 |
Gross Unrealized Holding Loss | (1,729) | (481) |
Gross Unrealized Holding Gain | 6 | 10 |
Fair Value | 120,571 | 192,256 |
Cash and Cash Equivalents | 1,212 | 0 |
Short-term investments | 90,222 | 114,857 |
Long-term Investments | $ 29,137 | $ 77,399 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Gross Unrealized Holding Loss | $ 1,607 | $ 0 |
Fair Value | $ 57,544 | $ 0 |
Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale debt securities, investment maturity | 12 months | |
Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale debt securities, investment maturity | 37 months |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Unrealized Loss and Fair Value of Debt Securities Available-for-Sale (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Less than 12 months in a continuous unrealized loss position | ||
Gross Unrealized Holding Loss | $ (546) | |
Fair Value | 121,544 | |
12 months or longer in a continuous unrealized loss position | ||
Gross Unrealized Holding Loss | (1,607) | $ 0 |
Fair Value | 57,544 | $ 0 |
Corporate bonds | ||
Less than 12 months in a continuous unrealized loss position | ||
Gross Unrealized Holding Loss | (281) | |
Fair Value | 70,469 | |
12 months or longer in a continuous unrealized loss position | ||
Gross Unrealized Holding Loss | (1,448) | |
Fair Value | 50,102 | |
U.S. Government securities | ||
Less than 12 months in a continuous unrealized loss position | ||
Gross Unrealized Holding Loss | (265) | |
Fair Value | 51,075 | |
12 months or longer in a continuous unrealized loss position | ||
Gross Unrealized Holding Loss | (159) | |
Fair Value | $ 7,442 |
Fair Value Measurements - Sch_3
Fair Value Measurements - Schedule of Estimated Fair Value Liability Component (Details) - Fair Value, Inputs, Level 2 - Convertible Debt - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | $ 2,279,640 | $ 2,275,418 |
Carrying Value | 2021 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 989,629 | 987,729 |
Carrying Value | 2020 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 644,431 | 643,237 |
Carrying Value | 2019 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 645,536 | 644,390 |
Carrying Value | 2018 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 44 | 62 |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 2,508,036 | 3,673,537 |
Fair Value | 2021 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 863,300 | 1,165,519 |
Fair Value | 2020 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 646,230 | 862,774 |
Fair Value | 2019 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | 998,361 | 1,644,869 |
Fair Value | 2018 Notes | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Long-term debt, fair value | $ 145 | $ 375 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 453,933 | $ 432,105 |
Less: Accumulated depreciation and amortization | 204,189 | 157,043 |
Property and equipment, net | $ 249,744 | 275,062 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Property and equipment, gross | $ 12,820 | 8,037 |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 11,398 | 7,170 |
Furniture and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 2 years | |
Furniture and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 4 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 56,095 | 48,145 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 419 | 10,835 |
Building | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 133,063 | 133,063 |
Website development and internal-use software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 240,138 | $ 224,855 |
Website development and internal-use software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Website development and internal-use software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 5 years |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 55.5 | $ 45.8 | $ 43 |
Developed technology | |||
Property, Plant and Equipment [Line Items] | |||
Amortization expense | $ 37.3 | $ 30 | $ 22.6 |
Leases - Elements of Lease Expe
Leases - Elements of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating lease cost | $ 8,251 | $ 6,320 | $ 5,847 |
Finance lease cost: | |||
