Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2024 | Jul. 31, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-37496 | |
Entity Registrant Name | RAPID7, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 35-2423994 | |
Entity Address, Address Line One | 120 Causeway Street | |
Entity Address, City or Town | Boston, | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02114 | |
City Area Code | 617 | |
Local Phone Number | 247-1717 | |
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Trading Symbol | RPD | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 62,734,157 | |
Entity Central Index Key | 0001560327 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 236,975 | $ 213,629 |
Short-term investments | 205,671 | 169,544 |
Accounts receivable, net of allowance for credit losses of $1,380 and $951 at June 30, 2024 and December 31, 2023, respectively | 143,671 | 164,862 |
Deferred contract acquisition and fulfillment costs, current portion | 48,880 | 45,008 |
Prepaid expenses and other current assets | 39,194 | 41,407 |
Total current assets | 674,391 | 634,450 |
Long-term investments | 51,434 | 56,171 |
Property and equipment, net | 34,884 | 39,642 |
Operating lease right-of-use assets | 50,645 | 54,693 |
Deferred contract acquisition and fulfillment costs, non-current portion | 74,693 | 76,601 |
Goodwill | 536,351 | 536,351 |
Intangible assets, net | 84,019 | 94,546 |
Other assets | 20,176 | 12,894 |
Total assets | 1,526,593 | 1,505,348 |
Current liabilities: | ||
Accounts payable | 12,820 | 15,812 |
Accrued expenses and other current liabilities | 67,242 | 85,025 |
Convertible senior notes, current portion, net | 45,737 | 0 |
Operating lease liabilities, current portion | 15,592 | 13,452 |
Deferred revenue, current portion | 437,222 | 455,503 |
Total current liabilities | 578,613 | 569,792 |
Convertible senior notes non-current portion, net | 886,272 | 929,996 |
Operating lease liabilities, non-current portion | 73,425 | 81,130 |
Deferred revenue, non-current portion | 27,512 | 32,577 |
Other long-term liabilities | 13,691 | 10,032 |
Total liabilities | 1,579,513 | 1,623,527 |
Stockholders’ deficit: | ||
Preferred stock, $0.01 par value per share; 100,000,000 shares authorized at June 30, 2024 and December 31, 2023; 0 shares issued and outstanding at June 30, 2024 and December 31, 2023 | 0 | 0 |
Common stock, $0.01 par value per share; 100,000,000 shares authorized at June 30, 2024 and December 31, 2023; $63,271,273 and 62,283,630 shares issued at June 30, 2024 and December 31, 2023, respectively; $62,701,694 and $61,714,051 shares outstanding at June 30, 2024 and December 31, 2023, respectively | 627 | 617 |
Treasury stock, at cost, 569,579 shares at June 30, 2024 and December 31, 2023 | (4,765) | (4,765) |
Additional paid-in-capital | 951,621 | 894,630 |
Accumulated other comprehensive (loss) income | (851) | 1,344 |
Accumulated deficit | (999,552) | (1,010,005) |
Total stockholders’ deficit | (52,920) | (118,179) |
Total liabilities and stockholders’ deficit | $ 1,526,593 | $ 1,505,348 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 1,380 | $ 951 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 63,271,273 | 62,283,630 |
Common stock, shares outstanding (in shares) | 62,701,694 | 61,714,051 |
Treasury stock, at cost (in shares) | 569,579 | 569,579 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Revenue: | ||||
Total revenue | $ 207,991 | $ 190,422 | $ 413,092 | $ 373,596 |
Cost of revenue: | ||||
Total cost of revenue | 60,848 | 58,164 | 121,751 | 114,163 |
Total gross profit | 147,143 | 132,258 | 291,341 | 259,433 |
Operating expenses: | ||||
Research and development | 40,056 | 50,762 | 81,046 | 97,108 |
Sales and marketing | 77,795 | 83,036 | 150,600 | 163,623 |
General and administrative | 22,412 | 22,888 | 42,247 | 47,095 |
Impairment of long-lived assets | 0 | 27,231 | 0 | 27,231 |
Total operating expenses | 140,263 | 183,917 | 273,893 | 335,057 |
Income (loss) from operations | 6,880 | (51,659) | 17,448 | (75,624) |
Other income (expense), net: | ||||
Interest income | 5,221 | 1,787 | 9,941 | 3,455 |
Interest expense | (2,673) | (2,773) | (5,343) | (5,490) |
Other expense, net | (695) | (13,268) | (2,130) | (13,575) |
Income (loss) before income taxes | 8,733 | (65,913) | 19,916 | (91,234) |
Provision for income taxes | 538 | 869 | 9,463 | 1,463 |
Net income (loss) | $ 8,195 | $ (66,782) | $ 10,453 | $ (92,697) |
Net income (loss) per share, basic (in dollars per share) | $ 0.13 | $ (1.10) | $ 0.17 | $ (1.54) |
Net income (loss) per share, diluted (in dollars per share) | $ 0.11 | $ (1.10) | $ 0.14 | $ (1.54) |
Weighted-average common shares outstanding, basic (in Shares) | 62,496,289 | 60,470,396 | 62,201,182 | 60,180,954 |
Weighted-average common shares outstanding, diluted (in Shares) | 74,250,360 | 60,470,396 | 74,135,121 | 60,180,954 |
Product subscriptions | ||||
Revenue: | ||||
Total revenue | $ 200,067 | $ 181,701 | $ 396,985 | $ 355,473 |
Cost of revenue: | ||||
Total cost of revenue | 54,982 | 51,148 | 109,637 | 99,336 |
Professional services | ||||
Revenue: | ||||
Total revenue | 7,924 | 8,721 | 16,107 | 18,123 |
Cost of revenue: | ||||
Total cost of revenue | $ 5,866 | $ 7,016 | $ 12,114 | $ 14,827 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 8,195 | $ (66,782) | $ 10,453 | $ (92,697) |
Other comprehensive income (loss): | ||||
Change in fair value of cash flow hedges | (329) | 447 | (958) | 639 |
Adjustment for net (gains)/losses realized on cash flow hedges and included in net income (loss), net of taxes | (92) | (61) | (473) | 580 |
Total change in unrealized (losses) gains on cash flow hedges | (421) | 386 | (1,431) | 1,219 |
Change in unrealized (losses) gains on investments | (209) | 64 | (764) | 442 |
Total other comprehensive (loss) income | (630) | 450 | (2,195) | 1,661 |
Comprehensive income (loss) | $ 7,565 | $ (66,332) | $ 8,258 | $ (91,036) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Deficit (Unaudited) - USD ($) $ in Thousands | Total | Common stock | Treasury stock | Additional paid-in-capital | Accumulated other comprehensive income (loss) | Accumulated deficit |
Common stock, beginning balance (in shares) at Dec. 31, 2022 | 59,720,000 | |||||
Beginning balance at Dec. 31, 2022 | $ (120,074) | $ 597 | $ (4,764) | $ 746,249 | $ (1,411) | $ (860,745) |
Treasury stock, beginning balance (in shares) at Dec. 31, 2022 | 487,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation expense | 60,794 | 60,794 | ||||
Issuance of common stock under employee stock purchase plan (in shares) | 178,000 | |||||
Issuance of common stock under employee stock purchase plan | 6,174 | $ 2 | 6,172 | |||
Vesting of restricted stock units (in shares) | 801,000 | |||||
Vesting of restricted stock units | 0 | $ 7 | (7) | |||
Shares withheld for employee taxes (in shares) | (53,000) | |||||
Shares withheld for employee taxes | (2,591) | (2,591) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 187,000 | |||||
Issuance of common stock upon exercise of stock options | 2,682 | $ 2 | 2,680 | |||
Issuance of common stock related to acquisition (in shares) | 107,000 | |||||
Issuance of common stock related to acquisition | 0 | $ 1 | (1) | |||
Repurchase of common stock issued in relation to acquisition (in shares) | 83,000 | |||||
Repurchase of common stock issued in relation to acquisition | 0 | $ (1) | 1 | |||
Reclassification of equity to derivative assets related to capped calls | 33,029 | 33,029 | ||||
Other comprehensive gain (loss) | 1,661 | 1,661 | ||||
Net income (loss) | (92,697) | (92,697) | ||||
Common stock, ending balance (in shares) at Jun. 30, 2023 | 60,940,000 | |||||
Treasury stock, ending balance (in shares) at Jun. 30, 2023 | 570,000 | |||||
Ending balance at Jun. 30, 2023 | (111,022) | $ 609 | $ (4,765) | 846,326 | 250 | (953,442) |
Common stock, beginning balance (in shares) at Mar. 31, 2023 | 60,322,000 | |||||
Beginning balance at Mar. 31, 2023 | (110,172) | $ 603 | $ (4,765) | 780,850 | (200) | (886,660) |
Treasury stock, beginning balance (in shares) at Mar. 31, 2023 | 570,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation expense | 31,276 | 31,276 | ||||
Vesting of restricted stock units (in shares) | 442,000 | |||||
Vesting of restricted stock units | 0 | $ 4 | (4) | |||
Shares withheld for employee taxes (in shares) | (28,000) | |||||
Shares withheld for employee taxes | (1,324) | (1,324) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 171,000 | |||||
Issuance of common stock upon exercise of stock options | 2,501 | $ 2 | 2,499 | |||
Issuance of common stock related to acquisition (in shares) | 33,000 | |||||
Issuance of common stock related to acquisition | 0 | |||||
Reclassification of equity to derivative assets related to capped calls | 33,029 | 33,029 | ||||
Other comprehensive gain (loss) | 450 | 450 | ||||
Net income (loss) | (66,782) | (66,782) | ||||
Common stock, ending balance (in shares) at Jun. 30, 2023 | 60,940,000 | |||||
Treasury stock, ending balance (in shares) at Jun. 30, 2023 | 570,000 | |||||
Ending balance at Jun. 30, 2023 | $ (111,022) | $ 609 | $ (4,765) | 846,326 | 250 | (953,442) |
Common stock, beginning balance (in shares) at Dec. 31, 2023 | 61,714,051 | 61,714,000 | ||||
Beginning balance at Dec. 31, 2023 | $ (118,179) | $ 617 | $ (4,765) | 894,630 | 1,344 | (1,010,005) |
Treasury stock, beginning balance (in shares) at Dec. 31, 2023 | 569,579 | 570,000 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation expense | $ 53,642 | 53,642 | ||||
Issuance of common stock under employee stock purchase plan (in shares) | 148,000 | |||||
Issuance of common stock under employee stock purchase plan | 5,046 | $ 2 | 5,044 | |||
Vesting of restricted stock units (in shares) | 782,000 | |||||
Vesting of restricted stock units | 0 | $ 8 | (8) | |||
Shares withheld for employee taxes (in shares) | (62,000) | |||||
Shares withheld for employee taxes | (3,090) | (3,090) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 120,000 | |||||
Issuance of common stock upon exercise of stock options | 1,403 | $ 1 | 1,402 | |||
Other comprehensive gain (loss) | (2,195) | (2,195) | ||||
Net income (loss) | $ 10,453 | 10,453 | ||||
Common stock, ending balance (in shares) at Jun. 30, 2024 | 62,701,694 | 62,702,000 | ||||
Treasury stock, ending balance (in shares) at Jun. 30, 2024 | 569,579 | 570,000 | ||||
Ending balance at Jun. 30, 2024 | $ (52,920) | $ 628 | $ (4,765) | 951,620 | (851) | (999,552) |
Common stock, beginning balance (in shares) at Mar. 31, 2024 | 62,269,000 | |||||
Beginning balance at Mar. 31, 2024 | (86,449) | $ 623 | $ (4,765) | 925,661 | (221) | (1,007,747) |
Treasury stock, beginning balance (in shares) at Mar. 31, 2024 | 570,000 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Stock-based compensation expense | 27,155 | 27,155 | ||||
Vesting of restricted stock units (in shares) | 457,000 | |||||
Vesting of restricted stock units | 0 | $ 5 | (5) | |||
Shares withheld for employee taxes (in shares) | (33,000) | |||||
Shares withheld for employee taxes | (1,326) | (1,326) | ||||
Issuance of common stock upon exercise of stock options (in shares) | 9,000 | |||||
Issuance of common stock upon exercise of stock options | 135 | 135 | ||||
Other comprehensive gain (loss) | (630) | (630) | ||||
Net income (loss) | $ 8,195 | 8,195 | ||||
Common stock, ending balance (in shares) at Jun. 30, 2024 | 62,701,694 | 62,702,000 | ||||
Treasury stock, ending balance (in shares) at Jun. 30, 2024 | 569,579 | 570,000 | ||||
Ending balance at Jun. 30, 2024 | $ (52,920) | $ 628 | $ (4,765) | $ 951,620 | $ (851) | $ (999,552) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 10,453 | $ (92,697) |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 22,219 | 22,879 |
Amortization of debt issuance costs | 2,108 | 2,020 |
Stock-based compensation expense | 52,302 | 61,068 |
Impairment of long-lived assets | 0 | 27,231 |
Change in fair value of derivative assets | 0 | 12,660 |
Deferred income taxes | 1,840 | 0 |
Other | (1,352) | 4,423 |
Changes in assets and liabilities: | ||
Accounts receivable | 19,990 | 15,110 |
Deferred contract acquisition and fulfillment costs | (1,964) | (5,963) |
Prepaid expenses and other assets | 430 | 1,400 |
