Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 30, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | TTD | |
Entity Registrant Name | TRADE DESK, INC. | |
Entity Central Index Key | 0001671933 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity File Number | 001-37879 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 27-1887399 | |
Entity Address, Address Line One | 42 N. Chestnut Street | |
Entity Address, City or Town | Ventura | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 93001 | |
City Area Code | 805 | |
Local Phone Number | 585-3434 | |
Title of 12(b) Security | Class A Common Stock, par value $0.000001 per share | |
Security Exchange Name | NASDAQ | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Class A common stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 43,121,618 | |
Class B common stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 4,455,645 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 471,637 | $ 437,353 |
Short-term investments, net | 208,446 | 186,685 |
Accounts receivable, net of allowance for credit losses of $7,323 and $7,253 as of March 31, 2021 and December 31, 2020, respectively | 1,368,668 | 1,584,109 |
Prepaid expenses and other current assets | 121,398 | 102,170 |
TOTAL CURRENT ASSETS | 2,170,149 | 2,310,317 |
Property and equipment, net | 115,914 | 115,863 |
Operating lease assets | 237,917 | 248,143 |
Deferred income taxes | 50,168 | 50,168 |
Other assets, non-current | 28,551 | 29,154 |
TOTAL ASSETS | 2,602,699 | 2,753,645 |
Current liabilities: | ||
Accounts payable | 1,142,258 | 1,348,480 |
Accrued expenses and other current liabilities | 83,530 | 88,335 |
Operating lease liabilities | 37,688 | 37,868 |
TOTAL CURRENT LIABILITIES | 1,263,476 | 1,474,683 |
Operating lease liabilities, non-current | 245,899 | 254,562 |
Other liabilities, non-current | 9,011 | 11,255 |
TOTAL LIABILITIES | 1,518,386 | 1,740,500 |
Commitments and contingencies (Note 10) | ||
STOCKHOLDERS’ EQUITY | ||
Preferred stock, par value $0.000001; 100,000 shares authorized, zero shares issued and outstanding as of March 31, 2021 and December 31, 2020 | ||
Common stock, par value $0.000001 Class A, 1,000,000 shares authorized; 43,025 and 42,338 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively Class B, 95,000 shares authorized; 4,506 and 5,002 shares issued and outstanding as of March 31, 2021 and December 31, 2020, respectively | 0 | 0 |
Additional paid-in capital | 587,304 | 538,778 |
Retained earnings | 497,009 | 474,367 |
TOTAL STOCKHOLDERS’ EQUITY | 1,084,313 | 1,013,145 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 2,602,699 | $ 2,753,645 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Accounts receivable, allowance for credit losses | $ 7,323 | $ 7,253 |
Preferred stock | ||
Preferred stock, par value (in dollars per share) | $ 0.000001 | $ 0.000001 |
Preferred stock, authorized shares | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock | ||
Common stock, par value (in dollars per share) | $ 0.000001 | $ 0.000001 |
Class A common stock | ||
Common stock | ||
Common stock, authorized shares | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 43,025,000 | 42,338,000 |
Common stock, shares outstanding | 43,025,000 | 42,338,000 |
Class B common stock | ||
Common stock | ||
Common stock, authorized shares | 95,000,000 | 95,000,000 |
Common stock, shares issued | 4,506,000 | 5,002,000 |
Common stock, shares outstanding | 4,506,000 | 5,002,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Revenue | $ 219,811 | $ 160,660 |
Type of Revenue [Extensible List] | us-gaap:ServiceMember | us-gaap:ServiceMember |
Operating expenses: | ||
Platform operations | $ 50,500 | $ 40,208 |
Type of Cost, Good or Service [Extensible List] | us-gaap:ServiceMember | us-gaap:ServiceMember |
Sales and marketing | $ 55,764 | $ 34,294 |
Technology and development | 53,918 | 36,794 |
General and administrative | 51,845 | 38,598 |
Total operating expenses | 212,027 | 149,894 |
Income from operations | 7,784 | 10,766 |
Other expense (income): | ||
Interest expense (income), net | 45 | (817) |
Foreign currency exchange loss (gain), net | (353) | 1,234 |
Total other expense (income), net | (308) | 417 |
Income before income taxes | 8,092 | 10,349 |
Benefit from income taxes | (14,550) | (13,708) |
Net income | $ 22,642 | $ 24,057 |
Earnings per share: | ||