Amortization of right-of-use assets | 7,174 | 9,139 | 10,190 |
Interest on lease liabilities | 5,392 | 3,044 | 2,576 |
Total finance lease cost | 12,566 | 12,183 | 12,766 |
Other lease income, net | 1,220 | 1,193 | 1,322 |
Total lease cost | $ 22,037 | $ 19,696 | $ 19,935 |
Leases - Lease-related Assets a
Leases - Lease-related Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating leases: | ||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other assets | Other assets |
Other assets | $ 38,784 | $ 45,951 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Other current liabilities | Other current liabilities |
Other current liabilities | $ 4,233 | $ 4,018 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other liabilities | Other liabilities |
Other liabilities | $ 38,085 | $ 43,746 |
Total operating lease liabilities | $ 42,318 | $ 47,764 |
Finance leases: | ||
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property and equipment, net | Property and equipment, net |
Property and equipment, net | $ 102,169 | $ 109,131 |
Finance lease obligations—current | 4,731 | 2,418 |
Finance lease obligations—net of current portion | 105,699 | 110,283 |
Total finance lease liabilities | $ 110,430 | $ 112,701 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Term and Weighted Average Discount Rate (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Weighted average remaining lease term, operating leases | 14 years 6 months 14 days | 14 years 8 months 1 day |
Weighted average remaining lease term, finance leases | 16 years 5 months 26 days | 17 years 4 months 28 days |
Weighted average discount rate, operating leases | 4.54% | 4.46% |
Weighted average discount rate, finance leases | 4.73% | 4.72% |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating cash flows used in operating leases | $ (7,871) | $ (6,442) | $ (5,519) |
Operating cash flows used in finance leases | (5,387) | (3,025) | (2,551) |
Finance cash flows used in finance leases | $ (6,307) | $ (8,864) | $ (9,211) |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments Under Non-cancelable Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Leases | ||
2023 | $ 5,783 | |
2024 | 6,190 | |
2025 | 5,428 | |
2026 | 778 | |
2027 | 272 | |
Thereafter | 41,565 | |
Total future minimum lease payments | 60,016 | |
Imputed interest | 17,698 | |
Total operating lease liabilities | 42,318 | $ 47,764 |
Finance Leases | ||
2023 | 9,036 | |
2024 | 10,999 | |
2025 | 10,760 | |
2026 | 100 | |
2027 | 882 | |
Thereafter | 134,997 | |
Total future minimum lease payments | 166,774 | |
Imputed interest | 56,344 | |
Total finance lease liabilities | $ 110,430 | $ 112,701 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Pass-through marketplace tax collection obligation | $ 129,591 | $ 136,360 |
Vendor accruals | 127,791 | 115,593 |
Employee compensation-related liabilities | 63,718 | 66,477 |
Taxes payable | 10,134 | 9,688 |
Total accrued expenses | $ 331,234 | $ 328,118 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Aug. 31, 2020 | Sep. 30, 2019 | Mar. 31, 2018 |
Debt Instrument [Line Items] | ||||||
Long-term debt, net | $ 2,279,640 | $ 2,275,418 | ||||
Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal | 2,299,976 | 2,300,020 | ||||
Unamortized debt issuance costs | 20,336 | 24,602 | ||||
Long-term debt, net | 2,279,640 | 2,275,418 | ||||
2021 Notes | Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal | 1,000,000 | 1,000,000 | $ 1,000,000 | |||
Unamortized debt issuance costs | 10,371 | 12,271 | ||||
Long-term debt, net | 989,629 | 987,729 | ||||
2020 Notes | Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal | 650,000 | 650,000 | $ 650,000 | |||
Unamortized debt issuance costs | 5,569 | 6,763 | ||||
Long-term debt, net | 644,431 | 643,237 | ||||
2019 Notes | Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal | $ 650,000 | |||||
Principal, net of conversion notices | 649,932 | 649,958 | ||||
Unamortized debt issuance costs | 4,396 | 5,568 | ||||
Long-term debt, net | 645,536 | 644,390 | ||||
2018 Notes | Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal | $ 345,000 | |||||
Principal, net of conversion notices | 44 | 62 | ||||
Unamortized debt issuance costs | 0 | 0 | ||||
