Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 20, 2020 | Jun. 28, 2019 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-37806 | ||
Entity Registrant Name | TWILIO INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 26-2574840 | ||
Entity Address, Address Line One | 101 Spear Street | ||
Entity Address, Address Line Two | First Floor | ||
Entity Address, City or Town | San Francisco | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94105 | ||
City Area Code | 415 | ||
Local Phone Number | 390-2337 | ||
Title of 12(b) Security | Class A Common Stock, par value $0.001 per share | ||
Trading Symbol | TWLO | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 15.9 | ||
Documents Incorporated by Reference | Portions of the registrant's definitive Proxy Statement for the 2020 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the registrant's fiscal year ended December 31, 2019 | ||
Entity Central Index Key | 0001447669 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Common Class A | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 128,303,845 | ||
Common Class B | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 11,406,940 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 253,660 | $ 487,215 |
Short-term marketable securities | 1,599,033 | 261,128 |
Accounts receivable, net | 154,067 | 97,712 |
Prepaid expenses and other current assets | 54,571 | 26,893 |
Total current assets | 2,061,331 | 872,948 |
Restricted cash | 75 | 18,119 |
Property and equipment, net | 141,256 | |
Property and equipment, net | 63,534 | |
Operating right-of-use asset | 156,741 | |
Intangible assets, net | 460,849 | 27,558 |
Goodwill | 2,296,784 | 38,165 |
Other long-term assets | 33,480 | 8,386 |
Total assets | 5,150,516 | 1,028,710 |
Current liabilities: | ||
Accounts payable | 39,099 | 18,495 |
Accrued expenses and other current liabilities | 147,681 | 96,343 |
Deferred revenue and customer deposits | 26,362 | 22,972 |
Operating lease liability, current | 27,156 | |
Finance lease liability, current | 6,924 | |
Total current liabilities | 247,222 | 137,810 |
Operating lease liability, noncurrent | 139,200 | |
Finance lease liability, noncurrent | 8,746 | |
Convertible senior notes, net | 458,190 | 434,496 |
Other long-term liabilities | 17,747 | 18,169 |
Total liabilities | 871,105 | 590,475 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity: | ||
Preferred stock | 0 | 0 |
Class A and Class B common stock | 138 | 100 |
Additional paid-in capital | 4,952,999 | 808,527 |
Accumulated other comprehensive income | 5,086 | 1,282 |
Accumulated deficit | (678,812) | (371,674) |
Total stockholders’ equity | 4,279,411 | 438,235 |
Total liabilities and stockholders’ equity | $ 5,150,516 | $ 1,028,710 |
Consolidated Balance Sheets Con
Consolidated Balance Sheets Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 | May 31, 2018 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Preferred stock, authorized (in shares) | 100,000,000 | 100,000,000 | |
Preferred stock, issued (in shares) | 0 | 0 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | |
Common Class A | |||
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 | |
Common stock, issued (in shares) | 126,882,172 | 80,769,763 | |
Common stock, outstanding (in shares) | 126,882,172 | 80,769,763 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | $ 0.001 |
Common Class B | |||
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 | |
Common stock, issued (in shares) | 11,530,627 | 19,310,465 | |
Common stock, outstanding (in shares) | 11,530,627 | 19,310,465 | |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues: | |||
Revenue | $ 1,134,468 | $ 650,067 | $ 399,020 |
Cost of revenue | 525,551 | 300,841 | 182,895 |
Gross profit | 608,917 | 349,226 | 216,125 |
Operating expenses: | |||
Research and development | 391,355 | 171,358 | 120,739 |
Sales and marketing | 369,079 | 175,555 | 100,669 |
General and administrative | 218,268 | 117,548 | 60,791 |
Total operating expenses | 978,702 | 464,461 | 282,199 |
Loss from operations | (369,785) | (115,235) | (66,074) |
Other income (expense), net | 7,569 | (5,923) | 3,071 |
Loss before provision for income taxes | (362,216) | (121,158) | (63,003) |
Income tax benefit (provision) | 55,153 | (791) | (705) |
Net loss attributable to common stockholders | $ (307,063) | $ (121,949) | $ (63,708) |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (2.36) | $ (1.26) | $ (0.70) |
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares) | 130,083,046 | 97,130,339 | 91,224,607 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (307,063) | $ (121,949) | $ (63,708) |
Other comprehensive income (loss): | |||
Unrealized gain (loss) on marketable securities, net of tax | 3,804 | 258 | (598) |
Foreign currency translation | 0 | (1,001) | 2,623 |
Total other comprehensive income (loss), net of tax | 3,804 | (743) | 2,025 |
Comprehensive loss attributable to common stockholders | $ (303,259) | $ (122,692) | $ (61,683) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders Equity - USD ($) $ in Thousands | Total | Common Class A | Common Class B | Common StockCommon Class A | Common StockCommon Class B | Additional Paid In Capital | Accumulated Other Comprehensive Income | Accumulated Deficit | Follow-on Public Offering | Follow-on Public OfferingCommon StockCommon Class A | Follow-on Public OfferingAdditional Paid In Capital |
Balance (in shares) at Dec. 31, 2016 | 49,996,410 | 37,252,138 | |||||||||
Balance at Dec. 31, 2016 | $ 329,447 | $ 51 | $ 36 | $ 516,090 | $ 0 | $ (186,730) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net loss | (63,708) | (63,708) | |||||||||
Exercises of vested stock options (in shares) | 0 | 5,186,539 | |||||||||
Exercises of vested stock options | 25,597 | $ 0 | $ 6 | 25,591 | |||||||
Vesting of early exercised stock options | 378 | 378 | |||||||||
Vesting of restricted stock units (in shares) | 360,116 | 351,255 | |||||||||
Vesting of restricted stock units | 0 | $ 0 | |||||||||
Value of equity awards withheld for tax liability (in shares) | (22,538) | ||||||||||
Value of equity awards withheld for tax liability | (678) | (678) | |||||||||
Exercises of unvested stock options (in shares) | 22,510 | ||||||||||
Conversion of shares of Class B common stock into shares of Class A common stock (in shares) | 18,710,499 | (18,710,499) | |||||||||
Conversion of shares of Class B common stock into shares of Class A common stock | $ 18 | $ (18) | |||||||||
Shares issued under ESPP (in shares) | 794,142 | ||||||||||
Shares issued under ESPP | 11,918 | $ 1 | 11,917 | ||||||||
Donated common stock (in shares) | 45,383 | ||||||||||
Donated common stock | 1,172 | 1,172 | |||||||||
Repurchases of unvested stock options (in shares) | (16,159) | ||||||||||
Repurchases of unvested stock options | (100) | (100) | |||||||||
Unrealized gain (loss) on marketable securities, net of tax | (598) | (598) | |||||||||
Foreign currency translation | 2,623 | 2,623 | |||||||||
Stock-based compensation | 53,795 | 53,795 | |||||||||
Balance (in shares) at Dec. 31, 2017 | 69,906,550 | 24,063,246 | |||||||||
Balance at Dec. 31, 2017 | 359,846 | $ 70 | $ 24 | 608,165 | 2,025 | (250,438) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net loss | (121,949) | (121,949) | |||||||||
Adjustment to opening retained earnings due to adoption of ASC 606 | 713 | 713 | |||||||||
Exercises of vested stock options (in shares) | 0 | 3,625,991 | |||||||||
Exercises of vested stock options | 29,736 | $ 0 | $ 4 | 29,732 | |||||||
Vesting of early exercised stock options | 36 | 36 | |||||||||
Vesting of restricted stock units (in shares) | 1,970,565 | 172,211 | |||||||||
Vesting of restricted stock units | 2 | $ 2 | |||||||||
Value of equity awards withheld for tax liability (in shares) | (25,932) | (22,044) | |||||||||
Value of equity awards withheld for tax liability | (2,654) | (2,654) | |||||||||
Exercises of unvested stock options (in shares) | 2,041 | ||||||||||
Conversion of shares of Class B common stock into shares of Class A common stock (in shares) | 8,530,980 | (8,530,980) | |||||||||
Conversion of shares of Class B common stock into shares of Class A common stock | $ 8 | $ (8) | |||||||||
Shares issued under ESPP (in shares) | 325,262 | ||||||||||
Shares issued under ESPP | 10,122 | 10,122 | |||||||||
Donated common stock (in shares) | 62,338 | ||||||||||
Donated common stock | 5,996 | 5,996 | |||||||||
Unrealized gain (loss) on marketable securities, net of tax | 258 | 258 | |||||||||
Issuance of debt conversion option | 119,435 | 119,435 | |||||||||
Debt conversion option issuance costs | (2,819) | (2,819) | |||||||||
Capped call option issuance costs | (58,465) | (58,465) | |||||||||
Foreign currency translation | (1,001) | (1,001) | |||||||||
Stock-based compensation | 98,979 | 98,979 | |||||||||
Balance (in shares) at Dec. 31, 2018 | 80,769,763 | 19,310,465 | |||||||||
Balance at Dec. 31, 2018 | 438,235 | $ 80 | $ 20 | 808,527 | 1,282 | (371,674) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Net loss | (307,063) | (307,063) | |||||||||
Exercises of vested stock options (in shares) | 1,466,813 | 2,154,053 | |||||||||
Exercises of vested stock options | 37,742 | $ 1 | $ 2 | 37,739 | |||||||
Recapitalization of a subsidiary | 0 | 75 | (75) | ||||||||
Vesting of early exercised stock options | 21 | 21 | |||||||||
Vesting of restricted stock units (in shares) | 2,775,788 | 117,331 | |||||||||
Vesting of restricted stock units | 3 | $ 2 | $ 1 | ||||||||
Value of equity awards withheld for tax liability (in shares) | (23,543) | (22,095) | |||||||||
Value of equity awards withheld for tax liability | (5,412) | (5,412) | |||||||||
Conversion of shares of Class B common stock into shares of Class A common stock (in shares) | 10,029,127 | (10,029,127) | |||||||||
Conversion of shares of Class B common stock into shares of Class A common stock | $ 9 | $ (9) | |||||||||
Shares issued under ESPP (in shares) | 244,628 | ||||||||||
Shares issued under ESPP | 19,738 | 19,738 | |||||||||
Equity awards assumed in acquisition | 182,554 | 182,554 | |||||||||
Unrealized gain (loss) on marketable securities, net of tax | 3,804 | 3,804 | |||||||||
Shares issued in acquisition (in shares) | 23,555,081 | 8,064,515 | |||||||||
Shares issued in acquisition | 2,658,898 | $ 24 | 2,658,874 | $ 980,000 | $ 8 | $ 979,992 | |||||
Costs related to the follow-on public offering | (953) | ||||||||||
Foreign currency translation | 0 | ||||||||||
Stock-based compensation | 271,844 | 271,844 | |||||||||
Balance (in shares) at Dec. 31, 2019 | 126,882,172 | 11,530,627 | |||||||||
Balance at Dec. 31, 2019 | $ 4,279,411 | $ 124 | $ 14 | $ 4,952,999 | $ 5,086 | $ (678,812) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net loss | $ (307,063) | $ (121,949) | $ (63,708) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||
Depreciation and amortization | 110,430 | 26,095 | 18,764 |
Non-cash reduction to the right-of-use asset | 23,193 | 0 | 0 |
Net amortization of investment premium and discount | (4,501) | (1,496) | 262 |
Amortization of debt discount and issuance costs | 23,696 | 14,053 | 0 |
Stock-based compensation | 264,318 | 93,273 | 49,619 |
Tax benefit related to release of valuation allowance | (55,745) | 0 | 0 |
Other adjustments | 7,676 | 12,824 | 2,018 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (51,357) | (58,234) | (15,280) |
Prepaid expenses and other current assets | (20,316) | (8,739) | 2,214 |
Other long-term assets | (18,021) | (5,305) | (1,984) |
Accounts payable | 17,255 | 6,980 | 5,433 |
Accrued expenses and other current liabilities | 46,154 | 45,120 | (3,312) |
Deferred revenue and customer deposits | 2,968 | 5,958 | 3,560 |
Operating right of use liability | (21,138) | 0 | 0 |
Long-term liabilities | (3,501) | (597) | (841) |
Net cash provided by operating activities | 14,048 | 7,983 | (3,255) |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Acquisitions, net of cash acquired | 122,749 | (30,574) | (22,621) |
Purchases of marketable securities and other investments | (2,038,422) | (279,687) | (293,186) |
Proceeds from sales and maturities of marketable securities | 697,171 | 195,497 | 115,877 |
Capitalized software development costs | (21,922) | (19,546) | (17,280) |
Purchases of long-lived assets | (45,368) | (5,109) | (9,538) |
Net cash used in investing activities | (1,285,792) | (139,419) | (226,748) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from a public offering, net of underwriting discount | 980,000 | 0 | 0 |
Payments of costs related to public offerings | (877) | 0 | (430) |
Proceeds from issuance of convertible senior notes | 0 | 550,000 | 0 |
Payment of debt issuance costs | 0 | (12,941) | 0 |
Purchase of capped call | 0 | (58,465) | 0 |
Principal payments on notes payable | (5,400) | 0 | 0 |
Principal payments on finance leases | (5,646) | 0 | 0 |
Proceeds from exercises of stock options and shares issued in ESPP | 57,480 | 39,879 | 37,645 |
Value of equity awards withheld for tax liabilities | (5,412) | (2,654) | (678) |
Repurchases of common stock | 0 | 0 | (100) |
Net cash provided by financing activities | 1,020,145 | 515,819 | 36,437 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 0 | 163 | 74 |
NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | (251,599) | 384,546 | (193,492) |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH—Beginning of period | 505,334 | 120,788 | 314,280 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH —End of period | 253,735 | 505,334 | 120,788 |
Cash paid for income taxes, net | 1,368 | 564 | 605 |
Cash paid for interest | 2,290 | 741 | 0 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||
Finance lease right-of-use assets assumed in a business combination | 14,173 | 0 | 0 |
Purchases of property and equipment through finance leases | 5,848 | 2,478 | 0 |
Acquisition holdback | 7,980 | 2,290 | 0 |
Value of common stock issued and stock awards assumed in acquisition | 2,841,452 | 0 | 0 |
Stock-based compensation capitalized in software development costs | $ 7,777 | $ 5,706 | $ 4,176 |
Organization and Description of
Organization and Description of Business | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Twilio Inc. (the “Company”) was incorporated in the state of Delaware on March 13, 2008. The Company is the leader in the Cloud Communications Platform category and enables developers to build, scale and operate real-time communications within their software applications via simple-to-use Application Programming Interfaces (“API”). The power, flexibility, and reliability offered by the Company’s software building blocks empower entities of virtually every shape and size to build world-class engagement into their customer experience. The Company’s headquarters are located in San Francisco, California, and the Company has subsidiaries in Australia, Bermuda, Brazil, Colombia, Czech Republic, Estonia, France, Germany, Hong Kong, Ireland, India, Japan, the Netherlands, Singapore, Spain, Sweden, United Kingdom and the United States. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies (a) Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). (b) Principles of Consolidation The consolidated financial statements include the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated. (c) Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are used for, but not limited to, revenue allowances and sales credit reserves; recoverability of long-lived and intangible assets; capitalization and useful life of the Company’s capitalized internal-use software development costs; fair value of acquired intangible assets and goodwill; accruals and contingencies. Estimates are based on historical experience and on various assumptions that the Company believes are reasonable under current circumstances. However, future events are subject to change and best estimates and judgments may require further adjustments, therefore, actual results could differ materially from those estimates. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. (d) Concentration of Credit Risk Financial instruments that potentially expose the Company to a concentration of credit risk consist primarily of cash, cash equivalents, marketable securities and accounts receivable. The Company maintains cash, cash equivalents and marketable securities with financial institutions that management believes are financially sound and have minimal credit risk exposure although the balances will exceed insured limits. The Company sells its services to a wide variety of customers. If the financial condition or results of operations of any significant customers deteriorate substantially, operating results could be adversely affected. To reduce credit risk, management performs credit evaluations of the financial condition of significant customers. The Company does not require collateral from its credit customers and maintains reserves for estimated credit losses on customer accounts when considered necessary. Actual credit losses may differ from the Company’s estimates. During the years ended December 31, 2019 , 2018 and 2017 , no customer organization accounted for more than 10% of the Company’s total revenue. As of December 31, 2019 and 2018 , no customer organization represented more than 10% of the Company’s gross accounts receivable. (e) Revenue Recognition Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Revenue is recognized net of allowances for credits and any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company determines revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when, or as, the Company satisfies a performance obligation. Nature of Products and Services The Company's revenue is primarily derived from usage-based fees earned from customers accessing the Company's enterprise cloud computing services. Platform access is considered a monthly series comprising of one performance obligation and usage-based fees are recognized as revenue in the period in which the usage occurs. In the years ended December 31, 2019 , 2018 and 2017 , the revenue from usage-based fees represented 75% , 84% and 83% of total revenue, respectively. Subscription-based fees are derived from certain non-usage-based contracts, such as with the sales of short codes and customer support. Non-usage-based contracts revenue is recognized on a ratable basis over the contractual term which is generally one year or less. In the years ended December 31, 2019 , 2018 and 2017 , the revenue from non-usage-based fees represented 25% , 16% , and 17% of total revenue, respectively. The Company applied the optional exemption of not disclosing the transaction price allocated to the remaining performance obligations for its usage-based contracts and contracts with original duration of one year or less. The majority of the Company's contracts have a duration of one year or less. No significant judgments are required in determining whether products and services are considered distinct performance obligations and should be accounted for separately versus together, or to determine the stand-alone selling price ("SSP"). The Company's arrangements do not contain general rights of return. However, credits may be issued on a case-by-case basis. The contracts do not provide customers with the right to take possession of the software supporting the applications. Amounts that have been invoiced are recorded in accounts receivable and in revenue or deferred revenue depending on whether the revenue recognition criteria have been met. (f) Deferred Revenue and Customer Deposits Deferred revenue is recorded when cash payments are received in advance of future usage on non-cancelable contracts. Customer refundable prepayments are recorded as customer deposits. As of December 31, 2019 and 2018 , the Company recorded $26.4 million and $23.0 million as its deferred revenue and customer deposits, respectively. During the years ended December 31, 2019 and 2018 , the Company recognized $18.7 million and $10.6 million of revenue, respectively, that was included in the deferred revenue and customer deposits balance as of the end of the prior year. (g) Deferred Sales Commissions The Company records an asset for the incremental costs of obtaining a contract with a customer, for example, sales commissions that are earned upon execution of contracts. The Company uses the portfolio of data method to determine the estimated period of benefit of capitalized commissions which is determined to be five years . Amortization expense related to these capitalized costs related to initial contracts, upsells and renewals, is recognized on a straight line basis over the estimated period of benefit of the capitalized commissions. Total net capitalized costs as of December 31, 2019 and 2018 were $30.4 million and $9.4 million , respectively, and are included in prepaid expenses and other current and long‑term assets in the accompanying consolidated balance sheets. Amortization of these assets was $4.5 million and $1.4 million in the years ended December 31, 2019 and 2018 , respectively, and is included in sales and marketing expense in the accompanying consolidated statements of operations. (h) Cost of Revenue Cost of revenue consists primarily of costs of communications services purchased from network service providers. Cost of revenue also includes fees to support the Company's cloud infrastructure, direct costs of personnel, such as salaries and stock-based compensation for the customer care and support services employees, and non-personnel costs, such as amortization of capitalized internal-use software development costs and amortization of acquired intangibles. (i) Research and Development Expense Research and development expenses consist primarily of personnel costs, cloud infrastructure fees for staging and development, outsourced engineering services, amortization of capitalized internal-use software development costs and an allocation of general overhead expenses. The Company capitalizes the portion of its software development costs that meets the criteria for capitalization. (j) Internal-Use Software Development Costs Certain costs of platform and other software applications developed for internal use are capitalized. The Company capitalizes qualifying internal-use software development costs that are incurred during the application development stage. Capitalization of costs begins when two criteria are met: (i) the preliminary project stage is completed and (ii) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Costs incurred for maintenance, minor upgrades and enhancements are expensed. Costs related to preliminary project activities and post-implementation operating activities are also expensed as incurred. Capitalized costs of platform and other software applications are included in property and equipment. These costs are amortized over the estimated useful life of the software on a straight-line basis over three years. Management evaluates the useful life of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. The amortization of costs related to the platform applications is included in cost of revenue, while the amortization of costs related to other software applications developed for internal use is included in operating expenses. (k) Advertising Costs Advertising costs are expensed as incurred and were $27.0 million , $10.6 million and $4.9 million in the years ended December 31, 2019 , 2018 , and 2017 , respectively. Advertising costs are included in sales and marketing expenses in the accompanying consolidated statements of operations. (l) Stock-Based Compensation All stock-based compensation to employees, including the purchase rights issued under the Company's 2016 Employee Stock Purchase Plan (the "ESPP"), is measured on the grant date based on the fair value of the awards on the date of grant. This cost is recognized as an expense following straight-line attribution method over the requisite service period. The Company uses the Black-Scholes option pricing model to measure the fair value of its stock options and the purchase rights issued under the ESPP. The fair value of the restricted stock units is determined using the fair value of the Company's Class A common stock on the date of grant and recognized as an expense following straight-line attribution method over the requisite service period. Prior to adoption of ASU 2016-09, the stock-based compensation was recorded net of estimated forfeitures. Compensation expense for stock options granted to nonemployees is calculated using the Black-Scholes option pricing model and is recognized in expense over the service period. The Black-Scholes option pricing model requires the use of complex assumptions, which determine the fair value of stock-based awards. These assumptions include: • Fair value of the common stock. The Company uses the market closing price of its Class A common stock, as reported on the New York Stock Exchange, for the fair value. • Expected term. The expected term represents the period that the stock-based awards are expected to be outstanding. The Company uses the simplified calculation of expected term, as the Company does not have sufficient historical data to use any other method to estimate expected term; • Expected volatility. The expected volatility is derived from an average of the historical volatilities of the common stock of the Company and several other entities with characteristics similar to those of the Company, such as the size and operational and economic similarities to the Company's principal business operations; • Risk -free interest rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal to the expected term of the stock-based awards; and • Expected dividend. The expected dividend is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock. If any of the assumptions used in the Black-Scholes model changes, stock-based compensation for future options may differ materially compared to that associated with previous grants. (m) Income Taxes The Company accounts for income taxes in accordance with authoritative guidance which requires the use of the asset and liability approach. Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as net operating loss and tax credit carry-forwards. Deferred tax amounts are determined by using the enacted tax rates expected to be in effect when the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance reduces the deferred tax assets to the amount that is more likely than not to be realized. The Company recognizes the effect of uncertain income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to uncertain tax positions in the provision for income taxes in the consolidated statements of operations. (n) Foreign Currency Translation The functional currency of the Company's foreign subsidiaries is generally the U.S. dollar. Accordingly, the subsidiaries remeasure monetary assets and liabilities at period-end exchange rates, while non-monetary items are remeasured at historical rates. Revenue and expense accounts are remeasured at the average exchange rate in effect during the year. Remeasurement adjustments are recognized in the consolidated statements of operations as other income or expense in the year of occurrence. Foreign currency transaction gains and losses were insignificant for all periods presented. For those entities where the functional currency is a foreign currency, adjustments resulting from translating the financial statements into U.S. dollars are recorded as a component of accumulated other comprehensive income (loss) in stockholders' equity. Monetary assets and liabilities denominated in a foreign currency are translated into US dollars at the exchange rate on the balance sheet date. Revenue and expenses are translated at the weighted average exchange rates during the period. Equity transactions are translated using historical exchange rates. Foreign currency transaction gains and losses are included in other income (expense), net in the consolidated statements of operations. (o) Comprehensive Income (Loss) Comprehensive income (loss) refers to net income (loss) and other revenue, expenses, gains and losses that, under generally accepted accounting principles, are recorded as an element of stockholders' equity but are excluded from the calculation of net income (loss). (p) Net Loss Per Share Attributable to Common Stockholders The Company calculates its basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. All series of convertible preferred stock are considered to be participating securities as the holders of the preferred stock are entitled to receive a non-cumulative dividend on a pro rata pari passu basis in the event that a dividend is declared or paid on common stock. Shares of common stock issued upon early exercise of stock options that are subject to repurchase are also considered to be participating securities, because holders of such shares have non-forfeitable dividend rights in the event a dividend is declared or paid on common stock. Under the two-class method, in periods when the Company has net income, net income attributable to common stockholders is determined by allocating undistributed earnings, calculated as net income less current period convertible preferred stock non-cumulative dividends, between common stock and the convertible preferred stock. In computing diluted net income attributable to common stockholders, undistributed earnings are re-allocated to reflect the potential impact of dilutive securities. The Company's basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. The dilutive effect of these potential common shares is reflected in diluted earnings per share by application of the treasury stock method. For purposes of this calculation, convertible preferred stock, options to purchase common stock, unvested restricted stock units, common stock issued subject to future vesting, any shares of stock committed under the ESPP, any shares of stock held in escrow and any shares of stock reserved for future donations are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is antidilutive. Class A and Class B common stock are the only outstanding equity of the Company. