Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 21, 2023 | Jun. 30, 2022 | |
Document Information [Line Items] | |||
Document Type | 10-K/A | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38352 | ||
Entity Registrant Name | ADT Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 47-4116383 | ||
Entity Address, Address Line One | 1501 Yamato Road | ||
Entity Address, City or Town | Boca Raton | ||
Entity Address, State or Province | FL | ||
Entity Address, Postal Zip Code | 33431 | ||
City Area Code | (561) | ||
Local Phone Number | 988-3600 | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Trading Symbol | ADT | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 1,595 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive proxy statement for use in connection with its 2023 Annual Meeting of Shareholders, which was filed on April 11, 2023, are incorporated by reference into Part III of this Amended 2022 Annual Report on Form 10-K/A. | ||
Entity Central Index Key | 0001703056 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | true | ||
Amendment Description | EXPLANATORY NOTEThis Amendment No. 1 to our Annual Report on Form 10-K/A (“Form 10-K/A” or “Amended 2022 Annual Report”) amends and restates certain information included in our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 28, 2023 (the “Original 2022 Annual Report”).As previously announced in our Current Report on Form 8-K filed with the SEC on July 10, 2023, in connection with the preparation of our second quarter 2023 condensed consolidated financial statements, the Company (or “management”, “we”, “our”, “us”, or “ADT”) identified errors in the non-cash goodwill impairment losses associated with our Solar reporting unit and related tax impacts recognized during the third quarter of 2022 and the first quarter of 2023 as a result of the Company not applying the simultaneous equation method prescribed by Accounting Standards Update 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”). The simultaneous equation method is not universally applicable. It only applies when a reporting unit has tax deductible goodwill. When a reporting unit contains tax deductible goodwill, a goodwill impairment results in an increase in the related deferred tax asset (or reduction in deferred tax liability), which in turn, results in greater goodwill impairment. The simultaneous equation solves for the amount of goodwill impairment and related deferred taxes that yield a carrying amount of the reporting unit equal to its fair value at the point of impairment.As a result, goodwill impairment loss was understated, income tax expense was overstated/income tax benefit was understated and net income was overstated/net loss was understated in the Company’s statements of operations for the relevant periods, which had a corresponding impact on the related balance sheet items. There was no impact to the Company’s consolidated statement of cash flows except for the presentation of net income (loss) offset by the respective adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities. Additionally, there was no impact to the Company’s segment profit measure, compliance with debt covenants, or performance metrics used in the calculation of executive compensation as the impacted line items are excluded from these calculations.In addition, we identified a material weakness in our internal control over financial reporting (“ICFR”), and as such, we concluded our ICFR was not effective as of December 31, 2022, and our disclosure controls and procedures (“DCPs”) were not effective at a reasonable assurance level as of September 30, 2022, December 31, 2022, and March 31, 2023.On July 3, 2023, management, together with the Audit Committee of the Board of Directors of the Company (the “Audit Committee”), concluded that the following previously issued consolidated financial statements and other information of ADT Inc. (“ADT”) should no longer be relied upon:•the condensed consolidated financial statements as of and for the three and nine months ended September 30, 2022, included in our Quarterly Report on Form 10-Q filed with the SEC on November 3, 2022;•the consolidated financial statements as of and for the year ended December 31, 2022, included in our Original 2022 Annual Report;•the condensed consolidated financial statements as of and for the three months ended March 31, 2023, included in our Quarterly Report on Form 10-Q filed with the SEC on May 2, 2023; and•the amended information discussed herein that is contained in any previously issued or filed press releases, earnings releases, presentations, or other such documents including those posted on the Company’s website.Items Amended in this FilingThis Amended 2022 Annual Report sets forth our Original 2022 Annual Report, as amended, in its entirety. Except as required to reflect the restated amounts, related disclosures, and updates to our assessment of ICFR and DCPs, there were no changes to any other parts of the Original 2022 Annual Report, and this Amended 2022 Annual Report does not reflect events occurring after the date of the Original 2022 Annual Report. Unless otherwise noted, references herein such as “as of the date of this Annual Report” refer to February 28, 2023, the original filing date of the Original 2022 Annual Report.The following sections have been amended in this Amended 2022 Annual Report:•Cautionary Statements Regarding Forward-Looking Statements•Part I, Item 1A, Risk Factors•Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations•Part II, Item 8, Financial Statements and Supplementary Data•Part II, Item 9A, Controls and Procedures•Part IV, Item 15, Exhibit and Financial Statement SchedulesThe exhibit list included in Item 15, “Exhibit and Financial Statement Schedules” herein has been amended to contain currently dated certifications from the Company’s Chief Executive Officer and Chief Financial Officer, as required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 and filed as Exhibits 31.1/31.2 and 32.1/32.2, respectively, as well as an updated Consent of Independent Registered Public Accounting Firm filed as Exhibit 23.In accordance with applicable SEC rules, this Form 10-K/A also includes an updated signature page and Report of Independent Registered Public Accounting Firm.Except as relating to the identified errors and the restatement described above, discussions within Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other forward-looking statements made in our Original 2022 Annual Report have not been revised in this Amended 2022 Annual Report to reflect events that occurred at a later date or facts that subsequently became known to the Company and should be read in their historical context.Refer to Note 1 “Description of Business and Summary of Significant Accounting Policies” and Note 6 “Goodwill and Other Intangible Assets” in the Notes to Consolidated Financial Statements on this Form 10-K/A for additional information. | ||
Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 862,300,080 | ||
Class B Common Stock | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 54,744,525 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Auditor Information [Abstract] | |
Auditor name | PricewaterhouseCoopers LLP |
Auditor location | Hallandale Beach, Florida |
Auditor firm ID | 238 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 257,223 | $ 24,453 |
Restricted cash and restricted cash equivalents | 116,357 | 8,824 |
Accounts receivable, net of allowance for credit losses of $65,655 and $54,032, respectively | 597,313 | 442,158 |
Inventories, net | 329,490 | 277,323 |
Work-in-progress | 80,765 | 70,528 |
Prepaid expenses and other current assets | 340,848 | 169,245 |
Total current assets | 1,721,996 | 992,531 |
Property and equipment, net | 375,968 | 364,108 |
Subscriber system assets, net | 3,061,303 | 2,867,528 |
Intangible assets, net | 5,091,747 | 5,413,351 |
Goodwill | 5,767,016 | 5,943,403 |
Deferred subscriber acquisition costs, net | 1,079,638 | 850,489 |
Other assets | 723,568 | 462,941 |
Total assets | 17,821,236 | 16,894,351 |
Current liabilities: | ||
Current maturities of long-term debt | 871,917 | 117,592 |
Accounts payable | 486,715 | 474,976 |
Deferred revenue | 402,691 | 373,532 |
Accrued expenses and other current liabilities | 899,780 | 737,245 |
Total current liabilities | 2,661,103 | 1,703,345 |
Long-term debt | 8,956,671 | 9,575,098 |
Deferred subscriber acquisition revenue | 1,645,478 | 1,199,293 |
Deferred tax liabilities | 892,994 | 867,203 |
Other liabilities | 271,842 | 300,693 |
Total liabilities | 14,428,088 | 13,645,632 |
Commitments and contingencies (See Note 13) | ||
Stockholders' equity: | ||
Preferred stock—authorized 1,000,000 shares of $0.01 par value; zero issued and outstanding as of December 31, 2022 and 2021. | 0 | 0 |
Additional paid-in capital | 7,380,759 | 7,261,267 |
Accumulated deficit | (3,949,579) | (3,952,590) |
Accumulated other comprehensive income (loss) | (47,200) | (68,973) |
Total stockholders' equity | 3,393,148 | 3,248,719 |
Total liabilities and stockholders' equity | 17,821,236 | 16,894,351 |
Common Stock | ||
Stockholders' equity: | ||
Common stock—authorized 3,999,000,000 shares of $0.01 par value; issued and outstanding shares of 862,098,041 and 846,825,868 as of December 31, 2022 and 2021, respectively. | 8,621 | 8,468 |
Class B common stock—authorized 100,000,000 shares of $0.01 par value; issued and outstanding shares of 54,744,525 as of December 31, 2022 and 2021. | 8,621 | 8,468 |
Class B Common Stock | ||
Stockholders' equity: | ||
Common stock—authorized 3,999,000,000 shares of $0.01 par value; issued and outstanding shares of 862,098,041 and 846,825,868 as of December 31, 2022 and 2021, respectively. | 547 | 547 |
Class B common stock—authorized 100,000,000 shares of $0.01 par value; issued and outstanding shares of 54,744,525 as of December 31, 2022 and 2021. | $ 547 | $ 547 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounts receivable, allowance for credit loss, current | $ 65,655 | $ 54,032 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common Stock | ||
Common stock, shares authorized (in shares) | 3,999,000,000 | 3,999,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued (in shares) | 862,098,041 | 846,825,868 |
Common stock, shares outstanding (in shares) | 862,098,041 | 846,825,868 |
Class B Common Stock | ||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares issued (in shares) | 54,744,525 | 54,744,525 |
Common stock, shares outstanding (in shares) | 54,744,525 | 54,744,525 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue from contract with customer, excluding assessed tax | $ 6,395,310 | $ 5,307,111 | $ 5,314,787 |
Total cost of revenue | 2,039,848 | 1,550,173 | 1,516,528 |
Selling, general, and administrative expenses | 1,930,021 | 1,789,009 | 1,723,644 |
Depreciation and intangible asset amortization | 1,693,575 | 1,914,779 | 1,913,767 |
Merger, restructuring, integration, and other | 22,232 | 37,872 | 120,208 |
Goodwill impairment | 200,974 | 0 | 0 |
Operating income (loss) | 508,660 | 15,278 | 40,640 |
Interest expense, net | (265,285) | (457,667) | (708,189) |
Loss on extinguishment of debt | 0 | (37,113) | (119,663) |
Other income (expense) | (57,561) | 8,313 | 8,293 |
Income (loss) before income taxes and equity in net earnings (losses) of equity method investee | 185,814 | (471,189) | (778,919) |
Income tax benefit (expense) | (48,550) | 130,369 | 146,726 |
Income (loss) before equity in net earnings (losses) of equity method investee | 137,264 | (340,820) | (632,193) |
Equity in net earnings (losses) of equity method investee | (4,601) | 0 | 0 |
Net income (loss) | $ 132,663 | $ (340,820) | $ (632,193) |
Common Stock | |||
Net income (loss) per share - basic: | |||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Weighted-average shares outstanding - basic: | |||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 848,465 | 770,620 | 760,483 |
Net income (loss) per share - diluted: | |||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Weighted-average shares outstanding - diluted: | |||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 915,068 | 770,620 | 760,483 |
Class B Common Stock | |||
Net income (loss) per share - basic: | |||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.72) |
Weighted-average shares outstanding - basic: | |||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 54,745 | 54,745 | 15,855 |
Net income (loss) per share - diluted: | |||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.74) |
Weighted-average shares outstanding - diluted: | |||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 54,745 | 54,745 | 17,944 |
Monitoring and related services | |||
Revenue from contract with customer, excluding assessed tax | $ 4,589,265 | $ 4,347,713 | $ 4,186,987 |
Total cost of revenue | 918,048 | 912,948 | 789,906 |
Security installation, product, and other | |||
Revenue from contract with customer, excluding assessed tax | 1,019,619 | 912,047 | 1,127,800 |
Total cost of revenue | 620,090 | 602,467 | 726,622 |
Solar installation, product, and other | |||
Revenue from contract with customer, excluding assessed tax | 786,426 | 47,351 | 0 |
Total cost of revenue | $ 501,710 | $ 34,758 | $ 0 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net income (loss) | $ 132,663 | $ (340,820) | $ (632,193) |
Other comprehensive income (loss), net of tax: | |||
Cash flow hedges | 25,754 | 46,234 | (58,114) |
Other | (3,981) | 3,408 | (2,125) |
Total other comprehensive income (loss), net of tax | 21,773 | 49,642 | (60,239) |
Comprehensive income (loss) | $ 154,436 | $ (291,178) | $ (692,432) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Class B Common Stock | Common Stock Common Stock | Common Stock Class B Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Deficit Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Income (Loss) |
Beginning balance (in shares) at Dec. 31, 2019 | 753,622,000 | |||||||||
Beginning balance at Dec. 31, 2019 | $ 3,184,369 | $ (2,341) | $ 7,536 | $ 5,977,402 | $ (2,742,193) | $ (2,341) | $ (58,376) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income (loss) | (632,193) | (632,193) | ||||||||
Other comprehensive income (loss), net of tax | (60,239) | (60,239) | ||||||||
Issuance of common stock, net of expenses (in shares) | 16,279,000 | 54,745,000 | ||||||||
Issuance of common stock, net of expenses | 561,581 | $ 163 | $ 547 | 560,871 | ||||||
Repurchases of common stock (in shares) | (1,000) | |||||||||
Repurchases of common stock | (4) | (4) | ||||||||
Dividends, including dividends reinvested in common stock (in shares) | 2,000 | |||||||||
Dividends, including dividends reinvested in common stock | (111,853) | (15) | (111,868) | |||||||
Share-based compensation expense | 96,013 | 96,013 | ||||||||
Contingent forward purchase contract | 0 | |||||||||
Transactions related to employee share-based compensation plans and other (in shares) | 1,112,000 | |||||||||
Transactions related to employee share-based compensation plans and other | 4,003 | $ 11 | 6,466 | (2,474) | ||||||
Ending balance (in shares) at Dec. 31, 2020 | 771,014,000 | 54,745,000 | ||||||||
Ending balance at Dec. 31, 2020 | 3,039,336 | $ 7,710 | $ 547 | 6,640,763 | (3,491,069) | (118,615) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income (loss) | (340,820) | (340,820) | ||||||||
Other comprehensive income (loss), net of tax | 49,642 | 49,642 | ||||||||
Issuance of common stock, net of expenses (in shares) | 69,667,000 | |||||||||
Issuance of common stock, net of expenses | 568,609 | $ 697 | 567,912 | |||||||
Dividends, including dividends reinvested in common stock | (119,150) | (4) | (119,154) | |||||||
Share-based compensation expense | 61,237 | 61,237 | ||||||||
Contingent forward purchase contract | 0 | |||||||||
Transactions related to employee share-based compensation plans and other (in shares) | 6,145,000 | |||||||||
Transactions related to employee share-based compensation plans and other | (10,135) | $ 61 | (8,649) | (1,547) | ||||||
Ending balance (in shares) at Dec. 31, 2021 | 846,825,868 | 54,744,525 | 846,826,000 | 54,745,000 | ||||||
Ending balance at Dec. 31, 2021 | 3,248,719 | $ 8,468 | $ 547 | 7,261,267 | (3,952,590) | (68,973) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income (loss) | 132,663 | 132,663 | ||||||||
Other comprehensive income (loss), net of tax | 21,773 | 21,773 | ||||||||
Issuance of common stock, net of expenses (in shares) | 140,681,000 | |||||||||
Issuance of common stock, net of expenses | 1,189,895 | $ 1,407 | 1,188,488 | |||||||
Repurchases of common stock (in shares) | (133,333,000) | |||||||||
Repurchases of common stock | (1,094,667) | $ (1,333) | (1,093,334) | |||||||
Dividends | (127,835) | (127,835) | ||||||||
Share-based compensation expense | 66,566 | 66,566 | ||||||||
Contingent forward purchase contract | (41,938) | (41,938) | ||||||||
Transactions related to employee share-based compensation plans and other (in shares) | 7,924,000 | |||||||||
Transactions related to employee share-based compensation plans and other | (2,028) | $ 79 | (290) | (1,817) | ||||||
Ending balance (in shares) at Dec. 31, 2022 | 862,098,041 | 54,744,525 | 862,098,000 | 54,745,000 | ||||||
Ending balance at Dec. 31, 2022 | $ 3,393,148 | $ 8,621 | $ 547 | $ 7,380,759 | $ (3,949,579) | $ (47,200) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Cash Flows [Abstract] | |||
Net income (loss) | $ 132,663 | $ (340,820) | $ (632,193) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation and intangible asset amortization | 1,693,575 | 1,914,779 | 1,913,767 |
Amortization of deferred subscriber acquisition costs | 162,981 | 126,089 | 96,823 |
Amortization of deferred subscriber acquisition revenue | (244,141) | (172,061) | (124,804) |
Share-based compensation expense | 66,566 | 61,237 | 96,013 |
Deferred income taxes | 19,575 | (139,480) | (173,415) |
Provision for losses on receivables and inventory | 113,869 | 38,213 | 119,677 |
Loss on extinguishment of debt | 0 | 37,113 | 119,663 |
Goodwill, intangible, and other asset impairments | 206,132 | 19,161 | 0 |
Unrealized (gain) loss on interest rate swap contracts | (301,851) | (157,505) | 60,363 |
Change in fair value of other financial instruments | (63,396) | 0 | 0 |
Other non-cash items, net | 124,460 | 149,024 | 145,272 |
Changes in operating assets and liabilities, net of effects of acquisitions and dispositions: | |||
Accounts receivable, net | (178,258) | (50,214) | (84,050) |
Contract assets, net | 36,807 | 46,788 | (140,920) |
Inventories and work-in-progress | (67,391) | (84,020) | (60,797) |
Accounts payable | 8,662 | 98,123 | 65,317 |
Deferred subscriber acquisition costs | (393,861) | (323,602) | (239,838) |
Deferred subscriber acquisition revenue | 329,214 | 276,841 | 179,874 |
Long-term retail installment contracts | 142,811 | 64,516 | (7,479) |
Other, net | (27,289) | 85,541 | 33,476 |
Net cash provided by (used in) operating activities | 1,887,920 | 1,649,723 | 1,366,749 |
Cash flows from investing activities: | |||
Dealer generated customer accounts and bulk account purchases | (621,695) | (675,118) | (380,716) |
Subscriber system asset expenditures | (734,639) | (694,684) | (418,355) |
Purchases of property and equipment | (176,660) | (168,238) | (157,191) |
Acquisition of businesses, net of cash acquired | (13,095) | (163,503) | (224,617) |
Sale of business, net of cash sold | 26,749 | 1,807 | (2,448) |
Other investing, net | (13,444) | 3,991 | 45,850 |
Net cash provided by (used in) investing activities | (1,532,784) | (1,695,745) | (1,137,477) |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock, net of expenses | 1,180,000 | 0 | 447,811 |
Proceeds from long-term borrowings | 550,035 | 1,195,729 | 2,640,000 |
Proceeds from receivables facility | 276,826 | 253,546 | 82,517 |
Proceeds from opportunity fund | 100,802 | ||
Repurchases of common stock | (1,200,000) | 0 | (4) |
Repayment of long-term borrowings, including call premiums | (605,059) | (1,219,070) | (3,026,842) |
Repayment of receivables facility | (121,061) | (130,345) | (6,742) |
Dividends on common stock | (127,125) | (116,348) | (109,328) |
Payments on finance leases | (44,978) | (32,123) | (27,956) |
Payments on interest rate swaps | (18,841) | (56,119) | (38,325) |
Other financing, net | (5,432) | (23,718) | (31,392) |
Net cash provided by (used in) financing activities | (14,833) | (128,448) | (70,261) |
Cash and cash equivalents and restricted cash and restricted cash equivalents: | |||
Net increase (decrease) during the period | 340,303 | (174,470) | 159,011 |
Beginning balance | 33,277 | 207,747 | 48,736 |
Ending balance | $ 373,580 | $ 33,277 | $ 207,747 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Description of Business and Summary of Significant Accounting Policies | DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business and Organization ADT Inc., together with its wholly-owned subsidiaries (collectively, the “Company”), is a leading provider of security, interactive, and smart home solutions serving consumer, small business, and commercial customers in the United States (“U.S.”). Since the acquisition of ADT Solar (the “ADT Solar Acquisition”) in December 2021, the Company also provides residential solar and energy storage solutions. The Company primarily conducts business under the ADT brand name. ADT Inc. was incorporated in the State of Delaware in May 2015 as a holding company with no assets or liabilities. In July 2015, the Company acquired Protection One, Inc. and ASG Intermediate Holding Corp. (collectively, the “Formation Transactions”), which were instrumental in the commencement of the Company’s operations. In May 2016, the Company acquired The ADT Security Corporation (formerly named The ADT Corporation) (“The ADT Corporation”) (the “ADT Acquisition”). The Company is majority-owned by Prime Security Services TopCo (ML), L.P., which is majority-owned by Prime Security Services TopCo Parent, L.P. (“Ultimate Parent”). Ultimate Parent is majority-owned by Apollo Investment Fund VIII, L.P. and its related funds that are directly or indirectly managed by affiliates of Apollo Global Management, Inc. (together with its subsidiaries and affiliates, “Apollo” or the “Sponsor”). In January 2018, the Company completed an initial public offering (“IPO”) and its common stock, par value of $0.01 per share (“Common Stock”), began trading on the New York Stock Exchange under the symbol “ADT.” Basis of Presentation The consolidated financial statements have been prepared in U.S. dollars in accordance with generally accepted accounting principles in the United States of America (“GAAP”). Certain prior period amounts have been reclassified to conform with the current period presentation. The financial statements included herein comprise the consolidated results of ADT Inc. and its wholly-owned subsidiaries. The results of companies acquired are included from the effective date of each acquisition; and all intercompany transactions have been eliminated. The Company uses the equity method of accounting to account for an investment in which it has the ability to exercise significant influence but does not control. Restatement The Company restated its previously issued Consolidated Financial Statements and related notes for the year ended December 31, 2022. In connection with the preparation of the Company’s second quarter 2023 condensed consolidated financial statements, the Company identified errors in the non-cash goodwill impairment losses associated with its Solar reporting unit and related tax impacts recognized during the third quarter of 2022 and the first quarter of 2023 as a result of the Company not applying the simultaneous equation method prescribed by Accounting Standards Update 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”). The simultaneous equation method is not universally applicable. It only applies when a reporting unit has tax deductible goodwill. When a reporting unit contains tax deductible goodwill, a goodwill impairment results in an increase in the related deferred tax asset (or reduction in deferred tax liability), which in turn, results in greater goodwill impairment. The simultaneous equation solves for the amount of goodwill impairment and related deferred taxes that yield a carrying amount of the reporting unit equal to its fair value at the point of impairment. The impacts from the restatement as of and for the year ended December 31, 2022 are as follows: Consolidated Balance Sheet: December 31, 2022 (in thousands) As Reported Adjustments As Restated Goodwill $ 5,818,605 $ (51,589) $ 5,767,016 Total assets $ 17,872,825 $ (51,589) $ 17,821,236 Deferred tax liabilities $ 904,628 $ (11,634) $ 892,994 Total liabilities $ 14,439,722 $ (11,634) $ 14,428,088 Accumulated deficit $ (3,909,624) $ (39,955) $ (3,949,579) Total stockholders' equity $ 3,433,103 $ (39,955) $ 3,393,148 Total liabilities and stockholders' equity $ 17,872,825 $ (51,589) $ 17,821,236 Consolidated Statement of Operations: Year Ended December 31, 2022 (in thousands, except per share amounts) As Reported Adjustments As Restated Goodwill impairment $ 149,385 $ 51,589 $ 200,974 Operating income (loss) $ 560,249 $ (51,589) $ 508,660 Income (loss) before income taxes and equity in net earnings (losses) of equity method investee $ 237,403 $ (51,589) $ 185,814 Income tax benefit (expense) $ (60,184) $ 11,634 $ (48,550) Income (loss) before equity in net earnings (losses) of equity method investee $ 177,219 $ (39,955) $ 137,264 Net income (loss) $ 172,618 $ (39,955) $ 132,663 Net income (loss) per share - basic: Common Stock $ 0.19 $ (0.04) $ 0.15 Class B Common Stock $ 0.19 $ (0.04) $ 0.15 Weighted-average shares outstanding - basic: Common Stock 848,465 — 848,465 Class B Common Stock 54,745 — 54,745 Net income (loss) per share - diluted: Common Stock $ 0.19 $ (0.04) $ 0.15 Class B Common Stock $ 0.19 $ (0.04) $ 0.15 Weighted-average shares outstanding - diluted: Common Stock 915,068 — 915,068 Class B Common Stock 54,745 — 54,745 Consolidated Statement of Comprehensive Income (Loss): Year Ended December 31, 2022 (in thousands) As Reported Adjustments As Restated Net income (loss) $ 172,618 $ (39,955) $ 132,663 Comprehensive income (loss) $ 194,391 $ (39,955) $ 154,436 Consolidated Statement of Stockholders’ Equity: Year Ended December 31, 2022 (in thousands) As Reported Adjustments As Restated Net income (loss) $ 172,618 $ (39,955) $ 132,663 Accumulated deficit $ (3,909,624) $ (39,955) $ (3,949,579) Total stockholders’ equity $ 3,433,103 $ (39,955) $ 3,393,148 Consolidated Statement of Cash Flows: Year Ended December 31, 2022 (in thousands) As Reported Adjustments As Restated Net income (loss) $ 172,618 $ (39,955) $ 132,663 Deferred income taxes $ 31,209 $ (11,634) $ 19,575 Goodwill, intangible, and other asset impairments $ 154,543 $ 51,589 $ 206,132 In addition, the following footnotes have been updated to reflect the impact of the restatement: • Note 1 “Description of Business and Summary of Significant Accounting Policies” • Note 3 “ Segment Information ” • Note 6 “ Goodwill and Other Intangible Assets ” • Note 9 “ Income Taxes ” • Note 12 “ Net Income (Loss) per Share ” • Note 17 “ Condensed Financial Information of Registrant ” Use of Estimates The preparation of the consolidated financial statements in accordance with GAAP requires the Company to select accounting policies and make estimates that affect amounts reported in the consolidated financial statements and the accompanying notes. The Company’s estimates are based on the relevant information available at the end of each period. Actual results could differ materially from these estimates under different assumptions or market conditions. The Company considered the on-going and pervasive economic impact of the coronavirus pandemic (the “COVID-19 Pandemic”) in the assessment of its financial position, results of operations, and cash flows, as well as certain accounting estimates, for the periods presented. The impact of the COVID-19 Pandemic was not material during the periods presented. However, the evolving and uncertain nature of the COVID-19 Pandemic, and its economic impact, as well as the evolving nature of the regulatory environment, could materially impact the Company’s estimates and financial results in future reporting periods. Segments The Company has three operating and reportable segments organized based on customer type: Consumer and Small Business (“CSB”), Commercial, and Solar. The Company’s segments are based on the manner in which the Company’s Chief Executive Officer, who is the chief operating decision maker (the “CODM”), evaluates performance and makes decisions about how to allocate resources. • CSB - The CSB segment primarily includes the sale, installation, servicing, and monitoring of integrated security and automation systems and other related offerings to owners and renters of residential properties, small business operators, and other individual consumers, as well as general corporate costs and other income and expense items not included in another segment. • Commercial - The Commercial segment primarily includes the sale, installation, servicing, and monitoring of integrated security and automation systems, fire detection and suppression systems, and other related offerings to larger businesses and/or multi-site operations, which often require more sophisticated integrated solutions, as well as certain dedicated corporate and other costs. • Solar - The Solar segment primarily includes the sale and installation of solar systems and related solutions and services to residential homeowners who purchase solar and energy storage solutions, energy efficiency upgrades, and roofing services, as well as certain dedicated corporate and other costs. Refer to Note 3 “Segment Information” for additional information on the Company’s segments. Accounting Pronouncements Recently Adopted Accounting Pronouncements Reference Rate Reform - Financial Accounting Standards Board Accounting Standards Update (“ASU”) 2022-06 , Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, defers the sunset date of ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , from December 31, 2022 to December 31, 2024. These updates provide optional guidance for a limited period of time to ease the potential burden of accounting for reference rate reform. This guidance was effective upon issuance and did not have a material impact on the consolidated financial statements as of December 31, 2022. The Company will continue to evaluate this guidance. Other Accounting Pronouncements Vintage Disclosures for Financing Receivables - ASU 2022-02, Financial Instruments — Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures , requires reporting entities to disclose current-period gross write-offs by year of origination for financing receivables, among other requirements. This disclosure-only guidance is effective in the first quarter of 2023, and the Company will apply the guidance prospectively. Fair Value of Equity Investments - ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, states that an entity should not consider the contractual sale restriction when measuring the equity security’s fair value and introduces new disclosure requirements related to such equity securities. This guidance becomes effective January 1, 2024, and should be applied prospectively with any adjustments recognized in earnings and disclosed on the date of adoption. Early adoption is permitted. The Company is currently evaluating this guidance. Supplier Finance Program Obligations - ASU 2022-04, Liabilities — Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, requires that a reporting entity who is a buyer in a supplier finance program disclose qualitative and quantitative information about its supplier finance programs, including a roll-forward of the obligations. This guidance is effective in the first quarter of 2023, and should be applied retrospectively, except for the amendment on roll-forward information, which becomes effective January 1, 2024 (early adoption is permitted), and should be applied prospectively. The Company is currently evaluating the impact of this guidance on its disclosures. Significant Accounting Policies Information on select accounting policies and methods not discussed below are included in the respective footnotes that follow. Cash and Cash Equivalents and Restricted Cash and Restricted Cash Equivalents All highly liquid investments with original maturities of three months or less from the time of purchase are considered to be cash equivalents. Restricted cash and restricted cash equivalents are restricted for a specific purpose and cannot be included in the general cash and cash equivalents account. The following table reconciles the amounts below reported in the Consolidated Balance Sheets to the total of the same such amounts shown in the Consolidated Statements of Cash Flows: Years Ended December 31, (in thousands) 2022 2021 2020 Cash and cash equivalents $ 257,223 $ 24,453 $ 204,998 Restricted cash and restricted cash equivalents 116,357 8,824 2,749 Ending balance $ 373,580 $ 33,277 $ 207,747 Included in restricted cash and restricted cash equivalents are funds received from State Farm Fire & Casualty Company (“State Farm”) of $101 million (the “Opportunity Fund”), including accrued interest, in connection with the State Farm Strategic Investment (as defined and discussed in Note 10 “Equity”). Amounts within the Opportunity Fund are restricted for certain qualifying spend in accordance with the development agreement between State Farm and the Company (the “State Farm Development Agreement”). Use of the funds must be agreed to by State Farm and the Company, and as of December 31, 2022, the Company has not used any funds. Supplementary Cash Flow Information The following table summarizes supplementary cash flow information and material non-cash investing and financing transactions, excluding leases (refer to Note 14 “Leases”): Years Ended December 31, (in thousands) 2022 2021 2020 Interest paid, net of interest income received (1) $ 452,105 $ 456,509 $ 510,185 Payments (refunds) on income taxes, net $ 22,654 $ 1,877 $ 25,802 Issuance of shares for acquisition of businesses (2) $ 55,485 $ 528,503 $ 113,841 Contingent forward purchase contract (3) $ 41,938 $ — $ — ___________________ (1) Excludes interest on interest rate swaps presented within financing activities. Refer to Note 8 “Derivative Financial Instruments.” (2) During 2022, includes $40 million related to the Delayed Shares (as defined in Note 4 “Acquisitions and Disposition”) as a result of the ADT Solar Acquisition. During 2021 and 2020, relates to the ADT Solar Acquisition and the Defenders Acquisition, respectively (both as defined and discussed in Note 4 “Acquisitions and Disposition”). (3) During 2022, the Company recorded a reduction to additional paid in capital as a result of the contingent forward purchase contract in connection with the Tender Offer (as defined and discussed in Note 10 “Equity”). Prepaid Expenses and Other Current Assets December 31, (in thousands) 2022 2021 Prepaid expenses $ 28,648 $ 30,373 Contract assets (see Note 2 "Revenue and Receivables") 33,632 58,452 Fair value of interest rate swaps (see Note 8 "Derivative Financial Instruments") 78,110 — Other receivables (1) 122,476 23,211 Other current assets 77,982 57,209 Prepaid expenses and other current assets $ 340,848 $ 169,245 ___________________ (1) As of December 31, 2022, the Company recorded a liability of approximately $88 million, which is reflected in accrued expenses and other current liabilities and which relates to certain loans provided to customers within the Solar business that the Company may be required to repurchase from the third party lenders. Included in other receivables is the amount that the Company expects to recover if permission to operate is achieved in the event the third party lenders do require the Company to repurchase such loans. Inventories, net Inventories are primarily comprised of components and parts for the Company’s security and solar systems. The Company records inventory at the lower of cost and net realizable value. Inventories are presented net of an obsolescence reserve. Work-in-Progress Work-in-progress is primarily comprised of certain costs incurred for installations of security system equipment sold outright to customers that have not yet been completed. Property and Equipment, net Property and equipment, net, is recorded at historical cost less accumulated depreciation, which is calculated using the straight-line method over the estimated useful lives of the related assets. Depreciation expense is reflected in depreciation and intangible asset amortization. Repairs and maintenance expenditures are expensed when incurred. Useful Lives: Buildings and related improvements Up to 40 years Leasehold improvements Lesser of remaining term of the lease or economic useful life Capitalized software 3 to 10 years Machinery, equipment, and other Up to 10 years Net Carrying Amount: December 31, (in thousands) 2022 2021 Land $ 13,052 $ 13,120 Buildings and leasehold improvements 115,887 112,475 Capitalized software 560,581 491,184 Machinery, equipment, and other 205,828 205,696 Construction in progress 16,426 26,335 Finance leases 199,487 166,925 Accumulated depreciation (735,293) (651,627) Property and equipment, net $ 375,968 $ 364,108 Depreciation Expense: Years Ended December 31, (in thousands) 2022 2021 2020 Depreciation expense $ 206,709 $ 197,202 $ 187,386 Subscriber System Assets, net and Deferred Subscriber Acquisition Costs, net Subscriber system assets represent capitalized equipment and installation costs incurred in connection with transactions in which the Company retains ownership of the security system and are reflected in the Consolidated Balance Sheets as follows: December 31, (in thousands) 2022 2021 Gross carrying amount $ 6,205,762 $ 5,499,703 Accumulated depreciation (3,144,459) (2,632,175) Subscriber system assets, net $ 3,061,303 $ 2,867,528 Deferred subscriber acquisition costs represent selling expenses (primarily commissions) that are incremental to acquiring customers. The Company records subscriber system assets and deferred subscriber acquisition costs in the Consolidated Balance Sheets as these assets represent a probable future economic benefit for the Company through the generation of future monitoring and related services revenue. Upon customer termination, the Company may retrieve such assets. Subscriber system assets and any related deferred subscriber acquisition costs are accounted for on a pooled basis based on the month and year of customer acquisition and are depreciated and amortized using an accelerated method over the estimated life of the customer relationship, which is 15 years. In order to align the depreciation and amortization of these pooled costs to the pattern in which their economic benefits are consumed, the accelerated method utilizes an average declining balance rate of approximately 250% and converts to straight-line methodology when the resulting charge is greater than that from the accelerated method, resulting in an average charge of approximately 55% of the pool within the first five years, 25% within the second five years, and 20% within the final five