Long-term debt, net | $ 44 | $ 62 |
Debt - Schedule of Maturities o
Debt - Schedule of Maturities of Convertible Notes (Details) - Convertible Debt | 1 Months Ended | ||||
Jun. 30, 2021 $ / shares | Aug. 31, 2020 $ / shares | Sep. 30, 2019 $ / shares | Mar. 31, 2018 $ / shares | Dec. 31, 2022 | |
2021 Notes | |||||
Debt Instrument [Line Items] | |||||
Conversion ratio | 0.0040518 | ||||
Conversion price (in dollars per share) | $ 246.80 | ||||
Effective interest rate | 0.40% | ||||
2020 Notes | |||||
Debt Instrument [Line Items] | |||||
Conversion ratio | 0.0050007 | ||||
Conversion price (in dollars per share) | $ 199.97 | ||||
Effective interest rate | 0.30% | ||||
2019 Notes | |||||
Debt Instrument [Line Items] | |||||
Conversion ratio | 0.0114040 | ||||
Conversion price (in dollars per share) | $ 87.69 | ||||
Effective interest rate | 0.30% | ||||
2018 Notes | |||||
Debt Instrument [Line Items] | |||||
Conversion ratio | 0.0275691 | ||||
Conversion price (in dollars per share) | $ 36.27 | ||||
Effective interest rate | 0% |
Debt - Schedule of Interest Exp
Debt - Schedule of Interest Expense (Details) - Convertible Debt - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||
Total interest expense | $ 8,391 | $ 6,446 | $ 39,169 |
2021 Notes | |||
Debt Instrument [Line Items] | |||
Total interest expense | 4,400 | 2,411 | 0 |
2020 Notes | |||
Debt Instrument [Line Items] | |||
Total interest expense | 2,006 | 2,006 | 6,741 |
2019 Notes | |||
Debt Instrument [Line Items] | |||
Total interest expense | 1,985 | 1,985 | 21,441 |
2018 Notes | |||
Debt Instrument [Line Items] | |||
Total interest expense | $ 0 | $ 44 | $ 10,987 |
Debt - Schedule of Capped Call
Debt - Schedule of Capped Call Transactions (Details) - Convertible Debt - $ / shares | Jun. 08, 2021 | Aug. 19, 2020 | Sep. 18, 2019 | Mar. 08, 2018 | Aug. 31, 2020 | Sep. 30, 2019 | Mar. 31, 2018 |
2021 Capped Call Transactions | |||||||
Debt Instrument [Line Items] | |||||||
Transaction price cap (in dollars per share) | $ 340.42 | ||||||
Cap premium percentage over reported sales price | 100% | ||||||
2020 Capped Call Transactions | |||||||
Debt Instrument [Line Items] | |||||||
Transaction price cap (in dollars per share) | $ 327.83 | ||||||
Cap premium percentage over reported sales price | 150% | ||||||
2019 Capped Call Transactions | |||||||
Debt Instrument [Line Items] | |||||||
Transaction price cap (in dollars per share) | $ 148.63 | ||||||
Cap premium percentage over reported sales price | 150% | ||||||
2018 Capped Call Transactions | |||||||
Debt Instrument [Line Items] | |||||||
Transaction price cap (in dollars per share) | $ 52.76 | ||||||
Cap premium percentage over reported sales price | 100% |
Debt - 2021 Convertible Debt (D
Debt - 2021 Convertible Debt (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Jun. 08, 2021 USD ($) $ / shares | Aug. 19, 2020 | Jun. 30, 2021 USD ($) day | Aug. 31, 2020 USD ($) $ / shares | Dec. 31, 2022 USD ($) day | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Debt Instrument [Line Items] | |||||||
Purchase of capped calls | $ 0 | $ 85,000 | $ 74,685 | ||||
Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Principal | $ 2,299,976 | 2,300,020 | |||||
Convertible Debt | Debt Instrument, Redemption, Period One | |||||||
Debt Instrument [Line Items] | |||||||
Threshold percentage of stock price trigger | 130% | ||||||
Threshold trading days | day | 20 | ||||||
Threshold consecutive trading days | day | 30 | ||||||
Convertible Debt | 2020 Capped Call Transactions | |||||||
Debt Instrument [Line Items] | |||||||
Purchase of capped calls | $ 74,700 | ||||||
Transaction price cap (in dollars per share) | $ / shares | $ 327.83 | ||||||
Cap premium percentage over reported sales price | 150% | ||||||
Convertible Debt | 2021 Notes | |||||||
Debt Instrument [Line Items] | |||||||
Principal | $ 1,000,000 | $ 1,000,000 | $ 1,000,000 | ||||
Proceeds from issuance of convertible senior notes | $ 986,700 | ||||||
Convertible Debt | 2021 Notes | Debt Instrument, Redemption, Period One | |||||||
Debt Instrument [Line Items] | |||||||
Threshold percentage of stock price trigger | 130% | ||||||
Threshold trading days | day | 20 | ||||||
