Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 19, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-40994 | |
Entity Registrant Name | NerdWallet, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 45-4180440 | |
Entity Address, Address Line One | 55 Hawthorne Street | |
Entity Address, Address Line Two | 10th Floor | |
Entity Address, City or Town | San Francisco | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94105 | |
City Area Code | 415 | |
Local Phone Number | 549-8913 | |
Title of 12(b) Security | Class A common stock, $0.0001 par value | |
Trading Symbol | NRDS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Entity Central Index Key | 0001625278 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2024 | |
Current Fiscal Year End Date | --12-31 | |
Common Class A | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 46,052,254 | |
Common Class B | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 31,685,652 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 110.9 | $ 100.4 |
Accounts receivable—net | 93.9 | 75.5 |
Prepaid expenses and other current assets | 19.4 | 22.5 |
Total current assets | 224.2 | 198.4 |
Property, equipment and software—net | 50.6 | 52.6 |
Goodwill | 111.5 | 111.5 |
Intangible assets—net | 43.5 | 46.9 |
Right-of-use assets | 6.5 | 7.2 |
Other assets | 9.8 | 2 |
Total Assets | 446.1 | 418.6 |
Current liabilities: | ||
Accounts payable | 15.3 | 1.7 |
Accrued expenses and other current liabilities | 38.5 | 35.6 |
Total current liabilities | 53.8 | 37.3 |
Other liabilities—noncurrent | 13.6 | 14.4 |
Total liabilities | 67.4 | 51.7 |
Commitments and contingencies (Note 5) | ||
Stockholders’ equity: | ||
Preferred stock—$0.0001 par value per share—5,000 shares authorized; zero shares issued and outstanding | 0 | 0 |
Common stock—$0.0001 par value per share—296,686 shares authorized; 77,720 and 76,940 shares issued and outstanding as of March 31, 2024 and December 31, 2023 | 0 | 0 |
Additional paid-in capital | 494.5 | 483.7 |
Accumulated other comprehensive loss | (0.4) | (0.3) |
Accumulated deficit | (115.4) | (116.5) |
Total stockholders’ equity | 378.7 | 366.9 |
Total Liabilities and Stockholders’ Equity | $ 446.1 | $ 418.6 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per shares) | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per shares) | $ 0.0001 | $ 0.0001 |
Common stock, authorized (in shares) | 296,686,000 | 296,686,000 |
Common stock, issued (in shares) | 77,720,000 | 76,940,000 |
Common stock, outstanding (in shares) | 77,720,000 | 76,940,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Revenue | $ 161.9 | $ 169.6 |
Costs and Expenses: | ||
Cost of revenue | 14.2 | 13.8 |
Research and development | 20.7 | 19.5 |
Sales and marketing | 107.9 | 121.7 |
General and administrative | 15.4 | 15.4 |
Total costs and expenses | 158.2 | 170.4 |
Income (Loss) From Operations | 3.7 | (0.8) |
Other income, net: | ||
Interest income | 1.4 | 1 |
Interest expense | (0.2) | (0.2) |
Other losses, net | (0.1) | (0.1) |
Total other income, net | 1.1 | 0.7 |
Income (loss) before income taxes | 4.8 | (0.1) |
Income tax provision (benefit) | 3.7 | (1.8) |
Net Income | $ 1.1 | $ 1.7 |
Net Income Per Share Attributable to Common Stockholders | ||
Basic (in dollars per share) | $ 0.01 | $ 0.02 |
Diluted (in dollars per share) | $ 0.01 | $ 0.02 |
Weighted-average Shares Used in Computing Net Income Per Share Attributable to Common Stockholders | ||
Basic (in shares) | 77.2 | 75.8 |
Diluted (in shares) | 80.5 | 79.7 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net Income | $ 1.1 | $ 1.7 |
Other Comprehensive Income (Loss): | ||
Change in foreign currency translation | (0.1) | 0.2 |
Comprehensive Income | $ 1 | $ 1.9 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Millions | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2022 | 75,120 | ||||
Beginning balance at Dec. 31, 2022 | $ 341.7 | $ 0 | $ 427.3 | $ (0.9) | $ (84.7) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of Class A common stock upon exercise of stock options (in shares) | 1,226 | ||||
Issuance of Class A common stock upon exercise of stock options | 8.4 | 8.4 | |||
Issuance of Class A common stock pursuant to settlement of restricted stock units (in shares) | 380 | ||||
Issuance of Class A common stock pursuant to settlement of restricted stock units | 0 | ||||
Class A common stock withheld related to net share settlement of restricted stock units (in shares) | (15) | ||||
Class A common stock withheld related to net share settlement of restricted stock units | (0.3) | (0.3) | |||
Stock-based compensation | 10.1 | 10.1 | |||
Other comprehensive income (loss) | 0.2 | 0.2 | |||
Net Income | 1.7 | 1.7 | |||
Ending balance (in shares) at Mar. 31, 2023 | 76,711 | ||||
Ending balance at Mar. 31, 2023 | $ 361.8 | $ 0 | 445.5 | (0.7) | (83) |
Beginning balance (in shares) at Dec. 31, 2023 | 76,940 | 76,940 | |||