Basic | $ 0.48 | $ 0.53 |
Diluted | $ 0.45 | $ 0.50 |
Weighted average shares outstanding: | ||
Basic | 47,282 | 45,501 |
Diluted | 49,792 | 48,313 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-In Capital | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment |
Balance at beginning of period at Dec. 31, 2019 | $ 612,517 | $ (388) | $ 380,079 | $ 232,438 | $ (388) | |
Balance at beginning of period (in shares) at Dec. 31, 2019 | 45,476 | |||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | |||||
Exercise of common stock options | $ 19,478 | 19,478 | ||||
Exercise of common stock options (in shares) | 539 | |||||
Restricted stock, net of forfeitures and shares withheld for taxes | (4,893) | (4,893) | ||||
Restricted stock, net of forfeitures and shares withheld for taxes (in shares) | 20 | |||||
Stock-based compensation | 23,263 | 23,263 | ||||
Net income | 24,057 | 24,057 | ||||
Balance at end of period at Mar. 31, 2020 | 674,034 | 417,927 | 256,107 | |||
Balance at end of period (in shares) at Mar. 31, 2020 | 46,035 | |||||
Balance at beginning of period at Dec. 31, 2020 | 1,013,145 | 538,778 | 474,367 | |||
Balance at beginning of period (in shares) at Dec. 31, 2020 | 47,340 | |||||
Exercise of common stock options | 12,621 | 12,621 | ||||
Exercise of common stock options (in shares) | 180 | |||||
Restricted stock, net of forfeitures and shares withheld for taxes | (17,080) | (17,080) | ||||
Restricted stock, net of forfeitures and shares withheld for taxes (in shares) | 11 | |||||
Stock-based compensation | 52,985 | 52,985 | ||||
Net income | 22,642 | 22,642 | ||||
Balance at end of period at Mar. 31, 2021 | $ 1,084,313 | $ 587,304 | $ 497,009 | |||
Balance at end of period (in shares) at Mar. 31, 2021 | 47,531 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
OPERATING ACTIVITIES: | ||
Net income | $ 22,642 | $ 24,057 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 10,011 | 6,477 |
Stock-based compensation | 52,354 | 22,965 |
Allowance for credit losses on accounts receivable | 203 | 1,310 |
Noncash lease expense | 9,451 | 7,402 |
Other | 4,905 | 3,484 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 208,847 | 210,552 |
Prepaid expenses and other assets | (16,180) | (15,791) |
Accounts payable | (200,578) | (205,967) |
Accrued expenses and other liabilities | (5,691) | 960 |
Operating lease liabilities | (10,894) | (2,673) |
Net cash provided by operating activities | 75,070 | 52,776 |
INVESTING ACTIVITIES: | ||
Purchases of investments | (89,354) | (35,931) |
Sales of investments | 4,539 | |
Maturities of investments | 62,670 | 39,180 |
Purchases of property and equipment | (13,120) | (18,310) |
Capitalized software development costs | (1,062) | (965) |
Net cash used in investing activities | (36,327) | (16,026) |
FINANCING ACTIVITIES: | ||
Proceeds from line of credit | 143,000 | |
Proceeds from exercise of stock options | 12,621 | 19,478 |
Taxes paid related to net settlement of restricted stock awards | (17,080) | (4,893) |
Net cash provided by (used in) financing activities | (4,459) | 157,585 |
Increase in cash and cash equivalents | 34,284 | 194,335 |
Cash and cash equivalents—Beginning of period | 437,353 | 130,876 |
Cash and cash equivalents—End of period | 471,637 | 325,211 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Capitalized assets financed by accounts payable | 2,421 | 10,200 |
Cash paid for amounts included in the measurement of lease liabilities included in operating cash flows | 15,107 | 4,902 |
Increase (decrease) in right-of-use assets obtained in exchange for operating lease liabilities | (937) | 34,155 |
Asset retirement obligation | 625 | 65 |
Stock-based compensation included in capitalized software development costs | $ 631 | $ 298 |
Nature of Operations