Threshold consecutive trading days | day | 30 | ||||||
Convertible Debt | 2021 Notes | Debt Instrument, Redemption, Period Three | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price percent | 100% | ||||||
Convertible Debt | 2021 Capped Call Transactions | |||||||
Debt Instrument [Line Items] | |||||||
Purchase of capped calls | $ 85,000 | ||||||
Transaction price cap (in dollars per share) | $ / shares | $ 340.42 | ||||||
Cap premium percentage over reported sales price | 100% |
Debt - 2020 Convertible Debt (D
Debt - 2020 Convertible Debt (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2020 USD ($) day $ / shares | Dec. 31, 2022 USD ($) day | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Debt Instrument [Line Items] | ||||
Purchase of capped calls | $ 0 | $ 85,000 | $ 74,685 | |
Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Debt instrument | $ 2,299,976 | 2,300,020 | ||
Convertible Debt | Debt Instrument, Redemption, Period One | ||||
Debt Instrument [Line Items] | ||||
Threshold trading days | day | 20 | |||
Threshold consecutive trading days | day | 30 | |||
Threshold percentage of stock price trigger | 130% | |||
Convertible Debt | Convertible Senior Notes Due 2027 | ||||
Debt Instrument [Line Items] | ||||
Debt instrument | $ 650,000 | $ 650,000 | $ 650,000 | |
Proceeds from issuance of convertible senior notes | $ 639,500 | |||
Conversion price (in dollars per share) | $ / shares | $ 199.97 | |||
Redemption price, percentage | 100% | |||
Convertible Debt | Convertible Senior Notes Due 2027 | Debt Instrument, Redemption, Period Two | ||||
Debt Instrument [Line Items] | ||||
Threshold trading days | day | 5 | |||
Threshold consecutive trading days | day | 10 | |||
Threshold percentage of stock price trigger | 98% | |||
Convertible Debt | 2020 Capped Call Transactions | ||||
Debt Instrument [Line Items] | ||||
Purchase of capped calls | $ 74,700 |
Debt - 2019 Convertible Debt (D
Debt - 2019 Convertible Debt (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 USD ($) $ / shares | Dec. 31, 2022 USD ($) day | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Debt Instrument [Line Items] | ||||
Purchase of capped calls | $ 0 | $ 85,000 | $ 74,685 | |
Convertible Debt | ||||
Debt Instrument [Line Items] | ||||
Debt instrument | $ 2,299,976 | $ 2,300,020 | ||
Convertible Debt | 2019 Notes | ||||
Debt Instrument [Line Items] | ||||
Debt instrument | $ 650,000 | |||
Proceeds from issuance of convertible senior notes | $ 639,500 | |||
Conversion price (in dollars per share) | $ / shares | $ 87.69 | |||
Redemption price, percentage | 100% | |||
Convertible Debt | 2019 Capped Call Transactions | ||||
Debt Instrument [Line Items] | ||||
Purchase of capped calls | $ 76,200 | |||
Convertible Debt | Debt Instrument, Redemption, Period One | ||||
Debt Instrument [Line Items] | ||||
Threshold trading days | day | 20 | |||
Threshold consecutive trading days | day | 30 | |||
Threshold percentage of stock price trigger | 130% |
Debt - 2018 Convertible Debt (D
Debt - 2018 Convertible Debt (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Mar. 08, 2018 | Mar. 31, 2018 USD ($) $ / shares | Sep. 30, 2020 USD ($) shares | Dec. 31, 2022 USD ($) day shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 USD ($) shares | |
Debt Instrument [Line Items] | ||||||
Settlement of convertible senior notes | $ 44 | $ 43,900 | $ 137,168 | |||
Shares repurchased (in shares) | shares | 3,958,155 | 554,718 | 1,161,947 | |||
Value of shares repurchased | $ 425,727 | $ 302,774 | $ 268,653 | |||
Issuance of convertible senior notes, net of issuance costs and taxes | 102,131 | |||||
Loss on extinguishment of debt | 0 | 0 | (16,855) | |||
Purchase of capped calls | 0 | 85,000 | $ 74,685 | |||
Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument | $ 2,299,976 | 2,300,020 | ||||
Convertible Debt | Debt Instrument, Redemption, Period One | ||||||
Debt Instrument [Line Items] | ||||||
Threshold trading days | day | 20 | |||||
Threshold consecutive trading days | day | 30 | |||||
Threshold percentage of stock price trigger | 130% | |||||
Convertible Debt | 2018 Notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument | $ 345,000 | |||||
