Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-40806 | |
Entity Registrant Name | Freshworks Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 2950 S Delaware Street | |
Entity Address, Address Line Two | Suite 201 | |
Entity Address, City or Town | San Mateo | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94403 | |
Entity Tax Identification Number | 33-1218825 | |
City Area Code | 650 | |
Local Phone Number | 513-0514 | |
Title of 12(b) Security | Class A common stock, par value $0.00001 per share | |
Trading Symbol | FRSH | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001544522 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 168,032,444 | |
Class B Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 123,110,145 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 344,487 | $ 304,083 |
Marketable securities | 806,122 | 843,405 |
Accounts receivable, net of allowance of $7,288 and $6,628 | 72,807 | 70,470 |
Deferred contract acquisition costs | 20,761 | 20,139 |
Prepaid expenses and other current assets | 46,487 | 38,913 |
Total current assets | 1,290,664 | 1,277,010 |
Property and equipment, net | 24,214 | 24,139 |
Operating lease right-of-use assets | 31,175 | 33,024 |
Deferred contract acquisition costs, noncurrent | 18,865 | 19,536 |
Goodwill | 6,181 | 6,181 |
Deferred tax assets | 8,645 | 8,689 |
Other assets | 11,098 | 11,637 |
Total assets | 1,390,842 | 1,380,216 |
Current liabilities: | ||
Accounts payable | 4,415 | 5,908 |
Accrued liabilities | 58,327 | 59,008 |
Deferred revenue | 220,550 | 205,626 |
Income tax payable | 2,177 | 1,150 |
Total current liabilities | 285,469 | 271,692 |
Operating lease liabilities, non-current | 26,183 | 28,174 |
Other liabilities | 28,748 | 28,532 |
Total liabilities | 340,400 | 328,398 |
Commitments and contingencies (Note 7) | ||
Stockholders' equity: | ||
Preferred Stock, value | 0 | 0 |
Additional paid-in capital | 4,600,688 | 4,562,319 |
Accumulated other comprehensive loss | (4,512) | (7,431) |
Accumulated deficit | (3,545,737) | (3,503,073) |
Total stockholders' equity | 1,050,442 | 1,051,818 |
Total liabilities and stockholders' equity | 1,390,842 | 1,380,216 |
Class A Common Stock | ||
Stockholders' equity: | ||
Common stock, value | 2 | 2 |
Class B Common Stock | ||
Stockholders' equity: | ||
Common stock, value | $ 1 | $ 1 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accounts receivable, allowance for credit loss, current | $ 7,288 | $ 6,628 |
Preferred stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Class A Common Stock | ||
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, issued (in shares) | 167,518,238 | 162,825,075 |
Common stock, outstanding (in shares) | 167,518,238 | 162,825,075 |
Class B Common Stock | ||
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 350,000,000 | 350,000,000 |
Common stock, issued (in shares) | 123,016,745 | 126,268,150 |
Common stock, outstanding (in shares) | 123,016,745 | 126,268,150 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Revenue | $ 137,692 | $ 114,637 |
Cost of revenue | 25,236 | 22,395 |
Gross profit | 112,456 | 92,242 |
Operating expense: | ||
Research and development | 32,857 | 30,717 |
Sales and marketing | 86,810 | 71,466 |
General and administrative | 40,896 | 37,183 |
Total operating expenses | 160,563 | 139,366 |
Loss from operations | (48,107) | (47,124) |
Interest and other income, net | 9,479 | 602 |
Loss before income taxes | (38,628) | (46,522) |
Provision for income taxes | 4,036 | 2,537 |
Net loss | $ (42,664) | $ (49,059) |
Net loss per share - basic (in dollars per share) | $ (0.15) | $ (0.18) |
Net loss per share - diluted (in dollars per share) | $ (0.15) | $ (0.18) |
Weighted-average shares used in computing net loss per share - basic (in shares) | 290,133 | 278,186 |
Weighted-average shares used in computing net loss per share - diluted (in shares) | 290,133 | 278,186 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (42,664) | $ (49,059) |
Other comprehensive loss: | ||
Change in unrealized loss on marketable securities | 2,922 | (3,606) |
Net change on cash flow hedges | (3) | 0 |
Total other comprehensive income (loss) | 2,919 | (3,606) |
Comprehensive loss | $ (39,745) | $ (52,665) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2021 | 273,294 | ||||
Beginning balance at Dec. 31, 2021 | $ 1,238,039 | $ 3 | $ 4,509,724 | $ (747) | $ (3,270,941) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of stock options (in shares) | 113 | ||||
Issuance of common stock upon exercise of stock options | 29 | 29 | |||
Issuance of common stock upon vesting and settlement of restricted stock units, net of shares withheld for taxes (in shares) | 9,663 | ||||
Issuance of common stock upon vesting and settlement of restricted stock units, net of shares withheld for taxes | (120,810) | (120,810) | |||
Stock-based compensation | 46,625 | 46,625 | |||
Other comprehensive income | (3,606) | (3,606) | |||
Net loss | (49,059) | (49,059) | |||
Ending balance (in shares) at Mar. 31, 2022 | 283,070 | ||||
Ending balance at Mar. 31, 2022 | 1,111,218 | $ 3 | 4,435,568 | (4,353) | (3,320,000) |
Beginning balance (in shares) at Dec. 31, 2022 | 289,093 | ||||
Beginning balance at Dec. 31, 2022 | $ 1,051,818 | $ 3 | 4,562,319 | (7,431) | (3,503,073) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of common stock upon exercise of stock options (in shares) | 19 | 19 | |||
Issuance of common stock upon exercise of stock options | $ 6 | 6 | |||
Issuance of common stock upon vesting and settlement of restricted stock units, net of shares withheld for taxes (in shares) | 1,423 | ||||
Issuance of common stock upon vesting and settlement of restricted stock units, net of shares withheld for taxes | (12,845) | (12,845) | |||
Stock-based compensation | 51,208 | 51,208 | |||
Other comprehensive income | 2,919 | 2,919 | |||
Net loss | (42,664) | (42,664) | |||
Ending balance (in shares) at Mar. 31, 2023 | 290,535 | ||||
Ending balance at Mar. 31, 2023 | $ 1,050,442 | $ 3 | $ 4,600,688 | $ (4,512) | $ (3,545,737) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (42,664) | $ (49,059) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 3,112 | 2,973 |
Amortization of deferred contract acquisition costs | 5,617 | 4,275 |
Non-cash lease expense | 1,850 | 1,404 |
Stock-based compensation | 50,694 | 46,625 |
Premium (discount) amortization on marketable securities | (3,520) | 766 |
Change in fair value of equity securities | (15) | (85) |
Deferred income taxes | 113 | 309 |
Other | 85 | 754 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (2,490) | 3,160 |
Deferred contract acquisition costs | (5,568) | (5,600) |
Prepaid expenses and other assets | (7,248) | (8,685) |
Accounts payable | (1,494) | (2,059) |
Accrued and other liabilities | (392) | (4,972) |
Deferred revenue | 14,924 | 14,239 |
Operating lease liabilities | (1,500) | (2,690) |
Net cash provided by operating activities | 11,504 | 1,355 |
Cash Flows from Investing Activities: | ||
Purchases of property and equipment | (383) | (1,397) |
Proceeds from sale of property and equipment | 24 | 17 |
Capitalized internal-use software | (2,025) | (1,344) |
Purchases of marketable securities | (217,754) | (151,408) |
Sales of marketable securities | 0 | 58,736 |
Maturities and redemptions of marketable securities | 261,474 | 69,750 |
Net cash provided by (used in) investing activities | 41,336 | (25,646) |
Cash Flows from Financing Activities: | ||
Proceeds from exercise of stock options | 6 | 28 |
Payment of withholding taxes on net share settlement of equity awards | (12,434) | (119,948) |
Payment of deferred offering costs | 0 | (109) |
Net cash used in financing activities | (12,428) | (120,029) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 40,412 | (144,320) |
Cash, cash equivalents and restricted cash, beginning of period | 304,158 | 747,864 |
Cash, cash equivalents and restricted cash, end of period | 344,570 | 603,544 |
Reconciliation of cash, cash equivalents and restricted cash to consolidated balance sheets: | ||
Cash and cash equivalents | 344,487 | 603,466 |
Restricted cash included in prepaid expenses and other current assets | 3 | 46 |
Restricted cash included in other assets | 80 | 32 |
Total cash, cash equivalents and restricted cash | 344,570 | 603,544 |
Supplemental cash flow information: | ||
Cash paid for taxes | 2,158 | 3,649 |
Non-cash investing and financing activities: | ||
Operating lease right-of-use assets obtained in exchange for operating lease obligations | 0 | 5,324 |
Stock-based compensation capitalized as internal-use software | $ 514 | $ 0 |
Business, Basis of Presentation
Business, Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business, Basis of Presentation and Summary of Significant Accounting Policies | 1. Business, Basis of Presentation and Summary of Significant Accounting Policies Description of Business Freshworks Inc. (Freshworks, or the Company) is a software development company that provides modern software-as-a-service (SaaS) products that are designed with the user in mind. The Company was incorporated in Delaware in 2010 and is headquartered in San Mateo, California. Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, and all intercompany balances and transactions have been eliminated in consolidation. Unaudited Interim Consolidated Financial Statement s The accompanying condensed consolidated balance sheet as of March 31, 2023, the condensed consolidated statements of operations, of comprehensive loss, of cash flows, and of stockholders’ equity for the three months ended March 31, 2023 and 2022, and the related notes to such condensed consolidated financial statements are unaudited. These unaudited condensed consolidated financial statements are presented in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (SEC) and do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. In management’s opinion, the unaudited condensed consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of March 31, 2023 and its results of operations and cash flows for the three months ended March 31, 2023 and 2022. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year or any other future interim or annual period. The condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 23, 2023. Use of Estimates The preparation of the condensed consolidated financial statements in accordance with 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 consolidated financial statements, and the reported amounts of income and expense during the reporting periods. Significant items subject to such estimates and assumptions include, but are not limited to, the following: • determination of standalone selling price (SSP) for each distinct performance obligation included in customer contracts with multiple performance obligations; • allowance for doubtful accounts; • expected benefit period of deferred contract acquisition costs; • capitalization of internal-use software development costs; • fair value of acquired intangible assets and goodwill; • useful lives of long-lived assets; • valuation of deferred tax assets; • valuation of employee defined benefit plan; • fair value of share-based awards, including performance-based awards; and • incremental borrowing rate used for operating leases. Concentrations of Risk Financial instruments that potentially expose the Company to significant concentration of credit risk consist primarily of cash, cash equivalents, marketable securities, and accounts receivable. The Company’s cash, cash equivalents and marketable securities are generally held with large financial institutions and are in excess of the federally insured limits provided on such deposits. In addition, the Company has cash and cash equivalents held in international bank accounts, which are denominated primarily in Euros, British Pounds, and Indian Rupees. There were no customers that individually exceeded 10% of the Company’s revenue for the three months ended March 31, 2023 and 2022 or that represented 10% or more of the Company’s consolidated accounts receivable balance as of March 31, 2023. The Company primarily relies upon its third-party cloud infrastructure partner, Amazon Web Services, to serve customers and operate certain aspects of its services. Any disruption of this cloud infrastructure partner would impact the Company's operations and its business could be adversely impacted. Significant Accounting Policies The Company's significant accounting policies are described in the Annual Report on Form 10-K for the year ended December 31, 2022. There have been no significant changes to these policies that have had a material impact on the condensed consolidated financial statements and the related notes for the three months ended March 31, 2023. However, starting in 2023, the Company entered into foreign exchange forward contracts to hedge a portion of its forecasted foreign currency expenses and while the impact of the Company's derivative instruments are not material to its condensed consolidated financial statements, the accounting policy on Derivative Instruments is discussed below. Derivative Instruments The Company enters into foreign currency forward contracts, most of which were designated as cash flow hedges, in order to manage the volatility of cash flows that relate to cost of revenues and operating expenses denominated in Indian Rupee. All derivative instruments are measured at fair value based upon quoted market prices for comparable instruments and as such, classified within Level 2 of the fair value hierarchy. Derivative assets and liabilities are presented on a gross basis on the condensed consolidated balance sheets under prepaid expenses and other current assets and accrued liabilities, respectively. Gains or losses related to cash flow hedges are recorded as a component of accumulated other comprehensive income (AOCI) on the condensed consolidated statements of stockholders' equity until the forecasted transaction occurs in earnings. When the forecasted transaction occurs, the related gains and losses are reclassified into earnings within the financial statement line item associated with the underlying hedged transaction. If the underlying hedged transaction does not occur, or it becomes probable that the hedged transaction will not occur, the cumulative unrealized gain or loss is reclassified immediately from AOCI into earnings within interest and other income. Changes in the fair value of currency forward exchange contracts due to changes in time value were excluded from the assessment of effectiveness. The initial value of this excluded component is amortized on a straight-line basis over the life of the hedging instrument and recognized in the f inancial statement line item to which the hedge relates. A majority of the balance related to foreign exchange derivative instruments included in AOCI at March 31, 2023 is expected to be reclassified into earnings within 12 months. Derivative instruments are classified in the condensed consolidated statements of cash flows as cash from operating activities, which reflect the classification of the underlying hedged transactions. The Company does not use derivative financial instruments for trading or speculative purposes. As of March 31, 2023, the total notional amount of outstanding designated foreign currency forward contracts was $22.3 million. The fair value of derivative assets and liabilities as of March 31, 2023, and all related unrealized and realized gains and losses during the three months ended March 31, 2023 were not material. Entering into derivative instruments exposes the Company to credit risk to the extent that the counterparties are unable to meet the terms of the contract. The Company mitigates this credit risk by transacting with major financial institutions with high credit ratings. In addition, the Company has entered into master netting arrangements that mitigates credit risk by permitting net settlement of transactions. As such, the Company's exposure is not considered significant. The Company does not have any collateral requirements with its counterparties. Recent Accounting Pronouncements There have been no recently issued accounting pronouncements that are expected to have a material impact on the Company's condensed consolidated financial statements. |
Revenue From Contracts with Cus
Revenue From Contracts with Customers | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue From Contracts with Customers | 2. Revenue From Contracts with Customers The Company derives revenue from subscription fees and related professional services. The Company sells subscriptions for its cloud-based solutions directly to customers and indirectly through channel partners through arrangements that are non-cancelable and non-refundable. The Company’s subscription arrangements do not provide customers with the right to take possession of the software supporting the solutions and, as a result, are accounted for as service arrangements. The Company records revenue net of sales or value-added taxes. Disaggregation of Revenue The following table summarizes revenue by the Company’s service offerings (in thousands): Three Months Ended March 31, 2023 2022 Subscription services $ 134,023 $ 111,397 Professional services 3,669 3,240 Total revenue $ 137,692 $ 114,637 See Note 11 for revenue by geographic location. Deferred Revenue and Remaining Performance Obligations Deferred revenue consists of customer billings in advance of revenue being recognized from the Company’s subscription and professional services arrangements. Revenue recognized during the three months ended March 31, 2023 and 2022 from amounts included in deferred revenue at the beginning of these periods was $93.7 million and $72.2 million, respectively. The aggregate balance of remaining performance obligations as of March 31, 2023 was $325.6 million. The Company expects to recognize $253.7 million of the balance as revenue in the next 12 months and the remainder thereafter. The aggregate balance of remaining performance obligations represents contracted revenue that has not yet been recognized, which includes unearned revenue and unbilled amounts that will be recognized as revenue in future periods. Deferred Contract Acquisition Costs The change in the balance of deferred contract acquisition costs during the periods presented is as follows (in thousands): Three Months Ended March 31, 2023 2022 Balance at beginning of the period $ 39,675 $ 29,647 Add: Contract costs capitalized during the period 5,568 5,600 Less: Amortization of contract costs during the period (5,617) (4,275) Balance at end of the period $ 39,626 $ 30,972 |
Cash Equivalents and Marketable
Cash Equivalents and Marketable Securities | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Cash Equivalents and Marketable Securities | 3. Cash Equivalents and Marketable Securities Cash equivalents and available-for-sale debt securities consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: Money market funds $ 155,266 $ — $ — $ 155,266 U.S. treasury securities 37,797 9 — 37,806 U.S. government agency securities 48,796 18 — 48,814 Corporate debt securities 10,474 — — 10,474 Total cash equivalents 252,333 27 — 252,360 Debt securities: U.S. treasury securities 346,566 95 (1,621) 345,040 U.S. government agency securities 376,006 232 (2,691) 373,547 Corporate debt securities 86,564 — (550) 86,014 Total debt securities 809,136 327 (4,862) 804,601 Total cash equivalents and debt securities $ 1,061,469 $ 354 $ (4,862) $ 1,056,961 December 31, 2022 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: Money market funds $ 219,512 $ — $ — $ 219,512 U.S. treasury securities 13,912 3 — 13,915 U.S. government agency securities 10,417 2 — 10,419 Corporate debt securities 1,995 1 — 1,996 Total cash equivalents 245,836 6 — 245,842 Debt securities: U.S. treasury securities 441,909 36 (3,160) 438,785 U.S. government agency securities 301,009 35 (3,531) 297,513 Corporate debt securities 106,436 — (817) 105,619 Total debt securities 849,354 71 (7,508) 841,917 Total cash equivalents and debt securities $ 1,095,190 $ 77 $ (7,508) $ 1,087,759 The following table presents gross unrealized losses and fair values for the securities that were in a continuous unrealized loss position as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 Less than 12 months Greater than 12 months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss U.S. treasury securities $ 89,652 $ (687) $ 76,712 $ (934) $ 166,364 $ (1,621) U.S. government agency securities 241,211 (1,701) 39,039 (990) 280,250 (2,691) Corporate debt securities 20,555 (275) 20,596 (275) 41,151 (550) Total $ 351,418 $ (2,663) $ 136,347 $ (2,199) $ 487,765 $ (4,862) December 31, 2022 Less Than 12 Months 12 Months or Greater Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss U.S. treasury securities $ 190,820 $ (1,794) $ 105,115 $ (1,366) $ 295,935 $ (3,160) U.S. government agency securities 220,766 (2,245) 42,754 (1,286) 263,520 (3,531) Corporate debt securities 30,485 (455) 22,864 (362) 53,349 (817) Total $ 442,071 $ (4,494) $ 170,733 $ (3,014) $ 612,804 $ (7,508) The amortized cost and fair value of the available-for-sale debt securities based on contractual maturities are as follows (in thousands): March 31, 2023 Amortized Cost Fair Value Due within one year $ 602,486 $ 598,941 Due after one year but within five years 206,650 205,660 Total $ 809,136 $ 804,601 Accrued interest receivable of $3.2 million and $2.8 million was classified in prepaid expenses and other current assets in the condensed consolidated balance sheet as of March 31, 2023 and December 31, 2022, respectively. In addition to available-for-sale debt securities, marketable securities also include term bond mutual funds, which are measured at fair value. As of March 31, 2023 and December 31, 2022, the fair value of the term bond mutual funds was $1.5 million. The change in fair value of the term bond mutual funds is recorded in interest and other income, net in the condensed consolidated statements of operations. The realized and unrealized gains recognized in the condensed consolidated statements of operations for the term bond mutual funds were not material during the three months ended March 31, 2023 and 2022. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 4. Fair Value Measurements The Company measures its financial assets at fair value each reporting period using a fair value hierarchy that prioritizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: Level 1 —Inputs are observable and reflect quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 —Inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly. Level 3 —Inputs that are unobservable. Money market funds and U.S. treasury securities are classified within Level 1 because they are valued using quoted market prices or alternative pricing sources and models utilizing market observable inputs. Other debt securities and investments are classified within Level 2 if the investments are valued using model driven valuations which use observable inputs such as quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. Available-for-sale debt securities are held by custodians who obtain investment prices from a third-party pricing provider that incorporates standard inputs in various asset price models. The Company did not have any assets or liabilities subject to fair value remeasurement on a nonrecurring basis as of March 31, 2023 and December 31, 2022. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table represents the fair value hierarchy for the Company’s financial assets measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 Fair Value Measured Using Level 1 Level 2 Total Financial assets: Cash equivalents: Money market funds $ 155,266 $ — $ 155,266 U.S. treasury securities 37,806 — 37,806 U.S. government agency securities — 48,814 48,814 Corporate debt securities — 10,474 10,474 Marketable securities: U.S. treasury securities 345,040 — 345,040 U.S. government agency securities — 373,547 373,547 Corporate debt securities — 86,014 86,014 Term bond mutual funds — 1,521 1,521 Total financial assets $ 538,112 $ 520,370 $ 1,058,482 December 31, 2022 Fair Value Measured Using Level 1 Level 2 Total Financial assets: Cash equivalents: Money market funds $ 219,512 $ — $ 219,512 U.S. treasury securities 13,915 — 13,915 U.S. government agency securities — 10,419 10,419 Corporate debt securities — 1,996 1,996 Marketable securities: U.S. treasury securities 438,785 — 438,785 U.S. government agency securities — 297,513 297,513 Corporate debt securities — 105,619 105,619 Term bond mutual funds — 1,488 1,488 Total financial assets $ 672,212 $ 417,035 $ 1,089,247 |
Balance Sheet Components
Balance Sheet Components | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | 5. Balance Sheet Components Property and Equipment, net The following table summarizes property and equipment, net as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 December 31, 2022 Computers $ 16,499 $ 16,552 Capitalized internal-use software 22,769 20,230 Office equipment 3,881 3,744 Furniture and fixtures 8,879 8,881 Motor vehicles 1,140 1,158 Leasehold improvements 5,654 5,654 Construction in progress 158 224 Total property and equipment 58,980 56,443 Less: accumulated depreciation and amortization (34,766) (32,304) Property and equipment, net $ 24,214 $ 24,139 Capitalization of costs associated with internal-use software were $2.5 million and $1.3 million for the three months ended March 31, 2023 and 2022, respectively. Amortization expense of capitalized internal-use software was $1.1 million and $0.7 million for the three months ended March 31, 2023 and 2022, respectively. As of March 31, 2023 and December 31, 2022, the net carrying value of capitalized internal-use software was $12.6 million and $11.2 million, respectively. Depreciation expense was $1.7 million for each of the three month periods ended March 31, 2023 and 2022. Accrued Liabilities The following table summarizes accrued liabilities as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 December 31, 2022 Accrued compensation $ 18,721 $ 20,192 Accrued third-party cloud infrastructure expenses 2,459 2,752 Accrued reseller commissions 6,973 7,731 Accrued advertising and marketing expenses 4,557 4,465 Advanced payments from customers 3,928 3,480 Accrued taxes 6,372 7,730 Operating lease liabilities, current 7,266 6,775 Contributions withheld for employee stock purchase plan 3,836 1,546 Other accrued expenses 4,215 4,337 Total accrued liabilities $ 58,327 $ 59,008 Noncurrent liabilities include $23.4 million and $23.3 million of long term accrued compensation as of March 31, 2023 and December 31, 2022, respectively. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Leases | 6. Leases The Company has operating leases primarily for office space. The leases have remaining lease terms of one The following table presents various components of the lease costs (in thousands): Operating Leases Three Months Ended March 31, 2023 2022 Operating lease cost $ 2,494 $ 1,775 Short-term lease cost 174 315 Variable lease cost 785 669 The weighted-average remaining term of the Company's operating leases and the weighted-average discount rate used to measure the present value of the operating lease liabilities are as follows: Lease Term and Discount Rate March 31, 2023 March 31, 2022 Weighted-average remaining lease term (in years) 4.6 5.6 Weighted-average discount rate 7.8 % 7.7 % The following table presents supplemental information arising from lease transactions. Cash payments related to short-term leases are not included in the measurement of the operating lease liabilities, and as such, are excluded from the amounts below (in thousands): Three Months Ended March 31, Supplemental Cash Flow Information: 2023 2022 Cash payments included in the measurement of operating lease liabilities $ 2,326 $ 2,724 Operating ROU assets obtained in exchange for lease obligations — 5,324 As of March 31, 2023, maturities of the operating lease liabilities are as follows (in thousands): Operating Leases Remainder of 2023 $ 6,907 2024 9,761 2025 8,795 2026 5,533 2027 4,235 Thereafter 5,800 Total lease payments 41,032 Less: imputed interest (7,583) Present value of operating lease liabilities $ 33,449 |
Commitment and Contingencies
Commitment and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 7. Commitments and Contingencies Other Contractual Commitments The Company's other contractual commitments primarily consist of third-party cloud infrastructure agreements and service subscription purchase arrangements used to support operations at the enterprise level. As of March 31, 2023, other contractual commitments totaling $93.0 million remain outstanding under these agreements through 2025. Litigation and Loss Contingencies On November 1, 2022, a purported Company stockholder filed a securities class action complaint in the U.S. District Court for the Northern District of California against the Company, certain of its current officers and directors, and underwriters of the Company's initial public offering (IPO). On April 14, 2023, the court appointed lead plaintiff filed a consolidated amended class action complaint. The complaint alleges that defendants violated Sections 11, 12(a)(2), and 15 of the Securities Act of 1933 by making material misstatements or omissions in offering documents filed in connection with the IPO. The complaint seeks unspecified damages, interest, fees, costs, and rescission on behalf of purchasers and/or acquirers of common stock issued in the IPO. The Company and the other defendants intend to vigorously defend against the claims in this action. On March 20, 2023, a purported stockholder derivative complaint was filed in the U.S. District Court for the Northern District of California. The complaint names as defendants the Company’s current directors, as well as the Company as nominal defendant, and asserts state and federal claims based on some of the same alleged misstatements as the securities class action complaint. The derivative complaint seeks unspecified damages, attorneys’ fees, and other costs. The Company and the other defendants intend to vigorously defend against the claims in this action. From time to time, the Company has been and may be in the future subject to other legal proceedings, claims, investigations, and government inquiries (collectively, Legal Proceedings) in the ordinary course of business. It has received and may receive claims from third parties asserting, among other things, infringement of their intellectual property rights, defamation, labor and employment rights, privacy, and contractual rights. There are no currently pending legal proceedings that the Company believes will have a material adverse impact on the business or condensed consolidated financial statements. Indemnifications In the ordinary course of business, the Company enters into contractual arrangements under which the Company agrees to provide indemnification of varying scope and terms to customers, business partners, and other parties with respect to certain matters, including losses arising out of intellectual property infringement claims made by third parties, if the Company has violated applicable laws, if the Company is negligent or commits acts of willful misconduct, and other liabilities with respect to its products and services and its business. In these circumstances, payment is typically conditional on the other party making a claim pursuant to the procedures specified in the particular contract. The Company also indemnifies certain of its officers, directors and certain key employees while they are serving in good faith in their respective capacities. To date, the Company has not incurred any material costs as a result of such indemnifications and has not accrued any liabilities related to such obligations in its condensed consolidated financial statements. |
Stockholders' Equity and Stock