Nature of Operations | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Nature of Operations | Note 1—Nature of Operations The Trade Desk, Inc. (the “Company”) was formed in November 2009 as a Delaware corporation. The Company is headquartered in Ventura, California and has offices in various cities in North America, Europe, Asia and Australia. The Company is a technology company that empowers buyers of advertising by providing a self-service cloud-based platform on which ad buyers can create, manage, and optimize more expressive data-driven digital advertising campaigns across ad formats, including display, video, audio, native and, social, on a multitude of devices, such as computers, mobile devices, and connected TV. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Note 2—Basis of Presentation and Summary of Significant Accounting Policies The accompanying condensed consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and are unaudited. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. The condensed consolidated balance sheet as of December 31, 2020 was derived from audited financial statements but does not include all disclosures required by GAAP. There have been no changes to the Company’s accounting policies from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2020, and these unaudited interim condensed consolidated financial statements have been prepared on a basis consistent with that used to prepare the Company’s audited annual consolidated financial statements for the year ended December 31, 2020, and include, in the opinion of management, all adjustments, consisting of normal recurring items, necessary for the fair statement of the condensed consolidated financial statements. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results expected for the full year ending December 31, 2021. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from these estimates. As of March 31, 2021, the impact of the Coronavirus pandemic (“COVID-19”) on our business continued to evolve. As a result, many of our estimates and assumptions, including the allowance for credit losses, consider macro-economic factors in the market, which require increased judgment and carry a higher degree of variability and volatility. As events continue to evolve and additional information becomes available, our estimates may change materially in future periods. For the three months ended March 31, 2021, the Company’s assessment considered business and market disruptions caused by COVID-19 and estimates of credit defaults by industry. We continue to monitor the financial implications of COVID-19 on expected credit losses. The Company reviews the allowance for credit losses and financial implications of COVID-19 on expected credit losses on a quarterly basis. Account balances are charged off against the allowance when the Company believes it is probable the receivable will not be recovered. Recent Accounting Pronouncements As of March 31, 2021, the Company has adopted the FASB’s Accounting Standards Update No. 2019-12, Income Taxes (Topic 740) which simplifies the accounting for income taxes, the impacts of which were immaterial. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 3—Earnings Per Share The Company has two classes of common stock, Class A and Class B. Basic and diluted earnings per share (“EPS”) attributable to common stockholders for Class A and Class B common stock were the same because they were entitled to the same liquidation and dividend rights. The computation of basic and diluted EPS is as follows (in thousands, except per share amounts): Three Months Ended March 31, 2021 2020 Numerator: Net income $ 22,642 $ 24,057 Denominator: Weighted-average shares outstanding—basic 47,282 45,501 Effect of dilutive securities: Options to purchase common stock 2,063 2,447 Employee stock purchase plan shares 79 116 Restricted stock 368 249 Weighted-average shares outstanding—diluted 49,792 48,313 Basic EPS $ 0.48 $ 0.53 Diluted EPS $ 0.45 $ 0.50 Anti-dilutive equity awards under stock-based award plans excluded from the determination of diluted EPS 26 388 |
Cash, Cash Equivalents and Shor
Cash, Cash Equivalents and Short-Term Investments | 3 Months Ended |
Mar. 31, 2021 | |
Cash Cash Equivalents And Short Term Investments [Abstract] | |
Cash, Cash Equivalents and Short-Term Investments | Note 4—Cash, Cash Equivalents and Short-Term Investments Cash, cash equivalents and short-term investments in marketable securities were as follows (in thousands): As of March 31, 2021 Cash and Cash Short-Term Equivalents Investments Total Cash $ 163,241 $ — $ 163,241 Level 1: Money market funds 265,790 — 265,790 Level 2: Commercial paper 36,969 97,698 134,667 Corporate debt securities 5,637 64,333 69,970 U.S. government and agency securities — 46,415 46,415 Total $ 471,637 $ 208,446 $ 680,083 As of December 31, 2020 Cash and Cash Short-Term Equivalents Investments Total Cash $ 132,372 $ — $ 132,372 Level 1: Money market