Proceeds from issuance of convertible senior notes | $ 335,000 | |||||
Conversion price (in dollars per share) | $ / shares | $ 36.27 | |||||
Settlement of convertible senior notes | $ 137,200 | $ 43,900 | ||||
Debt conversion, converted instrument, (In Shares) | shares | 7,300,000 | 1,000,000 | 7,300,000 | |||
Debt instrument conversion amount | $ 301,100 | $ 43,900 | ||||
Shares repurchased (in shares) | shares | 1,300,000 | |||||
Value of shares repurchased | $ 166,200 | |||||
Issuance of convertible senior notes, net of issuance costs and taxes | 143,200 | |||||
Loss on extinguishment of debt | $ 16,900 | |||||
Convertible Debt | 2018 Capped Call Transactions | ||||||
Debt Instrument [Line Items] | ||||||
Purchase of capped calls | $ 34,200 | |||||
Cap premium percentage over reported sales price | 100% |
Debt - 2019 Credit Agreement (D
Debt - 2019 Credit Agreement (Details) - Credit Agreement - USD ($) $ in Millions | Feb. 25, 2019 | Dec. 31, 2022 | Dec. 31, 2021 |
Line of Credit Facility [Line Items] | |||
Maximum required secured net leverage ratio | 300% | ||
Maximum required secured net leverage ratio, certain material acquisitions | 350% | ||
Minimum required interest coverage ratio | 250% | ||
Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Line of credit, maximum borrowing capacity | $ 200 | ||
Maximum unrestricted cash | 100 | ||
Contingent right to increase maximum borrowing capacity amount | $ 100 | ||
Line of credit facility, amount outstanding | $ 0 | $ 0 | |
Revolving Credit Facility | Minimum | |||
Line of Credit Facility [Line Items] | |||
Commitment fee amount | 0.20% | ||
Revolving Credit Facility | Maximum | |||
Line of Credit Facility [Line Items] | |||
Commitment fee amount | 0.35% | ||
Revolving Credit Facility | Federal Funds Effective Swap Rate | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.50% | ||
Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 1% | ||
Revolving Credit Facility | One-Month London Interbank Offered Rate (LIBOR) Plus 1% | Minimum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.25% | ||
Revolving Credit Facility | One-Month London Interbank Offered Rate (LIBOR) Plus 1% | Maximum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 0.875% | ||
Revolving Credit Facility | London Interbank Offered Rate (LIBOR), Adjusted | Minimum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 1.25% | ||
Revolving Credit Facility | London Interbank Offered Rate (LIBOR), Adjusted | Maximum | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 1.875% | ||
Letter of Credit | |||
Line of Credit Facility [Line Items] | |||
Line of credit, maximum borrowing capacity | $ 30 | ||
Bridge Loan | |||
Line of Credit Facility [Line Items] | |||
Line of credit, maximum borrowing capacity | $ 10 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Loss Contingencies [Line Items] | ||
Purchase obligation | $ 388,336 | |
Purchase obligation, term | 4 years | |
Non-income Tax Obligations | ||
Loss Contingencies [Line Items] | ||
Non-income tax obligation reserve | $ 43,200 | $ 38,800 |
Non-income Tax Obligations | Reverb | ||
Loss Contingencies [Line Items] | ||
Non-income tax obligation reserve | 30,400 | |
Indemnification asset | 3,000 | |
Non-income Tax Obligations | Depop And Elo7 | ||
Loss Contingencies [Line Items] | ||
Non-income tax obligation reserve | 32,300 | |
Indemnification asset | $ 3,800 |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Purchase Obligations (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Purchase Obligations | |
2023 | $ 61,319 |
2024 | 115,148 |
2025 | 132,310 |
2026 | 71,295 |
2027 | 1,295 |
Thereafter | 6,969 |
Total purchase obligations | $ 388,336 |
Stockholders' Equity - Common a
Stockholders' Equity - Common and Convertible Preferred Stock (Details) | 12 Months Ended | |||
Dec. 31, 2022 USD ($) vote $ / shares shares | Dec. 31, 2021 $ / shares shares | Dec. 31, 2020 shares | Dec. 31, 2019 shares | |
Class of Stock [Line Items] | ||||
Common stock, shares authorized (in shares) | 1,400,000,000 | 1,400,000,000 | ||
Common stock, shares outstanding (in shares) | 125,054,278 | 127,022,118 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||