Beginning balance at Dec. 31, 2023 | $ 366.9 | $ 0 | 483.7 | (0.3) | (116.5) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Issuance of Class A common stock upon exercise of stock options (in shares) | 276 | ||||
Issuance of Class A common stock upon exercise of stock options | 1.7 | 1.7 | |||
Issuance of Class A common stock pursuant to settlement of restricted stock units (in shares) | 529 | ||||
Issuance of Class A common stock pursuant to settlement of restricted stock units | 0 | ||||
Class A common stock withheld related to net share settlement of restricted stock units (in shares) | (25) | ||||
Class A common stock withheld related to net share settlement of restricted stock units | (0.5) | (0.5) | |||
Stock-based compensation | 9.6 | 9.6 | |||
Other comprehensive income (loss) | (0.1) | (0.1) | |||
Net Income | $ 1.1 | 1.1 | |||
Ending balance (in shares) at Mar. 31, 2024 | 77,720 | 77,720 | |||
Ending balance at Mar. 31, 2024 | $ 378.7 | $ 0 | $ 494.5 | $ (0.4) | $ (115.4) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating Activities: | ||
Net Income | $ 1.1 | $ 1.7 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 11.9 | 11.7 |
Stock-based compensation | 8.7 | 8.6 |
Deferred taxes | (0.1) | (0.1) |
Non-cash lease costs | 0.5 | 0.7 |
Other, net | 0.2 | 1.4 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (18.5) | (11.8) |
Prepaid expenses and other assets | 3 | (2.6) |
Accounts payable | 13.4 | 8.6 |
Accrued expenses and other current liabilities | 3 | (0.8) |
Operating lease liabilities | (0.8) | (0.7) |
Other liabilities | 0.3 | (0.3) |
Net cash provided by operating activities | 22.7 | 16.4 |
Investing Activities: | ||
Purchase of investment | (8.1) | 0 |
Capitalized software development costs | (5.4) | (7.3) |
Purchase of property and equipment | 0 | (0.3) |
Net cash used in investing activities | (13.5) | (7.6) |
Financing Activities: | ||
Proceeds from line of credit | 0 | 7.5 |
Payments on line of credit | 0 | (7.5) |
Proceeds from exercise of stock options | 1.7 | 8.4 |
Tax payments related to net-share settlements on restricted stock units | (0.4) | (0.3) |
Net cash provided by financing activities | 1.3 | 8.1 |
Net increase in cash and cash equivalents | 10.5 | 16.9 |
Cash and Cash Equivalents: | ||
Beginning of period | 100.4 | 83.9 |
End of period | 110.9 | 100.8 |
Supplemental Disclosures of Non-Cash Investing and Financing Activities: | ||
Capitalized software development costs recorded in accounts payable and accrued expenses and other current liabilities | 0.6 | 0.7 |
Purchase of property and equipment recorded in accounts payable and accrued expenses and other current liabilities | 0 | 0.1 |
Supplemental Disclosures of Cash Flow Information: | ||
Income tax payments | 0.2 | 0.3 |
Cash paid for interest | 0.1 | 0 |
Supplemental Cash Flow Disclosure Related to Operating Leases: | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 1 | $ 0.9 |
The Company and Basis of Presen
The Company and Basis of Presentation | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company and Basis of Presentation | The Company and Basis of Presentation The Company— NerdWallet, Inc., a Delaware corporation, was formed on December 29, 2011. NerdWallet, Inc. and its subsidiaries (collectively, the Company) provide consumer-driven advice about personal finance through its platform by connecting individuals and small and mid-sized businesses (SMBs) with providers of financial products. Basis of Consolidation and Presentation— The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and applicable rules and regulations of the U.S. Securities and Exchange Commission regarding interim financial reporting. Accordingly, the accompanying unaudited interim condensed consolidated financial statements do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair statement of the Company’s financial position and results of operations for the periods presented. The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain comparative amounts for the three months ended March 31, 2023 have been reclassified to conform to the financial statement presentation as of and for the three months ended March 31, 2024. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year or any other future period. Significant Accounting Policies —During the three months ended March 31, 2024, the Company made a strategic investment of $8.1 million in equity securities of a privately-held company over which the Company does not exercise significant influence. See Note 4–Significant Condensed Consolidated Balance Sheet Components for further discussion. During the three months ended March 31, 2024, there have been no other material changes to the Company’s significant accounting policies as disclosed in Note 1–The Company and its Significant Accounting Policies in the notes to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue The following presents a disaggregation of the Company’s revenue based on product category: Three Months Ended (in millions) 2024 2023 Credit cards $ 50.0 $ 61.3 Loans 21.4 22.0 SMB products 30.4 25.2 Emerging verticals 60.1 61.1 Total revenue $ 161.9 $ 169.6 During the three months ended March 31, 2024, the Company recognized $4.1 million of revenue that was deferred as of December 31, 2023. Revenue recognized during the three months ended March 31, 2023 which was deferred as of December 31, 2022 was immaterial. The contract asset recorded within prepaid expenses and other current assets on the condensed consolidated balance sheet related to estimated variable consideration was $6.5 million and $5.5 million as of March 31, 2024 and December 31, 2023, respectively. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company’s assets that are measured at fair value on a recurring basis, by level, within the fair value hierarchy are summarized as follows: (in millions) Quoted Prices Other Significant Total As of March 31, 2024 Assets: Cash and cash equivalents—money market funds $ 14.9 $ — $ — $ 14.9 Certificate of deposit — 2.1 — 2.1 $ 14.9 $ 2.1 $ — $ 17.0 (in millions) Quoted Prices Other Significant Total As of December 31, 2023 Assets: Cash and cash equivalents—money market funds $ 89.8 $ — $ — $ 89.8 Certificate of deposit — 2.1 — 2.1 $ 89.8 $ 2.1 $ — $ 91.9 |
Significant Condensed Consolida
Significant Condensed Consolidated Balance Sheet Components | 3 Months Ended |
Mar. 31, 2024 | |
Significant Consolidated Balance Sheet Components [Abstract] | |
Significant Condensed Consolidated Balance Sheet Components | Significant Condensed Consolidated Balance Sheet Components Property, equipment and software, net includes capitalized software development costs, net of accumulated amortization, of $47.4 million and $49.0 million as of March 31, 2024 and December 31, 2023, respectively. The Company capitalized $6.4 million and $8.6 million of software development costs during the three months ended March 31, 2024 and 2023, respectively. The Company recorded amortization expense related to capitalized software development costs of $8.0 million and $6.6 million during the three months ended March 31, 2024 and 2023, respectively. During the three months ended March 31, 2024, the Company made a strategic investment of $8.1 million in equity securities of a privately-held company over which the Company does not exercise significant influence. These equity securities do not have a readily determinable fair value and are accounted for under the measurement alternative. Under the measurement alternative, the carrying value of the security is measured at cost less any impairment, and adjusted for changes resulting from observable price changes in orderly transactions for identical or similar securities of the same issuer. An equity security without a readily determinable fair value is considered impaired when the fair value of the Company’s interest is less than the carrying value. Equity investments without readily determinable fair values are included in other assets on the Company’s condensed consolidated balance sheet, and any related gains or losses would be included in other gains (losses), net on the Company’s condensed consolidated statements of operations. Equity investments without readily determinable fair values were $8.1 million as of March 31, 2024, and there were no related changes in carrying amount or impairment during the three months ended March 31, 2024. Accrued expenses and other current liabilities Other liabilities—noncurrent |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments and Other Financial Arrangements —The Company has certain financial commitments and other arrangements including unused letters of credit and commitments under leases. As of March 31, 2024, there were no material changes to the Company’s commitments and other financial arrangements as disclosed in Note 8–Commitments and Contingencies in the notes to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. Litigation and Other Legal Matters —The Company is involved from time to time in litigation, claims, and proceedings. Periodically, the Company evaluates the status of each legal matter and assesses potential financial exposure. If the potential loss from any legal proceeding or litigation is considered probable and the amount can be reasonably estimated, the Company accrues a liability for the estimated loss. Significant judgment is required to determine the probability of a loss and whether the amount of the loss is reasonably estimable. The outcome of any proceeding is not determinable in advance. As a result, the assessment of a potential liability and the amount of accruals recorded are based only on the information available at the time. As additional information becomes available, the Company reassesses the potential liability related to the legal proceeding or litigation, and may revise its estimates. Management is not currently aware of any matters that it expects will have a material effect on the financial position, results of operations, or cash flows of the Company. The Company has not accrued any material potential loss as of March 31, 2024 or December 31, 2023. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2024 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Share Repurchase Plans —On May 2, 2023, the Company announced that its Board of Directors authorized a plan under which the Company may repurchase up to $20 million of the Company’s Class A common stock and, following the Company’s utilization of that share repurchase authorization, the Company announced on October 26, 2023 that its Board of Directors approved a share repurchase authorization under which the Company may repurchase up to an additional $30 million of the Company’s Class A common stock (collectively, the Repurchase Plans). There were no repurchases of shares of Class A common stock during the three months ended March 31, 2024. The remaining share repurchase authorization under the Repurchase Plans is $30 million as of March 31, 2024. Equity Incentive Plans —The 2021 Equity Incentive Plan and the predecessor 2012 Equity Incentive Plan, both as amended, along with the 2022 Inducement Equity Incentive Plan (collectively, the Plans) comprise the equity incentive plans of the Company. Under the terms of the 2021 Equity Incentive Plan, the number of shares of Class A common stock reserved for issuance under the plan will automatically increase on January 1 of each calendar year, starting January 1, 2023 and ending on and including January 1, 2031, in an amount equal to 5% of the total number of shares of the Company’s capital stock outstanding on December 31 of the prior calendar year, unless the Company’s Board of Directors determines prior to the date of increase that there will be a lesser increase, or no increase. In accordance with these plan terms, the aggregate number of shares of Class A common stock reserved for issuance under the 2021 Equity Incentive Plan increased by 3.8 million shares effective January 1, 2024. Stock Options —A summary of the Company’s stock option activity for its Plans is as follows: Outstanding Stock Options (in thousands) Weighted-Average Weighted-Average Remaining Contractual Life (in years) Aggregate Intrinsic Value (in millions) Balance as of December 31, 2023 4,112 $ 10.84 6.3 $ 18.7 Granted 1 220 $ 15.73 Exercised (276) $ 6.12 Cancelled/forfeited (19) $ 12.77 Balance as of March 31, 2024 1 4,037 $ 11.42 6.4 $ 16.2 Vested and exercisable as of March 31, 2024 2,857 $ 10.77 5.7 $ 13.2 ______________ (1) Represents 0.2 million of target award stock options with both service-based and performance-based conditions. The weighted-average grant-date fair value of options granted during the three months ended March 31, 2024 was $9.08 per share. The aggregate intrinsic value of options exercised was $2.8 million for the three months ended March 31, 2024. During the three months ended March 31, 2024, the Company granted 0.2 million of target award stock options with both service-based and performance-based conditions to certain employees of the Company. Recipients of these performance-based stock options are eligible to earn between 0% and 200% of their target awards based upon the achievement of (i) a revenue-related growth metric and (ii) a non-GAAP operating income-related metric, both in fiscal year 2024, subject to certification of the attainment of the performance levels. These performance-based stock options are also subject to service-based vesting over a period of three years. For the three months ended March 31, 2024, the per-share fair value of each stock option granted was determined on the date of grant using the following weighted-average assumptions: Three Months Ended Expected volatility 58.1 % Expected term (in years) 5.9 Expected dividend yield 0 % Risk-free interest rate 4.2 % There were no stock options granted for the three months ended March 31, 2023. Restricted Stock Units —A summary of the Company’s outstanding nonvested restricted stock units (RSUs) for its Plans is as follows: Number of Units (in thousands) Weighted-Average Nonvested as of December 31, 2023 1 6,788 $ 12.42 Granted 2 462 $ 15.62 Vested (529) $ 14.21 Forfeited 1 (367) $ 15.76 Nonvested as of March 31, 2024 2 6,354 $ 12.31 ______________ (1) Includes 0.2 million of target award RSUs with both service-based and performance-based conditions. (2) Includes 0.1 million of target award RSUs with both service-based and performance-based conditions. The total fair value of shares that vested under RSUs was $8.9 million during the three months ended March 31, 2024. During the three months ended March 31, 2024, the Company granted 0.1 million of target award RSUs with both service-based and performance-based conditions to certain employees of the Company. Recipients of these performance-based RSUs are eligible to earn between 0% and 200% of their target awards based upon the achievement of (i) a revenue-related growth metric and (ii) a non-GAAP operating income-related metric, both in fiscal year 2024, subject to certification of the attainment of the performance levels. These performance-based RSUs are also subject to service-based vesting over a period of three years. Employee Stock Purchase Plan —The terms of the Employee Stock Purchase Plan (ESPP) provide for automatic increases in the number of shares reserved for issuance on January 1 of each calendar year, beginning in 2023 and through 2031, subject to terms of the ESPP. In accordance with these plan terms, the aggregate number of Class A common stock authorized for issuance under the ESPP increased by 0.8 million effective January 1, 2024. The Company did not recognize any stock-based compensation related to the ESPP for the three months ended March 31, 2024, as the previous ESPP purchase period ended on December 31, 2023 and the next ESPP purchase period will begin on May 1, 2024. Prior to capitalizing amounts related to software development costs, the Company recognized stock-based compensation related to the ESPP of $1.0 million during the three months ended March 31, 2023. Stock-Based Compensation —The Company recognized stock-based compensation under the Plans and ESPP as follows: Three Months Ended (in millions) 2024 2023 Research and development $ 2.6 $ 2.4 Sales and marketing 2.5 3.3 General and administrative 3.6 2.9 Total stock-based compensation $ 8.7 $ 8.6 In addition, stock-based compensation capitalized related to software development costs was $0.9 million and $1.5 million during the three months ended March 31, 2024 and 2023, respectively. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Beginning with the three months ended June 30, 2023, the Company’s tax provision for interim periods was determined using a discrete effective tax rate method, as allowed by ASC Topic 740-270, Income Taxes, Interim Reporting . The Company’s tax provision for interim periods was previously determined using an estimated annual effective tax rate which was adjusted for discrete items occurring during the periods presented. The Company determined that since small changes in estimated “ordinary” income would result in significant changes in the estimated annual effective tax rate, the historical method would not provide a reliable estimate for the three months ended March 31, 2024. The primary difference between the Company’s effective tax rate and the statutory federal income tax rate is the full valuation allowance established on the Company’s federal, state and foreign deferred tax attributes. As of March 31, 2024 and December 31, 2023, the Company recorded a full valuation allowance against these net deferred tax assets as the Company believes that it is more likely than not that the Company will not be able to fully realize such net deferred tax assets. The Company’s judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact in the Company’s income tax provision in the period of change. |
Net Income Per Basic and Dilute
Net Income Per Basic and Diluted Share | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Net Income Per Basic and Diluted Share | Net Income Per Basic and Diluted Share The following table provides the basic and diluted per share computations for net income attributable to common stockholders: Three Months Ended (in millions, except per share amounts) 2024 2023 Numerator: Net income attributable to common stockholders—basic and diluted $ 1.1 $ 1.7 Denominator: Weighted-average shares of common stock—basic 77.2 75.8 Effect of dilutive stock options and restricted stock units 3.3 3.9 Weighted-average shares of common stock—diluted 80.5 79.7 Net income per share attributable to common stockholders: Basic $ 0.01 $ 0.02 Diluted $ 0.01 $ 0.02 The following common stock equivalents were excluded from the computation of diluted net income per share because including them would have been antidilutive: Three Months Ended (in millions) 2024 2023 Shares subject to outstanding stock options and restricted stock units 2.5 3.7 ESPP — 0.3 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net income (loss) | $ 1.1 | $ 1.7 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 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 |
Samuel Yount [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On February 20, 2024, Samuel Yount, General Manager, Consumer Credit, adopted a trading plan that is intended to satisfy the affirmative defense conditions of Rule 10b5-1 of the Exchange Act as currently in effect (the Yount Trading Plan). The Yount Trading Plan has a duration of July 2, 2024 to June 20, 2025, and provides for the sale of up to 948,597 shares of the Company’s Class A common stock. |
Name | Samuel Yount |
Title | General Manager, Consumer Credit |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | February 20, 2024 |
Arrangement Duration | 353 days |
Aggregate Available | 948,597 |