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to 10 votes per share. Shares of Class B common stock may be converted into Class A common stock at any time at the option of the stockholder on a one -for-one basis, and are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Shares of Class A common stock are not convertible. (q) Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash equivalents consist of cash deposited into money market funds and reverse repurchase agreements. All credit and debit card transactions that process as of the last day of each month and settle within the first few days of the subsequent month are also classified as cash and cash equivalents as of the end of the month in which they were processed. (r) Restricted Cash Restricted cash consists of cash deposited into a savings account with a financial institution as collateral for the Company's obligations under certain vendor and facility leases contracts. (s) Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded net of the allowance for doubtful accounts. The allowance for doubtful accounts is estimated based on the Company's assessment of its ability to collect on customer accounts receivable. The Company regularly reviews the allowance by considering certain factors such as historical experience, credit quality, age of accounts receivable balances and other known conditions that may affect a customer's ability to pay. In cases where the Company is aware of circumstances that may impair a specific customer's ability to meet their financial obligations, a specific allowance is recorded against amounts due from the customer which reduces the net recognized receivable to the amount the Company reasonably believe will be collected. The Company writes-off accounts receivable against the allowance when a determination is made that the balance is uncollectible and collection of the receivable is no longer being actively pursued. The allowance for doubtful accounts was $6.3 million and $4.9 million as of December 31, 2019 and 2018 , respectively. (t) Costs Related to Public Offerings Costs related to the public offerings, which consist of direct incremental legal, printing and accounting fees, are deferred until the offering is completed. Upon completion of the offering, these costs are offset against the offering proceeds within the consolidated statements of stockholders' equity. In the year ended December 31, 2019 , the Company recorded in its consolidated statement of stockholders' equity $1.0 million in total offering costs. (u) Property and Equipment Property and equipment, both owned and under finance leases, is stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful life of the related asset. Maintenance and repairs are charged to expenses as incurred. The useful lives of property and equipment are as follows: Capitalized internal-use software development costs 3 years Data center equipment 2 - 4 years Office equipment 3 years Furniture and fixtures 5 years Software 3 years Assets under financing lease 5 years or remaining lease term Leasehold improvements 5 years or remaining lease term (v) Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02, "Leases (Topic 842)" , which was further clarified in July 2018 by ASU 2018‑10, “ Codification Improvements to Topic 842, Leases” , and ASU 2018‑11, “ Leases-Targeted Improvements” . ASU 2018-10 provides narrow amendments to clarify how to apply certain aspects of the new lease standard. ASU 2018-11 addresses implementation issues related to the new lease standard. The standard became effective for the Company on January 1, 2019. Under this standard, lessees are required to recognize in the balance sheet the right-of-use ("ROU") assets and lease liabilities that arise from operating leases. The Company adopted the standard using the optional alternative method on a prospective basis with an effective date as of the beginning of the Company’s fiscal year, January 1, 2019, and applied it to the operating leases that existed on that date. Prior year comparative financial information was not recast under the new standard and continues to be presented under ASC 840. The Company elected to utilize the package of practical expedients available for expired or existing contracts which allowed the Company to carryforward historical assessments of (a) whether contracts are or contain leases, (b) lease classification, and (c) initial direct costs. The Company elected the use of hindsight practical expedient in determining the lease term and assessing the likelihood that lease renewal, termination or purchase option will be exercised. The Company also elected to apply the short-term lease exception for all leases. Under the short-term lease exception, the Company will not recognize ROU assets or lease liabilities for leases that, at the acquisition date, have a remaining lease term of 12 months or less. As a result of implementing this guidance, the Company recognized a $123.5 million net operating ROU asset and a $132.0 million operating lease liability in its consolidated balance sheet as of January 1, 2019. The ROU asset was presented net of deferred rent of $9.0 million as of January 1, 2019, in the accompanying consolidated balance sheet. In addition, on February 1, 2019, the Company acquired through its business combination with SendGrid approximately $33.7 million in operating ROU assets, $32.6 million in operating lease liability, $14.2 million in finance ROU assets and $13.6 million in finance lease liability. The Company measured the lease liability at the present value of the future lease payments as of January 1, 2019. The Company used its incremental borrowing rate to discount the lease payments. The Company derived the discount rate, adjusted for differences in the term and payment patterns, from the information available at the adoption date. The right-of-use asset is valued at the amount of the lease liability adjusted for the remaining December 31, 2018, balance of unamortized lease incentives, prepaid rent and deferred rent. The lease liability is subsequently measured at the present value of unpaid future lease payments as of the reporting date with a corresponding adjustment to the right-of-use asset. Absent a lease modification, the Company will continue to utilize the January 1, 2019, incremental borrowing rate. The Company recognizes operating lease costs on a straight-line basis and presents these costs as operating expenses within the consolidated statements of operations and comprehensive loss. Within the consolidated statements of cash flows the Company presents the lease payments made on the operating leases within the cash flows from operations and principal payments made on the finance leases as part of financing activities. The financial results for the year ended December 31, 2019 , are presented under the new standard, while the comparative periods presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. See Note 5 , “Right-of-use Assets and Lease Liabilities” for further information. (w) Intangible Assets Intangible assets recorded by the Company are costs directly associated with securing legal registration of patents and trademarks, acquiring domain names and the fair value of identifiable intangible assets acquired in business combinations. Intangible assets with determinable economic lives are carried at cost, less accumulated amortization. Amortization is computed over the estimated useful life of each asset on a straight-line basis. The Company determines the useful lives of identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, the Company's long-term strategy for using the asset, any laws or other local regulations which could impact the useful life of the asset and other economic factors, including competition and specific market conditions. Intangible assets without determinable economic lives are carried at cost, not amortized and reviewed for impairment at least annually. The useful lives of the intangible assets are as follows: Developed technology 3 - 7 years Customer relationships 2 - 8 years Supplier relationships 2 - 5 years Trade names 5 years Patents 20 years Telecommunication licenses Indefinite Trademarks Indefinite Domain names Indefinite (x) Goodwill Goodwill represents the excess of the aggregate purchase price over the fair value of net identifiable assets acquired in a business combination. Goodwill is not amortized and is tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company has determined that it operates as one reporting unit and has selected November 30 as the date to perform its annual impairment test. In the valuation of goodwill, management must make assumptions regarding estimated future cash flows to be derived from the Company's business. If these estimates or their related assumptions change in the future, the Company may be required to record impairment for these assets. The Company has the option to first perform a qualitative assessment to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. However, the Company may elect to bypass the qualitative assessment and proceed directly to the quantitative impairment tests. The first step of the impairment test involves comparing the fair value of the reporting unit to its net book value, including goodwill. If the net book value exceeds its fair value, the Company would perform the second step of the goodwill impairment test to determine the amount of the impairment loss. In January 2017, the FASB issued ASU 2017‑04, “Simplifying the Test for Goodwill Impairment” , which removes the second step of the goodwill impairment test that required a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value. The impairment is limited to the carrying amount of goodwill. This guidance is applied prospectively. The Company early adopted this guidance effective April 1, 2019, which did not have a material impact to its consolidated financial statements. No goodwill impairment charges have been recorded for any period presented. (y) Impairment of Long-Lived Assets The Company evaluates its long-lived assets, including property and equipment and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by a comparison of the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If such evaluation indicates that the carrying amount of the asset or the asset group is not recoverable, any impairment loss would be equal to the amount the carrying value exceeds the fair value. There was no impairment during the years ended December 31, 2019 , 2018 and 2017 . (z) Business Combinations The Company recognizes identifiable assets acquired and liabilities assumed at their acquisition date fair values. Goodwill is measured as the excess of the consideration transferred over the fair value of assets acquired and liabilities assumed on the acquisition date. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed, these estimates are inherently uncertain and subject to refinement. The authoritative guidance allows a measurement period of up to one year from the date of acquisition to make adjustments to the preliminary allocation of the purchase price. As a result, during the measurement period the Company may record adjustments to the fair values of assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent that it identifies adjustments to the preliminary purchase price allocation. Upon conclusion of the measurement period or final determination of the values of the assets acquired and liabilities assumed, whichever comes first, any subsequent adjustments will be recorded to the consolidated statement of operations. (aa) Segment Information The Company's Chief Executive Officer is the chief operating decision maker, who reviews the Company's financial information presented on a consolidated basis for purposes of allocating resources and evaluating the Company's financial performance. Accordingly, the Company has determined that it operates in a single reporting segment. (ab) Fair Value of Financial Instruments The Company applies fair value accounting for all financial instruments on a recurring basis. The Company's financial instruments, which include cash, cash equivalents, accounts receivable and accounts payable are recorded at their carrying amounts, which approximate their fair values due to their short-term nature. Restricted cash is long-term in nature and consists of cash in a savings account, hence its carrying amount approximates its fair value. Marketable securities consist of U.S. treasury securities, high credit quality corporate debt securities and reverse repurchase agreements. All marketable securities are considered to be available-for-sale and recorded at their estimated fair values. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive income (loss). In valuing these items, the Company uses inputs and assumptions that market participant |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following tables provide the financial assets measured at fair value on a recurring basis: Amortized Gross Gross Gross Fair Value Hierarchy as of Aggregate Level 1 Level 2 Level 3 Financial Assets: (In thousands) Cash and cash equivalents: Money market funds $ 153,252 $ — $ — $ — $ 153,252 $ — $ — $ 153,252 Reverse repurchase agreements 35,800 — — — — 35,800 — 35,800 Total included in cash and cash equivalents 189,052 — — — 153,252 35,800 — 189,052 Marketable securities: U.S. Treasury securities 215,847 241 (3 ) — 216,085 — — 216,085 Corporate debt securities and commercial paper 1,378,487 4,516 (55 ) — 5,000 1,377,948 — 1,382,948 Total marketable securities 1,594,334 4,757 (58 ) — 221,085 1,377,948 — 1,599,033 Strategic investments 5,500 — — — — — 5,500 5,500 Total financial assets $ 1,788,886 $ 4,757 $ (58 ) $ — $ 374,337 $ 1,413,748 $ 5,500 $ 1,793,585 Amortized Gross Gross Gross Fair Value Hierarchy as of Aggregate Level 1 Level 2 Level 3 Financial Assets: (In thousands) Cash and cash equivalents: Money market funds $ 420,234 $ — $ — $ — $ 420,234 $ — $ — $ 420,234 Reverse repurchase agreements 35,000 — — — — 35,000 — 35,000 Commercial paper 9,983 — — — — 9,983 — 9,983 Total included in cash and cash equivalents 465,217 — — — — 420,234 44,983 — 465,217 Marketable securities: U.S. Treasury securities 59,785 — (7 ) (9 ) 59,769 — — 59,769 Corporate debt securities and commercial paper 201,683 23 (123 ) (224 ) — 201,359 — 201,359 Total marketable securities 261,468 23 (130 ) (233 ) 59,769 201,359 — 261,128 Total financial assets $ 726,685 $ 23 $ (130 ) $ (233 ) $ 480,003 $ 246,342 $ — $ 726,345 As the Company views its marketable securities as available to support current operations, it has classified all available for sale securities as short-term. As of December 31, 2019 , the Company had no securities that were in unrealized loss position for over 12 months. As of December 31, 2018 , for fixed income securities that were in unrealized loss positions, the Company has determined that (i) it does not have the intent to sell any of these investments, and (ii) it is not more likely than not that it will be required to sell any of these investments before recovery of the entire amortized cost basis. In addition, as of December 31, 2019 and 2018 , the Company anticipates that it will recover the entire amortized cost basis of such fixed income securities and determined that no other-than-temporary impairments were required to be recognized during the years ended December 31, 2019 , 2018 and 2017 . Interest earned on marketable securities was $20.8 million , $3.0 million and $2.6 million in the years ended December 31, 2019 , 2018 and 2017 , respectively. The interest is recorded as other income (expense), net, in the accompanying consolidated statements of operations. The following table summarizes the contractual maturities of marketable securities: As of December 31, 2019 As of December 31, 2018 Amortized Aggregate Amortized Aggregate Financial Assets: (In thousands) Less than one year $ 859,996 $ 861,181 $ 261,468 $ 261,128 One to three years 734,338 737,852 — — Total $ 1,594,334 $ 1,599,033 $ 261,468 $ 261,128 The Company enters into reverse securities repurchase agreements, primarily for short-term investments with maturities of 90 days or less. As of December 31, 2019 and 2018 , the Company was party to reverse repurchase agreements totaling $35.8 million and $35.0 million , respectively, which were reported in cash and equivalents in the accompanying consolidated balance sheets. Under these reverse securities repurchase agreements, the Company typically lends available cash at a specified rate of interest and holds U.S. government securities as collateral during the term of the agreement. Collateral value is in excess of the amounts loaned under these agreements. In May and August 2019, the Company made strategic investments totaling $5.5 million into privately held debt securities in which the Company does not have a controlling interest or significant influence. These securities are recorded at fair value in other long-term assets in the consolidated balance sheet. The Company classifies its strategic investments as Level 3 within the fair value hierarchy based on the nature of the fair value inputs and judgment involved in the valuation process. There were no material changes to fair value of these securities during the year ended December 31, 2019 . As of December 31, 2019 and 2018 , the fair value of the 0.25% convertible senior notes due 2023 (the “Notes”), as further described in Note 9 below, was approximately $841.3 million and $743.4 million , respectively. The fair value of the Notes is determined based on the closing price on the last trading day of the reporting period and is classified as a Level 2 security within the fair value hierarchy. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment consisted of the following: As of December 31, 2019 2018 (In thousands) Capitalized internal-use software development costs $ 100,155 $ 72,647 Data center equipment (1) 22,009 — Leasehold improvements 55,886 15,293 Office equipment 25,083 13,563 Furniture and fixtures (1) 10,095 4,918 Software 9,176 1,849 Total property and equipment 222,404 108,270 Less: accumulated depreciation and amortization (81,148 ) (44,736 ) Total property and equipment, net $ 141,256 $ 63,534 _______________ (1) Data center equipment and furniture and fixtures contain assets under finance leases. See Note 5 for further detail. Depreciation and amortization expense was $37.5 million , $18.9 million and $13.1 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. The Company capitalized $29.7 million , $25.3 million and $21.5 million in internal‑use software development costs in the years ended December 31, 2019 , 2018 and 2017 , respectively, of which $7.8 million , $5.7 million and $4.2 million , respectively, was stock‑based compensation expense. Amortization of capitalized software development costs was $17.1 million , $13.0 million , and $8.4 million in the years ended December 31, 2019, 2018 and 2017, respectively. The amortization of the capitalized software development costs was allocated as follows: Year Ended December 31, 2019 2018 2017 (In thousands) Cost of revenue $ 9,546 $ 6,898 $ 4,788 Research and development 7,345 5,437 3,619 General and administrative 213 689 — Total $ 17,104 $ 13,024 $ 8,407 |
Right-of-Use Asset and Lease Li
Right-of-Use Asset and Lease Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Right-of-Use Asset and Lease Liabilities | Right-of-Use Asset and Lease Liabilities The Company determines if an arrangement is a lease at inception. The Company presents the operating leases in long-term assets and current and long-term liabilities. Finance lease assets are included in property and equipment, net, and finance lease liabilities are presented in current and long-term liabilities in the accompanying consolidated balance sheet as of December 31, 2019 . Right-of-use ("ROU") assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not generally provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company’s lease agreements may have lease and non-lease components, which the Company accounts for as a single lease component. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term and variable payments are recognized in the period they are incurred. The Company’s lease agreements do not contain any residual value guarantees. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company has entered into various operating lease agreements for data centers and office space, and various financing leases agreements for data center and office equipment and furniture. As of December 31, 2019 , the Company had 22 leased properties with remaining lease terms of 0.2 years to 9.0 years , some of which include options to extend the leases for up to 5.0 years . The components of the lease expense recorded in the consolidated statement of operations were as follows: Year Ended December 31, 2019 (In thousands) Operating lease cost $ 32,558 Finance lease cost: Amortization of assets 6,090 Interest on lease liabilities 708 Short-term lease cost 6,342 Variable lease cost 3,792 Total net lease cost $ 49,490 Supplemental balance sheet information related to leases was as follows: Leases Classification As of Assets: (In thousands) Operating lease assets Operating right-of-use asset, net of accumulated amortization (1) $ 156,741 Finance lease assets Property and equipment, net of accumulated depreciation (2) 14,770 Total leased assets $ 171,511 Liabilities: Current Operating Operating lease liability, current $ 27,156 Finance Financing lease liability, current 6,924 Noncurrent Operating Operating lease liability, noncurrent 139,200 Finance Finance lease liability, noncurrent 8,746 Total lease liabilities $ 182,026 __________ (1) Operating lease assets are recorded net of accumulated amortization of $23.2 million as of December 31, 2019 . (2) Finance lease assets are recorded net of accumulated depreciation of $6.0 million as of December 31, 2019 . Supplemental cash flow and other information related to leases was as follows: Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: (In thousands) Operating cash flows from operating leases $ 28,291 Operating cash flows from finance leases (interest) $ 687 Financing cash flows from finance leases $ 5,646 Weighted average remaining lease term (in years): Operating leases 6.1 Finance leases 3.0 Weighted average discount rate: Operating leases 5.5 % Finance leases 5.3 % Maturities of lease liabilities were as follows: As of December 31, 2019 Operating Finance Year Ended December 31, (In thousands) 2020 $ 35,997 $ 7,586 2021 34,762 4,659 2022 33,214 2,333 2023 27,859 1,581 2024 25,400 315 Thereafter 43,125 581 Total lease payments 200,357 17,055 Less: imputed interest (34,001 ) (1,385 ) Total lease obligations 166,356 15,670 Less: current obligations (27,156 ) (6,924 ) Long-term lease obligations $ 139,200 $ 8,746 As of December 31, 2019 , the Company had additional operating lease obligations totaling $54.1 million related to leases that will commence in the first and second quarters of 2020 with lease terms ranging from 3.0 years to 6.8 years . The Company had an additional finance lease obligation of $0.7 million related to a lease that will commence in the second quarter of 2020 with a lease term of 6.8 years . Disclosures related to periods prior to adoption of the New Lease Standard Rent expense was $10.3 million and $8.1 million for the years ended December 31, 2018 and 2017, respectively. Future minimum lease payment obligations under noncancelable operating and finance leases were as follows: As of December 31, 2019 Operating Financing Year Ended December 31, (In thousands) 2019 $ 24,128 $ 306 2020 29,527 512 2021 30,898 573 2022 30,492 590 2023 30,122 608 Thereafter 81,316 1,939 Total minimum lease payments $ 226,483 $ 4,528 |
Right-of-Use Asset and Lease Liabilities | Right-of-Use Asset and Lease Liabilities The Company determines if an arrangement is a lease at inception. The Company presents the operating leases in long-term assets and current and long-term liabilities. Finance lease assets are included in property and equipment, net, and finance lease liabilities are presented in current and long-term liabilities in the accompanying consolidated balance sheet as of December 31, 2019 . Right-of-use ("ROU") assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not generally provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company’s lease agreements may have lease and non-lease components, which the Company accounts for as a single lease component. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term and variable payments are recognized in the period they are incurred. The Company’s lease agreements do not contain any residual value guarantees. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company has entered into various operating lease agreements for data centers and office space, and various financing leases agreements for data center and office equipment and furniture. As of December 31, 2019 , the Company had 22 leased properties with remaining lease terms of 0.2 years to 9.0 years , some of which include options to extend the leases for up to 5.0 years . The components of the lease expense recorded in the consolidated statement of operations were as follows: Year Ended December 31, 2019 (In thousands) Operating lease cost $ 32,558 Finance lease cost: Amortization of assets 6,090 Interest on lease liabilities 708 Short-term lease cost 6,342 Variable lease cost 3,792 Total net lease cost $ 49,490 Supplemental balance sheet information related to leases was as follows: Leases Classification As of Assets: (In thousands) Operating lease assets Operating right-of-use asset, net of accumulated amortization (1) $ 156,741 Finance lease assets Property and equipment, net of accumulated depreciation (2) 14,770 Total leased assets $ 171,511 Liabilities: Current Operating Operating lease liability, current $ 27,156 Finance Financing lease liability, current 6,924 Noncurrent Operating Operating lease liability, noncurrent 139,200 Finance Finance lease liability, noncurrent 8,746 Total lease liabilities $ 182,026 __________ (1) Operating lease assets are recorded net of accumulated amortization of $23.2 million as of December 31, 2019 . (2) Finance lease assets are recorded net of accumulated depreciation of $6.0 million as of December 31, 2019 . Supplemental cash flow and other information related to leases was as follows: Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: (In thousands) Operating cash flows from operating leases $ 28,291 Operating cash flows from finance leases (interest) $ 687 Financing cash flows from finance leases $ 5,646 Weighted average remaining lease term (in years): Operating leases 6.1 Finance leases 3.0 Weighted average discount rate: Operating leases 5.5 % Finance leases 5.3 % Maturities of lease liabilities were as follows: As of December 31, 2019 Operating Finance Year Ended December 31, (In thousands) 2020 $ 35,997 $ 7,586 2021 34,762 4,659 2022 33,214 2,333 2023 27,859 1,581 2024 25,400 315 Thereafter 43,125 581 Total lease payments 200,357 17,055 Less: imputed interest (34,001 ) (1,385 ) Total lease obligations 166,356 15,670 Less: current obligations (27,156 ) (6,924 ) Long-term lease obligations $ 139,200 $ 8,746 As of December 31, 2019 , the Company had additional operating lease obligations totaling $54.1 million related to leases that will commence in the first and second quarters of 2020 with lease terms ranging from 3.0 years to 6.8 years . The Company had an additional finance lease obligation of $0.7 million related to a lease that will commence in the second quarter of 2020 with a lease term of 6.8 years . Disclosures related to periods prior to adoption of the New Lease Standard Rent expense was $10.3 million and $8.1 million for the years ended December 31, 2018 and 2017, respectively. Future minimum lease payment obligations under noncancelable operating and finance leases were as follows: As of December 31, 2019 Operating Financing Year Ended December 31, (In thousands) 2019 $ 24,128 $ 306 2020 29,527 512 2021 30,898 573 2022 30,492 590 2023 30,122 608 Thereafter 81,316 1,939 Total minimum lease payments $ 226,483 $ 4,528 |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations SendGrid, Inc. In February 2019, the Company acquired all outstanding shares of SendGrid, Inc. ("SendGrid"), the leading email API platform, by issuing 23.6 million shares of its Class A common stock with a total value of $2,658.9 million . The Company also assumed all of the outstanding stock options and restricted stock units of SendGrid as converted into stock options and restricted stock units, respectively, of the Company based on the conversion ratio provided in the Agreement and Plan of Merger and Reorganization, as amended (the "Merger Agreement"). The acquisition added additional products and services to the Company's offerings for its customers. With these additional products, the Company now offers an email API and Marketing Campaigns product leveraging the email API. The acquisition has also added new customers, new employees, technology and intellectual property assets. The acquisition was accounted for as a business combination and the total purchase price was allocated to the net tangible and intangible assets and liabilities based on their fair values on the acquisition date with the excess recorded as goodwill. Subsequent to the acquisition date of February 1, 2019, and during the measurement period that ended on December 31, 2019, the Company recorded $4.4 million of adjustments to goodwill. The adjusted purchase price of $2,841.5 million reflects the $2,658.9 million fair value of 23.6 million shares of the Company's Class A common stock transferred as consideration for all outstanding shares of SendGrid, and the $182.6 million fair value of the pre-combination services of SendGrid employees reflected in the equity awards assumed by the Company on the acquisition date. The fair value of the 23.6 million shares transferred as consideration was determined on the basis of the closing market price of the Company's Class A common stock on the acquisition date. The fair value of the equity awards was determined (a) for options, by using a Black-Scholes option pricing model with the applicable assumptions as of the acquisition date, and (b) for restricted stock units, by using the closing market price of the