Common stock, votes per share of stock held | vote | 1 | |||
Dividends declared for common stock | $ | $ 0 | |||
Preferred stock, shares authorized (in shares) | 25,000,000 | 25,000,000 | ||
Preferred stock, shares outstanding (in shares) | 0 | 0 | 0 | |
Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, shares outstanding (in shares) | 125,054,278 | 127,022,118 | 125,835,931 | 118,342,772 |
Stockholders' Equity - Stock Re
Stockholders' Equity - Stock Repurchases Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | May 01, 2022 | Nov. 01, 2018 | |
Class of Stock [Line Items] | |||||||
Authorized repurchase amount | $ 250,000 | $ 600,000 | $ 200,000 | ||||
Remaining Amount Authorized | $ 301,400 | ||||||
Stock repurchased (in shares) | 3,958,155 | 554,718 | 1,161,947 | ||||
Stock repurchased | $ 425,727 | $ 302,774 | $ 268,653 | ||||
Convertible Debt | 2021 Notes | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchased (in shares) | 1,100,000 | ||||||
Stock repurchased | $ 180,000 | ||||||
Convertible Debt | 2018 Notes | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchased (in shares) | 1,300,000 | ||||||
Stock repurchased | $ 166,200 | ||||||
Debt instrument conversion amount | $ 301,100 | $ 43,900 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Activity of Shares Repurchases (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Equity [Abstract] | |||
Shares repurchased (in shares) | 3,958,155 | 554,718 | 1,161,947 |
Average Price Paid Per Share (in dollars per share) | $ 107.56 | $ 221.33 | $ 88.20 |
Stock-based Compensation - Narr
Stock-based Compensation - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | 54 Months Ended | ||||
Jan. 02, 2023 | Jan. 03, 2022 | Jul. 12, 2021 | Jan. 04, 2021 | Jul. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2022 | |
Depop | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period | 3 years | ||||||
Weighted-average period for unrecognized compensation | 1 year 6 months 10 days | ||||||
Precombination service awards, replacement awards | $ 4.8 | ||||||
Unrecognized compensation | 44 | $ 4.6 | $ 4.6 | ||||
Depop | Common Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Deferred purchase price for post-combination share-based service arrangement | $ 44 | ||||||
Stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award expiration period | 10 years | ||||||
Award vesting period | 4 years | ||||||
Award vesting rights, percentage | 25% | ||||||
Interval vesting period | 6 months | ||||||
Award requisite service period | 4 years | ||||||
Unrecognized compensation | $ 14.3 | $ 14.3 | |||||
Weighted-average period for unrecognized compensation | 1 year 10 months 20 days | ||||||
Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period | 4 years | ||||||
Award vesting rights, percentage | 25% | ||||||
Interval vesting period | 6 months | ||||||
Award requisite service period | 4 years | ||||||
Weighted-average period for unrecognized compensation | 2 years 11 months 8 days | ||||||
Unrecognized compensation | $ 675.4 | $ 675.4 | |||||
Restricted stock units | Depop And Elo7 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate fair value of awards granted | $ 78.8 | ||||||
Precombination service awards, replacement awards | $ 5.6 | ||||||
Restricted stock units | Share-based Payment Arrangement, Tranche One | Depop And Elo7 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 25% | ||||||
Restricted stock units | Share-based Payment Arrangement, Tranche Two | Depop And Elo7 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 75% | ||||||
Financial Performance Based Restricted Stock Units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 0% | ||||||
Financial Performance Based Restricted Stock Units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting rights, percentage | 200% | ||||||
Total Shareholder Return Performance Based Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award measurement period | 3 years | ||||||
2015 Equity Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Potential annual share increase (in shares) | 7,050,000 | ||||||
Percentage of outstanding stock | 5% | ||||||
Maximum number of additional shares issued annually (in shares) | 6,351,106 | 6,291,797 | |||||