Stockholders' Equity and Stock Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity and Stock-Based Compensation | 8. Stockholders' Equity and Stock-Based Compensation Equity Compensation Plans In August 2021, the board of directors (the Board) adopted the 2021 Equity Incentive Plan (the 2021 Plan) and the 2021 Employee Stock Purchase Plan (ESPP), effective upon the IPO. Pursuant to the 2021 Plan, the Board may grant incentive stock options to purchase shares of the Company’s common stock, non-statutory stock options to purchase shares of the Company’s common stock, stock appreciation rights, restricted stock, RSUs, performance awards (PRSUs) and other awards. The ESPP enables eligible employees to purchase shares of the Company's Class A common stock. Both the 2021 Plan and ESPP include an automatic increase to their shares reserve on January 1 of each year as set forth in the respective plan documents. In August 2022, the Board adopted the 2022 Inducement Plan (the Inducement Plan) in accordance with Listing Rule 5635(c)(4) of the Nasdaq Stock Market. Under the Inducement Plan, nonstatutory stock options, stock appreciation rights, restricted stock, RSUs, PRSUs and other awards may be granted as an inducement material for eligible persons to enter into employment with the Company. Shares of common stock reserved for future issuance were as follows (in thousands): March 31, 2023 2011 Stock Plan: Options, RSUs and PRSUs outstanding 19,180 2021 Equity Incentive Plan: Options and RSUs outstanding 10,747 Shares reserved for future award issuances 66,768 2022 Inducement Plan: Options and RSUs outstanding 3,509 Shares reserved for future award issuances 6,491 2021 Employee Stock Purchase Plan 11,181 Total shares of common stock reserved for issuance 117,876 2021 Employee Stock Purchase Plan Under the ESPP, the price at which common stock is purchased is equal to 85% of the fair market value of a share of the Company’s common stock on the first day of the offering period or the applicable purchase date, whichever is lower. The fair market value of common stock will generally be the closing sales price on the determination date. The ESPP provides an offering period of 24 months, with four purchase periods that are generally six months long and end on May 15 and November 15 of each year, except for the first purchase period, which began upon the completion of the IPO in September 2021 and ended on May 13, 2022. The ESPP also includes a reset provision for the purchase price if the fair market value of a share of the Company's common stock on the first day of any purchase period is less than or equal to the fair market value of a share of the Company's common stock on the first day of an ongoing offering. If the reset provision is triggered, a new 24-month offering period begins. The reset provision under the ESPP was triggered on May 16, 2022, and again on November 16, 2022. Each triggering of the reset provision was considered a modification in accordance with ASC 718, Stock Based Compensation , with the modification charge recognized on a straight-line basis over the new offering period. The modification did not have a material effect on the Company's stock-based compensation expense during the three months ended March 31, 2023. During the three months ended March 31, 2023 and 2022, the Company recognized $2.0 million and $3.2 million of stock-based compensation expense related to the ESPP, respectively. Stock Options Stock options are generally granted with an exercise price equal to the stock’s fair market value at the date of grant, have a 10-year contractual term, and vest over a four-year period. Share Information: Number of Shares (in thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) (1) Balance as of December 31, 2022 2,758 $ 9.06 7.3 $ 15,595 Stock options exercised (19) $ 0.31 Stock options cancelled / forfeited / expired (3) $ 0.16 Balance as of March 31, 2023 2,736 $ 9.12 7.1 $ 17,062 Options vested and expected to vest as of March 31, 2023 2,736 $ 9.12 7.1 $ 17,062 Options exercisable as of March 31, 2023 920 $ 0.27 2.4 $ 13,884 (1) Aggregate intrinsic value for stock options represents the difference between the exercise price and the per share fair value of the Company’s common stock as of the end of the period, multiplied by the number of stock options outstanding, exercisable, or vested. Restricted Stock Units RSUs are granted at fair market value at the date of the grant and vest over a four-year period. RSU activity, which includes PRSUs, during the three months ended March 31, 2023 is as follows: Share Information: Number of Shares Weighted-Average Grant Date Fair Value Per Share (in thousands, except per share data) Unvested, as of December 31, 2022 32,253 $ 18.86 Granted 1,540 $ 14.54 Vested (1) (2,261) $ 17.23 Forfeited (832) $ 17.39 Unvested, as of March 31, 2023 30,700 $ 18.80 (1) During the three months ended March 31, 2023, total shares that vested were 2.3 million, of which 0.8 million were withheld for tax purposes. The total fair value of vested RSUs during the three months ended March 31, 2023 and 2022 was $39.0 million and $106.6 million, respectively. Performance-Based Awards In May 2019, the Board approved a grant of 166,390 shares of PRSUs to the Company’s Chief Executive Officer (CEO). The vesting of these PRSUs is contingent upon the satisfaction of certain milestones. The revenue-related milestone and the liquidity event condition were met prior to December 31, 2021. As of March 31, 2023, the time-based vesting was the only condition yet to be satisfied over the remaining requisite service period, and the number of shares to vest subject to this condition is insignificant. In September 2021, the Board approved a grant of 6,000,000 PRSUs to the Company's CEO with a time-based service condition beginning January 1, 2022, and a market condition involving five separate stock price targets ranging from $70.00 to $200.00 per share for each of the five vesting tranches (CEO Performance Award). These stock price targets will be measured based on the average closing price over a consecutive 60-trading day period, beginning on the first trading day after the expiration of the final lock-up period in February 2022. The vesting of the CEO Performance Award is contingent upon the completion of the requisite service through January 1, 2029 and the achievement of the specified stock price target in each tranche on or before January 1, 2029. The stock price targets are not required to be achieved within the service period of each tranche, and accordingly, multiple tranches can vest at the same date if the specified stock price targets are achieved after December 31, 2025. The CEO Performance Award had a total grant date fair value of $131.0 million. The fair value of the CEO Performance Award was determined at grant date by using the Monte Carlo simulation model, which requires certain complex valuation assumption inputs such as measurement period, expected stock price volatility, risk-free interest rate and dividend yield. The Company recognized stock-based compensation expense associated with PRSUs granted to the CEO of $6.9 million and $6.9 million for the three months ended March 31, 2023 and 2022, respectively. These expenses were recorded in general and administrative expenses in the condensed consolidated statements of operations. Stock-Based Compensation Total stock-based compensation expense recorded for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cost of revenue $ 1,696 $ 1,526 Research and development 8,979 8,309 Sales and marketing (1) 15,756 12,536 General and administrative (2) 24,263 24,254 Stock-based compensation, net of amounts capitalized 50,694 46,625 Capitalized stock-based compensation 514 — Total stock-based compensation expense $ 51,208 $ 46,625 (1) Sales and marketing expense for the three months ended March 31, 2023 includes $2.4 million of stock-based compensation expense related to RSUs, options and ESPP purchase rights granted to the President of the Company. (2) General and administrative expense includes $13.8 million and $13.8 million of stock-based compensation expense associated with RSUs and PRSUs primarily granted to the CEO in September 2021 for the three months ended March 31, 2023 and 2022, respectively. As of March 31, 2023, unrecognized stock-based compensation expense related to unvested stock-based awards was as follows (in thousands, except for period data): March 31, 2023 Unrecognized Stock-Based Compensation Weighted-Average Period to Recognize Expense RSUs and PRSUs $ 491,190 2.9 Stock options 12,834 3.4 ESPP 10,027 1.0 Total unrecognized stock-based compensation expense $ 514,051 |
Net Loss Per Share
Net Loss Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 9. Net Loss Per Share Basic net loss per share attributable to common stockholders is computed by dividing the net loss by the number of weighted-average outstanding common shares. Diluted net loss per share attributable to common stockholders is determined by giving effect to all potential common equivalents during the reporting period, unless including them yields an antidilutive result. The Company considers its stock options and RSUs as potential common stock equivalents, but excluded them from the computation of diluted net loss per share attributable to common stockholders for the three months ended March 31, 2023 and 2022, as their effect was antidilutive. The rights, including the liquidation and dividend rights, of the holders of Class A and Class B common stock are identical, except with respect to voting, conversion, and transfer rights. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis to each class of common stock and the resulting basic and diluted net loss per share attributable to common stockholders, are the same for both Class A and Class B common stock on both an individual and combined basis. The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except per share data): Three Months Ended March 31, 2023 2022 Numerator: Net loss $ (42,664) $ (49,059) Denominator: Weighted-average shares used in computing net loss per share attributable to Class A and Class B common stockholders - basic and diluted 290,133 278,186 Net loss per share attributable to Class A and Class B common stockholders - basic and diluted $ (0.15) $ (0.18) The following table summarizes the potential common equivalents that were excluded from the computation of diluted net loss per share attributable to Class A and Class B common stockholders for the periods presented (in thousands): Three Months Ended March 31, 2023 2022 RSUs and PRSUs 30,700 32,238 Stock options 2,736 1,236 ESPP 294 409 Total 33,730 33,883 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. Income Taxes The Company's quarterly tax provision and estimates of its annual effective tax rate are estimates due to several factors, including changes in pre-tax income (or loss), the mix of jurisdictions to which such income relates, discrete items (such as windfalls or shortfalls from stock-based compensation) in the period offset with our valuation allowance. The provision for income taxes was $4.0 million |
Geographic Information