Accounts payable | (3,021) | (1,282) |
Accrued expenses | (18,391) | (11,968) |
Deferred revenue | (23,346) | 1,783 |
Other liabilities | 2,660 | 483 |
Net cash provided by operating activities | 63,928 | 37,147 |
Cash flows from investing activities: | ||
Business acquisitions, net of cash acquired | 0 | (34,841) |
Purchases of property and equipment | (900) | (3,704) |
Capitalization of internal-use software | (6,289) | (9,081) |
Purchases of investments | (157,967) | (80,257) |
Sales and maturities of investments | 130,001 | 65,700 |
Other investing activities | 360 | 0 |
Net cash used in investing activities | (34,795) | (62,183) |
Cash flows from financing activities: | ||
Payments related to business acquisitions | 0 | (2,250) |
Taxes paid related to net share settlement of equity awards | (3,089) | (2,591) |
Proceeds from employee stock purchase plan | 5,046 | 6,174 |
Proceeds from stock option exercises | 1,404 | 2,682 |
Net cash provided by financing activities | 3,361 | 4,015 |
Effect of exchange rate changes on cash ,cash equivalents and restricted cash | (2,076) | (337) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 30,418 | (21,358) |
Cash, cash equivalents and restricted cash, beginning of period | 214,130 | 207,804 |
Cash, cash equivalents and restricted cash, end of period | 244,548 | 186,446 |
Supplemental cash flow information: | ||
Cash paid for interest on convertible senior notes | 3,215 | 3,337 |
Cash paid for income taxes, net of refunds | 5,505 | 1,221 |
Reconciliation of cash, cash equivalents and restricted cash: | ||
Cash and cash equivalents | 236,975 | 185,929 |
Restricted cash included in other assets and prepaid expenses and other current assets | 7,573 | 517 |
Total cash, cash equivalents and restricted cash | $ 244,548 | $ 186,446 |
Description of Business, Basis
Description of Business, Basis of Presentation and Consolidation and Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Description of Business, Basis of Presentation and Consolidation and Significant Accounting Policies | Note 1. Description of Business, Basis of Presentation and Consolidation and Significant Accounting Policies Description of Business Rapid7, Inc. and subsidiaries (“we,” “us” or “our”) are advancing security with visibility, analytics, and automation delivered through our platform solutions. Our solutions simplify the complex, allowing security teams to work more effectively with IT and development to reduce vulnerabilities, monitor for malicious behavior, investigate and shut down attacks, and automate routine tasks. Basis of Presentation and Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared by us in accordance with accounting principles generally accepted in the United States of America (“GAAP”), as well as pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), regarding interim financial reporting. Accordingly, certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 26, 2024. The consolidated financial statements include our results of operations and those of our wholly-owned subsidiaries and reflect all adjustments (consisting solely of normal, recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods presented. All intercompany transactions and balances have been eliminated in consolidation. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The management estimates include, but are not limited to the determination of standalone selling prices in revenue transactions with multiple performance obligations, the estimated period of benefit for deferred contract acquisition costs, the useful lives and recoverability of long-lived assets, the valuation for credit losses, the valuation of stock-based compensation, the fair value of assets acquired and liabilities assumed in business combinations, the incremental borrowing rate for operating leases and the valuation for deferred tax assets. We base our estimates on historical experience and on various other assumptions that we believe are reasonable. Actual results could differ from those estimates. Significant Accounting Policies Our significant accounting policies are described in Note 2, Summary of Significant Accounting Policies , to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. Restricted Cash As of June 30, 2024, we had $7.6 million of restricted cash recorded on our condensed consolidated balance sheet in prepaid expenses and other current assets and other assets in letters of credit outstanding as collateral for certain office space leases. Recent Accounting Pronouncements |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Note 2. Revenue from Contracts with Customers We generate revenue primarily from: (1) product subscriptions from the sale of cloud-based subscriptions, managed services, term software licenses, content subscriptions and maintenance and support associated with our software licenses and (2) professional services from the sale of our deployment and training services related to our solutions, incident response services, penetration testing and security advisory services. Product Subscriptions Product subscriptions consists primarily of revenue from our cloud-based subscription, managed services offerings, term software licenses, content subscriptions and maintenance and support associated with our software licenses. • We generate cloud-based subscription revenue primarily from sales of subscriptions to access our cloud platform, together with related support services to our customers. These arrangements do not provide the customer with the right to take possession of our software operating on our cloud platform at any time. Instead, customers are granted continuous access to our cloud platform over the contractual period. Revenue is recognized over time on a ratable basis over the contract term beginning on the date that our service is made available to the customer. Our cloud-based subscription contracts generally have annual or multi-year contractual terms which are billed in advance of the annual subscription period and are non-cancellable. • Managed services offerings consist of fees generated when we operate our software and provide our capabilities on behalf of our customers. Revenue is recognized on a ratable basis over the contract term beginning on the date that our service is made available to the customer. Our managed services offerings generally have annual or multi-year contractual terms which are billed in advance of the annual subscription period and are non-cancellable. • For our term software licenses where the utility to the customer is dependent on the continued delivery of content subscriptions, we recognize the license revenue over the contractual term of the content subscription. • Content subscriptions and our maintenance and support services are sold with our term software licenses. Revenue related to our content subscriptions associated with our software licenses is recognized ratably over the contractual period. Professional Services All of our professional services are considered distinct performance obligations when sold stand alone or with other products. The majority of our professional services contracts have terms of one year or less. For the majority of these contracts, revenue is recognized over time based upon the proportion of work performed to date. Contract Balances Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period consistent with the above methodology. For the three months ended June 30, 2024 and 2023, we recognized revenue of $179.0 million and $164.9 million, respectively, and for the six months ended June 30, 2024 and 2023, we recognized $310.8 million and $288.3 million, respectively, that was included in the corresponding contract liability balance at the beginning of the periods presented. Deferred revenue that will be realized during the succeeding 12-month period is recorded as current, and the remaining deferred revenue is recorded as non-current. We receive payments from customers based upon contractual billing schedules. Accounts receivable are recorded when the right to consideration becomes unconditional. Unbilled receivables include amounts related to our contractual right to consideration for both completed and partially completed performance obligations that have not been invoiced. If the right to consideration is based on satisfaction of another performance obligation in the contract other than the passage of time, we record a contract asset. As of June 30, 2024 and December 31, 2023, unbilled receivables of $2.4 million and $1.1 million, respectively, are included in prepaid expenses and other current assets in our consolidated balance sheet. As of June 30, 2024 and December 31, 2023, we had no contract assets recorded on our condensed consolidated balance sheet. Transaction Price Allocated to the Remaining Performance Obligations The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially unsatisfied as of June 30, 2024. The estimated revenues do not include unexercised contract renewals. Next Twelve Months Thereafter (in thousands) Product subscriptions $ 560,247 $ 272,911 Professional services 16,155 6,999 Total $ 576,402 $ 279,910 Note 8. Deferred Contract Acquisitions and Fulfillment Costs The following table summarizes the activity of the deferred contract acquisition and fulfillment costs for the six months ended June 30, 2024 and 2023: Six Months Ended June 30, 2024 2023 (in thousands) Beginning balance $ 121,609 $ 103,075 Capitalization of contract acquisition and fulfillment costs 27,466 25,480 Amortization of deferred contract acquisition and fulfillment costs (25,502) (19,517) Ending balance $ 123,573 $ 109,038 |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Business Combinations | Note 3. Business Combinations Minerva Labs Ltd. On March 14, 2023, we acquired Minerva Labs Ltd. (“Minerva”), a leading provider of anti-evasion and ransomware prevention technology, for a purchase price with an aggregate fair value of $34.6 million. The purchase consideration consisted of $35 million paid in cash at closing and a $(0.4) million receivable for purchase price adjustments. The assets acquired and liabilities assumed were recorded at their estimated fair values as of the acquisition date. The excess of the purchase price over the assets acquired and liabilities assumed was recorded as goodwill. The fair value of net assets acquired, goodwill and intangible assets were $13.9 million, $20.7 million and $12.8 million, respectively. The goodwill was allocated to our one reporting unit. The acquired goodwill and intangible assets were not deductible for tax purposes. In the first quarter of 2024, we sold acquired intellectual property through a non-cash intercompany transaction, which for the three and six months ended June 30, 2024 resulted in $4.6 million of current tax expense and $1.8 million of deferred tax expense in Israel. |
Investments
Investments | 6 Months Ended |