years. Depreciation of subscriber system assets and amortization of deferred subscriber acquisition costs are reflected in depreciation and intangible asset amortization and selling, general, and administrative expenses, respectively, as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Depreciation of subscriber system assets $ 551,260 $ 506,568 $ 501,669 Amortization of deferred subscriber acquisition costs $ 162,981 $ 126,089 $ 96,823 Long-Lived Assets (excluding Goodwill and Other Indefinite-Lived Intangible Assets) The Company reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset or asset group may not be fully recoverable. The Company groups assets at the lowest level for which cash flows are separately identified. Recoverability is measured by a comparison of the carrying amount of the asset group to its expected future undiscounted cash flows. If the expected future undiscounted cash flows of the asset group are less than its carrying amount, an impairment loss is recognized based on the amount by which the carrying amount exceeds the fair value less costs to sell. The calculation of the fair value less costs to sell of an asset group is based on assumptions concerning the amount and timing of estimated future cash flows and assumed discount rates, reflecting varying degrees of perceived risk. There were no material long-lived asset impairments during the periods presented. Accrued Expenses and Other Current Liabilities December 31, (in thousands) 2022 2021 Accrued interest $ 156,495 $ 124,579 Payroll-related accruals 208,111 196,165 Operating lease liabilities (see Note 14 "Leases") 28,696 37,359 Fair value of interest rate swaps (see Note 8 "Derivative Financial Instruments") — 50,360 Opportunity Fund (see Note 10 "Equity") 100,802 — Other accrued liabilities 405,676 328,782 Accrued expenses and other current liabilities $ 899,780 $ 737,245 Advertising Costs Advertising costs are expensed when incurred. Advertising costs included in selling, general, and administrative expenses were $219 million, $239 million, and $264 million during 2022, 2021, and 2020, respectively. Radio Conversion Program During 2019, the Company commenced a program to replace the 3G and Code-Division Multiple Access (“CDMA”) cellular equipment used in many of its security systems prior to the cellular network providers retiring their 3G and CDMA networks during 2022. From inception of this program through December 31, 2022, the Company incurred $292 million of net radio conversion costs. The estimated remaining radio conversion costs and related incremental revenue are not expected to be material. Radio conversion costs and radio conversion revenue are reflected in selling, general, and administrative expenses and monitoring and related services revenue, respectively, as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Radio conversion costs $ 31,428 $ 250,490 $ 88,709 Radio conversion revenue $ 28,075 $ 39,127 $ 36,820 Merger, Restructuring, Integration, and Other Merger, restructuring, integration, and other represents certain direct and incremental costs resulting from acquisitions made by the Company, integration costs as a result of those acquisitions, costs related to the Company’s restructuring efforts, as well as fair value remeasurements and impairment charges on certain strategic investments. Concentration of Credit Risks The majority of the Company’s cash and cash equivalents and restricted cash and restricted cash equivalents are held at major financial institutions. There is a concentration of credit risk related to certain account balances in excess of the Federal Deposit Insurance Corporation insurance limit of $250,000 per account. The Company regularly monitors the financial stability of these financial institutions and believes there is no exposure to any significant credit risk for its cash and cash equivalents and restricted cash and restricted cash equivalents. Concentration of credit risk associated with the majority of the Company’s receivables from customers is limited due to the significant size of the customer base. Fair Value of Financial Instruments The Company’s financial instruments primarily consist of cash and cash equivalents, restricted cash and restricted cash equivalents, accounts receivable, retail installment contract receivables, accounts payable, debt, and derivative financial instruments. Due to their short-term and/or liquid nature, the fair values of cash, restricted cash, accounts receivable, and accounts payable approximate their respective carrying amounts. Cash Equivalents - Included in cash and cash equivalents and restricted cash and restricted cash equivalents, as applicable from time to time, are investments in money market mutual funds. These investments are generally classified as Level 1 fair value measurements, which represent unadjusted quoted prices in active markets for identical assets or liabilities. Investments in money market mutual funds were $145 million as of December 31, 2022, and were not material as of December 31, 2021. Retail Installment Contract Receivables, net - The fair values of the Company’s retail installment contract receivables are determined using a discounted cash flow model and are classified as Level 3 fair value measurements. December 31, 2022 2021 (in thousands) Carrying Fair Carrying Fair Retail installment contract receivables, net $ 531,516 $ 385,114 $ 330,605 $ 255,147 Long-Term Debt Instruments - The fair values of the Company’s debt instruments are determined using broker-quoted market prices, which represent quoted prices for similar assets or liabilities as well as other observable market data, and are classified as Level 2 fair value measurements. The carrying amounts of debt outstanding, if any, under the Company’s first lien revolving credit facility (the “First Lien Revolving Credit Facility”) and its uncommitted receivables securitization financing agreement (the “Receivables Facility”) approximate their fair values, as interest rates on these borrowings approximate current market rates. December 31, 2022 2021 (in thousands) Carrying Fair Carrying Fair Long-term debt instruments, excluding finance lease obligations, subject to fair value disclosures $ 9,733,700 $ 9,312,932 $ 9,599,610 $ 10,043,877 Derivative Financial Instruments - Derivative financial instruments are reported at fair value as either assets or liabilities. These fair values are primarily calculated using discounted cash flow models utilizing observable inputs, such as quoted forward interest rates, and incorporate credit risk adjustments to reflect the risk of default by the counterparty or the Company. The resulting fair values are classified as Level 2 fair value measurements. Refer to Note 8 “Derivative Financial Instruments” for the fair values of the Company’s derivative financial instruments. |
Revenue and Receivables
Revenue and Receivables | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue and Receivables | REVENUE AND RECEIVABLES Revenue The Company generates revenue through contractual monthly recurring fees received for monitoring and related services provided to customers, as well as the sale and installation of security, fire, and solar systems (referred to as “systems”). Revenue is recognized in the Consolidated Statements of Operations net of sales and other taxes. Amounts collected from customers for sales and other taxes are reported as a liability net of the related amounts remitted. When customers terminate a monitoring contract early, contract termination charges are assessed in accordance with the contract terms and are recognized in monitoring and related services revenue when collectability is probable. The Company allocates the transaction price to each performance obligation based on relative standalone selling price, which is determined using observable internal and external pricing, profitability, and operational metrics. For CSB and Commercial, the Company’s performance obligations generally include monitoring, related services (such as maintenance agreements), and the sale and installation of a security system in outright sales transactions or a material right in transactions in which the Company retains ownership of the security system. Substantially all new CSB transactions since March 2021 take place under a Company-owned model. For Solar, the Company’s performance obligations generally include the sale and installation of a solar system, and may include additional performance obligations such as roofing services or the sale and installation of additional products such as batteries. In February 2020, for certain residential customers, the Company (i) revised the amount and nature of fees due at installation, (ii) introduced a 60-month monitoring contract option, and (iii) introduced a retail installment contract option (as discussed below). Disaggregated Revenue Years Ended December 31, (in thousands) 2022 2021 2020 CSB: Monitoring and related services $ 4,050,019 $ 3,873,285 $ 3,760,614 Security installation, product, and other 328,786 272,743 564,575 Total CSB 4,378,805 4,146,028 4,325,189 Commercial: Monitoring and related services 539,246 474,428 426,373 Security installation, product, and other 690,833 639,304 563,225 Total Commercial 1,230,079 1,113,732 989,598 Solar: Solar installation, product, and other 786,426 47,351 — Total Solar 786,426 47,351 — Total revenue $ 6,395,310 $ 5,307,111 $ 5,314,787 Company-Owned In transactions in which the Company provides monitoring and related services but retains ownership of the security system (referred to as Company-owned transactions), the Company’s performance obligations primarily include monitoring and related services, as well as a material right associated with one-time non-refundable fees charged in connection with the initiation of a monitoring contract which the customer will not be required to pay again upon a renewal of the contract. The portion of the transaction price associated with monitoring and related services is recognized when these services are provided to the customer and is reflected in monitoring and related services revenue. The portion of the transaction price associated with the material right is deferred upon initiation of a monitoring contract (referred to as deferred subscriber acquisition revenue). Deferred subscriber acquisition revenue is amortized into security installation, product, and other revenue on a pooled basis over the estimated life of the customer relationship using an accelerated method consistent with the treatment of subscriber system assets and deferred subscriber acquisition costs. Years Ended December 31, ( in thousands ) 2022 2021 2020 Amortization of deferred subscriber acquisition revenue $ 244,141 $ 172,061 $ 124,804 Customer-Owned CSB and Commercial - In transactions involving security systems sold outright to the customer (referred to as outright sales), the Company’s performance obligations generally include the sale and installation of the system, as well as any monitoring and related services. The portion of the transaction price associated with the sale and installation of a system is recognized either at a point in time or over time based upon the nature of the transaction and contractual terms and is reflected in security installation, product, and other revenue. For revenue recognized over time, progress toward complete satisfaction of the performance obligation is primarily measured using a cost-to-cost measure of progress method. The cost input driving revenue recognition for contracts where revenue is recognized over time is based primarily on contract cost incurred to date compared to total estimated contract cost. This measure of progress method includes forecasts based on the best information available and reflects the Company’s judgment to faithfully depict the value of the services transferred to the customer. Approximately half of security installation, product, and other revenue generated by the Commercial segment is recognized over time. The portion of the transaction price associated with monitoring and related services revenue is recognized when services are provided to the customer. Solar - The Company’s performance obligations generally include the sale and installation of a solar system. Transactions within the Solar business may also include additional performance obligations such as roofing services or the sale and installation of additional products (such as batteries). Revenue is recognized when control over the products and services are transferred to the customer and is reflected in solar installation, product, and other revenue. Revenue and cost of revenue from Solar equipment was approximately $451 million and $292 million, respectively, during 2022, and were not material during 2021 subsequent to the date of the ADT Solar Acquisition. The Company also enters into agreements with third-party lenders in order to access loan products for the Company’s Solar customers. These lenders remit the amount of such loans, net of fees, upon installation or based on other contractual terms with the third-party lenders. These fees are recorded as a reduction of solar installation, product, and other revenue and were approximately $141 million during 2022. These fees were not material during 2021 subsequent to the date of the ADT Solar Acquisition. During 2022, the Company incurred charges of approximately $21 million associated with (i) receivables and rebates that are not expected to be collected from a former third party lender that provided loan products to the Company’s Solar customers due to this third party lender entering a formal insolvency proceeding to effectuate the wind-down of its operations, as well as (ii) third-party loans for systems not expected to achieve permission to operate. Deferred Revenue Deferred revenue represents customer billings for services not yet rendered and is primarily related to recurring monitoring and related services. In addition, payments received for the sale and installation of a system after the agreement is signed but before performance obligations are satisfied are recorded as deferred revenue. These amounts are recorded as current deferred revenue, as the Company expects to satisfy any remaining performance obligations, as well as recognize the related revenue, within the next twelve months when performance obligations are satisfied. Accordingly, the Company has applied the practical expedient regarding deferred revenue to exclude the value of remaining performance obligations if (i) the contract has an original expected term of one year or less or (ii) the Company recognizes revenue in proportion to the amount it has the right to invoice for services performed. Accounts Receivable Accounts receivable represent unconditional rights to consideration from customers in the ordinary course of business and are generally due in one year or less. The Company’s accounts receivable are recorded at amortized cost less an allowance for credit losses not expected to be recovered. The allowance for credit losses is recognized at inception and reassessed each reporting period. The Company evaluates its allowance for credit losses on accounts receivable in pools based on customer type. For each customer pool, the allowance for credit losses is estimated based on the delinquency status of the underlying receivables and the related historical loss experience, as adjusted for current and expected future conditions, if applicable. The allowance for credit losses is not material for the individual pools of customers. Changes in the Allowance for Credit Losses: Years Ended December 31, (in thousands) 2022 2021 2020 (1) Beginning balance $ 54,032 $ 68,342 $ 42,960 Provision for credit losses (2) 99,760 51,877 81,713 Write-offs, net of recoveries (3) (88,137) (66,187) (56,331) Ending balance $ 65,655 $ 54,032 $ 68,342 ________________ (1) Beginning balance reflected is subsequent to the adoption on January 1, 2020 of ASU 2016-13, Measurement of Credit Losses on Financial Instruments, and related amendments. The impact of adoption was not material. (2) The provisions for credit losses during 2021 and 2020 were impacted by adjustments related to the COVID-19 Pandemic. (3) Recoveries were not material for the periods presented. As such, write-offs are presented net of recoveries. Retail Installment Contract Receivables For security system transactions occurring under both Company-owned and customer-owned equipment models, the Company’s retail installment contract option allows qualifying residential customers to pay the fees due at installation over a 24-, 36-, or 60-month interest-free period. The financing component of retail installment contract receivables is not significant. Upon origination of a retail installment contract, the Company utilizes external credit scores to assess customer credit quality and determine eligibility. In addition, customers are required to enroll in the Company’s automated payment process in order to enter into a retail installment contract. Subsequent to origination, the Company monitors the delinquency status of retail installment contract receivables as the key credit quality indicator. As of December 31, 2022, the current and delinquent billed retail installment contract receivables were not material. The Company’s retail installment contract receivables are recorded at amortized cost less an allowance for credit losses not expected to be recovered. The allowance for credit losses is recognized at inception and reassessed each reporting period. The allowance for credit losses relates to retail installment contract receivables from outright sales transactions and is not material. The balance of unbilled retail installment contract receivables comprises: December 31, (in thousands) 2022 2021 Retail installment contract receivables, gross $ 532,406 $ 331,512 Allowance for credit losses (890) (907) Retail installment contract receivables, net $ 531,516 $ 330,605 Balance Sheet Classification: Accounts receivable, net $ 169,242 $ 100,385 Other assets 362,274 230,220 Retail installment contract receivables, net $ 531,516 $ 330,605 As of December 31, 2022 and 2021, retail installment contract receivables, net, used as collateral for borrowings under the Receivables Facility were $506 million and $299 million, respectively. Contract Assets Contract assets represent the Company’s right to consideration in exchange for goods or services transferred to the customer. The contract asset is reclassified to accounts receivable as additional services are performed and billed, which is when the Company’s right to the consideration becomes unconditional. The Company has the right to bill customers as services are provided over time, which generally occurs over the course of a 24-, 36-, or 60-month period. The financing component of contract assets is not significant. The Company records an allowance for credit losses against its contract assets for amounts not expected to be recovered. The allowance is recognized at inception and is reassessed each reporting period. The allowance for credit losses on contract assets was not material for the periods presented. The Company recognized approximately $17 million, $26 million, and $183 million of gross contract assets during 2022, 2021, and 2020, respectively. The balance of contract assets for residential transactions comprises: December 31, (in thousands) 2022 2021 Contract assets, gross $ 54,305 $ 106,810 Allowance for credit losses (5,453) (12,300) Contract assets, net $ 48,852 $ 94,510 Balance Sheet Classification: Prepaid expenses and other current assets $ 33,632 $ 58,452 Other assets 15,220 36,058 Contract assets, net $ 48,852 $ 94,510 |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION As discussed in Note 1 “Description of Business and Summary of Significant Accounting Policies,” the Company reports results in three operating and reportable segments. The Company organizes its segments based on customer type as follows: • CSB - The CSB segment primarily includes (i) revenue and operating costs from the sale, installation, servicing, and monitoring of integrated security and automation systems, as well as other related offerings; (ii) other operating costs associated with support functions related to these operations; and (iii) general corporate costs and other income and expense items not included in the Commercial and Solar segments. Customers in the CSB segment are comprised of owners and renters of residential properties, small business operators, and other individual consumers. • Commercial - The Commercial segment primarily includes (i) revenue and operating costs from the sale, installation, servicing, and monitoring of integrated security and automation systems, fire detection and suppression systems, and other related offerings; (ii) other operating costs associated with support functions related to these operations; and (iii) certain dedicated corporate costs and other income and expense items. Customers in the Commercial segment are comprised of larger businesses with more expansive facilities (typically larger than 10,000 square feet) and/or multi-site operations, which often require more sophisticated integrated solutions. • Solar - The Solar segment primarily includes (i) revenue and operating costs from the sale and installation of solar and related solutions and services; (ii) other operating costs associated with support functions related to these operations; and (iii) certain dedicated corporate costs and other income and expense items. Customers in the Solar segment are comprised of residential homeowners who purchase solar and energy storage solutions, energy efficiency upgrades, and roofing services. The CODM uses Adjusted EBITDA, which is the Company’s segment profit measure, to evaluate segment performance. Adjusted EBITDA is defined as net income (loss) adjusted for (i) interest; (ii) taxes; (iii) depreciation and amortization, including depreciation of subscriber system assets and other fixed assets and amortization of dealer and other intangible assets; (iv) amortization of deferred costs and deferred revenue associated with subscriber acquisitions; (v) share-based compensation expense; (vi) merger, restructuring, integration, and other; (vii) losses on extinguishment of debt; (viii) radio conversion costs, net; and (ix) other income/gain or expense/loss items such as changes in fair value of certain financial instruments, impairment charges, financing and consent fees, or acquisition-related adjustments. The CODM does not review the Company's assets by segment; therefore, such information is not presented. The accounting policies of the Company’s reportable segments are the same as those of the Company. Reconciliations The following table presents total revenue by segment and a reconciliation to consolidated total revenue: Years Ended December 31, (in thousands) 2022 2021 2020 CSB $ 4,378,805 $ 4,146,028 $ 4,325,189 Commercial 1,230,079 1,113,732 989,598 Solar 786,426 47,351 — Total Revenue $ 6,395,310 $ 5,307,111 $ 5,314,787 The following table presents Adjusted EBITDA by segment and a reconciliation to consolidated income (loss) before income taxes and equity in net earnings (losses) of equity method investee: Years Ended December 31, (in thousands) 2022 2021 2020 Adjusted EBITDA by segment: CSB $ 2,314,633 $ 2,110,879 $ 2,153,899 Commercial 126,940 96,112 45,338 Solar 5,155 5,588 — Total $ 2,446,728 $ 2,212,579 $ 2,199,237 Reconciliation: Total segment Adjusted EBITDA (1) $ 2,446,728 $ 2,212,579 $ 2,199,237 Less: Interest expense, net 265,285 457,667 708,189 Depreciation and intangible asset amortization 1,693,575 1,914,779 1,913,767 Amortization of deferred subscriber acquisition costs 162,981 126,089 96,823 Amortization of deferred subscriber acquisition revenue (244,141) (172,061) (124,804) Share-based compensation expense 66,566 61,237 96,013 Merger, restructuring, integration, and other (2) 22,232 37,872 120,208 Goodwill impairment (3) 200,974 — — Loss on extinguishment of debt (4) — 37,113 119,663 Change in fair value of financial instruments (5) 63,396 — — Radio conversion costs, net (6) 3,353 211,363 51,889 Acquisition-related adjustments (7) 35,229 12,945 438 Equity in net earnings (losses) of equity method investee (4,601) — — Other (8) (3,935) (3,236) (4,030) Income (loss) before income taxes and equity in net earnings (losses) of equity method investee $ 185,814 $ (471,189) $ (778,919) ___________________ (1) Except for the presentation of goodwill impairment and income (loss) before income taxes and equity in net earnings (losses) of equity method investee, total segment Adjusted EBITDA did not change as a result of the restatement. (2) Refer to Note 4 “Acquisitions and Disposition.” (3) Represents a goodwill impairment charge associated with the Company’s Solar reporting unit (as discussed in Note 1 “Description of Business and Summary of Significant Accounting Policies” and Note 6 “Goodwill and Other Intangible Assets”). (4) Refer to Note 7 “Debt.” (5) Represents the change in fair value of the Forward Contract (as defined and discussed in Note 10 “Equity”). (6) Refer to Note 1 “Description of Business and Summary of Significant Accounting Policies.” (7) During 2022 and 2021, primarily represents the amortization of the customer backlog intangible asset acquired in the ADT Solar Acquisition, which was fully amortized as of March 2022. Refer to Note 4 “Acquisitions and Disposition.” (8) During 2022, primarily represents the gain on sale of a business. During 2020, included recoveries of $10 million associated with notes receivable from a former strategic investment. Entity-Wide Disclosures Revenue is attributed to individual countries based upon the operating entity that records the transaction. Revenue outside of the U.S. is not material. As of December 31, 2022 and 2021, substantially all of the Company’s assets were located in the U.S. |
Acquisitions and Disposition
Acquisitions and Disposition | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Disposition | ACQUISITIONS AND DISPOSITION From time to time, the Company may pursue business acquisitions that either strategically fit with the Company’s existing core business or expand the Company’s products and services into new and attractive adjacent markets. The Company accounts for business acquisitions under the acquisition method of accounting. The assets acquired and liabilities assumed in connection with business acquisitions are recorded at the date of acquisition at their estimated fair values, with any excess of the purchase price over the estimated fair values of the net assets acquired recorded as goodwill. Significant judgment is required in estimating the fair value of assets acquired and liabilities assumed and in assigning useful lives to certain definite-lived intangible and tangible assets. Accordingly, the Company may engage third-party valuation specialists to assist in these determinations. The fair value estimates are based on available information as of the acquisition date and on future expectations and assumptions deemed reasonable by management, but are inherently uncertain. Acquisition-related expenses are recognized as incurred and are included in merger, restructuring, integration, and other and were not material during 2022, 2021, and 2020. ADT Solar Acquisition In December 2021, the Company acquired ADT Solar. The acquisition expanded the Company’s offerings by entering the residential solar market. Upon the consummation of the ADT Solar Acquisition, ADT Solar became an indirect wholly-owned subsidiary of the Company. Total consideration was approximately $750 million, which consisted of cash paid of $142 million, net of cash acquired, and approximately 75.0 million unregistered shares of the Company’s Common Stock, par value of $0.01 per share, with a fair value of $569 million (the “Equity Consideration”), including $40 million related to approximately 5.3 million shares of the Company’s common stock that were issued during 2022 (“Delayed Shares”). The total fair value of the Equity Consideration was based on the closing stock price of the Company’s common stock on December 8, 2021, the acquisition date, adjusted for the impact of contractual restrictions on the ability for the holders to sell their shares. Fair Value of Assets Acquired and Liabilities Assumed (in thousands): Cash $ 38,493 Accounts receivable 35,849 Inventories 49,526 Prepaid expenses and other current assets 12,616 Property and equipment 10,047 Goodwill 712,150 Other definite-lived intangible assets 41,800 Other assets 27,653 Accounts payable (54,223) Deferred revenue (45,966) Accrued expenses and other current liabilities (45,391) Current maturities of long-term debt (7,643) Other liabilities (9,370) Long-term debt (15,112) Total consideration transferred $ 750,429 The purchase price allocation reflects fair value estimates based on management analysis, including work performed by third-party valuation specialists, as of the date of acquisition. Other definite-lived intangible assets is primarily comprised of a customer backlog intangible asset, which was fully recognized during the first quarter of 2022 as a reduction of solar installation, product, and other revenue. The Company recorded goodwill to the Solar reporting unit, the majority of which is deductible for tax purposes. The goodwill recognized as a result of the ADT Solar Acquisition reflects the strategic value and expected synergies of ADT Solar to the Company. Refer to Note 1 “Description of Business and Summary of Significant Accounting Policies” and Note 6 “Goodwill and Other Intangible Assets” for information on a goodwill impairment loss recognized in the Solar reporting unit during the third quarter of 2022. Pro Forma Results The following summary, prepared on a pro forma basis, presents the Company’s unaudited consolidated results of operations for 2021 and 2020 as if the ADT Solar Acquisition had been completed as of January 1, 2020. The pro forma results below include the impact of certain adjustments related to the amortization of intangible assets, acquisition-related costs incurred as of the acquisition date, and in each case, the related income tax effects, as well as certain other post-acquisition adjustments directly attributable to the acquisition. This pro forma presentation does not include any impact of transaction synergies. The pro forma results are not necessarily indicative of the results of operations that actually would have been achieved had the ADT Solar Acquisition been consummated as of that date: Years Ended December 31, ( in thousands ) 2021 2020 Total revenue $ 5,905,148 $ 5,590,880 Net income (loss) $ (328,099) $ (680,992) During 2021, revenue and net loss attributable to ADT Solar of $47 million and $7 million, respectively, are included in the Consolidated Statements of Operations from the acquisition date, December 8, 2021 through December 31, 2021. Defenders Acquisition In January 2020, the Company acquired its largest independent dealer, Defender Holdings, Inc. (“Defenders”) (the “Defenders Acquisition”), for total consideration of approximately $290 million, which consisted of cash paid of $173 million, net of cash acquired, and the issuance of approximately 16 million shares of the Company’s Common Stock, par value of $0.01 per share, with a fair value of $114 million. The Company recorded $252 million of goodwill as a result of the Defenders Acquisition, none of which is deductible for tax purposes, and allocated the goodwill to the CSB reporting unit at the time of acquisition. The goodwill recognized as a result of the Defenders Acquisition reflects the strategic value and expected synergies of Defenders to the Company. In connection with the Defenders Acquisition, the Company recorded a loss in the amount of $81 million during the first quarter of 2020 from the settlement of a pre-existing relationship with Defenders related to customer accounts purchased from Defenders prior to the Defenders Acquisition. The Company included the loss in merger, restructuring, integration, and other, and the associated cash payment is reflected as cash flows from operating activities for the year ended December 31, 2020. Other Acquisitions During 2022, total consideration related to business acquisitions was approximately $31 million, including approximately $15 million in shares of the Company’s common stock (excluding the Delayed Shares), which resulted in the recognition of approximately $20 million of goodwill. During 2021, total consideration related to business acquisitions (excluding the ADT Solar Acquisition) was approximately $21 million. During 2020, total consideration related to business acquisitions (excluding the Defenders Acquisition) was approximately $80 million, including $52 million of cash, net of cash acquired. This resulted in the recognition of $24 million of goodwill, $13 million of contracts and related customer relationships, and $43 million of other intangible assets related to developed technology, on which the Company recorded an impairment loss in the first quarter of 2021 as discussed in Note 6 “Goodwill and Other Intangible Assets.” Disposition During 2022, proceeds related to disposal activities totaled approximately $27 million, resulting in a gain of approximately $10 million recognized in selling, general, and administrative expenses. |
Equity Method Investments
Equity Method Investments | 12 Months Ended |