Geographic Information | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Geographic Information | 11. Geographic Information The following table summarizes revenue by geographic location (in thousands): Three Months Ended March 31, 2023 2022 North America $ 61,067 $ 48,773 Europe, Middle East and Africa 52,866 45,505 Asia Pacific 20,025 17,479 Other 3,734 2,880 Total revenue $ 137,692 $ 114,637 Revenue from North America consists primarily of revenue from the United States. For the three months ended March 31, 2023 and 2022, revenue generated from the United States was $53.9 million and $42.8 million, or 39% and 37% of total consolidated revenue, respectively. The United Kingdom, included within Europe, Middle East and Africa in the table above, contributed $17.1 million and $14.9 million or 12% and 13% of total consolidated revenue for the three months ended March 31, 2023 and 2022, respectively. Long-lived assets consist primarily of property, plant and equipment and ROU assets. The following table summarizes long-lived assets by geographic information (in thousands): March 31, 2023 December 31, 2022 North America $ 24,329 $ 23,839 Europe, Middle East and Africa 3,584 4,039 Asia Pacific 27,476 29,285 Total long-lived assets $ 55,389 $ 57,163 Long-lived assets in North America are primarily located in the United States, and long lived assets in Asia Pacific are primarily located in India. |
Business, Basis of Presentati_2
Business, Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Principles of Consolidation | The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, and all intercompany balances and transactions have been eliminated in consolidation. |
Unaudited Interim Consolidated Financial Statements | The accompanying condensed consolidated balance sheet as of March 31, 2023, the condensed consolidated statements of operations, of comprehensive loss, of cash flows, and of stockholders’ equity for the three months ended March 31, 2023 and 2022, and the related notes to such condensed consolidated financial statements are unaudited. These unaudited condensed consolidated financial statements are presented in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (SEC) and do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. In management’s opinion, the unaudited condensed consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of March 31, 2023 and its results of operations and cash flows for the three months ended March 31, 2023 and 2022. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year or any other future interim or annual period. The condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on February 23, 2023. |
Use of Estimates | The preparation of the condensed consolidated financial statements in accordance with 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 consolidated financial statements, and the reported amounts of income and expense during the reporting periods. Significant items subject to such estimates and assumptions include, but are not limited to, the following: • determination of standalone selling price (SSP) for each distinct performance obligation included in customer contracts with multiple performance obligations; • allowance for doubtful accounts; • expected benefit period of deferred contract acquisition costs; • capitalization of internal-use software development costs; • fair value of acquired intangible assets and goodwill; • useful lives of long-lived assets; • valuation of deferred tax assets; • valuation of employee defined benefit plan; • fair value of share-based awards, including performance-based awards; and • incremental borrowing rate used for operating leases. |
Concentrations of Risk | Financial instruments that potentially expose the Company to significant concentration of credit risk consist primarily of cash, cash equivalents, marketable securities, and accounts receivable. The Company’s cash, cash equivalents and marketable securities are generally held with large financial institutions and are in excess of the federally insured limits provided on such deposits. In addition, the Company has cash and cash equivalents held in international bank accounts, which are denominated primarily in Euros, British Pounds, and Indian Rupees. There were no customers that individually exceeded 10% of the Company’s revenue for the three months ended March 31, 2023 and 2022 or that represented 10% or more of the Company’s consolidated accounts receivable balance as of March 31, 2023. The Company primarily relies upon its third-party cloud infrastructure partner, Amazon Web Services, to serve customers and operate certain aspects of its services. Any disruption of this cloud infrastructure partner would impact the Company's operations and its business could be adversely impacted. |
Derivative Instruments | The Company enters into foreign currency forward contracts, most of which were designated as cash flow hedges, in order to manage the volatility of cash flows that relate to cost of revenues and operating expenses denominated in Indian Rupee. All derivative instruments are measured at fair value based upon quoted market prices for comparable instruments and as such, classified within Level 2 of the fair value hierarchy. Derivative assets and liabilities are presented on a gross basis on the condensed consolidated balance sheets under prepaid expenses and other current assets and accrued liabilities, respectively. Gains or losses related to cash flow hedges are recorded as a component of accumulated other comprehensive income (AOCI) on the condensed consolidated statements of stockholders' equity until the forecasted transaction occurs in earnings. When the forecasted transaction occurs, the related gains and losses are reclassified into earnings within the financial statement line item associated with the underlying hedged transaction. If the underlying hedged transaction does not occur, or it becomes probable that the hedged transaction will not occur, the cumulative unrealized gain or loss is reclassified immediately from AOCI into earnings within interest and other income. Changes in the fair value of currency forward exchange contracts due to changes in time value were excluded from the assessment of effectiveness. The initial value of this excluded component is amortized on a straight-line basis over the life of the hedging instrument and recognized in the f inancial statement line item to which the hedge relates. A majority of the balance related to foreign exchange derivative instruments included in AOCI at March 31, 2023 is expected to be reclassified into earnings within 12 months. Derivative instruments are classified in the condensed consolidated statements of cash flows as cash from operating activities, which reflect the classification of the underlying hedged transactions. The Company does not use derivative financial instruments for trading or speculative purposes. As of March 31, 2023, the total notional amount of outstanding designated foreign currency forward contracts was $22.3 million. The fair value of derivative assets and liabilities as of March 31, 2023, and all related unrealized and realized gains and losses during the three months ended March 31, 2023 were not material. Entering into derivative instruments exposes the Company to credit risk to the extent that the counterparties are unable to meet the terms of the contract. The Company mitigates this credit risk by transacting with major financial institutions with high credit ratings. In addition, the Company has entered into master netting arrangements that mitigates credit risk by permitting net settlement of transactions. As such, the Company's exposure is not considered significant. The Company does not have any collateral requirements with its counterparties. |
Recent Accounting Pronouncements | There have been no recently issued accounting pronouncements that are expected to have a material impact on the Company's condensed consolidated financial statements. |
Revenue | The Company derives revenue from subscription fees and related professional services. The Company sells subscriptions for its cloud-based solutions directly to customers and indirectly through channel partners through arrangements that are non-cancelable and non-refundable. The Company’s subscription arrangements do not provide customers with the right to take possession of the software supporting the solutions and, as a result, are accounted for as service arrangements. The Company records revenue net of sales or value-added taxes. |
Fair Value Measurements | The Company measures its financial assets at fair value each reporting period using a fair value hierarchy that prioritizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: Level 1 —Inputs are observable and reflect quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 —Inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly. Level 3 —Inputs that are unobservable. |
Revenue From Contracts with C_2
Revenue From Contracts with Customers (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenues | The following table summarizes revenue by the Company’s service offerings (in thousands): Three Months Ended March 31, 2023 2022 Subscription services $ 134,023 $ 111,397 Professional services 3,669 3,240 Total revenue $ 137,692 $ 114,637 |
Summary of Changes in the Balance of Deferred Contract Acquisition Costs | The change in the balance of deferred contract acquisition costs during the periods presented is as follows (in thousands): Three Months Ended March 31, 2023 2022 Balance at beginning of the period $ 39,675 $ 29,647 Add: Contract costs capitalized during the period 5,568 5,600 Less: Amortization of contract costs during the period (5,617) (4,275) Balance at end of the period $ 39,626 $ 30,972 |
Cash Equivalents and Marketab_2
Cash Equivalents and Marketable Securities (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Available-for-sale Securities Reconciliation | Cash equivalents and available-for-sale debt securities consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: Money market funds $ 155,266 $ — $ — $ 155,266 U.S. treasury securities 37,797 9 — 37,806 U.S. government agency securities 48,796 18 — 48,814 Corporate debt securities 10,474 — — 10,474 Total cash equivalents 252,333 27 — 252,360 Debt securities: U.S. treasury securities 346,566 95 (1,621) 345,040 U.S. government agency securities 376,006 232 (2,691) 373,547 Corporate debt securities 86,564 — (550) 86,014 Total debt securities 809,136 327 (4,862) 804,601 Total cash equivalents and debt securities $ 1,061,469 $ 354 $ (4,862) $ 1,056,961 December 31, 2022 Amortized Cost Unrealized Gains Unrealized Losses Fair Value Cash equivalents: Money market funds $ 219,512 $ — $ — $ 219,512 U.S. treasury securities 13,912 3 — 13,915 U.S. government agency securities 10,417 2 — 10,419 Corporate debt securities 1,995 1 — 1,996 Total cash equivalents 245,836 6 — 245,842 Debt securities: U.S. treasury securities 441,909 36 (3,160) 438,785 U.S. government agency securities 301,009 35 (3,531) 297,513 Corporate debt securities 106,436 — (817) 105,619 Total debt securities 849,354 71 (7,508) 841,917 Total cash equivalents and debt securities $ 1,095,190 $ 77 $ (7,508) $ 1,087,759 |