funds 259,434 — 259,434 Level 2: Commercial paper 45,547 63,372 108,919 Corporate debt securities — 79,342 79,342 U.S. government and agency securities — 43,971 43,971 Total $ 437,353 $ 186,685 $ 624,038 The Company’s gross unrealized gains or losses from its short-term investments, recorded at fair value, for the three months ended March 31, 2021 and 2020, were immaterial. The contractual maturities of the Company’s short-term investments are as follows (in thousands): March 31, 2021 Due in one year $ 184,621 Due in one to two years 23,825 Total $ 208,446 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Leases | Note 5—Leases The components of lease expense recorded in the condensed consolidated statements of operations were as follows (in thousands): Three Months Ended March 31, 2021 2020 Operating lease cost $ 13,095 $ 9,538 Short-term lease cost 171 239 Variable lease cost 1,923 811 Sublease income (650 ) (990 ) Total lease cost $ 14,539 $ 9,598 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Note 6—Debt Credit Facility As of March 31, 2021, the Company did not have an outstanding debt balance under the Second Amended and Restated Loan and Security Agreement (the “credit facility”). In March 2020, the Company drew down $143.0 million under the credit facility as a precautionary measure to provide increased liquidity and preserve financial flexibility in light of the worldwide decline in business activity brought about by the COVID-19 pandemic. By October 2020, the Company repaid the balance on the credit facility from available working capital. Availability under the credit facility was $143.6 million as of March 31, 2021. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | Note 7—Stock-Based Compensation Stock-Based Compensation Expense Stock-based compensation expense recorded in the condensed consolidated statements of income was as follows (in thousands): Three Months Ended March 31, 2021 2020 Platform operations $ 5,015 $ 1,462 Sales and marketing 13,684 5,314 Technology and development 16,094 8,590 General and administrative 17,561 7,599 Total $ 52,354 $ 22,965 Stock Options The following summarizes stock option activity: Shares Under Option (in thousands) Weighted- Average Exercise Price Outstanding as of December 31, 2020 2,648 $ 107.26 Granted 3 738.85 Exercised (179 ) 70.49 Cancelled (65 ) 154.39 Outstanding as of March 31, 2021 2,407 $ 109.40 Exercisable as of March 31, 2021 1,374 $ 65.09 On January 1, 2021, the number of shares authorized for grant under the Company’s 2016 Incentive Award Plan was increased by 1.9 million shares in accordance with plan provisions. Restricted Stock The following summarizes restricted stock activity: RSU (in thousands) Weighted- Average Grant Date Fair Value Unvested as of December 31, 2020 570 $ 261.03 Granted 22 759.30 Vested (53 ) 178.88 Forfeited (27 ) 203.20 Unvested as of March 31, 2021 512 $ 294.24 Employee Stock Purchase Plan (“ESPP”) Stock-based compensation expense related to the ESPP totaled $25.6 million and $7.8 million for the three months ended March 31, 2021 and 2020, respectively. On January 1, 2021, the number of shares available for issuance under the Company’s ESPP was increased by 0.4 million shares in accordance with plan provisions. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8—Income Taxes In determining the interim provision for income taxes for the three months ended March 31, 2021, the Company utilized the annual estimated effective tax rate applied to the actual year-to-date income and added the tax effects of any discrete items in the reporting period in which they occur. In determining the interim provision for income taxes for the three months ended March 31, 2020, the Company utilized the discrete effective tax rate method, as allowed by Accounting Standards Codification (“ASC”) 740-270-30-18, “Income Taxes – Interim Reporting”. For the three months ended March 31, 2021 and 2020, the benefit from income taxes included $25.9 million and $24.3 million, respectively, of benefits associated with stock-based awards. For the three months ended March 31, 2021, and 2020, the Company’s effective tax rate differed from the United States federal statutory tax rate of 21% primarily due to state and foreign taxes, the impact of tax benefits associated with employee exercises of stock options and vesting of restricted stock units, nondeductible stock-based compensation, and research and development tax credits. There were no material changes to the Company’s unrecognized tax benefits during the three months ended March 31, 2021, and the Company does not expect to have any significant changes to unrecognized tax benefits through the end of the fiscal year. |