Dec. 31, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments | EQUITY METHOD INVESTMENTS The Company uses the equity method of accounting to account for an investment in which it has the ability to exercise significant influence but does not control. The carrying amount of the investment is reflected in other assets. The Company recognizes its proportionate share of the investee’s net income or loss in equity in net earnings (losses) of equity method investee. The Company evaluates an equity method investment whenever events or changes in circumstances indicate the carrying amount of such investment may be impaired. If a decline in the value of an equity method investment is determined to be other than temporary, the Company records a loss as a component of the Company’s share of earnings or losses of the equity method investee in the current period. Canopy Investment In April 2022, the Company and Ford Motor Company (“Ford”) formed a new entity, SNTNL LLC (“Canopy”), which combines ADT’s professional security monitoring and Ford’s AI-driven video camera technology to help customers strengthen security of new and existing vehicles across automotive brands. ADT and Ford expect to invest approximately $100 million collectively during the three years following the closing of the transaction, of which ADT will contribute 40%. As part of the initial funding at closing, the Company contributed cash of approximately $11 million (the “Initial Contribution”). As of December 31, 2022, Canopy did not have any common stock equivalents or dilutive securities that would, if converted, exercised, or issued, significantly change the Company’s proportionate share of Canopy’s net assets or net income or loss. Variable Interest Entity (“VIE”) Canopy meets the definition of a VIE because the Company holds a variable interest through its 40% investment in Canopy’s preferred class of equity (the “Canopy Investment”) and fees received under the Canopy Commercial Agreements described below. The Company is not the primary beneficiary, and therefore, does not consolidate Canopy’s assets, liabilities, and financial results of operations. As a result, the Company accounts for its investment in Canopy under the equity method of accounting. The Company records its proportionate share of Canopy’s net income or loss on a one-month delay. As of December 31, 2022, the Canopy Investment’s carrying amount was approximately $7 million and is presented in other assets. The balance reflects the Initial Contribution as well as the Company’s proportionate share of Canopy’s net loss during the period. As of December 31, 2022, Canopy’s net assets primarily consisted of cash and construction in progress. Canopy Commercial Agreements In connection with the Canopy Investment, the Company entered into various commercial agreements (the “Canopy Commercial Agreements”) through which it will perform various services on behalf of Canopy, including supply chain support, product engineering support, and monitoring services for Canopy customers. The Company and Canopy are also parties to a trade name licensing agreement. The impact to the consolidated financial statements from the Canopy Commercial Agreements was not material for the periods presented. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill During the periods presented, changes in the carrying amount of goodwill by reportable segment were as follows: (in thousands) CSB Commercial Solar Total Balance as of January 1, 2021 (1) $ 4,906,691 $ 329,611 $ — $ 5,236,302 Acquisitions (2)(3) (25) 12,400 694,726 707,101 Balance as of December 31, 2021 4,906,666 342,011 694,726 5,943,403 Acquisitions (3) 12,585 6,309 17,424 36,318 Impairment (4) — — (200,974) (200,974) Disposition — (11,731) — (11,731) Balance as of December 31, 2022 (Restated) $ 4,919,251 $ 336,589 $ 511,176 $ 5,767,016 ________________ (1) Reflects the allocated goodwill from the reporting unit change during the fourth quarter of 2020, in which the Company reassigned a portion of goodwill on a relative fair value basis related to the Company’s commercial customers from the CSB reporting unit (previously, the U.S. reporting unit) to the Commercial reporting unit (previously, the Red Hawk reporting unit). Beginning in the first quarter of 2021, the Company began reporting results for two operating and reportable segments, CSB and Commercial, which comprise the CSB and Commercial reporting units, respectively. (2) Upon consummation of the ADT Solar Acquisition in the fourth quarter of 2021, the Company began reporting results for a third operating and reportable segment related to the ADT Solar business, which comprises the Solar reporting unit. (3) Includes the impact of measurement period adjustments, which were not material during the periods presented. (4) Amount presented as restated. Refer to Note 1 “Description of Business and Summary of Significant Accounting Policies.” As of December 31, 2022, accumulated goodwill impairment losses totaled $201 million (as restated). As of December 31, 2021 and 2020, the Company had no accumulated goodwill impairment losses. Other Intangible Assets December 31, 2022 December 31, 2021 (in thousands) Gross Carrying Accumulated Net Carrying Amount Gross Carrying Accumulated Net Carrying Amount Definite-lived intangible assets: Contracts and related customer relationships (1) $ 7,021,305 $ (4,262,383) $ 2,758,922 $ 8,719,363 $ (5,753,345) $ 2,966,018 Dealer relationships (2) 1,518,020 (538,801) 979,219 1,518,020 (459,248) 1,058,772 Other (3) 224,783 (204,177) 20,606 263,133 (207,572) 55,561 Total definite-lived intangible assets 8,764,108 (5,005,361) 3,758,747 10,500,516 (6,420,165) 4,080,351 Indefinite-lived intangible assets: Trade name (4) 1,333,000 — 1,333,000 1,333,000 — 1,333,000 Intangible assets $ 10,097,108 $ (5,005,361) $ 5,091,747 $ 11,833,516 $ (6,420,165) $ 5,413,351 __________________ (1) During 2022, the Company retired $2.3 billion of certain customer relationship intangible assets acquired in the ADT Acquisition that became fully amortized. (2) Originated from the Formation Transactions and the ADT Acquisition in 2015 and 2016, respectively. Amortized primarily over 19 years on a straight-line basis based on management estimates about attrition and the longevity of the underlying dealer network that existed at the time of acquisition. (3) Primarily relates to trade names and other technology assets. Amortized over a period of up to 10 years on a straight-line basis. (4) ADT trade name acquired as part of the ADT Acquisition. Contracts and Related Customer Relationships Contracts and related customer relationships comprise customer relationships that originated from business acquisitions as well as contracts with customers purchased under the ADT Authorized Dealer Program (as defined below) or from other third parties. Customer relationships acquired as part of business acquisitions, which primarily originated from the Formation Transactions and the ADT Acquisition, are amortized over a period of up to 20 years based on management estimates about the amounts and timing of estimated future revenue from customer accounts and average customer account life that existed at the time of the related business acquisition. Additionally, the Company maintains a network of agreements with third-party independent alarm dealers who sell alarm equipment and ADT Authorized Dealer-branded monitoring and interactive services to residential end users (the “ADT Authorized Dealer Program”). The dealers in this program generate new end-user contracts with customers which the Company has the right, but not the obligation, to purchase from the dealer. Purchases of contracts with customers under the ADT Authorized Dealer Program, or from other third parties, are considered asset acquisitions and are recognized based on the cost to acquire the assets, which may include cash consideration, non-cash consideration, contingent consideration, and directly-attributable transaction costs. The Company may charge back the purchase price of any end-user contract if the contract is canceled during the charge-back period, which is generally thirteen months from the date of purchase. The Company records the amount of the charge back as a reduction to the purchase price. Purchases of contracts with customers under the ADT Authorized Dealer Program, or from other third parties, are accounted for on a pooled basis based on the month and year of acquisition. The Company amortizes its pooled contracts with customers using an accelerated method over the estimated life of the customer relationship, which is 15 years. The accelerated method for amortizing these contracts utilizes an average declining balance rate of approximately 300% and converts to straight-line methodology when the resulting amortization charge is greater than that from the accelerated method, resulting in an average amortization of approximately 65% of the pool within the first five years, 25% within the second five years, and 10% within the final five years. The change in the net carrying amount of contracts and related customer relationships was as follows: Years Ended December 31, (in thousands) 2022 2021 Beginning balance $ 2,966,018 $ 3,374,156 Acquisition of customer relationships 3,000 5,333 Customer contract additions, net of dealer charge-backs 633,442 696,316 Amortization (841,899) (1,109,787) Other (1,639) — Ending balance $ 2,758,922 $ 2,966,018 During each of 2022 and 2021, the weighted-average amortization period for customer contract additions under the ADT Authorized Dealer Program and from other third parties was 14 years. During 2022, 2021, and 2020, the Company paid $622 million, $675 million, and $381 million, respectively, for customer contracts under the ADT Authorized Dealer Program and from other third parties, which is included in dealer generated customer accounts and bulk account purchases. During 2022 and 2021, customer contract additions include customer accounts purchased from certain other third parties for an aggregate contractual purchase price of $111 million and $163 million, respectively, subject to reduction based on customer retention. The Company paid initial cash at the closings in the aggregate amounts of $82 million and $132 million, respectively, which is included in the payments for dealer generated customer accounts and bulk account purchases discussed above. Definite-Lived Intangible Asset Amortization Expense Years Ended December 31, (in thousands) 2022 2021 2020 Definite-lived intangible asset amortization expense $ 934,700 $ 1,209,966 $ 1,222,398 As of December 31, 2022, the estimated aggregate amortization expense on our existing intangible assets is expected to be as follows ( in thousands) : 2023 2024 2025 2026 2027 Thereafter $ 597,695 $ 484,023 $ 422,112 $ 372,228 $ 337,209 $ 1,545,480 Goodwill and Indefinite-Lived Intangible Assets Impairment Goodwill and indefinite-lived intangible assets are not amortized and are tested for impairment at least annually as of the first day of the fourth quarter of each year and more often if an event occurs or circumstances change which indicate it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount. The Company may perform its impairment test for any reporting unit or indefinite-lived intangible asset through a qualitative assessment or elect to proceed directly to a quantitative impairment test, however, the Company may resume a qualitative assessment in any subsequent period if facts and circumstances permit. Goodwill Under a qualitative approach, the Company assesses whether it is more-likely-than-not that a reporting unit’s fair value is less than its carrying amount. If the Company elects to bypass the qualitative assessment for any reporting unit, or if a qualitative assessment indicates it is more-likely-than-not that the estimated fair value of a reporting unit is less than its carrying amount, the Company proceeds to a quantitative approach. Under a quantitative approach, the Company estimates the fair value of a reporting unit and compares it to its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company estimates the fair values of its reporting units using the income approach, which discounts projected cash flows using market participant assumptions. The income approach includes significant assumptions including, but not limited to, forecasted revenue, operating profit margins, Adjusted EBITDA margins, operating expenses, cash flows, perpetual growth rates, and discount rates. The estimated fair value of a reporting unit calculated using the income approach is sensitive to changes in the underlying assumptions. In developing these assumptions, the Company relies on various factors including operating results, business plans, economic projections, anticipated future cash flows, and other market data. Examples of events or circumstances that could reasonably be expected to negatively affect the underlying judgments and factors and ultimately impact the estimated fair value determinations may include such items as a prolonged downturn in the business environment, changes in economic conditions that significantly differ from the Company’s assumptions in timing or degree, volatility in equity and debt markets resulting in higher discount rates, and unexpected regulatory changes. As a result, there are inherent uncertainties related to these judgments and factors that may ultimately impact the estimated fair value determinations. Except as discussed below within the Solar reporting unit, the Company did not record any goodwill impairment losses during the periods presented. CSB - Based on the results of a qualitative goodwill impairment test as of October 1, 2022, the Company concluded it is more likely than not that the fair value of the CSB reporting unit exceeds its carrying value. Commercial - Based on the results of a quantitative goodwill impairment test as of October 1, 2022, the Company concluded the fair value of the Commercial reporting unit exceeds its carrying value by approximately 50%. The reporting unit performed above expectations in 2022, thus driving an increase in projected future period growth. Solar Goodwill Impairment During the third quarter of 2022, as a result of ADT Solar’s underperformance of recent operating results in successive quarters relative to expectations, as well as current macroeconomic conditions, including the impact of increasing interest rates, the Company performed an interim quantitative impairment assessment and recorded a goodwill impairment loss of $201 million (as restated). Additionally, on October 1, 2022, the Company quantitatively tested the goodwill associated with the Solar reporting unit as part of its annual goodwill impairment test. Based on the results of the quantitative test, and as the carrying value of the Solar reporting unit approximates its fair value following the impairment charge in the third quarter of 2022, the Solar reporting unit is considered at risk of future impairment. If the Company’s assumptions are not realized, or if there are future changes in any of the assumptions due to a change in economic conditions or otherwise, it is possible that a further impairment charge may need to be recorded in the future. Indefinite-Lived Intangible Assets Under a qualitative approach, the impairment test for an indefinite-lived intangible asset consists of an assessment of whether it is more-likely-than-not that an asset’s fair value is less than its carrying amount. If the Company elects to bypass the qualitative assessment for any indefinite-lived intangible asset, or if a qualitative assessment indicates it is more-likely-than-not that the estimated carrying amount of such asset exceeds its fair value, the Company proceeds to a quantitative approach. Under a quantitative approach, the Company estimates the fair value of an asset and compares it to its carrying amount. If the carrying amount exceeds fair value, an impairment loss is recognized in an amount equal to that excess. The fair value of an indefinite-lived intangible asset is determined based on the nature of the underlying asset. The Company’s only indefinite-lived intangible asset is the ADT trade name. The fair value of the ADT trade name is determined under a relief from royalty method, which is an income approach that estimates the cost savings that accrue to the Company that it would otherwise have to pay in the form of royalties or license fees on revenue earned through the use of the asset. The utilization of the relief from royalty method requires the Company to make significant assumptions including revenue growth rates, the implied royalty rate, and the discount rate. As of October 1, 2022, the Company quantitatively tested the ADT trade name for impairment. Based on the results of the October 1, 2022 test, the Company did not record any impairment losses associated with the ADT trade name, and the estimated fair value of the trade name significantly exceeded its carrying amount. During 2021 and 2020, the Company did not record any impairment losses on its indefinite lived intangible assets. Definite-Lived Intangible Asset Impairment During the first quarter of 2021, the Company recognized $18 million in impairment losses on its other definite-lived intangible assets primarily due to lower than expected benefits from the Cell Bounce developed technology intangible asset, which is included in the CSB segment, as a result of the worldwide shortages for certain electronic components at that time. The fair value was determined using an income-based approach, and the loss is reflected in merger, restructuring, integration, and other. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | DEBT The Company’s debt is comprised of the following (in thousands) : Interest Payable Balance as of December 31, Debt Description Issued Maturity Interest Rate (1) 2022 2021 First Lien Term Loan due 2026 9/23/2019 9/23/2026 Adj. LIBOR +2.75% Quarterly $ 2,730,269 $ 2,758,058 First Lien Revolving Credit Facility 3/16/2018 6/23/2026 Adj. LIBOR +2.75% Quarterly — 25,000 Second Lien Notes due 2028 1/28/2020 1/15/2028 6.250% 1/15 and 7/15 1,300,000 1,300,000 First Lien Notes due 2024 4/4/2019 4/15/2024 5.250% 2/15 and 8/15 750,000 750,000 First Lien Notes due 2026 4/4/2019 4/15/2026 5.750% 3/15 and 9/15 1,350,000 1,350,000 First Lien Notes due 2027 8/20/2020 8/31/2027 3.375% 6/15 and 12/15 1,000,000 1,000,000 First Lien Notes due 2029 7/29/2021 8/1/2029 4.125% 2/1 and 8/1 1,000,000 1,000,000 ADT Notes due 2023 1/14/2013 6/15/2023 4.125% 6/15 and 12/15 700,000 700,000 ADT Notes due 2032 5/2/2016 7/15/2032 4.875% 1/15 and 7/15 728,016 728,016 ADT Notes due 2042 7/5/2012 7/15/2042 4.875% 1/15 and 7/15 21,896 21,896 Receivables Facility 3/5/2020 11/20/2027 Adj. Daily SOFR +0.85% Monthly 354,741 199,056 Other debt (2) 2,446 4,732 Total debt principal, excluding finance leases 9,937,368 9,836,758 Plus: Finance lease obligations (3) 94,888 93,080 Less: Unamortized debt discount, net (13,415) (16,678) Less: Unamortized deferred financing costs (50,896) (64,014) Less: Unamortized purchase accounting fair value adjustment and other (139,357) (156,456) Total debt 9,828,588 9,692,690 Less: Current maturities of long-term debt, net of unamortized debt discount (871,917) (117,592) Long-term debt $ 8,956,671 $ 9,575,098 __________________ (1) LIBOR refers to the London Interbank Offered Rate. SOFR refers to the Secured Overnight Financing Rate. (2) Other debt primarily consists of vehicle loans at various interest rates and maturities. (3) Refer to Note 14 “Leases” for additional information regarding the Company’s finance leases. First Lien Credit Agreement Concurrently with the consummation of the Formation Transactions, the Company entered into a first lien credit agreement dated as of July 1, 2015 (together with subsequent amendments and restatements, the “First Lien Credit Agreement”), which includes a term loan facility (the “First Lien Term Loan due 2026”) and the First Lien Revolving Credit Facility. The Company is required to make scheduled quarterly principal payments of approximately $7 million, with the remaining balance payable at maturity. The Company may make voluntary prepayments on the First Lien Term Loan due 2026 at any time prior to maturity at par. Additionally, the Company is required to make annual prepayments on the outstanding First Lien Term Loan due 2026 with a percentage of the Company’s excess cash flow, as defined in the First Lien Credit Agreement, if the excess cash flow exceeds a certain specified threshold. As of December 31, 2022, the Company was not required to make an annual prepayment based on the Company’s excess cash flow. The First Lien Term Loan due 2026 has an interest rate calculated as, at the Company’s option, either (a) LIBOR determined by reference to the costs of funds for Eurodollar deposits for the interest period relevant to such borrowing, adjusted for certain additional costs (“Adjusted LIBOR”) with a floor of 0.75% or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum; (ii) the prime rate published by The Wall Street Journal; and (iii) one-month adjusted LIBOR plus 1.00% per annum (“Base Rate”), in each case, plus the applicable margin of 2.75% for Adjusted LIBOR loans and 1.75% fo r Base Rate loans and is payable on each interest payment date, at least quarterly, in arrears. The applicable margin for borrowings under the First Lien Revolving Credit Facility is 2.75% for Adjusted LIBOR loans and 1.75% for Base Rate loans, in each case, subject to adjustment pursuant to a leverage-based pricing grid. In addition, the Company is required to pay a commitment fee between 0.375% and 0.50% (determined based on a net first lien leverage ratio) with respect to the unused commitments under the First Lien Revolving Credit Facility. The Company’s obligations relating to the First Lien Credit Agreement are gu aranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of the Company’s domestic subsidiaries and are secured by first-priority security interests in substantially all of the assets of the Company’s domestic subsidiaries, subject to certain permitted liens and exceptions. Significant activity related to the First Lien Credit Agreement during the periods presented was as follows: • Amendment and Restatement dated as of September 23, 2019 - In September 2019, and in connection with an approximately $300 million repay ment of the First Lien Term B-1 Loan , the Company amended and restated the First Lien Credit Agreement to refinance and replace the $3.4 billion aggregate principal amount of the First Lien Term B-1 Loan with $3.1 billion aggregate principal amount of the First Lien Term Loan due 2026, which was issued at a 1.00% discount, and make other changes to, among other things, provide the Company with additional flexibility to incur additional indebtedness and fund future distributions to stockholders. Deferred financing costs in connection with this amendment and restatement were not material. In December 2020, the Company made a $300 million prepayment on the First Lien Term Loan due 2026, which was applied to the remaining required quarterly principal payments at the time. • Amendment and Restatement dated as of January 27, 2021 - In January 2021, the Company amended and restated the First Lien Credit Agreement to refinance the First Lien Term Loan due 2026, which reduced the applicable margin for Adjusted LIBOR loans from 3.25% to 2.75% and reduced the floor from 1.00% to 0.75%. This amendment also reinstated the quarterly principal payments. • Amendment and Restatement dated as of July 2, 2021 - In July 2021, the Company amended and restated the First Lien Credit Agreement with respect to the First Lien Revolving Credit Facility, which extended the maturity date to June 23, 2026, subject to certain conditions, and obtained an additional $175 million of commitments. During 2022, the Company borrowed $550 million and repaid $575 million under its First Lien Revolving Credit Facility. In December 2021, the Company borrowed $185 million and repaid $160 million under the First Lien Revolving Credit Facility in connection with the ADT Solar Acquisition. As of December 31, 2022, the Company had $575 million in available borrowing capacity under the First Lien Revolving Credit Facility. Term Loan A Facility In September 2022, Prime Security Services Borrower, LLC (“Prime Borrower”), a Delaware limited liability company and a wholly owned indirect subsidiary of the Company, as borrower, and The ADT Corporation, a Delaware corporation and a wholly owned direct subsidiary of Prime Borrower (together with Prime Borrower, the “Term Loan A Facility Borrowers”), entered into a debt commitment letter (the “TLA Commitment Letter”) with various lenders, pursuant to which the lenders have committed, at the option of the Term Loan A Facility Borrowers (in their sole discretion) and subject to the satisfaction or waiver of customary conditions, to provide the Term Loan A Facility Borrowers up to an aggregate principal amount of $600 million of term loans under a senior secured term loan A facility (the “Term Loan A Facility”) under a term loan credit agreement (the “Term Loan A Credit Agreement”) on or before March 15, 2023 (the “TLA Commitment Termination Date”). On or before the TLA Commitment Termination Date, the Term Loan A Facility Borrowers may, but are not required to, execute the Term Loan A Credit Agreement and incur indebtedness under the Term Loan A Facility (the “Execution Date”). Additionally, at the option of the Term Loan A Facility Borrowers, the commitments set forth in the TLA Commitment Letter may be terminated at any time prior to the TLA Commitment Termination Date. The proceeds of any borrowings under the Term Loan A Facility are required to be used to redeem a portion of the 4.125% senior notes due June 15, 2023 issued by The ADT Corporation (the “ADT Notes due 2023”). The Term Loan A Facility will have a maturity date of five The Term Loan A Facility will require scheduled quarterly principal payments in annual amounts equal to 5.00% of the original principal amount of the Term Loan A Facility, with the balance payable at maturity. The Term Loan A Facility Borrowers may make voluntary prepayments on the Term Loan A Facility at any time prior to maturity at par. Borrowings under the Term Loan A Facility, if any, will bear interest at a rate equal to, at Prime Borrower’s option, either (a) a term SOFR rate plus an adjustment of 0.10% (“Adjusted SOFR”) or (b) a base rate (“TLA Base Rate”) determined by reference to the highest of (i) the federal funds rate plus 0.50% per annum; (ii) the prime rate published by The Wall Street Journal; and (iii) the one-month Adjusted SOFR plus 1.00% per annum, in each case, plus an applicable margin of 2.50% per annum for Adjusted SOFR loans and 1.50% per annum for TLA Base Rate loans, subject to adjustments based on certain specified net first lien leverage ratios. Indebtedness incurred under the Term Loan A Facility will be guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of Prime Borrower’s wholly owned material domestic subsidiaries, and by Prime Borrower’s direct parent on a limited recourse basis, and will be secured by a pledge of Prime Borrower’s capital stock directly held by its direct parent and by first-priority security interests in substantially all of the assets of Prime Borrower and the subsidiary guarantors, in each case subject to certain permitted liens and exceptions. The Term Loan A Facility will be subject to customary mandatory prepayment provisions, covenants and restrictions, including a financial maintenance covenant requiring the Term Loan A Facility Borrowers to comply as of the last day of each fiscal quarter with a specified maximum consolidated net first lien leverage ratio. During 2022, fees associated with the TLA Commitment Letter were not material; and as of December 31, 2022, the Company has not incurred indebtedness pursuant to the TLA Commitment Letter. Second Lien Notes due 2028 In January 2020, the Company issued $1.3 billion aggregate principal amount of 6.250% second-priority senior secured notes due 2028 (the “Second Lien Notes due 2028”). The proceeds from the Second Lien Notes due 2028, along with cash on hand and borrowings under the First Lien Revolving Credit Facility, were used to redeem the outstanding $1.2 billion aggregate principal amount of Prime Notes (as defined below) and pay any related fees and expenses, including the call premium. The Second Lien Notes due 2028 will mature on January 15, 2028 with semi-annual interest payment dates of January 15 and July 15. As of January 15, 2023, the Second Lien Notes due 2028 may be redeemed at the Company’s option in whole at any time or in part from time to time, at a redemption price equal to 103.125% of the principal amount of the Second Lien Notes due 2028 redeemed and accrued and unpaid interest as of, but excluding, the redemption date. The redemption price decreases to 101.563% on or after January 15, 2024 and decreases to 100% on or after January 15, 2025. The Company’s obligations relating to the Second Lien Notes due 2028 are guaranteed, jointly and severally, on a senior secured second-priority basis, by substantially all of the Company’s domestic subsidiaries and are secured by second-priority security interests in substantially all of the assets of the Company’s domestic subsidiaries, subject to certain permitted liens and exceptions. Additionally, upon the occurrence of specified change of control events, the Company must offer to repurchase the Second Lien Notes due 2028 at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The Second Lien Notes due 2028 also provide for customary events of default. First Lien Notes First Lien Notes due 2024 and First Lien Notes due 2026 The Company’s 5.250% first-priority senior secured notes due 2024 (the “First Lien Notes due 2024”) and the Company’s 5.750% first-priority senior secured notes due 2026 (the “First Lien Notes due 2026”) are due at maturity, and may be redeemed, in whole or in part, at any time at a make-whole premium plus accrued and unpaid interest to, but excluding, the redemption date. The First Lien Notes due 2024 and the First Lien Notes due 2026 are guaranteed, jointly and severally, on a senior secured first-priority basis, by each of the Company’s existing and future direct or indirect wholly-owned material domestic subsidiaries that guarantee the First Lien Credit Agreement. Upon the occurrence of specified change of control events, the Company must offer to repurchase the notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. First Lien Notes due 2027 In August 2020, the Company issued $1.0 billion aggregate principal amount of 3.375% first-priority senior secured notes due 2027 (the “First Lien Notes due 2027”). The proceeds from the First Lien Notes due 2027, along with cash on hand, were used to redeem the outstanding $1.0 billion aggregate principal amount of the 6.250% notes due 2021 issued by The ADT Corporation (the “ADT Notes due 2021”), pay accrued and unpaid interest on the ADT Notes due 2021, and pay any related fees and expenses, including the call premium on the ADT Notes due 2021. The deferred financing costs incurred in connection with the issuance of the First Lien Notes due 2027 were not material. The First Lien Notes due 2027 are due at maturity and may be redeemed at the Company’s option as follows: • Prior to August 31, 2026, in whole at any time or in part from time to time, at a make-whole premium plus accrued and unpaid interest, if any, thereon to the redemption date. • On or after August 31, 2026, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the First Lien Notes due 2027 redeemed plus accrued and unpaid interest, if any, thereon to the redemption date. The Company’s obligations relating to the First Lien Notes due 2027 are guaranteed, jointly and severally, on a senior secured first-priority basis, by each of the Company’s domestic subsidiaries that guarantees its First Lien Credit Agreement and by each of the Company’s future domestic subsidiaries that guarantees certain of the Company’s debt. The First Lien Notes due 2027 and the related guarantees are secured by first-priority security interests in substantially all of the tangible and intangible assets owned by the issuers and each guarantor, subject to certain permitted liens and exceptions. Upon the occurrence of specified change of control events, the Company must offer to repurchase the notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The indenture also provides for customary events of default. First Lien Notes due 2029 In July 2021, the Company issued $1.0 billion aggregate principal amount of 4.125% first-priority senior secured notes due 2029 (the “First Lien Notes due 2029”). The related deferred financing costs were not material. The First Lien Notes due 2029 will mature on August 1, 2029, with semi-annual interest payment dates of February 1 and August 1 of each year, beginning February 1, 2022, and may be redeemed at the Company’s option as follows: • Prior to August 1, 2028, in whole at any time or in part from time to time, at a redemption price equal to the greater of (i) 100% of the principal amount of the First Lien Notes due 2029 to be redeemed and (ii) the sum of the present values of the aggregate principal amount of the First Lien Notes due 2029 to be redeemed and the remaining scheduled interest payments due on any date after the redemption date, to and including August 1, 2028, discounted at an adjusted treasury rate plus 50 basis points, plus, in either case accrued and unpaid interest as of, but excluding, the redemption date. • On or after August 1, 2028, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the First Lien Notes due 2029 to be redeemed and accrued and unpaid interest as of, but excluding, the redemption date. The Company’s obligations relating to the First Lien Notes due 2029 are guaranteed, jointly and severally, on a senior secured first-priority basis, by substantially all of the Company’s subsidiaries and are secured by first-priority security interests in substantially all of the assets of the Company’s domestic subsidiaries, subject to certain permitted liens and exceptions. Upon the occurrence of specified change of control events, the Company may be required to purchase the notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. The indenture also provides for customary events of default. ADT Notes In connection with the ADT Acquisition, the Company entered into supplemental indentures to notes originally issued by The ADT Corporation (collectively, the “ADT Notes”) providing for each series of ADT Notes to benefit from (i) guarantees by substantially all of the Company’s domestic subsidiaries and (ii) first-priority senior security interests, subject to permitted liens, in substantially all of the existing and future assets of the Company’s domestic subsidiaries. As a result, these notes remained outstanding and became obligations of the Company. The remaining outstanding ADT Notes are due at maturity, and may be redeemed, in whole at any time or in part from time to time, at a redemption price equal to the principal amount of the notes to be redeemed, plus a make-whole premium, plus accrued and unpaid interest as of, but excluding, the redemption date. Additionally, upon the occurrence of specified change of control events, the Company must offer to repurchase the ADT Notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but not including, the purchase date. Significant activity related to the ADT Notes during the periods presented was as follows: • ADT Notes due 2021 - In September 2020, the Company redeemed $1.0 billion aggregate principal amount of the ADT Notes due 2021 for a total redemption price of approximately $1.1 billion, which included the related call premium. • ADT Notes due 2022 - In August 2021, the Company used the proceeds from the First Lien Notes due 2029, along with cash on hand, to (i) redeem all of the $1.0 billion outstanding aggregate principal amount of the Company’s 3.50% notes due 2022 (the “ADT Notes due 2022”) for approximately $1.0 billion, including the related call premium of $28 million, plus accrued and unpaid interest, and (ii) pay related fees and expenses (the “ADT Notes due 2022 Redemption”). • ADT Notes due 2023 - As of December 31, 2022, the Company had an outstanding balance of $700 million under its ADT Notes due 2023 that was classified as a current liability, net of any unamortized debt discount. The Company is required to use borrowings under the Term Loan A Facility to redeem a portion of the ADT Notes due 2023 and pay related fees and expenses incurred in connection with the transaction. Subsequent event - On February 10, 2023, the Company delivered the initial notice of partial redemption for the ADT Notes due 2023, which provides for the partial redemption of $600 million principal amount of the outstanding ADT Notes due 2023 on March 15, 2023, including accrued and unpaid interest on the ADT Notes due 2023 so redeemed. Receivables Facility During March 2020, the Company entered into the Receivables Facility, as amended, whereby the Company obtains financing by selling or contributing certain retail installment contract receivables to the Company’s wholly-owned consolidated bankruptcy-remote special purpose entity (“SPE”). The SPE grants a security interest in those retail installment contract receivables as collateral for cash borrowings under the Receivables Facility. The SPE borrower under the Receivables Facility is a separate legal entity with its own creditors who will be entitled, prior to and upon the liquidation of the SPE, to be satisfied out of the SPE’s assets prior to any assets of the SPE becoming available to the Company (other than the SPE). Accordingly, the assets of the SPE are not available to pay creditors of the Company (other than the SPE), although collections from the transferred retail installment contract receivables in excess of amounts required to repay amounts then due and payable to the SPE’s creditors may be released to the Company and subsequently used by the Company (including to pay other creditors). The SPE’s creditors under the Receivables Facility have legal recourse to the transferred retail installment contract receivables owned by the SPE, and to the Company for certain performance and operational obligations relating to the Receivables Facility, but do not have any recourse to the Company (other than the SPE) for the payment of principal and interest on the advances under the Receivables Facility. Significant amendments to the Receivables Facility were as follows: • In March 2021, the Receivables Facility was amended to, among other things, extend the scheduled termination date for the uncommitted revolving period to March 4, 2022, and reduce the spread over LIBOR payable in respect of borrowings thereunder from 1.00% to 0.85%. • In July 2021, the Receivables Facility was amended into the form of a Receivables Financing Agreement, which continued the uncommitted secured lending arrangement contemplated among the parties and, among other things, provided for certain revisions to funding, prepayment, reporting, and other provisions in preparation for a potential future syndication of the advances made under the Receivables Facility. • In October 2021, the Company further amended the documentation governing the Receivables Facility in connection with the syndication of the advances thereunder to two additional lenders: MUFG Bank, Ltd. and Starbird Funding Corporation (a conduit lender related to BNP Paribas). As part of the amendment, the Receivables Facility’s uncommitted lending limit was increased from $200 million to $400 million, and the scheduled termination date for the Receivable Facility’s uncommitted revolving period was extended to October 28, 2022. • In May 2022, the Company amended the Receivables Facility to change the benchmark rate from 1-month LIBOR to Daily SOFR. In addition, the May 2022 amendment extended the scheduled termination date for the uncommitted revolving period from October 2022 to May 2023, and amended certain other terms to increase the advance rate on pledged collateral. The Company services the transferred retail installment contract receivables and is responsible for ensuring the related collections are remitted to a segregated bank account in the SPE’s name. On a monthly basis, the segregated account is utilized to make required principal, interest, and other payments due under the Receivables Facility. The segregated account is considered restricted cash. Proceeds and repayments from the Receivables Facility were as follows: • During 2022, proceeds and repayments from the Receivables Facility were $277 million and $121 million, respectively. • During 2021, proceeds and repayments were $254 million and $130 million, respectively, both of which include the non-cash impact of approximately $88 million from the Receivables Facility amendment in October 2021. • During 2020, proceeds and repayments from the Receivables Facility were $83 million and $7 million, respectively. The Receivables Facility did not have a material impact to the Consolidated Statements of Operations. As of December 31, 2022, the Company had an uncommitted available borrowing capacity of $45 million under the Receivables Facility. Variable Interest Entity The SPE, as described above, meets the definition of a VIE for which the Company is the primary beneficiary as it has the power to direct the SPE’s activities and the obligation to absorb losses or the right to receive benefits of the SPE. As such, the SPE’s assets, liabilities, and financial results of operations are consolidated in the Company’s consolidated financial statements. As of December 31, 2022 and 2021, the SPE’s assets and liabilities primarily consisted of unbilled retail installment contract receivables, net, of $506 million and $299 million, respectively, and borrowings under the Receivables Facility as presented above. Debt Covenants The First Lien Credit Agreement and indentures associated with the borrowings above contain certain covenants and restrictions that limit the Company’s ability to, among other things: (a) incur additional debt or issue certain preferred equity interests; (b) create liens on certain assets; (c) make certain loans or investments (including acquisitions); (d) pay dividends on or make distributions in respect of the capital stock or make other restricted payments; (e) consolidate, merge, sell, or otherwise dispose of all or substantially all of the Company’s assets; (f) sell assets; (g) enter into certain transactions with affiliates; (h) enter into sale-leaseback transactions; (i) restrict dividends from the Company’s subsidiaries or restrict liens; (j) change the Company’s fiscal year; and (k) modify the terms of certain debt or organizational agreements. In addition, the First Lien Credit Agreement and indentures associated with the borrowings above also provide for customary events of default. The Company is also subject to a springing financial maintenance covenant under the First Lien Credit Agreement, which requires the Company to not exceed a specified first lien leverage ratio at the end of each fiscal quarter if the testing conditions are satisfied. The covenant is tested if the outstanding loans under the First Lien Revolving Credit Facility, subject to certain exceptions, exceed 30% of the total commitments under the First Lien Revolving Credit Facility at the testing date (i.e., the last day of any fiscal quarter). As of December 31, 2022, we were in compliance with all financial covenant and other maintenance tests for all our debt obligations. Loss on Extinguishment of Debt Loss on extinguishment of debt includes the payment of call and redemption premiums, the write-off of unamortized deferred financing costs and discounts, and certain other expenses associated with extinguishment of debt. During 2021, loss on extinguishment of debt totaled $37 million and was primarily due to the call premium and write-off of unamortized fair value adjustments in connection with the ADT Notes due 2022 Redemption. During 2020, loss on extinguishment of debt totaled $120 million and included (i) $66 million associated with the call premium and write-off of unamortized deferred financing costs in connection with the $1.2 billion redemption of the remaining outstanding balance of the Company’s 9.250% second-priority secured notes (the “Prime Notes”) in February 2020, (ii) $49 million associated with the call premium and write-off of unamortized fair value adjustments in connection with the $1.0 billion redemption of the ADT Notes due 2021 in September 2020, and (iii) $5 million associated with the partial write-off of unamortized deferred financing costs and discount in connection with the $300 million repayment of the First Lien Term Loan due 2026 in December 2020. Additional fees and costs associated with financing transactions were not material during 2022, 2021, or 2020. SOFR Transition By June 2023 (the “SOFR Transition Date”), SOFR will replace the forward LIBOR as the