Schedule of Available-for-Sale, Unrealized Loss Position, Fair Value | The following table presents gross unrealized losses and fair values for the securities that were in a continuous unrealized loss position as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 Less than 12 months Greater than 12 months Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss U.S. treasury securities $ 89,652 $ (687) $ 76,712 $ (934) $ 166,364 $ (1,621) U.S. government agency securities 241,211 (1,701) 39,039 (990) 280,250 (2,691) Corporate debt securities 20,555 (275) 20,596 (275) 41,151 (550) Total $ 351,418 $ (2,663) $ 136,347 $ (2,199) $ 487,765 $ (4,862) December 31, 2022 Less Than 12 Months 12 Months or Greater Total Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss U.S. treasury securities $ 190,820 $ (1,794) $ 105,115 $ (1,366) $ 295,935 $ (3,160) U.S. government agency securities 220,766 (2,245) 42,754 (1,286) 263,520 (3,531) Corporate debt securities 30,485 (455) 22,864 (362) 53,349 (817) Total $ 442,071 $ (4,494) $ 170,733 $ (3,014) $ 612,804 $ (7,508) |
Schedule of Amortized Costs and Fair Value of Debt Securities Based on Contractual Maturities | The amortized cost and fair value of the available-for-sale debt securities based on contractual maturities are as follows (in thousands): March 31, 2023 Amortized Cost Fair Value Due within one year $ 602,486 $ 598,941 Due after one year but within five years 206,650 205,660 Total $ 809,136 $ 804,601 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table represents the fair value hierarchy for the Company’s financial assets measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 Fair Value Measured Using Level 1 Level 2 Total Financial assets: Cash equivalents: Money market funds $ 155,266 $ — $ 155,266 U.S. treasury securities 37,806 — 37,806 U.S. government agency securities — 48,814 48,814 Corporate debt securities — 10,474 10,474 Marketable securities: U.S. treasury securities 345,040 — 345,040 U.S. government agency securities — 373,547 373,547 Corporate debt securities — 86,014 86,014 Term bond mutual funds — 1,521 1,521 Total financial assets $ 538,112 $ 520,370 $ 1,058,482 December 31, 2022 Fair Value Measured Using Level 1 Level 2 Total Financial assets: Cash equivalents: Money market funds $ 219,512 $ — $ 219,512 U.S. treasury securities 13,915 — 13,915 U.S. government agency securities — 10,419 10,419 Corporate debt securities — 1,996 1,996 Marketable securities: U.S. treasury securities 438,785 — 438,785 U.S. government agency securities — 297,513 297,513 Corporate debt securities — 105,619 105,619 Term bond mutual funds — 1,488 1,488 Total financial assets $ 672,212 $ 417,035 $ 1,089,247 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Property, Plant and Equipment | The following table summarizes property and equipment, net as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 December 31, 2022 Computers $ 16,499 $ 16,552 Capitalized internal-use software 22,769 20,230 Office equipment 3,881 3,744 Furniture and fixtures 8,879 8,881 Motor vehicles 1,140 1,158 Leasehold improvements 5,654 5,654 Construction in progress 158 224 Total property and equipment 58,980 56,443 Less: accumulated depreciation and amortization (34,766) (32,304) Property and equipment, net $ 24,214 $ 24,139 |
Schedule of Accrued Liabilities | Accrued Liabilities The following table summarizes accrued liabilities as of March 31, 2023 and December 31, 2022 (in thousands): March 31, 2023 December 31, 2022 Accrued compensation $ 18,721 $ 20,192 Accrued third-party cloud infrastructure expenses 2,459 2,752 Accrued reseller commissions 6,973 7,731 Accrued advertising and marketing expenses 4,557 4,465 Advanced payments from customers 3,928 3,480 Accrued taxes 6,372 7,730 Operating lease liabilities, current 7,266 6,775 Contributions withheld for employee stock purchase plan 3,836 1,546 Other accrued expenses 4,215 4,337 Total accrued liabilities $ 58,327 $ 59,008 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Lease, Cost | The following table presents various components of the lease costs (in thousands): Operating Leases Three Months Ended March 31, 2023 2022 Operating lease cost $ 2,494 $ 1,775 Short-term lease cost 174 315 Variable lease cost 785 669 The weighted-average remaining term of the Company's operating leases and the weighted-average discount rate used to measure the present value of the operating lease liabilities are as follows: Lease Term and Discount Rate March 31, 2023 March 31, 2022 Weighted-average remaining lease term (in years) 4.6 5.6 Weighted-average discount rate 7.8 % 7.7 % The following table presents supplemental information arising from lease transactions. Cash payments related to short-term leases are not included in the measurement of the operating lease liabilities, and as such, are excluded from the amounts below (in thousands): Three Months Ended March 31, Supplemental Cash Flow Information: 2023 2022 Cash payments included in the measurement of operating lease liabilities $ 2,326 $ 2,724 Operating ROU assets obtained in exchange for lease obligations — 5,324 |
Lessee, Operating Lease, Liability, Maturity | As of March 31, 2023, maturities of the operating lease liabilities are as follows (in thousands): Operating Leases Remainder of 2023 $ 6,907 2024 9,761 2025 8,795 2026 5,533 2027 4,235 Thereafter 5,800 Total lease payments 41,032 Less: imputed interest (7,583) Present value of operating lease liabilities $ 33,449 |
Stockholders' Equity and Stoc_2
Stockholders' Equity and Stock Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Summary of Common Shares Reserved for Future Issuance | Shares of common stock reserved for future issuance were as follows (in thousands): March 31, 2023 2011 Stock Plan: Options, RSUs and PRSUs outstanding 19,180 2021 Equity Incentive Plan: Options and RSUs outstanding 10,747 Shares reserved for future award issuances 66,768 2022 Inducement Plan: Options and RSUs outstanding 3,509 Shares reserved for future award issuances 6,491 2021 Employee Stock Purchase Plan 11,181 Total shares of common stock reserved for issuance 117,876 |
Schedule of Stock Option Activity | Share Information: Number of Shares (in thousands) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (in thousands) (1) Balance as of December 31, 2022 2,758 $ 9.06 7.3 $ 15,595 Stock options exercised (19) $ 0.31 Stock options cancelled / forfeited / expired (3) $ 0.16 Balance as of March 31, 2023 2,736 $ 9.12 7.1 $ 17,062 Options vested and expected to vest as of March 31, 2023 2,736 $ 9.12 7.1 $ 17,062 Options exercisable as of March 31, 2023 920 $ 0.27 2.4 $ 13,884 (1) Aggregate intrinsic value for stock options represents the difference between the exercise price and the per share fair value of the Company’s common stock as of the end of the period, multiplied by the number of stock options outstanding, exercisable, or vested. |
Schedule of Restricted Stock Unit Activity | RSU activity, which includes PRSUs, during the three months ended March 31, 2023 is as follows: Share Information: Number of Shares Weighted-Average Grant Date Fair Value Per Share (in thousands, except per share data) Unvested, as of December 31, 2022 32,253 $ 18.86 Granted 1,540 $ 14.54 Vested (1) (2,261) $ 17.23 Forfeited (832) $ 17.39 Unvested, as of March 31, 2023 30,700 $ 18.80 (1) During the three months ended March 31, 2023, total shares that vested were 2.3 million, of which 0.8 million were withheld for tax purposes. |
Stock-based Compensation Expense | Total stock-based compensation expense recorded for the three months ended March 31, 2023 and 2022 was as follows (in thousands): Three Months Ended March 31, 2023 2022 Cost of revenue $ 1,696 $ 1,526 Research and development 8,979 8,309 Sales and marketing (1) 15,756 12,536 General and administrative (2) 24,263 24,254 Stock-based compensation, net of amounts capitalized 50,694 46,625 Capitalized stock-based compensation 514 — Total stock-based compensation expense $ 51,208 $ 46,625 (1) Sales and marketing expense for the three months ended March 31, 2023 includes $2.4 million of stock-based compensation expense related to RSUs, options and ESPP purchase rights granted to the President of the Company. (2) General and administrative expense includes $13.8 million and $13.8 million of stock-based compensation expense associated with RSUs and PRSUs primarily granted to the CEO in September 2021 for the three months ended March 31, 2023 and 2022, respectively. |
Share-based Payment Arrangement, Nonvested Award, Cost | As of March 31, 2023, unrecognized stock-based compensation expense related to unvested stock-based awards was as follows (in thousands, except for period data): March 31, 2023 Unrecognized Stock-Based Compensation Weighted-Average Period to Recognize Expense RSUs and PRSUs $ 491,190 2.9 Stock options 12,834 3.4 ESPP 10,027 1.0 Total unrecognized stock-based compensation expense $ 514,051 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except per share data): Three Months Ended March 31, 2023 2022 Numerator: Net loss $ (42,664) $ (49,059) Denominator: Weighted-average shares used in computing net loss per share attributable to Class A and Class B common stockholders - basic and diluted 290,133 278,186 Net loss per share attributable to Class A and Class B common stockholders - basic and diluted $ (0.15) $ (0.18) |
Schedule of Potential Common Equivalents Excluded from Computation of Diluted Net Loss per Share | The following table summarizes the potential common equivalents that were excluded from the computation of diluted net loss per share attributable to Class A and Class B common stockholders for the periods presented (in thousands): Three Months Ended March 31, 2023 2022 RSUs and PRSUs 30,700 32,238 Stock options 2,736 1,236 ESPP 294 409 Total 33,730 33,883 |
Geographic Information (Tables)
Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Long-Lived Assets by Geographical Region | The following table summarizes revenue by geographic location (in thousands): Three Months Ended March 31, 2023 2022 North America $ 61,067 $ 48,773 Europe, Middle East and Africa 52,866 45,505 Asia Pacific 20,025 17,479 Other 3,734 2,880 Total revenue $ 137,692 $ 114,637 March 31, 2023 December 31, 2022 North America $ 24,329 $ 23,839 Europe, Middle East and Africa 3,584 4,039 Asia Pacific 27,476 29,285 Total long-lived assets $ 55,389 $ 57,163 |
Business, Basis of Presentati_3