Geographic Information
Geographic Information | 3 Months Ended |
Mar. 31, 2021 | |
Segments Geographical Areas [Abstract] | |
Geographic Information | Note 9—Geographic Information The Company reports revenue net of amounts it pays suppliers for the cost of advertising inventory, third-party data and other add-on features (collectively, “Supplier Features”). The Company generally bills clients for the gross amount of Supplier Features they purchase through its platform and the platform fees, net of allowances (“Gross Billings”). The Company’s accounts receivable are recorded at the amount of Gross Billings for the amounts it is responsible to collect, and accounts payable are recorded at the net amount payable to suppliers. Accordingly, both accounts receivable and accounts payable appear large in relation to revenue reported on a net basis. Gross Billings, set forth as a percentage, based on the billing address of the clients or client affiliates, were as follows: Three Months Ended March 31, 2021 2020 U.S. 86 % 87 % International 14 % 13 % Total 100 % 100 % |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 10— Commitments and Contingencies Guarantees and Indemnification In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to clients, vendors, lessors, business partners, and other parties with respect to certain matters, including, but not limited to, losses arising out of breach of such agreements, services to be provided by the Company or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with directors and certain officers and employees that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees. No demands have been made upon the Company to provide indemnification under such agreements, and thus, there are no claims that the Company is aware of that could have a material effect on the Company’s balance sheet, statement of income or statement of cash flows. Accordingly, no amounts for any obligation have been recorded at March 31, 2021. Litigation From time to time, the Company is subject to various legal proceedings and claims, either asserted or unasserted, that arise in the ordinary course of business. Although the outcome of the various legal proceedings and claims cannot be predicted with certainty, management does not believe that any of these proceedings or other claims will have a material adverse effect on the Company’s business, financial condition, results of operations or cash flows. Employment Contracts The Company has entered into agreements with severance terms with certain employees and officers, all of whom are employed on an at-will basis, subject to certain severance obligations in the event of certain involuntary terminations. The Company may be required to accelerate the vesting of certain stock options in the event of changes in control, as defined, and involuntary terminations. |
Subsequent Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Event | Note 11— Subsequent Event On May 10, 2021, the Company announced that its Board of Directors approved a ten-for-one The following table summarizes the basic EPS and diluted EPS calculations on a pro-forma basis after giving retroactive effect to the ten-for-one split: Three Months Ended March 31, 2021 2020 Pro-forma Basic EPS $ 0.05 $ 0.05 Pro-forma Diluted EPS $ 0.05 $ 0.05 |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from these estimates. As of March 31, 2021, the impact of the Coronavirus pandemic (“COVID-19”) on our business continued to evolve. As a result, many of our estimates and assumptions, including the allowance for credit losses, consider macro-economic factors in the market, which require increased judgment and carry a higher degree of variability and volatility. As events continue to evolve and additional information becomes available, our estimates may change materially in future periods. For the three months ended March 31, 2021, the Company’s assessment considered business and market disruptions caused by COVID-19 and estimates of credit defaults by industry. We continue to monitor the financial implications of COVID-19 on expected credit losses. The Company reviews the allowance for credit losses and financial implications of COVID-19 on expected credit losses on a quarterly basis. Account balances are charged off against the allowance when the Company believes it is probable the receivable will not be recovered. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements As of March 31, 2021, the Company has adopted the FASB’s Accounting Standards Update No. 2019-12, Income Taxes (Topic 740) which simplifies the accounting for income taxes, the impacts of which were immaterial. In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted EPS | The computation of basic and diluted EPS is as follows (in thousands, except per share amounts): Three Months Ended March 31, 2021 2020 Numerator: Net income $ 22,642 $ 24,057 Denominator: Weighted-average shares outstanding—basic 47,282 45,501 Effect of dilutive securities: Options to purchase common stock 2,063 2,447 Employee stock purchase plan shares 79 116 Restricted stock 368 249 Weighted-average shares outstanding—diluted 49,792 48,313 Basic EPS $ 0.48 $ 0.53 Diluted EPS $ 0.45 $ 0.50 Anti-dilutive equity awards under stock-based award plans excluded from the determination of diluted EPS 26 388 |
Cash, Cash Equivalents and Sh_2
Cash, Cash Equivalents and Short-Term Investments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Cash Cash Equivalents And Short Term Investments [Abstract] | |
Schedule of Cash, Cash Equivalents and Short-term Investments in Marketable Securities | Cash, cash equivalents and short-term investments in marketable securities were as follows (in thousands): As of March 31, 2021 Cash and Cash Short-Term Equivalents Investments Total Cash $ 163,241 $ — $ 163,241 Level 1: Money market funds 265,790 — 265,790 Level 2: Commercial paper 36,969 97,698 134,667 Corporate debt securities 5,637 64,333 69,970 U.S. government and agency securities — 46,415 46,415 Total $ 471,637 $ 208,446 $ 680,083 As of December 31, 2020 Cash and Cash Short-Term Equivalents Investments Total Cash $ 132,372 $ — $ 132,372 Level 1: Money market funds 259,434 — 259,434 Level 2: Commercial paper 45,547 63,372 108,919 Corporate debt securities — 79,342 79,342 U.S. government and agency securities — 43,971 43,971 Total $ 437,353 $ 186,685 $ 624,038 |
Schedule of Contractual Maturities of Short-Term Investments | The contractual maturities of the Company’s short-term investments are as follows (in thousands): March 31, 2021 Due in one year $ 184,621 Due in one to two years 23,825 Total $ 208,446 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Leases [Abstract] | |
Summary of Components of Lease Expense | The components of lease expense recorded in the condensed consolidated statements of operations were as follows (in thousands): Three Months Ended March 31, 2021 2020 Operating lease cost $ 13,095 $ 9,538 Short-term lease cost 171 239 Variable lease cost 1,923 811 Sublease income (650 ) (990 ) Total lease cost $ 14,539 $ 9,598 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense recorded in the condensed consolidated statements of income was as follows (in thousands): Three Months Ended March 31, 2021 2020 Platform operations $ 5,015 $ 1,462 Sales and marketing 13,684 5,314 Technology and development 16,094 8,590 General and administrative 17,561 7,599 Total $ 52,354 $ 22,965 |
Summary of Stock Option Activity | The following summarizes stock option activity: Shares Under Option (in thousands) Weighted- Average Exercise Price Outstanding as of December 31, 2020 2,648 $ 107.26 Granted 3 738.85 Exercised (179 ) 70.49 Cancelled (65 ) 154.39 Outstanding as of March 31, 2021 2,407 $ 109.40 Exercisable as of March 31, 2021 1,374 $ 65.09 |
Summary of Restricted Stock Activity | The following summarizes restricted stock activity: RSU (in thousands) Weighted- Average Grant Date Fair Value Unvested as of December 31, 2020 570 $ 261.03 Granted 22 759.30 Vested (53 ) 178.88 Forfeited (27 ) 203.20 Unvested as of March 31, 2021 512 $ 294.24 |
Geographic Information (Tables)
Geographic Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segments Geographical Areas [Abstract] | |
Gross Billings Percentage, Based on Billing Address of Clients or Client Affiliates | Gross Billings, set forth as a percentage, based on the billing address of the clients or client affiliates, were as follows: Three Months Ended March 31, 2021 2020 U.S. 86 % 87 % International 14 % 13 % Total 100 % 100 % |