The Company and Basis of Pres_2
The Company and Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Consolidation and Presentation— The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) and applicable rules and regulations of the U.S. Securities and Exchange Commission regarding interim financial reporting. Accordingly, the accompanying unaudited interim condensed consolidated financial statements do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023. |
Consolidation | The accompanying unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain comparative amounts for the three months ended March 31, 2023 have been reclassified to conform to the financial statement presentation as of and for the three months ended March 31, 2024. The results of operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year or any other future period. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following presents a disaggregation of the Company’s revenue based on product category: Three Months Ended (in millions) 2024 2023 Credit cards $ 50.0 $ 61.3 Loans 21.4 22.0 SMB products 30.4 25.2 Emerging verticals 60.1 61.1 Total revenue $ 161.9 $ 169.6 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The Company’s assets that are measured at fair value on a recurring basis, by level, within the fair value hierarchy are summarized as follows: (in millions) Quoted Prices Other Significant Total As of March 31, 2024 Assets: Cash and cash equivalents—money market funds $ 14.9 $ — $ — $ 14.9 Certificate of deposit — 2.1 — 2.1 $ 14.9 $ 2.1 $ — $ 17.0 (in millions) Quoted Prices Other Significant Total As of December 31, 2023 Assets: Cash and cash equivalents—money market funds $ 89.8 $ — $ — $ 89.8 Certificate of deposit — 2.1 — 2.1 $ 89.8 $ 2.1 $ — $ 91.9 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Equity [Abstract] | |
Schedule of Stock Options | A summary of the Company’s stock option activity for its Plans is as follows: Outstanding Stock Options (in thousands) Weighted-Average Weighted-Average Remaining Contractual Life (in years) Aggregate Intrinsic Value (in millions) Balance as of December 31, 2023 4,112 $ 10.84 6.3 $ 18.7 Granted 1 220 $ 15.73 Exercised (276) $ 6.12 Cancelled/forfeited (19) $ 12.77 Balance as of March 31, 2024 1 4,037 $ 11.42 6.4 $ 16.2 Vested and exercisable as of March 31, 2024 2,857 $ 10.77 5.7 $ 13.2 ______________ (1) Represents 0.2 million of target award stock options with both service-based and performance-based conditions. |
Schedule of Weighted-Average Assumptions and Ranges of Fair Value of Common Stock | For the three months ended March 31, 2024, the per-share fair value of each stock option granted was determined on the date of grant using the following weighted-average assumptions: Three Months Ended Expected volatility 58.1 % Expected term (in years) 5.9 Expected dividend yield 0 % Risk-free interest rate 4.2 % |
Schedule of Outstanding Nonvested RSUs | A summary of the Company’s outstanding nonvested restricted stock units (RSUs) for its Plans is as follows: Number of Units (in thousands) Weighted-Average Nonvested as of December 31, 2023 1 6,788 $ 12.42 Granted 2 462 $ 15.62 Vested (529) $ 14.21 Forfeited 1 (367) $ 15.76 Nonvested as of March 31, 2024 2 6,354 $ 12.31 ______________ (1) Includes 0.2 million of target award RSUs with both service-based and performance-based conditions. (2) Includes 0.1 million of target award RSUs with both service-based and performance-based conditions. |
Schedule of Stock-based Compensation Expense | The Company recognized stock-based compensation under the Plans and ESPP as follows: Three Months Ended (in millions) 2024 2023 Research and development $ 2.6 $ 2.4 Sales and marketing 2.5 3.3 General and administrative 3.6 2.9 Total stock-based compensation $ 8.7 $ 8.6 |
Net Income Per Basic and Dilu_2
Net Income Per Basic and Diluted Share (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Net Income Per Share, Basic and Diluted | The following table provides the basic and diluted per share computations for net income attributable to common stockholders: Three Months Ended (in millions, except per share amounts) 2024 2023 Numerator: Net income attributable to common stockholders—basic and diluted $ 1.1 $ 1.7 Denominator: Weighted-average shares of common stock—basic 77.2 75.8 Effect of dilutive stock options and restricted stock units 3.3 3.9 Weighted-average shares of common stock—diluted 80.5 79.7 Net income per share attributable to common stockholders: Basic $ 0.01 $ 0.02 Diluted $ 0.01 $ 0.02 |
Schedule of Antidilutive Securities Excluded from Computation of Diluted Earnings Net Income Per Share | The following common stock equivalents were excluded from the computation of diluted net income per share because including them would have been antidilutive: Three Months Ended (in millions) 2024 2023 Shares subject to outstanding stock options and restricted stock units 2.5 3.7 ESPP — 0.3 |
The Company and Basis of Pres_3