Business, Basis of Presentation and Summary of Significant Accounting Policies (Details) $ in Millions | Mar. 31, 2023 USD ($) |
Foreign Exchange Forward | |
Derivative [Line Items] | |
Notional amount | $ 22.3 |
Revenue From Contracts with C_3
Revenue From Contracts with Customers - Disaggregation of Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 137,692 | $ 114,637 |
Subscription services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 134,023 | 111,397 |
Professional services | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 3,669 | $ 3,240 |
Revenue From Contracts with C_4
Revenue From Contracts with Customers - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Revenue recognized during the period | $ 93.7 | $ 72.2 |
Remaining performance obligation | 325.6 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||
Remaining performance obligation | $ 253.7 | |
Remaining performance obligation, expected timing of satisfaction, period | 12 months |
Revenue From Contracts with C_5
Revenue From Contracts with Customers - Deferred Contract Acquisition Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Change in Deferred Contract Acquisition Costs [Roll Forward] | ||
Balance at beginning of the period | $ 39,675 | $ 29,647 |
Add: Contract costs capitalized during the period | 5,568 | 5,600 |
Less: Amortization of contract costs during the period | (5,617) | (4,275) |
Balance at end of the period | $ 39,626 | $ 30,972 |
Cash Equivalents and Marketab_3
Cash Equivalents and Marketable Securities - Schedule of Carrying Amounts and Fair Values of Debt Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Securities, Available-for-sale [Line Items] | ||
Unrealized Gains | $ 354 | $ 77 |
Unrealized Losses | (4,862) | (7,508) |
Cash Equivalents and Available-for-sale Debt Securities | ||
Amortized Cost | 1,061,469 | 1,095,190 |
Fair Value | 1,056,961 | 1,087,759 |
Cash Equivalents | ||
Debt Securities, Available-for-sale [Line Items] | ||
Unrealized Gains | 27 | 6 |
Unrealized Losses | 0 | 0 |
Cash Equivalents and Available-for-sale Debt Securities | ||
Amortized Cost | 252,333 | 245,836 |
Fair Value | 252,360 | 245,842 |
Cash Equivalents | U.S. treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities, Amortized Cost | 37,797 | 13,912 |
Unrealized Gains | 9 | 3 |
Unrealized Losses | 0 | 0 |
Fair Value | 37,806 | 13,915 |
Cash Equivalents | U.S. government agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities, Amortized Cost | 48,796 | 10,417 |
Unrealized Gains | 18 | 2 |
Unrealized Losses | 0 | 0 |
Fair Value | 48,814 | 10,419 |
Cash Equivalents | Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities, Amortized Cost | 10,474 | 1,995 |
Unrealized Gains | 0 | 1 |
Unrealized Losses | 0 | 0 |
Fair Value | 10,474 | 1,996 |
Marketable Securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities, Amortized Cost | 809,136 | 849,354 |
Unrealized Gains | 327 | 71 |
Unrealized Losses | (4,862) | (7,508) |
Fair Value | 804,601 | 841,917 |
Marketable Securities | U.S. treasury securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities, Amortized Cost | 346,566 | 441,909 |
Unrealized Gains | 95 | 36 |
Unrealized Losses | (1,621) | (3,160) |
Fair Value | 345,040 | 438,785 |
Marketable Securities | U.S. government agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities, Amortized Cost | 376,006 | 301,009 |
Unrealized Gains | 232 | 35 |
Unrealized Losses | (2,691) | (3,531) |
Fair Value | 373,547 | 297,513 |
Marketable Securities | Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Debt securities, Amortized Cost | 86,564 | 106,436 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | (550) | (817) |
Fair Value | 86,014 | 105,619 |
Money market funds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash Equivalents | $ 155,266 | $ 219,512 |
Cash Equivalents and Marketab_4
Cash Equivalents and Marketable Securities - Schedule of Continuous Unrealized Loss Position and Fair Values of Debt Securities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value | ||
Less than 12 months | $ 351,418 | $ 442,071 |
Greater than 12 months | 136,347 | 170,733 |
Total | 487,765 | 612,804 |
Unrealized Loss | ||
Less than 12 months | (2,663) | (4,494) |
Greater than 12 months | (2,199) | (3,014) |
Total | (4,862) | (7,508) |
U.S. treasury securities | ||
Fair Value | ||
Less than 12 months | 89,652 | 190,820 |
Greater than 12 months | 76,712 | 105,115 |
Total | 166,364 | 295,935 |
Unrealized Loss | ||
Less than 12 months | (687) | (1,794) |
Greater than 12 months | (934) | (1,366) |
Total | (1,621) | (3,160) |
U.S. government agency securities | ||
Fair Value | ||
Less than 12 months | 241,211 | 220,766 |
Greater than 12 months | 39,039 | 42,754 |
Total | 280,250 | 263,520 |
Unrealized Loss | ||
Less than 12 months | (1,701) | (2,245) |
Greater than 12 months | (990) | (1,286) |
Total | (2,691) | (3,531) |
Corporate debt securities | ||
Fair Value | ||
Less than 12 months | 20,555 | 30,485 |
Greater than 12 months | 20,596 | 22,864 |
Total | 41,151 | 53,349 |
Unrealized Loss | ||
Less than 12 months | (275) | (455) |
Greater than 12 months | (275) | (362) |
Total | $ (550) | $ (817) |
Cash Equivalents and Marketab_5
Cash Equivalents and Marketable Securities - Amortized Cost and Fair Value Based on Contractual Maturities (Details) - Marketable Securities - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Amortized Cost | ||
Due within one year | $ 602,486 | |
Due after one year but within five years | 206,650 | |
Debt securities, Amortized Cost | 809,136 | $ 849,354 |
Fair Value | ||
Due within one year | 598,941 | |
Due after one year but within five years | 205,660 | |
Total | $ 804,601 | $ 841,917 |
Cash Equivalents and Marketab_6
Cash Equivalents and Marketable Securities - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Debt Securities, Available-for-sale [Line Items] | ||
Accrued interest | $ 3.2 | $ 2.8 |
Mutual funds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Equity securities | $ 1.5 | $ 1.5 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured on Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 1,058,482 | $ 1,089,247 |
U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 345,040 | 438,785 |
U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 373,547 | 297,513 |
Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 86,014 | 105,619 |
Term bond mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 1,521 | 1,488 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 155,266 | 219,512 |
U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 37,806 | 13,915 |
U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 48,814 | 10,419 |
Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 10,474 | 1,996 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | 538,112 | 672,212 |
Level 1 | U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 345,040 | 438,785 |
Level 1 | U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Level 1 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Level 1 | Term bond mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Level 1 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 155,266 | 219,512 |
Level 1 | U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 37,806 | 13,915 |
Level 1 | U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | 0 |
Level 1 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | 520,370 | 417,035 |
Level 2 | U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 0 | 0 |
Level 2 | U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 373,547 | 297,513 |
Level 2 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 86,014 | 105,619 |
Level 2 | Term bond mutual funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 1,521 | 1,488 |
Level 2 | Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | 0 |
Level 2 | U.S. treasury securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 0 | 0 |
Level 2 | U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 48,814 | 10,419 |
Level 2 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | $ 10,474 | $ 1,996 |
Balance Sheet Components - Prop
Balance Sheet Components - Property, Plant, and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 58,980 | $ 56,443 |
Less: accumulated depreciation and amortization | (34,766) | (32,304) |
Property and equipment, net | 24,214 | 24,139 |
Computers | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 16,499 | 16,552 |
Capitalized internal-use software | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 22,769 | 20,230 |
Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 3,881 | 3,744 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 8,879 | 8,881 |
Motor vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 1,140 | 1,158 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | 5,654 | 5,654 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment | $ 158 | $ 224 |
Balance Sheet Components - Narr
Balance Sheet Components - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Capitalized costs | $ 2.5 | $ 1.3 | |
Amortization expense | 1.1 | 0.7 | |
Net carrying value | 12.6 | $ 11.2 | |
Depreciation expense and amortization | 1.7 | $ 1.7 | |
Long-term accrued compensation | $ 23.4 | $ 23.3 |
Balance Sheet Components - Accr
Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Accrued compensation | $ 18,721 | $ 20,192 |
Accrued third-party cloud infrastructure expenses | 2,459 | 2,752 |
Accrued reseller commissions | 6,973 | 7,731 |
Accrued advertising and marketing expenses | 4,557 | 4,465 |
Advanced payments from customers | 3,928 | 3,480 |
Accrued taxes | 6,372 | 7,730 |
Operating lease liabilities, current | 7,266 | 6,775 |
Contributions withheld for employee stock purchase plan | 3,836 | 1,546 |
Other accrued expenses | 4,215 | 4,337 |
Accrued liabilities | $ 58,327 | $ 59,008 |
Leases - Narrative (Details)
Leases - Narrative (Details) | Mar. 31, 2023 |
Lessee, Lease, Description [Line Items] | |
Operating lease, option to extend, term | 6 years |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Operating lease, term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Operating lease, term | 8 years |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases [Abstract] | ||
Operating lease cost | $ 2,494 | $ 1,775 |
Short-term lease cost | 174 | 315 |
Variable lease cost | $ 785 | $ 669 |
Leases - Summary of Lease Term
Leases - Summary of Lease Term and Discount Rate (Details) | Mar. 31, 2023 | Mar. 31, 2022 |
Leases [Abstract] | ||
Weighted-average remaining lease term (in years) | 4 years 7 months 6 days | 5 years 7 months 6 days |
Weighted-average discount rate | 7.80% | 7.70% |
Leases - Summary of Supplementa
Leases - Summary of Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases [Abstract] | ||
Cash payments included in the measurement of operating lease liabilities | $ 2,326 | $ 2,724 |