Jun. 30, 2024 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Note 4. Investments Our investments, which are all classified as available-for-sale, consisted of the following: As of June 30, 2024 Amortized Gross Gross Fair Value (in thousands) Description: U.S government agencies $ 257,475 $ 3 $ (373) $ 257,105 Total $ 257,475 $ 3 $ (373) $ 257,105 As of December 31, 2023 Amortized Gross Gross Fair Value (in thousands) Description: U.S government agencies $ 222,820 $ 467 $ (65) $ 223,222 Agency bonds 2,500 — (7) 2,493 Total $ 225,320 $ 467 $ (72) $ 225,715 As of June 30, 2024, our available-for-sale investments had maturities ranging fro m 1 to 15 months. As of December 31, 2023, our available-for-sale investments had maturities ranging from 1 to 18 months. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 5. Fair Value Measurements We measure certain financial assets and liabilities at fair value. Fair value is determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as determined by either the principal market or the most advantageous market. Inputs used in the valuation techniques to derive fair values are classified based on a three-level hierarchy, as follows: • Level 1 : Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2 : Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which all significant inputs are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3 : Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the asset or liability. We consider an active market to be one in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis, and consider an inactive market to be one in which there are infrequent or few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. The following table presents our financial assets and liabilities measured and recorded at fair value on a recurring basis using the above input categories: As of June 30, 2024 Level 1 Level 2 Level 3 Total (in thousands) Description: Assets: U.S. government agencies $ 257,105 $ — $ — $ 257,105 Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) — 1,662 — 1,662 Total assets $ 257,105 $ 1,662 $ — $ 258,767 Liabilities: Foreign currency forward contracts designated as cash flow hedges (other current liabilities) — 419 — 419 Total liabilities $ — $ 419 $ — $ 419 As of December 31, 2023 Level 1 Level 2 Level 3 Total (in thousands) Description: Assets: U.S. government agencies $ 223,222 $ — $ — $ 223,222 Agency bonds — 2,493 — 2,493 Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) — 1,322 — 1,322 Total assets $ 223,222 $ 3,815 $ — $ 227,037 Liabilities: Foreign currency forward contracts designated as cash flow hedges (other current liabilities) — 55 — 55 Total liabilities $ — $ 55 $ — $ 55 Cash and cash equivalents are excluded from the table above as carrying amounts reported in our condensed consolidated balance sheet equal or approximate fair value. As of June 30, 2024, the fair value of our 2.25%, 0.25% and 1.25% convertible senior notes due 2025, 2027 and 2029, as further described in Note 10, Debt , was $45.1 million, $536.2 million and $282.9 million, respectively, based upon quoted market prices. We consider the fair value of the Notes (as defined in Note 10, Debt) to be a Level 2 measurement due to limited trading activity of the Notes. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 6. Property and Equipment Property and equipment are recorded at cost and consist of the following: June 30, December 31, 2024 2023 (in thousands) Computer equipment and software $ 27,355 $ 26,442 Furniture and fixtures 10,823 10,850 Leasehold improvements 56,151 56,151 Total 94,328 93,443 Less accumulated depreciation (59,444) (53,801) Property and equipment, net $ 34,884 $ 39,642 |
Goodwill and Intangibles
Goodwill and Intangibles | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles | Note 7. Goodwill and Intangibles Goodwill was $536.4 million as of June 30, 2024 and December 31, 2023. The following table presents details of our intangible assets which include acquired identifiable intangible assets and capitalized internal-use software costs: Weighted- As of June 30, 2024 As of December 31, 2023 Gross Carrying Accumulated Net Book Value Gross Carrying Accumulated Net Book Value (in thousands) Intangible assets subject to amortization: Developed technology 5.4 $ 135,355 $ (85,360) $ 49,995 $ 135,355 $ (77,031) $ 58,324 Customer relationships 4.5 12,000 (9,059) 2,941 12,000 (7,755) 4,245 Trade names 3.1 2,619 (2,469) 150 2,619 (2,379) 240 Total acquired intangible assets 149,974 (96,887) 53,087 149,974 (87,164) 62,810 Internal-use software 3.0 61,380 (30,448) 30,933 55,371 (23,635) 31,736 Total intangible assets $ 211,354 $ (127,335) $ 84,019 $ 205,345 $ (110,799) $ 94,546 Amortization expense was $8.1 million and $8.1 million for the three months ended June 30, 2024 and 2023, respectively, and $16.5 million and $15.3 million for the six months ended June 30, 2024 and 2023, respectively. Estimated future amortization expense of the acquired identifiable intangible assets and completed capitalized internal-use software costs as of June 30, 2024 was as follows (in thousands): 2024 (for the remaining six months) $ 19,373 2025 28,630 2026 18,799 2027 7,163 2028 1,600 2029 and thereafter 3,531 Total $ 79,096 The table above excludes the impact of $4.9 million of capitalized internal-use software costs for projects that have not been completed as of June 30, 2024, and therefore, all the costs associated with these projects have not been incurred. |
Deferred Contract Acquisition a
Deferred Contract Acquisition and Fulfillment Costs | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Deferred Contract Acquisition and Fulfillment Costs | Note 2. Revenue from Contracts with Customers We generate revenue primarily from: (1) product subscriptions from the sale of cloud-based subscriptions, managed services, term software licenses, content subscriptions and maintenance and support associated with our software licenses and (2) professional services from the sale of our deployment and training services related to our solutions, incident response services, penetration testing and security advisory services. Product Subscriptions Product subscriptions consists primarily of revenue from our cloud-based subscription, managed services offerings, term software licenses, content subscriptions and maintenance and support associated with our software licenses. • We generate cloud-based subscription revenue primarily from sales of subscriptions to access our cloud platform, together with related support services to our customers. These arrangements do not provide the customer with the right to take possession of our software operating on our cloud platform at any time. Instead, customers are granted continuous access to our cloud platform over the contractual period. Revenue is recognized over time on a ratable basis over the contract term beginning on the date that our service is made available to the customer. Our cloud-based subscription contracts generally have annual or multi-year contractual terms which are billed in advance of the annual subscription period and are non-cancellable. • Managed services offerings consist of fees generated when we operate our software and provide our capabilities on behalf of our customers. Revenue is recognized on a ratable basis over the contract term beginning on the date that our service is made available to the customer. Our managed services offerings generally have annual or multi-year contractual terms which are billed in advance of the annual subscription period and are non-cancellable. • For our term software licenses where the utility to the customer is dependent on the continued delivery of content subscriptions, we recognize the license revenue over the contractual term of the content subscription. • Content subscriptions and our maintenance and support services are sold with our term software licenses. Revenue related to our content subscriptions associated with our software licenses is recognized ratably over the contractual period. Professional Services All of our professional services are considered distinct performance obligations when sold stand alone or with other products. The majority of our professional services contracts have terms of one year or less. For the majority of these contracts, revenue is recognized over time based upon the proportion of work performed to date. Contract Balances Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period consistent with the above methodology. For the three months ended June 30, 2024 and 2023, we recognized revenue of $179.0 million and $164.9 million, respectively, and for the six months ended June 30, 2024 and 2023, we recognized $310.8 million and $288.3 million, respectively, that was included in the corresponding contract liability balance at the beginning of the periods presented. Deferred revenue that will be realized during the succeeding 12-month period is recorded as current, and the remaining deferred revenue is recorded as non-current. We receive payments from customers based upon contractual billing schedules. Accounts receivable are recorded when the right to consideration becomes unconditional. Unbilled receivables include amounts related to our contractual right to consideration for both completed and partially completed performance obligations that have not been invoiced. If the right to consideration is based on satisfaction of another performance obligation in the contract other than the passage of time, we record a contract asset. As of June 30, 2024 and December 31, 2023, unbilled receivables of $2.4 million and $1.1 million, respectively, are included in prepaid expenses and other current assets in our consolidated balance sheet. As of June 30, 2024 and December 31, 2023, we had no contract assets recorded on our condensed consolidated balance sheet. Transaction Price Allocated to the Remaining Performance Obligations The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially unsatisfied as of June 30, 2024. The estimated revenues do not include unexercised contract renewals. Next Twelve Months Thereafter (in thousands) Product subscriptions $ 560,247 $ 272,911 Professional services 16,155 6,999 Total $ 576,402 $ 279,910 Note 8. Deferred Contract Acquisitions and Fulfillment Costs The following table summarizes the activity of the deferred contract acquisition and fulfillment costs for the six months ended June 30, 2024 and 2023: Six Months Ended June 30, 2024 2023 (in thousands) Beginning balance $ 121,609 $ 103,075 Capitalization of contract acquisition and fulfillment costs 27,466 25,480 Amortization of deferred contract acquisition and fulfillment costs (25,502) (19,517) Ending balance $ 123,573 $ 109,038 |
Derivative and Hedging Activiti
Derivative and Hedging Activities | 6 Months Ended |
Jun. 30, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging Activities | Note 9. Derivative and Hedging Activities To mitigate our exposure to foreign currency fluctuations resulting from certain expenses denominated in certain foreign currencies, we enter into forward contracts that are designated as cash flow hedging instruments. These forward contracts have contractual maturities of eighteen months or less, and as of June 30, 2024 and December 31, 2023, outstanding forward contracts had a total notional value of $42.7 million and $44.9 million, respectively. The notional value represents the gross amount of foreign currency that will be bought or sold upon maturity of the forward contract. During the three and six months ended June 30, 2024, all cash flow hedges were considered effective. Refer to Note 5, Fair Value Measurements , for the fair values of our outstanding derivative instruments. |
Debt