Number of shares authorized (in shares) | 50,391,850 | 50,391,850 | |||||
Number of shares available for grant (in shares) | 32,188,305 | 32,188,305 | |||||
2015 Equity Incentive Plan | Subsequent Event | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Maximum number of additional shares issued annually (in shares) | 6,252,714 |
Stock-based Compensation - Fair
Stock-based Compensation - Fair Value of Options Granted Using the Black-Scholes Pricing Model (Details) - Stock options | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected Volatility | 62.50% | 43.40% | 38.90% |
Risk-free interest rate | 3.40% | 0.80% | 0.30% |
Expected term (in years) | 4 years 7 months 6 days | 4 years 7 months 6 days | 5 years 6 months |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected Volatility | 57.40% | 41.70% | |
Risk-free interest rate | 1.20% | 1.70% | |
Expected term (in years) | 6 years 2 months 12 days | 6 years 2 months 12 days |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Shares | ||||
Outstanding, beginning balance (in shares) | 4,273,725 | 5,099,952 | 6,294,919 | |
Granted (in shares) | 9,916 | 198,193 | 654,296 | |
Exercised (in shares) | (816,620) | (994,456) | (1,834,773) | |
Forfeited/Cancelled (in shares) | (10,704) | (29,964) | (14,490) | |
Outstanding, ending balance (in shares) | 3,456,317 | 4,273,725 | 5,099,952 | 6,294,919 |
Total exercisable (in shares) | 3,041,998 | |||
Weighted-Average Exercise Price | ||||
Outstanding, beginning balance (in dollars per share) | $ 29.52 | $ 20.97 | $ 16.26 | |
Granted (in dollars per share) | 76.05 | 218.93 | 46.38 | |
Exercised (in dollars per share) | 18.40 | 22.83 | 13.80 | |
Forfeited/Cancelled (in dollars per share) | 126.22 | 47.86 | 32.15 | |
Outstanding, ending balance (in dollars per share) | 31.99 | $ 29.52 | $ 20.97 | $ 16.26 |
Total exercisable at Weighted-Average Exercise Price (in dollars per share) | $ 23.07 | |||
Weighted-Average Remaining Contract Term (in years) | ||||
Outstanding | 5 years 21 days | 5 years 11 months 26 days | 6 years 9 months 21 days | 7 years 2 months 26 days |
Total exercisable | 4 years 8 months 26 days | |||
Aggregate Intrinsic Value | ||||
Outstanding | $ 322,230 | $ 810,321 | $ 800,453 | $ 185,900 |
Total exercisable | $ 301,224 |
Stock-based Compensation - Weig
Stock-based Compensation - Weighted Average Grant Date Fair Value Options Granted and Awards Vested and Intrinsic Value of Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | |||
Weighted average grant date fair value of options granted (in shares) | $ 40.84 | $ 95 | $ 18.18 |
Intrinsic value of options exercised | $ 87,892 | $ 206,709 | $ 151,785 |
Fair value of awards vested | $ 195,929 | $ 96,592 | $ 60,622 |
Stock-based Compensation - Su_2
Stock-based Compensation - Summary of the Unvested RSUs (Details) - RSUs - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Shares | |||
Unvested at beginning of period (in shares) | 3,506,721 | 3,085,987 | 2,960,413 |
Granted (in shares) | 5,226,948 | 2,136,685 | 1,712,587 |
Vested (in shares) | (1,670,084) | (1,400,241) | (1,369,271) |
Forfeited/Canceled (in shares) | (669,799) | (315,710) | (217,742) |
Unvested at period end (in shares) | 6,393,786 | 3,506,721 | 3,085,987 |
Weighted-Average Fair Value | |||
Unvested at beginning of period (in dollars per share) | $ 137.87 | $ 50.28 | $ 40.61 |
Granted (in dollars per share) | 119.83 | 208.84 | 54.19 |
Vested (in dollars per share) | 110.53 | 59.80 | 35.36 |
Forfeited/Canceled (in dollars per share) | 154.06 | 108.22 | 43.27 |
Unvested at period end (in dollars per share) | $ 128.37 | $ 137.87 | $ 50.28 |
Stock-based Compensation - Allo
Stock-based Compensation - Allocated Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 230,888 | $ 139,910 | $ 65,114 |
Cost of revenue | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 23,283 | 13,085 | 7,731 |
Marketing | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 19,571 | 11,339 | 5,184 |
Product development | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | 124,559 | 58,900 | 33,030 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 63,475 | $ 56,586 | $ 19,169 |