Company's Class A common stock on the acquisition date. The unvested stock awards assumed on the acquisition date continue to vest as the SendGrid employees continue to provide services in the post-acquisition period. The fair value of these awards is recorded as share-based compensation expense over the respective vesting period of each award. The purchase price components, as adjusted, are summarized in the following table: Total (In thousands) Fair value of Class A common stock transferred $ 2,658,898 Fair value of the pre-combination service through equity awards 182,554 Total purchase price, as adjusted $ 2,841,452 The following table presents the purchase price allocation, as adjusted, recorded in the Company's consolidated balance sheet as of December 31, 2019 . Total (In thousands) Cash and cash equivalents $ 156,783 Accounts receivable and other current assets 11,635 Property and equipment, net 38,350 Operating right-of-use asset 33,742 Intangible assets (1) 483,000 Other assets 1,664 Goodwill 2,235,193 Accounts payable and other liabilities (11,114 ) Operating lease liability (32,568 ) Finance lease liability (13,616 ) Note payable (5,387 ) Deferred tax liability (56,230 ) Total purchase price $ 2,841,452 __________________________ (1) Identifiable intangible assets are comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 294,000 7 Customer relationships 169,000 7 Trade names 20,000 5 Total intangible assets acquired $ 483,000 The Company acquired a net deferred tax liability of $56.2 million in this business combination that is included in long-term liabilities in the accompanying consolidated balance sheet. This amount was offset by a release of a valuation allowance on deferred tax assets of $47.9 million . Developed technology consists of software products and domain knowledge around email delivery developed by SendGrid, which enables the delivery of email reliably and at scale. Customer relationships consists of contracts with platform users that purchase SendGrid’s products and services that carry distinct value. Trade names represent the Company’s right to the SendGrid trade names and associated design as it existed on the acquisition closing date. Goodwill generated from this acquisition primarily represents the value that is expected from the increased scale and synergies as a result of the integration of both businesses. Goodwill is not deductible for tax purposes. The estimated fair value of the intangible assets acquired was determined by the Company and the Company considered or relied in part upon a valuation report of a third‑party expert. The Company used an income approach to estimate the fair values of the developed technology, an incremental income approach to estimate the value of the customer relationships and a relief from royalty method to estimate the fair value of the trade name. Most of the net tangible assets were valued at their respective carrying amounts as of the acquisition date, as the Company believes that these amounts approximate their current fair values. The leases acquired were recorded at their respective fair values as of the acquisition date. The acquired entity's results of operations were included in the Company's consolidated financial statements from the date of acquisition, February 1, 2019. For the year ended December 31, 2019 , SendGrid contributed net operating revenue of $177.1 million , which is reflected in the accompanying consolidated statement of operations. Due to the integrated nature of the Company's operations, the Company believes that it is not practicable to separately identify earnings of SendGrid on a stand- alone basis. During the year ended December 31, 2019 , the Company incurred costs related to this acquisition of $13.9 million that were expensed as incurred and recorded in general and administrative expenses in the accompanying consolidated statement of operations. The following unaudited pro forma condensed combined financial information gives effect to the acquisition of SendGrid as if it was consummated on January 1, 2018 (the beginning of the comparable prior reporting period), and includes pro forma adjustments related to the amortization of acquired intangible assets, share-based compensation expense and direct and incremental transaction costs reflected in the historical financial statements. Specifically, the following adjustments were made: • For the year ended December 31, 2019 , the Company's and SendGrid's direct and incremental transaction costs of $40.8 million are excluded from pro forma combined net loss. • For the year ended December 31, 2018 , the Company's direct and incremental transaction costs of $13.9 million are included in the pro forma combined net loss. • In the year ended December 31, 2019 , the pro forma combined net loss includes a reversal of the valuation allowance release of $48.0 million . • In the year ended December 31, 2018 , the pro forma condensed combined net loss includes a one-time tax benefit of $53.5 million that would have resulted from the acquisition, and an ongoing tax benefit of $29.4 million . This unaudited data is presented for informational purposes only and is not intended to represent or be indicative of the results of operations that would have been reported had the acquisition occurred on January 1, 2018. It should not be taken as representative of future results of operations of the combined company. The following table presents the pro forma condensed combined financial information: Year Ended December 31, 2019 2018 (Unaudited, in thousands) Revenue $ 1,148,214 $ 796,607 Net loss attributable to common stockholders $ (322,030 ) $ (211,705 ) Other Fiscal 2019 Acquisitions In fiscal 2019 the Company acquired several businesses for a total purchase price of $43.2 million paid in cash, of which $9.1 million was withheld for the period of 18 to 36 months, and $12.8 million of deferred equity consideration, which is recorded in the post-acquisition period as the services are provided. The Company does not consider these acquisition to be material, individually or in aggregate. Total purchase price was allocated to the tangible and intangibles assets acquired and liabilities assumed based on preliminary calculations as the Company continues to gather information necessary to finalize the valuations. These preliminary values may change in the future reporting periods until the valuations are finalized, which will occur in the second and fourth quarters of 2020. Goodwill of $23.4 million was recorded to reflect the excess purchase price over the net assets acquired and represents the value that the Company expects to realize from expanding its product offerings and other synergies. Goodwill that is expected to be deductible for tax purposes is $6.8 million . The following table summarizes the preliminary purchase price allocation in aggregate for the other business acquired in fiscal 2019 recorded in the Company's consolidated balance sheet as of December 31, 2019 : Total (In thousands) Net liabilities $ (3,219 ) Intangible assets (1) 22,986 Goodwill 23,425 Total preliminary purchase price $ 43,192 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 11,771 4 - 6 Customer relationships 5,185 3 - 5 Telecommunication licenses 4,370 Indefinite Supplier relationships 1,660 2 Total intangible assets acquired $ 22,986 During the year ended December 31, 2019 , the Company incurred $1.9 million of costs related to this acquisition that were expensed as incurred and recorded in general and administrative expenses in the accompanying consolidated statement of operation. Pro forma results of operations for these acquisitions are not presented as the financial impact to the Company's consolidated financial statements is immaterial. Fiscal 2018 Acquisitions Ytica.com a.s. In September 2018, the Company acquired all outstanding shares of Ytica.com a.s. ("Ytica"), a developer and provider of a contact center reporting and analytics based in the Czech Republic, for a total purchase price of $21.8 million , paid in cash, of which $3.2 million was held in escrow with a term of 18 months . Additionally, the Company granted 47,574 restricted stock units of the Company's Class A common stock to a former shareholder of Ytica that had a value of $3.6 million and is subject to vesting over a period of three years. The Company is recording stock-based compensation expense as the shares are vesting. The acquisition was accounted for as a business combination and the total purchase price was allocated to the net tangible and intangible assets and liabilities based on their fair values on the acquisition date and the excess was recorded as goodwill. The acquired entity's results of operations have been included in the consolidated financial statements of the Company from the date of acquisition. The following table presents the purchase price allocation recorded in the Company's consolidated balance sheet as of December 31, 2018: Total (In thousands) Net liabilities $ (1,538 ) Intangible assets (1) 9,920 Goodwill (2) 13,375 Total purchase price $ 21,757 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 9,090 4 Customer relationships 830 2 Total intangible assets acquired $ 9,920 (2) The goodwill is primarily attributable to the future cash flows to be realized from the acquired technology platform as well as operational synergies. The Company has filed for the elections that make the goodwill deductible for U.S. tax purposes. The Company acquired a net deferred tax liability of $1.7 million in this business combination. The estimated fair value of the intangible assets acquired was determined by the Company, and the Company considered or relied in part upon a valuation report of a third-party expert. The Company used an income approach to estimate the fair values of the identifiable intangible assets. The Company incurred costs related to this acquisition of $0.6 million that were expensed as incurred and recorded in general and administrative expenses in the accompanying consolidated statement of operation. Pro forma results of operations for this acquisition are not presented as the financial impact to the Company's consolidated financial statements is immaterial. Core Network Dynamics GmbH In August 2018, the Company acquired all outstanding shares of Core Network Dynamics GmbH ("CND"), a developer and provider of a complete software mobile network infrastructure based in Germany, for a total purchase price of $11.1 million , paid in cash, of which $2.0 million was withheld by the Company for a term of 18 months . Additionally, the Company granted 35,950 restricted stock units of the Company's Class A common stock to a former shareholder of CND that had a value of $2.2 million and is subject to vesting over a period of three years . The Company is recording a stock-based compensation expense as the shares are vesting. The acquisition was accounted for as a business combination and the total purchase price was allocated to the net tangible and intangible assets and liabilities based on their fair values on the acquisition date and the excess was recorded as goodwill. The acquired entity's results of operations have been included in the consolidated financial statements of the Company from the date of acquisition. The following table presents the purchase price allocation recorded in the Company's consolidated balance sheet as of December 31, 2018: Total (In thousands) Net liabilities $ (313 ) Intangible assets (1) 4,500 Goodwill (2) 6,869 Total purchase price $ 11,056 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 3,910 4 Customer relationships 590 0.5 Total intangible assets acquired $ 4,500 (2) The goodwill is primarily attributable to the future cash flows to be realized from the operating synergies between the acquired technology platform and the Company's Programmable Wireless products. The Company has filed for the elections that make the goodwill deductible for U.S. tax purposes. The Company acquired a net deferred tax liability of $1.2 million in this business combination. The estimated fair value of the intangible assets acquired was determined by the Company, and the Company considered or relied in part upon a valuation report of a third-party expert. The Company used a replacement cost approach to estimate the fair values of the identifiable intangible assets. The Company incurred costs related to this acquisition of $0.8 million that were expensed as incurred and have been recorded in general and administrative expenses in the accompanying consolidated statement of operation. Pro forma results of operations for this acquisition are not presented as the financial impact to the Company's consolidated financial statements is immaterial. Fiscal 2017 Acquisitions Beepsend, AB In February 2017, the Company completed its acquisition of Beepsend AB, a messaging provider based in Sweden, specializing in messaging and SMS solutions, for a total purchase price of $23.0 million , paid in cash, of which $5.0 million was held in escrow with a term of 18 months and was fully released at the escrow expiration date. The acquisition was accounted for as a business combination and the total purchase price was allocated to the net tangible and intangible assets and liabilities based on their fair values on the acquisition date. The acquired entity's results of operations were included in the consolidated financial statements of the Company from the date of acquisition. The following table presents the purchase price allocation recorded in the Company's consolidated balance sheet: Total (In thousands) Net liabilities $ (3,575 ) Intangible assets (1) 13,700 Goodwill (2) 12,837 Total purchase price $ 22,962 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 5,000 4 Customer relationships 6,100 7 - 8 Supplier relationships 2,600 5 Total intangible assets acquired $ 13,700 (2) Goodwill represents the excess of purchase price over the fair value of identifiable tangible and intangible assets acquired and liabilities assumed. The goodwill in this transaction was primarily attributable to the future cash flows to be realized from the acquired technology platform, existing customer and supplier relationships as well as operational synergies. Goodwill is deductible for tax purposes. The Company acquired a net deferred tax liability of $2.6 million in this business combination. The estimated fair value of the intangible assets acquired was determined by the Company, and the Company considered or relied in part upon a valuation report of a third-party expert. The Company used income approaches to estimate the fair values of the identifiable intangible assets. Specifically, the developed technology asset class was valued using the-relief-from royalty method, while the customer relationships asset class was valued using a multi-period excess earnings method and the supplier relationships asset class was valued using an incremental cash flow method. The Company incurred costs related to this acquisition of $0.7 million , of which $0.3 million was incurred during the year ended December 31, 2017. All acquisition related costs were expensed as incurred and have been recorded in general and administrative expenses in the accompanying consolidated statements of operations. Pro forma results of operations for this acquisition are not presented as the financial impact to the Company's consolidated financial statements is immaterial. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill Goodwill balance as of December 31, 2019 and 2018 , was as follows: Total (In thousands) Balance as of December 31, 2017 $ 17,851 Goodwill additions related to 2018 acquisitions 20,356 Measurement period adjustments 571 Effect of exchange rate (613 ) Balance as of December 31, 2018 $ 38,165 Goodwill additions related to 2019 acquisitions 2,262,622 Measurement period adjustments (4,003 ) Balance as of December 31, 2019 $ 2,296,784 Intangible assets Intangible assets consisted of the following: As of Gross Accumulated Net Amortizable intangible assets: (In thousands) Developed technology $ 333,980 $ (55,390 ) $ 278,590 Customer relationships 182,339 (26,347 ) 155,992 Supplier relationships 4,356 (1,532 ) 2,824 Trade names 20,060 (3,727 ) 16,333 Patent 2,707 (262 ) 2,445 Total amortizable intangible assets 543,442 (87,258 ) 456,184 Non-amortizable intangible assets: Telecommunication licenses 4,370 — 4,370 Domain names 32 — 32 Trademarks and other 263 — 263 Total $ 548,107 $ (87,258 ) $ 460,849 As of Gross Accumulated Net Amortizable intangible assets: (In thousands) Developed technology $ 28,209 $ (10,497 ) $ 17,712 Customer relationships 8,153 (2,411 ) 5,742 Supplier relationships 2,696 (973 ) 1,723 Trade name 60 (60 ) — Patent 2,264 (178 ) 2,086 Total amortizable intangible assets 41,382 (14,119 ) 27,263 Non-amortizable intangible assets: Domain names 32 — 32 Trademarks 263 — 263 Total $ 41,677 $ (14,119 ) $ 27,558 Amortization expense was $72.9 million , $7.2 million and $5.7 million for the years ended December 31, 2019, 2018 and 2017, respectively, Total estimated future amortization expense is as follows: As of Year Ended December 31, (In thousands) 2020 $ 81,419 2021 79,785 2022 77,170 2023 73,888 2024 68,359 Thereafter 75,563 Total $ 456,184 |
Accrued Expenses and Other Liab
Accrued Expenses and Other Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
Accrued Expenses and Other Liabilities | Accrued Expenses and Other Liabilities Accrued expenses and other current liabilities consisted of the following: As of December 31, 2019 2018 (In thousands) Accrued payroll and related $ 20,462 $ 9,886 Accrued bonus and commission 12,898 8,564 Accrued cost of revenue 47,563 29,901 Sales and other taxes payable 28,592 23,631 ESPP contributions 4,023 2,672 Deferred rent — 1,418 VAT and other taxes 4,838 2,217 Acquisition holdback 6,520 — Accrued other expense 22,785 18,054 Total accrued expenses and other current liabilities $ 147,681 $ 96,343 Other long-term liabilities consisted of the following: As of December 31, 2019 2018 (In thousands) Deferred rent $ — $ 7,569 Deferred tax liability 7,535 5,181 Acquisition holdback 3,750 2,290 Capital lease obligation — 2,170 Accrued other expenses 6,462 959 Total other long-term liabilities $ 17,747 $ 18,169 |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2019 | |
Long-term Debt, Unclassified [Abstract] | |
Notes Payable | Notes Payable Convertible Senior Notes and Capped Call Transactions In May 2018, the Company issued $550.0 million aggregate principal amount of 0.25% convertible senior notes due 2023 in a private placement, including $75.0 million aggregate principal amount of such Notes pursuant to the exercise in full of the over-allotment options of the initial purchasers (collectively, the “Notes”). The interest on the Notes is payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2018. The Notes may bear special interest under specified circumstances relating to the Company’s failure to comply with its reporting obligations under the indenture relating to the issuance of Notes (the “indenture”) or if the Notes are not freely tradeable as required by the indenture. The Notes will mature on June 1, 2023, unless earlier repurchased or redeemed by the Company or converted pursuant to their terms. The total net proceeds from the debt offering, after deducting initial purchaser discounts and debt issuance costs, paid or payable by us, were approximately $537.0 million . Each $1,000 principal amount of the Notes is initially convertible into 14.104 shares of the Company’s Class A common stock par value $0.001 , which is equivalent to an initial conversion price of approximately $70.90 per share. The conversion rate is subject to adjustment upon the occurrence of certain specified events but will not be adjusted for any accrued and unpaid special interest. In addition, upon the occurrence of a make-whole fundamental change, as defined in the indenture, the Company will, in certain circumstances, increase the conversion rate by a number of additional shares for a holder that elects to convert its Notes in connection with such make-whole fundamental change or during the relevant redemption period. Prior to the close of business on the business day immediately preceding March 1, 2023, the Notes may be convertible at the option of the holders only under the following circumstances: (1) during any calendar quarter commencing after September 30, 2018, and only during such calendar quarter, if the last reported sale price of the Class A common stock for at least 20 trading days (whether or not consecutive) in a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is more than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business days period after any five consecutive trading day period in which, for each trading day of that period, the trading price per $1,000 principal amount of Notes for such trading day was less than 98% of the product of the last reported sale price of the Class A common stock and the conversion rate on each such trading day; (3) upon the Company’s notice that it is redeeming any or all of the Notes; or (4) upon the occurrence of specified corporate events. On or after March 1, 2023, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders of the Notes may, at their option, convert all or a portion of their Notes regardless of the foregoing conditions. Upon conversion, the Company will pay or deliver, as the case may be, cash, shares of Class A common stock, or a combination of cash and shares of Class A common stock, at the Company’s election. It is the Company’s current intent to settle the principal amount of the Notes with cash. During the year ended December 31, 2019 , the conditional conversion feature of the Notes was triggered as the last reported sale price of the Company's Class A common stock was more than or equal to 130% of the conversion price for at least 20 trading days (whether or not consecutive) in the period of 30 consecutive trading days ending on December 31, 2019 (the last trading day of the calendar quarter), and therefore the Notes are currently convertible, in whole or in part, at the option of the holders between January 1, 2020 through March 31, 2020. Whether the Notes will be convertible following such period will depend on the continued satisfaction of this condition or another conversion condition in the future. The Company continues to classify the Notes as a long-term liability in its consolidated balance sheet as of December 31, 2019, based on contractual settlement provisions. The Company may redeem the Notes, in whole or in part, at its option, on or after June 1, 2021 but before the 35th scheduled trading day before the maturity date, at a cash redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, if the last reported sale price of the Class A common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading days ending on, and including, the trading day immediately before the date the redemption notices were sent; and the trading day immediately before such notices were sent. No sinking fund is provided for the Notes. Upon the occurrence of a fundamental change (as defined in the indenture) prior to the maturity date, holders may require the Company to repurchase all or a portion of the Notes for cash at a price equal to 100% of the principal amount of the Notes to be repurchased, plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date. The Notes are senior unsecured obligations and will rank senior in right of payment to any of the Company’s indebtedness that is expressly subordinated in right of payment to the Notes; equal in right of payment with the Company’s existing and future liabilities that are not so subordinated; effectively subordinated to any of the Company’s secured indebtedness to the extent of the value of the assets securing such indebtedness; and structurally junior to all indebtedness and other liabilities (including trade payables) of current or future subsidiaries of the Company. The foregoing description is qualified in its entirety by reference to the text of the indenture and the form of 0.25% convertible senior notes due 2023, which were filed as exhibits to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2018 and are incorporated herein by reference. In accounting for the issuance of the Notes, the Company separated the Notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the fair value of a similar debt instrument that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was $119.4 million and was determined by deducting the fair value of the liability component from the par value of the Notes. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. The excess of the principal amount of the liability component over its carrying amount, or the debt discount, is amortized to interest expense at an annual effective interest rate of 5.7% over the contractual terms of the Notes. In accounting for the transaction costs related to the Notes, the Company allocated the total amount incurred to the liability and equity components of the Notes based on the proportion of the proceeds allocated to the debt and equity components. Issuance costs attributable to the liability component were approximately $10.2 million , were recorded as an additional debt discount and are amortized to interest expense using the effective interest method over the contractual terms of the Notes. Issuance costs attributable to the equity component were netted with the equity component in stockholders’ equity. The net carrying amount of the liability component of the Notes was as follows: As of December 31, 2019 2018 (In thousands) Principal $ 549,999 $ 550,000 Unamortized discount (84,647 ) (106,484 ) Unamortized issuance costs (7,162 ) (9,020 ) Net carrying amount $ 458,190 $ 434,496 The net carrying amount of the equity component of the Notes was as follows: As of December 31, 2019 2018 (In thousands) Proceeds allocated to the conversion options (debt discount) $ 119,435 $ 119,435 Issuance costs (2,819 ) (2,819 ) Net carrying amount $ 116,616 $ 116,616 The following table sets forth the interest expense recognized related to the Notes: Year Ended December 31, 2019 2018 (In thousands) Contractual interest expense $ 1,375 $ 852 Amortization of debt issuance costs 1,858 1,102 Amortization of debt discount 21,838 12,951 Total interest expense related to the Notes $ 25,071 $ 14,905 In connection with the offering of the Notes, the Company entered into privately negotiated capped call transactions with certain counterparties (the “capped calls”). The capped calls each have an initial strike price of approximately $70.90 per share, subject to certain adjustments, which corresponds to the initial conversion price of the Notes. The capped calls have initial cap prices of $105.04 per share, subject to certain adjustments. The capped calls cover, subject to anti-dilution adjustments, approximately 7,757,172 shares of Class A common stock. The capped calls are generally intended to reduce or offset the potential dilution to the Class A common stock upon any conversion of the Notes with such reduction or offset, as the case may be, subject to a cap based on the cap price. The capped calls expire on the earlier of (i) the last day on which any convertible securities remain outstanding and (ii) June 1, 2023, subject to earlier exercise. The capped calls are subject to either adjustment or termination upon the occurrence of specified extraordinary events affecting the Company, including a merger event, a tender offer, and a nationalization, insolvency or delisting involving the Company. In addition, the capped calls are subject to certain specified additional disruption events that may give rise to a termination of the capped calls, including changes in law, insolvency filings, and hedging disruptions. The capped call transactions are recorded in stockholders’ equity and are not accounted for as derivatives. The net cost of $58.5 million |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Supplemental Balance Sheet Information | Supplemental Balance Sheet Information A roll‑forward of the Company’s reserves is as follows: (a) Allowance for doubtful accounts: Year Ended December 31, 2019 2018 2017 (In thousands) Balance, beginning of period $ 4,945 $ 1,033 $ 1,076 Additions 2,226 4,085 580 Write-offs (884 ) (173 ) (623 ) Balance, end of period $ 6,287 $ 4,945 $ 1,033 Percentage of revenue 1 % 1 % — % (b) Sales credit reserve: Year Ended December 31, 2019 2018 2017 (In thousands) Balance, beginning of period $ 3,015 $ 1,761 $ 544 Additions 18,143 5,560 2,531 Deductions against reserve (14,374 ) (4,306 ) (1,314 ) Balance, end of period $ 6,784 $ 3,015 $ 1,761 Percentage of revenue 1 % — % — % |
Revenue by Geographic Area