Debt | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Debt | Note 10. Debt Convertible Senior Notes In May 2020, we issued $230.0 million aggregate principal amount of convertible senior notes due May 1, 2025 (the “2025 Notes”), in March 2021, we issued $600.0 million aggregate principal amount of convertible senior notes due March 15, 2027 (the “2027 Notes”), and in September 2023, we issued $300.0 million aggregate principal amount of convertible senior notes due March 15, 2029 (the “2029 Notes”) (collectively, the “Notes”). In September 2023, we used $201.0 million of the proceeds from the issuance of the 2029 Notes to repurchase and retire $184.0 million aggregate principal amount of the 2025 Notes and paid accrued and unpaid interest thereon. Further details of the Notes are as follows: Issuance Maturity Date Interest Rate First Interest Payment Date Effective Interest Rate Semi-Annual Interest Payment Dates Initial Conversion Rate per $1,000 Principal Initial Conversion Price Number of Shares (in millions) 2025 Notes May 1, 2025 2.25% November 1, 2020 2.88% May 1 and November 1 16.3875 $ 61.02 0.8 2027 Notes March 15, 2027 0.25% September 15, 2021 0.67% March 15 and September 15 9.6734 $ 103.38 5.8 2029 Notes March 15, 2029 1.25% March 15, 2024 1.69% March 15 and September 15 15.4213 $ 64.85 4.6 The 2025 Notes, the 2027 Notes and the 2029 Notes are senior unsecured obligations, do not contain any financial covenants and are governed by indentures between the Company, as issuer, and U.S. Trust Company, Bank National Association, as trustee (the “Indentures”). The total net proceeds from the 2025 Notes, the 2027 Notes and the 2029 Notes offerings, after deducting initial purchase discounts and debt issuance costs, were $222.8 million, $585.0 million and $292.0 million, respectively. For additional details on the terms of our Notes, see Note 11, Debt , to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. As of June 30, 2024, the 2025 Notes, the 2027 Notes and the 2029 Notes were not convertible at the option of the holders. The holders may convert the 2025 Notes, the 2027 Notes and the 2029 Notes at any time on or after November 1, 2024, December 15, 2026 and December 15, 2028, respectively, until the close of business on the second scheduled trading day immediately preceding the maturity date, regardless of the circumstances set forth above. Upon conversion, we will pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, in the manner and subject to the terms and conditions provided in the Indentures. If we undergo a fundamental change (as set forth in the Indentures) at any time prior to the maturity date, holders of the Notes will have the right, at their option, to require us to repurchase for cash all or any portion of their Notes at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. In addition, following certain corporate events that occur prior to the maturity date or following our issuance of a notice of redemption, in each case as described in the Indentures, we will increase the conversion rate for a holder of the Notes who elects to convert its Notes in connection with such a corporate event or during the related redemption period in certain circumstances. Accounting for the Notes In accounting for the issuance of the Notes, the principal less debt issuance costs are recorded as debt on our condensed consolidated balance sheet. The debt issuance costs are amortized to interest expense using the effective interest method over the contractual term of the Notes. The net carrying amount of the Notes as of June 30, 2024 and December 31, 2023 was as follows (in thousands): 2025 Notes 2027 Notes 2029 Notes Principal Unamortized debt issuance costs Total Principal Unamortized debt issuance costs Total Principal Unamortized debt issuance costs Total Balance at December 31, 2023 $ 45,992 $ (404) $ 45,588 $ 600,000 $ (8,077) $ 591,923 $ 300,000 $ (7,515) $ 292,485 Amortization of debt issuance costs — 148 148 — 1,244 1,244 — 621 621 Balance at June 30, 2024 $ 45,992 $ (256) $ 45,736 $ 600,000 $ (6,833) $ 593,167 $ 300,000 $ (6,894) $ 293,106 Interest expense related to the Notes was as follows (in thousands): Three Months Ended June 30, 2024 2023 2025 Notes 2027 Notes 2029 Notes Total 2025 Notes 2027 Notes Total Contractual interest expense $ 259 $ 375 $ 937 $ 1,571 $ 1,294 $ 375 $ 1,669 Amortization of debt issuance costs 73 624 311 1,008 361 619 980 Total interest expense $ 332 $ 999 $ 1,248 $ 2,579 $ 1,655 $ 994 $ 2,649 Six Months Ended June 30, 2024 2023 2025 Notes 2027 Notes 2029 Notes Total 2025 Notes 2027 Notes Total Contractual interest expense $ 518 $ 750 $ 1,874 $ 3,142 $ 2,588 $ 750 $ 3,338 Amortization of debt issuance costs 148 1,244 621 2,013 701 1,224 1,925 Total interest expense $ 666 $ 1,994 $ 2,495 $ 5,155 $ 3,289 $ 1,974 $ 5,263 Capped Calls In connection with the offering of the 2025 Notes, the 2027 Notes and the 2029 Notes, we entered into privately negotiated capped call transactions with certain counterparties (the “2025 Capped Calls”, “2027 Capped Calls” and “2029 Capped Calls”) (collectively, the “Capped Calls”). The Capped Calls are expected to reduce potential dilution to our common stock upon conversion of a given series of notes and/or offset any cash payments that we are required to make in excess of the principal amount of converted notes of such series, as the case may be, with such reduction and/or offset subject to a cap. The Capped Calls are subject to adjustment upon the occurrence of certain specified extraordinary events affecting us, including merger events, tender offers and announcement events. In addition, the Capped Calls are subject to certain specified additional disruption events that may give rise to a termination of the Capped Calls, including nationalization, insolvency or delisting, changes in law, failures to deliver, insolvency filings and hedging disruptions. The following table sets forth other key terms and premiums paid for the Capped Calls related to each series of Notes: Capped Calls Entered into in Connection with the Issuance of the 2025 Notes Capped Calls Entered into in Connection with the Issuance of the 2027 Notes Capped Calls Entered into in Connection with the Issuance of the 2029 Notes Initial strike price, subject to certain adjustments $ 61.02 $ 103.38 $ 64.85 Cap price, subject to certain adjustments $ 93.88 $ 159.04 $ 97.88 Total premium paid (in thousands) $ 27,255 $ 76,020 $ 36,570 Expiration dates March 4, 2025 - April 29, 2025 January 1, 2027 - March 11, 2027 February 13, 2029 - March 13, 2029 For accounting purposes, the 2025 Capped Calls, the 2027 Capped Calls and the 2029 Capped Calls are separate transactions, and not part of the terms of the 2025 Notes, the 2027 Notes and the 2029 Notes. The 2025 Capped Calls, 2027 Capped Calls and 2029 Capped Calls are recorded in stockholders' equity and are not accounted for as derivatives. Credit Agreement In April 2020, we entered into a Credit and Security Agreement (the Credit Agreement), with KeyBank National Association (as amended, in December 2021) that provides for a $100.0 million revolving credit facility, with a letter of credit sublimit of $15.0 million and an accordion feature under which we can increase the credit facility to up to $150.0 million. We incurred fees of $0.4 million in connection with entering into the Credit Agreement. The fees are recorded in other current assets on the condensed consolidated balance sheet and are amortized on a straight-line basis over the contractual term of the arrangement. The commitment fee of 0.2% per annum on the unused portion of the credit facility is expensed as incurred and included within interest expense on the condensed consolidated statement of operations. The Credit Agreement contains certain financial covenants including a requirement that we maintain specified minimum recurring revenue and liquidity amounts. The borrowings under the Credit Agreement bear interest, at our option, at a rate equal to either (i) term SOFR plus a credit spread adjustment of 0.10% per annum plus a margin of 2.50% per annum or (ii) the alternate base rate (subject to a floor), plus an applicable margin equal to 0% per annum. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Note 11. Stock-Based Compensation ( a) General Stock-based compensation expense for restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), stock options and purchase rights issued under our employee stock purchase plan was classified in the accompanying condensed consolidated statements of operations as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (in thousands) Stock-based compensation expense: Cost of revenue 3,126 2,984 5,706 5,821 Research and development 8,597 11,634 16,163 22,139 Sales and marketing 7,512 8,138 14,359 15,981 General and administrative 8,174 8,939 16,074 17,127 Total stock-based compensation expense $ 27,409 $ 31,695 $ 52,302 $ 61,068 We recognize compensation cost of all awards on a straight-line basis over the applicable vesting period, which is generally three Our Compensation Committee adopted and approved the performance goals, targets and payout formulas for our 2024 and 2023 bonus plans, including permitting our executive officers and certain other employees the opportunity to receive payment of their earned bonuses in the form of common stock (in lieu of cash). During each of the three months ended June 30, 2024 and 2023, we recognized stock-based compensation expense related to such bonuses in the amount of $0.4 million, and during the six months ended June 30, 2024 and 2023, we recognized stock-based compensation expense in the amount of $0.5 million a nd $1.1 million, respectively, based on the probable expected performance against the pre-established corporate financial objectives as of June 30, 2024 and 2023. For employees, including executive officers, who elect to receive their bonuses in the form of common stock (in lieu of cash), the payouts are expected to be made in the form of fully vested stock awards in the first quarter of the following year pursuant to our 2015 Equity Incentive Plan, as amended. The number of shares underlying such awards is determined by dividing the dollar value of the actual bonus award payment by the closing price per share of our common stock on the date of grant. (b) Restricted Stock, Restricted Stock Units and Performance-Based Restricted Stock Units RSUs and PSUs activity during the six months ended June 30, 2024 was as follows: Shares Weighted- Unvested balance as of December 31, 2023 2,714,426 $ 63.02 Granted 2,101,535 $ 53.97 Vested (781,389) $ 60.68 Forfeited (389,590) $ 61.04 Unvested balance as of June 30, 2024 3,644,982 $ 58.42 As of June 30, 2024, the unrecognized compensation expense related to our unvested RSUs and PSUs was $188.9 million. This unrecognized compensation expense will be recognized over an estimated weighted-average amortization period of 2.2 years. In January 2024, our Com pensation Committee awarded 279,570 PSUs that required the achievement of net annualized recurring revenue (“Net ARR”) and Adjusted EBITDA targets for the 2024 full-year to earn any payout. Net ARR is defined as the change in the annual value of all recurring revenue related to contracts in place at year end. In addition, the portion of the PSUs that are earned would be capped at a maximum of 200% of the target level payout and if certain net ARR or Adjusted EBITDA goals were not met, no PSUs will be earned. The PSUs have a performance period of one year and the earned PSUs will vest in three equal installments following each of the first, second and third anniversary of the vesting commencement date, subject to the participant’s continuous service as of each such date. In the three and six months ended June 30, 2024, we recorded $0.9 million and $1.8 million, respectively, of stock-based compensation expense related to these PSUs based on estimated achievement of the performance criteria. (c) Stock Options Stock option activity during the six months ended June 30, 2024 was as follows: Shares Weighted Weighted Aggregate Outstanding as of December 31, 2023 716,270 $ 12.26 1.97 $ 32,115 Granted — — Exercised (120,322) $ 11.66 $ 4,667 Forfeited/cancelled (450) $ 7.73 Outstanding as of June 30, 2024 595,498 $ 12.39 1.69 $ 18,367 Vested and exercisable as of June 30, 2024 595,498 $ 12.39 1.69 $ 22,146 (d) Employee Stock Purchase Plan Under the Rapid7, Inc. 2015 Employee Stock Purchase Plan (“ESPP”), employees may set aside up to 15% of their gross earnings, on an after-tax basis, to purchase our common stock at a discounted price, which is calculated at 85% of the lesser of: (i) the market value of our common stock at the beginning of each offering period and (ii) the market value of our common stock on the applicable purchase date. On March 15, 2024, we issued shares of common stock to employees, with a purchase price of either $33.78 or $39.78 per share, for aggregate proceeds of $5.0 million. |
Net Income (Loss) per Share