applicable benchmark rate for all existing and future issuances of the Company’s debt instruments, including interest rate swaps, with a variable rate component. Existing instruments under the First Lien Credit Agreement will continue to be based on LIBOR until the SOFR Transition Date, unless transitioned to SOFR prior to such date pursuant to the terms of the First Lien Credit Agreement. In addition, any modification, such as a repricing, or any new debt issuances with a variable rate component, will utilize SOFR. Other As of December 31, 2022, the aggregate annual maturities of debt, excluding finance leases, were as follows: (in thousands) 2023 2024 2025 2026 2027 Thereafter Total Debt principal $ 827,145 $ 880,053 $ 108,760 $ 4,051,137 $ 1,020,362 $ 3,049,911 $ 9,937,368 Interest expense (excluding interest income) on the Company’s debt, including finance leases, and interest rate swap contracts was $279 million, $458 million, and $710 million during 2022, 2021, and 2020, respectively. |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | DERIVATIVE FINANCIAL INSTRUMENTS The Company's derivative financial instruments primarily consist of LIBOR-based interest rate swap contracts, which were entered into with the objective of managing exposure to variability in interest rates on the Company's debt. All interest rate swap contracts are reported in the Consolidated Balance Sheets at fair value. For interest rate swap contracts that are: • Not designated as cash flow hedges: Unrealized gains and losses are recognized in interest expense, net. • Designated as cash flow hedges: Unrealized gains and losses are recognized as a component of accumulated other comprehensive income (loss) (“AOCI”) and are reclassified into interest expense, net, in the same period in which the related interest on debt affects earnings. For interest rate swap contracts that have been de-designated as cash flow hedges and for which forecasted cash flows are: • Probable or reasonably possible of occurring: Unrealized gains and losses previously recognized as a component of AOCI are reclassified into interest expense, net, in the same period in which the related interest on variable-rate debt affects earnings through the original maturity date of the related interest rate swap contracts. • Probable of not occurring: Unrealized gains and losses previously recognized as a component of AOCI are immediately reclassified into interest expense, net. As of December 31, 2018, the Company had interest rate swap contracts with an aggregate notional amount of $3.5 billion, of which $2.5 billion were designated as cash flow hedges, with maturities through April 2020 and April 2022. During January and February 2019, the Company entered into additional interest rate swap contracts, which were designated as cash flow hedges, with an aggregate notional amount of $725 million and a maturity of April 2022. In October 2019, and in connection with the refinancing of variable-rate debt under the First Lien Credit Agreement in September 2019, the Company terminated interest rate swap contracts with an aggregate notional amount of $3.8 billion, of which $2.8 billion were designated as cash flow hedges, and concurrently entered into new LIBOR-based interest rate swap contracts, which were designated as cash flow hedges, with an aggregate notional amount of $2.8 billion and maturity of September 2026. As a result, the amount of the unfavorable positions recognized as a component of AOCI related to the terminated cash flow hedges are reclassified into interest expense, net, in the same period in which the related interest on variable-rate debt affects earnings through the original maturity date of the cash flow hedges of April 2022, as the forecasted cash flows are probable or reasonably possible of occurring. Additionally, the new interest rate swap terms represented a blend of the current interest rate environment and the unfavorable positions of the terminated interest rate swap contracts, which resulted in an other-than-insignificant financing element at inception of the new cash flow hedges due to off-market terms. The cash flows associated with interest rate swap contracts that included an other-than-insignificant financing element at inception are reflected as cash flows from financing activities and were $19 million, $56 million, and $38 million during 2022, 2021, and 2020, respectively. Beginning in March 2020, the Company's interest rate swap contracts designated as cash flow hedges with an aggregate notional amount of $3.0 billion were no longer highly effective as a result of changes in the interest rate environment. Accordingly, the Company de-designated the cash flow hedges, and the unrealized gains and losses for the period in which these cash flow hedges were no longer highly effective were recognized in interest expense, net. Unrealized losses previously recognized as a component of AOCI prior to de-designation are being reclassified into interest expense, net, in the same period in which the related interest on variable-rate debt affects earnings through the maturity dates of the interest rate swap contracts, as the forecasted cash flows are probable or reasonably possible of occurring. The impact associated with the interest rate swap contracts de-designated as cash flow hedges and for which the forecasted cash flows are no longer probable of occurring was not material during 2022, 2021, and 2020. Interest Rate Swaps: (in thousands) December 31, Execution Maturity Designation 2022 2021 January 2019 April 2022 Not designated $ — $ 125,000 February 2019 April 2022 Not designated — 300,000 October 2019 September 2026 Not designated 2,800,000 2,800,000 Total notional amount $ 2,800,000 $ 3,225,000 Fair Value of Interest Rate Swaps: December 31, Balance Sheet Classification (in thousands) 2022 2021 Prepaid expenses and other current assets $ 78,110 $ — Other assets $ 105,405 $ — Accrued expenses and other current liabilities $ — $ 50,360 Other liabilities $ — $ 67,976 Unrealized Gain (Loss) on Interest Rate Swaps: Years Ended December 31, (in thousands) 2022 2021 2020 Gain (loss) included in interest expense, net $ 301,851 $ 157,505 $ (60,363) Changes in AOCI: (in thousands) Cash Flow Hedges Balance as of December 31, 2019 $ (59,387) Pre-tax current period change (76,807) Income tax benefit (expense) 18,693 Balance as of December 31, 2020 (117,501) Pre-tax current period change 60,948 Income tax benefit (expense) (14,714) Balance as of December 31, 2021 (71,267) Pre-tax current period change 33,946 Income tax benefit (expense) (8,192) Balance as of December 31, 2022 $ (45,513) Cash Flow Hedges Reclassifications out of AOCI: Years Ended December 31, (in thousands) 2022 2021 2020 Interest expense, net $ 33,946 $ 60,948 $ 54,452 Income tax (benefit) expense $ (8,192) $ (14,714) $ (13,254) There were no other material reclassifications out of AOCI during 2022, 2021, and 2020. As of December 31, 2022, approximately $19 million of AOCI associated with previously designated cash flow hedges is estimated to be reclassified to interest expense, net, within the next twelve months. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the temporary differences between the recognition of revenue and expenses for income tax and financial reporting purposes and between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements. The Company records the effect of a tax rate or law change on the Company’s deferred tax assets and liabilities in the period of enactment. Components of income (loss) before income taxes: Years Ended December 31, (in thousands) 2022 2021 2020 United States $ 183,101 $ (473,504) $ (782,256) Foreign 2,713 2,315 3,337 Income (loss) before income taxes $ 185,814 $ (471,189) $ (778,919) Components of income tax benefit (expense): Years Ended December 31, (in thousands) 2022 2021 2020 Current: Federal $ (184) $ (174) $ 370 State (28,100) (8,367) (27,059) Foreign (691) (570) — Current income tax benefit (expense) (28,975) (9,111) (26,689) Deferred: Federal (43,201) 97,805 133,646 State 24,029 41,901 39,842 Foreign (403) (226) (73) Deferred income tax benefit (expense) (19,575) 139,480 173,415 Income tax benefit (expense) $ (48,550) $ 130,369 $ 146,726 Effective Tax Rate Reconciliation: Reconciliations between the actual effective tax rate on continuing operations and the statutory U.S. federal income tax rate were as follows: Years Ended December 31, 2022 2021 2020 Statutory federal tax rate 21.0 % 21.0 % 21.0 % Statutory state tax rate, net of federal benefits 6.9 % 2.7 % 2.9 % Non-deductible and non-taxable charges (1) 14.1 % 0.3 % (3.1) % Valuation allowance (1.3) % 0.5 % (1.5) % Prior year return adjustments 2.0 % 0.4 % (0.3) % Federal credits (6.4) % — % — % Acquisitions (0.4) % 1.3 % 0.2 % Legislative changes (4.5) % 0.8 % — % Uncertain tax positions (4.9) % — % — % Other (0.4) % 0.7 % (0.4) % Effective tax rate 26.1 % 27.7 % 18.8 % ___________________ (1) During 2022, primarily represents the impact related to the fair value adjustment of the Forward Contract. Deferred Tax Assets and Deferred Tax Liabilities The components of the Company's net deferred tax assets (liabilities) were as follows : December 31, (in thousands) 2022 2021 Deferred tax assets: Accrued liabilities and reserves $ 117,488 $ 113,085 Tax loss and credit carryforwards 468,209 594,821 Disallowed interest carryforward 185,080 140,974 Deferred revenue 187,766 140,604 Other 95,008 101,886 Total deferred tax assets 1,053,551 1,091,370 Valuation allowance (57,715) (60,157) Deferred tax assets, net of valuation allowance $ 995,836 $ 1,031,213 Deferred tax liabilities: Subscriber system assets $ (766,067) $ (729,548) Intangible assets (1,023,895) (1,139,927) Other (97,772) (27,442) Total deferred tax liabilities (1,887,734) (1,896,917) Net deferred tax assets (liabilities) $ (891,898) $ (865,704) The valuation allowance for deferred tax assets relates to the uncertainty of the utilization of certain U.S. federal and state deferred tax assets. In evaluating the Company’s ability to recover its deferred tax assets, the Company considers all available positive and negative evidence, which includes its past operating results, the existence of cumulative losses in the most recent years, and its forecast of future taxable income. In estimating future taxable income, the Company develops assumptions related to the amount of future pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies. These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates the Company is using to manage its underlying businesses. The Company believes that it is more-likely-than-not that it will generate sufficient future taxable income to realize its deferred tax assets, net of valuation allowance. The changes in the valuation allowance for deferred tax assets were as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Beginning balance $ (60,157) $ (68,013) $ (56,841) Income tax benefit (expense) 2,428 2,378 (11,999) Write-offs and other (1) 14 5,478 827 Ending balance $ (57,715) $ (60,157) $ (68,013) __________________ (1) During 2021, includes the removal of valuation allowances associated with certain tax attributes that expired during the year. Both the expired attributes and related valuation allowances were removed concurrently. As of December 31, 2022, the Company had approximately $1.6 billion of U.S. federal net operating loss (“NOL”) carryforwards with expiration periods between 2026 and 2042. Although future utilization will depend on the Company’s actual profitability and the result of income tax audits, the Company anticipates that the majority of its U.S federal NOL carryforwards will be fully utilized prior to expiration. Most of the Company’s U.S. federal NOL carryforwards are subject to limitation due to “ownership changes,” which have occurred under Internal Revenue Code (“IRC”) Section 382. The Company does not, however, expect that this limitation will impact its ability to utilize the U.S. federal NOL carryforwards. As of December 31, 2022, the Company’s valuation allowance for deferred tax assets was primarily related to capital loss carryforwards in both the U.S. and Canada primarily generated in connection with the sale of ADT Canada during 2019. The remainder of the Company’s valuation allowance is related to other tax attributes that are not expected to be realized prior to expiration or due to limitations. The Tax Cuts and Jobs Act of 2017 introduced IRC Section 163(j), which limits the deductibility of interest expense and allows for the excess to be carried forward indefinitely. As of December 31, 2022, the Company has not recorded a valuation allowance against the disallowed interest carryforward as the Company believes it has sufficient sources of future taxable income to realize the related tax benefit. For a discussion of the income tax expense (benefit) restatement, refer to Note 1 “Description of Business and Summary of Significant Accounting Policies.” Unrecognized Tax Benefits The Company recognizes positions taken or expected to be taken in a tax return in the consolidated financial statements when it is more-likely-than-not (i.e., a likelihood of more than 50%) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit with greater than 50% likelihood of being realized upon ultimate settlement. The Company records liabilities for positions that have been taken but do not meet the more-likely-than-not recognition threshold. The Company adjusts the liabilities for unrecognized tax benefits in light of changing facts and circumstances; however, due to the complexity of some of these uncertainties, the ultimate resolution may result in a change to the estimated liabilities. The Company includes interest and penalties associated with unrecognized tax benefits as income tax expense and as a component of the recorded balance of unrecognized tax benefits, which is reflected in other liabilities, or net of related tax loss carryforwards in the Consolidated Balance Sheets. Interest and penalties associated with unrecognized tax benefits were not material to the Company's consolidated financial statements for the periods presented. The following is a roll-forward of unrecognized tax benefits: Years Ended December 31, (in thousands) 2022 2021 2020 Beginning balance $ 66,221 $ 65,990 $ 65,117 Gross increase related to prior year tax positions 5,063 373 1,348 Gross decrease related to prior year tax positions — — (732) Increases related to acquisitions — — 400 Decreases related to lapse of statute of limitation (15,107) (142) (143) Ending balance $ 56,177 $ 66,221 $ 65,990 The Company’s unrecognized tax benefits relate to tax years that are subject to audit by the taxing authorities in the U.S. federal, state and local, and foreign jurisdictions. Based on the current tax statutes and status of its income tax audits, the Company does not expect any significant portion of its unrecognized tax benefits to be resolved in the next twelve months. Open Tax Years by Jurisdiction Jurisdiction Years Open to Audit Federal 2019 - 2021 State 2017 - 2021 Canada 2017 - 2021 The Company files a consolidated return for its U.S. entities and, prior to the sale of ADT Canada in 2019, separate returns for each Canadian entity. These income tax returns are subject to audit by the taxing authorities that may culminate in proposed assessments which may ultimately result in a change to the estimated income taxes. Federal Tax Legislation In response to the COVID-19 Pandemic, the American Rescue Plan Act of 2021 (the “2021 Rescue Act”) and the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) were signed into law in March 2021 and March 2020, respectively, and included significant corporate income tax and payroll tax provisions intended to provide economic relief to address the impact of the COVID-19 Pandemic. During 2020, the Company recognized favorable cash flow impacts related to the accelerated refund of previously generated alternative minimum tax credits, as well as from the deferral of remittance of certain 2020 payroll taxes, of which approximately 50% of the deferred amount was paid during the fourth quarter of 2021, and the remainder paid during January 2023. The Company also recognized a benefit from an increase in the interest expense limitation from 30% to 50% for tax years 2019 and 2020. Tax Cuts and Jobs Act - Certain changes to U.S. federal tax law included in the Tax Cuts and Jobs Act of 2017 had a delayed effective date and have taken effect for 2022. Under IRC Section 163(j), the limitation on net business interest expense deductions will no longer be increased by deductions for depreciation, amortization, or depletion. Under IRC Section 174, specified research and experimentation expenditures must now be capitalized and amortized. Inflation Reduction Act - The Inflation Reduction Act (the “IRA”) was signed into law in August 2022. The IRA, among other provisions, implements (i) a 15% corporate alternative minimum tax (“CAMT”) on book income of corporations whose average annual adjusted financial statement income during the most recently-completed three-year period exceeds $1.0 billion, (ii) a 1% excise tax on net stock repurchases, and (iii) several tax incentives to promote clean energy including an extension of the investment tax credit. Both the CAMT and the excise tax provisions are effective for tax years beginning after December 31, 2022, and as of December 31, 2022, the Company does not anticipate any material impact. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Equity | EQUITY Common Stock and Class B Common Stock During September 2020, the Company amended its articles of incorporation to authorize the issuance of 100,000,000 shares of Class B common stock, par value of $0.01 per share (“Class B Common Stock”), as well as to increase the number of authorized shares of preferred stock, par value of $0.01 per share, to 1,000,000. Accordingly, the Company has two classes of common stock, Common Stock and Class B Common Stock, both of which entitle stockholders to one vote for each share of common stock. Each share of Class B Common Stock has equal status and rights to dividends as a share of Common Stock. The holders of Class B Common Stock have one vote for each share of Class B Common Stock held of record by such holder on all matters on which stockholders are entitled to vote generally; provided, however, that holders of Class B Common Stock, as such, are not entitled to vote on the election, appointment, or removal of directors of the Company. Additionally, each share of Class B Common Stock will immediately become convertible into one share of Common Stock, at the option of the holder thereof, at any time following the earlier of (i) the expiration or early termination of applicable waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (“HSR Clearance”), required prior to such holder’s conversion of all such shares of Class B Common Stock, and (ii) to the extent HSR Clearance is not required prior to such holder’s conversion of such shares of Class B Common Stock, the date that such holder owns such shares of Class B Common Stock. Issuances of Common Stock Issuances of Common Stock other than as related to the exercise or vesting of share-based compensation awards includes: • In October 2022, the Company issued approximately 133 million shares of Common Stock for an aggregate purchase price of $1.2 billion as part of the State Farm Strategic Investment (as defined below). • In June 2022, the Company issued approximately 2 million shares of Common Stock as consideration for a business acquisition. • In December 2021, the Company issued approximately 70 million shares of Common Stock with a fair value of $529 million in connection with the ADT Solar Acquisition. Additionally, during 2022, the Company issued the Delayed Shares in connection with the ADT Solar Acquisition as discussed in Note 4 “Acquisitions and Disposition.” • In January 2020, the Company issued approximately 16 million shares of Common Stock with a fair value of $114 million in connection with the Defenders Acquisition. Issuance of Class B Common Stock In September 2020, the Company issued and sold 54,744,525 shares of Class B Common Stock for an aggregate purchase price of $450 million to Google LLC (“Google”) in a private placement pursuant to a securities purchase agreement dated July 31, 2020 (the “Securities Purchase Agreement”). In connection with the issuance of the Class B Common Stock, the Company and Google entered into an Investor Rights Agreement (the “Google Investor Rights Agreement”), pursuant to which Google agreed to be bound by customary transfer restrictions and drag-along rights, and be afforded customary registration rights with respect to shares of Class B Common Stock held directly by Google. Under the terms of the Google Investor Rights Agreement, Google is prohibited, subject to certain exceptions, from transferring any shares of Class B Common Stock or any shares of Common Stock issuable upon conversion of the Class B Common Stock beneficially owned by Google until the earlier of (i) the three-year anniversary of issuance, (ii) the date on which the Google Commercial Agreement (as defined in Note 13 “Commitments and Contingencies”) has been terminated under certain specified circumstances, and (iii) September 30, 2022 if the Company breaches certain of its obligations under the Google Commercial Agreement. The Company estimated the fair value of the issued Class B Common Stock to be approximately $450 million, which represents a Level 3 fair value measurement. The estimation of the fair value included the following inputs: (i) the price per share of Common Stock; (ii) the length of the holding period restriction; (iii) an expected dividend-yield of 1.5% during the holding period restriction, which was based on the projected dividend run-rate and dividing by the stock price; and (iv) an expected share price volatility of 30% during the holding period restriction period, which was implied based upon an average of historical volatility of publicly traded companies in industries similar to the Company, as the Company did not have sufficient trading history to use as a basis for actual stock price volatility, as well as consideration for the Company’s debt-to-equity ratio. The intrinsic value of the contingently exercisable beneficial conversion feature related to the ability to convert Class B Common Stock to Common Stock as well as the fair value of Google’s option to purchase additional shares of Class B Common Stock were not material. State Farm Strategic Investment and Tender Offer State Farm Strategic Investment On September 5, 2022, the Company entered into a securities purchase agreement (the “State Farm Securities Purchase Agreement”) with State Farm, pursuant to which the Company agreed to issue and sell in a private placement to State Farm 133 million shares of the Company’s Common Stock (the “State Farm Shares”) at a per share price of $9.00 for an aggregate purchase price of $1.2 billion (the “State Farm Strategic Investment”). On September 12, 2022, in connection with the State Farm Strategic Investment, the Company commenced a tender offer to purchase up to 133 million shares of the Company’s Common Stock (including shares issued upon conversion of shares of Class B Common Stock ) (the “Tender Shares”) at a price of $9.00 per share (the “Tender Offer”) using proceeds from the State Farm Strategic Investment. The State Farm Strategic Investment closed on October 13, 2022 (the “Closing”), and the Company issued and sold the State Farm Shares at a price of $9.00 per share. After giving effect to the State Farm Strategic Investment and the Tender Offer, State Farm owned approximately 15% of the Company’s issued and outstanding Common Stock (assuming conversion of Class B Common Stock), and as a result, became a related party at the Closing. Tender Offer Concurrently with the execution of the State Farm Securities Purchase Agreement, (i) Apollo delivered to the Company a Tender and Support Agreement, pursuant to which Apollo agreed to collectively tender (and not withdraw) no fewer than 133 million shares of Common Stock in the Tender Offer (the “Apollo Support Agreement”), and (ii) Google delivered to the Company a Support Agreement, pursuant to which Google agreed to not convert and tender any of its shares of Class B Common Stock. The Tender Offer was considered a contingent forward purchase contract (the “Forward Contract”), which was recorded at fair value in the Consolidated Balance Sheet. The fair value of the Forward Contract was estimated as the difference between the present value of the cash consideration to be paid and the value of the Company’s Common Stock to be tendered. At the commencement of the Tender Offer, the Company recorded a liability and a reduction to additional paid in capital of $42 million. The change in fair value from inception through December 31, 2022 recognized in other income (expense) was a net loss of $63 million. Fees associated with the Tender Offer were not material for the year ended December 31, 2022. The Tender Offer expired on October 20, 2022. On October 26, 2022, the Company used proceeds from the State Farm Strategic Investment to repurchase an aggregate of 133 million shares of the Company’s Common Stock at a purchase price of $9.00 per share for an aggregate purchase price of $1.2 billion, excluding fees and expenses, subject to the terms and conditions described in the Offer to Purchase dated September 12, 2022 (as amended from time to time, the “Offer to Purchase”). The Tender Shares were subject to the “odd lot” priority and proration provisions described in the Offer to Purchase as the Tender Offer was substantially over-subscribed. No shares of Class B Common Stock were converted and tendered in the Tender Offer. State Farm Investor Rights Agreement At the Closing, the Company and State Farm entered into an Investor Rights Agreement (the “State Farm Investor Rights Agreement”), pursuant to which the Board of Directors of the Company (the “Board”) increased its size by one director and appointed a designee of State Farm as a member of the Board. Pursuant to the terms of the State Farm Investor Rights Agreement, State Farm will also be bound by customary transfer and standstill restrictions and drag-along rights, and be afforded customary registration rights with respect to the State Farm Shares. In particular, State Farm (a) will be prohibited, subject to certain customary exceptions, from transferring any of the State Farm Shares until the earlier of (i) the three-year anniversary of the Closing and (ii) the date on which the State Farm Development Agreement has been validly terminated, other than in the event of termination by the Company for a material breach thereof by State Farm, and (b) will be subject to certain standstill restrictions, including that State Farm will be restricted from acquiring additional equity securities of the Company if such acquisition would result in State Farm (and its affiliates) acquiring beneficial ownership in excess of 18% of the issued and outstanding Common Stock, taking into account on an as-converted basis the issued and outstanding Class B Common Stock, until five In addition, under the terms of the State Farm Investor Rights Agreement, in the event that the Company proposes to issue and sell shares of Common Stock, Class B Common Stock, or other equity securities of the Company to certain homeowners’ insurance and reinsurance companies, State Farm will have a right of first refusal with respect to such proposed issuance and sale on the same terms and conditions (the “ROFR”). The ROFR will terminate upon the earliest to occur of (i) State Farm and its permitted transferees no longer collectively owning shares of Common Stock equal to at least 50% of the State Farm Shares; (ii) the termination of the State Farm Development Agreement by the Company for a material breach by State Farm; and (iii) to the extent that the State Farm Development Agreement does not remain in effect on such date, the five State Farm Development Agreement At the Closing, the Company, ADT LLC (an indirect wholly owned subsidiary of the Company), and State Farm entered into the State Farm Development Agreement pursuant to which State Farm committed up to $300 million to an Opportunity Fund that will fund certain product and technology innovation, customer growth, and marketing initiatives to be agreed on between State Farm and the Company. Additionally at the Closing, the Company received $100 million of the Opportunity Fund, which will be restricted until such time as the Company uses the funds in accordance with the State Farm Development Agreement. The Company’s use of the funds is also subject to approval by State Farm. The Company recorded the cash received from the Opportunity Fund as restricted cash and a corresponding liability, which is reflected in accrued expenses and other current liabilities as of December 31, 2022. Dividends Stockholders are entitled to receive dividends when, as, and if declared by the Company’s board of directors out of funds legally available for that purpose. (in thousands, except per share data) Common Stock Class B Common Stock Declaration Date Record Date Payment Date Per Share Aggregate Per Share Aggregate Year Ended December 31, 2022 3/1/22 3/17/22 4/4/22 $ 0.035 $ 29,842 $ 0.035 $ 1,916 5/5/22 6/16/22 7/5/22 0.035 30,028 0.035 1,916 8/4/22 9/15/22 10/4/22 0.035 30,112 0.035 1,916 11/3/22 12/15/22 1/4/23 0.035 30,189 0.035 1,916 Total $ 0.140 $ 120,171 $ 0.140 $ 7,664 Year Ended December 31, 2021 2/25/21 3/18/21 4/1/21 $ 0.035 $ 27,220 $ 0.035 $ 1,916 5/5/21 6/17/21 7/1/21 0.035 27,268 0.035 1,916 8/4/21 9/16/21 10/5/21 0.035 27,270 0.035 1,916 11/9/21 12/16/21 1/4/22 0.035 29,732 0.035 1,916 Total $ 0.140 $ 111,490 $ 0.140 $ 7,664 During 2020, the Company declared aggregate dividends of $0.14 per share on Common Stock ($108 million) and $0.07 per share on Class B Common Stock ($4 million). The amount of dividends settled in shares of Common Stock was not material. Subsequent Event - On February 28, 2023, the Company announced a dividend of $0.035 per share to holders of Common Stock and Class B Common Stock of record on March 16, 2023, which will be distributed on April 4, 2023. Accumulated Other Comprehensive Income (Loss) Refer to Note 8 “Derivative Financial Instruments” for AOCI reclassifications associated with cash flow hedges. Other changes in AOCI, which primarily relate to the Company’s defined benefit pension plans, were not material. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation | SHARE-BASED COMPENSATION The Company grants share-based compensation awards to participants under the 2016 Equity Incentive Plan (the “2016 Plan”) and the 2018 Omnibus Incentive Plan (the “2018 Plan”). Share-based compensation expense recognized in selling, general, and administrative expenses was as follows: Years Ended December 31, ( in thousands ) 2022 2021 2020 Share-based compensation expense $ 66,566 $ 61,237 $ 96,013 2016 Plan As of December 31, 2022, the Company is authorized to issue no more than approximately 5 million shares of Common Stock by the exercise or vesting of granted awards under the 2016 Plan. The Company does not expect to issue additional awards under the 2016 Plan. Unrecognized share-based compensation expense as of December 31, 2022 and share-based compensation expense during 2022, 2021, and 2020 for awards granted under the 2016 Plan were not material. Distributed Shares and Class B Unit Redemption In connection with the IPO, each holder of Class B awards (“Class B Units”), which were issued to certain participants by Ultimate Parent prior to the IPO, had their entire Class B interest in Ultimate Parent redeemed for the number of shares of the Company’s Common Stock (the “Distributed Shares”) that would have been distributed to such holder under the terms of Ultimate Parent’s operating agreement in a hypothetical liquidation on the date and price of the IPO (the “Class B Unit Redemption”). The Class B Unit Redemption resulted in a modification of the Class B Units, whereby each holder received both vested and unvested Distributed Shares in the same proportion as the holder’s vested and unvested Class B Units held immediately prior to the IPO. As a result of the Class B Unit Redemption, holders of Class B Units received a total of 20.6 million shares of the Company’s Common Stock, of which 50% were subject to the same vesting conditions under the Class B Unit Service Tranche (the “Distributed Shares Service Tranche”), which were subject to ratable service-based vesting over a five-year period, and 50% were subject to the same vesting conditions under the Class B Unit Performance Tranche (the “Distributed Shares Performance Tranche”), which were based on the achievement of certain investment return thresholds by Apollo. The Distributed Shares also have certain other restrictions pursuant to the terms and conditions of the Company’s Amended and Restated Management Investor Rights Agreement (the “MIRA”). The IPO triggered an acceleration of vesting of the unvested Distributed Shares Service Tranche causing them to become fully vested six months from the date of the IPO, which occurred in July 2018. The Company recorded share-based compensation expense on the Distributed Shares Performance Tranche on a straight-line basis over the derived service period of app roximately three years from the IPO date, as the vesting conditions were deemed probable following the consummation of the IPO. Share-based compensation expense associated with the Distributed Shares Performance Tranche during 2022, 2021, and 2020 was not material. The following table summarizes activity related to the Distributed Shares during 2022: Performance Tranche Number of Distributed Shares Weighted-Average Grant Fair Value Unvested as of December 31, 2021 9,503,668 $ 13.08 Vested — — Forfeited (180,182) 14.48 Unvested as of December 31, 2022 9,323,486 $ 13.05 2018 Plan In January 2018, the Company approved the 2018 Plan, which became effective upon consummation of the IPO. The 2018 Plan authorizes the issuance of no more than approximately 38 million shares of Common Stock by the exercise or vesting of granted awards, which are generally stock options and restricted stock units (“RSUs”). During 2019, the Company amended the 2018 Plan, which increased the number of authorized shares of Common Stock to be issued to approximately 88 million shares. The Company satisfies the exercise of options and the vesting of RSUs through the issuance of authorized but previously unissued shares of Common Stock. Awards issued under the 2018 Plan include retirement provisions that allow awards to continue to vest in accordance with the granted terms in its entirety or on a pro-rata basis when a participant reaches retirement eligibility, as long as 12 months of service have been provided since the date of grant. Accordingly, share-based compensation expense for service-based awards is recognized on a straight-line basis over the vesting period, or on an accelerated basis for retirement-eligible participants where applicable. The Company accounts for forfeitures as they occur. Additionally, RSUs entitle the holder to dividend equivalent units (“DEUs”), which are granted as additional RSUs and are subject to the same vesting and forfeiture conditions as the underlying RSUs. DEUs are charged against accumulated deficit when dividends are paid. In December 2019, the exercise price of all options under the 2018 Plan that were granted prior to the payment of a special dividend in 2019 were adjusted downward by $0.70 in accordance with plan provisions, which allow for adjustments to the exercise price of options upon the occurrence of certain events, such as changes in capital or operating structure. Top-up Options In connection with the Class B Unit Redemption in 2018, the Company granted 12.7 million options to holders of Class B Units (the “Top-up Options”). The Top-up Options have an exercise price equal to the IPO price per share of the Company’s Common Stock, as adjusted in accordance with 2018 Plan provisions, and a contractual term of ten years from the grant date. Similar to the vesting conditions outlined above for the Distributed Shares, the Top-up Options contain a tranche subject to service-based vesting (the “Top-up Options Service Tranche”) and a tranche subject to vesting based upon the achievement of certain investment return thresholds by Apollo (the “Top-up Options Performance Tranche”). Recipients of the Top-up Options received both vested and unvested Top-up Options in the same proportion as the vested and unvested Class B Units held immediately prior to the IPO and Class B Unit Redemption. The Top-up Options vesting conditions are the same as those attributable to the Distributed Shares, including the condition that accelerated vesting of the unvested options in the Top-up Options Service Tranche causing them to become fully vested six months from the IPO. Any shares of the Company’s Common Stock acquired upon exercise of the Top-up Options will be subject to the terms of the MIRA. The Company recorded share-based compensation expense associated with the Top-up Options Service Tranche on a straight-line basis over the requisite service period of six months from the IPO. Share-based compensation expense associated with the Top-up Options Performance Tranche was recognized on a straight-line basis over the derived service period of approximately three years from the IPO date and was not material during the periods presented. The following table summarizes activity related to the 2018 Plan Top-up Options: Service Tranche Performance Tranche Number of Top-up Options Weighted-Average Exercise Price Number of Top-up Options Weighted-Average Exercise Price Aggregate Intrinsic Value (a) (in thousands) Weighted-Average Remaining Contractual Term (Years) Outstanding as of December 31, 2021 5,974,369 $ 13.30 5,850,549 $ 13.30 Exercised — — — — Forfeited (19,115) 13.30 (135,488) 13.30 Outstanding as of December 31, 2022 5,955,254 $ 13.30 5,715,061 $ 13.30 — 5.0 Exercisable as of December 31, 2022 5,955,254 $ 13.30 — $ 13.30 — 5.0 ________________________ (a) The intrinsic value represents the amount by which the fair value of the Company’s Common Stock exceeds the option exercise price as of December 31, 2022. Options Options granted under the 2018 Plan are primarily service-based awards that vest over a three-year period from the date of grant, have an exercise price equal to the closing price per share of the Company’s Common Stock on the date of grant, as adjusted in accordance with 2018 Plan provisions, and have a contractual term of ten years from the date of grant. The Company did not grant any options during 2022 and 2021. During 2020, the grant date fair values of options granted under the 2018 Plan were determined using the Black-Scholes valuation approach with the following assumptions: Risk-free interest rate 0.51% - 1.40% Expected exercise term (years) 6 Expected dividend yield 2.2% - 2.7% Expected volatility 45% - 46% The risk-free interest rate was based on U.S. Treasury bonds with a zero-coupon rate. The Company did not have sufficient historical exercise data, and, as such, the Company estimated the expected exercise term based on factors such as vesting period, contractual period, and other share-based compensation awards with similar terms and conditions. The dividend yield was calculated by taking the annual dividend run-rate and dividing by the stock price at date of grant. The stock price volatility was implied based upon an average of historical volatility of publicly traded companies in industries similar to the Company, as the Company did not have sufficient trading history to use as a basis for actual stock price volatility, as well as consideration for the Company’s debt-to-equity ratio. The weighted-average grant date fair values of options granted during 2020 was $1.77. The following table summarizes activity related to 2018 Plan options during 2022: Number of Options Weighted-Average Exercise Price Aggregate Intrinsic Value (a) (in thousands) Weighted-Average Remaining Contractual Term (Years) Outstanding as of December 31, 2021 21,465,818 $ 6.64 Granted — — Exercised (2,984,552) 5.39 Forfeited (515,640) 11.23 Outstanding as of December 31, 2022 17,965,626 $ 6.67 $ 52,245 6.3 Exercisable as of December 31, 2022 14,515,244 $ 6.73 $ 43,134 6.2 ________________________ (a) The intrinsic value represents the amount by which the fair value of the Company’s Common Stock exceeds the option exercise price as of December 31, 2022. Share-based compensation expense associated with options granted under the 2018 Plan was $7 million, $12 million, and $16 million during 2022, 2021, and 2020, respectively. The cash flow and the intrinsic value of options exercised were not material during 2022, 2021, and 2020. As of December 31, 2022, unrecognized compensation cost related to options was not material. Restricted Stock Units RSUs granted under the 2018 Plan are primarily service-based awards with a three-year graded vesting period from the date of grant. The fair value is equal to the closing price per share of the Company’s Common Stock on the date of grant. The following table summarizes activity related to the 2018 Plan RSUs (including DEUs) during 2022: Number of RSUs Weighted-Average Grant Date Fair Value Unvested as of December 31, 2021 15,544,846 $ 6.90 Granted 6,599,292 7.85 Vested (7,769,568) 6.76 Forfeited (1,219,161) 7.83 Unvested as of December 31, 2022 13,155,409 $ 7.38 Share-based compensation expense associated with RSUs granted under the 2018 Plan was $55 million, $46 million, and $39 million during 2022, 2021, and 2020, respectively. The fair value of RSUs (including DEUs) that vested and converted to shares of Common Stock on their respective vesting dates was approximately $59 million and $52 million during 2022 and 2021, respectively, and was not material during 2020. As of December 31, 2022, unrecognized compensation cost related to RSUs granted under the 2018 Plan was $38 million, which will be recognized over a period of 1.7 years. Other In June 2022, the Company granted 1.6 million performance share units (“PSUs”) in connection with a business combination that the Company will account for as share-based compensation. These PSUs contain both service and performance vesting conditions that must be met on an annual basis with the final vesting date in October 2025. The fair value of the PSUs is equal to the closing price per share of the Company’s Common Stock on the date of grant, which resulted in a weighted-average grant date fair value of $7.46. The PSUs are not entitled to dividend equivalent units. The impact from the PSUs was not material during 2022. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | NET INCOME (LOSS) PER SHARE The Company applies the two-class method for computing and presenting net income (loss) per share for each class of common stock, which allocates current period net income (loss) to each class of common stock and participating securities based on dividends declared and participation rights in the remaining undistributed earnings or losses. Basic net income (loss) per share is computed by dividing the net income (loss) allocated to each class of common stock by the related weighted-average number of shares outstanding during the period. Diluted net income (loss) per share gives effect to all securities representing potential common shares that were dilutive and outstanding during the period for each class of common stock and excludes potentially dilutive securities whose effect would have been anti-dilutive. Common Stock: Potential shares of Common Stock include (i) incremental shares related to the vesting or exercise of share-based compensation awards, warrants, and other options to purchase additional shares of the Company’s Common Stock calculated using the treasury stock method and (ii) incremental shares of Common Stock issuable upon the conversion of Class B Common Stock. Additionally, basic weighted-average shares outstanding for the year ended December 31, 2021 includes the Delayed Shares issued in connection with the ADT Solar Acquisition as discussed in Note 4 “Acquisitions and Disposition.” During 2021 and 2020, all potential shares of Common Stock that would be dilutive were excluded from the diluted net income (loss) per share of Common Stock computation because their effect would be anti-dilutive. As a result, basic net income (loss) per share of Common Stock is equal to diluted net income (loss) per share of Common Stock for those periods. Years Ended December 31, (in thousands, except per share amounts) 2022 2021 2020 Allocation of net income (loss) - basic $ 124,655 $ (318,062) $ (620,856) Dilutive effect (including conversion of Class B Common Stock) 7,690 — — Allocation of net income (loss) - diluted $ 132,345 $ (318,062) $ (620,856) Weighted-average shares outstanding - basic 848,465 770,620 760,483 Dilutive effect (including conversion of Class B Common Stock) 66,603 — — Weighted-average shares outstanding - diluted 915,068 770,620 760,483 Net income (loss) per share - basic $ 0.15 $ (0.41) $ (0.82) Net income (loss) per share - diluted $ 0.15 $ (0.41) $ (0.82) During 2021 and 2020, the potential shares of Common Stock that were excluded from the computation of diluted income (loss) per share of Common Stock were share-based compensation awards of approximately 61 million and 66 million, respectively, and all shares of Class B Common Stock. Additionally, the basic and diluted earnings per share computations for Common Stock exclude approximately 9 million, 10 million, and 10 million unvested shares during 2022, 2021, and 2020, respectively, as their vesting is contingent upon achievement of certain performance requirements which had not been met during the respective periods. Class B Common Stock: During 2022 and 2021, there were no potential shares of Class B Common Stock. During 2020, potential shares of Class B Common Stock included (i) incremental shares of Class B Common Stock calculated using the treasury stock method for the period in which the Securities Purchase Agreement was outstanding prior to closing and (ii) incremental shares of Class B Common Stock calculated using the treasury stock method for Google’s option to purchase additional shares of Class B Common Stock prior to closing. Years Ended December 31, (in thousands, except per share amounts) 2022 2021 2020 Allocation of net income (loss) - basic $ 8,008 $ (22,758) $ (11,337) Dilutive effect (24) — (1,952) Allocation of net income (loss) - diluted $ 7,984 $ (22,758) $ (13,289) Weighted-average shares outstanding - basic 54,745 54,745 15,855 Dilutive effect — — 2,089 Weighted-average shares outstanding - diluted 54,745 54,745 17,944 Net income (loss) per share - basic $ 0.15 $ (0.41) $ (0.72) Net income (loss) per share - diluted $ 0.15 $ (0.41) $ (0.74) |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Contractual Obligations The Company’s contractual obligations for goods or services entered into in the ordinary course of business, including agreements that are enforceable and legally binding and have a remaining term in excess of one year, primarily consist of information technology services and equipment, including investments in the Company’s information technology infrastructure and telecommunication services. The following table provides the Company’s contractual obligations as of December 31, 2022 (in thousands) : 2023 2024 2025 2026 2027 Thereafter Total $ 175,861 $ 67,286 $ 43,386 $ 24,826 $ 412 $ — $ 311,771 Google Commercial Agreement In July 2020, the Company and Google entered into a Master Supply, Distribution, and Marketing Agreement (the “Google Commercial Agreement”), pursuant to which Google has agreed to supply the Company with certain Google devices as well as certain Google video and analytics services (“Google Devices and Services”), for sale to the Company’s customers. Subject to customary termination rights related to breach and change of control, the Google Commercial Agreement has an initial term of seven years from the date that the Google Devices and Services are successfully integrated into the Company’s end-user security and automation platform. Further, subject to certain carve-outs, the Company has agreed to exclusively sell Google Devices and Services to its customers. In June 2022, the Company amended the Google Commercial Agreement to extend the date for the launch of the integrated Google Devices and Services until September 30, 2022. As of September 30, 2022, Google has the contractual right to require the Company, with certain exceptions, until such integration, to exclusively offer Google Devices and Services without integration for all new professional installations and for existing customers who do not have ADT Pulse or ADT Control interactive services. The Company has already begun providing Google video services and devices and will continue to do so on a non-integrated basis, and is working closely with Google toward an integrated solution. The Google Commercial Agreement also specifies that each party shall contribute $150 million towards the joint marketing of devices and services; customer acquisition; training of the Company’s employees for the sales, installation, customer service, and maintenance for the product and service offerings; and technology updates for products included in such offerings. Each party is required to contribute such funds in three equal tranches, subject to the attainment of certain milestones. The Company expects to contribute the majority of these amounts by the end of 2025, however, the timing of these contributions is still uncertain. In August 2022, the Company and Google further amended the Google Commercial Agreement (the “Google Commercial Agreement Amendment”), pursuant to which Google has agreed to commit an additional $150 million to fund growth, data and insights, product innovation and technology advancements, customer acquisition, and marketing, as mutually agreed by the Company and Google. The additional success funds will be funded in three equal tranches, subject to the attainment of certain milestones. Guarantees In the normal course of business, the Company is liable for contract completion and product performance. The Company’s guarantees primarily relate to standby letters of credit related to its insurance programs and totaled $93 million and $76 million as of December 31, 2022 and 2021, respectively. The Company does not believe such obligations will materially affect its financial position, results of operations, or cash flows. During March 2022, the Company entered into an unsecured Credit Agreement with Goldman Sachs Mortgage Company, as administrative agent and issuing lender (the “Issuing Lender”), together with other lenders party thereto, pursuant to which the Company may request the Issuing Lender to issue one or more letters of credit for its own account or the account of its subsidiaries, in an aggregate face amount not to exceed $75 million at any one time. Legal Proceedings The Company is subject to various claims and lawsuits in the ordinary course of business, which include among other things commercial general liability claims, automobile liability claims, contractual disputes, worker’s compensation claims, labor law and employment claims, claims related to alleged alarm system failures, claims that the Company infringed on the intellectual property of others, and consumer and employment class actions. The Company is also subject to regulatory and governmental examinations, information requests and subpoenas, inquiries, investigations, and threatened legal actions and proceedings. In connection with such formal and informal inquiries, the Company receives numerous requests, subpoenas, and orders for documents, testimony, and information in connection with various aspects of its activities. The Company records accruals for losses that are probable and reasonably estimable. These accruals are based on a variety of factors such as judgment, probability of loss, opinions of internal and external legal counsel, and actuarially determined estimates of claims incurred but not yet reported based upon historical claims experience. Legal costs in connection with claims and lawsuits in the ordinary course of business are expensed as incurred. Additionally, the Company records insurance recovery receivables from third-party insurers when recovery has been determined to be probable. The Company has not accrued for any contingent liabilities for which the likelihood of loss cannot be determined, is less than probable, or for which the range of potential loss cannot be reasonably estimated. As of December 31, 2022 and 2021, the Company’s accrual for ongoing claims and lawsuits within the scope of an insurance program totaled approximately $90 million for both periods respectively. The Company’s accrual related to ongoing claims and lawsuits not within the scope of an insurance program is not material. Unauthorized Access by a Former Technician In April 2020, after investigating a customer inquiry, the Company self-disclosed that a former technician based in Dallas, Texas had, during service visits, added his personal email address to certain of the Company’s customers’ accounts, which provided this employee with varying levels of unauthorized personal access to such customers’ in-home security systems. As of December 31, 2022, the Company and its insurers had settled all material pending lawsuits, arbitrations, and demands arising from this incident. All such pending settlements and agreements are for monetary amounts within the Company’s insured levels. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | LEASES Company as Lessee As part of normal operations, the Company leases real estate, vehicles, and equipment from various counterparties with lease terms and maturities through 2034. For these transactions, the Company applies the practical expedient to not separate the lease and non-lease components and accounts for the combined component as a lease. Additionally, the Company’s right-of-use assets and lease liabilities include leases with initial lease terms of 12 months or less. The Company’s right-of-use assets and lease liabilities primarily represent lease payments that are fixed at the commencement of a lease and variable lease payments that are dependent on an index or rate. Lease payments are recognized as lease cost on a straight-line basis over the lease term, which is determined as the non-cancelable period, including periods in which termination options are reasonably certain of not being exercised and periods in which renewal options are reasonably certain of being exercised. The discount rate is determined using the Company’s incremental borrowing rate coinciding with the lease term at the commencement of a lease. The incremental borrowing rate is estimated based on publicly available data for the Company’s debt instruments and other instruments with similar characteristics. Lease payments that are neither fixed nor dependent on an index or rate and vary because of changes in usage or other factors are included in variable lease costs. Variable lease costs are recorded in the period in which the obligation is incurred and primarily relate to fuel, repair, and maintenance payments as they vary based on the usage of leased vehicles and buildings. The Company’s leases do not contain material residual value guarantees or restrictive covenants. The Company’s subleases are not material. Right-of-Use Assets and Lease Liabilities: (in thousands) December 31, Presentation and Classification: 2022 2021 Operating Current Prepaid expenses and other current assets $ 210 $ 230 Operating Non-current Other assets 128,455 125,945 Finance Non-current Property and equipment, net (1) 93,013 88,962 Total right-of-use assets $ 221,678 $ 215,137 Operating Current Accrued expenses and other current liabilities $ 28,696 $ 37,359 Finance Current Current maturities of long-term debt 48,512 38,730 Operating Non-current Other liabilities 116,823 99,734 Finance Non-current Long-term debt 46,376 54,350 Total lease liabilities $ 240,407 $ 230,173 _________________ (1) Finance right-of-use assets are recorded net of accumulated depreciation of approximately $106 million and $78 million as of December 31, 2022 and 2021, respectively. Lease Cost: Years Ended December 31, ( in thousands ) 2022 2021 2020 Operating lease cost $ 47,047 $ 48,078 $ 56,680 Finance lease cost: Amortization of right-of-use assets 43,627 29,269 24,509 Interest on lease liabilities 3,680 2,823 3,122 Variable lease costs 90,671 72,367 47,013 Total lease cost $ 185,025 $ 152,537 $ 131,324 Cash Flow and Supplemental Information: Years Ended December 31, ( in thousands ) 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases: Operating cash flows $ 47,708 $ 50,721 $ 56,235 Finance Leases: Operating cash flows $ 3,680 $ 2,823 $ 3,122 Financing cash flows $ 44,978 $ 32,123 $ 27,956 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 49,193 $ 21,203 $ 47,870 Finance leases $ 48,439 $ 46,920 $ 15,326 Lease Term and Discount Rate: December 31, 2022 2021 Weighted-average remaining lease term (years): Operating leases 5.4 4.2 Finance leases 2.8 2.8 Weighted-average discount rate: Operating leases 5.5 % 4.8 % Finance leases 4.5 % 3.7 % Maturity of Lease Liabilities: December 31, 2022 ( in thousands ) Operating Leases Finance Leases 2023 $ 33,049 $ 44,629 2024 36,235 31,050 2025 29,518 19,370 2026 23,519 5,332 2027 15,956 714 Thereafter 36,115 — Total lease payments (including interest) $ 174,392 $ 101,095 Less interest 28,873 6,207 Total $ 145,519 $ 94,888 Company as Lessor The Company is a lessor in certain Company-owned transactions as the Company has identified a lease component associated with the right-of-use of the security system and a non-lease component associated with the monitoring and related services. For transactions in which (i) the timing and pattern of transfer is the same for the lease and non-lease components, and (ii) the lease component would be classified as an operating lease if accounted for separately, the Company applies the practical expedient to aggregate the lease and non-lease components and accounts for the combined transaction based upon its predominant characteristic, which is the non-lease component. The Company accounts for the combined component as a single performance obligation under the applicable revenue guidance, and recognizes the underlying assets within subscriber system assets, net, in the Consolidated Balance Sheets. |
Leases | LEASES Company as Lessee As part of normal operations, the Company leases real estate, vehicles, and equipment from various counterparties with lease terms and maturities through 2034. For these transactions, the Company applies the practical expedient to not separate the lease and non-lease components and accounts for the combined component as a lease. Additionally, the Company’s right-of-use assets and lease liabilities include leases with initial lease terms of 12 months or less. The Company’s right-of-use assets and lease liabilities primarily represent lease payments that are fixed at the commencement of a lease and variable lease payments that are dependent on an index or rate. Lease payments are recognized as lease cost on a straight-line basis over the lease term, which is determined as the non-cancelable period, including periods in which termination options are reasonably certain of not being exercised and periods in which renewal options are reasonably certain of being exercised. The discount rate is determined using the Company’s incremental borrowing rate coinciding with the lease term at the commencement of a lease. The incremental borrowing rate is estimated based on publicly available data for the Company’s debt instruments and other instruments with similar characteristics. Lease payments that are neither fixed nor dependent on an index or rate and vary because of changes in usage or other factors are included in variable lease costs. Variable lease costs are recorded in the period in which the obligation is incurred and primarily relate to fuel, repair, and maintenance payments as they vary based on the usage of leased vehicles and buildings. The Company’s leases do not contain material residual value guarantees or restrictive covenants. The Company’s subleases are not material. Right-of-Use Assets and Lease Liabilities: (in thousands) December 31, Presentation and Classification: 2022 2021 Operating Current Prepaid expenses and other current assets $ 210 $ 230 Operating Non-current Other assets 128,455 125,945 Finance Non-current Property and equipment, net (1) 93,013 88,962 Total right-of-use assets $ 221,678 $ 215,137 Operating Current Accrued expenses and other current liabilities $ 28,696 $ 37,359 Finance Current Current maturities of long-term debt 48,512 38,730 Operating Non-current Other liabilities 116,823 99,734 Finance Non-current Long-term debt 46,376 54,350 Total lease liabilities $ 240,407 $ 230,173 _________________ (1) Finance right-of-use assets are recorded net of accumulated depreciation of approximately $106 million and $78 million as of December 31, 2022 and 2021, respectively. Lease Cost: Years Ended December 31, ( in thousands ) 2022 2021 2020 Operating lease cost $ 47,047 $ 48,078 $ 56,680 Finance lease cost: Amortization of right-of-use assets 43,627 29,269 24,509 Interest on lease liabilities 3,680 2,823 3,122 Variable lease costs 90,671 72,367 47,013 Total lease cost $ 185,025 $ 152,537 $ 131,324 Cash Flow and Supplemental Information: Years Ended December 31, ( in thousands ) 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases: Operating cash flows $ 47,708 $ 50,721 $ 56,235 Finance Leases: Operating cash flows $ 3,680 $ 2,823 $ 3,122 Financing cash flows $ 44,978 $ 32,123 $ 27,956 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 49,193 $ 21,203 $ 47,870 Finance leases $ 48,439 $ 46,920 $ 15,326 Lease Term and Discount Rate: December 31, 2022 2021 Weighted-average remaining lease term (years): Operating leases 5.4 4.2 Finance leases 2.8 2.8 Weighted-average discount rate: Operating leases 5.5 % 4.8 % Finance leases 4.5 % 3.7 % Maturity of Lease Liabilities: December 31, 2022 ( in thousands ) Operating Leases Finance Leases 2023 $ 33,049 $ 44,629 2024 36,235 31,050 2025 29,518 19,370 2026 23,519 5,332 2027 15,956 714 Thereafter 36,115 — Total lease payments (including interest) $ 174,392 $ 101,095 Less interest 28,873 6,207 Total $ 145,519 $ 94,888 Company as Lessor The Company is a lessor in certain Company-owned transactions as the Company has identified a lease component associated with the right-of-use of the security system and a non-lease component associated with the monitoring and related services. For transactions in which (i) the timing and pattern of transfer is the same for the lease and non-lease components, and (ii) the lease component would be classified as an operating lease if accounted for separately, the Company applies the practical expedient to aggregate the lease and non-lease components and accounts for the combined transaction based upon its predominant characteristic, which is the non-lease component. The Company accounts for the combined component as a single performance obligation under the applicable revenue guidance, and recognizes the underlying assets within subscriber system assets, net, in the Consolidated Balance Sheets. |
Lessee | LEASES Company as Lessee As part of normal operations, the Company leases real estate, vehicles, and equipment from various counterparties with lease terms and maturities through 2034. For these transactions, the Company applies the practical expedient to not separate the lease and non-lease components and accounts for the combined component as a lease. Additionally, the Company’s right-of-use assets and lease liabilities include leases with initial lease terms of 12 months or less. The Company’s right-of-use assets and lease liabilities primarily represent lease payments that are fixed at the commencement of a lease and variable lease payments that are dependent on an index or rate. Lease payments are recognized as lease cost on a straight-line basis over the lease term, which is determined as the non-cancelable period, including periods in which termination options are reasonably certain of not being exercised and periods in which renewal options are reasonably certain of being exercised. The discount rate is determined using the Company’s incremental borrowing rate coinciding with the lease term at the commencement of a lease. The incremental borrowing rate is estimated based on publicly available data for the Company’s debt instruments and other instruments with similar characteristics. Lease payments that are neither fixed nor dependent on an index or rate and vary because of changes in usage or other factors are included in variable lease costs. Variable lease costs are recorded in the period in which the obligation is incurred and primarily relate to fuel, repair, and maintenance payments as they vary based on the usage of leased vehicles and buildings. The Company’s leases do not contain material residual value guarantees or restrictive covenants. The Company’s subleases are not material. Right-of-Use Assets and Lease Liabilities: (in thousands) December 31, Presentation and Classification: 2022 2021 Operating Current Prepaid expenses and other current assets $ 210 $ 230 Operating Non-current Other assets 128,455 125,945 Finance Non-current Property and equipment, net (1) 93,013 88,962 Total right-of-use assets $ 221,678 $ 215,137 Operating Current Accrued expenses and other current liabilities $ 28,696 $ 37,359 Finance Current Current maturities of long-term debt 48,512 38,730 Operating Non-current Other liabilities 116,823 99,734 Finance Non-current Long-term debt 46,376 54,350 Total lease liabilities $ 240,407 $ 230,173 _________________ (1) Finance right-of-use assets are recorded net of accumulated depreciation of approximately $106 million and $78 million as of December 31, 2022 and 2021, respectively. Lease Cost: Years Ended December 31, ( in thousands ) 2022 2021 2020 Operating lease cost $ 47,047 $ 48,078 $ 56,680 Finance lease cost: Amortization of right-of-use assets 43,627 29,269 24,509 Interest on lease liabilities 3,680 2,823 3,122 Variable lease costs 90,671 72,367 47,013 Total lease cost $ 185,025 $ 152,537 $ 131,324 Cash Flow and Supplemental Information: Years Ended December 31, ( in thousands ) 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases: Operating cash flows $ 47,708 $ 50,721 $ 56,235 Finance Leases: Operating cash flows $ 3,680 $ 2,823 $ 3,122 Financing cash flows $ 44,978 $ 32,123 $ 27,956 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 49,193 $ 21,203 $ 47,870 Finance leases $ 48,439 $ 46,920 $ 15,326 Lease Term and Discount Rate: December 31, 2022 2021 Weighted-average remaining lease term (years): Operating leases 5.4 4.2 Finance leases 2.8 2.8 Weighted-average discount rate: Operating leases 5.5 % 4.8 % Finance leases 4.5 % 3.7 % Maturity of Lease Liabilities: December 31, 2022 ( in thousands ) Operating Leases Finance Leases 2023 $ 33,049 $ 44,629 2024 36,235 31,050 2025 29,518 19,370 2026 23,519 5,332 2027 15,956 714 Thereafter 36,115 — Total lease payments (including interest) $ 174,392 $ 101,095 Less interest 28,873 6,207 Total $ 145,519 $ 94,888 Company as Lessor The Company is a lessor in certain Company-owned transactions as the Company has identified a lease component associated with the right-of-use of the security system and a non-lease component associated with the monitoring and related services. For transactions in which (i) the timing and pattern of transfer is the same for the lease and non-lease components, and (ii) the lease component would be classified as an operating lease if accounted for separately, the Company applies the practical expedient to aggregate the lease and non-lease components and accounts for the combined transaction based upon its predominant characteristic, which is the non-lease component. The Company accounts for the combined component as a single performance obligation under the applicable revenue guidance, and recognizes the underlying assets within subscriber system assets, net, in the Consolidated Balance Sheets. |
Retirement Plans
Retirement Plans | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Retirement Plans | RETIREMENT PLANS Defined Contribution Plans The Company maintains qualified defined contribution plans, which include 401(k) matching programs. Expense for the defined contribution plans is computed as a percentage of participants’ compensation and was $47 million, $45 million, and $40 million during 2022, 2021, and 2020, respectively. Multi-employer Plans The Company participates in certain multi-employer union pension plans, which provide benefits for a group of the Company’s unionized employees. The Company does not believe these multi-employer plans, including the Company’s required contributions and any underfunded liabilities under such plans, are material to the Company’s consolidated financial statements. Defined Benefit Plans The Company provides a defined benefit pension plan and certain other postretirement benefits to certain employees. These plans are frozen and are not material to the Company’s consolidated financial statements. As of December 31, 2022 and 2021, the fair values of pension plan assets were $49 million and $71 million, respectively, and the fair values of projected benefit obligations were $56 million and $75 million, respectively. As a result, the plans were underfunded by approximately $7 million and $4 million as of December 31, 2022 and 2021, respectively, and were recorded as a net liability. Net periodic benefit cost associated with these plans was not material during 2022, 2021, and 2020. In February 2021, the Company purchased annuity contracts for a certain class of pensioners and beneficiaries which settled a portion of the projected benefit obligation and is not material to the Company’s consolidated financial statements. Deferred Compensation Plan The Company maintains a non-qualified supplemental savings and retirement plan, which permits eligible employees to defer a portion of their compensation. Deferred compensation liabilities are reflected in other liabilities and were $27 million and $32 million as of December 31, 2022 and 2021, respectively. Deferred compensation expense was not material during 2022, 2021, and 2020. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS The Company’s related party transactions primarily relate to products and services received from, or monitoring and related services provided to, other entities affiliated with Apollo, as well as, from time to time, management, consulting, and transaction advisory services provided by Apollo to the Company. There were no significant related party transactions during the periods presented other than as described below. Apollo There were no significant related party transactions with Apollo during 2022, 2021, and 2020, respectively. Upon initial funding of the Term Loan A Facility, the Company will owe fees to Apollo, which are not expected to be material, related to Apollo’s performance of placement agent services related to such debt. State Farm As discussed in Note 10 “Equity,” in October 2022, State Farm became a related party in connection with the State Farm Strategic Investment. Other than as related to the State Farm Strategic Investment and State Farm Development Agreement, there were no significant related party transactions with State Farm during 2022. Canopy Canopy is considered a related party under GAAP, as the Company accounts for its investment under the equity method of accounting. Except for the transactions described in Note 5 “Equity Method Investments,” there were no other significant related party transactions with Canopy during 2022. Sunlight Financial LLC ADT Solar uses Sunlight Financial LLC (“Sunlight”), an entity affiliated with Apollo, to access certain loan products for ADT Solar customers, as discussed in Note 2 “Revenue and Receivables.” Total loans funded by Sunlight were approximately $436 million for the year ended December 31, 2022. As of December 31, 2022, the Company may be required to repurchase approximately $56 million of such loans. Additionally, the Company incurred $54 million of financing fees for the year ended December 31, 2022. As of December 31, 2022, net amounts due to/from Sunlight were not significant. Amounts paid to Sunlight were not material for the year ended December 31, 2021. Rackspace During October 2020, the Company entered into a master services agreement with Rackspace US, Inc. (“Rackspace”), an entity affiliated with Apollo, for the provision of cloud storage, equipment, and services to facilitate the implementation of the Company’s cloud migration strategy for certain applications. The master services agreement includes a minimum purchase commitment of $50 million over a seven Other Transactions During 2022, the Company incurred fees with certain entities affiliated with Apollo including (i) $3.0 million for a digital customer experience partner; (ii) $2.7 million for certain technical services encompassing the purchase and support of IT equipment; and (iii) $2.2 million for certain technology and communications services. |
Condensed Financial Information
Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of Registrant | CONDENSED FINANCIAL INFORMATION OF REGISTRANT ADT INC. (PARENT COMPANY ONLY) CONDENSED BALANCE SHEETS (in thousands) December 31, 2022 2021 Assets Current assets: Cash and cash equivalents $ 14,639 $ 1,947 Total current assets 14,639 1,947 Investment in subsidiaries and other assets 4,036,420 3,850,198 Total assets $ 4,051,059 $ 3,852,145 Liabilities and stockholders' equity Current liabilities: Dividends payable and other current liabilities $ 34,424 $ 47,482 Total current liabilities 34,424 47,482 Long-term debt 536,495 527,098 Other liabilities 86,992 28,846 Total liabilities 657,911 603,426 Total stockholders' equity 3,393,148 3,248,719 Total liabilities and stockholders' equity $ 4,051,059 $ 3,852,145 The accompanying notes are an integral part of these condensed financial statements ADT INC. (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (in thousands, except per share data) Years Ended December 31, 2022 2021 2020 Selling, general, and administrative expenses $ 2,583 $ 117 $ 807 Merger, restructuring, integration, and other (6,011) (1,444) 4,532 Operating income (loss) (3,428) (1,327) 5,339 Interest expense, net (8,086) (8,743) (8,342) Other income (expense) (63,394) — — Equity in net income (loss) of subsidiaries 200,715 (333,404) (618,512) Net income (loss) 132,663 (340,820) (632,193) Other comprehensive income (loss), net of tax 21,773 49,642 (60,239) Comprehensive income (loss) $ 154,436 $ (291,178) $ (692,432) Net income (loss) per share - basic: Common stock $ 0.15 $ (0.41) $ (0.82) Class B common stock $ 0.15 $ (0.41) $ (0.72) Weighted-average shares outstanding - basic: Common stock 848,465 770,620 760,483 Class B common stock 54,745 54,745 15,855 Net income (loss) per share - diluted: Common stock $ 0.15 $ (0.41) $ (0.82) Class B common stock $ 0.15 $ (0.41) $ (0.74) Weighted-average shares outstanding - diluted: Common stock 915,068 770,620 760,483 Class B common stock 54,745 54,745 17,944 The accompanying notes are an integral part of these condensed financial statements ADT INC. (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF CASH FLOWS (in thousands) Years Ended December 31, 2022 2021 2020 Cash flows from operating activities: Net income (loss) $ 132,663 $ (340,820) $ (632,193) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Equity in net (income) loss of subsidiaries (200,715) 333,404 618,512 Change in fair value of other financial instruments 63,396 — — Other, net 49,470 24,391 30,687 Net cash provided by (used in) operating activities 44,814 16,975 17,006 Cash flows from investing activities: Contributions to subsidiaries — (40,000) (275,000) Distributions from subsidiaries 118,200 8,700 260,852 Acquisition of businesses — — (201,453) Other investing, net — — 750 Net cash provided by (used in) investing activities 118,200 (31,300) (214,851) Cash flows from financing activities: Proceeds from issuance of common stock, net of expenses 1,180,000 — 447,811 Dividends on common stock (127,125) (116,348) (109,328) Repurchases of common stock (1,200,000) — (4) Other financing, net (3,197) (6,472) (1,896) Net cash provided by (used in) financing activities (150,322) (122,820) 336,583 Cash and cash equivalents and restricted cash and restricted cash equivalents: Net increase (decrease) during the period 12,692 (137,145) 138,738 Beginning balance 1,947 139,092 354 Ending balance $ 14,639 $ 1,947 $ 139,092 Supplementary cash flow information: Issuance of shares for acquisition of business $ 55,485 $ 528,503 $ 113,841 The accompanying notes are an integral part of these condensed financial statements Notes to Condensed Financial Statements (Parent Company Only) 1. Basis of Presentation The condensed financial statements of ADT Inc. have been prepared in accordance with Rule 12-04, Schedule I of Regulation S-X, as the restricted net assets of the subsidiaries of ADT Inc. (as defined in Rule 4-08(e)(3) of Regulation S-X) exceed 25% of the consolidated net assets of the Company. The ability of ADT Inc.’s operating subsidiaries to pay dividends may be restricted due to the terms of the subsidiaries’ First Lien Credit Agreement and the indentures governing other borrowings. The condensed financial statements of ADT Inc. have been prepared using the same accounting principles and policies described in the other notes to the consolidated financial statements with the only exception being that the parent company accounts for its subsidiaries using the equity method of accounting. These condensed financial statements should be read in conjunction with the Company’s consolidated financial statements and related notes thereto. 2. Transactions with Subsidiaries The majority of ADT Inc.’s transactions with its subsidiaries are related to (i) the receipt of distributions from subsidiaries in order to fund equity transactions, such as the payment of dividends and the repurchase of Common Stock; (ii) the contribution to subsidiaries of proceeds received from equity transactions; or (iii) the integration of business acquisitions into the Company’s organizational structure. During 2022, ADT Inc. made non-cash contributions to subsidiaries of approximately $82 million primarily related to the transfer of net assets of certain subsidiaries for share-based compensation. During 2021, ADT Inc. made non-cash contributions to subsidiaries of approximately $630 million related to the transfer of net assets of certain subsidiaries for the acquisition of ADT Solar, including $529 million in the issuance of shares, as well as, share-based compensation. During 2020, ADT Inc. acquired Defenders and Cell Bounce. In addition, ADT Inc. received a non-cash distribution of $43 million related to intangible assets from a subsidiary and made non-cash contributions to subsidiaries of approximately $434 million related to the transfer of net assets of certain subsidiaries and share-based compensation. |