Subsequent Event (Tables)
Subsequent Event (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Summary of Basic EPS and Diluted EPS Calculations on Pro-Forma Basis | The following table summarizes the basic EPS and diluted EPS calculations on a pro-forma basis after giving retroactive effect to the ten-for-one split: Three Months Ended March 31, 2021 2020 Pro-forma Basic EPS $ 0.05 $ 0.05 Pro-forma Diluted EPS $ 0.05 $ 0.05 |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) - ASU 2019-12 | Mar. 31, 2021 |
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |
Change in accounting principle accounting standards update adopted | true |
Change in accounting principle accounting standards update adoption date | Mar. 31, 2021 |
Change in accounting principle accounting standards update immaterial effect | true |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) | Mar. 31, 2021Class |
Earnings Per Shares [Abstract] | |
Number of classes of common stock | 2 |
Earnings Per Share - Computatio
Earnings Per Share - Computation of Basic and Diluted EPS (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Numerator: | ||
Net income | $ 22,642 | $ 24,057 |
Denominator: | ||
Weighted-average shares outstanding—basic | 47,282 | 45,501 |
Effect of dilutive securities: | ||
Options to purchase common stock | 2,063 | 2,447 |
Employee stock purchase plan shares | 79 | 116 |
Restricted stock | 368 | 249 |
Weighted-average shares outstanding—diluted | 49,792 | 48,313 |
Basic EPS | $ 0.48 | $ 0.53 |
Diluted EPS | $ 0.45 | $ 0.50 |
Anti-dilutive equity awards under stock-based award plans excluded from the determination of diluted EPS | 26 | 388 |
Cash, Cash Equivalents and Sh_3
Cash, Cash Equivalents and Short -Term Investments - Schedule of Cash, Cash Equivalents and Short-term Investments in Marketable Securities (Detail) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | $ 471,637 | $ 437,353 |
Short-Term Investments | 208,446 | 186,685 |
Available For Sale | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | 471,637 | 437,353 |
Short-Term Investments | 208,446 | 186,685 |
Total | 680,083 | 624,038 |
Available For Sale | Cash | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | 163,241 | 132,372 |
Total | 163,241 | 132,372 |
Available For Sale | Level 1 | Money Market Funds | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | 265,790 | 259,434 |
Total | 265,790 | 259,434 |
Available For Sale | Level 2 | Commercial Paper | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | 36,969 | 45,547 |
Short-Term Investments | 97,698 | 63,372 |
Total | 134,667 | 108,919 |
Available For Sale | Level 2 | Corporate Debt Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Cash and cash equivalents | 5,637 | |
Short-Term Investments | 64,333 | 79,342 |
Total | 69,970 | 79,342 |
Available For Sale | Level 2 | U.S. Government and Agency Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Short-Term Investments | 46,415 | 43,971 |
Total | $ 46,415 | $ 43,971 |
Cash, Cash Equivalents and Sh_4
Cash, Cash Equivalents and Short - Schedule of Contractual Maturities of Short-Term Investments (Detail) $ in Thousands | Mar. 31, 2021USD ($) |
Available For Sale Securities Debt Maturities Fair Value [Abstract] | |
Due in one year | $ 184,621 |
Due in one to two years | 23,825 |
Total | $ 208,446 |
Leases - Summary of Components
Leases - Summary of Components of Lease Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Lease Cost [Abstract] | ||
Operating lease cost | $ 13,095 | $ 9,538 |
Short-term lease cost | 171 | 239 |
Variable lease cost | 1,923 | 811 |
Sublease income | (650) | (990) |
Total lease cost | $ 14,539 | $ 9,598 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | |
Long-term debt: | |||
Proceeds from line of credit | $ 143,000,000 | ||
Second A&R Credit Facility | |||
Long-term debt: | |||
Outstanding debt balance | $ 0 | ||
Proceeds from line of credit | $ 143,000,000 | ||
Availability under the credit facility | $ 143,600,000 | ||
Credit facility, maturity | May 9, 2022 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Stock-based compensation expense, by operating expense category | ||
Stock-based compensation expense | $ 52,354 | $ 22,965 |
Platform operations | ||