Net Income (Loss) per Share | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) per Share | Note 12. Net Income (Loss) per Share The following table summarizes the computation of basic and diluted net income (loss) per share of our common stock for the three months June 30, 2024 and 2023: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (in thousands, except share and per share data) Numerator: Net income (loss) $ 8,195 $ (66,782) $ 10,453 $ (92,697) Denominator: Weighted-average common shares outstanding, basic 62,496,289 60,470,396 62,201,182 60,180,954 Weighted-average common shares outstanding, diluted 74,250,360 60,470,396 74,135,121 $ 60,180,954 Net income (loss) per share, basic $ 0.13 $ (1.10) $ 0.17 $ (1.54) Net income (loss) per share, diluted $ 0.11 $ (1.10) $ 0.14 (1.54) We intend to settle any conversion of our 2025 Notes, 2027 Notes and 2029 Notes in cash, shares, or a combination thereof. The dilutive impact of the Notes for our calculation of diluted net income (loss) per share is considered using the if-converted method. For the three and six months ended June 30, 2024 and 2023, the shares underlying the Notes were not considered in the calculation of diluted net income (loss) per share as the effect would have been anti-dilutive. In connection with the issuance of the 2025 Notes, the 2027 Notes and the 2029 Notes, we entered into the 2025 Capped Calls, 2027 Capped Calls and 2029 Capped Calls, which were not included for the purpose of calculating the number of diluted shares outstanding, as their effect would have been anti-dilutive. As of June 30, 2024 and 2023, the 2025 Notes, the 2027 Notes and the 2029 Notes were not convertible at the option of the holder. We had not received any conversion notices through the issuance date of our unaudited condensed consolidated financial statements. For disclosure purposes, we have calculated the potentially dilutive effect of the conversion spread, which is included in the table below. The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted-average shares outstanding for the respective periods below because they would have been anti-dilutive: Three and Six Months Ended June 30, 2024 2023 Options to purchase common stock 595,498 744,262 Unvested restricted stock units 3,644,982 3,838,671 Common stock issued in conjunction to acquisitions 36,923 115,041 Shares to be issued under ESPP 85,855 120,586 Convertible senior notes 11,183,611 9,572,955 Total 15,546,869 14,391,515 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13. Commitments and Contingencies (a) Warranty We provide limited product warranties. Historically, any payments made under these provisions have been immaterial. (b) Litigation and Claims From time to time, we may be a party to litigation or subject to claims incident to the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, we currently believe that the final outcome of these ordinary course matters will not have a material adverse effect on our business. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. (c) Indemnification Obligations We agree to standard indemnification provisions in the ordinary course of business. Pursuant to these provisions, we agree to indemnify, hold harmless and reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally our customers, in connection with any United States patent, copyright or other intellectual property infringement claim by any third party arising from the use of our products or services in accordance with the agreement or arising from our gross negligence, willful misconduct or violation of the law (provided that there is not gross or willful misconduct on the part of the other party) with respect to our products or services. The term of these indemnification provisions is generally perpetual from the time of execution of the agreement. We carry insurance that covers certain third-party claims relating to our services and limits our exposure. We have never incurred costs to defend lawsuits or settle claims related to these indemnification provisions. As permitted under Delaware law, we have entered into indemnification agreements with our officers and directors, indemnifying them for certain events or occurrences while they serve as officers or directors of the company. (d) Income Taxes From time to time, we may receive income tax assessments from taxing authorities asserting additional tax liabilities owed by the Company. During the quarter ended June 30, 2024, we received an initial assessment from the Israel Tax Authority (“ITA”) of approximately 324 million Israeli New Shekels (approximately $87 million, based upon current exchange rates between the Israeli New Shekel and the US Dollar) related to fiscal year 2021. Based on our interpretation of the regulations and available case law, we believe that the tax positions we have taken on our filed tax return in Israel are sustainable and we intend to defend our position through all available means. As such, we have not recorded any impact of the ITA assessment in our condensed consolidated financial statements as of, and for the three and six months ended June 30, 2024. We are continuing to monitor developments related to this matter and its impact on our existing income tax reserves for all open years. If we are unsuccessful in sustaining our tax position in this matter, our financial condition and results of operations would be adversely affected. |
Segment Information and Informa
Segment Information and Information about Geographic Areas | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
Segment Information and Information about Geographic Areas | Note 14. Segment Information and Information about Geographic Areas We operate in one segment. Our chief operating decision maker is our Chief Executive Officer, who makes operating decisions, assesses performance and allocates resources on a consolidated basis. Net revenues by geographic area presented based upon the location of the customer are as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (in thousands) North America $ 159,322 $ 149,683 $ 316,662 $ 293,564 Rest of world 48,669 40,739 96,430 80,032 Total $ 207,991 $ 190,422 $ 413,092 $ 373,596 Property and equipment, net by geographic area was as follows: As of June 30, 2024 As of December 31, 2023 (in thousands) North America $ 24,220 $ 27,609 Rest of world 10,664 12,033 Total $ 34,884 $ 39,642 |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Note 15. Restructuring On August 7, 2023, our board of directors approved a restructuring plan that was designed to improve operational efficiencies, reduce operating costs and better align the Company’s workforce with current business needs, top strategic priorities and key growth opportunities (collectively, the “Restructuring Plan”). The Restructuring Plan included a reduction of the Company’s workforce by approximately 16%. During the first quarter of 2024, the execution of the Restructuring Plan was completed and we recorded $(0.2) million of restructuring charges within general and administrative expense in the condensed consolidated statements of operations. The following table presents the activity of the restructuring liability for the six months ended June 30, 2024: Restructuring Liability (in thousands) Balance at December 31, 2023 $ 3,764 Charges (190) Payments (3,574) Balance at June 30, 2024 $ — |
Subsequent Event
Subsequent Event | 6 Months Ended |
Jun. 30, 2024 | |
Subsequent Events [Abstract] | |
Subsequent Event | Note 16. Subsequent Event |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Pay vs Performance Disclosure | ||||
Net income (loss) | $ 8,195 | $ (66,782) | $ 10,453 | $ (92,697) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 6 Months Ended |
Jun. 30, 2024 shares | Jun. 30, 2024 shares | |
Trading Arrangements, by Individual | ||
Non-Rule 10b5-1 Arrangement Adopted | false | |
Rule 10b5-1 Arrangement Terminated | false | |
Non-Rule 10b5-1 Arrangement Terminated | false | |
Reeny Sondhi [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | During the three months ended June 30, 2024, the executive officers set forth below terminated or modified a 10b5-1 equity trading plan, or adopted, terminated, or modified any “non-Rule 10b5-1 equity trading arrangement”. Name and Position Action Adoption or Transaction Date Type of Trading Arrangement Number of Shares of Common Stock to be Sold Expiration Date Reeny Sondhi Director Adoption May 30, 2024 Rule 10b5-1* 14,650 ** 05/15/2025*** * Contract, instruction or written plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act. ** Represents the maximum number of shares that may be sold pursuant to the Rule 10b5-1 trading arrangement in amounts and prices determined in accordance with a formula set forth in the plan. The actual number of shares sold will be dependent on the satisfaction of certain conditions as set forth in the written plan. *** The Rule 10b5-1 trading arrangement will terminate on the earlier of the date all the shares under the plan are sold and the expiration date indicated, subject to early termination for specified events set forth in the plan. | |
Name | Reeny Sondhi | |
Title | Director | |
Rule 10b5-1 Arrangement Adopted | true | |
Adoption Date | May 30, 2024 | |
Expiration Date | 05/15/2025 | |
Arrangement Duration | 350 days | |
Aggregate Available | 14,650 | 14,650 |
Description of Business, Basi_2
Description of Business, Basis of Presentation and Consolidation and Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared by us in accordance with accounting principles generally accepted in the United States of America (“GAAP”), as well as pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), regarding interim financial reporting. Accordingly, certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 26, 2024. The consolidated financial statements include our results of operations and those of our wholly-owned subsidiaries and reflect all adjustments (consisting solely of normal, recurring adjustments) which are, in the opinion of management, necessary for a fair statement of results for the interim periods presented. All intercompany transactions and balances have been eliminated in consolidation. The results of operations for the three and six months ended June 30, 2024 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. |
Use of Estimates | Use of Estimates |
Restricted Cash | Restricted Cash As of June 30, 2024, we had $7.6 million |
Recent Accounting Pronouncements | Recent Accounting Pronouncements |
Revenue | Product Subscriptions Product subscriptions consists primarily of revenue from our cloud-based subscription, managed services offerings, term software licenses, content subscriptions and maintenance and support associated with our software licenses. • We generate cloud-based subscription revenue primarily from sales of subscriptions to access our cloud platform, together with related support services to our customers. These arrangements do not provide the customer with the right to take possession of our software operating on our cloud platform at any time. Instead, customers are granted continuous access to our cloud platform over the contractual period. Revenue is recognized over time on a ratable basis over the contract term beginning on the date that our service is made available to the customer. Our cloud-based subscription contracts generally have annual or multi-year contractual terms which are billed in advance of the annual subscription period and are non-cancellable. • Managed services offerings consist of fees generated when we operate our software and provide our capabilities on behalf of our customers. Revenue is recognized on a ratable basis over the contract term beginning on the date that our service is made available to the customer. Our managed services offerings generally have annual or multi-year contractual terms which are billed in advance of the annual subscription period and are non-cancellable. • For our term software licenses where the utility to the customer is dependent on the continued delivery of content subscriptions, we recognize the license revenue over the contractual term of the content subscription. • Content subscriptions and our maintenance and support services are sold with our term software licenses. Revenue related to our content subscriptions associated with our software licenses is recognized ratably over the contractual period. Professional Services All of our professional services are considered distinct performance obligations when sold stand alone or with other products. The majority of our professional services contracts have terms of one year or less. For the majority of these contracts, revenue is recognized over time based upon the proportion of work performed to date. Contract Balances Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period consistent with the above methodology. For the three months ended June 30, 2024 and 2023, we recognized revenue of $179.0 million and $164.9 million, respectively, and for the six months ended June 30, 2024 and 2023, we recognized $310.8 million and $288.3 million, respectively, that was included in the corresponding contract liability balance at the beginning of the periods presented. Deferred revenue that will be realized during the succeeding 12-month period is recorded as current, and the remaining deferred revenue is recorded as non-current. We receive payments from customers based upon contractual billing schedules. Accounts receivable are recorded when the right to consideration becomes unconditional. Unbilled receivables include amounts related to our contractual right to consideration for both completed and partially completed performance obligations that have not been invoiced. If the right to consideration is based on satisfaction of another performance obligation in the contract other than the passage of time, we record a contract asset. As of June 30, 2024 and December 31, 2023, unbilled receivables of $2.4 million and $1.1 million, respectively, are included in prepaid expenses and other current assets in our consolidated balance sheet. As of June 30, 2024 and December 31, 2023, we had no contract assets recorded on our condensed consolidated balance sheet. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Estimated Revenue Expected to be Recognized in Future Related to Performance Obligations | The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied or partially unsatisfied as of June 30, 2024. The estimated revenues do not include unexercised contract renewals. Next Twelve Months Thereafter (in thousands) Product subscriptions $ 560,247 $ 272,911 Professional services 16,155 6,999 Total $ 576,402 $ 279,910 |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of Investments Classified as Available-for-sale | Our investments, which are all classified as available-for-sale, consisted of the following: As of June 30, 2024 Amortized Gross Gross Fair Value (in thousands) Description: U.S government agencies $ 257,475 $ 3 $ (373) $ 257,105 Total $ 257,475 $ 3 $ (373) $ 257,105 As of December 31, 2023 Amortized Gross Gross Fair Value (in thousands) Description: U.S government agencies $ 222,820 $ 467 $ (65) $ 223,222 Agency bonds 2,500 — (7) 2,493 Total $ 225,320 $ 467 $ (72) $ 225,715 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Assets and Liabilities Measured and Recorded at Fair Value on Recurring Basis | The following table presents our financial assets and liabilities measured and recorded at fair value on a recurring basis using the above input categories: As of June 30, 2024 Level 1 Level 2 Level 3 Total (in thousands) Description: Assets: U.S. government agencies $ 257,105 $ — $ — $ 257,105 Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) — 1,662 — 1,662 Total assets $ 257,105 $ 1,662 $ — $ 258,767 Liabilities: Foreign currency forward contracts designated as cash flow hedges (other current liabilities) — 419 — 419 Total liabilities $ — $ 419 $ — $ 419 As of December 31, 2023 Level 1 Level 2 Level 3 Total (in thousands) Description: Assets: U.S. government agencies $ 223,222 $ — $ — $ 223,222 Agency bonds — 2,493 — 2,493 Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) — 1,322 — 1,322 Total assets $ 223,222 $ 3,815 $ — $ 227,037 Liabilities: Foreign currency forward contracts designated as cash flow hedges (other current liabilities) — 55 — 55 Total liabilities $ — $ 55 $ — $ 55 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment are recorded at cost and consist of the following: June 30, December 31, 2024 2023 (in thousands) Computer equipment and software $ 27,355 $ 26,442 Furniture and fixtures 10,823 10,850 Leasehold improvements 56,151 56,151 Total 94,328 93,443 Less accumulated depreciation (59,444) (53,801) Property and equipment, net $ 34,884 $ 39,642 |
Goodwill and Intangibles (Table
Goodwill and Intangibles (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Identifiable Intangible Assets | The following table presents details of our intangible assets which include acquired identifiable intangible assets and capitalized internal-use software costs: Weighted- As of June 30, 2024 As of December 31, 2023 Gross Carrying Accumulated Net Book Value Gross Carrying Accumulated Net Book Value (in thousands) Intangible assets subject to amortization: Developed technology 5.4 $ 135,355 $ (85,360) $ 49,995 $ 135,355 $ (77,031) $ 58,324 Customer relationships 4.5 12,000 (9,059) 2,941 12,000 (7,755) 4,245 Trade names 3.1 2,619 (2,469) 150 2,619 (2,379) 240 Total acquired intangible assets 149,974 (96,887) 53,087 149,974 (87,164) 62,810 Internal-use software 3.0 61,380 (30,448) 30,933 55,371 (23,635) 31,736 Total intangible assets $ 211,354 $ (127,335) $ 84,019 $ 205,345 $ (110,799) $ 94,546 |
Summary of Estimated Amortization Expense | Estimated future amortization expense of the acquired identifiable intangible assets and completed capitalized internal-use software costs as of June 30, 2024 was as follows (in thousands): 2024 (for the remaining six months) $ 19,373 2025 28,630 2026 18,799 2027 7,163 2028 1,600 2029 and thereafter 3,531 Total $ 79,096 |
Deferred Contract Acquisition_2
Deferred Contract Acquisition and Fulfillment Costs (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Capitalized Contract Cost | The following table summarizes the activity of the deferred contract acquisition and fulfillment costs for the six months ended June 30, 2024 and 2023: Six Months Ended June 30, 2024 2023 (in thousands) Beginning balance $ 121,609 $ 103,075 Capitalization of contract acquisition and fulfillment costs 27,466 25,480 Amortization of deferred contract acquisition and fulfillment costs (25,502) (19,517) Ending balance $ 123,573 $ 109,038 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Summary of Long-term Debt Instruments | Further details of the Notes are as follows: Issuance Maturity Date Interest Rate First Interest Payment Date Effective Interest Rate Semi-Annual Interest Payment Dates Initial Conversion Rate per $1,000 Principal Initial Conversion Price Number of Shares (in millions) 2025 Notes May 1, 2025 2.25% November 1, 2020 2.88% May 1 and November 1 16.3875 $ 61.02 0.8 2027 Notes March 15, 2027 0.25% September 15, 2021 0.67% March 15 and September 15 9.6734 $ 103.38 5.8 2029 Notes March 15, 2029 1.25% March 15, 2024 1.69% March 15 and September 15 15.4213 $ 64.85 4.6 |
Summary of Liability and Equity Components of Convertible Debt | The net carrying amount of the Notes as of June 30, 2024 and December 31, 2023 was as follows (in thousands): 2025 Notes 2027 Notes 2029 Notes Principal Unamortized debt issuance costs Total Principal Unamortized debt issuance costs Total Principal Unamortized debt issuance costs Total Balance at December 31, 2023 $ 45,992 $ (404) $ 45,588 $ 600,000 $ (8,077) $ 591,923 $ 300,000 $ (7,515) $ 292,485 Amortization of debt issuance costs — 148 148 — 1,244 1,244 — 621 621 Balance at June 30, 2024 $ 45,992 $ (256) $ 45,736 $ 600,000 $ (6,833) $ 593,167 $ 300,000 $ (6,894) $ 293,106 Interest expense related to the Notes was as follows (in thousands): Three Months Ended June 30, 2024 2023 2025 Notes 2027 Notes 2029 Notes Total 2025 Notes 2027 Notes Total Contractual interest expense $ 259 $ 375 $ 937 $ 1,571 $ 1,294 $ 375 $ 1,669 Amortization of debt issuance costs 73 624 311 1,008 361 619 980 Total interest expense $ 332 $ 999 $ 1,248 $ 2,579 $ 1,655 $ 994 $ 2,649 Six Months Ended June 30, 2024 2023 2025 Notes 2027 Notes 2029 Notes Total 2025 Notes 2027 Notes Total Contractual interest expense $ 518 $ 750 $ 1,874 $ 3,142 $ 2,588 $ 750 $ 3,338 Amortization of debt issuance costs 148 1,244 621 2,013 701 1,224 1,925 Total interest expense $ 666 $ 1,994 $ 2,495 $ 5,155 $ 3,289 $ 1,974 $ 5,263 |
Summary of Other Key Terms and Premiums Paid for the Capped Calls Related to Each Series of Notes | The following table sets forth other key terms and premiums paid for the Capped Calls related to each series of Notes: Capped Calls Entered into in Connection with the Issuance of the 2025 Notes Capped Calls Entered into in Connection with the Issuance of the 2027 Notes Capped Calls Entered into in Connection with the Issuance of the 2029 Notes Initial strike price, subject to certain adjustments $ 61.02 $ 103.38 $ 64.85 Cap price, subject to certain adjustments $ 93.88 $ 159.04 $ 97.88 Total premium paid (in thousands) $ 27,255 $ 76,020 $ 36,570 Expiration dates March 4, 2025 - April 29, 2025 January 1, 2027 - March 11, 2027 February 13, 2029 - March 13, 2029 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Stock-Based Compensation Expense | Stock-based compensation expense for restricted stock units (“RSUs”), performance-based restricted stock units (“PSUs”), stock options and purchase rights issued under our employee stock purchase plan was classified in the accompanying condensed consolidated statements of operations as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (in thousands) Stock-based compensation expense: Cost of revenue 3,126 2,984 5,706 5,821 Research and development 8,597 11,634 16,163 22,139 Sales and marketing 7,512 8,138 14,359 15,981 General and administrative 8,174 8,939 16,074 17,127 Total stock-based compensation expense $ 27,409 $ 31,695 $ 52,302 $ 61,068 |
Summary of Restricted Stock and Restricted Stock Unit Activity | RSUs and PSUs activity during the six months ended June 30, 2024 was as follows: Shares Weighted- Unvested balance as of December 31, 2023 2,714,426 $ 63.02 Granted 2,101,535 $ 53.97 Vested (781,389) $ 60.68 Forfeited (389,590) $ 61.04 Unvested balance as of June 30, 2024 3,644,982 $ 58.42 |
Summary of Stock Option Activity | Stock option activity during the six months ended June 30, 2024 was as follows: Shares Weighted Weighted Aggregate Outstanding as of December 31, 2023 716,270 $ 12.26 1.97 $ 32,115 Granted — — Exercised (120,322) $ 11.66 $ 4,667 Forfeited/cancelled (450) $ 7.73 Outstanding as of June 30, 2024 595,498 $ 12.39 1.69 $ 18,367 Vested and exercisable as of June 30, 2024 595,498 $ 12.39 1.69 $ 22,146 |
Net Income (Loss) per Share (Ta
Net Income (Loss) per Share (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Net Income (Loss) Per Share of Common Stock | The following table summarizes the computation of basic and diluted net income (loss) per share of our common stock for the three months June 30, 2024 and 2023: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (in thousands, except share and per share data) Numerator: Net income (loss) $ 8,195 $ (66,782) $ 10,453 $ (92,697) Denominator: Weighted-average common shares outstanding, basic 62,496,289 60,470,396 62,201,182 60,180,954 Weighted-average common shares outstanding, diluted 74,250,360 60,470,396 74,135,121 $ 60,180,954 Net income (loss) per share, basic $ 0.13 $ (1.10) $ 0.17 $ (1.54) Net income (loss) per share, diluted $ 0.11 $ (1.10) $ 0.14 (1.54) |
Summary of Anti-Dilutive Securities Excluded from Computation Diluted Weighted Average Shares Outstanding | The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted-average shares outstanding for the respective periods below because they would have been anti-dilutive: Three and Six Months Ended June 30, 2024 2023 Options to purchase common stock 595,498 744,262 Unvested restricted stock units 3,644,982 3,838,671 Common stock issued in conjunction to acquisitions 36,923 115,041 Shares to be issued under ESPP 85,855 120,586 Convertible senior notes 11,183,611 9,572,955 Total 15,546,869 14,391,515 |
Segment Information and Infor_2
Segment Information and Information about Geographic Areas (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
Summary of Net Revenues of Customer by Geographic Area | Net revenues by geographic area presented based upon the location of the customer are as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 (in thousands) North America $ 159,322 $ 149,683 $ 316,662 $ 293,564 Rest of world 48,669 40,739 96,430 80,032 Total $ 207,991 $ 190,422 $ 413,092 $ 373,596 |
Summary of Property and Equipment, Net by Geographic Area | Property and equipment, net by geographic area was as follows: As of June 30, 2024 As of December 31, 2023 (in thousands) North America $ 24,220 $ 27,609 Rest of world 10,664 12,033 Total $ 34,884 $ 39,642 |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Liability | The following table presents the activity of the restructuring liability for the six months ended June 30, 2024: Restructuring Liability (in thousands) Balance at December 31, 2023 $ 3,764 Charges (190) Payments (3,574) Balance at June 30, 2024 $ — |