Description of Business and S_2
Description of Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements have been prepared in U.S. dollars in accordance with generally accepted accounting principles in the United States of America (“GAAP”). Certain prior period amounts have been reclassified to conform with the current period presentation. The financial statements included herein comprise the consolidated results of ADT Inc. and its wholly-owned subsidiaries. The results of companies acquired are included from the effective date of each acquisition; and all intercompany transactions have been eliminated. The Company uses the equity method of accounting to account for an investment in which it has the ability to exercise significant influence but does not control. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in accordance with GAAP requires the Company to select accounting policies and make estimates that affect amounts reported in the consolidated financial statements and the accompanying notes. The Company’s estimates are based on the relevant information available at the end of each period. Actual results could differ materially from these estimates under different assumptions or market conditions. The Company considered the on-going and pervasive economic impact of the coronavirus pandemic (the “COVID-19 Pandemic”) in the assessment of its financial position, results of operations, and cash flows, as well as certain accounting estimates, for the periods presented. The impact of the COVID-19 Pandemic was not material during the periods presented. However, the evolving and uncertain nature of the COVID-19 Pandemic, and its economic impact, as well as the evolving nature of the regulatory environment, could materially impact the Company’s estimates and financial results in future reporting periods. |
Segments | Segments The Company has three operating and reportable segments organized based on customer type: Consumer and Small Business (“CSB”), Commercial, and Solar. The Company’s segments are based on the manner in which the Company’s Chief Executive Officer, who is the chief operating decision maker (the “CODM”), evaluates performance and makes decisions about how to allocate resources. • CSB - The CSB segment primarily includes the sale, installation, servicing, and monitoring of integrated security and automation systems and other related offerings to owners and renters of residential properties, small business operators, and other individual consumers, as well as general corporate costs and other income and expense items not included in another segment. • Commercial - The Commercial segment primarily includes the sale, installation, servicing, and monitoring of integrated security and automation systems, fire detection and suppression systems, and other related offerings to larger businesses and/or multi-site operations, which often require more sophisticated integrated solutions, as well as certain dedicated corporate and other costs. • Solar - The Solar segment primarily includes the sale and installation of solar systems and related solutions and services to residential homeowners who purchase solar and energy storage solutions, energy efficiency upgrades, and roofing services, as well as certain dedicated corporate and other costs. As discussed in Note 1 “Description of Business and Summary of Significant Accounting Policies,” the Company reports results in three operating and reportable segments. The Company organizes its segments based on customer type as follows: • CSB - The CSB segment primarily includes (i) revenue and operating costs from the sale, installation, servicing, and monitoring of integrated security and automation systems, as well as other related offerings; (ii) other operating costs associated with support functions related to these operations; and (iii) general corporate costs and other income and expense items not included in the Commercial and Solar segments. Customers in the CSB segment are comprised of owners and renters of residential properties, small business operators, and other individual consumers. • Commercial - The Commercial segment primarily includes (i) revenue and operating costs from the sale, installation, servicing, and monitoring of integrated security and automation systems, fire detection and suppression systems, and other related offerings; (ii) other operating costs associated with support functions related to these operations; and (iii) certain dedicated corporate costs and other income and expense items. Customers in the Commercial segment are comprised of larger businesses with more expansive facilities (typically larger than 10,000 square feet) and/or multi-site operations, which often require more sophisticated integrated solutions. • Solar - The Solar segment primarily includes (i) revenue and operating costs from the sale and installation of solar and related solutions and services; (ii) other operating costs associated with support functions related to these operations; and (iii) certain dedicated corporate costs and other income and expense items. Customers in the Solar segment are comprised of residential homeowners who purchase solar and energy storage solutions, energy efficiency upgrades, and roofing services. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Reference Rate Reform - Financial Accounting Standards Board Accounting Standards Update (“ASU”) 2022-06 , Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, defers the sunset date of ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , from December 31, 2022 to December 31, 2024. These updates provide optional guidance for a limited period of time to ease the potential burden of accounting for reference rate reform. This guidance was effective upon issuance and did not have a material impact on the consolidated financial statements as of December 31, 2022. The Company will continue to evaluate this guidance. Other Accounting Pronouncements Vintage Disclosures for Financing Receivables - ASU 2022-02, Financial Instruments — Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures , requires reporting entities to disclose current-period gross write-offs by year of origination for financing receivables, among other requirements. This disclosure-only guidance is effective in the first quarter of 2023, and the Company will apply the guidance prospectively. Fair Value of Equity Investments - ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, states that an entity should not consider the contractual sale restriction when measuring the equity security’s fair value and introduces new disclosure requirements related to such equity securities. This guidance becomes effective January 1, 2024, and should be applied prospectively with any adjustments recognized in earnings and disclosed on the date of adoption. Early adoption is permitted. The Company is currently evaluating this guidance. Supplier Finance Program Obligations - ASU 2022-04, Liabilities — Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, requires that a reporting entity who is a buyer in a supplier finance program disclose qualitative and quantitative information about its supplier finance programs, including a roll-forward of the obligations. This guidance is effective in the first quarter of 2023, and should be applied retrospectively, except for the amendment on roll-forward information, which becomes effective January 1, 2024 (early adoption is permitted), and should be applied prospectively. The Company is currently evaluating the impact of this guidance on its disclosures. |
Cash and Cash Equivalents and Restricted Cash and Restricted Cash Equivalents | Cash and Cash Equivalents and Restricted Cash and Restricted Cash Equivalents All highly liquid investments with original maturities of three months or less from the time of purchase are considered to be cash equivalents. Restricted cash and restricted cash equivalents are restricted for a specific purpose and cannot be included in the general cash and cash equivalents account. |
Inventories, net | Inventories, net Inventories are primarily comprised of components and parts for the Company’s security and solar systems. The Company records inventory at the lower of cost and net realizable value. Inventories are presented net of an obsolescence reserve. |
Work-in-Progress | Work-in-Progress Work-in-progress is primarily comprised of certain costs incurred for installations of security system equipment sold outright to customers that have not yet been completed. |
Property and Equipment, net | Property and Equipment, net Property and equipment, net, is recorded at historical cost less accumulated depreciation, which is calculated using the straight-line method over the estimated useful lives of the related assets. Depreciation expense is reflected in depreciation and intangible asset amortization. Repairs and maintenance expenditures are expensed when incurred. Useful Lives: Buildings and related improvements Up to 40 years Leasehold improvements Lesser of remaining term of the lease or economic useful life Capitalized software 3 to 10 years Machinery, equipment, and other Up to 10 years |
Subscriber System Assets, net and Deferred Subscriber Acquisition Costs, net | Subscriber System Assets, net and Deferred Subscriber Acquisition Costs, netSubscriber system assets represent capitalized equipment and installation costs incurred in connection with transactions in which the Company retains ownership of the security system |
Long-Lived Assets (excluding Goodwill and Other Indefinite-Lived Intangible Assets) | Long-Lived Assets (excluding Goodwill and Other Indefinite-Lived Intangible Assets)The Company reviews long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of an asset or asset group may not be fully recoverable. The Company groups assets at the lowest level for which cash flows are separately identified. Recoverability is measured by a comparison of the carrying amount of the asset group to its expected future undiscounted cash flows. If the expected future undiscounted cash flows of the asset group are less than its carrying amount, an impairment loss is recognized based on the amount by which the carrying amount exceeds the fair value less costs to sell. The calculation of the fair value less costs to sell of an asset group is based on assumptions concerning the amount and timing of estimated future cash flows and assumed discount rates, reflecting varying degrees of perceived risk. |
Advertising Costs | Advertising Costs Advertising costs are expensed when incurred. Advertising costs included in selling, general, and administrative expenses were $219 million, $239 million, and $264 million during 2022, 2021, and 2020, respectively. |
Radio Conversion Program | Radio Conversion Program During 2019, the Company commenced a program to replace the 3G and Code-Division Multiple Access (“CDMA”) cellular equipment used in many of its security systems prior to the cellular network providers retiring their 3G and CDMA networks during 2022. From inception of this program through December 31, 2022, the Company incurred $292 million of net radio conversion costs. The estimated remaining radio conversion costs and related incremental revenue are not expected to be material. |
Merger, Restructuring, Integration, and Other | Merger, Restructuring, Integration, and Other Merger, restructuring, integration, and other represents certain direct and incremental costs resulting from acquisitions made by the Company, integration costs as a result of those acquisitions, costs related to the Company’s restructuring efforts, as well as fair value remeasurements and impairment charges on certain strategic investments. |
Concentration of Credit Risks | Concentration of Credit Risks The majority of the Company’s cash and cash equivalents and restricted cash and restricted cash equivalents are held at major financial institutions. There is a concentration of credit risk related to certain account balances in excess of the Federal Deposit Insurance Corporation insurance limit of $250,000 per account. The Company regularly monitors the financial stability of these financial institutions and believes there is no exposure to any significant credit risk for its cash and cash equivalents and restricted cash and restricted cash equivalents. Concentration of credit risk associated with the majority of the Company’s receivables from customers is limited due to the significant size of the customer base. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments primarily consist of cash and cash equivalents, restricted cash and restricted cash equivalents, accounts receivable, retail installment contract receivables, accounts payable, debt, and derivative financial instruments. Due to their short-term and/or liquid nature, the fair values of cash, restricted cash, accounts receivable, and accounts payable approximate their respective carrying amounts. Cash Equivalents - Included in cash and cash equivalents and restricted cash and restricted cash equivalents, as applicable from time to time, are investments in money market mutual funds. These investments are generally classified as Level 1 fair value measurements, which represent unadjusted quoted prices in active markets for identical assets or liabilities. Investments in money market mutual funds were $145 million as of December 31, 2022, and were not material as of December 31, 2021. Retail Installment Contract Receivables, net - The fair values of the Company’s retail installment contract receivables are determined using a discounted cash flow model and are classified as Level 3 fair value measurements. |
Long-Term Debt Instrument | Long-Term Debt Instruments - The fair values of the Company’s debt instruments are determined using broker-quoted market prices, which represent quoted prices for similar assets or liabilities as well as other observable market data, and are classified as Level 2 fair value measurements. The carrying amounts of debt outstanding, if any, under the Company’s first lien revolving credit facility (the “First Lien Revolving Credit Facility”) and its uncommitted receivables securitization financing agreement (the “Receivables Facility”) approximate their fair values, as interest rates on these borrowings approximate current market rates. |
Derivative Financial Instruments | Derivative Financial Instruments - Derivative financial instruments are reported at fair value as either assets or liabilities. These fair values are primarily calculated using discounted cash flow models utilizing observable inputs, such as quoted forward interest rates, and incorporate credit risk adjustments to reflect the risk of default by the counterparty or the Company. The resulting fair values are classified as Level 2 fair value measurements. Refer to Note 8 “Derivative Financial Instruments” for the fair values of the Company’s derivative financial instruments. The Company's derivative financial instruments primarily consist of LIBOR-based interest rate swap contracts, which were entered into with the objective of managing exposure to variability in interest rates on the Company's debt. All interest rate swap contracts are reported in the Consolidated Balance Sheets at fair value. For interest rate swap contracts that are: • Not designated as cash flow hedges: Unrealized gains and losses are recognized in interest expense, net. • Designated as cash flow hedges: Unrealized gains and losses are recognized as a component of accumulated other comprehensive income (loss) (“AOCI”) and are reclassified into interest expense, net, in the same period in which the related interest on debt affects earnings. For interest rate swap contracts that have been de-designated as cash flow hedges and for which forecasted cash flows are: • Probable or reasonably possible of occurring: Unrealized gains and losses previously recognized as a component of AOCI are reclassified into interest expense, net, in the same period in which the related interest on variable-rate debt affects earnings through the original maturity date of the related interest rate swap contracts. • Probable of not occurring: Unrealized gains and losses previously recognized as a component of AOCI are immediately reclassified into interest expense, net. |
Revenue | Revenue The Company generates revenue through contractual monthly recurring fees received for monitoring and related services provided to customers, as well as the sale and installation of security, fire, and solar systems (referred to as “systems”). Revenue is recognized in the Consolidated Statements of Operations net of sales and other taxes. Amounts collected from customers for sales and other taxes are reported as a liability net of the related amounts remitted. When customers terminate a monitoring contract early, contract termination charges are assessed in accordance with the contract terms and are recognized in monitoring and related services revenue when collectability is probable. The Company allocates the transaction price to each performance obligation based on relative standalone selling price, which is determined using observable internal and external pricing, profitability, and operational metrics. For CSB and Commercial, the Company’s performance obligations generally include monitoring, related services (such as maintenance agreements), and the sale and installation of a security system in outright sales transactions or a material right in transactions in which the Company retains ownership of the security system. Substantially all new CSB transactions since March 2021 take place under a Company-owned model. For Solar, the Company’s performance obligations generally include the sale and installation of a solar system, and may include additional performance obligations such as roofing services or the sale and installation of additional products such as batteries. In February 2020, for certain residential customers, the Company (i) revised the amount and nature of fees due at installation, (ii) introduced a 60-month monitoring contract option, and (iii) introduced a retail installment contract option (as discussed below). |
Account Receivable | Accounts Receivable Accounts receivable represent unconditional rights to consideration from customers in the ordinary course of business and are generally due in one year or less. The Company’s accounts receivable are recorded at amortized cost less an allowance for credit losses not expected to be recovered. The allowance for credit losses is recognized at inception and reassessed each reporting period. The Company evaluates its allowance for credit losses on accounts receivable in pools based on customer type. For each customer pool, the allowance for credit losses is estimated based on the delinquency status of the underlying receivables and the related historical loss experience, as adjusted for current and expected future conditions, if applicable. The allowance for credit losses is not material for the individual pools of customers. |
Retail Installment Contract Receivables | Retail Installment Contract Receivables For security system transactions occurring under both Company-owned and customer-owned equipment models, the Company’s retail installment contract option allows qualifying residential customers to pay the fees due at installation over a 24-, 36-, or 60-month interest-free period. The financing component of retail installment contract receivables is not significant. Upon origination of a retail installment contract, the Company utilizes external credit scores to assess customer credit quality and determine eligibility. In addition, customers are required to enroll in the Company’s automated payment process in order to enter into a retail installment contract. Subsequent to origination, the Company monitors the delinquency status of retail installment contract receivables as the key credit quality indicator. As of December 31, 2022, the current and delinquent billed retail installment contract receivables were not material. The Company’s retail installment contract receivables are recorded at amortized cost less an allowance for credit losses not expected to be recovered. The allowance for credit losses is recognized at inception and reassessed each reporting period. The allowance for credit losses relates to retail installment contract receivables from outright sales transactions and is not material. |
Contract Assets | Contract Assets Contract assets represent the Company’s right to consideration in exchange for goods or services transferred to the customer. The contract asset is reclassified to accounts receivable as additional services are performed and billed, which is when the Company’s right to the consideration becomes unconditional. The Company has the right to bill customers as services are provided over time, which generally occurs over the course of a 24-, 36-, or 60-month period. The financing component of contract assets is not significant. The Company records an allowance for credit losses against its contract assets for amounts not expected to be recovered. The allowance is recognized at inception and is reassessed each reporting period. The allowance for credit losses on contract assets was not material for the periods presented. The Company recognized approximately $17 million, $26 million, and $183 million of gross contract assets during 2022, 2021, and 2020, respectively. |
Acquisitions and Disposition | From time to time, the Company may pursue business acquisitions that either strategically fit with the Company’s existing core business or expand the Company’s products and services into new and attractive adjacent markets. The Company accounts for business acquisitions under the acquisition method of accounting. The assets acquired and liabilities assumed in connection with business acquisitions are recorded at the date of acquisition at their estimated fair values, with any excess of the purchase price over the estimated fair values of the net assets acquired recorded as goodwill. Significant judgment is required in estimating the fair value of assets acquired and liabilities assumed and in assigning useful lives to certain definite-lived intangible and tangible assets. Accordingly, the Company may engage third-party valuation specialists to assist in these determinations. The fair value estimates are based on available information as of the acquisition date and on future expectations and assumptions deemed reasonable by management, but are inherently uncertain. Acquisition-related expenses are recognized as incurred and are included in merger, restructuring, integration, and other and were not material during 2022, 2021, and 2020. |
Contract and Related Customer Relationships | Contracts and Related Customer Relationships Contracts and related customer relationships comprise customer relationships that originated from business acquisitions as well as contracts with customers purchased under the ADT Authorized Dealer Program (as defined below) or from other third parties. Customer relationships acquired as part of business acquisitions, which primarily originated from the Formation Transactions and the ADT Acquisition, are amortized over a period of up to 20 years based on management estimates about the amounts and timing of estimated future revenue from customer accounts and average customer account life that existed at the time of the related business acquisition. Additionally, the Company maintains a network of agreements with third-party independent alarm dealers who sell alarm equipment and ADT Authorized Dealer-branded monitoring and interactive services to residential end users (the “ADT Authorized Dealer Program”). The dealers in this program generate new end-user contracts with customers which the Company has the right, but not the obligation, to purchase from the dealer. Purchases of contracts with customers under the ADT Authorized Dealer Program, or from other third parties, are considered asset acquisitions and are recognized based on the cost to acquire the assets, which may include cash consideration, non-cash consideration, contingent consideration, and directly-attributable transaction costs. The Company may charge back the purchase price of any end-user contract if the contract is canceled during the charge-back period, which is generally thirteen months from the date of purchase. The Company records the amount of the charge back as a reduction to the purchase price. |
Goodwill and Indefinite-Lived Intangible Assets Impairment | Goodwill and Indefinite-Lived Intangible Assets Impairment Goodwill and indefinite-lived intangible assets are not amortized and are tested for impairment at least annually as of the first day of the fourth quarter of each year and more often if an event occurs or circumstances change which indicate it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount. The Company may perform its impairment test for any reporting unit or indefinite-lived intangible asset through a qualitative assessment or elect to proceed directly to a quantitative impairment test, however, the Company may resume a qualitative assessment in any subsequent period if facts and circumstances permit. Goodwill Under a qualitative approach, the Company assesses whether it is more-likely-than-not that a reporting unit’s fair value is less than its carrying amount. If the Company elects to bypass the qualitative assessment for any reporting unit, or if a qualitative assessment indicates it is more-likely-than-not that the estimated fair value of a reporting unit is less than its carrying amount, the Company proceeds to a quantitative approach. Under a quantitative approach, the Company estimates the fair value of a reporting unit and compares it to its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company estimates the fair values of its reporting units using the income approach, which discounts projected cash flows using market participant assumptions. The income approach includes significant assumptions including, but not limited to, forecasted revenue, operating profit margins, Adjusted EBITDA margins, operating expenses, cash flows, perpetual growth rates, and discount rates. The estimated fair value of a reporting unit calculated using the income approach is sensitive to changes in the underlying assumptions. In developing these assumptions, the Company relies on various factors including operating results, business plans, economic projections, anticipated future cash flows, and other market data. Examples of events or circumstances that could reasonably be expected to negatively affect the underlying judgments and factors and ultimately impact the estimated fair value determinations may include such items as a prolonged downturn in the business environment, changes in economic conditions that significantly differ from the Company’s assumptions in timing or degree, volatility in equity and debt markets resulting in higher discount rates, and unexpected regulatory changes. As a result, there are inherent uncertainties related to these judgments and factors that may ultimately impact the estimated fair value determinations. Except as discussed below within the Solar reporting unit, the Company did not record any goodwill impairment losses during the periods presented. |
Indefinite-Lived Intangible Assets and Definite-Lived Intangible Asset Impairment | Indefinite-Lived Intangible Assets Under a qualitative approach, the impairment test for an indefinite-lived intangible asset consists of an assessment of whether it is more-likely-than-not that an asset’s fair value is less than its carrying amount. If the Company elects to bypass the qualitative assessment for any indefinite-lived intangible asset, or if a qualitative assessment indicates it is more-likely-than-not that the estimated carrying amount of such asset exceeds its fair value, the Company proceeds to a quantitative approach. Under a quantitative approach, the Company estimates the fair value of an asset and compares it to its carrying amount. If the carrying amount exceeds fair value, an impairment loss is recognized in an amount equal to that excess. The fair value of an indefinite-lived intangible asset is determined based on the nature of the underlying asset. The Company’s only indefinite-lived intangible asset is the ADT trade name. The fair value of the ADT trade name is determined under a relief from royalty method, which is an income approach that estimates the cost savings that accrue to the Company that it would otherwise have to pay in the form of royalties or license fees on revenue earned through the use of the asset. The utilization of the relief from royalty method requires the Company to make significant assumptions including revenue growth rates, the implied royalty rate, and the discount rate. As of October 1, 2022, the Company quantitatively tested the ADT trade name for impairment. Based on the results of the October 1, 2022 test, the Company did not record any impairment losses associated with the ADT trade name, and the estimated fair value of the trade name significantly exceeded its carrying amount. During 2021 and 2020, the Company did not record any impairment losses on its indefinite lived intangible assets. Definite-Lived Intangible Asset Impairment During the first quarter of 2021, the Company recognized $18 million in impairment losses on its other definite-lived intangible assets primarily due to lower than expected benefits from the Cell Bounce developed technology intangible asset, which is included in the CSB segment, as a result of the worldwide shortages for certain electronic components at that time. The fair value was determined using an income-based approach, and the loss is reflected in merger, restructuring, integration, and other. |
Income Taxes | The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the temporary differences between the recognition of revenue and expenses for income tax and financial reporting purposes and between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements. The Company records the effect of a tax rate or law change on the Company’s deferred tax assets and liabilities in the period of enactment. The valuation allowance for deferred tax assets relates to the uncertainty of the utilization of certain U.S. federal and state deferred tax assets. In evaluating the Company’s ability to recover its deferred tax assets, the Company considers all available positive and negative evidence, which includes its past operating results, the existence of cumulative losses in the most recent years, and its forecast of future taxable income. In estimating future taxable income, the Company develops assumptions related to the amount of future pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax planning strategies. These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates the Company is using to manage its underlying businesses. The Company believes that it is more-likely-than-not that it will generate sufficient future taxable income to realize its deferred tax assets, net of valuation allowance. The changes in the valuation allowance for deferred tax assets were as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Beginning balance $ (60,157) $ (68,013) $ (56,841) Income tax benefit (expense) 2,428 2,378 (11,999) Write-offs and other (1) 14 5,478 827 Ending balance $ (57,715) $ (60,157) $ (68,013) |
Unrecognized Tax Benefits | Unrecognized Tax Benefits The Company recognizes positions taken or expected to be taken in a tax return in the consolidated financial statements when it is more-likely-than-not (i.e., a likelihood of more than 50%) that the position would be sustained upon examination by tax authorities. A recognized tax position is then measured at the largest amount of benefit with greater than 50% likelihood of being realized upon ultimate settlement. The Company records liabilities for positions that have been taken but do not meet the more-likely-than-not recognition threshold. The Company adjusts the liabilities for unrecognized tax benefits in light of changing facts and circumstances; however, due to the complexity of some of these uncertainties, the ultimate resolution may result in a change to the estimated liabilities. The Company includes interest and penalties associated with unrecognized tax benefits as income tax expense and as a component of the recorded balance of unrecognized tax benefits, which is reflected in other liabilities, or net of related tax loss carryforwards in the Consolidated Balance Sheets. Interest and penalties associated with unrecognized tax benefits were not material to the Company's consolidated financial statements for the periods presented. |
Dividends | Dividends Stockholders are entitled to receive dividends when, as, and if declared by the Company’s board of directors out of funds legally available for that purpose. |
Share-Based Compensation | The Company grants share-based compensation awards to participants under the 2016 Equity Incentive Plan (the “2016 Plan”) and the 2018 Omnibus Incentive Plan (the “2018 Plan”). Share-based compensation expense recognized in selling, general, and administrative expenses In January 2018, the Company approved the 2018 Plan, which became effective upon consummation of the IPO. The 2018 Plan authorizes the issuance of no more than approximately 38 million shares of Common Stock by the exercise or vesting of granted awards, which are generally stock options and restricted stock units (“RSUs”). During 2019, the Company amended the 2018 Plan, which increased the number of authorized shares of Common Stock to be issued to approximately 88 million shares. The Company satisfies the exercise of options and the vesting of RSUs through the issuance of authorized but previously unissued shares of Common Stock. Awards issued under the 2018 Plan include retirement provisions that allow awards to continue to vest in accordance with the granted terms in its entirety or on a pro-rata basis when a participant reaches retirement eligibility, as long as 12 months of service have been provided since the date of grant. Accordingly, share-based compensation expense for service-based awards is recognized on a straight-line basis over the vesting period, or on an accelerated basis for retirement-eligible participants where applicable. The Company accounts for forfeitures as they occur. Additionally, RSUs entitle the holder to dividend equivalent units (“DEUs”), which are granted as additional RSUs and are subject to the same vesting and forfeiture conditions as the underlying RSUs. DEUs are charged against accumulated deficit when dividends are paid. In December 2019, the exercise price of all options under the 2018 Plan that were granted prior to the payment of a special dividend in 2019 were adjusted downward by $0.70 in accordance with plan provisions, which allow for adjustments to the exercise price of options upon the occurrence of certain events, such as changes in capital or operating structure. |
Net Income (Loss) Per Share | The Company applies the two-class method for computing and presenting net income (loss) per share for each class of common stock, which allocates current period net income (loss) to each class of common stock and participating securities based on dividends declared and participation rights in the remaining undistributed earnings or losses. Basic net income (loss) per share is computed by dividing the net income (loss) allocated to each class of common stock by the related weighted-average number of shares outstanding during the period. Diluted net income (loss) per share gives effect to all securities representing potential common shares that were dilutive and outstanding during the period for each class of common stock and excludes potentially dilutive securities whose effect would have been anti-dilutive. Common Stock: Potential shares of Common Stock include (i) incremental shares related to the vesting or exercise of share-based compensation awards, warrants, and other options to purchase additional shares of the Company’s Common Stock calculated using the treasury stock method and (ii) incremental shares of Common Stock issuable upon the conversion of Class B Common Stock. Additionally, basic weighted-average shares outstanding for the year ended December 31, 2021 includes the Delayed Shares issued in connection with the ADT Solar Acquisition as discussed in Note 4 “Acquisitions and Disposition.” During 2021 and 2020, all potential shares of Common Stock that would be dilutive were excluded from the diluted net income (loss) per share of Common Stock computation because their effect would be anti-dilutive. As a result, basic net income (loss) per share of Common Stock is equal to diluted net income (loss) per share of Common Stock for those periods. |
Leases | As part of normal operations, the Company leases real estate, vehicles, and equipment from various counterparties with lease terms and maturities through 2034. For these transactions, the Company applies the practical expedient to not separate the lease and non-lease components and accounts for the combined component as a lease. Additionally, the Company’s right-of-use assets and lease liabilities include leases with initial lease terms of 12 months or less. The Company’s right-of-use assets and lease liabilities primarily represent lease payments that are fixed at the commencement of a lease and variable lease payments that are dependent on an index or rate. Lease payments are recognized as lease cost on a straight-line basis over the lease term, which is determined as the non-cancelable period, including periods in which termination options are reasonably certain of not being exercised and periods in which renewal options are reasonably certain of being exercised. The discount rate is determined using the Company’s incremental borrowing rate coinciding with the lease term at the commencement of a lease. The incremental borrowing rate is estimated based on publicly available data for the Company’s debt instruments and other instruments with similar characteristics. Lease payments that are neither fixed nor dependent on an index or rate and vary because of changes in usage or other factors are included in variable lease costs. Variable lease costs are recorded in the period in which the obligation is incurred and primarily relate to fuel, repair, and maintenance payments as they vary based on the usage of leased vehicles and buildings. The Company’s leases do not contain material residual value guarantees or restrictive covenants. The Company’s subleases are not material. |