Revenue by Geographic Area | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue by Geographic Area | Revenue by Geographic Area Revenue by geographic area is based on the IP address or the mailing address at the time of registration. The following table sets forth revenue by geographic area: Year Ended December 31, 2019 2018 2017 Revenue by geographic area: (In thousands) United States $ 808,857 $ 484,809 $ 308,612 International 325,611 165,258 90,408 Total $ 1,134,468 $ 650,067 $ 399,020 Percentage of revenue by geographic area: United States 71 % 75 % 77 % International 29 % 25 % 23 % Long-lived assets outside the United States were not significant. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies (a) Lease and Other Commitments The Company entered into various non-cancelable operating lease agreements for its facilities that expire over the next 9.0 years . See Note 5 to these consolidated financial statements for additional detail on the Company's operating and finance lease commitments. Additionally, the Company has contractual commitments with its cloud infrastructure provider, network service providers and other vendors that are noncancelable and expire within one to four years . Future minimum payments under these noncancelable purchase commitments were as follows. Unrecognized tax benefits are not included in these amounts because any amounts expected to be settled in cash are not material: As of Year Ending December 31, (In thousands) 2020 $ 62,444 2021 50,813 2022 2,855 2023 3,750 2024 — Thereafter — Total payments $ 119,862 (b) Legal Matters On April 30, 2015 and March 28, 2016, Telesign Corporation (“Telesign”) filed lawsuits (which were subsequently consolidated) against the Company in the United States District Court, Central District of California (“Telesign I/II”). Telesign alleges in Telesign I/II that the Company is infringing four U.S. patents that it holds: U.S. Patent No. 7,945,034 (“034”), U.S. Patent No. 8,462,920 (“920”), U.S. Patent No. 8,687,038 (“038”) and U.S. Patent No. 9,300,792 (“792”). The consolidated Telesign I/II actions have been transferred to the United States District Court, Northern District. The patent infringement allegations in the lawsuit relate to the Company's two‑factor authentication use case , Authy, and an API tool to find information about a phone number. Telesign seeks, among other things, to enjoin the Company from allegedly infringing the patents, along with damages for lost profits and damages based on a reasonable royalty. On March 8, 2017, in response to a petition by the Company, the U.S. Patent and Trademark Officer (“PTO”) issued an order instituting an inter partes review for the ‘792 patent. On March 6, 2018, the PTO found all claims challenged by the Company in the inter partes review unpatentable. Telesign did not appeal the PTO's decision and it is final. On October 19, 2018, the district court granted the Company's motion that all remaining asserted claims of the asserted patents are invalid under 35 U.S.C. § 101 and entered judgment in the Company's favor. On November 8, 2018, Telesign appealed the judgment to the United States Court of Appeals for the Federal Circuit. On January 9, 2020, the Federal Circuit Court affirmed the district court’s judgment. Telesign has not indicated whether it will seek a further appeal of the judgment. Based on, among other things, the district court’s judgment being affirmed on appeal in the Company’s favor, the Company does not believe a loss is probable or estimable. On December 1, 2016, the Company filed a patent infringement lawsuit against Telesign in the United States District Court, Northern District of California (“Telesign III”), alleging infringement of United States Patent No. 8,306,021 (“021”), United States Patent No. 8,837,465 (“465”), United States Patent No. 8,755,376 (“376”), United States Patent No. 8,736,051 (“051”), United States Patent No. 8,737,962 (“962”), United States Patent No. 9,270,833 (“833”), and United States Patent No. 9,226,217 (“217”). Telesign filed a motion to dismiss the complaint on January 25, 2017. In two orders, issued on March 31, 2017 and April 17, 2017, the court granted Telesign’s motion to dismiss with respect to the ‘962, ‘833, ‘051 and ‘217 patents, but denied Telesign’s motion to dismiss as to the ‘021, ‘465 and ‘376 patents. On August 23, 2017, Telesign petitioned the U.S. Patent and Trademark Office (“U.S. PTO”) for inter partes review of the ‘021, ‘465, and ‘376 patents. On March 9, 2018, the PTO denied Telesign’s petition for inter partes review of the ‘021 patent and granted Telesign’s petitions for inter partes review of the ‘465 and ‘376 patents. On March 6, 2019, the PTO found all claims challenged by Telesign in the inter partes review unpatentable. The Company has appealed the decisions to the United States Court of Appeals for the Federal Circuit. Telesign III is currently stayed pending resolution of the inter partes reviews (and appeals from them) of the ‘465 and ‘376 patents. The Company is seeking a judgment of infringement, a judgment of willful infringement, monetary and injunctive relief, enhanced damages, and an award of costs and expenses against Telesign. On February 18, 2016, a putative class action complaint was filed in the Alameda County Superior Court in California, entitled Angela Flowers v. Twilio Inc. The complaint alleges that the Company’s products permit the interception, recording and disclosure of communications at a customer’s request and are in violation of the California Invasion of Privacy Act. The complaint seeks injunctive relief as well as monetary damages. On January 2, 2018, the court issued an order granting in part and denying in part the plaintiff’s class certification motion. The court certified two classes of individuals who, during specified time periods, allegedly sent or received certain communications involving the accounts of three of the Company’s customers that were recorded. Following mediation, on January 7, 2019, the parties signed a long form settlement agreement, providing for a payment of $10.0 million into a common fund and injunctive relief involving certain updates to Twilio’s Acceptable Use Policy and customer documentation. On January 15, 2019, the court entered an order granting preliminary approval of the settlement, and the parties signed an amended settlement agreement to conform to the court’s order. The court entered a final order and judgment approving the settlement on June 17, 2019. On August 30, 2019, Twilio made a payment of $1.7 million to fund the settlement. A compliance hearing has been scheduled for May 19, 2020. Any additional loss related to this matter is neither probable nor reasonably possible. On September 1, 2015, Twilio was named as a defendant in a First Amended Complaint in a putative class action captioned Jeremy Bauman v. David Saxe, et al. pending in the United States District Court, District of Nevada relating to the alleged sending of unsolicited text messages to the plaintiffs and putative class members. The Company filed a motion to dismiss, which was granted, and on September 20, 2016 the plaintiff filed a Second Amended Complaint with additional allegations that the Company violated the Telephone Consumer Protection Act (“TCPA”), and the Nevada Deceptive Trade Practices Act (“NDTPA”), NRS 41.600(2)(e). On January 10, 2019, the court granted Plaintiffs’ motion for class certification under the TCPA and denied plaintiff’s request to certify a class under the NDTPA. On February 13, 2019, the court issued an order denying the Company's motion to dismiss as to Plaintiffs’ TCPA claim and granting dismissal as to Plaintiffs’ NDTPA claim. On February 22, 2019, the court stayed the case and directed all parties to mediation, which was conducted on May 15, 2019. On May 17, 2019, the original defendants (the “Saxe Defendants”) and Twilio entered an agreement, which among other things, obligates the Saxe Defendants to fully fund all monetary and non-monetary aspects of the settlement of the matter and to obtain the dismissal of the plaintiffs’ and the class’s claims against the Company with prejudice. On October 7, 2019, the plaintiffs filed an unopposed motion for settlement and an unopposed motion to dismiss Twilio from the action without prejudice. Based on, among other things, the dismissal motion and our agreement with the Saxe Defendants, the Company does not believe a loss is reasonably possible or estimable. In addition to the litigation discussed above, from time to time, the Company may be subject to legal actions and claims in the ordinary course of business. The Company has received, and may in the future continue to receive, claims from third parties asserting, among other things, infringement of their intellectual property rights. Future litigation may be necessary to defend the Company, its partners and its customers by determining the scope, enforceability and validity of third‑party proprietary rights, or to establish our proprietary rights. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors. Legal fees and other costs related to litigation and other legal proceedings are expensed as incurred and are included in general and administrative expenses in the accompanying consolidated statements of operations. (c) Indemnification Agreements The Company has signed indemnification agreements with all of its board members and executive officers. The agreements indemnify the board members and executive officers from claims and expenses on actions brought against the individuals separately or jointly with the Company for certain indemnifiable events. Indemnifiable Events generally mean any event or occurrence related to the fact that the board member or the executive officer was or is acting in his or her capacity as a board member or an executive officer for the Company or was or is acting or representing the interests of the Company. In the ordinary course of business and in connection with our financing and business combinations transactions, the Company enters into contractual arrangements under which it agrees to provide indemnification of varying scope and terms to business partners, customers and other parties with respect to certain matters, including, but not limited to, losses arising out of the breach of such agreements, intellectual property infringement claims made by third parties and other liabilities relating to or arising from the Company’s various products, or its acts or omissions. In these circumstances, payment may be conditional on the other party making a claim pursuant to the procedures specified in the particular contract. Further, the Company’s obligations under these agreements may be limited in terms of time and/or amount, and in some instances, the Company may have recourse against third parties for certain payments. The terms of such obligations may vary. As of December 31, 2019 and 2018 , no amounts were accrued. (d) Other Taxes The Company conducts operations in many tax jurisdictions throughout the United States. In many of these jurisdictions, non-income-based taxes, such as sales and use and telecommunications taxes are assessed on the Company’s operations. Prior to March 2017, the Company had not billed nor collected these taxes from its customers and, in accordance with U.S. GAAP, recorded a provision for its tax exposure in these jurisdictions when it was both probable that a liability had been incurred and the amount of the exposure could be reasonably estimated. These estimates included several key assumptions including, but not limited to, the taxability of the Company’s services, the jurisdictions in which its management believes it had nexus, and the sourcing of revenues to those jurisdictions. Starting in March 2017, the Company began collecting these taxes from customers in various jurisdiction and since then has expanded to most jurisdictions where these taxes are now being collected. Simultaneously, the Company continues to be in discussions with certain states regarding its prior state sales and other taxes, if any, that the Company may owe. During 2017, the Company revised its estimates of its tax exposure based on settlements reached with various states indicating that certain revisions to the key assumptions were appropriate. Those revisions included, but were not limited to, the sourcing of revenue and the taxability of the Company's services. In the year ended December 31, 2017, the total impact of these changes on the net loss attributable to common stockholders was a reduction of $13.4 million . As of December 31, 2019 and 2018 , the liability recorded for these taxes was $27.0 million and $22.6 million , respectively. In the event other jurisdictions challenge management’s assumptions and analysis, the actual exposure could differ materially from the current estimates. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Preferred Stock As of December 31, 2019 and 2018, the Company had authorized 100,000,000 shares of preferred stock, par value $0.001 , of which no shares were issued and outstanding. Common Stock As of December 31, 2019 and 2018 , the Company had authorized 1,000,000,000 shares of Class A common stock and 100,000,000 shares of Class B common stock, each par value $0.001 per share. As of December 31, 2019 , 126,882,172 shares of Class A common stock and 11,530,627 shares of Class B common stock were issued and outstanding. As of December 31, 2018 , 80,769,763 shares of Class A common stock and 19,310,465 shares of Class B common stock were issued and outstanding. Holders of Class A and Class B common stock are entitled to one vote per share and 10 votes per share, respectively, and the shares of Class A common stock and Class B common stock are identical, except for voting and conversion rights. In June 2019, the Company completed a public equity offering in which the Company sold 8,064,515 shares of its Class A common stock, which included 1,051,893 shares sold pursuant to the exercise by the underwriters of an option to purchase additional shares, at a public offering price of $124.00 per share. The Company received aggregate proceeds of $979.0 million after deducting underwriting discounts and offering expenses paid and payable by the Company. The Company had reserved shares of common stock for issuance as follows: As of December 31, 2019 2018 Stock options issued and outstanding 7,705,848 7,978,369 Nonvested restricted stock units issued and outstanding 8,490,517 8,262,902 Class A common stock reserved for Twilio.org 795,673 572,676 Stock-based awards available for grant under 2016 Plan 14,957,734 9,313,354 Stock-based awards available for grant under 2016 ESPP 3,848,953 3,092,779 Class A common stock reserved for the convertible senior notes 10,472,165 10,472,165 Total 46,270,890 39,692,245 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation 2008 Stock Option Plan The Company maintained a stock plan, the 2008 Stock Option Plan, as amended and restated (the “2008 Plan”), which allowed the Company to grant incentive (“ISO”), non‑statutory (“NSO”) stock options and restricted stock units (“RSU”) to its employees, directors and consultants to participate in the Company’s future performance through stock‑based awards at the discretion of the board of directors. Under the 2008 Plan, options to purchase the Company’s common stock could not be granted at a price less than fair value in the case of ISOs and NSOs. Fair value was determined by the board of directors, in good faith, with input from valuation consultants. On June 22, 2016, the plan was terminated in connection with the Company’s IPO. Accordingly, no shares are available for future issuance under the 2008 Plan. The 2008 Plan continues to govern outstanding equity awards granted thereunder. The Company’s right of first refusal for outstanding equity awards granted under the 2008 Plan terminated upon completion of the IPO. Options granted include provisions for early exercisability. 2016 Stock Option Plan The Company’s 2016 Stock Option and Incentive Plan (the “2016 Plan”) became effective on June 21, 2016. The 2016 Plan provides for the grant of ISOs, NSOs, restricted stock, RSUs, stock appreciation rights, unrestricted stock awards, performance share awards, dividend equivalent rights and cash-based awards to employees, directors and consultants of the Company. A total of 11,500,000 shares of the Company’s Class A common stock were initially reserved for issuance under the 2016 Plan. These available shares automatically increase each January 1, beginning on January 1, 2017, by 5% of the number of shares of the Company’s Class A and Class B common stock outstanding on the immediately preceding December 31, or such lesser number of shares as determined by the Company’s compensation committee. On January 1, 2019 and 2018, the shares available for grant under the 2016 Plan were automatically increased by 5,004,011 shares and 4,698,490 shares, respectively. Under the 2016 Plan, the stock options are granted at a price per share not less than 100% of the fair market value per share of the underlying common stock on the date of grant. Under both plans, stock options generally expire 10 years from the date of grant and vest over periods determined by the board of directors. The vesting period for new-hire options and restricted stock units is generally a four year term from the date of grant, at a rate of 25% after one year , then monthly or quarterly, respectively, on a straight-line basis thereafter. In July 2017, the Company began granting restricted stock units to existing employees that vest in equal quarterly installments over a four year service period. SendGrid Equity Awards Assumed in Acquisition In connection with its acquisition of SendGrid, the Company assumed all stock options and restricted stock units issued under SendGrid’s 2009, 2012 or 2017 Stock Incentive Plans that were outstanding on the date of acquisition. The assumed equity awards will continue to be outstanding and will be governed by the provisions of their respective plans. Additionally, the Company assumed shares of SendGrid common stock that were reserved and available for issuance under SendGrid's 2017 Equity Incentive Plan, on an as converted basis. These shares can be utilized for future equity grants under the Company’s 2016 Plan, to the extent permitted by New York Stock Exchange rules. 2016 Employee Stock Purchase Plan The Company’s Employee Stock Purchase Plan (“2016 ESPP”), as amended, initially became effective on June 21, 2016. A total of 2,400,000 shares of the Company’s Class A common stock were initially reserved for issuance under the 2016 ESPP. These available shares automatically increase each January 1, beginning on January 1, 2017, by the lesser of 1,800,000 shares of the common stock, 1% of the number of shares of the Company’s Class A and Class B common stock outstanding on the immediately preceding December 31 or such lesser number of shares as determined by the Company’s compensation committee. On January 1, 2019 and 2018, the shares available for grant under the 2016 ESPP were automatically increased by 1,000,802 shares and 939,698 shares, respectively. The 2016 ESPP allows eligible employees to purchase shares of the Company’s Class A common stock at a discount of up to 15% through payroll deductions of their eligible compensation, subject to any plan limitations. Except for the initial offering period, the 2016 ESPP provides for separate six-month offering periods beginning in May and November of each fiscal year, starting in May 2017. On each purchase date, eligible employees purchase the Company’s stock at a price per share equal to 85% of the lesser of (i) the fair market value of the Company’s Class A common stock on the offering date or (ii) the fair market value of the Company’s Class A common stock on the purchase date. As of December 31, 2019 , total unrecognized compensation cost related to the 2016 ESPP was $4.4 million , which will be amortized over a weighted-average period of 0.4 years . Stock option activity under the Company's 2008 Plan and 2016 Plan as well as respective Stock Incentive Plans assumed in the SendGrid acquisition was as follows: Stock Options Number of Weighted- Weighted- Aggregate Outstanding options as of December 31, 2018 7,423,369 $ 16.07 6.80 $ 543,640 Granted 909,229 118.35 Assumed in acquisition 2,978,555 14.91 Exercised (3,620,866 ) 10.43 Forfeited and canceled (539,439 ) 51.28 Outstanding options as of December 31, 2019 7,150,848 $ 28.79 6.47 $ 511,971 Options vested and exercisable as of December 31, 2019 4,721,801 $ 14.00 5.65 $ 398,490 Year Ended December 31, 2019 2018 2017 (In thousands, except per share amounts) Aggregate intrinsic value of stock options exercised (1) $ 394,998 $ 178,504 $ 131,955 Total estimated grant date fair value of options vested $ 81,292 $ 21,761 $ 15,831 Weighted-average grant date fair value per share of options granted $ 58.13 $ 18.40 $ 13.33 _________ (1) Aggregate intrinsic value represents the difference between the fair value of the Company’s Class A common stock as reported on the New York Stock Exchange and the exercise price of outstanding “in-the-money” options. On February 28, 2017, the Company granted a total of 555,000 shares of performance-based stock options in three distinct awards to an employee with grant date fair values of $13.48 , $10.26 and $8.41 per share for a total grant value of $5.9 million . The first half of each award vests upon satisfaction of a performance condition and the remainder vests thereafter in equal monthly installments over a two year period. The achievement window expires after 4.3 years from the date of grant and the stock options expire seven years after the date of grant. The stock options are amortized over a derived service period, as adjusted, of 3.1 years , 3.9 years and 4.6 years , respectively. The stock options value and the derived service period were estimated using the Monte-Carlo simulation model. The following table summarizes the details of the performance options: Number of Weighted- Weighted- Aggregate Outstanding options as of December 31, 2018 555,000 $ 31.72 6.00 $ — Granted — — Exercised — — Forfeited and canceled — — Outstanding options as of December 31, 2019 555,000 $ 31.72 4.16 $ 36,941 Options vested and exercisable as of December 31, 2019 427,812 $ 31.72 4.16 $ 28,475 As of December 31, 2019 , total unrecognized compensation cost related to nonvested stock options was $95.6 million , which will be amortized on a ratable basis over a weighted-average period of 1.9 years . Restricted Stock Units Number of Weighted- Aggregate Nonvested RSUs as of December 31, 2018 8,262,902 $ 42.70 $ 729,373 Granted 3,413,404 119.04 Assumed in acquisition 561,999 112.88 Vested (2,893,119 ) 51.15 Forfeited and canceled (854,669 ) $ 61.94 Nonvested RSUs as of December 31, 2019 8,490,517 $ 74.21 $ 830,167 As of December 31, 2019 , total unrecognized compensation cost related to nonvested RSUs was $573.2 million , which will be amortized over a weighted-average period of 2.7 years . Valuation Assumptions The fair value of employee stock options was estimated on the date of grant using the following assumptions in the Black-Scholes option pricing model: Year Ended December 31, Employee Stock Options: 2019 2018 2017 Fair value of common stock $103.70 - $130.70 $33.01 - $76.63 $23.60 - $31.96 Expected term (in years) 0.33 - 6.08 1.00 - 6.08 6.08 Expected volatility 49.0% - 66.5% 38.6% - 44.2% 44.3% - 47.6% Risk-free interest rate 1.6% - 2.5% 2.9% - 3.0% 1.9% - 2.3% Dividend rate —% —% —% Year Ended December 31, Employee Stock Purchase Plan: 2019 2018 2017 Expected term (in years) 0.49 - 0.50 0.5 0.5 Expected volatility 43.1% - 50.3% 39.8% - 47.5% 33.2% - 33.9% Risk-free interest rate 1.6% - 2.4% 2.1% - 2.5% 1.1% - 1.4% Dividend rate —% —% —% The following assumptions were used in the Monte Carlo simulation model to estimate the grant date fair value and the derived service period of the performance options: Asset volatility 40% Equity volatility 45% Discount rate 14% Stock price at grant date $31.7 Stock-Based Compensation Expense The Company recorded the total stock-based compensation expense as follows. In the year ended December 31, 2019 , the stock-based compensation expense associated with awards assumed in the SendGrid acquisition was $81.8 million . Year Ended December 31, 2019 2018 2017 (In thousands) Cost of revenue $ 7,123 $ 1,126 $ 650 Research and development 126,012 42,277 22,808 Sales and marketing 60,886 23,616 9,822 General and administrative 70,297 26,254 16,339 Total $ 264,318 $ 93,273 $ 49,619 |
Net Loss Per Share Attributable
Net Loss Per Share Attributable to Common Stockholders | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share Attributable to Common Stockholders | Net Loss Per Share Attributable to Common Stockholders Basic and diluted net loss per common share is presented in conformity with the two-class method required for participating securities. Class A and Class B common stock are the only outstanding equity in the Company. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to 10 votes per share. Shares of Class B common stock may be converted into Class A common stock at any time at the option of the stockholder and are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Basic net loss per share attributable to common stockholders is computed using the weighted-average number of common shares outstanding during the period. Diluted net loss per share attributable to common stockholders is computed using the weighted-average number of common shares and, if dilutive, potential common shares outstanding during the period. The dilutive effect of these potential common shares is reflected in diluted earnings per share by application of the treasury stock method. The following table sets forth the calculation of basic and diluted net loss per share attributable to common stockholders during the periods presented: Year Ended December 31, 2019 2018 2017 (In thousands, except share and per share data) Net loss attributable to common stockholders $ (307,063 ) $ (121,949 ) $ (63,708 ) Weighted-average shares used to compute net loss per share attributable to 130,083,046 97,130,339 91,224,607 Net loss per share attributable to common stockholders, basic and diluted $ (2.36 ) $ (1.26 ) $ (0.70 ) The following outstanding shares of common stock equivalents were excluded from the calculation of the diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive: As of December 31, 2019 2018 2017 Stock options issued and outstanding 7,705,848 7,978,369 10,710,427 Nonvested restricted stock units issued and outstanding 8,490,517 8,262,902 5,665,459 Class A common stock reserved for Twilio.org 795,673 572,676 635,014 Class A common stock committed under 2016 ESPP 207,792 113,312 235,372 Conversion spread (1) 3,150,647 233 — Unvested shares subject to repurchase — 1,250 5,214 Total 20,350,477 16,928,742 17,251,486 _________ (1) Since the Company expects to settle the principal amount of its outstanding convertible senior notes in cash and any excess in shares of the Company's Class A common stock, the Company uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have a dilutive impact on diluted net income per share of Class A common stock when the average market price of the Company's Class A common stock for a given period exceeds the conversion price of $70.90 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table presents domestic and foreign components of loss before income taxes for the periods presented: Year Ended December 31, 2019 2018 2017 (In thousands) United States $ (328,902 ) $ (96,448 ) $ (46,737 ) International (33,314 ) (24,710 ) (16,266 ) Loss before provision for income taxes $ (362,216 ) $ (121,158 ) $ (63,003 ) Provision for income taxes consists of the following: Year Ended December 31, 2019 2018 2017 Current: (In thousands) Federal $ — $ — $ 99 State 198 139 78 Foreign 2,684 881 823 Total 2,882 1,020 1,000 Deferred: Federal (49,393 ) 29 28 State (7,474 ) 19 10 Foreign (1,168 ) (277 ) (333 ) Total (58,035 ) (229 ) (295 ) Income tax provision (benefit) $ (55,153 ) $ 791 $ 705 The following table presents a reconciliation of the statutory federal tax rate and the Company's effective tax rate: Year Ended December 31, 2019 2018 2017 Tax benefit at federal statutory rate 21 % 21 % 34 % State tax, net of federal benefit 8 15 10 Stock-based compensation 14 31 47 Credits 4 8 8 Foreign rate differential (2 ) (4 ) (8 ) Change in valuation allowance (29 ) (68 ) (46 ) Change in federal statutory rate — — (45 ) Other (1 ) (3 ) (1 ) Effective tax rate 15 % — % (1 )% Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The following table presents the significant components of the Company's deferred tax assets and liabilities: As of December 31, 2019 2018 2017 Deferred tax assets: (In thousands) Net operating loss carryforwards $ 274,116 $ 116,190 $ 56,138 Accrued and prepaid expenses 11,828 11,594 9,140 Stock-based compensation 35,035 11,147 7,131 Research and development credits 65,955 32,206 16,212 Charitable contributions 3,172 3,100 1,233 Capped call 9,914 13,175 — Debt issuance cost 493 638 — Depreciable property 2 — — Lease liability 39,117 — — Other — 194 472 Gross deferred tax assets 439,632 188,244 90,326 Valuation allowance (255,893 ) (147,354 ) (78,900 ) Net deferred tax assets 183,739 40,890 11,426 Deferred tax liabilities: Capitalized software (13,032 ) (10,686 ) (7,664 ) Prepaid expenses (1,157 ) (838 ) (1,015 ) Acquired intangibles (107,281 ) (2,997 ) (2,101 ) Property and equipment (1,578 ) (1,990 ) (2,380 ) Convertible debt (20,745 ) (27,164 ) — Right-of-use asset (39,630 ) — — Deferred commissions (7,446 ) (2,396 ) (718 ) Other (405 ) — — Net deferred tax liability $ (7,535 ) $ (5,181 ) $ (2,452 ) The following table summarizes our tax carryforwards, carryovers, and credits: As of Expiration Date (In thousands) Federal net operating loss carryforwards $ 1,159,329 Various dates beginning in 2029 Federal tax credits $ 58,404 Various dates beginning in 2029 Federal net operating loss carryforwards $ 902,507 Indefinite State net operating loss carryforwards $ 630,151 Various dates beginning in 2025 State tax credits $ 38,817 Indefinite Foreign net operating loss carryforwards $ 13,772 Indefinite A limitation may apply to the use of the net operating loss and credit carryforwards, under provisions of the Internal Revenue Code of 1986, as amended, and similar state tax provisions that are applicable if the Company experiences an "ownership change." An ownership change may occur, for example, as a result of issuance of new equity. Should these limitations apply, the carryforwards would be subject to an annual limitation, resulting in a potential reduction in the gross deferred tax assets before considering the valuation allowance. The Company's accounting for deferred taxes involves the evaluation of a number of factors concerning the realizability of its net deferred tax assets. The Company primarily considered such factors as its history of operating losses, the nature of the Company's deferred tax assets, and the timing, likelihood and amount, if any, of future taxable income during the periods in which those temporary differences and carryforwards become deductible. At present, the Company does not believe that it is more likely than not that the net deferred tax assets will be realized, accordingly, a full valuation allowance has been established. The valuation allowance increased by approximately $108.5 million and $68.5 million during the years ended December 31, 2019 and 2018 , respectively. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Year Ended December 31, 2019 2018 2017 (In thousands) Unrecognized tax benefit, beginning of year $ 15,635 $ 9,445 $ 12,275 Gross increases for tax positions of prior years 12,939 1,233 493 Gross decrease for tax positions of prior years (395 ) (4 ) (6,331 ) Gross increases for tax positions of current year 20,863 4,961 3,008 Unrecognized tax benefit, end of year $ 49,042 $ 15,635 $ 9,445 As of December 31, 2019 , the Company had approximately $49.0 million of unrecognized tax benefits. If the $49.0 million is recognized, $1.7 million would affect the effective tax rate. The remaining amount would be offset by the reversal of related deferred tax assets which are subject to a full valuation allowance. The Company recognizes interest and penalties, if any, related to uncertain tax positions in its income tax provision. As of December 31, 2019 , the Company has accumulated $0.2 million in both interest and penalties related to uncertain tax positions. The Company does not anticipate any significant changes within 12 months of December 31, 2019 , in its uncertain tax positions that would be material to the consolidated financial statements taken as a whole because nearly all of the unrecognized tax benefit has been offset by a deferred tax asset, which has been reduced by a valuation allowance. The Company files U.S. federal income tax returns as well as income tax returns in many U.S. states and foreign jurisdictions. As of December 31, 2019 , the tax years 2008 through the current period remain open to examination by the major jurisdictions in which the Company is subject to tax. Fiscal years outside the normal statute of limitation remain open to audit by tax authorities due to tax attributes generated in those early years, which have been carried forward and may be audited in subsequent years when utilized. The Company is not currently subject to U.S. federal, state and local, or non-U.S. income tax examinations by any tax authorities. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (Tax Act). The Tax Act reduces the U.S. statutory corporate tax rate to 21% , effective January 1, 2018. Consequently, we recorded a decrease to the Company's federal deferred tax assets of $28.0 million , which was fully offset by a reduction in the Company's valuation allowance for the year ended December 31, 2017 . The other provisions of the Tax Act, including the one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings, did not have a material impact on the Company's financial statements as of December 31, 2019 or 2018 . In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which allowed companies to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. The Company's accounting for the Tax Act is complete and we did not have any significant adjustments to provisional amounts recorded as of December 31, 2017 . The Tax Act creates a new requirement that certain income (i.e., GILTI) earned by controlled foreign corporations (CFCs) must be included currently in the gross income of the CFCs' U.S. shareholder. Under U.S. GAAP, the Company is allowed to make an accounting policy choice of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the "period cost method") or (2) factoring such amounts into the measurement of its deferred taxes (the "deferred method"). The Company selected the period cost method. In connection with the SendGrid acquisition, the Company recorded a net deferred tax liability which provides an additional source of taxable income to support the realization of the pre-existing deferred tax assets and, accordingly, during the year ended December 31, 2019 , the Company released a total of $55.0 million of its U.S. valuation allowance. The Company continues to maintain a valuation allowance for its U.S. Federal and State net deferred tax assets. The provision for income taxes recorded in the years ended December 31, 2018 and 2017 , consists primarily of income taxes and withholding taxes in foreign jurisdictions in which the Company conducts business. The Company’s U.S. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are used for, but not limited to, revenue allowances and sales credit reserves; recoverability of long-lived and intangible assets; capitalization and useful life of the Company’s capitalized internal-use software development costs; fair value of acquired intangible assets and goodwill; accruals and contingencies. Estimates are based on historical experience and on various assumptions that the Company believes are reasonable under current circumstances. However, future events are subject to change and best estimates and judgments may require further adjustments, therefore, actual results could differ materially from those estimates. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially expose the Company to a concentration of credit risk consist primarily of cash, cash equivalents, marketable securities and accounts receivable. The Company maintains cash, cash equivalents and marketable securities with financial institutions that management believes are financially sound and have minimal credit risk exposure although the balances will exceed insured limits. |
Revenue Recognition | Revenue Recognition Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Revenue is recognized net of allowances for credits and any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company determines revenue recognition through the following steps: • Identification of the contract, or contracts, with a customer; • Identification of the performance obligations in the contract; • Determination of the transaction price; • Allocation of the transaction price to the performance obligations in the contract; and • Recognition of revenue when, or as, the Company satisfies a performance obligation. Nature of Products and Services The Company's revenue is primarily derived from usage-based fees earned from customers accessing the Company's enterprise cloud computing services. Platform access is considered a monthly series comprising of one performance obligation and usage-based fees are recognized as revenue in the period in which the usage occurs. In the years ended December 31, 2019 , 2018 and 2017 , the revenue from usage-based fees represented 75% , 84% and 83% of total revenue, respectively. Subscription-based fees are derived from certain non-usage-based contracts, such as with the sales of short codes and customer support. Non-usage-based contracts revenue is recognized on a ratable basis over the contractual term which is generally one year or less. In the years ended December 31, 2019 , 2018 and 2017 , the revenue from non-usage-based fees represented 25% , 16% , and 17% of total revenue, respectively. The Company applied the optional exemption of not disclosing the transaction price allocated to the remaining performance obligations for its usage-based contracts and contracts with original duration of one year or less. The majority of the Company's contracts have a duration of one year or less. No significant judgments are required in determining whether products and services are considered distinct performance obligations and should be accounted for separately versus together, or to determine the stand-alone selling price ("SSP"). The Company's arrangements do not contain general rights of return. However, credits may be issued on a case-by-case basis. The contracts do not provide customers with the right to take possession of the software supporting the applications. Amounts that have been invoiced are recorded in accounts receivable and in revenue or deferred revenue depending on whether the revenue recognition criteria have been met. |
Deferred Revenue and Customer Deposits and Deferred Sales Commissions | Deferred Revenue and Customer Deposits Deferred revenue is recorded when cash payments are received in advance of future usage on non-cancelable contracts. Customer refundable prepayments are recorded as customer deposits. As of December 31, 2019 and 2018 , the Company recorded $26.4 million and $23.0 million as its deferred revenue and customer deposits, respectively. During the years ended December 31, 2019 and 2018 , the Company recognized $18.7 million and $10.6 million of revenue, respectively, that was included in the deferred revenue and customer deposits balance as of the end of the prior year. (g) Deferred Sales Commissions The Company records an asset for the incremental costs of obtaining a contract with a customer, for example, sales commissions that are earned upon execution of contracts. The Company uses the portfolio of data method to determine the estimated period of benefit of capitalized commissions which is determined to be five years . Amortization expense related to these capitalized costs related to initial contracts, upsells and renewals, is recognized on a straight line basis over the estimated period of benefit of the capitalized commissions. |
Cost of Revenue | Cost of Revenue Cost of revenue consists primarily of costs of communications services purchased from network service providers. Cost of revenue also includes fees to support the Company's cloud infrastructure, direct costs of personnel, such as salaries and stock-based compensation for the customer care and support services employees, and non-personnel costs, such as amortization of capitalized internal-use software development costs and amortization of acquired intangibles. |
Research and Development Expense | Research and Development Expense |
Internal-Use Software Development Costs | Internal-Use Software Development Costs Certain costs of platform and other software applications developed for internal use are capitalized. The Company capitalizes qualifying internal-use software development costs that are incurred during the application development stage. Capitalization of costs begins when two criteria are met: (i) the preliminary project stage is completed and (ii) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Costs incurred for maintenance, minor upgrades and enhancements are expensed. Costs related to preliminary project activities and post-implementation operating activities are also expensed as incurred. |
Advertising Costs | Advertising Costs Advertising costs are expensed as incurred and were $27.0 million , $10.6 million and $4.9 million in the years ended December 31, 2019 , 2018 , and 2017 , respectively. Advertising costs are included in sales and marketing expenses in the accompanying consolidated statements of operations. |
Stock-based Compensation | Stock-Based Compensation All stock-based compensation to employees, including the purchase rights issued under the Company's 2016 Employee Stock Purchase Plan (the "ESPP"), is measured on the grant date based on the fair value of the awards on the date of grant. This cost is recognized as an expense following straight-line attribution method over the requisite service period. The Company uses the Black-Scholes option pricing model to measure the fair value of its stock options and the purchase rights issued under the ESPP. The fair value of the restricted stock units is determined using the fair value of the Company's Class A common stock on the date of grant and recognized as an expense following straight-line attribution method over the requisite service period. Prior to adoption of ASU 2016-09, the stock-based compensation was recorded net of estimated forfeitures. Compensation expense for stock options granted to nonemployees is calculated using the Black-Scholes option pricing model and is recognized in expense over the service period. The Black-Scholes option pricing model requires the use of complex assumptions, which determine the fair value of stock-based awards. These assumptions include: • Fair value of the common stock. The Company uses the market closing price of its Class A common stock, as reported on the New York Stock Exchange, for the fair value. • Expected term. The expected term represents the period that the stock-based awards are expected to be outstanding. The Company uses the simplified calculation of expected term, as the Company does not have sufficient historical data to use any other method to estimate expected term; • Expected volatility. The expected volatility is derived from an average of the historical volatilities of the common stock of the Company and several other entities with characteristics similar to those of the Company, such as the size and operational and economic similarities to the Company's principal business operations; • Risk -free interest rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal to the expected term of the stock-based awards; and • Expected dividend. The expected dividend is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock. If any of the assumptions used in the Black-Scholes model changes, stock-based compensation for future options may differ materially compared to that associated with previous grants. |
Income Taxes | Income Taxes The Company accounts for income taxes in accordance with authoritative guidance which requires the use of the asset and liability approach. Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as net operating loss and tax credit carry-forwards. Deferred tax amounts are determined by using the enacted tax rates expected to be in effect when the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance reduces the deferred tax assets to the amount that is more likely than not to be realized. The Company recognizes the effect of uncertain income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company records interest and penalties related to uncertain tax positions in the provision for income taxes in the consolidated statements of operations. |
Foreign Currency Translation | Foreign Currency Translation The functional currency of the Company's foreign subsidiaries is generally the U.S. dollar. Accordingly, the subsidiaries remeasure monetary assets and liabilities at period-end exchange rates, while non-monetary items are remeasured at historical rates. Revenue and expense accounts are remeasured at the average exchange rate in effect during the year. Remeasurement adjustments are recognized in the consolidated statements of operations as other income or expense in the year of occurrence. Foreign currency transaction gains and losses were insignificant for all periods presented. For those entities where the functional currency is a foreign currency, adjustments resulting from translating the financial statements into U.S. dollars are recorded as a component of accumulated other comprehensive income (loss) in stockholders' equity. Monetary assets and liabilities denominated in a foreign currency are translated into US dollars at the exchange rate on the balance sheet date. Revenue and expenses are translated at the weighted average exchange rates during the period. Equity transactions are translated using historical exchange rates. Foreign currency transaction gains and losses are included in other income (expense), net in the consolidated statements of operations. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) refers to net income (loss) and other revenue, expenses, gains and losses that, under generally accepted accounting principles, are recorded as an element of stockholders' equity but are excluded from the calculation of net income (loss). |
Net Loss Per Share Attributable to Common Stockholders | Net Loss Per Share Attributable to Common Stockholders The Company calculates its basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. All series of convertible preferred stock are considered to be participating securities as the holders of the preferred stock are entitled to receive a non-cumulative dividend on a pro rata pari passu basis in the event that a dividend is declared or paid on common stock. Shares of common stock issued upon early exercise of stock options that are subject to repurchase are also considered to be participating securities, because holders of such shares have non-forfeitable dividend rights in the event a dividend is declared or paid on common stock. Under the two-class method, in periods when the Company has net income, net income attributable to common stockholders is determined by allocating undistributed earnings, calculated as net income less current period convertible preferred stock non-cumulative dividends, between common stock and the convertible preferred stock. In computing diluted net income attributable to common stockholders, undistributed earnings are re-allocated to reflect the potential impact of dilutive securities. The Company's basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. The dilutive effect of these potential common shares is reflected in diluted earnings per share by application of the treasury stock method. For purposes of this calculation, convertible preferred stock, options to purchase common stock, unvested restricted stock units, common stock issued subject to future vesting, any shares of stock committed under the ESPP, any shares of stock held in escrow and any shares of stock reserved for future donations are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is antidilutive. Class A and Class B common stock are the only outstanding equity of the Company. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to 10 votes per share. Shares of Class B common stock may be converted into Class A common stock at any time at the option of the stockholder on a one -for-one basis, and are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Shares of Class A common stock are not convertible. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash equivalents consist of cash deposited into money market funds and reverse repurchase agreements. All credit and debit card transactions that process as of the last day of each month and settle within the first few days of the subsequent month are also classified as cash and cash equivalents as of the end of the month in which they were processed. |
Restricted Cash | Restricted Cash Restricted cash consists of cash deposited into a savings account with a financial institution as collateral for the Company's obligations under certain vendor and facility leases contracts. |
Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts |
Costs Related to Public Offerings | Costs Related to Public Offerings |
Property and Equipment | Property and Equipment Property and equipment, both owned and under finance leases, is stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful life of the related asset. Maintenance and repairs are charged to expenses as incurred. The useful lives of property and equipment are as follows: Capitalized internal-use software development costs 3 years Data center equipment 2 - 4 years Office equipment 3 years Furniture and fixtures 5 years Software 3 years Assets under financing lease 5 years or remaining lease term Leasehold improvements 5 years or remaining lease term |
Leases | Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02, "Leases (Topic 842)" , which was further clarified in July 2018 by ASU 2018‑10, “ Codification Improvements to Topic 842, Leases” , and ASU 2018‑11, “ Leases-Targeted Improvements” . ASU 2018-10 provides narrow amendments to clarify how to apply certain aspects of the new lease standard. ASU 2018-11 addresses implementation issues related to the new lease standard. The standard became effective for the Company on January 1, 2019. Under this standard, lessees are required to recognize in the balance sheet the right-of-use ("ROU") assets and lease liabilities that arise from operating leases. The Company adopted the standard using the optional alternative method on a prospective basis with an effective date as of the beginning of the Company’s fiscal year, January 1, 2019, and applied it to the operating leases that existed on that date. Prior year comparative financial information was not recast under the new standard and continues to be presented under ASC 840. The Company elected to utilize the package of practical expedients available for expired or existing contracts which allowed the Company to carryforward historical assessments of (a) whether contracts are or contain leases, (b) lease classification, and (c) initial direct costs. The Company elected the use of hindsight practical expedient in determining the lease term and assessing the likelihood that lease renewal, termination or purchase option will be exercised. The Company also elected to apply the short-term lease exception for all leases. Under the short-term lease exception, the Company will not recognize ROU assets or lease liabilities for leases that, at the acquisition date, have a remaining lease term of 12 months or less. As a result of implementing this guidance, the Company recognized a $123.5 million net operating ROU asset and a $132.0 million operating lease liability in its consolidated balance sheet as of January 1, 2019. The ROU asset was presented net of deferred rent of $9.0 million as of January 1, 2019, in the accompanying consolidated balance sheet. In addition, on February 1, 2019, the Company acquired through its business combination with SendGrid approximately $33.7 million in operating ROU assets, $32.6 million in operating lease liability, $14.2 million in finance ROU assets and $13.6 million in finance lease liability. The Company measured the lease liability at the present value of the future lease payments as of January 1, 2019. The Company used its incremental borrowing rate to discount the lease payments. The Company derived the discount rate, adjusted for differences in the term and payment patterns, from the information available at the adoption date. The right-of-use asset is valued at the amount of the lease liability adjusted for the remaining December 31, 2018, balance of unamortized lease incentives, prepaid rent and deferred rent. The lease liability is subsequently measured at the present value of unpaid future lease payments as of the reporting date with a corresponding adjustment to the right-of-use asset. Absent a lease modification, the Company will continue to utilize the January 1, 2019, incremental borrowing rate. The Company recognizes operating lease costs on a straight-line basis and presents these costs as operating expenses within the consolidated statements of operations and comprehensive loss. Within the consolidated statements of cash flows the Company presents the lease payments made on the operating leases within the cash flows from operations and principal payments made on the finance leases as part of financing activities. The financial results for the year ended December 31, 2019 , are presented under the new standard, while the comparative periods presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. |
Intangible Assets | Intangible Assets Intangible assets recorded by the Company are costs directly associated with securing legal registration of patents and trademarks, acquiring domain names and the fair value of identifiable intangible assets acquired in business combinations. Intangible assets with determinable economic lives are carried at cost, less accumulated amortization. Amortization is computed over the estimated useful life of each asset on a straight-line basis. The Company determines the useful lives of identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, the Company's long-term strategy for using the asset, any laws or other local regulations which could impact the useful life of the asset and other economic factors, including competition and specific market conditions. Intangible assets without determinable economic lives are carried at cost, not amortized and reviewed for impairment at least annually. The useful lives of the intangible assets are as follows: Developed technology 3 - 7 years Customer relationships 2 - 8 years Supplier relationships 2 - 5 years Trade names 5 years Patents 20 years Telecommunication licenses Indefinite Trademarks Indefinite Domain names Indefinite |
Goodwill | Goodwill Goodwill represents the excess of the aggregate purchase price over the fair value of net identifiable assets acquired in a business combination. Goodwill is not amortized and is tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company has determined that it operates as one reporting unit and has selected November 30 as the date to perform its annual impairment test. In the valuation of goodwill, management must make assumptions regarding estimated future cash flows to be derived from the Company's business. If these estimates or their related assumptions change in the future, the Company may be required to record impairment for these assets. The Company has the option to first perform a qualitative assessment to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. However, the Company may elect to bypass the qualitative assessment and proceed directly to the quantitative impairment tests. The first step of the impairment test involves comparing the fair value of the reporting unit to its net book value, including goodwill. If the net book value exceeds its fair value, the Company would perform the second step of the goodwill impairment test to determine the amount of the impairment loss. In January 2017, the FASB issued ASU 2017‑04, “Simplifying the Test for Goodwill Impairment” , which removes the second step of the goodwill impairment test that required a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value. The impairment is limited to the carrying amount of goodwill. This guidance is applied prospectively. The Company early adopted this guidance effective April 1, 2019, which did not have a material impact to its consolidated financial statements. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company evaluates its long-lived assets, including property and equipment and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. |
Business Combinations | Business Combinations The Company recognizes identifiable assets acquired and liabilities assumed at their acquisition date fair values. Goodwill is measured as the excess of the consideration transferred over the fair value of assets acquired and liabilities assumed on the acquisition date. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed, these estimates are inherently uncertain and subject to refinement. The authoritative guidance allows a measurement period of up to one year from the date of acquisition to make adjustments to the preliminary allocation of the purchase price. As a result, during the measurement period the Company may record adjustments to the fair values of assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent that it identifies adjustments to the preliminary purchase price allocation. Upon conclusion of the measurement period or final determination of the values of the assets acquired and liabilities assumed, whichever comes first, any subsequent adjustments will be recorded to the consolidated statement of operations. |
Segment Information | Segment Information The Company's Chief Executive Officer is the chief operating decision maker, who reviews the Company's financial information presented on a consolidated basis for purposes of allocating resources and evaluating the Company's financial performance. Accordingly, the Company has determined that it operates in a single reporting segment. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company applies fair value accounting for all financial instruments on a recurring basis. The Company's financial instruments, which include cash, cash equivalents, accounts receivable and accounts payable are recorded at their carrying amounts, which approximate their fair values due to their short-term nature. Restricted cash is long-term in nature and consists of cash in a savings account, hence its carrying amount approximates its fair value. Marketable securities consist of U.S. treasury securities, high credit quality corporate debt securities and reverse repurchase agreements. All marketable securities are considered to be available-for-sale and recorded at their estimated fair values. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive income (loss). In valuing these items, the Company uses inputs and assumptions that market participants would use to determine their fair value, utilizing valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value of the convertible senior notes due 2023 (the "Notes") is determined based on the closing price for the Notes on the last trading day of the reporting period and is considered as Level 2 in the fair value hierarchy. Impairments are considered to be other than temporary if they are related to deterioration in credit risk or if it is likely that the security will be sold before the recovery of its cost basis. Realized gains and losses and declines in value deemed to be other than temporary are determined based on the specific identification method and are reported in other income (expense), net. The accounting guidance for fair value provides a framework for measuring fair value, clarifies the definition of fair value, and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value as follows: • Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. • Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. A financial instrument's categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820) Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement” . The amendments under ASU 2018-13 remove, add and modify certain disclosure requirements on fair value measurements. The amendments are effective for interim and annual periods beginning after December 15, 2019. The Company early adopted this guidance effective April 1, 2019, which did not have a material impact to its consolidated financial statements. |