Description of Business, Basi_3
Description of Business, Basis of Presentation and Consolidation and Significant Accounting Policies (Details) $ in Millions | Jun. 30, 2024 USD ($) |
Accounting Policies [Abstract] | |
Restricted cash | $ 7.6 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Disaggregation of Revenue [Line Items] | |||||
Liability, revenue recognized | $ 179,000,000 | $ 164,900,000 | $ 310,800,000 | $ 288,300,000 | |
Unbilled receivables | 2,400,000 | 2,400,000 | $ 1,100,000 | ||
Contract assets | $ 0 | $ 0 | $ 0 | ||
Professional Service | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue from contract with customer, contractual period | 1 year |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Summary of Estimated Revenue Expected to be Recognized in Future Related to Performance Obligations (Details) $ in Thousands | Jun. 30, 2024 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total | $ 576,402 |
Revenue recognition period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total | $ 279,910 |
Revenue recognition period | |
Product subscriptions | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total | $ 560,247 |
Revenue recognition period | 12 months |
Product subscriptions | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total | $ 272,911 |
Revenue recognition period | |
Professional services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total | $ 16,155 |
Revenue recognition period | 12 months |
Professional services | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total | $ 6,999 |
Revenue recognition period |
Business Combinations (Details)
Business Combinations (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 14, 2023 USD ($) reportingUnit | Jun. 30, 2024 USD ($) | Jun. 30, 2024 USD ($) | Dec. 31, 2023 USD ($) | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 536,351 | $ 536,351 | $ 536,351 | |
Minerva labs | ||||
Business Acquisition [Line Items] | ||||
Total consideration transferred | $ 34,600 | |||
Purchase consideration | 35,000 | |||
Receivable for purchase price adjustments | (400) | |||
Net assets acquired | 13,900 | |||
Goodwill | 20,700 | |||
Intangible assets | $ 12,800 | |||
Number of reporting units | reportingUnit | 1 | |||
Minerva labs | ISRAEL | ||||
Business Acquisition [Line Items] | ||||
Current foreign tax expense (benefit) | 4,600 | 4,600 | ||
Deferred foreign income tax expense (benefit) | $ 1,800 | $ 1,800 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Dec. 31, 2023 | |
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | $ 257,475 | $ 225,320 |
Gross Unrealized Gains | 3 | 467 |
Gross Unrealized Losses | (373) | (72) |
Fair Value | $ 257,105 | $ 225,715 |
Minimum | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Remaining maturity | 1 month | 1 month |
Maximum | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Remaining maturity | 15 months | 18 months |
U.S government agencies | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | $ 257,475 | $ 222,820 |
Gross Unrealized Gains | 3 | 467 |
Gross Unrealized Losses | (373) | (65) |
Fair Value | $ 257,105 | 223,222 |
Agency bonds | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Amortized Cost | 2,500 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (7) | |
Fair Value | $ 2,493 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Financial Assets and Liabilities Measured and Recorded at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Assets: | ||
Debt securities | $ 257,105 | $ 225,715 |
The Notes, Due 2025 | Convertible Debt | ||
Liabilities: | ||
Interest Rate | 2.25% | |
Convertible debt, fair value disclosures | $ 45,100 | |
The Notes, Due 2027 | Convertible Debt | ||
Liabilities: | ||
Interest Rate | 0.25% | |
Convertible debt, fair value disclosures | $ 536,200 | |
The Notes, Due 2029 | Convertible Debt | ||
Liabilities: | ||
Interest Rate | 1.25% | |
Convertible debt, fair value disclosures | $ 282,900 | |
U.S government agencies | ||
Assets: | ||
Debt securities | 257,105 | 223,222 |
Agency bonds | ||
Assets: | ||
Debt securities | 2,493 | |
Fair Value, Measurements, Recurring | ||
Assets: | ||
Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) | 1,662 | 1,322 |
Total assets | 258,767 | 227,037 |
Liabilities: | ||
Foreign currency forward contracts designated as cash flow hedges (other current liabilities) | 419 | 55 |
Total liabilities | 419 | 55 |
Fair Value, Measurements, Recurring | U.S government agencies | ||
Assets: | ||
Debt securities | 257,105 | 223,222 |
Fair Value, Measurements, Recurring | Agency bonds | ||
Assets: | ||
Debt securities | 2,493 | |
Fair Value, Measurements, Recurring | Level 1 | ||
Assets: | ||
Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) | 0 | 0 |
Total assets | 257,105 | 223,222 |
Liabilities: | ||
Foreign currency forward contracts designated as cash flow hedges (other current liabilities) | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value, Measurements, Recurring | Level 1 | U.S government agencies | ||
Assets: | ||
Debt securities | 257,105 | 223,222 |
Fair Value, Measurements, Recurring | Level 1 | Agency bonds | ||
Assets: | ||
Debt securities | 0 | |
Fair Value, Measurements, Recurring | Level 2 | ||
Assets: | ||
Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) | 1,662 | 1,322 |
Total assets | 1,662 | 3,815 |
Liabilities: | ||
Foreign currency forward contracts designated as cash flow hedges (other current liabilities) | 419 | 55 |
Total liabilities | 419 | 55 |
Fair Value, Measurements, Recurring | Level 2 | U.S government agencies | ||
Assets: | ||
Debt securities | 0 | 0 |
Fair Value, Measurements, Recurring | Level 2 | Agency bonds | ||
Assets: | ||
Debt securities | 2,493 | |
Fair Value, Measurements, Recurring | Level 3 | ||
Assets: | ||
Foreign currency forward contracts designated as cash flow hedges (prepaid expenses and other current assets and other assets) | 0 | 0 |
Total assets | 0 | 0 |
Liabilities: | ||
Foreign currency forward contracts designated as cash flow hedges (other current liabilities) | 0 | 0 |
Total liabilities | 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | U.S government agencies | ||
Assets: | ||
Debt securities | $ 0 | 0 |
Fair Value, Measurements, Recurring | Level 3 | Agency bonds | ||
Assets: | ||
Debt securities | $ 0 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 94,328 | $ 93,443 |
Less accumulated depreciation | (59,444) | (53,801) |
Property and equipment, net | 34,884 | 39,642 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 27,355 | 26,442 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 10,823 | 10,850 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 56,151 | $ 56,151 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 2.8 | $ 3.7 | $ 5.7 | $ 7.6 |
Goodwill and Intangibles - Addi
Goodwill and Intangibles - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Goodwill | $ 536,351 | $ 536,351 | $ 536,351 | ||
Amortization expense | 8,100 | $ 8,100 | 16,500 | $ 15,300 | |
Capitalized computer software exclude of gross | $ 4,900 | $ 4,900 |
Goodwill and Intangibles - Sche
Goodwill and Intangibles - Schedule of Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Dec. 31, 2023 | |
Finite-Lived Intangible Assets [Line Items] | ||
Total acquired intangible assets, gross carrying amount | $ 149,974 | $ 149,974 |
Total acquired intangible assets, accumulated amortization | (96,887) | (87,164) |
Total acquired intangible assets, net book value | 53,087 | 62,810 |
Accumulated Amortization | (127,335) | (110,799) |
Total intangible assets, gross carrying amount | 211,354 | 205,345 |
Intangible assets, net book value | $ 84,019 | 94,546 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted- Average Estimated Useful Life (years) | 5 years 4 months 24 days | |
Total acquired intangible assets, gross carrying amount | $ 135,355 | 135,355 |
Total acquired intangible assets, accumulated amortization | (85,360) | (77,031) |
Total acquired intangible assets, net book value | $ 49,995 | 58,324 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted- Average Estimated Useful Life (years) | 4 years 6 months | |
Total acquired intangible assets, gross carrying amount | $ 12,000 | 12,000 |
Total acquired intangible assets, accumulated amortization | (9,059) | (7,755) |
Total acquired intangible assets, net book value | $ 2,941 | 4,245 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted- Average Estimated Useful Life (years) | 3 years 1 month 6 days | |
Total acquired intangible assets, gross carrying amount | $ 2,619 | 2,619 |
Total acquired intangible assets, accumulated amortization | (2,469) | (2,379) |
Total acquired intangible assets, net book value | $ 150 | 240 |
Internal-use software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted- Average Estimated Useful Life (years) | 3 years | |
Gross Carrying Amount | $ 61,380 | 55,371 |
Accumulated Amortization | (30,448) | (23,635) |
Net Book Value | $ 30,933 | $ 31,736 |
Goodwill and Intangibles - Sc_2
Goodwill and Intangibles - Schedule of Estimated Amortization Expense (Details $ in Thousands | Jun. 30, 2024 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2024 (for the remaining six months) | $ 19,373 |
2025 | 28,630 |
2026 | 18,799 |
2027 | 7,163 |
2028 | 1,600 |
2029 and thereafter | 3,531 |
Total | $ 79,096 |
Deferred Contract Acquisition_3
Deferred Contract Acquisition and Fulfillment Costs (Details) - Contract Acquisition And Fulfillment Costs - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Capitalized Contract Costs [Roll Forward] | ||
Beginning balance | $ 121,609 | $ 103,075 |
Capitalization of contract acquisition and fulfillment costs | 27,466 | 25,480 |
Amortization of deferred contract acquisition and fulfillment costs | (25,502) | (19,517) |
Ending balance | $ 123,573 | $ 109,038 |
Derivative and Hedging Activi_2
Derivative and Hedging Activities (Details) - Foreign currency forward contracts designated as cash flow hedges - Designated as Hedging Instrument - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Dec. 31, 2023 | |
Derivative [Line Items] | ||
Term of contract | 18 months | 18 months |
Notional amount | $ 42.7 | $ 44.9 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | 1 Months Ended | 6 Months Ended | |||||
Dec. 21, 2021 | Sep. 30, 2023 | Dec. 31, 2021 | Mar. 31, 2021 | May 31, 2020 | Jun. 30, 2024 | Apr. 30, 2020 | |
Convertible Debt | Debt Covenant Three | |||||||
Debt Instrument [Line Items] | |||||||
Redemption price, percentage | 100% | ||||||
2025 Notes | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 230,000,000 | ||||||
Converted amount | $ 201,000,000 | ||||||
Repurchased face amount | 184,000,000 | ||||||
Proceeds from convertible debt | $ 222,800,000 | ||||||
2027 Notes | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 600,000,000 | ||||||
Proceeds from convertible debt | $ 585,000,000 | ||||||
2029 Notes | Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | 300,000,000 | ||||||
Proceeds from convertible debt | $ 292,000,000 | ||||||
Credit Agreement | Secured Overnight Financing Rate (SOFR) | |||||||
Debt Instrument [Line Items] | |||||||
Sofr spread rate | 0.10% | ||||||
Basis spread on variable rate | 2.50% | ||||||
Credit Agreement | Base Rate | |||||||
Debt Instrument [Line Items] | |||||||
Basis spread on variable rate | 0% | ||||||
Credit Agreement | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Current borrowing capacity | $ 100,000,000 | ||||||
Credit sublimit | 15,000,000 | ||||||
Fee amount | $ 400,000 | ||||||
Commitment fee percentage | 0.20% | ||||||
Credit Agreement | Letter of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 150,000,000 |
Debt - Summary of Long-term Deb
Debt - Summary of Long-term Debt Instruments (Details) - Convertible Debt shares in Millions | 6 Months Ended |
Jun. 30, 2024 shares $ / shares | |
2025 Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 2.25% |
Effective Interest Rate | 2.88% |
Initial Conversion Rate per $1,000 Principal | 0.0163875 |
Initial Conversion Price (in dollars per share) | $ / shares | $ 61.02 |
Number of shares (in shares) | shares | 0.8 |