Operating lease right-of-use assets obtained in exchange for operating lease obligations | $ 0 | $ 5,324 |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Operating Lease Liabilities (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Leases [Abstract] | |
Remainder of 2023 | $ 6,907 |
2024 | 9,761 |
2025 | 8,795 |
2026 | 5,533 |
2027 | 4,235 |
Thereafter | 5,800 |
Total lease payments | 41,032 |
Less: imputed interest | (7,583) |
Present value of operating lease liabilities | $ 33,449 |
Commitment and Contingencies (D
Commitment and Contingencies (Details) $ in Millions | Mar. 31, 2023 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual commitments | $ 93 |
Stockholders' Equity and Stoc_3
Stockholders' Equity and Stock Based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Sep. 30, 2021 USD ($) tranche target $ / shares shares | May 31, 2019 shares | Mar. 31, 2023 USD ($) purchasePeriod shares | Mar. 31, 2022 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment arrangement, expensed and capitalized, amount | $ 51,208 | $ 46,625 | ||
Stock-based compensation, net of amounts capitalized | $ 50,694 | 46,625 | ||
ESPP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Purchase price of common stock in percent | 85% | |||
Offering period | 24 months | |||
Number of purchase periods | purchasePeriod | 4 | |||
Purchase period | 6 months | |||
ESPP offering period | 24 months | |||
Share-based payment arrangement, expensed and capitalized, amount | $ 2,000 | 3,200 | ||
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Contractual term | 10 years | |||
Award vesting period | 4 years | |||
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 4 years | |||
Total grant date fair value | $ 39,000 | 106,600 | ||
Granted (in shares) | shares | 1,540,000 | |||
Performance Based Restricted Stock Units (PRSUs) | Chief Executive Officer | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total grant date fair value | $ 131,000 | |||
Granted (in shares) | shares | 6,000,000 | 166,390 | ||
Number of threshold stock price targets | target | 5 | |||
Number of threshold vesting tranches | tranche | 5 | |||
Trading day period | 60 days | |||
Stock-based compensation, net of amounts capitalized | $ 6,900 | $ 6,900 | ||
Performance Based Restricted Stock Units (PRSUs) | Chief Executive Officer | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Threshold stock price target (in USD per share) | $ / shares | $ 70 | |||
Performance Based Restricted Stock Units (PRSUs) | Chief Executive Officer | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Threshold stock price target (in USD per share) | $ / shares | $ 200 |
Stockholders' Equity and Stoc_4
Stockholders' Equity and Stock Based Compensation - Shares of Common Stock Reserved for Future Issuance (Details) shares in Thousands | Mar. 31, 2023 shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total shares of common stock reserved for issuance (in shares) | 117,876 |
ESPP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total shares of common stock reserved for issuance (in shares) | 11,181 |
2011 Stock Plan: | Share-Based Payment Arrangements | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total shares of common stock reserved for issuance (in shares) | 19,180 |
2021 Equity Incentive Plan: | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total shares of common stock reserved for issuance (in shares) | 66,768 |
2021 Equity Incentive Plan: | Share-Based Payment Arrangements | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total shares of common stock reserved for issuance (in shares) | 10,747 |
2022 Inducement Plan: | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total shares of common stock reserved for issuance (in shares) | 6,491 |
2022 Inducement Plan: | Share-Based Payment Arrangements | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total shares of common stock reserved for issuance (in shares) | 3,509 |
Stockholders' Equity and Stoc_5
Stockholders' Equity and Stock Based Compensation - Summary of Stock Options (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Number of Shares (in thousands) | |||
Beginning balance (in shares) | 2,758 | ||
Stock options exercised (in shares) | (19) | ||
Stock options cancelled / forfeited / expired (in shares) | (3) | ||
Ending balance (in shares) | 2,736 | ||
Options vested or expected to vest (in shares) | 2,736 | ||
Options exercisable (in shares) | 920 | ||
Weighted-Average Exercise Price | |||
Beginning balance (in USD per share) | $ 9.06 | ||
Stock options exercised (in USD per share) | 0.31 | ||
Stock options cancelled / forfeited / expired (in USD per share) | 0.16 | ||
Ending balance (in USD per share) | 9.12 | ||
Options vested or expected to vest (in USD per share) | 9.12 | ||
Options exercisable (in USD per share) | $ 0.27 | ||
Weighted-Average Remaining Contractual Term (in years) | |||
Weighted-Average Remaining Contractual Term (in years) | 7 years 1 month 6 days | 7 years 3 months 18 days | |
Options vested or expected to vest as of the end of the period | 7 years 1 month 6 days | ||
Options exercisable as of the end of the period | 2 years 4 months 24 days | ||
Aggregate Intrinsic Value | |||
Aggregate intrinsic value | $ 17,062 | $ 15,595 | |
Options vested or expected to vest as of the end of the period | 17,062 | ||
Options exercisable as of the end of the period | $ 13,884 |
Stockholders' Equity and Stoc_6
Stockholders' Equity and Stock Based Compensation - Schedule of Restricted Stock Unit Activity (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Weighted-Average Grant Date Fair Value Per Share | |
Stock withheld for tax withholding requirements (in shares) | 800,000 |
Restricted Stock Units | |
Number of Shares | |
Unvested, beginning balance (in shares) | 32,253,000 |
Granted (in shares) | 1,540,000 |
Vested (in shares) | (2,261,000) |
Forfeited (in shares) | (832,000) |
Unvested, ending balance (in shares) | 30,700,000 |
Weighted-Average Grant Date Fair Value Per Share | |
Unvested, beginning balance (in USD per share) | $ / shares | $ 18.86 |
Granted (in USD per share) | $ / shares | 14.54 |
Vested (in USD per share) | $ / shares | 17.23 |
Forfeited (in USD per share) | $ / shares | 17.39 |
Unvested, ending balance (in USD per share) | $ / shares | $ 18.80 |
Stockholders' Equity and Stoc_7
Stockholders' Equity and Stock Based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation, net of amounts capitalized | $ 50,694 | $ 46,625 |
Capitalized stock-based compensation | 514 | 0 |
Total stock-based compensation expense | 51,208 | 46,625 |
Cost of revenue | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation, net of amounts capitalized | 1,696 | 1,526 |
Research and development | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation, net of amounts capitalized | 8,979 | 8,309 |
Sales and marketing | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation, net of amounts capitalized | 15,756 | 12,536 |
Sales and marketing | President | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation, net of amounts capitalized | 2,400 | |
General and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation, net of amounts capitalized | 24,263 | 24,254 |
General and administrative | RSUs and PRSUs | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock-based compensation, net of amounts capitalized | $ 13,800 | $ 13,800 |
Stockholders' Equity and Stoc_8
Stockholders' Equity and Stock Based Compensation - Schedule of Unrecognized Stock-Based Compensation (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation expense, including options | $ 12,834 |
Total unrecognized stock-based compensation expense | 514,051 |
RSUs and PRSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation expense, excluding options | $ 491,190 |
Weighted-Average Period to Recognize Expense (in years) | 2 years 10 months 24 days |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted-Average Period to Recognize Expense (in years) | 3 years 4 months 24 days |
ESPP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation expense, excluding options | $ 10,027 |
Weighted-Average Period to Recognize Expense (in years) | 1 year |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator: | ||
Net loss | $ (42,664) | $ (49,059) |
Denominator: | ||
Weighted-average shares used in computing net loss per share - basic (in shares) | 290,133 | 278,186 |
Weighted-average shares used in computing net loss per share - diluted (in shares) | 290,133 | 278,186 |
Net loss per share attributable to Class A and Class B common stockholders - diluted (in dollars per share) | $ (0.15) | $ (0.18) |
Net loss per share attributable to Class A and Class B common stockholders - basic (in dollars per share) | $ (0.15) | $ (0.18) |
Net Loss Per Share - Potential
Net Loss Per Share - Potential Common Equivalents Excluded from Computation of Diluted Net Loss per Share (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 33,730 | 33,883 |
RSUs and PRSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 30,700 | 32,238 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 2,736 | 1,236 |
ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 294 | 409 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Provision for income taxes | $ 4,036 | $ 2,537 |
Geographic Information - Schedu
Geographic Information - Schedule of Revenue and Long-lived Assets by Geographic Location (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | $ 137,692 | $ 114,637 | |
Total long-lived assets | 55,389 | $ 57,163 | |
North America | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | 61,067 | 48,773 | |
Total long-lived assets | 24,329 | 23,839 | |
Europe, Middle East and Africa | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | 52,866 | 45,505 | |
Total long-lived assets | 3,584 | 4,039 | |
Asia Pacific | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | 20,025 | 17,479 | |
Total long-lived assets | 27,476 | $ 29,285 | |
Other | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Revenue | $ 3,734 | $ 2,880 |
Geographic Information - Additi
Geographic Information - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | $ 137,692 | $ 114,637 |
UNITED STATES | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | $ 53,900 | $ 42,800 |
UNITED STATES | Revenue from Contract with Customer Benchmark | Geographic Concentration Risk | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Concentration risk percentage | 39% | 37% |
UNITED KINGDOM | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Revenue | $ 17,100 | $ 14,900 |
UNITED KINGDOM | Revenue from Contract with Customer Benchmark | Geographic Concentration Risk | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Concentration risk percentage | 12% | 13% |