Recently Issued Accounting Guidance, Not yet Adopted | Recently Issued Accounting Guidance, Not yet Adopted In December 2019, the FASB issued ASU 2019-12, "Simplifying the Accounting for Income Taxes" which simplifies the accounting for income taxes by removing certain exceptions to the general principles for income taxes. ASU 2019-12 will be effective for the Company beginning January 1, 2021, and early adoption is permitted. The Company does not expect the adoption of this guidance to have a material impact on its consolidated financial statements In August 2018, the FASB issued ASU 2018‑15, “ Intangibles—Goodwill and Other—Internal‑Use Software (Subtopic 350‑40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract”. This standard aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal‑use software. The standard is effective for interim and annual periods beginning after December 15, 2019, with early adoption permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements. In June 2016, the FASB issued ASU 2016‑13, “Financial Instruments-Credit Losses: Measurement of Credit Losses on Financial Instruments” , which changes the impairment model for most financial assets. The new model uses a forward‑looking expected loss method, which will generally result in earlier recognition of allowances for losses. In November 2018, the FASB issued ASU 2018‑19, “Codification Improvements to Topic 326, Financial Instruments-Credit Losses” , which clarifies that receivables arising from operating leases are no t within the scope of Topic 326, Financial Instruments-Credit Losses . Instead, impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases. In April 2019, the FASB issued ASU 2019-04, "Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments," which clarifies treatment of certain credit losses. In May 2019, the FASB issued ASU 2019-05, "Financial Instruments — Credit Losses (Topic 326): Targeted Transition Relief", which permits an entity, upon adoption of ASU 2016-13, to irrevocably elect the fair value option (on an instrument-by-instrument basis) for eligible financial assets measured at amortized cost basis. In November 2019, the FASB issued ASU 2019-11, "Codification Improvements to Topic 326, Financial Instruments - Credit Losses" , which clarifies the accounting treatment and disclosure requirements for assets purchased with credit deterioration, troubled debt restructurings, and certain other investments. In February 2020, the FASB issued ASU 2020-02, "Financial Instruments—Credit Losses (Topic 326) and Leases (Topic 842) Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective Date Related to Accounting Standards Update No. 2016-02, Leases (Topic 842)." This ASU provides guidance regarding methodologies, documentation, and internal controls related to expected credit losses. These ASUs are effective for interim and annual periods beginning after December 15, 2019, and early adoption is permitted. The Company is evaluating the impact of this guidance on its consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of property and equipment | The useful lives of property and equipment are as follows: Capitalized internal-use software development costs 3 years Data center equipment 2 - 4 years Office equipment 3 years Furniture and fixtures 5 years Software 3 years Assets under financing lease 5 years or remaining lease term Leasehold improvements 5 years or remaining lease term Year Ended December 31, 2019 2018 2017 (In thousands) Cost of revenue $ 9,546 $ 6,898 $ 4,788 Research and development 7,345 5,437 3,619 General and administrative 213 689 — Total $ 17,104 $ 13,024 $ 8,407 Property and equipment consisted of the following: As of December 31, 2019 2018 (In thousands) Capitalized internal-use software development costs $ 100,155 $ 72,647 Data center equipment (1) 22,009 — Leasehold improvements 55,886 15,293 Office equipment 25,083 13,563 Furniture and fixtures (1) 10,095 4,918 Software 9,176 1,849 Total property and equipment 222,404 108,270 Less: accumulated depreciation and amortization (81,148 ) (44,736 ) Total property and equipment, net $ 141,256 $ 63,534 _______________ (1) Data center equipment and furniture and fixtures contain assets under finance leases. See Note 5 for further detail. |
Schedule of intangible assets | The useful lives of the intangible assets are as follows: Developed technology 3 - 7 years Customer relationships 2 - 8 years Supplier relationships 2 - 5 years Trade names 5 years Patents 20 years Telecommunication licenses Indefinite Trademarks Indefinite Domain names Indefinite |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of financial assets measured at fair value on a recurring basis | The following tables provide the financial assets measured at fair value on a recurring basis: Amortized Gross Gross Gross Fair Value Hierarchy as of Aggregate Level 1 Level 2 Level 3 Financial Assets: (In thousands) Cash and cash equivalents: Money market funds $ 153,252 $ — $ — $ — $ 153,252 $ — $ — $ 153,252 Reverse repurchase agreements 35,800 — — — — 35,800 — 35,800 Total included in cash and cash equivalents 189,052 — — — 153,252 35,800 — 189,052 Marketable securities: U.S. Treasury securities 215,847 241 (3 ) — 216,085 — — 216,085 Corporate debt securities and commercial paper 1,378,487 4,516 (55 ) — 5,000 1,377,948 — 1,382,948 Total marketable securities 1,594,334 4,757 (58 ) — 221,085 1,377,948 — 1,599,033 Strategic investments 5,500 — — — — — 5,500 5,500 Total financial assets $ 1,788,886 $ 4,757 $ (58 ) $ — $ 374,337 $ 1,413,748 $ 5,500 $ 1,793,585 Amortized Gross Gross Gross Fair Value Hierarchy as of Aggregate Level 1 Level 2 Level 3 Financial Assets: (In thousands) Cash and cash equivalents: Money market funds $ 420,234 $ — $ — $ — $ 420,234 $ — $ — $ 420,234 Reverse repurchase agreements 35,000 — — — — 35,000 — 35,000 Commercial paper 9,983 — — — — 9,983 — 9,983 Total included in cash and cash equivalents 465,217 — — — — 420,234 44,983 — 465,217 Marketable securities: U.S. Treasury securities 59,785 — (7 ) (9 ) 59,769 — — 59,769 Corporate debt securities and commercial paper 201,683 23 (123 ) (224 ) — 201,359 — 201,359 Total marketable securities 261,468 23 (130 ) (233 ) 59,769 201,359 — 261,128 Total financial assets $ 726,685 $ 23 $ (130 ) $ (233 ) $ 480,003 $ 246,342 $ — $ 726,345 |
Schedule of contractual maturities of marketable securities | The following table summarizes the contractual maturities of marketable securities: As of December 31, 2019 As of December 31, 2018 Amortized Aggregate Amortized Aggregate Financial Assets: (In thousands) Less than one year $ 859,996 $ 861,181 $ 261,468 $ 261,128 One to three years 734,338 737,852 — — Total $ 1,594,334 $ 1,599,033 $ 261,468 $ 261,128 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | The useful lives of property and equipment are as follows: Capitalized internal-use software development costs 3 years Data center equipment 2 - 4 years Office equipment 3 years Furniture and fixtures 5 years Software 3 years Assets under financing lease 5 years or remaining lease term Leasehold improvements 5 years or remaining lease term Year Ended December 31, 2019 2018 2017 (In thousands) Cost of revenue $ 9,546 $ 6,898 $ 4,788 Research and development 7,345 5,437 3,619 General and administrative 213 689 — Total $ 17,104 $ 13,024 $ 8,407 Property and equipment consisted of the following: As of December 31, 2019 2018 (In thousands) Capitalized internal-use software development costs $ 100,155 $ 72,647 Data center equipment (1) 22,009 — Leasehold improvements 55,886 15,293 Office equipment 25,083 13,563 Furniture and fixtures (1) 10,095 4,918 Software 9,176 1,849 Total property and equipment 222,404 108,270 Less: accumulated depreciation and amortization (81,148 ) (44,736 ) Total property and equipment, net $ 141,256 $ 63,534 _______________ (1) Data center equipment and furniture and fixtures contain assets under finance leases. See Note 5 for further detail. |
Right-of-Use Asset and Lease _2
Right-of-Use Asset and Lease Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Lease, Cost | The components of the lease expense recorded in the consolidated statement of operations were as follows: Year Ended December 31, 2019 (In thousands) Operating lease cost $ 32,558 Finance lease cost: Amortization of assets 6,090 Interest on lease liabilities 708 Short-term lease cost 6,342 Variable lease cost 3,792 Total net lease cost $ 49,490 Supplemental cash flow and other information related to leases was as follows: Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: (In thousands) Operating cash flows from operating leases $ 28,291 Operating cash flows from finance leases (interest) $ 687 Financing cash flows from finance leases $ 5,646 Weighted average remaining lease term (in years): Operating leases 6.1 Finance leases 3.0 Weighted average discount rate: Operating leases 5.5 % Finance leases 5.3 % |
Assets and Liabilities, Lessee | Supplemental balance sheet information related to leases was as follows: Leases Classification As of Assets: (In thousands) Operating lease assets Operating right-of-use asset, net of accumulated amortization (1) $ 156,741 Finance lease assets Property and equipment, net of accumulated depreciation (2) 14,770 Total leased assets $ 171,511 Liabilities: Current Operating Operating lease liability, current $ 27,156 Finance Financing lease liability, current 6,924 Noncurrent Operating Operating lease liability, noncurrent 139,200 Finance Finance lease liability, noncurrent 8,746 Total lease liabilities $ 182,026 __________ (1) Operating lease assets are recorded net of accumulated amortization of $23.2 million as of December 31, 2019 . (2) Finance lease assets are recorded net of accumulated depreciation of $6.0 million as of December 31, 2019 . |
Lessee, Operating Lease, Liability, Maturity | Maturities of lease liabilities were as follows: As of December 31, 2019 Operating Finance Year Ended December 31, (In thousands) 2020 $ 35,997 $ 7,586 2021 34,762 4,659 2022 33,214 2,333 2023 27,859 1,581 2024 25,400 315 Thereafter 43,125 581 Total lease payments 200,357 17,055 Less: imputed interest (34,001 ) (1,385 ) Total lease obligations 166,356 15,670 Less: current obligations (27,156 ) (6,924 ) Long-term lease obligations $ 139,200 $ 8,746 |
Finance Lease, Liability, Maturity | Maturities of lease liabilities were as follows: As of December 31, 2019 Operating Finance Year Ended December 31, (In thousands) 2020 $ 35,997 $ 7,586 2021 34,762 4,659 2022 33,214 2,333 2023 27,859 1,581 2024 25,400 315 Thereafter 43,125 581 Total lease payments 200,357 17,055 Less: imputed interest (34,001 ) (1,385 ) Total lease obligations 166,356 15,670 Less: current obligations (27,156 ) (6,924 ) Long-term lease obligations $ 139,200 $ 8,746 |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payment obligations under noncancelable operating and finance leases were as follows: As of December 31, 2019 Operating Financing Year Ended December 31, (In thousands) 2019 $ 24,128 $ 306 2020 29,527 512 2021 30,898 573 2022 30,492 590 2023 30,122 608 Thereafter 81,316 1,939 Total minimum lease payments $ 226,483 $ 4,528 |
Schedule of Future Minimum Lease Payments for Capital Leases | Future minimum lease payment obligations under noncancelable operating and finance leases were as follows: As of December 31, 2019 Operating Financing Year Ended December 31, (In thousands) 2019 $ 24,128 $ 306 2020 29,527 512 2021 30,898 573 2022 30,492 590 2023 30,122 608 Thereafter 81,316 1,939 Total minimum lease payments $ 226,483 $ 4,528 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of purchase price allocation | The following table presents the purchase price allocation, as adjusted, recorded in the Company's consolidated balance sheet as of December 31, 2019 . Total (In thousands) Cash and cash equivalents $ 156,783 Accounts receivable and other current assets 11,635 Property and equipment, net 38,350 Operating right-of-use asset 33,742 Intangible assets (1) 483,000 Other assets 1,664 Goodwill 2,235,193 Accounts payable and other liabilities (11,114 ) Operating lease liability (32,568 ) Finance lease liability (13,616 ) Note payable (5,387 ) Deferred tax liability (56,230 ) Total purchase price $ 2,841,452 __________________________ (1) Identifiable intangible assets are comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 294,000 7 Customer relationships 169,000 7 Trade names 20,000 5 Total intangible assets acquired $ 483,000 The following table summarizes the preliminary purchase price allocation in aggregate for the other business acquired in fiscal 2019 recorded in the Company's consolidated balance sheet as of December 31, 2019 : Total (In thousands) Net liabilities $ (3,219 ) Intangible assets (1) 22,986 Goodwill 23,425 Total preliminary purchase price $ 43,192 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 11,771 4 - 6 Customer relationships 5,185 3 - 5 Telecommunication licenses 4,370 Indefinite Supplier relationships 1,660 2 Total intangible assets acquired $ 22,986 The following table presents the purchase price allocation recorded in the Company's consolidated balance sheet as of December 31, 2018: Total (In thousands) Net liabilities $ (1,538 ) Intangible assets (1) 9,920 Goodwill (2) 13,375 Total purchase price $ 21,757 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 9,090 4 Customer relationships 830 2 Total intangible assets acquired $ 9,920 (2) The goodwill is primarily attributable to the future cash flows to be realized from the acquired technology platform as well as operational synergies. The Company has filed for the elections that make the goodwill deductible for U.S. tax purposes. The following table presents the purchase price allocation recorded in the Company's consolidated balance sheet: Total (In thousands) Net liabilities $ (3,575 ) Intangible assets (1) 13,700 Goodwill (2) 12,837 Total purchase price $ 22,962 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 5,000 4 Customer relationships 6,100 7 - 8 Supplier relationships 2,600 5 Total intangible assets acquired $ 13,700 (2) Goodwill represents the excess of purchase price over the fair value of identifiable tangible and intangible assets acquired and liabilities assumed. The goodwill in this transaction was primarily attributable to the future cash flows to be realized from the acquired technology platform, existing customer and supplier relationships as well as operational synergies. Goodwill is deductible for tax purposes. The following table presents the purchase price allocation recorded in the Company's consolidated balance sheet as of December 31, 2018: Total (In thousands) Net liabilities $ (313 ) Intangible assets (1) 4,500 Goodwill (2) 6,869 Total purchase price $ 11,056 _________________ (1) Identifiable intangible assets were comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 3,910 4 Customer relationships 590 0.5 Total intangible assets acquired $ 4,500 (2) The goodwill is primarily attributable to the future cash flows to be realized from the operating synergies between the acquired technology platform and the Company's Programmable Wireless products. The Company has filed for the elections that make the goodwill deductible for U.S. tax purposes. |
Purchase price components | The purchase price components, as adjusted, are summarized in the following table: Total (In thousands) Fair value of Class A common stock transferred $ 2,658,898 Fair value of the pre-combination service through equity awards 182,554 Total purchase price, as adjusted $ 2,841,452 |
Schedule of identifiable finite-lived intangible assets | (1) Identifiable intangible assets are comprised of the following: Total Estimated (In thousands) (In years) Developed technology $ 294,000 7 Customer relationships 169,000 7 Trade names 20,000 5 Total intangible assets acquired $ 483,000 |
Schedule of pro forma information | The following table presents the pro forma condensed combined financial information: Year Ended December 31, 2019 2018 (Unaudited, in thousands) Revenue $ 1,148,214 $ 796,607 Net loss attributable to common stockholders $ (322,030 ) $ (211,705 ) |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill balance | Goodwill balance as of December 31, 2019 and 2018 , was as follows: Total (In thousands) Balance as of December 31, 2017 $ 17,851 Goodwill additions related to 2018 acquisitions 20,356 Measurement period adjustments 571 Effect of exchange rate (613 ) Balance as of December 31, 2018 $ 38,165 Goodwill additions related to 2019 acquisitions 2,262,622 Measurement period adjustments (4,003 ) Balance as of December 31, 2019 $ 2,296,784 |
Schedule of intangible assets | Intangible assets consisted of the following: As of Gross Accumulated Net Amortizable intangible assets: (In thousands) Developed technology $ 333,980 $ (55,390 ) $ 278,590 Customer relationships 182,339 (26,347 ) 155,992 Supplier relationships 4,356 (1,532 ) 2,824 Trade names 20,060 (3,727 ) 16,333 Patent 2,707 (262 ) 2,445 Total amortizable intangible assets 543,442 (87,258 ) 456,184 Non-amortizable intangible assets: Telecommunication licenses 4,370 — 4,370 Domain names 32 — 32 Trademarks and other 263 — 263 Total $ 548,107 $ (87,258 ) $ 460,849 As of Gross Accumulated Net Amortizable intangible assets: (In thousands) Developed technology $ 28,209 $ (10,497 ) $ 17,712 Customer relationships 8,153 (2,411 ) 5,742 Supplier relationships 2,696 (973 ) 1,723 Trade name 60 (60 ) — Patent 2,264 (178 ) 2,086 Total amortizable intangible assets 41,382 (14,119 ) 27,263 Non-amortizable intangible assets: Domain names 32 — 32 Trademarks 263 — 263 Total $ 41,677 $ (14,119 ) $ 27,558 |
Schedule of total estimated future amortization expense | Total estimated future amortization expense is as follows: As of Year Ended December 31, (In thousands) 2020 $ 81,419 2021 79,785 2022 77,170 2023 73,888 2024 68,359 Thereafter 75,563 Total $ 456,184 |
Accrued Expenses and Other Li_2
Accrued Expenses and Other Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accrued Liabilities and Other Liabilities [Abstract] | |
Schedule of accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of the following: As of December 31, 2019 2018 (In thousands) Accrued payroll and related $ 20,462 $ 9,886 Accrued bonus and commission 12,898 8,564 Accrued cost of revenue 47,563 29,901 Sales and other taxes payable 28,592 23,631 ESPP contributions 4,023 2,672 Deferred rent — 1,418 VAT and other taxes 4,838 2,217 Acquisition holdback 6,520 — Accrued other expense 22,785 18,054 Total accrued expenses and other current liabilities $ 147,681 $ 96,343 |
Schedule of other long-term liabilities | Other long-term liabilities consisted of the following: As of December 31, 2019 2018 (In thousands) Deferred rent $ — $ 7,569 Deferred tax liability 7,535 5,181 Acquisition holdback 3,750 2,290 Capital lease obligation — 2,170 Accrued other expenses 6,462 959 Total other long-term liabilities $ 17,747 $ 18,169 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Long-term Debt, Unclassified [Abstract] | |
Schedule of net carrying amount of the liability and equity components of the Notes | The net carrying amount of the liability component of the Notes was as follows: As of December 31, 2019 2018 (In thousands) Principal $ 549,999 $ 550,000 Unamortized discount (84,647 ) (106,484 ) Unamortized issuance costs (7,162 ) (9,020 ) Net carrying amount $ 458,190 $ 434,496 The net carrying amount of the equity component of the Notes was as follows: As of December 31, 2019 2018 (In thousands) Proceeds allocated to the conversion options (debt discount) $ 119,435 $ 119,435 Issuance costs (2,819 ) (2,819 ) Net carrying amount $ 116,616 $ 116,616 |
Schedule of interest expense recognized related to the Notes | The following table sets forth the interest expense recognized related to the Notes: Year Ended December 31, 2019 2018 (In thousands) Contractual interest expense $ 1,375 $ 852 Amortization of debt issuance costs 1,858 1,102 Amortization of debt discount 21,838 12,951 Total interest expense related to the Notes $ 25,071 $ 14,905 |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Schedule of the allowance for doubtful accounts | Allowance for doubtful accounts: Year Ended December 31, 2019 2018 2017 (In thousands) Balance, beginning of period $ 4,945 $ 1,033 $ 1,076 Additions 2,226 4,085 580 Write-offs (884 ) (173 ) (623 ) Balance, end of period $ 6,287 $ 4,945 $ 1,033 Percentage of revenue 1 % 1 % — % |
Schedule of the sales credit reserve | Sales credit reserve: Year Ended December 31, 2019 2018 2017 (In thousands) Balance, beginning of period $ 3,015 $ 1,761 $ 544 Additions 18,143 5,560 2,531 Deductions against reserve (14,374 ) (4,306 ) (1,314 ) Balance, end of period $ 6,784 $ 3,015 $ 1,761 Percentage of revenue 1 % — % — % |
Revenue by Geographic Area (Tab
Revenue by Geographic Area (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of revenue by geographic area | Revenue by geographic area is based on the IP address or the mailing address at the time of registration. The following table sets forth revenue by geographic area: Year Ended December 31, 2019 2018 2017 Revenue by geographic area: (In thousands) United States $ 808,857 $ 484,809 $ 308,612 International 325,611 165,258 90,408 Total $ 1,134,468 $ 650,067 $ 399,020 Percentage of revenue by geographic area: United States 71 % 75 % 77 % International 29 % 25 % 23 % |
Commitments and Contingencies C
Commitments and Contingencies Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Unrecorded Unconditional Purchase Obligations Disclosure | Future minimum payments under these noncancelable purchase commitments were as follows. Unrecognized tax benefits are not included in these amounts because any amounts expected to be settled in cash are not material: As of Year Ending December 31, (In thousands) 2020 $ 62,444 2021 50,813 2022 2,855 2023 3,750 2024 — Thereafter — Total payments $ 119,862 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Schedule of reserved shares of common stock for issuance | The Company had reserved shares of common stock for issuance as follows: As of December 31, 2019 2018 Stock options issued and outstanding 7,705,848 7,978,369 Nonvested restricted stock units issued and outstanding 8,490,517 8,262,902 Class A common stock reserved for Twilio.org 795,673 572,676 Stock-based awards available for grant under 2016 Plan 14,957,734 9,313,354 Stock-based awards available for grant under 2016 ESPP 3,848,953 3,092,779 Class A common stock reserved for the convertible senior notes 10,472,165 10,472,165 Total 46,270,890 39,692,245 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation | |
Schedule of weighted average grant date fair value | Year Ended December 31, 2019 2018 2017 (In thousands, except per share amounts) Aggregate intrinsic value of stock options exercised (1) $ 394,998 $ 178,504 $ 131,955 Total estimated grant date fair value of options vested $ 81,292 $ 21,761 $ 15,831 Weighted-average grant date fair value per share of options granted $ 58.13 $ 18.40 $ 13.33 _________ (1) Aggregate intrinsic value represents the difference between the fair value of the Company’s Class A common stock as reported on the New York Stock Exchange and the exercise price of outstanding “in-the-money” options. |
Schedule of restricted stock unit activity | Number of Weighted- Aggregate Nonvested RSUs as of December 31, 2018 8,262,902 $ 42.70 $ 729,373 Granted 3,413,404 119.04 Assumed in acquisition 561,999 112.88 Vested (2,893,119 ) 51.15 Forfeited and canceled (854,669 ) $ 61.94 Nonvested RSUs as of December 31, 2019 8,490,517 $ 74.21 $ 830,167 |
Schedule of valuation assumptions, options | The following assumptions were used in the Monte Carlo simulation model to estimate the grant date fair value and the derived service period of the performance options: Asset volatility 40% Equity volatility 45% Discount rate 14% Stock price at grant date $31.7 |
Schedule of valuation assumptions, ESOP | Year Ended December 31, Employee Stock Purchase Plan: 2019 2018 2017 Expected term (in years) 0.49 - 0.50 0.5 0.5 Expected volatility 43.1% - 50.3% 39.8% - 47.5% 33.2% - 33.9% Risk-free interest rate 1.6% - 2.4% 2.1% - 2.5% 1.1% - 1.4% Dividend rate —% —% —% |
Schedule of stock based compensation expense | The Company recorded the total stock-based compensation expense as follows. In the year ended December 31, 2019 , the stock-based compensation expense associated with awards assumed in the SendGrid acquisition was $81.8 million . Year Ended December 31, 2019 2018 2017 (In thousands) Cost of revenue $ 7,123 $ 1,126 $ 650 Research and development 126,012 42,277 22,808 Sales and marketing 60,886 23,616 9,822 General and administrative 70,297 26,254 16,339 Total $ 264,318 $ 93,273 $ 49,619 |
Employee and nonemployee stock options | |
Stock-Based Compensation | |
Schedule of stock options activity | Number of Weighted- Weighted- Aggregate Outstanding options as of December 31, 2018 7,423,369 $ 16.07 6.80 $ 543,640 Granted 909,229 118.35 Assumed in acquisition 2,978,555 14.91 Exercised (3,620,866 ) 10.43 Forfeited and canceled (539,439 ) 51.28 Outstanding options as of December 31, 2019 7,150,848 $ 28.79 6.47 $ 511,971 Options vested and exercisable as of December 31, 2019 4,721,801 $ 14.00 5.65 $ 398,490 |
Performance-based stock options | |
Stock-Based Compensation | |
Schedule of stock options activity | The following table summarizes the details of the performance options: Number of Weighted- Weighted- Aggregate Outstanding options as of December 31, 2018 555,000 $ 31.72 6.00 $ — Granted — — Exercised — — Forfeited and canceled — — Outstanding options as of December 31, 2019 555,000 $ 31.72 4.16 $ 36,941 Options vested and exercisable as of December 31, 2019 427,812 $ 31.72 4.16 $ 28,475 |
Employee stock options | |
Stock-Based Compensation | |
Schedule of valuation assumptions, options | The fair value of employee stock options was estimated on the date of grant using the following assumptions in the Black-Scholes option pricing model: Year Ended December 31, Employee Stock Options: 2019 2018 2017 Fair value of common stock $103.70 - $130.70 $33.01 - $76.63 $23.60 - $31.96 Expected term (in years) 0.33 - 6.08 1.00 - 6.08 6.08 Expected volatility 49.0% - 66.5% 38.6% - 44.2% 44.3% - 47.6% Risk-free interest rate 1.6% - 2.5% 2.9% - 3.0% 1.9% - 2.3% Dividend rate —% —% —% |
Net Loss Per Share Attributab_2
Net Loss Per Share Attributable to Common Stockholders (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of the calculation of basic and diluted net loss per share attributable to common stockholders | The following table sets forth the calculation of basic and diluted net loss per share attributable to common stockholders during the periods presented: Year Ended December 31, 2019 2018 2017 (In thousands, except share and per share data) Net loss attributable to common stockholders $ (307,063 ) $ (121,949 ) $ (63,708 ) Weighted-average shares used to compute net loss per share attributable to 130,083,046 97,130,339 91,224,607 Net loss per share attributable to common stockholders, basic and diluted $ (2.36 ) $ (1.26 ) $ (0.70 ) |
Schedule of common stock equivalents excluded from the computation of the diluted net loss per share attributable to common stockholders | The following outstanding shares of common stock equivalents were excluded from the calculation of the diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive: As of December 31, 2019 2018 2017 Stock options issued and outstanding 7,705,848 7,978,369 10,710,427 Nonvested restricted stock units issued and outstanding 8,490,517 8,262,902 5,665,459 Class A common stock reserved for Twilio.org 795,673 572,676 635,014 Class A common stock committed under 2016 ESPP 207,792 113,312 235,372 Conversion spread (1) 3,150,647 233 — Unvested shares subject to repurchase — 1,250 5,214 Total 20,350,477 16,928,742 17,251,486 _________ (1) Since the Company expects to settle the principal amount of its outstanding convertible senior notes in cash and any excess in shares of the Company's Class A common stock, the Company uses the treasury stock method for calculating any potential dilutive effect of the conversion spread on diluted net income per share, if applicable. The conversion spread will have a dilutive impact on diluted net income per share of Class A common stock when the average market price of the Company's Class A common stock for a given period exceeds the conversion price of $70.90 |
Income Taxes Income Taxes (Tabl
Income Taxes Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The following table presents domestic and foreign components of loss before income taxes for the periods presented: Year Ended December 31, 2019 2018 2017 (In thousands) United States $ (328,902 ) $ (96,448 ) $ (46,737 ) International (33,314 ) (24,710 ) (16,266 ) Loss before provision for income taxes $ (362,216 ) $ (121,158 ) $ (63,003 ) |
Schedule of Components of Income Tax Expense (Benefit) | Provision for income taxes consists of the following: Year Ended December 31, 2019 2018 2017 Current: (In thousands) Federal $ — $ — $ 99 State 198 139 78 Foreign 2,684 881 823 Total 2,882 1,020 1,000 Deferred: Federal (49,393 ) 29 28 State (7,474 ) 19 10 Foreign (1,168 ) (277 ) (333 ) Total (58,035 ) (229 ) (295 ) Income tax provision (benefit) $ (55,153 ) $ 791 $ 705 |
Schedule of Effective Income Tax Rate Reconciliation | The following table presents a reconciliation of the statutory federal tax rate and the Company's effective tax rate: Year Ended December 31, 2019 2018 2017 Tax benefit at federal statutory rate 21 % 21 % 34 % State tax, net of federal benefit 8 15 10 Stock-based compensation 14 31 47 Credits 4 8 8 Foreign rate differential (2 ) (4 ) (8 ) Change in valuation allowance (29 ) (68 ) (46 ) Change in federal statutory rate — — (45 ) Other (1 ) (3 ) (1 ) Effective tax rate 15 % — % (1 )% |
Schedule of Deferred Tax Assets and Liabilities | The following table presents the significant components of the Company's deferred tax assets and liabilities: As of December 31, 2019 2018 2017 Deferred tax assets: (In thousands) Net operating loss carryforwards $ 274,116 $ 116,190 $ 56,138 Accrued and prepaid expenses 11,828 11,594 9,140 Stock-based compensation 35,035 11,147 7,131 Research and development credits 65,955 32,206 16,212 Charitable contributions 3,172 3,100 1,233 Capped call 9,914 13,175 — Debt issuance cost 493 638 — Depreciable property 2 — — Lease liability 39,117 — — Other — 194 472 Gross deferred tax assets 439,632 188,244 90,326 Valuation allowance (255,893 ) (147,354 ) (78,900 ) Net deferred tax assets 183,739 40,890 11,426 Deferred tax liabilities: Capitalized software (13,032 ) (10,686 ) (7,664 ) Prepaid expenses (1,157 ) (838 ) (1,015 ) Acquired intangibles (107,281 ) (2,997 ) (2,101 ) Property and equipment (1,578 ) (1,990 ) (2,380 ) Convertible debt (20,745 ) (27,164 ) — Right-of-use asset (39,630 ) — — Deferred commissions (7,446 ) (2,396 ) (718 ) Other (405 ) — — Net deferred tax liability $ (7,535 ) $ (5,181 ) $ (2,452 ) |