2027 Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 0.25% |
Effective Interest Rate | 0.67% |
Initial Conversion Rate per $1,000 Principal | 0.0096734 |
Initial Conversion Price (in dollars per share) | $ / shares | $ 103.38 |
Number of shares (in shares) | shares | 5.8 |
2029 Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 1.25% |
Effective Interest Rate | 1.69% |
Initial Conversion Rate per $1,000 Principal | 0.0154213 |
Initial Conversion Price (in dollars per share) | $ / shares | $ 64.85 |
Number of shares (in shares) | shares | 4.6 |
Debt - Summary of Liability and
Debt - Summary of Liability and Equity Components of Convertible Debt (Details) - Convertible Debt - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Debt Instrument [Line Items] | |||||
Amortization of debt issuance costs | $ 1,008 | $ 980 | $ 2,013 | $ 1,925 | |
2025 Notes | |||||
Debt Instrument [Line Items] | |||||
Principal | 45,992 | 45,992 | $ 45,992 | ||
Unamortized debt issuance costs | (256) | (256) | (404) | ||
Total | 45,736 | 45,736 | 45,588 | ||
Amortization of debt issuance costs | 73 | 361 | 148 | 701 | |
2027 Notes | |||||
Debt Instrument [Line Items] | |||||
Principal | 600,000 | 600,000 | 600,000 | ||
Unamortized debt issuance costs | (6,833) | (6,833) | (8,077) | ||
Total | 593,167 | 593,167 | 591,923 | ||
Amortization of debt issuance costs | 624 | $ 619 | 1,244 | $ 1,224 | |
2029 Notes | |||||
Debt Instrument [Line Items] | |||||
Principal | 300,000 | 300,000 | 300,000 | ||
Unamortized debt issuance costs | (6,894) | (6,894) | (7,515) | ||
Total | 293,106 | 293,106 | $ 292,485 | ||
Amortization of debt issuance costs | $ 311 | $ 621 |
Debt - Summary of Interest Expe
Debt - Summary of Interest Expense (Details) - Convertible Debt - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Debt Instrument [Line Items] | ||||
Contractual interest expense | $ 1,571 | $ 1,669 | $ 3,142 | $ 3,338 |
Amortization of debt issuance costs | 1,008 | 980 | 2,013 | 1,925 |
Total interest expense | 2,579 | 2,649 | 5,155 | 5,263 |
2025 Notes | ||||
Debt Instrument [Line Items] | ||||
Contractual interest expense | 259 | 1,294 | 518 | 2,588 |
Amortization of debt issuance costs | 73 | 361 | 148 | 701 |
Total interest expense | 332 | 1,655 | 666 | 3,289 |
2027 Notes | ||||
Debt Instrument [Line Items] | ||||
Contractual interest expense | 375 | 375 | 750 | 750 |
Amortization of debt issuance costs | 624 | 619 | 1,244 | 1,224 |
Total interest expense | 999 | $ 994 | 1,994 | $ 1,974 |
2029 Notes | ||||
Debt Instrument [Line Items] | ||||
Contractual interest expense | 937 | 1,874 | ||
Amortization of debt issuance costs | 311 | 621 | ||
Total interest expense | $ 1,248 | $ 2,495 |
Debt - Summary of Other Key Ter
Debt - Summary of Other Key Terms and Premiums Paid for the Capped Calls (Details) - Call Option $ / shares in Units, $ in Thousands | 6 Months Ended |
Jun. 30, 2024 USD ($) $ / shares | |
Capped Calls Entered into in Connection with the Issuance of the 2025 Notes | |
Debt Instrument [Line Items] | |
Initial strike price, subject to certain adjustments (in dollars per share) | $ 61.02 |
Cap price, subject to certain adjustments (in dollars per share) | $ 93.88 |
Total premium paid (in thousands) | $ | $ 27,255 |
Capped Calls Entered into in Connection with the Issuance of the 2027 Notes | |
Debt Instrument [Line Items] | |
Initial strike price, subject to certain adjustments (in dollars per share) | $ 103.38 |
Cap price, subject to certain adjustments (in dollars per share) | $ 159.04 |
Total premium paid (in thousands) | $ | $ 76,020 |
Capped Calls Entered into in Connection with the Issuance of the 2029 Notes | |
Debt Instrument [Line Items] | |
Initial strike price, subject to certain adjustments (in dollars per share) | $ 64.85 |
Cap price, subject to certain adjustments (in dollars per share) | $ 97.88 |
Total premium paid (in thousands) | $ | $ 36,570 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment arrangement, expense | $ 27,409 | $ 31,695 | $ 52,302 | $ 61,068 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment arrangement, expense | 3,126 | 2,984 | 5,706 | 5,821 |
Research and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment arrangement, expense | 8,597 | 11,634 | 16,163 | 22,139 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment arrangement, expense | 7,512 | 8,138 | 14,359 | 15,981 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based payment arrangement, expense | $ 8,174 | $ 8,939 | $ 16,074 | $ 17,127 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Mar. 15, 2024 USD ($) $ / shares | Jan. 31, 2024 installment shares | Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) shares | Jun. 30, 2023 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based payment arrangement, expense | $ 27,409 | $ 31,695 | $ 52,302 | $ 61,068 | ||
Number of vesting installments | installment | 3 | |||||
Purchase price of common stock by employees percentage | 85% | |||||
Issuance of common stock under employee stock purchase plan | $ 5,046 | 6,174 | ||||
RSUs and PSUs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost, restricted stock | 188,900 | $ 188,900 | ||||
Unrecognized compensation, recognition period | 2 years 2 months 12 days | |||||
Granted (in shares) | shares | 2,101,535 | |||||
Performance Stock Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 1 year | |||||
Share-based payment arrangement, expense | 900 | $ 1,800 | ||||
Granted (in shares) | shares | 279,570 | |||||
Maximum target payout in shares (percent) | 200% | |||||
2015 Plan | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 3 years | |||||
2015 Plan | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Employee withholding percentage | 15% | |||||
2024 Bonus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based payment arrangement, expense | $ 400 | $ 400 | ||||
2023 Bonus Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based payment arrangement, expense | $ 500 | $ 1,100 | ||||
Shares to be issued under ESPP | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Issuance of common stock under employee stock purchase plan | $ 5,000 | |||||
Shares to be issued under ESPP | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share issued, price per share (in dollars per share) | $ / shares | $ 33.78 | |||||
Shares to be issued under ESPP | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share issued, price per share (in dollars per share) | $ / shares | $ 39.78 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Restricted Stock, Restricted Stock Units and Performance-Based Restricted Stock Units (Details) - RSUs and PSUs | 6 Months Ended |
Jun. 30, 2024 $ / shares shares | |
Shares | |
Unvested balance, Beginning balance (in shares) | shares | 2,714,426 |
Granted (in shares) | shares | 2,101,535 |
Vested (in shares) | shares | (781,389) |
Forfeited (in shares) | shares | (389,590) |
Unvested balance, Ending balance (in shares) | shares | 3,644,982 |
Weighted- Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 63.02 |
Granted (in dollars per share) | $ / shares | 53.97 |
Vested (in dollars per share) | $ / shares | 60.68 |
Forfeited (in dollars per share) | $ / shares | 61.04 |
Ending Balance (in dollars per share) | $ / shares | $ 58.42 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Dec. 31, 2023 | |
Shares | ||
Beginning balance (in shares) | 716,270 | |
Granted (in shares) | 0 | |
Exercised (in shares) | (120,322) | |
Forfeited/cancelled (in shares) | (450) | |
Ending balance (in shares) | 595,498 | 716,270 |
Vested and exercisable (in shares) | 595,498 | |
Weighted Average Exercise Price | ||
Beginning balance (in dollars per share) | $ 12.26 | |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 11.66 | |
Forfeited/cancelled (in dollars per share) | 7.73 | |
Ending balance (in dollars per share) | 12.39 | $ 12.26 |
Vested and exercisable (in dollars per share) | $ 12.39 | |
Weighted Average Remaining Contractual Life (in years) | ||
Outstanding | 1 year 8 months 8 days | 1 year 11 months 19 days |
Vested and exercisable | 1 year 8 months 8 days | |
Aggregate Intrinsic Value (in thousands) | ||
Exercised | $ 4,667 | |
Outstanding | 18,367 | $ 32,115 |
Vested and exercisable | $ 22,146 |
Net Income (Loss) per Share - S
Net Income (Loss) per Share - Summary of Basic and Diluted Net Loss Per Share of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Numerator: | ||||
Net income (loss) | $ 8,195 | $ (66,782) | $ 10,453 | $ (92,697) |
Denominator: | ||||
Weighted-average common shares outstanding, basic (in Shares) | 62,496,289 | 60,470,396 | 62,201,182 | 60,180,954 |
Weighted-average common shares outstanding, diluted (in Shares) | 74,250,360 | 60,470,396 | 74,135,121 | 60,180,954 |
Net income (loss) per share, basic (in dollars per share) | $ 0.13 | $ (1.10) | $ 0.17 | $ (1.54) |
Net income (loss) per share, diluted (in dollars per share) | $ 0.11 | $ (1.10) | $ 0.14 | $ (1.54) |
Net Income (Loss) per Share -_2
Net Income (Loss) per Share - Summary of Antidilutive Securities Excluded From Computation Diluted Weighted Average Shares Outstanding (Details) - shares | 3 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 15,546,869 | 14,391,515 |
Options to purchase common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 595,498 | 744,262 |
Unvested restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 3,644,982 | 3,838,671 |
Common stock issued in conjunction to acquisitions | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 36,923 | 115,041 |
Shares to be issued under ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 85,855 | 120,586 |
Convertible senior notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share amount (in shares) | 11,183,611 | 9,572,955 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - 3 months ended Jun. 30, 2024 ₪ in Millions, $ in Millions | ILS (₪) | USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||
Income Tax Examination Amount Assessed By Taxing Authorities | ₪ 324 | $ 87 |
Segment Information and Infor_3
Segment Information and Information about Geographic Areas - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2024 segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 1 |
Segment Information and Infor_4
Segment Information and Information about Geographic Areas - Summary of Net Revenues of Customer by Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total | $ 207,991 | $ 190,422 | $ 413,092 | $ 373,596 |
North America | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total | 159,322 | 149,683 | 316,662 | 293,564 |
Rest of world | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Total | $ 48,669 | $ 40,739 | $ 96,430 | $ 80,032 |
Segment Information and Infor_5
Segment Information and Information about Geographic Areas - Property and Equipment, Net By Geographic Area (Details) - USD ($) $ in Thousands | Jun. 30, 2024 | Dec. 31, 2023 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total | $ 34,884 | $ 39,642 |
North America | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total | 24,220 | 27,609 |
Rest of world | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total | $ 10,664 | $ 12,033 |
Restructuring - Additional Info
Restructuring - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Aug. 07, 2023 | Mar. 31, 2024 | Jun. 30, 2024 | |
Restructuring and Related Activities [Abstract] | |||
Workforce reduction percentage | 16% | ||
Restructuring charges | $ (200) | $ (190) |
Restructuring - Restructuring L
Restructuring - Restructuring Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Mar. 31, 2024 | Jun. 30, 2024 | |
Restructuring Liability | ||
Beginning balance | $ 3,764 | $ 3,764 |
Charges | $ (200) | (190) |
Payments | (3,574) | |
Ending balance | $ 0 |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent Event - Noetic Cyber, Inc, $ in Millions | Jul. 03, 2024 USD ($) installment employee |
Subsequent Event [Line Items] | |
Total cash consideration | $ 39.2 |
Value of equity to be issued | $ 2.3 |
Number of key employees | employee | 2 |
Number of Installments | installment | 3 |
Equity issuance period | 36 months |
Contingent consideration (up to) | $ 20 |
Business combination, earnout consideration | $ 6.9 |