The Company and Basis of Presentation (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Strategic investment of equity securities | $ 8.1 |
Revenue - Schedule of Disaggreg
Revenue - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 161.9 | $ 169.6 |
Credit cards | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 50 | 61.3 |
Loans | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 21.4 | 22 |
SMB products | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 30.4 | 25.2 |
Emerging verticals | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 60.1 | $ 61.1 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |||
Deferred revenue recognized | $ 4.1 | $ 0 | |
Contract assets | $ 6.5 | $ 5.5 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured on Recurring Basis (Details) - Recurring Basis - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Assets: | ||
Assets | $ 17 | $ 91.9 |
Certificate of deposit | ||
Assets: | ||
Certificate of deposit | 2.1 | 2.1 |
Quoted Prices in Active Markets (Level 1) | ||
Assets: | ||
Assets | 14.9 | 89.8 |
Quoted Prices in Active Markets (Level 1) | Certificate of deposit | ||
Assets: | ||
Certificate of deposit | 0 | 0 |
Other Observable Inputs (Level 2) | ||
Assets: | ||
Assets | 2.1 | 2.1 |
Other Observable Inputs (Level 2) | Certificate of deposit | ||
Assets: | ||
Certificate of deposit | 2.1 | 2.1 |
Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Certificate of deposit | ||
Assets: | ||
Certificate of deposit | 0 | 0 |
Money Market Funds | ||
Assets: | ||
Cash and cash equivalents—money market funds | 14.9 | 89.8 |
Money Market Funds | Quoted Prices in Active Markets (Level 1) | ||
Assets: | ||
Cash and cash equivalents—money market funds | 14.9 | 89.8 |
Money Market Funds | Other Observable Inputs (Level 2) | ||
Assets: | ||
Cash and cash equivalents—money market funds | 0 | 0 |
Money Market Funds | Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Cash and cash equivalents—money market funds | $ 0 | $ 0 |
Significant Condensed Consoli_2
Significant Condensed Consolidated Balance Sheet Components (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Significant Consolidated Balance Sheet Components [Abstract] | |||
Capitalized software development costs, net of accumulated amortization | $ 47.4 | $ 49 | |
Capitalized software development costs | 6.4 | $ 8.6 | |
Amortization of capitalized software | 8 | $ 6.6 | |
Strategic investment of equity securities | 8.1 | ||
Equity investments without readily determinable fair values | $ 8.1 | ||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities | |
Accrued expenses and other current liabilities including operating lease liabilities | $ 3.4 | $ 3.4 | |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other liabilities—noncurrent | Other liabilities—noncurrent | |
Other liabilities noncurrent including operating lease liabilities | $ 5.2 | $ 6.2 |
Stockholders' Equity - Share Re
Stockholders' Equity - Share Repurchase Plan (Details) - Common Class A - USD ($) $ in Millions | Mar. 31, 2024 | Oct. 26, 2023 | May 02, 2023 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock repurchase program, authorized amount | $ 30 | $ 20 | |
Stock repurchase program, remaining authorized amount | $ 30 |
Stockholders' Equity - Equity I
Stockholders' Equity - Equity Incentive Plan Narrative (Details) - 2021 Equity Incentive Plan - Common Class A - shares shares in Millions | Jan. 01, 2024 | Jan. 01, 2023 |
Class of Stock [Line Items] | ||
Increase in shares reserved for issuance (in shares) | 3.8 | |
Stock Options | ||
Class of Stock [Line Items] | ||
Annual increase in shares authorized, percentage | 5% |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Activity (Details) - Stock Options - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Outstanding Stock Options (in thousands) | |||
Beginning of period (in shares) | 4,112,000 | ||
Granted (in shares) | 220,000 | 0 | |
Exercised (in shares) | (276,000) | ||
Cancelled/forfeited (in shares) | (19,000) | ||
End of period (in shares) | 4,037,000 | 4,112,000 | |
Vested and exercisable (in shares) | 2,857,000 | ||
Weighted-Average Exercise Price | |||
Beginning of period (in dollars per share) | $ 10.84 | ||
Granted (in dollars per share) | 15.73 | ||
Exercised (in dollars per share) | 6.12 | ||
Cancelled/forfeited (in dollars per share) | 12.77 | ||
End of period (in dollars per share) | 11.42 | $ 10.84 | |
Vested and exercisable (in dollars per share) | $ 10.77 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |||
Weighted-Average Remaining Contractual Life (in years) | 6 years 4 months 24 days | 6 years 3 months 18 days | |
Vested and exercisable (in years) | 5 years 8 months 12 days | ||
Aggregate intrinsic value, outstanding | $ 16.2 | $ 18.7 | |
Aggregate intrinsic value, Vested and exercisable | $ 13.2 |
Stockholders' Equity - Stock _2