Stock-based compensation expense, by operating expense category | ||
Stock-based compensation expense | 5,015 | 1,462 |
Sales and marketing | ||
Stock-based compensation expense, by operating expense category | ||
Stock-based compensation expense | 13,684 | 5,314 |
Technology and development | ||
Stock-based compensation expense, by operating expense category | ||
Stock-based compensation expense | 16,094 | 8,590 |
General and administrative | ||
Stock-based compensation expense, by operating expense category | ||
Stock-based compensation expense | $ 17,561 | $ 7,599 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Option Activity (Detail) - Stock Options shares in Thousands | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Shares Under Option | |
Outstanding at the beginning of the period (in shares) | shares | 2,648 |
Granted (in shares) | shares | 3 |
Exercised (in shares) | shares | (179) |
Cancelled (in shares) | shares | (65) |
Outstanding at the end of the period (in shares) | shares | 2,407 |
Exercisable as of March 31, 2021 | shares | 1,374 |
Weighted-Average Exercise Price | |
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 107.26 |
Granted (in dollars per share) | $ / shares | 738.85 |
Exercised (in dollars per share) | $ / shares | 70.49 |
Cancelled (in dollars per share) | $ / shares | 154.39 |
Outstanding at the end of the period (in dollars per share) | $ / shares | 109.40 |
Exercisable as of March 31, 2021 | $ / shares | $ 65.09 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Options - Additional Information (Detail) shares in Millions | Jan. 01, 2021shares |
2016 Incentive Award Plan | |
Stock-Based Compensation | |
Number of additional shares authorized for grant | 1.9 |
Stock-Based Compensation - Su_2
Stock-Based Compensation - Summary of Restricted Stock Activity (Detail) shares in Thousands | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Unvested, RSU, beginning balance | shares | 570 |
Granted, RSU | shares | 22 |
Vested, RSU | shares | (53) |
Forfeited, RSU | shares | (27) |
Unvested, RSU, ending balance | shares | 512 |
Unvested, Weighted-Average Grant Date Fair Value Per Share, beginning balance | $ / shares | $ 261.03 |
Granted, Weighted-Average Grant Date Fair Value Per Share | $ / shares | 759.30 |
Vested, Weighted-Average Grant Date Fair Value Per Share | $ / shares | 178.88 |
Forfeited, Weighted-Average Grant Date Fair Value Per Share | $ / shares | 203.20 |
Unvested, Weighted-Average Grant Date Fair Value Per Share, ending balance | $ / shares | $ 294.24 |
Stock-Based Compensation - ESPP
Stock-Based Compensation - ESPP - Additional Information (Detail) - USD ($) $ in Thousands, shares in Millions | Jan. 01, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
Stock-Based Compensation | |||
Stock-based compensation expense | $ 52,354 | $ 22,965 | |
ESPP | |||
Stock-Based Compensation | |||
Stock-based compensation expense | $ 25,600 | $ 7,800 | |
Number of additional shares authorized for grant | 0.4 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | ||
Benefit from income taxes, benefits associated with stock-based awards | $ 25.9 | $ 24.3 |
Federal tax at statutory rate (as a percent) | 21.00% | 21.00% |
Geographic Information - Gross
Geographic Information - Gross Billings Percentage, Based on Billing Address of Clients or Client Affiliates (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Gross Billings | $ 100 | $ 100 |
U.S. | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Gross Billings | 86 | 87 |
International | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Gross Billings | $ 14 | $ 13 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Mar. 31, 2021USD ($) |
Indemnifications | |
Commitments and Contingencies | |
Recorded obligation | $ 0 |
Subsequent Event - Additional I
Subsequent Event - Additional Information (Details) shares in Millions | May 10, 2021 | Jun. 30, 2021shares |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Stock split ratio | 0.1 | |
Scenario Forecast | ||
Subsequent Event [Line Items] | ||
Common stock, shares outstanding | 475 |
Subsequent Event - Summary of B
Subsequent Event - Summary of Basic EPS and Diluted EPS Calculations on Pro-Forma Basis (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Subsequent Events [Abstract] | ||
Pro-forma Basic EPS | $ 0.05 | $ 0.05 |
Pro-forma Diluted EPS | $ 0.05 | $ 0.05 |