Summary of Operating Loss Carryforwards | The following table summarizes our tax carryforwards, carryovers, and credits: As of Expiration Date (In thousands) Federal net operating loss carryforwards $ 1,159,329 Various dates beginning in 2029 Federal tax credits $ 58,404 Various dates beginning in 2029 Federal net operating loss carryforwards $ 902,507 Indefinite State net operating loss carryforwards $ 630,151 Various dates beginning in 2025 State tax credits $ 38,817 Indefinite Foreign net operating loss carryforwards $ 13,772 Indefinite |
Summary of Tax Credit Carryforwards | The following table summarizes our tax carryforwards, carryovers, and credits: As of Expiration Date (In thousands) Federal net operating loss carryforwards $ 1,159,329 Various dates beginning in 2029 Federal tax credits $ 58,404 Various dates beginning in 2029 Federal net operating loss carryforwards $ 902,507 Indefinite State net operating loss carryforwards $ 630,151 Various dates beginning in 2025 State tax credits $ 38,817 Indefinite Foreign net operating loss carryforwards $ 13,772 Indefinite |
Schedule of Unrecognized Tax Benefits Roll Forward | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Year Ended December 31, 2019 2018 2017 (In thousands) Unrecognized tax benefit, beginning of year $ 15,635 $ 9,445 $ 12,275 Gross increases for tax positions of prior years 12,939 1,233 493 Gross decrease for tax positions of prior years (395 ) (4 ) (6,331 ) Gross increases for tax positions of current year 20,863 4,961 3,008 Unrecognized tax benefit, end of year $ 49,042 $ 15,635 $ 9,445 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Deferred Sales Commissions | |||
Accumulated deficit | $ (678,812) | $ (371,674) | |
Deferred revenue | 26,400 | 23,000 | |
Revenue recognized out of adjusted deferred revenue balance | $ 18,700 | $ 10,600 | |
Incremental commission costs of obtaining new contracts | |||
Deferred Sales Commissions | |||
Amortization period for deferred incremental commission costs of obtaining new contracts | 5 years | ||
Subscription-based fees | |||
Deferred Sales Commissions | |||
Percent of revenue | 75.00% | 84.00% | 83.00% |
Usage-based fees | |||
Deferred Sales Commissions | |||
Percent of revenue | 25.00% | 16.00% | 17.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Deferred Sales Commissions (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Deferred Sales Commissions | ||
Total net capitalized costs | $ 30.4 | $ 9.4 |
Amortization of capitalized costs of obtaining a contract | $ 4.5 | $ 1.4 |
Incremental commission costs of obtaining new contracts | ||
Deferred Sales Commissions | ||
Amortization period for deferred incremental commission costs of obtaining new contracts | 5 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies Summary of Significant Accounting Policies - Narrative (Details) | 12 Months Ended | |||||
Dec. 31, 2019USD ($)Vote | Dec. 31, 2018USD ($)Vote | Dec. 31, 2017USD ($) | Feb. 01, 2019USD ($) | Jan. 01, 2019USD ($) | Dec. 31, 2016USD ($) | |
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Advertising expense | $ 27,000,000 | $ 10,600,000 | $ 4,900,000 | |||
Allowance for doubtful accounts | 6,287,000 | 4,945,000 | 1,033,000 | $ 1,076,000 | ||
Issuance costs | 953,000 | |||||
Operating lease assets | 156,741,000 | $ 123,500,000 | ||||
Operating lease, liability | 166,356,000 | 132,000,000 | ||||
Deferred rent credit | $ 9,000,000 | |||||
Goodwill, impairment loss | 0 | 0 | 0 | |||
Impairment of long-lived assets | 0 | $ 0 | $ 0 | |||
SendGrid | ||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Operating right of use asset | 33,742,000 | $ 33,700,000 | ||||
Operating lease liability | 32,568,000 | 32,600,000 | ||||
Finance right-of-use assets | 14,200,000 | |||||
Finance lease liability | $ 13,616,000 | $ 13,600,000 | ||||
Common Class A | ||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Votes per share | Vote | 1 | 1 | ||||
Common Class B | ||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Votes per share | Vote | 10 | 10 | ||||
Conversion ratio | 1 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies Summary of Significant Accounting Policies - Useful Lives (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Capitalized internal-use software development costs | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 3 years |
Data center equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 2 years |
Data center equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 4 years |
Office equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 3 years |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 5 years |
Software | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 3 years |
Assets held under capital leases | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 5 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated life | 5 years |
Developed technology | Minimum | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 3 years |
Developed technology | Maximum | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 7 years |
Customer relationships | Minimum | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 2 years |
Customer relationships | Maximum | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 8 years |
Supplier relationships | Minimum | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 2 years |
Supplier relationships | Maximum | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 5 years |
Trade names | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 5 years |
Patent | |
Property, Plant and Equipment [Line Items] | |
Intangible assets, estimated life | 20 years |
Fair Value Measurements - Asset
Fair Value Measurements - Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Aug. 31, 2019 | Dec. 31, 2018 | |
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | $ 189,052,000 | $ 465,217,000 | |
Total amortized cost | 1,594,334,000 | 261,468,000 | |
Marketable securities, accumulated gross unrealized gain, before tax | 4,757,000 | 23,000 | |
Marketable securities, gross unrealized losses less than 12 months | (58,000) | (130,000) | |
Marketable securities, gross unrealized losses more than 12 months | 0 | (233,000) | |
Marketable securities, aggregate fair value | 1,599,033,000 | 261,128,000 | |
Strategic investments | 5,500,000 | ||
Total financial assets, amortized cost or carrying value | 1,788,886,000 | 726,685,000 | |
Total financial assets | 1,793,585,000 | 726,345,000 | |
Note receivable | $ 5,500,000 | ||
Impairment of debt security | 0 | ||
U.S. Treasury securities | |||
Fair Value Measurements, Financial Assets | |||
Total amortized cost | 215,847,000 | 59,785,000 | |
Marketable securities, accumulated gross unrealized gain, before tax | 241,000 | 0 | |
Marketable securities, gross unrealized losses less than 12 months | (3,000) | (7,000) | |
Marketable securities, gross unrealized losses more than 12 months | (9,000) | ||
Marketable securities, aggregate fair value | 216,085,000 | 59,769,000 | |
Corporate debt securities and commercial paper | |||
Fair Value Measurements, Financial Assets | |||
Total amortized cost | 1,378,487,000 | 201,683,000 | |
Marketable securities, accumulated gross unrealized gain, before tax | 4,516,000 | 23,000 | |
Marketable securities, gross unrealized losses less than 12 months | (55,000) | (123,000) | |
Marketable securities, gross unrealized losses more than 12 months | 0 | (224,000) | |
Marketable securities, aggregate fair value | 1,382,948,000 | 201,359,000 | |
Level 1 | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 153,252,000 | 420,234,000 | |
Marketable securities, aggregate fair value | 221,085,000 | 59,769,000 | |
Total financial assets | 374,337,000 | 480,003,000 | |
Level 1 | U.S. Treasury securities | |||
Fair Value Measurements, Financial Assets | |||
Marketable securities, aggregate fair value | 216,085,000 | 59,769,000 | |
Level 1 | Corporate debt securities and commercial paper | |||
Fair Value Measurements, Financial Assets | |||
Marketable securities, aggregate fair value | 5,000,000 | ||
Level 2 | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 35,800,000 | 44,983,000 | |
Marketable securities, aggregate fair value | 1,377,948,000 | 201,359,000 | |
Total financial assets | 1,413,748,000 | 246,342,000 | |
Level 2 | U.S. Treasury securities | |||
Fair Value Measurements, Financial Assets | |||
Marketable securities, aggregate fair value | 0 | 0 | |
Level 2 | Corporate debt securities and commercial paper | |||
Fair Value Measurements, Financial Assets | |||
Marketable securities, aggregate fair value | 1,377,948,000 | 201,359,000 | |
Level 3 | |||
Fair Value Measurements, Financial Assets | |||
Strategic investments | 5,500,000 | ||
Total financial assets | 5,500,000 | 0 | |
Carrying Value | Money market funds | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 153,252,000 | 420,234,000 | |
Carrying Value | Reverse repurchase agreements | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 35,800,000 | 35,000,000 | |
Carrying Value | Commercial Paper | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 9,983,000 | ||
Aggregate Fair Value | Money market funds | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 153,252,000 | 420,234,000 | |
Aggregate Fair Value | Reverse repurchase agreements | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 35,800,000 | 35,000,000 | |
Aggregate Fair Value | Commercial Paper | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 9,983,000 | ||
Aggregate Fair Value | Level 1 | Money market funds | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | 153,252,000 | 420,234,000 | |
Aggregate Fair Value | Level 2 | Reverse repurchase agreements | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | $ 35,800,000 | 35,000,000 | |
Aggregate Fair Value | Level 2 | Commercial Paper | |||
Fair Value Measurements, Financial Assets | |||
Cash and cash equivalents | $ 9,983,000 |
Fair Value Measurements - Marke
Fair Value Measurements - Marketable Securities (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Marketable Securities | |||
Other-than-temporary impairments associated with credit losses | $ 0 | $ 0 | $ 0 |
Interest earned on marketable securities | 20,800,000 | 3,000,000 | $ 2,600,000 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 189,052,000 | 465,217,000 | |
Aggregate Fair Value | Reverse repurchase agreements | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | $ 35,800,000 | $ 35,000,000 |
Fair Value Measurements - Contr
Fair Value Measurements - Contractual Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value Disclosures [Abstract] | ||
Less than one year, amortized cost | $ 859,996 | $ 261,468 |
One to three years, amortized cost | 734,338 | 0 |
Total amortized cost | 1,594,334 | 261,468 |
Less than one year, aggregate fair value | 861,181 | 261,128 |
One to three years, aggregate fair value | 737,852 | 0 |
Total aggregate fair value | $ 1,599,033 | $ 261,128 |
Fair Value Measurements - Conve
Fair Value Measurements - Convertible Senior Notes (Details) - Convertible senior notes, 0.25%, due 2023 - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | May 31, 2018 |
Fair Value Measurements, Liabilities | |||
Interest rate (as a percent) | 0.25% | ||
Level 2 | |||
Fair Value Measurements, Liabilities | |||
Fair value of the notes | $ 841.3 | $ 743.4 |
Property and Equipment - Proper
Property and Equipment - Property and Equipment, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Capitalized internal use software development costs | $ 29,700 | $ 25,300 | $ 21,500 |
Property and Equipment | |||
Total property and equipment | 222,404 | ||
Less: accumulated depreciation and amortization | (81,148) | ||
Total property and equipment, net | 141,256 | ||
Total property and equipment | 108,270 | ||
Less: accumulated depreciation and amortization | (44,736) | ||
Total property and equipment, net | 63,534 | ||
Capitalized internal-use software development costs | |||
Property and Equipment | |||
Total property and equipment | 100,155 | ||
Total property and equipment | 72,647 | ||
Data center equipment | |||
Property and Equipment | |||
Total property and equipment | 22,009 | ||
Total property and equipment | 0 | ||
Leasehold improvements | |||
Property and Equipment | |||
Total property and equipment | 55,886 | ||
Total property and equipment | 15,293 | ||
Office equipment | |||
Property and Equipment | |||
Total property and equipment | 25,083 | ||
Total property and equipment | 13,563 | ||
Furniture and fixtures | |||
Property and Equipment | |||
Total property and equipment | 10,095 | ||
Total property and equipment | 4,918 | ||
Software | |||
Property and Equipment | |||
Total property and equipment | $ 9,176 | ||
Total property and equipment | $ 1,849 |
Property and Equipment - Deprec
Property and Equipment - Depreciation and Amortization Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization | $ 37.5 | $ 18.9 | $ 13.1 |
Property and Equipment - Capita
Property and Equipment - Capitalized Software Development Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||
Capitalized internal use software development costs | $ 29,700 | $ 25,300 | $ 21,500 |
Stock-based compensation capitalized in software development costs | 7,777 | 5,706 | 4,176 |
Amortization of capitalized software development costs | 17,104 | 13,024 | 8,407 |
Cost of revenue | |||
Property, Plant and Equipment [Line Items] | |||
Amortization of capitalized software development costs | 9,546 | 6,898 | 4,788 |
Research and development | |||
Property, Plant and Equipment [Line Items] | |||
Amortization of capitalized software development costs | 7,345 | 5,437 | $ 3,619 |
General and administrative | |||
Property, Plant and Equipment [Line Items] | |||
Amortization of capitalized software development costs | $ 213 | $ 689 |
Right-of-Use Asset and Lease _3
Right-of-Use Asset and Lease Liabilities - Narrative (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)property | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Lessee, Lease, Description [Line Items] | |||
Number of leased properties | property | 22 | ||
Renewal option | 5 years | ||
Operating leases, rent expense | $ 10.3 | $ 8.1 | |
Operating lease, not yet commenced, liability | $ 54.1 | ||
Finance lease not yet commenced, liability | $ 0.7 | ||
Lease not yet commenced, term of contract | 6 years 9 months 18 days | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Term of lease | 2 months 12 days | ||
Operating lease, not yet commenced, term of contract | 3 years | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Term of lease | 9 years | ||
Operating lease, not yet commenced, term of contract | 6 years 9 months 18 days |
Right-of-Use Asset and Lease _4
Right-of-Use Asset and Lease Liabilities - Components of Lease Expense (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 32,558 |
Finance lease cost: | |
Amortization of assets | 6,090 |
Interest on lease liabilities | 708 |
Short-term lease cost | 6,342 |
Variable lease cost | 3,792 |
Total net lease cost | $ 49,490 |
Right-of-Use Asset and Lease _5
Right-of-Use Asset and Lease Liabilities - Balance Sheet Classification of Lease Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 |
ASSETS | ||
Operating lease assets | $ 156,741 | $ 123,500 |
Finance lease assets | 14,770 | |
Total leased assets | 171,511 | |
Current liabilities: | ||
Operating | 27,156 | |
Finance | 6,924 | |
Noncurrent liabilities | ||
Operating | 139,200 | |
Finance | 8,746 | |
Total lease liabilities | 182,026 | |
Operating lease accumulated amortization | 23,200 | |
Finance lease accumulated depreciation | $ 6,000 |
Right-of-Use Asset and Lease _6
Right-of-Use Asset and Lease Liabilities - Supplemental Cash Flows (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 28,291 |
Operating cash flows from finance leases (interest) | 687 |
Financing cash flows from finance leases | $ 5,646 |
Weighted Average Remaining Lease Term [Abstract] | |
Operating leases | 6 years 1 month 6 days |
Finance leases | 3 years |
Weighted Average Discount Rate [Abstract] | |
Operating leases | 5.50% |
Finance leases | 5.30% |
Right-of-Use Asset and Lease _7
Right-of-Use Asset and Lease Liabilities - Lease Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 |
Maturity Of Operating Lease Liabilities | ||
2020 | $ 35,997 | |
2021 | 34,762 | |
2022 | 33,214 | |
2023 | 27,859 | |
2024 | 25,400 | |
Thereafter | 43,125 | |
Total lease payments | 200,357 | |
Less: imputed interest | (34,001) | |
Total lease obligations | 166,356 | $ 132,000 |
Less: current obligations | (27,156) | |
Long-term lease obligations | 139,200 | |
Maturity Of Finance Lease Liabilities | ||
2020 | 7,586 | |
2021 | 4,659 | |
2022 | 2,333 | |
2023 | 1,581 | |
2024 | 315 | |
Thereafter | 581 | |
Total lease payments | 17,055 | |
Less: imputed interest | (1,385) | |
Total lease obligations | 15,670 | |
Less: current obligations | (6,924) | |
Long-term lease obligations | $ 8,746 |
Right-of-Use Asset and Lease _8
Right-of-Use Asset and Lease Liabilities - Lease Maturities Prior To Adoption of New Lease Standard (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Operating Leases | |
2019 | $ 24,128 |
2020 | 29,527 |
2021 | 30,898 |
2022 | 30,492 |
2023 | 30,122 |
Thereafter | 81,316 |
Total minimum lease payments | 226,483 |
Finance Leases | |
2019 | 306 |
2020 | 512 |
2021 | 573 |
2022 | 590 |
2023 | 608 |
Thereafter | 1,939 |
Total minimum lease payments | $ 4,528 |
Business Combinations - Conside
Business Combinations - Consideration (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | 11 Months Ended | 12 Months Ended | 24 Months Ended | ||||||
Jun. 30, 2019 | Feb. 28, 2019 | Sep. 30, 2018 | Aug. 31, 2018 | Feb. 28, 2017 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2017 | |
Acquisition | |||||||||||
Value of common stock issued and stock awards assumed in acquisition | $ (4,003) | $ 571 | |||||||||
Fair value of the pre-combination service through equity awards | 182,554 | ||||||||||
Release of valuation allowance on deferred tax assets | 48,000 | ||||||||||
Goodwill | $ 2,296,784 | 2,296,784 | 38,165 | $ 17,851 | $ 17,851 | ||||||
Other Acquisitions | |||||||||||
Acquisition | |||||||||||
Consideration transferred | 43,200 | ||||||||||
Amount of purchase price placed into an escrow account | 9,100 | ||||||||||
Acquisition related costs | 1,900 | ||||||||||
Fair value of Class A common stock transferred | 12,800 | ||||||||||
Goodwill | 23,425 | 23,425 | |||||||||
Expected tax deductible amount | 6,800 | 6,800 | |||||||||
SendGrid | |||||||||||
Acquisition | |||||||||||
Consideration transferred | $ 2,841,452 | ||||||||||
Shares issuable as part of acquisition (in shares) | 23,600,000 | ||||||||||
Goodwill, purchase accounting adjustments, net | (4,400) | ||||||||||
Acquisition related costs | 40,800 | 13,900 | |||||||||
Fair value of Class A common stock transferred | $ 2,658,898 | ||||||||||
Fair value of the pre-combination service through equity awards | $ 182,554 | ||||||||||
Release of valuation allowance on deferred tax assets | $ 55,000 | 47,900 | |||||||||
Revenues | 177,100 | ||||||||||
Goodwill | $ 2,235,193 | 2,235,193 | |||||||||
Ytica | |||||||||||
Acquisition | |||||||||||
Payments to acquire businesses, gross | $ 21,800 | ||||||||||
Consideration transferred | 21,800 | ||||||||||
Amount of purchase price placed into an escrow account | $ 3,200 | ||||||||||
Escrow effective period | 18 months | ||||||||||
Acquisition related costs | $ 600 | ||||||||||
Goodwill | $ 13,375 | ||||||||||
Core Network Dynamics Gmbh | |||||||||||
Acquisition | |||||||||||
Payments to acquire businesses, gross | $ 11,100 | ||||||||||
Consideration transferred | 11,100 | ||||||||||
Amount of purchase price placed into an escrow account | $ 2,000 | ||||||||||
Escrow effective period | 18 months | ||||||||||
Acquisition related costs | $ 800 | ||||||||||
Goodwill | $ 6,869 | ||||||||||
Beepsend | |||||||||||
Acquisition | |||||||||||
Payments to acquire businesses, gross | $ 23,000 | ||||||||||
Consideration transferred | 23,000 | ||||||||||
Amount of purchase price placed into an escrow account | $ 5,000 | ||||||||||
Escrow effective period | 18 months | ||||||||||
Acquisition related costs | $ 300 | $ 700 | |||||||||
Goodwill | $ 12,837 | ||||||||||
General and administrative | SendGrid | |||||||||||
Acquisition | |||||||||||
Acquisition related costs | $ 13,900 | ||||||||||
Minimum | Other Acquisitions | |||||||||||
Acquisition | |||||||||||
Escrow effective period | 18 months | ||||||||||
Maximum | Other Acquisitions | |||||||||||
Acquisition | |||||||||||
Escrow effective period | 36 months | ||||||||||
Restricted Stock | Common Class A | Ytica | |||||||||||
Acquisition | |||||||||||
Shares granted (in shares) | 47,574 | ||||||||||
Aggregate grant value | $ 3,600 | ||||||||||
Restricted Stock | Common Class A | Core Network Dynamics Gmbh | |||||||||||
Acquisition | |||||||||||
Shares granted (in shares) | 35,950 | ||||||||||
Aggregate grant value | $ 2,200 | ||||||||||
Weighted average remaining contractual term | 3 years |
Business Combinations - Purchas
Business Combinations - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Feb. 28, 2019 | Feb. 01, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Aug. 31, 2018 | Dec. 31, 2017 | Feb. 28, 2017 |
Acquisition | ||||||||
Goodwill | $ 2,296,784 | $ 38,165 | $ 17,851 | |||||
Other Acquisitions | ||||||||
Acquisition | ||||||||
Net liabilities | (3,219) | |||||||
Intangible assets | 22,986 | |||||||
Goodwill | 23,425 | |||||||
Total purchase price | 43,192 | |||||||
SendGrid | ||||||||
Acquisition | ||||||||
Cash and cash equivalents | 156,783 | |||||||
Accounts receivable and other current assets | 11,635 | |||||||
Property and equipment, net | 38,350 | |||||||
Operating right of use asset | 33,742 | $ 33,700 | ||||||
Intangible assets | 483,000 | |||||||
Other assets | 1,664 | |||||||
Goodwill | 2,235,193 | |||||||
Accounts payable and other liabilities | 11,114 | |||||||
Operating lease liability | (32,568) | (32,600) | ||||||
Financing lease liability | (13,616) | $ (13,600) | ||||||
Note payable | (5,387) | |||||||
Deferred tax liability | (56,230) | $ (56,200) | ||||||
Total purchase price | 2,841,452 | |||||||
Ytica | ||||||||
Acquisition | ||||||||
Net liabilities | (1,538) | |||||||
Intangible assets | 9,920 | |||||||
Goodwill | 13,375 | |||||||
Deferred tax liability | $ (1,700) | |||||||
Total purchase price | 21,757 | |||||||
Core Network Dynamics Gmbh | ||||||||
Acquisition | ||||||||
Net liabilities | $ (313) | |||||||
Intangible assets | 4,500 | |||||||
Goodwill | 6,869 | |||||||
Deferred tax liability | (1,200) | |||||||
Total purchase price | 11,056 | |||||||
Beepsend | ||||||||
Acquisition | ||||||||
Net liabilities | $ (3,575) | |||||||
Intangible assets | 13,700 | |||||||
Goodwill | 12,837 | |||||||
Deferred tax liability | (2,600) | |||||||
Total purchase price | 22,962 | |||||||
Developed technology | Other Acquisitions | ||||||||
Acquisition | ||||||||
Intangible assets | 11,771 | |||||||
Developed technology | SendGrid | ||||||||
Acquisition | ||||||||
Intangible assets | $ 294,000 | |||||||
Developed technology | Ytica | ||||||||
Acquisition | ||||||||
Intangible assets | $ 9,090 | |||||||
Developed technology | Core Network Dynamics Gmbh | ||||||||
Acquisition | ||||||||
Intangible assets | $ 3,910 | |||||||
Developed technology | Beepsend | ||||||||
Acquisition | ||||||||
Intangible assets | $ 5,000 |
Business Combinations - Identif
Business Combinations - Identifiable Finite-lived Intangible Assets (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Feb. 28, 2019 | Sep. 30, 2018 | Aug. 31, 2018 | Feb. 28, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | |
Trade names | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 5 years | |||||
Other Acquisitions | ||||||
Acquisitions | ||||||
Intangible assets | $ 22,986 | |||||
Other Acquisitions | Telecommunication licenses | ||||||
Acquisitions | ||||||
Intangible assets | 4,370 | |||||
Other Acquisitions | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets | 11,771 | |||||
Other Acquisitions | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets | 5,185 | |||||
Other Acquisitions | Supplier relationships | ||||||
Acquisitions | ||||||
Intangible assets | 1,660 | |||||
SendGrid | ||||||
Acquisitions | ||||||
Intangible assets | 483,000 | |||||
SendGrid | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets | 294,000 | |||||
Intangible assets, estimated life | 7 years | |||||
SendGrid | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets | 169,000 | |||||
Intangible assets, estimated life | 7 years | |||||
SendGrid | Trade names | ||||||
Acquisitions | ||||||
Intangible assets | $ 20,000 | |||||
Intangible assets, estimated life | 5 years | |||||
Ytica | ||||||
Acquisitions | ||||||
Intangible assets | $ 9,920 | |||||
Ytica | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets | 9,090 | |||||
Intangible assets, estimated life | 4 years | |||||
Ytica | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets | $ 830 | |||||
Intangible assets, estimated life | 2 years | |||||
Core Network Dynamics Gmbh | ||||||
Acquisitions | ||||||
Intangible assets | $ 4,500 | |||||
Core Network Dynamics Gmbh | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets | $ 3,910 | |||||
Intangible assets, estimated life | 4 years | |||||
Core Network Dynamics Gmbh | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets | $ 590 | |||||
Intangible assets, estimated life | 6 months | |||||
Beepsend | ||||||
Acquisitions | ||||||
Intangible assets | $ 13,700 | |||||
Beepsend | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets | $ 5,000 | |||||
Intangible assets, estimated life | 4 years | |||||
Beepsend | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets | $ 6,100 | |||||
Beepsend | Supplier relationships | ||||||
Acquisitions | ||||||
Intangible assets | $ 2,600 | |||||
Intangible assets, estimated life | 5 years | |||||
Minimum | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 3 years | |||||
Minimum | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 2 years | |||||
Minimum | Supplier relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 2 years | |||||
Minimum | Other Acquisitions | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 4 years | |||||
Minimum | Other Acquisitions | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 3 years | |||||
Minimum | Other Acquisitions | Supplier relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 2 years | |||||
Minimum | Beepsend | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 7 years | |||||
Maximum | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 7 years | |||||
Maximum | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 8 years | |||||
Maximum | Supplier relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 5 years | |||||
Maximum | Other Acquisitions | Developed technology | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 6 years | |||||
Maximum | Other Acquisitions | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 5 years | |||||
Maximum | Beepsend | Customer relationships | ||||||
Acquisitions | ||||||
Intangible assets, estimated life | 8 years |
Business Combinations - Pro For
Business Combinations - Pro Forma Information (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | ||||
Release of valuation allowance on deferred tax assets | $ 48,000 | |||
Valuation allowance | 55,745 | $ 0 | $ 0 | |
Unrecognized tax benefits, ongoing | 29,400 | |||
Revenue | 1,148,214 | 796,607 | ||
Net loss attributable to common stockholders | (322,030) | (211,705) | ||
SendGrid | ||||
Business Acquisition [Line Items] | ||||
Acquisition related costs | 40,800 | 13,900 | ||
Release of valuation allowance on deferred tax assets | $ 55,000 | 47,900 | ||
Valuation allowance | $ 53,500 | |||
SendGrid | General and administrative | ||||
Business Acquisition [Line Items] | ||||
Acquisition related costs | $ 13,900 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Goodwill Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill | ||
Balance (beginning of period) | $ 38,165 | $ 17,851 |
Goodwill additions related to acquisitions | 2,262,622 | 20,356 |
Measurement period adjustments | (4,003) | 571 |
Effect of exchange rate | (613) | |
Balance (end of period) | $ 2,296,784 | $ 38,165 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Amortizable intangible assets: | ||
Gross | $ 543,442 | $ 41,382 |
Accumulated Amortization | (87,258) | (14,119) |
Net | 456,184 | 27,263 |
Intangible assets, gross | 548,107 | 41,677 |
Total | 460,849 | 27,558 |
Telecommunication licenses | ||
Amortizable intangible assets: | ||
Non-amortizable intangible assets: | 4,370 | |
Domain names | ||
Amortizable intangible assets: | ||
Non-amortizable intangible assets: | 32 | 32 |
Trademarks | ||
Amortizable intangible assets: | ||
Non-amortizable intangible assets: | 263 | 263 |
Developed technology | ||
Amortizable intangible assets: | ||
Gross | 333,980 | 28,209 |
Accumulated Amortization | (55,390) | (10,497) |
Net | 278,590 | 17,712 |
Customer relationships | ||
Amortizable intangible assets: | ||
Gross | 182,339 | 8,153 |
Accumulated Amortization | (26,347) | (2,411) |
Net | 155,992 | 5,742 |
Supplier relationships | ||
Amortizable intangible assets: | ||
Gross | 4,356 | 2,696 |
Accumulated Amortization | (1,532) | (973) |
Net | 2,824 | 1,723 |
Trade names | ||
Amortizable intangible assets: | ||
Gross | 20,060 | 60 |
Accumulated Amortization | (3,727) | (60) |
Net | 16,333 | 0 |
Patent | ||
Amortizable intangible assets: | ||
Gross | 2,707 | 2,264 |
Accumulated Amortization | (262) | (178) |
Net | $ 2,445 | $ 2,086 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 72,907 | $ 7,242 | $ 5,675 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Total Estimated Future Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Intangible Assets | ||
2020 | $ 81,419 | |
2021 | 79,785 | |
2022 | 77,170 | |
2023 | 73,888 | |
2024 | 68,359 | |
Thereafter | 75,563 | |
Net | $ 456,184 | $ 27,263 |
Accrued Expenses and Other Li_3