Stockholders' Equity - Stock Option Activity - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Granted, weighted average grant-date fair value (in dollars per share) | $ 9.08 | |
Stock Options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Aggregate intrinsic value, options exercised in period | $ 2.8 | |
Granted (in shares) | 220,000 | 0 |
Award vesting period (in years) | 3 years | |
Stock Options | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting rights percentage | 0% | |
Stock Options | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Award vesting rights percentage | 200% |
Stockholders' Equity - Stock _3
Stockholders' Equity - Stock Option Valuation Assumptions (Details) - Stock Options | 3 Months Ended |
Mar. 31, 2024 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 58.10% |
Expected term (in years) | 5 years 10 months 24 days |
Expected dividend yield | 0% |
Risk-free interest rate | 4.20% |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock Unit Activity (Details) shares in Thousands | 3 Months Ended |
Mar. 31, 2024 $ / shares shares | |
Restricted Stock Units (RSUs) | |
Number of Units (in thousands) | |
Beginning of period, nonvested (in shares) | 6,788 |
Granted (in shares) | 462 |
Vested (in shares) | (529) |
Forfeited (in shares) | (367) |
End of period, nonvested (in shares) | 6,354 |
Weighted-Average Grant-Date Fair Value | |
Beginning of period, nonvested weighted average grant date fair value (in dollars per share) | $ / shares | $ 12.42 |
Granted (in dollars per share) | $ / shares | 15.62 |
Vested (in dollars per share) | $ / shares | 14.21 |
Forfeited (in dollars per share) | $ / shares | 15.76 |
End of period, nonvested weighted average grant date fair value (in dollars per share) | $ / shares | $ 12.31 |
Forfeited (in shares) | 367 |
Granted (in shares) | 462 |
Restricted Stock Units, Service-Based And Performance-Based | |
Number of Units (in thousands) | |
Granted (in shares) | 100 |
Forfeited (in shares) | (200) |
Weighted-Average Grant-Date Fair Value | |
Forfeited (in shares) | 200 |
Granted (in shares) | 100 |
Stockholders' Equity - Restri_2
Stockholders' Equity - Restricted Stock Unit Activity Narrative (Details) shares in Thousands, $ in Millions | 3 Months Ended |
Mar. 31, 2024 USD ($) shares | |
Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Fair value of shares vested under RSUs during period | $ | $ 8.9 |
Granted (in shares) | 462 |
Restricted Stock Units, Service-Based And Performance-Based | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Granted (in shares) | 100 |
Award vesting period (in years) | 3 years |
Restricted Stock Units, Service-Based And Performance-Based | Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights percentage | 0% |
Restricted Stock Units, Service-Based And Performance-Based | Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Award vesting rights percentage | 200% |
Stockholders' Equity - Employee
Stockholders' Equity - Employee Stock Purchase Plan (Details) - USD ($) shares in Millions | 3 Months Ended | ||
Jan. 01, 2024 | Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 8,700,000 | $ 8,600,000 | |
ESPP | Class A Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of additional shares authorized (in shares) | 0.8 | ||
Share-based compensation expense | $ 0 | $ 1,000,000 |
Stockholders' Equity - Stock-Ba
Stockholders' Equity - Stock-Based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Share-based compensation expense | $ 8.7 | $ 8.6 |
Share-based compensation capitalized | 0.9 | 1.5 |
Research and development | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Share-based compensation expense | 2.6 | 2.4 |
Sales and marketing | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Share-based compensation expense | 2.5 | 3.3 |
General and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Share-based compensation expense | $ 3.6 | $ 2.9 |
Net Income Per Basic and Dilu_3
Net Income Per Basic and Diluted Share - Basic and Diluted Per Share Computations for Net Income (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Numerator: | ||
Net income attributable to common stockholders – basic | $ 1.1 | $ 1.7 |
Net income attributable to common stockholders – diluted | $ 1.1 | $ 1.7 |
Denominator: | ||
Weighted-average shares of common stock – basic (in shares) | 77.2 | 75.8 |
Effect of dilutive stock options and restricted stock units (in shares) | 3.3 | 3.9 |
Weighted-average shares of common stock - diluted (in shares) | 80.5 | 79.7 |
Net income per share attributable to common stockholders: | ||
Basic (in dollars per share) | $ 0.01 | $ 0.02 |
Diluted (in dollars per share) | $ 0.01 | $ 0.02 |
Net Income Per Basic and Dilu_4
Net Income Per Basic and Diluted Share - Schedule of Antidilutive Securities Excluded from Computation (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Shares subject to outstanding stock options and 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) | 2.5 | 3.7 |
ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 0.3 |