Leases | Company as Lessor The Company is a lessor in certain Company-owned transactions as the Company has identified a lease component associated with the right-of-use of the security system and a non-lease component associated with the monitoring and related services. For transactions in which (i) the timing and pattern of transfer is the same for the lease and non-lease components, and (ii) the lease component would be classified as an operating lease if accounted for separately, the Company applies the practical expedient to aggregate the lease and non-lease components and accounts for the combined transaction based upon its predominant characteristic, which is the non-lease component. The Company accounts for the combined component as a single performance obligation under the applicable revenue guidance, and recognizes the underlying assets within subscriber system assets, net, in the Consolidated Balance Sheets. |
Description of Business and S_3
Description of Business and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Restatement | The impacts from the restatement as of and for the year ended December 31, 2022 are as follows: Consolidated Balance Sheet: December 31, 2022 (in thousands) As Reported Adjustments As Restated Goodwill $ 5,818,605 $ (51,589) $ 5,767,016 Total assets $ 17,872,825 $ (51,589) $ 17,821,236 Deferred tax liabilities $ 904,628 $ (11,634) $ 892,994 Total liabilities $ 14,439,722 $ (11,634) $ 14,428,088 Accumulated deficit $ (3,909,624) $ (39,955) $ (3,949,579) Total stockholders' equity $ 3,433,103 $ (39,955) $ 3,393,148 Total liabilities and stockholders' equity $ 17,872,825 $ (51,589) $ 17,821,236 Consolidated Statement of Operations: Year Ended December 31, 2022 (in thousands, except per share amounts) As Reported Adjustments As Restated Goodwill impairment $ 149,385 $ 51,589 $ 200,974 Operating income (loss) $ 560,249 $ (51,589) $ 508,660 Income (loss) before income taxes and equity in net earnings (losses) of equity method investee $ 237,403 $ (51,589) $ 185,814 Income tax benefit (expense) $ (60,184) $ 11,634 $ (48,550) Income (loss) before equity in net earnings (losses) of equity method investee $ 177,219 $ (39,955) $ 137,264 Net income (loss) $ 172,618 $ (39,955) $ 132,663 Net income (loss) per share - basic: Common Stock $ 0.19 $ (0.04) $ 0.15 Class B Common Stock $ 0.19 $ (0.04) $ 0.15 Weighted-average shares outstanding - basic: Common Stock 848,465 — 848,465 Class B Common Stock 54,745 — 54,745 Net income (loss) per share - diluted: Common Stock $ 0.19 $ (0.04) $ 0.15 Class B Common Stock $ 0.19 $ (0.04) $ 0.15 Weighted-average shares outstanding - diluted: Common Stock 915,068 — 915,068 Class B Common Stock 54,745 — 54,745 Consolidated Statement of Comprehensive Income (Loss): Year Ended December 31, 2022 (in thousands) As Reported Adjustments As Restated Net income (loss) $ 172,618 $ (39,955) $ 132,663 Comprehensive income (loss) $ 194,391 $ (39,955) $ 154,436 Consolidated Statement of Stockholders’ Equity: Year Ended December 31, 2022 (in thousands) As Reported Adjustments As Restated Net income (loss) $ 172,618 $ (39,955) $ 132,663 Accumulated deficit $ (3,909,624) $ (39,955) $ (3,949,579) Total stockholders’ equity $ 3,433,103 $ (39,955) $ 3,393,148 Consolidated Statement of Cash Flows: Year Ended December 31, 2022 (in thousands) As Reported Adjustments As Restated Net income (loss) $ 172,618 $ (39,955) $ 132,663 Deferred income taxes $ 31,209 $ (11,634) $ 19,575 Goodwill, intangible, and other asset impairments $ 154,543 $ 51,589 $ 206,132 |
Schedule of Cash and Cash Equivalents | The following table reconciles the amounts below reported in the Consolidated Balance Sheets to the total of the same such amounts shown in the Consolidated Statements of Cash Flows: Years Ended December 31, (in thousands) 2022 2021 2020 Cash and cash equivalents $ 257,223 $ 24,453 $ 204,998 Restricted cash and restricted cash equivalents 116,357 8,824 2,749 Ending balance $ 373,580 $ 33,277 $ 207,747 |
Schedule of Restricted Cash and Cash Equivalents | The following table reconciles the amounts below reported in the Consolidated Balance Sheets to the total of the same such amounts shown in the Consolidated Statements of Cash Flows: Years Ended December 31, (in thousands) 2022 2021 2020 Cash and cash equivalents $ 257,223 $ 24,453 $ 204,998 Restricted cash and restricted cash equivalents 116,357 8,824 2,749 Ending balance $ 373,580 $ 33,277 $ 207,747 |
Supplementary Cash Flow Information | The following table summarizes supplementary cash flow information and material non-cash investing and financing transactions, excluding leases (refer to Note 14 “Leases”): Years Ended December 31, (in thousands) 2022 2021 2020 Interest paid, net of interest income received (1) $ 452,105 $ 456,509 $ 510,185 Payments (refunds) on income taxes, net $ 22,654 $ 1,877 $ 25,802 Issuance of shares for acquisition of businesses (2) $ 55,485 $ 528,503 $ 113,841 Contingent forward purchase contract (3) $ 41,938 $ — $ — ___________________ (1) Excludes interest on interest rate swaps presented within financing activities. Refer to Note 8 “Derivative Financial Instruments.” (2) During 2022, includes $40 million related to the Delayed Shares (as defined in Note 4 “Acquisitions and Disposition”) as a result of the ADT Solar Acquisition. During 2021 and 2020, relates to the ADT Solar Acquisition and the Defenders Acquisition, respectively (both as defined and discussed in Note 4 “Acquisitions and Disposition”). (3) During 2022, the Company recorded a reduction to additional paid in capital as a result of the contingent forward purchase contract in connection with the Tender Offer (as defined and discussed in Note 10 “Equity”). Years Ended December 31, ( in thousands ) 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases: Operating cash flows $ 47,708 $ 50,721 $ 56,235 Finance Leases: Operating cash flows $ 3,680 $ 2,823 $ 3,122 Financing cash flows $ 44,978 $ 32,123 $ 27,956 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 49,193 $ 21,203 $ 47,870 Finance leases $ 48,439 $ 46,920 $ 15,326 |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets December 31, (in thousands) 2022 2021 Prepaid expenses $ 28,648 $ 30,373 Contract assets (see Note 2 "Revenue and Receivables") 33,632 58,452 Fair value of interest rate swaps (see Note 8 "Derivative Financial Instruments") 78,110 — Other receivables (1) 122,476 23,211 Other current assets 77,982 57,209 Prepaid expenses and other current assets $ 340,848 $ 169,245 ___________________ (1) As of December 31, 2022, the Company recorded a liability of approximately $88 million, which is reflected in accrued expenses and other current liabilities and which relates to certain loans provided to customers within the Solar business that the Company may be required to repurchase from the third party lenders. Included in other receivables is the amount that the Company expects to recover if permission to operate is achieved in the event the third party lenders do require the Company to repurchase such loans. |
Schedule of Property, Plant and Equipment and Depreciation Expense | Property and equipment, net, is recorded at historical cost less accumulated depreciation, which is calculated using the straight-line method over the estimated useful lives of the related assets. Depreciation expense is reflected in depreciation and intangible asset amortization. Repairs and maintenance expenditures are expensed when incurred. Useful Lives: Buildings and related improvements Up to 40 years Leasehold improvements Lesser of remaining term of the lease or economic useful life Capitalized software 3 to 10 years Machinery, equipment, and other Up to 10 years Net Carrying Amount: December 31, (in thousands) 2022 2021 Land $ 13,052 $ 13,120 Buildings and leasehold improvements 115,887 112,475 Capitalized software 560,581 491,184 Machinery, equipment, and other 205,828 205,696 Construction in progress 16,426 26,335 Finance leases 199,487 166,925 Accumulated depreciation (735,293) (651,627) Property and equipment, net $ 375,968 $ 364,108 Depreciation Expense: Years Ended December 31, (in thousands) 2022 2021 2020 Depreciation expense $ 206,709 $ 197,202 $ 187,386 |
Schedule of Subscriber System Assets, Net | Subscriber system assets represent capitalized equipment and installation costs incurred in connection with transactions in which the Company retains ownership of the security system and are reflected in the Consolidated Balance Sheets as follows: December 31, (in thousands) 2022 2021 Gross carrying amount $ 6,205,762 $ 5,499,703 Accumulated depreciation (3,144,459) (2,632,175) Subscriber system assets, net $ 3,061,303 $ 2,867,528 |
Schedule of Subscriber System Depreciation and Amortization Cost | Depreciation of subscriber system assets and amortization of deferred subscriber acquisition costs are reflected in depreciation and intangible asset amortization and selling, general, and administrative expenses, respectively, as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Depreciation of subscriber system assets $ 551,260 $ 506,568 $ 501,669 Amortization of deferred subscriber acquisition costs $ 162,981 $ 126,089 $ 96,823 |
Schedule of Accrued Liabilities | December 31, (in thousands) 2022 2021 Accrued interest $ 156,495 $ 124,579 Payroll-related accruals 208,111 196,165 Operating lease liabilities (see Note 14 "Leases") 28,696 37,359 Fair value of interest rate swaps (see Note 8 "Derivative Financial Instruments") — 50,360 Opportunity Fund (see Note 10 "Equity") 100,802 — Other accrued liabilities 405,676 328,782 Accrued expenses and other current liabilities $ 899,780 $ 737,245 |
Schedule of Radio Conversion Costs and Revenue | Radio conversion costs and radio conversion revenue are reflected in selling, general, and administrative expenses and monitoring and related services revenue, respectively, as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Radio conversion costs $ 31,428 $ 250,490 $ 88,709 Radio conversion revenue $ 28,075 $ 39,127 $ 36,820 |
Schedule of Carrying Amount and Fair Value of Retail Installment Contract Receivables | December 31, 2022 2021 (in thousands) Carrying Fair Carrying Fair Retail installment contract receivables, net $ 531,516 $ 385,114 $ 330,605 $ 255,147 |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments and Securities | December 31, 2022 2021 (in thousands) Carrying Fair Carrying Fair Long-term debt instruments, excluding finance lease obligations, subject to fair value disclosures $ 9,733,700 $ 9,312,932 $ 9,599,610 $ 10,043,877 |
Revenue and Receivables (Tables
Revenue and Receivables (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Disaggregated Revenue Years Ended December 31, (in thousands) 2022 2021 2020 CSB: Monitoring and related services $ 4,050,019 $ 3,873,285 $ 3,760,614 Security installation, product, and other 328,786 272,743 564,575 Total CSB 4,378,805 4,146,028 4,325,189 Commercial: Monitoring and related services 539,246 474,428 426,373 Security installation, product, and other 690,833 639,304 563,225 Total Commercial 1,230,079 1,113,732 989,598 Solar: Solar installation, product, and other 786,426 47,351 — Total Solar 786,426 47,351 — Total revenue $ 6,395,310 $ 5,307,111 $ 5,314,787 |
Amortization of Deferred Subscriber Acquisition Revenue | Years Ended December 31, ( in thousands ) 2022 2021 2020 Amortization of deferred subscriber acquisition revenue $ 244,141 $ 172,061 $ 124,804 |
Allowance for Credit Loss Rollforward | Changes in the Allowance for Credit Losses: Years Ended December 31, (in thousands) 2022 2021 2020 (1) Beginning balance $ 54,032 $ 68,342 $ 42,960 Provision for credit losses (2) 99,760 51,877 81,713 Write-offs, net of recoveries (3) (88,137) (66,187) (56,331) Ending balance $ 65,655 $ 54,032 $ 68,342 ________________ (1) Beginning balance reflected is subsequent to the adoption on January 1, 2020 of ASU 2016-13, Measurement of Credit Losses on Financial Instruments, and related amendments. The impact of adoption was not material. (2) The provisions for credit losses during 2021 and 2020 were impacted by adjustments related to the COVID-19 Pandemic. (3) Recoveries were not material for the periods presented. As such, write-offs are presented net of recoveries. |
Schedule of Unbilled Retail Installment Contract Receivables, Net | The balance of unbilled retail installment contract receivables comprises: December 31, (in thousands) 2022 2021 Retail installment contract receivables, gross $ 532,406 $ 331,512 Allowance for credit losses (890) (907) Retail installment contract receivables, net $ 531,516 $ 330,605 Balance Sheet Classification: Accounts receivable, net $ 169,242 $ 100,385 Other assets 362,274 230,220 Retail installment contract receivables, net $ 531,516 $ 330,605 |
Contract with Customer, Contract Asset, Contract Liability, and Receivable | The balance of contract assets for residential transactions comprises: December 31, (in thousands) 2022 2021 Contract assets, gross $ 54,305 $ 106,810 Allowance for credit losses (5,453) (12,300) Contract assets, net $ 48,852 $ 94,510 Balance Sheet Classification: Prepaid expenses and other current assets $ 33,632 $ 58,452 Other assets 15,220 36,058 Contract assets, net $ 48,852 $ 94,510 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Total Revenue by Segment and Reconciliation to Consolidated Total Revenue | The following table presents total revenue by segment and a reconciliation to consolidated total revenue: Years Ended December 31, (in thousands) 2022 2021 2020 CSB $ 4,378,805 $ 4,146,028 $ 4,325,189 Commercial 1,230,079 1,113,732 989,598 Solar 786,426 47,351 — Total Revenue $ 6,395,310 $ 5,307,111 $ 5,314,787 |
Schedule of Segment Information EBITDA Reconciliation | The following table presents Adjusted EBITDA by segment and a reconciliation to consolidated income (loss) before income taxes and equity in net earnings (losses) of equity method investee: Years Ended December 31, (in thousands) 2022 2021 2020 Adjusted EBITDA by segment: CSB $ 2,314,633 $ 2,110,879 $ 2,153,899 Commercial 126,940 96,112 45,338 Solar 5,155 5,588 — Total $ 2,446,728 $ 2,212,579 $ 2,199,237 Reconciliation: Total segment Adjusted EBITDA (1) $ 2,446,728 $ 2,212,579 $ 2,199,237 Less: Interest expense, net 265,285 457,667 708,189 Depreciation and intangible asset amortization 1,693,575 1,914,779 1,913,767 Amortization of deferred subscriber acquisition costs 162,981 126,089 96,823 Amortization of deferred subscriber acquisition revenue (244,141) (172,061) (124,804) Share-based compensation expense 66,566 61,237 96,013 Merger, restructuring, integration, and other (2) 22,232 37,872 120,208 Goodwill impairment (3) 200,974 — — Loss on extinguishment of debt (4) — 37,113 119,663 Change in fair value of financial instruments (5) 63,396 — — Radio conversion costs, net (6) 3,353 211,363 51,889 Acquisition-related adjustments (7) 35,229 12,945 438 Equity in net earnings (losses) of equity method investee (4,601) — — Other (8) (3,935) (3,236) (4,030) Income (loss) before income taxes and equity in net earnings (losses) of equity method investee $ 185,814 $ (471,189) $ (778,919) ___________________ (1) Except for the presentation of goodwill impairment and income (loss) before income taxes and equity in net earnings (losses) of equity method investee, total segment Adjusted EBITDA did not change as a result of the restatement. (2) Refer to Note 4 “Acquisitions and Disposition.” (3) Represents a goodwill impairment charge associated with the Company’s Solar reporting unit (as discussed in Note 1 “Description of Business and Summary of Significant Accounting Policies” and Note 6 “Goodwill and Other Intangible Assets”). (4) Refer to Note 7 “Debt.” (5) Represents the change in fair value of the Forward Contract (as defined and discussed in Note 10 “Equity”). (6) Refer to Note 1 “Description of Business and Summary of Significant Accounting Policies.” (7) During 2022 and 2021, primarily represents the amortization of the customer backlog intangible asset acquired in the ADT Solar Acquisition, which was fully amortized as of March 2022. Refer to Note 4 “Acquisitions and Disposition.” (8) During 2022, primarily represents the gain on sale of a business. During 2020, included recoveries of $10 million associated with notes receivable from a former strategic investment. |
Acquisitions and Disposition (T
Acquisitions and Disposition (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Fair Value of Assets Acquired and Liabilities Assumed | Fair Value of Assets Acquired and Liabilities Assumed (in thousands): Cash $ 38,493 Accounts receivable 35,849 Inventories 49,526 Prepaid expenses and other current assets 12,616 Property and equipment 10,047 Goodwill 712,150 Other definite-lived intangible assets 41,800 Other assets 27,653 Accounts payable (54,223) Deferred revenue (45,966) Accrued expenses and other current liabilities (45,391) Current maturities of long-term debt (7,643) Other liabilities (9,370) Long-term debt (15,112) Total consideration transferred $ 750,429 |
Summary of Business Acquisition, Pro Forma Information | The following summary, prepared on a pro forma basis, presents the Company’s unaudited consolidated results of operations for 2021 and 2020 as if the ADT Solar Acquisition had been completed as of January 1, 2020. The pro forma results below include the impact of certain adjustments related to the amortization of intangible assets, acquisition-related costs incurred as of the acquisition date, and in each case, the related income tax effects, as well as certain other post-acquisition adjustments directly attributable to the acquisition. This pro forma presentation does not include any impact of transaction synergies. The pro forma results are not necessarily indicative of the results of operations that actually would have been achieved had the ADT Solar Acquisition been consummated as of that date: Years Ended December 31, ( in thousands ) 2021 2020 Total revenue $ 5,905,148 $ 5,590,880 Net income (loss) $ (328,099) $ (680,992) |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Goodwill | During the periods presented, changes in the carrying amount of goodwill by reportable segment were as follows: (in thousands) CSB Commercial Solar Total Balance as of January 1, 2021 (1) $ 4,906,691 $ 329,611 $ — $ 5,236,302 Acquisitions (2)(3) (25) 12,400 694,726 707,101 Balance as of December 31, 2021 4,906,666 342,011 694,726 5,943,403 Acquisitions (3) 12,585 6,309 17,424 36,318 Impairment (4) — — (200,974) (200,974) Disposition — (11,731) — (11,731) Balance as of December 31, 2022 (Restated) $ 4,919,251 $ 336,589 $ 511,176 $ 5,767,016 ________________ (1) Reflects the allocated goodwill from the reporting unit change during the fourth quarter of 2020, in which the Company reassigned a portion of goodwill on a relative fair value basis related to the Company’s commercial customers from the CSB reporting unit (previously, the U.S. reporting unit) to the Commercial reporting unit (previously, the Red Hawk reporting unit). Beginning in the first quarter of 2021, the Company began reporting results for two operating and reportable segments, CSB and Commercial, which comprise the CSB and Commercial reporting units, respectively. (2) Upon consummation of the ADT Solar Acquisition in the fourth quarter of 2021, the Company began reporting results for a third operating and reportable segment related to the ADT Solar business, which comprises the Solar reporting unit. (3) Includes the impact of measurement period adjustments, which were not material during the periods presented. (4) Amount presented as restated. Refer to Note 1 “Description of Business and Summary of Significant Accounting Policies.” |
Schedule of Finite-Lived Intangible Assets | December 31, 2022 December 31, 2021 (in thousands) Gross Carrying Accumulated Net Carrying Amount Gross Carrying Accumulated Net Carrying Amount Definite-lived intangible assets: Contracts and related customer relationships (1) $ 7,021,305 $ (4,262,383) $ 2,758,922 $ 8,719,363 $ (5,753,345) $ 2,966,018 Dealer relationships (2) 1,518,020 (538,801) 979,219 1,518,020 (459,248) 1,058,772 Other (3) 224,783 (204,177) 20,606 263,133 (207,572) 55,561 Total definite-lived intangible assets 8,764,108 (5,005,361) 3,758,747 10,500,516 (6,420,165) 4,080,351 Indefinite-lived intangible assets: Trade name (4) 1,333,000 — 1,333,000 1,333,000 — 1,333,000 Intangible assets $ 10,097,108 $ (5,005,361) $ 5,091,747 $ 11,833,516 $ (6,420,165) $ 5,413,351 __________________ (1) During 2022, the Company retired $2.3 billion of certain customer relationship intangible assets acquired in the ADT Acquisition that became fully amortized. (2) Originated from the Formation Transactions and the ADT Acquisition in 2015 and 2016, respectively. Amortized primarily over 19 years on a straight-line basis based on management estimates about attrition and the longevity of the underlying dealer network that existed at the time of acquisition. (3) Primarily relates to trade names and other technology assets. Amortized over a period of up to 10 years on a straight-line basis. (4) ADT trade name acquired as part of the ADT Acquisition. The change in the net carrying amount of contracts and related customer relationships was as follows: Years Ended December 31, (in thousands) 2022 2021 Beginning balance $ 2,966,018 $ 3,374,156 Acquisition of customer relationships 3,000 5,333 Customer contract additions, net of dealer charge-backs 633,442 696,316 Amortization (841,899) (1,109,787) Other (1,639) — Ending balance $ 2,758,922 $ 2,966,018 |
Schedule of Indefinite-Lived Intangible Assets | December 31, 2022 December 31, 2021 (in thousands) Gross Carrying Accumulated Net Carrying Amount Gross Carrying Accumulated Net Carrying Amount Definite-lived intangible assets: Contracts and related customer relationships (1) $ 7,021,305 $ (4,262,383) $ 2,758,922 $ 8,719,363 $ (5,753,345) $ 2,966,018 Dealer relationships (2) 1,518,020 (538,801) 979,219 1,518,020 (459,248) 1,058,772 Other (3) 224,783 (204,177) 20,606 263,133 (207,572) 55,561 Total definite-lived intangible assets 8,764,108 (5,005,361) 3,758,747 10,500,516 (6,420,165) 4,080,351 Indefinite-lived intangible assets: Trade name (4) 1,333,000 — 1,333,000 1,333,000 — 1,333,000 Intangible assets $ 10,097,108 $ (5,005,361) $ 5,091,747 $ 11,833,516 $ (6,420,165) $ 5,413,351 __________________ (1) During 2022, the Company retired $2.3 billion of certain customer relationship intangible assets acquired in the ADT Acquisition that became fully amortized. (2) Originated from the Formation Transactions and the ADT Acquisition in 2015 and 2016, respectively. Amortized primarily over 19 years on a straight-line basis based on management estimates about attrition and the longevity of the underlying dealer network that existed at the time of acquisition. (3) Primarily relates to trade names and other technology assets. Amortized over a period of up to 10 years on a straight-line basis. |
Schedule of Finite-Lived Intangible Assets, Amortization Expense | Definite-Lived Intangible Asset Amortization Expense Years Ended December 31, (in thousands) 2022 2021 2020 Definite-lived intangible asset amortization expense $ 934,700 $ 1,209,966 $ 1,222,398 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | As of December 31, 2022, the estimated aggregate amortization expense on our existing intangible assets is expected to be as follows ( in thousands) : 2023 2024 2025 2026 2027 Thereafter $ 597,695 $ 484,023 $ 422,112 $ 372,228 $ 337,209 $ 1,545,480 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The Company’s debt is comprised of the following (in thousands) : Interest Payable Balance as of December 31, Debt Description Issued Maturity Interest Rate (1) 2022 2021 First Lien Term Loan due 2026 9/23/2019 9/23/2026 Adj. LIBOR +2.75% Quarterly $ 2,730,269 $ 2,758,058 First Lien Revolving Credit Facility 3/16/2018 6/23/2026 Adj. LIBOR +2.75% Quarterly — 25,000 Second Lien Notes due 2028 1/28/2020 1/15/2028 6.250% 1/15 and 7/15 1,300,000 1,300,000 First Lien Notes due 2024 4/4/2019 4/15/2024 5.250% 2/15 and 8/15 750,000 750,000 First Lien Notes due 2026 4/4/2019 4/15/2026 5.750% 3/15 and 9/15 1,350,000 1,350,000 First Lien Notes due 2027 8/20/2020 8/31/2027 3.375% 6/15 and 12/15 1,000,000 1,000,000 First Lien Notes due 2029 7/29/2021 8/1/2029 4.125% 2/1 and 8/1 1,000,000 1,000,000 ADT Notes due 2023 1/14/2013 6/15/2023 4.125% 6/15 and 12/15 700,000 700,000 ADT Notes due 2032 5/2/2016 7/15/2032 4.875% 1/15 and 7/15 728,016 728,016 ADT Notes due 2042 7/5/2012 7/15/2042 4.875% 1/15 and 7/15 21,896 21,896 Receivables Facility 3/5/2020 11/20/2027 Adj. Daily SOFR +0.85% Monthly 354,741 199,056 Other debt (2) 2,446 4,732 Total debt principal, excluding finance leases 9,937,368 9,836,758 Plus: Finance lease obligations (3) 94,888 93,080 Less: Unamortized debt discount, net (13,415) (16,678) Less: Unamortized deferred financing costs (50,896) (64,014) Less: Unamortized purchase accounting fair value adjustment and other (139,357) (156,456) Total debt 9,828,588 9,692,690 Less: Current maturities of long-term debt, net of unamortized debt discount (871,917) (117,592) Long-term debt $ 8,956,671 $ 9,575,098 __________________ (1) LIBOR refers to the London Interbank Offered Rate. SOFR refers to the Secured Overnight Financing Rate. (2) Other debt primarily consists of vehicle loans at various interest rates and maturities. (3) Refer to Note 14 “Leases” for additional information regarding the Company’s finance leases. |
Schedule of Maturities of Long-term Debt | As of December 31, 2022, the aggregate annual maturities of debt, excluding finance leases, were as follows: (in thousands) 2023 2024 2025 2026 2027 Thereafter Total Debt principal $ 827,145 $ 880,053 $ 108,760 $ 4,051,137 $ 1,020,362 $ 3,049,911 $ 9,937,368 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | Interest Rate Swaps: (in thousands) December 31, Execution Maturity Designation 2022 2021 January 2019 April 2022 Not designated $ — $ 125,000 February 2019 April 2022 Not designated — 300,000 October 2019 September 2026 Not designated 2,800,000 2,800,000 Total notional amount $ 2,800,000 $ 3,225,000 |
Schedule of Derivative Liabilities at Fair Value | Fair Value of Interest Rate Swaps: December 31, Balance Sheet Classification (in thousands) 2022 2021 Prepaid expenses and other current assets $ 78,110 $ — Other assets $ 105,405 $ — Accrued expenses and other current liabilities $ — $ 50,360 Other liabilities $ — $ 67,976 Unrealized Gain (Loss) on Interest Rate Swaps: Years Ended December 31, (in thousands) 2022 2021 2020 Gain (loss) included in interest expense, net $ 301,851 $ 157,505 $ (60,363) |
Schedule of Accumulated Other Comprehensive Loss | Changes in AOCI: (in thousands) Cash Flow Hedges Balance as of December 31, 2019 $ (59,387) Pre-tax current period change (76,807) Income tax benefit (expense) 18,693 Balance as of December 31, 2020 (117,501) Pre-tax current period change 60,948 Income tax benefit (expense) (14,714) Balance as of December 31, 2021 (71,267) Pre-tax current period change 33,946 Income tax benefit (expense) (8,192) Balance as of December 31, 2022 $ (45,513) |
Reclassification out of Accumulated Other Comprehensive Income | Cash Flow Hedges Reclassifications out of AOCI: Years Ended December 31, (in thousands) 2022 2021 2020 Interest expense, net $ 33,946 $ 60,948 $ 54,452 Income tax (benefit) expense $ (8,192) $ (14,714) $ (13,254) |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Loss before Income Taxes for Domestic and Foreign Locations | Components of income (loss) before income taxes: Years Ended December 31, (in thousands) 2022 2021 2020 United States $ 183,101 $ (473,504) $ (782,256) Foreign 2,713 2,315 3,337 Income (loss) before income taxes $ 185,814 $ (471,189) $ (778,919) |
Schedule of Components of Income Tax Expense (Benefit) | Components of income tax benefit (expense): Years Ended December 31, (in thousands) 2022 2021 2020 Current: Federal $ (184) $ (174) $ 370 State (28,100) (8,367) (27,059) Foreign (691) (570) — Current income tax benefit (expense) (28,975) (9,111) (26,689) Deferred: Federal (43,201) 97,805 133,646 State 24,029 41,901 39,842 Foreign (403) (226) (73) Deferred income tax benefit (expense) (19,575) 139,480 173,415 Income tax benefit (expense) $ (48,550) $ 130,369 $ 146,726 |
Schedule of Effective Income Tax Rate Reconciliation | Reconciliations between the actual effective tax rate on continuing operations and the statutory U.S. federal income tax rate were as follows: Years Ended December 31, 2022 2021 2020 Statutory federal tax rate 21.0 % 21.0 % 21.0 % Statutory state tax rate, net of federal benefits 6.9 % 2.7 % 2.9 % Non-deductible and non-taxable charges (1) 14.1 % 0.3 % (3.1) % Valuation allowance (1.3) % 0.5 % (1.5) % Prior year return adjustments 2.0 % 0.4 % (0.3) % Federal credits (6.4) % — % — % Acquisitions (0.4) % 1.3 % 0.2 % Legislative changes (4.5) % 0.8 % — % Uncertain tax positions (4.9) % — % — % Other (0.4) % 0.7 % (0.4) % Effective tax rate 26.1 % 27.7 % 18.8 % ___________________ (1) During 2022, primarily represents the impact related to the fair value adjustment of the Forward Contract. |
Schedule of Deferred Tax Assets and Liabilities | The components of the Company's net deferred tax assets (liabilities) were as follows : December 31, (in thousands) 2022 2021 Deferred tax assets: Accrued liabilities and reserves $ 117,488 $ 113,085 Tax loss and credit carryforwards 468,209 594,821 Disallowed interest carryforward 185,080 140,974 Deferred revenue 187,766 140,604 Other 95,008 101,886 Total deferred tax assets 1,053,551 1,091,370 Valuation allowance (57,715) (60,157) Deferred tax assets, net of valuation allowance $ 995,836 $ 1,031,213 Deferred tax liabilities: Subscriber system assets $ (766,067) $ (729,548) Intangible assets (1,023,895) (1,139,927) Other (97,772) (27,442) Total deferred tax liabilities (1,887,734) (1,896,917) Net deferred tax assets (liabilities) $ (891,898) $ (865,704) |
Summary of Valuation Allowance | The changes in the valuation allowance for deferred tax assets were as follows: Years Ended December 31, (in thousands) 2022 2021 2020 Beginning balance $ (60,157) $ (68,013) $ (56,841) Income tax benefit (expense) 2,428 2,378 (11,999) Write-offs and other (1) 14 5,478 827 Ending balance $ (57,715) $ (60,157) $ (68,013) __________________ (1) During 2021, includes the removal of valuation allowances associated with certain tax attributes that expired during the year. Both the expired attributes and related valuation allowances were removed concurrently. |
Schedule of Unrecognized Tax Benefits Roll Forward | The following is a roll-forward of unrecognized tax benefits: Years Ended December 31, (in thousands) 2022 2021 2020 Beginning balance $ 66,221 $ 65,990 $ 65,117 Gross increase related to prior year tax positions 5,063 373 1,348 Gross decrease related to prior year tax positions — — (732) Increases related to acquisitions — — 400 Decreases related to lapse of statute of limitation (15,107) (142) (143) Ending balance $ 56,177 $ 66,221 $ 65,990 |
Summary of Open Tax Years | Jurisdiction Years Open to Audit Federal 2019 - 2021 State 2017 - 2021 Canada 2017 - 2021 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of Dividends Declared | (in thousands, except per share data) Common Stock Class B Common Stock Declaration Date Record Date Payment Date Per Share Aggregate Per Share Aggregate Year Ended December 31, 2022 3/1/22 3/17/22 4/4/22 $ 0.035 $ 29,842 $ 0.035 $ 1,916 5/5/22 6/16/22 7/5/22 0.035 30,028 0.035 1,916 8/4/22 9/15/22 10/4/22 0.035 30,112 0.035 1,916 11/3/22 12/15/22 1/4/23 0.035 30,189 0.035 1,916 Total $ 0.140 $ 120,171 $ 0.140 $ 7,664 Year Ended December 31, 2021 2/25/21 3/18/21 4/1/21 $ 0.035 $ 27,220 $ 0.035 $ 1,916 5/5/21 6/17/21 7/1/21 0.035 27,268 0.035 1,916 8/4/21 9/16/21 10/5/21 0.035 27,270 0.035 1,916 11/9/21 12/16/21 1/4/22 0.035 29,732 0.035 1,916 Total $ 0.140 $ 111,490 $ 0.140 $ 7,664 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Disclosure of Share-based Compensation Expense | Share-based compensation expense recognized in selling, general, and administrative expenses was as follows: Years Ended December 31, ( in thousands ) 2022 2021 2020 Share-based compensation expense $ 66,566 $ 61,237 $ 96,013 |
Summary of Distributed Shares Activity | The following table summarizes activity related to the Distributed Shares during 2022: Performance Tranche Number of Distributed Shares Weighted-Average Grant Fair Value Unvested as of December 31, 2021 9,503,668 $ 13.08 Vested — — Forfeited (180,182) 14.48 Unvested as of December 31, 2022 9,323,486 $ 13.05 |
Summary of Related 2018 Plan Top-up Options Activity | The following table summarizes activity related to the 2018 Plan Top-up Options: Service Tranche Performance Tranche Number of Top-up Options Weighted-Average Exercise Price Number of Top-up Options Weighted-Average Exercise Price Aggregate Intrinsic Value (a) (in thousands) Weighted-Average Remaining Contractual Term (Years) Outstanding as of December 31, 2021 5,974,369 $ 13.30 5,850,549 $ 13.30 Exercised — — — — Forfeited (19,115) 13.30 (135,488) 13.30 Outstanding as of December 31, 2022 5,955,254 $ 13.30 5,715,061 $ 13.30 — 5.0 Exercisable as of December 31, 2022 5,955,254 $ 13.30 — $ 13.30 — 5.0 ________________________ (a) The intrinsic value represents the amount by which the fair value of the Company’s Common Stock exceeds the option exercise price as of December 31, 2022. The following table summarizes activity related to 2018 Plan options during 2022: Number of Options Weighted-Average Exercise Price Aggregate Intrinsic Value (a) (in thousands) Weighted-Average Remaining Contractual Term (Years) Outstanding as of December 31, 2021 21,465,818 $ 6.64 Granted — — Exercised (2,984,552) 5.39 Forfeited (515,640) 11.23 Outstanding as of December 31, 2022 17,965,626 $ 6.67 $ 52,245 6.3 Exercisable as of December 31, 2022 14,515,244 $ 6.73 $ 43,134 6.2 ________________________ (a) The intrinsic value represents the amount by which the fair value of the Company’s Common Stock exceeds the option exercise price as of December 31, 2022. |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | During 2020, the grant date fair values of options granted under the 2018 Plan were determined using the Black-Scholes valuation approach with the following assumptions: Risk-free interest rate 0.51% - 1.40% Expected exercise term (years) 6 Expected dividend yield 2.2% - 2.7% Expected volatility 45% - 46% |
Summary of Related 2018 Plan RSUs Activity | The following table summarizes activity related to the 2018 Plan RSUs (including DEUs) during 2022: Number of RSUs Weighted-Average Grant Date Fair Value Unvested as of December 31, 2021 15,544,846 $ 6.90 Granted 6,599,292 7.85 Vested (7,769,568) 6.76 Forfeited (1,219,161) 7.83 Unvested as of December 31, 2022 13,155,409 $ 7.38 |
Net (Loss) Income Per Share (Ta
Net (Loss) Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Years Ended December 31, (in thousands, except per share amounts) 2022 2021 2020 Allocation of net income (loss) - basic $ 124,655 $ (318,062) $ (620,856) Dilutive effect (including conversion of Class B Common Stock) 7,690 — — Allocation of net income (loss) - diluted $ 132,345 $ (318,062) $ (620,856) Weighted-average shares outstanding - basic 848,465 770,620 760,483 Dilutive effect (including conversion of Class B Common Stock) 66,603 — — Weighted-average shares outstanding - diluted 915,068 770,620 760,483 Net income (loss) per share - basic $ 0.15 $ (0.41) $ (0.82) Net income (loss) per share - diluted $ 0.15 $ (0.41) $ (0.82) Class B Common Stock: During 2022 and 2021, there were no potential shares of Class B Common Stock. During 2020, potential shares of Class B Common Stock included (i) incremental shares of Class B Common Stock calculated using the treasury stock method for the period in which the Securities Purchase Agreement was outstanding prior to closing and (ii) incremental shares of Class B Common Stock calculated using the treasury stock method for Google’s option to purchase additional shares of Class B Common Stock prior to closing. Years Ended December 31, (in thousands, except per share amounts) 2022 2021 2020 Allocation of net income (loss) - basic $ 8,008 $ (22,758) $ (11,337) Dilutive effect (24) — (1,952) Allocation of net income (loss) - diluted $ 7,984 $ (22,758) $ (13,289) Weighted-average shares outstanding - basic 54,745 54,745 15,855 Dilutive effect — — 2,089 Weighted-average shares outstanding - diluted 54,745 54,745 17,944 Net income (loss) per share - basic $ 0.15 $ (0.41) $ (0.72) Net income (loss) per share - diluted $ 0.15 $ (0.41) $ (0.74) |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Contractual Obligations Commitments | The following table provides the Company’s contractual obligations as of December 31, 2022 (in thousands) : 2023 2024 2025 2026 2027 Thereafter Total $ 175,861 $ 67,286 $ 43,386 $ 24,826 $ 412 $ — $ 311,771 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Consolidated Balance Sheet Information Related to Leases | (in thousands) December 31, Presentation and Classification: 2022 2021 Operating Current Prepaid expenses and other current assets $ 210 $ 230 Operating Non-current Other assets 128,455 125,945 Finance Non-current Property and equipment, net (1) 93,013 88,962 Total right-of-use assets $ 221,678 $ 215,137 Operating Current Accrued expenses and other current liabilities $ 28,696 $ 37,359 Finance Current Current maturities of long-term debt 48,512 38,730 Operating Non-current Other liabilities 116,823 99,734 Finance Non-current Long-term debt 46,376 54,350 Total lease liabilities $ 240,407 $ 230,173 _________________ |
Schedule of Lease Cost | Years Ended December 31, ( in thousands ) 2022 2021 2020 Operating lease cost $ 47,047 $ 48,078 $ 56,680 Finance lease cost: Amortization of right-of-use assets 43,627 29,269 24,509 Interest on lease liabilities 3,680 2,823 3,122 Variable lease costs 90,671 72,367 47,013 Total lease cost $ 185,025 $ 152,537 $ 131,324 |
Supplementary Cash Flow Information | The following table summarizes supplementary cash flow information and material non-cash investing and financing transactions, excluding leases (refer to Note 14 “Leases”): Years Ended December 31, (in thousands) 2022 2021 2020 Interest paid, net of interest income received (1) $ 452,105 $ 456,509 $ 510,185 Payments (refunds) on income taxes, net $ 22,654 $ 1,877 $ 25,802 Issuance of shares for acquisition of businesses (2) $ 55,485 $ 528,503 $ 113,841 Contingent forward purchase contract (3) $ 41,938 $ — $ — ___________________ (1) Excludes interest on interest rate swaps presented within financing activities. Refer to Note 8 “Derivative Financial Instruments.” (2) During 2022, includes $40 million related to the Delayed Shares (as defined in Note 4 “Acquisitions and Disposition”) as a result of the ADT Solar Acquisition. During 2021 and 2020, relates to the ADT Solar Acquisition and the Defenders Acquisition, respectively (both as defined and discussed in Note 4 “Acquisitions and Disposition”). (3) During 2022, the Company recorded a reduction to additional paid in capital as a result of the contingent forward purchase contract in connection with the Tender Offer (as defined and discussed in Note 10 “Equity”). Years Ended December 31, ( in thousands ) 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating leases: Operating cash flows $ 47,708 $ 50,721 $ 56,235 Finance Leases: Operating cash flows $ 3,680 $ 2,823 $ 3,122 Financing cash flows $ 44,978 $ 32,123 $ 27,956 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 49,193 $ 21,203 $ 47,870 Finance leases $ 48,439 $ 46,920 $ 15,326 |