Accrued Expenses and Other Liabilities - Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Accrued payroll and related | $ 20,462 | $ 9,886 |
Accrued bonus and commission | 12,898 | 8,564 |
Accrued cost of revenue | 47,563 | 29,901 |
Sales and other taxes payable | 28,592 | 23,631 |
ESPP contributions | 4,023 | 2,672 |
Deferred rent | 0 | 1,418 |
VAT and other taxes | 4,838 | 2,217 |
Acquisition holdback | 6,520 | 0 |
Accrued other expense | 22,785 | 18,054 |
Total accrued expenses and other current liabilities | $ 147,681 | $ 96,343 |
Accrued Expenses and Other Li_4
Accrued Expenses and Other Liabilities - Long-term Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Accrued Liabilities and Other Liabilities [Abstract] | ||
Deferred rent | $ 0 | $ 7,569 |
Deferred tax liability | 7,535 | 5,181 |
Acquisition holdback | 3,750 | 2,290 |
Finance | 2,170 | |
Accrued other expenses | 6,462 | 959 |
Total other long-term liabilities | $ 17,747 | $ 18,169 |
Notes Payable - Issuance (Detai
Notes Payable - Issuance (Details) - USD ($) | 1 Months Ended | ||
May 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Convertible senior notes, 0.25%, due 2023 | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 549,999,000 | $ 550,000,000 | |
Interest rate (as a percent) | 0.25% | ||
Net proceeds from the debt offering | $ 537,000,000 | ||
Convertible senior notes, 0.25%, due 2023 - over-allotment | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount | $ 75,000,000 |
Notes Payable - Terms (Details)
Notes Payable - Terms (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |
May 31, 2018USD ($)$ / shares | Dec. 31, 2019USD ($)D$ / shares | Dec. 31, 2018USD ($)$ / shares | |
Debt Instrument [Line Items] | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Effective percentage | 5.70% | ||
Common Class A | |||
Debt Instrument [Line Items] | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 |
Convertible senior notes, 0.25%, due 2023 | |||
Debt Instrument [Line Items] | |||
Threshold trading days | D | 20 | ||
Consecutive trading period | D | 30 | ||
Minimum sale price of stock as a percentage of the conversion price | 130.00% | ||
Number of consecutive trading days of threshold Notes trading price for conversion eligibility to follow | D | 5 | ||
Trading price as a percentage of the product of common stock sale price and conversion rate | 98.00% | ||
Percentage of principal amount of the Notes | 100.00% | ||
Interest rate (as a percent) | 0.25% | ||
Carrying amount of equity component | $ | $ 119,435 | $ 119,435 | |
Debt issuance costs | $ | $ 10,200 | $ 7,162 | $ 9,020 |
Convertible senior notes, 0.25%, due 2023 | Common Class A | |||
Debt Instrument [Line Items] | |||
Conversion ratio | 14.104 | ||
Capped calls | |||
Debt Instrument [Line Items] | |||
Initial strike price (in dollars per share) | $ / shares | $ 70.90 |
Notes Payable - Net Carrying Am
Notes Payable - Net Carrying Amount (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | May 31, 2018 | |
Net carrying amount of the equity component of the Notes | |||
Issuance costs | $ (953,000) | ||
Convertible senior notes, 0.25%, due 2023 | |||
Net carrying amount of the liability component of the Notes | |||
Aggregate principal amount | 549,999,000 | $ 550,000,000 | |
Unamortized discount | (84,647,000) | (106,484,000) | |
Unamortized issuance costs | (7,162,000) | (9,020,000) | $ (10,200,000) |
Net carrying amount | 458,190,000 | 434,496,000 | |
Net carrying amount of the equity component of the Notes | |||
Proceeds allocated to the conversion options (debt discount) | 119,435,000 | 119,435,000 | |
Issuance costs | (2,819,000) | (2,819,000) | |
Net carrying amount | $ 116,616,000 | $ 116,616,000 |
Notes Payable - Interest Expens
Notes Payable - Interest Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Interest expense recognized related to the Notes | |||
Amortization of debt issuance costs | $ 23,696 | $ 14,053 | $ 0 |
Convertible senior notes, 0.25%, due 2023 | |||
Interest expense recognized related to the Notes | |||
Contractual interest expense | 1,375 | 852 | |
Amortization of debt issuance costs | 1,858 | 1,102 | |
Amortization of debt discount | 21,838 | 12,951 | |
Total interest expense related to the Notes | $ 25,071 | $ 14,905 |
Notes Payable - Capped Calls (D
Notes Payable - Capped Calls (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
May 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Capped calls | ||||
Net cost to purchase the transactions | $ 0 | $ 58,465 | $ 0 | |
Capped calls | ||||
Capped calls | ||||
Initial strike price (in dollars per share) | $ 70.90 | |||
Initial cap price (in dollars per share) | $ 105.04 | |||
Number of shares covered | 7,757,172 | |||
Net cost to purchase the transactions | $ 58,500 |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Allowance for doubtful accounts | |||
Balance, beginning of period | $ 4,945 | $ 1,033 | $ 1,076 |
Additions | 2,226 | 4,085 | 580 |
Write-offs | (884) | (173) | (623) |
Balance, end of period | $ 6,287 | $ 4,945 | $ 1,033 |
Reserve for allowance for doubtful account | 1.00% | 1.00% | 0.00% |
Supplemental Balance Sheet In_4
Supplemental Balance Sheet Information - Sales Credit Reserve (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Sales credit reserve | |||
Sales credit reserve, percent of revenue | 1.00% | 0.00% | 0.00% |
Sales credit reserve | |||
Sales credit reserve | |||
Balance, beginning of period | $ 3,015 | $ 1,761 | $ 544 |
Additions | 18,143 | 5,560 | 2,531 |
Deductions against reserve | (14,374) | (4,306) | (1,314) |
Balance, end of period | $ 6,784 | $ 3,015 | $ 1,761 |
Revenue by Geographic Area - Re
Revenue by Geographic Area - Revenue by Geographic Area (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue by geographic area: | |||
Revenue | $ 1,134,468 | $ 650,067 | $ 399,020 |
United States | |||
Revenue by geographic area: | |||
Revenue | 808,857 | 484,809 | 308,612 |
International | |||
Revenue by geographic area: | |||
Revenue | $ 325,611 | $ 165,258 | $ 90,408 |
Revenue by Geographic Area - Pe
Revenue by Geographic Area - Percentage of Revenue by Geographic Area (Details) - Revenue from Contract with Customer Benchmark - Geographic Concentration Risk | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
United States | |||
Percentage of revenue by geographic area: | |||
Percentage of revenue (as a percent) | 71.00% | 75.00% | 77.00% |
International | |||
Percentage of revenue by geographic area: | |||
Percentage of revenue (as a percent) | 29.00% | 25.00% | 23.00% |
Commitments and Contingencies -
Commitments and Contingencies - Other Commitments (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Long-term Purchase Commitment [Line Items] | |
2020 | $ 62,444 |
2021 | 50,813 |
2022 | 2,855 |
2023 | 3,750 |
2024 | 0 |
Thereafter | 0 |
Total payments | $ 119,862 |
Minimum | |
Long-term Purchase Commitment [Line Items] | |
Term of lease | 2 months 12 days |
Term of non-cancellable agreement | 1 year |
Maximum | |
Long-term Purchase Commitment [Line Items] | |
Term of lease | 9 years |
Term of non-cancellable agreement | 4 years |
Commitments and Contingencies_2
Commitments and Contingencies - Legal Matters (Details) $ in Millions | Aug. 30, 2019USD ($) | Jan. 07, 2019USD ($) | Jan. 02, 2018classcustomer |
Legal Matters | |||
Settlement awarded to other party | $ 10 | ||
Payments for legal settlements | $ 1.7 | ||
Pending Litigation | |||
Legal Matters | |||
Number of classes of individuals who allegedly sent or received certain communications | class | 2 | ||
Number of customers' accounts involved in the complaint | customer | 3 |
Commitments and Contingencies_3
Commitments and Contingencies - Indemnification Agreements (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Indemnification Agreements | ||
Loss Contingencies [Line Items] | ||
Amount accrued | $ 0 | $ 0 |
Commitments and Contingencies_4
Commitments and Contingencies - Other taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Loss Contingencies [Line Items] | |||
Liability for uncertain tax positions | $ 27,000 | $ 22,600 | |
Net loss attributable to common stockholders | $ 307,063 | $ 121,949 | $ 63,708 |
Settled Litigation | |||
Loss Contingencies [Line Items] | |||
Net loss attributable to common stockholders | $ 13,400 |
Stockholders' Equity - Preferre
Stockholders' Equity - Preferred Stock (Details) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Preferred Stock | ||
Preferred stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Stockholders' Equity - Common S
Stockholders' Equity - Common Stock (Details) | Dec. 31, 2019Vote$ / sharesshares | Dec. 31, 2018Vote$ / sharesshares | May 31, 2018$ / shares |
Common Stock | |||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Common Class A | |||
Common Stock | |||
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, issued (in shares) | 126,882,172 | 80,769,763 | |
Shares, Issued | 126,882,172 | 80,769,763 | |
Common stock, outstanding (in shares) | 126,882,172 | 80,769,763 | |
Votes per share | Vote | 1 | 1 | |
Common Class B | |||
Common Stock | |||
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Common stock, issued (in shares) | 11,530,627 | 19,310,465 | |
Shares, Issued | 11,530,627 | 19,310,465 | |
Common stock, outstanding (in shares) | 11,530,627 | 19,310,465 | |
Votes per share | Vote | 10 | 10 |
Stockholders' Equity Stockholde
Stockholders' Equity Stockholders' Equity - Follow-on Public Offering (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Class of Stock [Line Items] | ||||
Stock price at grant date (in dollars per share) | $ 124 | |||
Proceeds from a public offering, net of underwriting discount | $ 979,000 | $ 980,000 | $ 0 | $ 0 |
Common Class A | Follow-on Public Offering | ||||
Class of Stock [Line Items] | ||||
Shares sold (in shares) | 8,064,515 | |||
Common Class A | Over-Allotment Option, FPO | ||||
Class of Stock [Line Items] | ||||
Shares sold (in shares) | 1,051,893 |
Stockholders' Equity - Common_2
Stockholders' Equity - Common Stock Shares Reserved (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Stockholders' Equity | ||
Total (in shares) | 46,270,890 | 39,692,245 |
2016 Stock Option and Incentive Plan | ||
Stockholders' Equity | ||
Stock-based awards available for grant under 2016 Plan (in shares) | 14,957,734 | 9,313,354 |
Common Class A | ||
Stockholders' Equity | ||
Class A common stock reserved for Twilio.org (in shares) | 795,673 | 572,676 |
Class A common stock reserved for the convertible senior notes (in shares) | 10,472,165 | 10,472,165 |
Stock options issued and outstanding | ||
Stockholders' Equity | ||
Stock options issued and outstanding (in shares) | 7,705,848 | 7,978,369 |
Nonvested restricted stock units issued and outstanding | ||
Stockholders' Equity | ||
Nonvested restricted stock units issued and outstanding (in shares) | 8,490,517 | 8,262,902 |
Class A common stock committed under 2016 ESPP | ||
Stockholders' Equity | ||
Stock-based awards available for grant under 2016 Plan (in shares) | 3,848,953 | 3,092,779 |
Stock-Based Compensation - 2008
Stock-Based Compensation - 2008 Stock Option Plan (Details) | Dec. 31, 2019shares |
2008 Stock Option Plan | |
Stock Based Compensation | |
Shares available for future issuance (in shares) | 0 |
Stock-Based Compensation - 2016
Stock-Based Compensation - 2016 Stock Option Plan (Details) - shares | Jan. 01, 2019 | Jan. 01, 2018 | Dec. 31, 2019 | Jun. 21, 2016 |
Stock Based Compensation | ||||
Increase in shares available for grant (in shares) | 1,000,802 | 939,698 | ||
Employee and nonemployee stock options | ||||
Stock Based Compensation | ||||
Expiration term | 10 years | |||
Employee and nonemployee stock options | New Hires | ||||
Stock Based Compensation | ||||
Vesting period | 4 years | |||
Employee and nonemployee stock options | First vesting | New Hires | ||||
Stock Based Compensation | ||||
Percentage of vesting rights | 25.00% | |||
Vesting period | 1 year | |||
Nonvested restricted stock units issued and outstanding | ||||
Stock Based Compensation | ||||
Vesting period | 4 years | |||
Nonvested restricted stock units issued and outstanding | First vesting | New Hires | ||||
Stock Based Compensation | ||||
Percentage of vesting rights | 25.00% | |||
Vesting period | 1 year | |||
2016 Stock Option and Incentive Plan | ||||
Stock Based Compensation | ||||
Maximum automatic annual increase as a percentage of outstanding common shares | 5.00% | |||
Increase in shares available for grant (in shares) | 5,004,011 | 4,698,490 | ||
2016 Stock Option and Incentive Plan | Common Class A | ||||
Stock Based Compensation | ||||
Shares reserved for issuance (in shares) | 11,500,000 | |||
2016 Stock Option and Incentive Plan | Employee and nonemployee stock options | ||||
Stock Based Compensation | ||||
Minimum grant price as a percentage of fair market value per share of the underlying common stock on the date of grant (as a percent) | 100.00% |
Stock-Based Compensation - 20_2
Stock-Based Compensation - 2016 Employee Stock Purchase Plan (Details) - USD ($) $ in Millions | Jan. 01, 2019 | Jan. 01, 2018 | Dec. 31, 2019 | Jun. 21, 2016 |
Stock Based Compensation | ||||
Increase in shares available for grant (in shares) | 1,000,802 | 939,698 | ||
Unrecognized compensation cost, other than options | $ 4.4 | |||
Weighted-average period (in years) | 4 months 24 days | |||
Class A common stock committed under 2016 ESPP | ||||
Stock Based Compensation | ||||
Maximum automatic annual increase (in shares) | 1,800,000 | |||
Maximum automatic annual increase as a percentage of outstanding common shares | 1.00% | |||
Common Class A | Class A common stock committed under 2016 ESPP | ||||
Stock Based Compensation | ||||
Shares reserved for issuance (in shares) | 2,400,000 | |||
Discount from market price, offering date (as a percent) | 15.00% | |||
Discount from market price, purchase date (as a percent) | 15.00% | |||
Purchase price, percentage of fair market value (as a percent) | 85.00% |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Details) - Employee and nonemployee stock options - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Number of options outstanding | ||
Outstanding options as of the beginning of the period (in shares) | 7,423,369 | |
Granted (in shares) | 909,229 | |
Assumed in acquisition (in shares) | 2,978,555 | |
Exercised (in shares) | (3,620,866) | |
Forfeited and cancelled (in shares) | (539,439) | |
Outstanding options as of the end of the period (in shares) | 7,150,848 | 7,423,369 |
Weighted- average exercise price (Per share) | ||
Outstanding options as of the beginning of the period (in dollars per share) | $ 16.07 | |
Granted (in dollars per share) | 118.35 | |
Assumed in acquisition (in dollars per share) | 14.91 | |
Exercised (in dollars per share) | 10.43 | |
Forfeited and cancelled (in dollars per share) | 51.28 | |
Outstanding options as of the end of the period (in dollars per share) | $ 28.79 | $ 16.07 |
Weighted- average remaining contractual term (in years) | ||
Weighted-average remaining contractual term (in years) | 6 years 5 months 19 days | 6 years 9 months 18 days |
Aggregate intrinsic value | $ 511,971 | $ 543,640 |
Options vested and exercisable and options vested and expected to vest | ||
Options vested and exercisable - number of options outstanding (in shares) | 4,721,801 | |
Options vested and exercisable - weighted-average exercise price (in dollars per share) | $ 14 | |
Options vested and exercisable - weighted-average remaining contractual term | 5 years 7 months 24 days | |
Options vested and exercisable - aggregate intrinsic value | $ 398,490 |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock Options - Additional Information (Details) - Employee and nonemployee stock options - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock Based Compensation | |||
Aggregate intrinsic value of stock options exercised | $ 394,998 | $ 178,504 | $ 131,955 |
Total estimated grant date fair value of options vested | $ 81,292 | $ 21,761 | $ 15,831 |
Weighted-average grant date fair value per share of options granted (in dollars per share) | $ 58.13 | $ 18.40 | $ 13.33 |
Stock-Based Compensation - Perf
Stock-Based Compensation - Performance-Based Stock Options (Details) $ / shares in Units, $ in Thousands | Feb. 28, 2017USD ($)award$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares |
Performance-based stock options | |||
Stock-Based Compensation | |||
Number of distinct awards | award | 3 | ||
Total grant value | $ | $ 5,900 | ||
Vesting period upon satisfaction of performance condition | 2 years | ||
Performance condition achievement window | 4 years 3 months 18 days | ||
Expiration term | 7 years | ||
Number of options outstanding | |||
Outstanding options as of the beginning of the period (in shares) | shares | 555,000 | ||
Granted (in shares) | shares | 555,000 | 0 | |
Exercised (in shares) | shares | 0 | ||
Forfeited and cancelled (in shares) | shares | 0 | ||
Outstanding options as of the end of the period (in shares) | shares | 555,000 | 555,000 | |
Weighted- average exercise price (Per share) | |||
Outstanding options as of the beginning of the period (in dollars per share) | $ 31.72 | ||
Granted (in dollars per share) | 0 | ||
Exercised (in dollars per share) | 0 | ||
Forfeited and cancelled (in dollars per share) | 0 | ||
Outstanding options as of the end of the period (in dollars per share) | $ 31.72 | $ 31.72 | |
Weighted-average remaining contractual term | |||
Weighted-average remaining contractual term (in years) | 4 years 1 month 28 days | 6 years | |
Aggregate intrinsic value | $ | $ 36,941 | $ 0 | |
Options vested and exercisable | |||
Options vested and exercisable - number of options outstanding (in shares) | shares | 427,812 | ||
Options vested and exercisable - weighted-average exercise price (in dollars per share) | $ 31.72 | ||
Options vested and exercisable - weighted-average remaining contractual term | 4 years 1 month 28 days | ||
Options vested and exercisable - aggregate intrinsic value | $ | $ 28,475 | ||
$13.48 grant date fair value | |||
Stock-Based Compensation | |||
Grant date fair value (in dollars per share) | $ 13.48 | ||
Derived service period as adjusted | 3 years 1 month 6 days | ||
$10.26 grant date fair value | |||
Stock-Based Compensation | |||
Grant date fair value (in dollars per share) | $ 10.26 | ||
Derived service period as adjusted | 3 years 10 months 24 days | ||
$8.41 grant date fair value | |||
Stock-Based Compensation | |||
Grant date fair value (in dollars per share) | $ 8.41 | ||
Derived service period as adjusted | 4 years 7 months 6 days |
Stock-Based Compensation - St_3
Stock-Based Compensation - Stock Options - Unrecognized Compensation Cost (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Stock Based Compensation | |
Weighted-average period (in years) | 4 months 24 days |
Stock options issued and outstanding | |
Stock Based Compensation | |
Unrecognized compensation cost, options | $ 95.6 |
Weighted-average period (in years) | 1 year 10 months 24 days |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Units Activity (Details) - Nonvested restricted stock units issued and outstanding - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Number of awards outstanding | ||
Nonvested RSUs at the beginning of the period (in shares) | 8,262,902 | |
Granted (in shares) | 3,413,404 | |
Assumed in SendGrid acquisition (in shares) | 561,999 | |
Vested (in shares) | (2,893,119) | |
Forfeited and canceled (in shares) | (854,669) | |
Nonvested RSUs at the end of the period (in shares) | 8,490,517 | |
Weighted- average grant date fair value (Per share) | ||
Nonvested RSUs at the beginning of the period (in dollars per share) | $ 42.70 | |
Granted (in dollars per share) | 119.04 | |
Assumed in SendGrid acquisition (in dollars per share) | 112.88 | |
Vested (in dollars per share) | 51.15 | |
Forfeited and canceled (in dollars per share) | 61.94 | |
Nonvested RSUs at the end of the period (in dollars per share) | $ 74.21 | |
Aggregate intrinsic value (In thousands) | ||
Aggregate intrinsic value | $ 830,167 | $ 729,373 |
Stock-Based Compensation - Re_2
Stock-Based Compensation - Restricted Stock Units - Unrecognized Compensation Cost (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Stock Based Compensation | |
Unrecognized compensation cost, other than options | $ 4.4 |
Weighted-average period (in years) | 4 months 24 days |
Nonvested restricted stock units issued and outstanding | |
Stock Based Compensation | |
Unrecognized compensation cost, other than options | $ 573.2 |
Weighted-average period (in years) | 2 years 8 months 12 days |
Stock-Based Compensation - Valu
Stock-Based Compensation - Valuation Assumptions (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2019 | |
Valuation Assumptions | ||||
Stock price at grant date (in dollars per share) | $ 124 | |||
Employee stock options | ||||
Valuation Assumptions | ||||
Expected volatility, low end of range (as a percent) | 49.00% | 38.60% | 44.30% | |
Expected volatility, high end of range (as a percent) | 66.50% | 44.20% | 47.60% | |
Risk-free interest rate, low end of range (as a percent) | 1.60% | 2.90% | 1.90% | |
Risk-free interest rate, high end of range (as a percent) | 2.50% | 3.00% | 2.30% | |
Dividend rate (as a percent) | 0.00% | 0.00% | 0.00% | |
Class A common stock committed under 2016 ESPP | ||||
Valuation Assumptions | ||||
Expected term (in years) | 6 months | 6 months | ||
Expected volatility, low end of range (as a percent) | 43.10% | 39.80% | 33.20% | |
Expected volatility, high end of range (as a percent) | 50.30% | 47.50% | 33.90% | |
Risk-free interest rate, low end of range (as a percent) | 1.60% | 2.10% | 1.10% | |
Risk-free interest rate, high end of range (as a percent) | 2.40% | 2.50% | 1.40% | |
Dividend rate (as a percent) | 0.00% | 0.00% | 0.00% | |
Performance-based stock options | ||||
Valuation Assumptions | ||||
Asset volatility (as a percent) | 40.00% | |||
Equity volatility (as a percent) | 45.00% | |||
Discount rate (as a percent) | 14.00% | |||
Stock price at grant date (in dollars per share) | $ 31.7 | |||
Minimum | Employee stock options | ||||
Valuation Assumptions | ||||
Fair value of common stock (in dollars per share) | $ 103.70 | $ 33.01 | $ 23.60 | |
Expected term (in years) | 3 months 29 days | 1 year | 6 years 29 days | |
Minimum | Class A common stock committed under 2016 ESPP | ||||
Valuation Assumptions | ||||
Expected term (in years) | 5 months 26 days | |||
Maximum | Employee stock options | ||||
Valuation Assumptions | ||||
Fair value of common stock (in dollars per share) | $ 130.70 | $ 76.63 | $ 31.96 | |
Expected term (in years) | 6 years 29 days | 6 years 29 days | 6 years 29 days | |
Maximum | Class A common stock committed under 2016 ESPP | ||||
Valuation Assumptions | ||||
Expected term (in years) | 6 months |
Stock-Based Compensation - St_4
Stock-Based Compensation - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock-Based Compensation Expense | |||
Stock-based compensation expense | $ 264,318 | $ 93,273 | $ 49,619 |
Cost of revenue | |||
Stock-Based Compensation Expense | |||
Stock-based compensation expense | 7,123 | 1,126 | 650 |
Research and development | |||
Stock-Based Compensation Expense | |||
Stock-based compensation expense | 126,012 | 42,277 | 22,808 |
Sales and marketing | |||
Stock-Based Compensation Expense | |||
Stock-based compensation expense | 60,886 | 23,616 | 9,822 |
General and administrative | |||
Stock-Based Compensation Expense | |||
Stock-based compensation expense | 70,297 | $ 26,254 | $ 16,339 |
SendGrid | |||
Stock-Based Compensation Expense | |||
Stock-based compensation expense | $ 81,800 |
Net Loss per Share Attributab_3
Net Loss per Share Attributable to Common Stockholders - General Information (Details) - Vote | Dec. 31, 2019 | Dec. 31, 2018 |
Common Class A | ||
Net Loss Per Share Attributable to Common Stockholders | ||
Votes per share | 1 | 1 |
Common Class B | ||
Net Loss Per Share Attributable to Common Stockholders | ||
Votes per share | 10 | 10 |
Net Loss Per Share Attributab_4
Net Loss Per Share Attributable to Common Stockholders - Basic and Diluted Net Loss per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Net Loss Per Share Attributable to Common Stockholders | |||
Net loss attributable to common stockholders | $ (307,063) | $ (121,949) | $ (63,708) |
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares) | 130,083,046 | 97,130,339 | 91,224,607 |
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share) | $ (2.36) | $ (1.26) | $ (0.70) |
Net Loss Per Share Attributab_5
Net Loss Per Share Attributable to Common Stockholders - Anti-Dilutive Securities (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Anti-dilutive securities | |||
Antidilutive securities (in shares) | 20,350,477 | 16,928,742 | 17,251,486 |
Conversion price (in dollars per share) | $ 70.90 | ||
Stock options issued and outstanding | |||
Anti-dilutive securities | |||
Antidilutive securities (in shares) | 7,705,848 | 7,978,369 | 10,710,427 |
Nonvested restricted stock units issued and outstanding | |||
Anti-dilutive securities | |||
Antidilutive securities (in shares) | 8,490,517 | 8,262,902 | 5,665,459 |
Class A common stock reserved for Twilio.org | |||
Anti-dilutive securities | |||
Antidilutive securities (in shares) | 795,673 | 572,676 | 635,014 |
Class A common stock committed under 2016 ESPP | |||
Anti-dilutive securities | |||
Antidilutive securities (in shares) | 207,792 | 113,312 | 235,372 |
Conversion spread | |||
Anti-dilutive securities | |||
Antidilutive securities (in shares) | 3,150,647 | 233 | 0 |
Unvested shares subject to repurchase | |||
Anti-dilutive securities | |||
Antidilutive securities (in shares) | 0 | 1,250 | 5,214 |
Income Taxes - Domestic and For
Income Taxes - Domestic and Foreign Components of Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (328,902) | $ (96,448) | $ (46,737) |
International | (33,314) | (24,710) | (16,266) |
Loss before provision for income taxes | $ (362,216) | $ (121,158) | $ (63,003) |
Income Taxes Income Taxes - Pro
Income Taxes Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
Federal | $ 0 | $ 0 | $ 99 |
State | 198 | 139 | 78 |
Foreign | 2,684 | 881 | 823 |
Total | 2,882 | 1,020 | 1,000 |
Deferred: | |||
Federal | (49,393) | 29 | 28 |
State | (7,474) | 19 | 10 |
Foreign | (1,168) | (277) | (333) |
Total | (58,035) | (229) | (295) |
Income tax provision (benefit) | $ (55,153) | $ 791 | $ 705 |
Income Taxes Income Taxes - Rec
Income Taxes Income Taxes - Reconciliation of the Statutory Federal Tax Rate and the Effective Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Tax benefit at federal statutory rate | 21.00% | 21.00% | 34.00% |
State tax, net of federal benefit | 8.00% | 15.00% | 10.00% |
Stock-based compensation | 14.00% | 31.00% | 47.00% |
Credits | 4.00% | 8.00% | 8.00% |
Foreign rate differential | (2.00%) | (4.00%) | (8.00%) |
Change in valuation allowance | (29.00%) | (68.00%) | (46.00%) |
Change in federal statutory rate | 0.00% | 0.00% | (45.00%) |
Other | (1.00%) | (3.00%) | (1.00%) |
Effective tax rate | 15.00% | 0.00% | (1.00%) |
Income Taxes Income Taxes - Sig
Income Taxes Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | |||
Net operating loss carryforwards | $ 274,116 | $ 116,190 | $ 56,138 |
Accrued and prepaid expenses | 11,828 | 11,594 | 9,140 |
Stock-based compensation | 35,035 | 11,147 | 7,131 |
Research and development credits | 65,955 | 32,206 | 16,212 |
Charitable contributions | 3,172 | 3,100 | 1,233 |
Capped call | 9,914 | 13,175 | 0 |
Debt issuance cost | 493 | 638 | 0 |
Depreciable property | 2 | 0 | 0 |
Lease liability | 39,117 | ||
Other | 0 | 194 | 472 |
Gross deferred tax assets | 439,632 | 188,244 | 90,326 |
Valuation allowance | (255,893) | (147,354) | (78,900) |
Net deferred tax assets | 183,739 | 40,890 | 11,426 |
Capitalized software | (13,032) | (10,686) | (7,664) |
Prepaid expenses | (1,157) | (838) | (1,015) |
Acquired intangibles | (107,281) | (2,997) | (2,101) |
Property and equipment | (1,578) | (1,990) | (2,380) |
Convertible debt | (20,745) | (27,164) | 0 |
Right-of-use asset | (39,630) | ||
Deferred commissions | (7,446) | (2,396) | (718) |
Other | (405) | 0 | 0 |
Net deferred tax liability | $ (7,535) | $ (5,181) | $ (2,452) |
Income Taxes - Net Operating Lo
Income Taxes - Net Operating Loss Carryforwards and Tax Credits (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Domestic Tax Authority | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 1,159,329 |
Tax credit carryforward, amount | 58,404 |
Operating loss carryforwards with indefinite lives | 902,507 |
State and Local Jurisdiction | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | 630,151 |
Tax credit carryforward, amount | 38,817 |
Foreign Tax Authority | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 13,772 |
Income Taxes Income Taxes - Add
Income Taxes Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | |||
Release of valuation allowance on deferred tax assets | $ 48 | ||
Valuation allowance | 108.5 | $ 68.5 | |
SendGrid | |||
Business Acquisition [Line Items] | |||
Release of valuation allowance on deferred tax assets | $ 55 | $ 47.9 |
Income Taxes Income Taxes - Unr
Income Taxes Income Taxes - Unrecognized Tax Benefits - Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefit, beginning of year | $ 15,635 | $ 9,445 | $ 12,275 |
Gross increases for tax positions of prior years | 12,939 | 1,233 | 493 |
Gross decrease for tax positions of prior years | (395) | (4) | (6,331) |
Gross increases for tax positions of current year | 20,863 | 4,961 | 3,008 |
Unrecognized tax benefit, end of year | $ 49,042 | $ 15,635 | $ 9,445 |
Income Taxes Income Taxes - U_2
Income Taxes Income Taxes - Unrecognized Tax Benefit - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Income Tax Disclosure [Abstract] | ||||
Unrecognized tax benefits | $ 49,042 | $ 15,635 | $ 9,445 | $ 12,275 |
Unrecognized tax benefits that would impact effective tax rate if recognized | 1,700 | |||
Accumulated interest and penalties related to uncertain tax positions | $ 200 |
Income Taxes Income Taxes - Tax
Income Taxes Income Taxes - Tax Cuts and Jobs Act (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
U.S. corporate income tax rate (as a percent) | 21.00% | 21.00% | 34.00% |
Decrease to deferred tax assets valuation allowance | $ 28 |