Schedule of Operating and Finance Lease Weighted Average Lease Term and Discount Rate | December 31, 2022 2021 Weighted-average remaining lease term (years): Operating leases 5.4 4.2 Finance leases 2.8 2.8 Weighted-average discount rate: Operating leases 5.5 % 4.8 % Finance leases 4.5 % 3.7 % |
Schedule of Operating and Finance Lease, Liability, Maturity | December 31, 2022 ( in thousands ) Operating Leases Finance Leases 2023 $ 33,049 $ 44,629 2024 36,235 31,050 2025 29,518 19,370 2026 23,519 5,332 2027 15,956 714 Thereafter 36,115 — Total lease payments (including interest) $ 174,392 $ 101,095 Less interest 28,873 6,207 Total $ 145,519 $ 94,888 |
Condensed Financial Informati_2
Condensed Financial Information of Registrant (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Financial Information of Registrant | ADT INC. (PARENT COMPANY ONLY) CONDENSED BALANCE SHEETS (in thousands) December 31, 2022 2021 Assets Current assets: Cash and cash equivalents $ 14,639 $ 1,947 Total current assets 14,639 1,947 Investment in subsidiaries and other assets 4,036,420 3,850,198 Total assets $ 4,051,059 $ 3,852,145 Liabilities and stockholders' equity Current liabilities: Dividends payable and other current liabilities $ 34,424 $ 47,482 Total current liabilities 34,424 47,482 Long-term debt 536,495 527,098 Other liabilities 86,992 28,846 Total liabilities 657,911 603,426 Total stockholders' equity 3,393,148 3,248,719 Total liabilities and stockholders' equity $ 4,051,059 $ 3,852,145 The accompanying notes are an integral part of these condensed financial statements ADT INC. (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (in thousands, except per share data) Years Ended December 31, 2022 2021 2020 Selling, general, and administrative expenses $ 2,583 $ 117 $ 807 Merger, restructuring, integration, and other (6,011) (1,444) 4,532 Operating income (loss) (3,428) (1,327) 5,339 Interest expense, net (8,086) (8,743) (8,342) Other income (expense) (63,394) — — Equity in net income (loss) of subsidiaries 200,715 (333,404) (618,512) Net income (loss) 132,663 (340,820) (632,193) Other comprehensive income (loss), net of tax 21,773 49,642 (60,239) Comprehensive income (loss) $ 154,436 $ (291,178) $ (692,432) Net income (loss) per share - basic: Common stock $ 0.15 $ (0.41) $ (0.82) Class B common stock $ 0.15 $ (0.41) $ (0.72) Weighted-average shares outstanding - basic: Common stock 848,465 770,620 760,483 Class B common stock 54,745 54,745 15,855 Net income (loss) per share - diluted: Common stock $ 0.15 $ (0.41) $ (0.82) Class B common stock $ 0.15 $ (0.41) $ (0.74) Weighted-average shares outstanding - diluted: Common stock 915,068 770,620 760,483 Class B common stock 54,745 54,745 17,944 The accompanying notes are an integral part of these condensed financial statements ADT INC. (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF CASH FLOWS (in thousands) Years Ended December 31, 2022 2021 2020 Cash flows from operating activities: Net income (loss) $ 132,663 $ (340,820) $ (632,193) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Equity in net (income) loss of subsidiaries (200,715) 333,404 618,512 Change in fair value of other financial instruments 63,396 — — Other, net 49,470 24,391 30,687 Net cash provided by (used in) operating activities 44,814 16,975 17,006 Cash flows from investing activities: Contributions to subsidiaries — (40,000) (275,000) Distributions from subsidiaries 118,200 8,700 260,852 Acquisition of businesses — — (201,453) Other investing, net — — 750 Net cash provided by (used in) investing activities 118,200 (31,300) (214,851) Cash flows from financing activities: Proceeds from issuance of common stock, net of expenses 1,180,000 — 447,811 Dividends on common stock (127,125) (116,348) (109,328) Repurchases of common stock (1,200,000) — (4) Other financing, net (3,197) (6,472) (1,896) Net cash provided by (used in) financing activities (150,322) (122,820) 336,583 Cash and cash equivalents and restricted cash and restricted cash equivalents: Net increase (decrease) during the period 12,692 (137,145) 138,738 Beginning balance 1,947 139,092 354 Ending balance $ 14,639 $ 1,947 $ 139,092 Supplementary cash flow information: Issuance of shares for acquisition of business $ 55,485 $ 528,503 $ 113,841 |
Description of Business and S_4
Description of Business and Summary of Significant Accounting Policies - Narrative (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | 48 Months Ended | ||||
Dec. 31, 2022 USD ($) segment $ / shares | Dec. 31, 2021 USD ($) $ / shares | Dec. 31, 2020 USD ($) | Dec. 31, 2022 USD ($) $ / shares | Sep. 30, 2020 $ / shares | Jan. 31, 2018 $ / shares | |
Accounting Policies [Line Items] | ||||||
Number of reportable segments | segment | 3 | |||||
Number of operating segments | segment | 3 | |||||
Opportunity fund, current | $ 100,802 | $ 0 | $ 100,802 | |||
Revenue from contract with customer, term of customer relationship | 15 years | |||||
Accelerated method, average declining balance rate | 250% | |||||
Advertising expense | $ 219,000 | $ 239,000 | $ 264,000 | |||
Radio conversion cost, net | 292,000 | |||||
Money market funds, at carrying value | $ 145,000 | $ 145,000 | ||||
First Five Years | ||||||
Accounting Policies [Line Items] | ||||||
Accelerated method, average amortization rate | 55% | |||||
Second Five Years | ||||||
Accounting Policies [Line Items] | ||||||
Accelerated method, average amortization rate | 25% | |||||
Final Five Years | ||||||
Accounting Policies [Line Items] | ||||||
Accelerated method, average amortization rate | 20% | |||||
Class B Common Stock | ||||||
Accounting Policies [Line Items] | ||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 |
Description of Business and S_5
Description of Business and Summary of Significant Accounting Policies - Restatement (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Consolidated Balance Sheet | |||||
Goodwill | $ 5,767,016 | $ 5,943,403 | $ 5,236,302 | ||
Total assets | 17,821,236 | 16,894,351 | |||
Deferred tax liabilities | 892,994 | 867,203 | |||
Total liabilities | 14,428,088 | 13,645,632 | |||
Accumulated deficit | (3,949,579) | (3,952,590) | |||
Total stockholders' equity | 3,393,148 | 3,248,719 | 3,039,336 | $ 3,184,369 | |
Total liabilities and stockholders' equity | 17,821,236 | 16,894,351 | |||
Consolidated Statement of Operations | |||||
Goodwill impairment | $ 201,000 | 200,974 | 0 | 0 | |
Operating Income (Loss) | 508,660 | 15,278 | 40,640 | ||
Income (loss) before income taxes and equity in net earnings (losses) of equity method investee | 185,814 | (471,189) | (778,919) | ||
Income tax benefit (expense) | (48,550) | 130,369 | 146,726 | ||
Income (loss) before equity in net earnings (losses) of equity method investee | 137,264 | (340,820) | (632,193) | ||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||
Consolidated Statement of Comprehensive Income (Loss) | |||||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||
Comprehensive income (loss) | 154,436 | (291,178) | (692,432) | ||
Consolidated Statement of Stockholders' Equity | |||||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||
Total stockholders' equity | 3,393,148 | 3,248,719 | 3,039,336 | 3,184,369 | |
Consolidated Statement of Cash Flows | |||||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||
Deferred income taxes | 19,575 | (139,480) | (173,415) | ||
Goodwill, intangible, and other asset impairments | 206,132 | 19,161 | 0 | ||
Net cash provided by (used in) operating activities | 1,887,920 | 1,649,723 | 1,366,749 | ||
Accumulated Deficit | |||||
Consolidated Balance Sheet | |||||
Total stockholders' equity | (3,949,579) | (3,952,590) | (3,491,069) | (2,742,193) | |
Consolidated Statement of Operations | |||||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||
Consolidated Statement of Comprehensive Income (Loss) | |||||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||
Consolidated Statement of Stockholders' Equity | |||||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||
Total stockholders' equity | (3,949,579) | (3,952,590) | (3,491,069) | $ (2,742,193) | |
Consolidated Statement of Cash Flows | |||||
Net income (loss) | $ 132,663 | $ (340,820) | $ (632,193) | ||
Common Stock | |||||
Net income (loss) per share - basic: | |||||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) | ||
Weighted-average shares outstanding - basic: | |||||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 848,465 | 770,620 | 760,483 | ||
Net income (loss) per share - diluted: | |||||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) | ||
Weighted-average shares outstanding - diluted: | |||||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 915,068 | 770,620 | 760,483 | ||
Class B Common Stock | |||||
Net income (loss) per share - basic: | |||||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.72) | ||
Weighted-average shares outstanding - basic: | |||||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 54,745 | 54,745 | 15,855 | ||
Net income (loss) per share - diluted: | |||||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.74) | ||
Weighted-average shares outstanding - diluted: | |||||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 54,745 | 54,745 | 17,944 | ||
As Reported | |||||
Consolidated Balance Sheet | |||||
Goodwill | $ 5,818,605 | ||||
Total assets | 17,872,825 | ||||
Deferred tax liabilities | 904,628 | ||||
Total liabilities | 14,439,722 | ||||
Accumulated deficit | (3,909,624) | ||||
Total stockholders' equity | 3,433,103 | ||||
Total liabilities and stockholders' equity | 17,872,825 | ||||
Consolidated Statement of Operations | |||||
Goodwill impairment | 149,385 | ||||
Operating Income (Loss) | 560,249 | ||||
Income (loss) before income taxes and equity in net earnings (losses) of equity method investee | 237,403 | ||||
Income tax benefit (expense) | (60,184) | ||||
Income (loss) before equity in net earnings (losses) of equity method investee | 177,219 | ||||
Net income (loss) | 172,618 | ||||
Consolidated Statement of Comprehensive Income (Loss) | |||||
Net income (loss) | 172,618 | ||||
Comprehensive income (loss) | 194,391 | ||||
Consolidated Statement of Stockholders' Equity | |||||
Net income (loss) | 172,618 | ||||
Total stockholders' equity | 3,433,103 | ||||
Consolidated Statement of Cash Flows | |||||
Net income (loss) | 172,618 | ||||
Deferred income taxes | 31,209 | ||||
Goodwill, intangible, and other asset impairments | 154,543 | ||||
As Reported | Accumulated Deficit | |||||
Consolidated Balance Sheet | |||||
Total stockholders' equity | (3,909,624) | ||||
Consolidated Statement of Stockholders' Equity | |||||
Total stockholders' equity | $ (3,909,624) | ||||
As Reported | Common Stock | |||||
Net income (loss) per share - basic: | |||||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.19 | ||||
Weighted-average shares outstanding - basic: | |||||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 848,465 | ||||
Net income (loss) per share - diluted: | |||||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.19 | ||||
Weighted-average shares outstanding - diluted: | |||||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 915,068 | ||||
As Reported | Class B Common Stock | |||||
Net income (loss) per share - basic: | |||||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.19 | ||||
Weighted-average shares outstanding - basic: | |||||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 54,745 | ||||
Net income (loss) per share - diluted: | |||||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.19 | ||||
Weighted-average shares outstanding - diluted: | |||||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 54,745 | ||||
Adjustments | |||||
Consolidated Balance Sheet | |||||
Goodwill | $ (51,589) | ||||
Total assets | (51,589) | ||||
Deferred tax liabilities | (11,634) | ||||
Total liabilities | (11,634) | ||||
Accumulated deficit | (39,955) | ||||
Total stockholders' equity | (39,955) | ||||
Total liabilities and stockholders' equity | (51,589) | ||||
Consolidated Statement of Operations | |||||
Goodwill impairment | 51,589 | ||||
Operating Income (Loss) | (51,589) | ||||
Income (loss) before income taxes and equity in net earnings (losses) of equity method investee | (51,589) | ||||
Income tax benefit (expense) | 11,634 | ||||
Income (loss) before equity in net earnings (losses) of equity method investee | (39,955) | ||||
Net income (loss) | (39,955) | ||||
Consolidated Statement of Comprehensive Income (Loss) | |||||
Net income (loss) | (39,955) | ||||
Comprehensive income (loss) | (39,955) | ||||
Consolidated Statement of Stockholders' Equity | |||||
Net income (loss) | (39,955) | ||||
Total stockholders' equity | (39,955) | ||||
Consolidated Statement of Cash Flows | |||||
Net income (loss) | (39,955) | ||||
Deferred income taxes | (11,634) | ||||
Adjustments | Accumulated Deficit | |||||
Consolidated Balance Sheet | |||||
Total stockholders' equity | (39,955) | ||||
Consolidated Statement of Stockholders' Equity | |||||
Total stockholders' equity | $ (39,955) | ||||
Adjustments | Common Stock | |||||
Net income (loss) per share - basic: | |||||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ (0.04) | ||||
Weighted-average shares outstanding - basic: | |||||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 0 | ||||
Net income (loss) per share - diluted: | |||||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ (0.04) | ||||
Weighted-average shares outstanding - diluted: | |||||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 0 | ||||
Adjustments | Class B Common Stock | |||||
Net income (loss) per share - basic: | |||||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ (0.04) | ||||
Weighted-average shares outstanding - basic: | |||||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 0 | ||||
Net income (loss) per share - diluted: | |||||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ (0.04) | ||||
Weighted-average shares outstanding - diluted: | |||||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 0 |
Description of Business and S_6
Description of Business and Summary of Significant Accounting Policies - Schedule of Cash and Cash Equivalents and Restricted Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 257,223 | $ 24,453 | $ 204,998 | |
Restricted cash and restricted cash equivalents | 116,357 | 8,824 | 2,749 | |
Ending balance | $ 373,580 | $ 33,277 | $ 207,747 | $ 48,736 |
Description of Business and S_7
Description of Business and Summary of Significant Accounting Policies - Supplementary Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounting Policies [Line Items] | |||
Interest paid, net of interest income received | $ 452,105 | $ 456,509 | $ 510,185 |
Payments (refunds) on income taxes, net | 22,654 | 1,877 | 25,802 |
Issuance of shares for acquisition of business | 55,485 | 528,503 | 113,841 |
Contingent forward purchase contract | 41,938 | $ 0 | $ 0 |
Solar | Common Stock | |||
Accounting Policies [Line Items] | |||
Amount of shares issued for acquisition | $ 40,000 |
Description of Business and S_8
Description of Business and Summary of Significant Accounting Policies - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Line Items] | ||
Prepaid expenses | $ 28,648 | $ 30,373 |
Contract assets (see Note 2 "Revenue and Receivables") | 33,632 | 58,452 |
Fair value of interest rate swaps (see Note 8 "Derivative Financial Instruments") | 78,110 | 0 |
Other receivables(1) | 122,476 | 23,211 |
Other current assets | 77,982 | 57,209 |
Prepaid expenses and other current assets | 340,848 | $ 169,245 |
Solar | ||
Accounting Policies [Line Items] | ||
Loans subject to temporary clawback, liability, current | $ 88,000 |
Description of Business and S_9
Description of Business and Summary of Significant Accounting Policies - Property Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Finance leases | $ 199,487 | $ 166,925 | |
Accumulated depreciation | (735,293) | (651,627) | |
Property and equipment, net | 375,968 | 364,108 | |
Depreciation expense | 206,709 | 197,202 | $ 187,386 |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 13,052 | 13,120 | |
Buildings and leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 40 years | ||
Property, plant and equipment, gross | $ 115,887 | 112,475 | |
Capitalized software | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 560,581 | 491,184 | |
Capitalized software | Minimum | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 3 years | ||
Capitalized software | Maximum | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 10 years | ||
Machinery, equipment, and other | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, useful life | 10 years | ||
Property, plant and equipment, gross | $ 205,828 | 205,696 | |
Construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $ 16,426 | $ 26,335 |
Description of Business and _10
Description of Business and Summary of Significant Accounting Policies - Subscriber System Assets and Depreciation Amortization (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounting Policies [Abstract] | |||
Gross carrying amount | $ 6,205,762 | $ 5,499,703 | |
Accumulated depreciation | (3,144,459) | (2,632,175) | |
Subscriber system assets, net | 3,061,303 | 2,867,528 | |
Depreciation of subscriber system assets | 551,260 | 506,568 | $ 501,669 |
Amortization of deferred subscriber acquisition costs | $ 162,981 | $ 126,089 | $ 96,823 |
Description of Business and _11
Description of Business and Summary of Significant Accounting Policies - Schedule of Accrued Expenses and Radio Conversion Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | |||
Accrued interest | $ 156,495 | $ 124,579 | |
Payroll-related accruals | 208,111 | 196,165 | |
Operating lease liabilities | 28,696 | 37,359 | |
Fair value of interest rate swaps | 899,780 | 737,245 | |
Opportunity Fund | 100,802 | 0 | |
Other accrued liabilities | 405,676 | 328,782 | |
Accrued expenses and other current liabilities | 899,780 | 737,245 | |
Radio conversion costs | 31,428 | 250,490 | $ 88,709 |
Radio conversion revenue | 28,075 | 39,127 | $ 36,820 |
Interest Rate Swap | Not Designated as Hedging Instrument | |||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | |||
Fair value of interest rate swaps | 0 | 50,360 | |
Accrued expenses and other current liabilities | $ 0 | $ 50,360 |
Description of Business and _12
Description of Business and Summary of Significant Accounting Policies - Schedule of Fair Value of Retail Installment Contract Receivables and Long-Term Debt Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Reported Value Measurement | ||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | ||
Long-term debt instruments, excluding finance lease obligations, subject to fair value disclosures | $ 9,733,700 | $ 9,599,610 |
Estimate of Fair Value Measurement | ||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | ||
Long-term debt instruments, excluding finance lease obligations, subject to fair value disclosures | 9,312,932 | 10,043,877 |
Retail installment contract receivables, net | ||
Fair Value Disclosure, Asset and Liability, Not Measured at Fair Value [Line Items] | ||
Carrying Amount | 531,516 | 330,605 |
Fair Value | $ 385,114 | $ 255,147 |
Revenue and Receivables - Disag
Revenue and Receivables - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | $ 6,395,310 | $ 5,307,111 | $ 5,314,787 |
CSB | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 4,378,805 | 4,146,028 | 4,325,189 |
Commercial | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 1,230,079 | 1,113,732 | 989,598 |
Solar | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 786,426 | 47,351 | 0 |
Monitoring and related services | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 4,589,265 | 4,347,713 | 4,186,987 |
Monitoring and related services | CSB | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 4,050,019 | 3,873,285 | 3,760,614 |
Monitoring and related services | Commercial | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 539,246 | 474,428 | 426,373 |
Security installation, product, and other | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 1,019,619 | 912,047 | 1,127,800 |
Security installation, product, and other | CSB | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 328,786 | 272,743 | 564,575 |
Security installation, product, and other | Commercial | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 690,833 | 639,304 | 563,225 |
Solar installation, product, and other | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 786,426 | $ 47,351 | $ 0 |
Solar Equipment | |||
Disaggregation of Revenue [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | $ 451,000 |
Revenue and Receivables - Amort
Revenue and Receivables - Amortization of Deferred Subscriber Acquisition Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |||
Amortization of deferred subscriber acquisition costs | $ 244,141 | $ 172,061 | $ 124,804 |
Revenue and Receivables - Narra
Revenue and Receivables - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Capitalized Contract Cost [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | $ 6,395,310 | $ 5,307,111 | $ 5,314,787 |
Installation and other revenue fees, other | 141,000 | ||
Provision for credit losses | 99,760 | 51,877 | 81,713 |
Contract with customer, asset recognized | 17,000 | 26,000 | 183,000 |
Solar | |||
Capitalized Contract Cost [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 786,426 | 47,351 | $ 0 |
Provision for credit losses | 21,000 | ||
Solar Equipment | |||
Capitalized Contract Cost [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 451,000 | ||
Cost of revenue | 292,000 | ||
Variable Interest Entity, Primary Beneficiary | |||
Capitalized Contract Cost [Line Items] | |||
Transfers accounted for as secured borrowings, assets, carrying amount | $ 506,000 | $ 299,000 |
Revenue and Receivables - Allow
Revenue and Receivables - Allowance for Credit Loss Rollforward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Beginning balance | $ 54,032 | $ 68,342 | $ 42,960 |
Provision for credit losses | 99,760 | 51,877 | 81,713 |
Write-offs, net of recoveries | (88,137) | (66,187) | (56,331) |
Ending balance | $ 65,655 | $ 54,032 | $ 68,342 |
Revenue and Receivables - Sched
Revenue and Receivables - Schedule of Unbilled Retail Installment Contract Receivables, Net (Details) - Retail installment contract receivables, net - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Capitalized Contract Cost [Line Items] | ||
Retail installment contract receivables, gross | $ 532,406 | $ 331,512 |
Allowance for credit losses | (890) | (907) |
Retail installment contract receivables, net | 531,516 | 330,605 |
Accounts receivable, net | ||
Capitalized Contract Cost [Line Items] | ||
Retail installment contract receivables, net | 169,242 | 100,385 |
Other assets | ||
Capitalized Contract Cost [Line Items] | ||
Retail installment contract receivables, net | $ 362,274 | $ 230,220 |
Revenue and Receivables - Summa
Revenue and Receivables - Summary of Contract Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Capitalized Contract Cost [Line Items] | ||
Contract assets, gross | $ 54,305 | $ 106,810 |
Allowance for credit losses | (5,453) | (12,300) |
Contract with customer, asset, after allowance for credit loss | 48,852 | 94,510 |
Prepaid expenses and other current assets | ||
Capitalized Contract Cost [Line Items] | ||
Contract with customer, asset, after allowance for credit loss | 33,632 | 58,452 |
Other assets | ||
Capitalized Contract Cost [Line Items] | ||
Contract with customer, asset, after allowance for credit loss | $ 15,220 | $ 36,058 |
Segment Information - Narrative
Segment Information - Narrative (Details) | 12 Months Ended |
Dec. 31, 2022 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Number of operating segments | 3 |
Segment Information - Schedule
Segment Information - Schedule of Total Revenue by Segment and Reconciliation to Consolidated Total Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | $ 6,395,310 | $ 5,307,111 | $ 5,314,787 |
CSB | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 4,378,805 | 4,146,028 | 4,325,189 |
Commercial | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | 1,230,079 | 1,113,732 | 989,598 |
Solar | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Revenue from contract with customer, excluding assessed tax | $ 786,426 | $ 47,351 | $ 0 |
Segment Information - Schedul_2
Segment Information - Schedule of Segment Information EBITDA Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Interest expense, net | $ (265,285) | $ (457,667) | $ (708,189) | |
Depreciation and intangible asset amortization | 1,693,575 | 1,914,779 | 1,913,767 | |
Amortization of deferred subscriber acquisition costs | 162,981 | 126,089 | 96,823 | |
Amortization of deferred subscriber acquisition revenue | (244,141) | (172,061) | (124,804) | |
Share-based compensation expense | 66,566 | 61,237 | 96,013 | |
Merger, restructuring, integration, and other | 22,232 | 37,872 | 120,208 | |
Goodwill impairment | $ 201,000 | 200,974 | 0 | 0 |
Loss on extinguishment of debt | 0 | 37,113 | 119,663 | |
Equity in net earnings (losses) of equity method investee | (4,601) | 0 | 0 | |
Income (loss) before income taxes and equity in net earnings (losses) of equity method investee | 185,814 | (471,189) | (778,919) | |
Increase (decrease) in notes receivables | 10,000 | |||
CSB | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Goodwill impairment | 0 | |||
Commercial | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Goodwill impairment | 0 | |||
Solar | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Goodwill impairment | 200,974 | |||
Operating Segments | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total segment Adjusted EBITDA | 2,446,728 | 2,212,579 | 2,199,237 | |
Operating Segments | CSB | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total segment Adjusted EBITDA | 2,314,633 | 2,110,879 | 2,153,899 | |
Operating Segments | Commercial | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total segment Adjusted EBITDA | 126,940 | 96,112 | 45,338 | |
Operating Segments | Solar | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Total segment Adjusted EBITDA | 5,155 | 5,588 | 0 | |
Segment Reconciling Items | ||||
Segment Reporting, Asset Reconciling Item [Line Items] | ||||
Interest expense, net | 265,285 | 457,667 | 708,189 | |
Depreciation and intangible asset amortization | 1,693,575 | 1,914,779 | 1,913,767 | |
Amortization of deferred subscriber acquisition costs | 162,981 | 126,089 | 96,823 | |
Amortization of deferred subscriber acquisition revenue | (244,141) | (172,061) | (124,804) | |
Share-based compensation expense | 66,566 | 61,237 | 96,013 | |
Merger, restructuring, integration, and other | 22,232 | 37,872 | 120,208 | |
Goodwill impairment | 200,974 | 0 | 0 | |
Loss on extinguishment of debt | 0 | 37,113 | 119,663 | |
Change in fair value of financial instruments | 63,396 | 0 | 0 | |
Radio conversion costs, net | 3,353 | 211,363 | 51,889 | |
Acquisition related adjustments | 35,229 | 12,945 | 438 | |
Equity in net earnings (losses) of equity method investee | (4,601) | 0 | 0 | |
Other | $ (3,935) | $ (3,236) | $ (4,030) |
Acquisitions and Disposition -
Acquisitions and Disposition - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 | Dec. 31, 2021 | Jan. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | |||||||
Acquisition of businesses, net of cash acquired | $ 13,095 | $ 163,503 | $ 224,617 | ||||
Issuance of shares for acquisition of business | 55,485 | 528,503 | 113,841 | ||||
Revenue from contract with customer, excluding assessed tax | 6,395,310 | 5,307,111 | 5,314,787 | ||||
Net income (loss) | 132,663 | (340,820) | (632,193) | ||||
Goodwill | $ 5,943,403 | 5,767,016 | 5,943,403 | 5,236,302 | |||
Merger, restructuring, integration, and other | 22,232 | $ 37,872 | 120,208 | ||||
Discontinued Operations, Disposed of by Sale | |||||||
Business Acquisition [Line Items] | |||||||
Proceeds from divestiture of interest in subsidiaries and affiliates | 27,000 | ||||||
Equity method investment, realized gain on disposal | $ 10,000 | ||||||
Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Business combination, common shares issued (in shares) | 2 | ||||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Sunpro Solar | |||||||
Business Acquisition [Line Items] | |||||||
Business combination, consideration transferred | $ 750,000 | ||||||
Acquisition of businesses, net of cash acquired | $ 142,000 | ||||||
Common stock, par value (in dollars per share) | $ 0.01 | ||||||
Issuance of shares for acquisition of business | $ 569,000 | ||||||
Revenue from contract with customer, excluding assessed tax | $ 47,000 | ||||||
Net income (loss) | $ 7,000 | ||||||
Goodwill | $ 712,150 | ||||||
Sunpro Solar | Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Business combination, common shares issued (in shares) | 75 | 70 | |||||
Solar | |||||||
Business Acquisition [Line Items] | |||||||
Business combination, consideration transferred | $ 31,000 | $ 21,000 | |||||
Goodwill | $ 20,000 | ||||||
Solar | Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Business acquisition, equity interest issued or issuable (in shares) | (15) | ||||||
Solar | Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Amount of shares issued for acquisition | $ 40,000 | ||||||
Shares unissued for acquisition (in shares) | 5.3 | ||||||
Defender Holdings, Inc | |||||||
Business Acquisition [Line Items] | |||||||
Business combination, consideration transferred | $ 290,000 | ||||||
Acquisition of businesses, net of cash acquired | $ 173,000 | ||||||
Common stock, par value (in dollars per share) | $ 10 | ||||||
Issuance of shares for acquisition of business | $ 114,000 | ||||||
Goodwill | $ 252,000 | ||||||
Merger, restructuring, integration, and other | $ 81,000 | ||||||
Defender Holdings, Inc | Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Business combination, common shares issued (in shares) | 16 | ||||||
Issuance of shares for acquisition of business | $ 114,000 | ||||||
Series of Individually Immaterial Business Acquisitions | |||||||
Business Acquisition [Line Items] | |||||||
Acquisition of businesses, net of cash acquired | 52,000 | ||||||
Goodwill | 24,000 | ||||||
Payments to acquire businesses, gross | 80,000 | ||||||
Other intangible assets related to developed technology | 43,000 | ||||||
Series of Individually Immaterial Business Acquisitions | Customer Relationships | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill | $ 13,000 |
Acquisitions and Disposition _2
Acquisitions and Disposition - Schedule of Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||
Goodwill | $ 5,767,016 | $ 5,943,403 | $ 5,236,302 |
Sunpro Solar | |||
Business Acquisition [Line Items] | |||
Cash | 38,493 | ||
Accounts receivable | 35,849 | ||
Inventories | 49,526 | ||
Prepaid expenses and other current assets | 12,616 | ||
Property and equipment | 10,047 | ||
Goodwill | 712,150 | ||
Other assets | 27,653 | ||
Accounts payable | (54,223) | ||
Deferred revenue | (45,966) | ||
Accrued expenses and other current liabilities | (45,391) | ||
Current maturities of long-term debt | (7,643) | ||
Other liabilities | (9,370) | ||
Long-term debt | (15,112) | ||
Total consideration transferred | 750,429 | ||
Finite-Lived Intangible Assets | Sunpro Solar | |||
Business Acquisition [Line Items] | |||
Other definite-lived intangible assets | $ 41,800 |
Acquisitions and Disposition _3
Acquisitions and Disposition - Summary of Business Acquisition, Pro Forma Information (Details) - Sunpro Solar - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Business Acquisition [Line Items] | ||
Total revenue | $ 5,905,148 | $ 5,590,880 |
Net income (loss) | $ (328,099) | $ (680,992) |
Equity Method Investments (Deta
Equity Method Investments (Details) - Canopy - USD ($) $ in Millions | 1 Months Ended | |
Apr. 30, 2022 | Dec. 31, 2022 | |
Schedule of Equity Method Investments [Line Items] | ||
Expected payments to acquire equity method investments | $ 100 | |
Equity method investments, investment period | 3 years | |
Equity method investment, ownership percentage | 40% | |
Payments to acquire equity method investments | $ 11 | |
Variable Interest Entity, Not Primary Beneficiary | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity method investments | $ 7 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | $ 5,943,403 | $ 5,236,302 | ||
Acquisitions | 36,318 | 707,101 | ||
Impairment | $ (201,000) | (200,974) | 0 | $ 0 |
Disposition | (11,731) | |||
Goodwill, ending balance | 5,767,016 | 5,943,403 | 5,236,302 | |
Sunpro Solar | ||||
Goodwill [Roll Forward] | ||||
Goodwill, ending balance | 712,150 | |||
CSB | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 4,906,666 | 4,906,691 | ||
Acquisitions | 12,585 | (25) | ||
Impairment | 0 | |||
Disposition | 0 | |||
Goodwill, ending balance | 4,919,251 | 4,906,666 | 4,906,691 | |
Commercial | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 342,011 | 329,611 | ||
Acquisitions | 6,309 | 12,400 | ||
Impairment | 0 | |||
Disposition | (11,731) | |||
Goodwill, ending balance | 336,589 | 342,011 | 329,611 | |
Solar | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 694,726 | 0 | ||
Acquisitions | 17,424 | 694,726 | ||
Impairment | (200,974) | |||
Disposition | 0 | |||
Goodwill, ending balance | $ 511,176 | $ 694,726 | $ 0 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Gross Carrying Amounts and Accumulated Amortization of Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Definite-lived intangible assets: | |||
Gross Carrying Amount | $ 8,764,108 | $ 10,500,516 | |
Accumulated Amortization | (5,005,361) | (6,420,165) | |
Net Carrying Amount | 3,758,747 | 4,080,351 | |
Indefinite-lived intangible assets: | |||
Total intangible assets, gross carrying amount | 10,097,108 | 11,833,516 | |
Total finite-lived intangible assets, accumulated amortization | (5,005,361) | (6,420,165) | |
Total intangible assets, net carrying amount | 5,091,747 | 5,413,351 | |
Acquired intangible assets, fully amortized amount | 2,300,000 | ||
Customer-Related Intangible Assets | |||
Definite-lived intangible assets: | |||
Gross Carrying Amount | 7,021,305 | 8,719,363 | |
Accumulated Amortization | (4,262,383) | (5,753,345) | |
Net Carrying Amount | 2,758,922 | 2,966,018 | $ 3,374,156 |
Indefinite-lived intangible assets: | |||
Total finite-lived intangible assets, accumulated amortization | $ (4,262,383) | $ (5,753,345) | |
Contracts and related customer relationship useful life (in years) | 14 years | 14 years | |
Dealer Relationships | |||
Definite-lived intangible assets: | |||
Gross Carrying Amount | $ 1,518,020 | $ 1,518,020 | |
Accumulated Amortization | (538,801) | (459,248) | |
Net Carrying Amount | 979,219 | 1,058,772 | |
Indefinite-lived intangible assets: | |||
Total finite-lived intangible assets, accumulated amortization | $ (538,801) | (459,248) | |
Contracts and related customer relationship useful life (in years) | 19 years | ||
Other | |||
Definite-lived intangible assets: | |||
Gross Carrying Amount | $ 224,783 | 263,133 | |
Accumulated Amortization | (204,177) | (207,572) | |
Net Carrying Amount | 20,606 | 55,561 | |
Indefinite-lived intangible assets: | |||
Total finite-lived intangible assets, accumulated amortization | $ (204,177) | (207,572) | |
Contracts and related customer relationship useful life (in years) | 10 years | ||
Trade Names | |||
Indefinite-lived intangible assets: | |||
Trade name | $ 1,333,000 | $ 1,333,000 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Sep. 30, 2022 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Oct. 01, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill impairment | $ 201,000,000 | $ 200,974,000 | $ 0 | $ 0 | ||
Goodwill, impaired, accumulated impairment loss | 0 | 0 | ||||
Accelerated method, average declining balance rate | 250% | |||||
Dealer generated customer accounts and bulk account purchases | $ 621,695,000 | 675,118,000 | $ 380,716,000 | |||
Reporting unit, percentage of fair value in excess of carrying amount | 50% | |||||
Impairment of intangible assets, finite-lived | $ 18,000,000 | |||||
Impairment of intangible asset finite lived statement of income or comprehensive income extensible enumeration not disclosed flag | true | |||||
Solar | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Goodwill impairment | $ 200,974,000 | |||||
First Five Years | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Accelerated method, average amortization rate | 55% | |||||
Second Five Years | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Accelerated method, average amortization rate | 25% | |||||
Final Five Years | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Accelerated method, average amortization rate | 20% | |||||
Customer Relationships | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Contracts and related customer relationship useful life (in years) | 20 years | |||||
Customer Contracts | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Contracts and related customer relationship useful life (in years) | 15 years | |||||
Accelerated method, average declining balance rate | 300% | |||||
Dealer generated customer accounts and bulk account purchases | $ 82,000,000 | $ 132,000,000 | ||||
Customer Contracts | First Five Years | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Accelerated method, average amortization rate | 65% | |||||
Customer Contracts | Second Five Years | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Accelerated method, average amortization rate | 25% | |||||
Customer Contracts | Final Five Years | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Accelerated method, average amortization rate | 10% | |||||
Customer-Related Intangible Assets | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Contracts and related customer relationship useful life (in years) | 14 years | 14 years | ||||
Dealer generated customer accounts and bulk account purchases | $ 111,000,000 | $ 163,000,000 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Changes in Net Carrying Amount of Contracts and Related Customer Relationships (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Finite-lived Intangible Assets [Roll Forward] | |||
Beginning balance | $ 4,080,351 | ||
Amortization | (934,700) | $ (1,209,966) | $ (1,222,398) |
Ending balance | 3,758,747 | 4,080,351 | |
Customer-Related Intangible Assets | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Beginning balance | 2,966,018 | 3,374,156 | |
Amortization | (841,899) | (1,109,787) | |
Other | (1,639) | 0 | |
Ending balance | 2,758,922 | 2,966,018 | $ 3,374,156 |
Customer Relationships | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Acquisition of customer relationships and contract additions | 3,000 | 5,333 | |
Customer Contracts | |||
Finite-lived Intangible Assets [Roll Forward] | |||
Acquisition of customer relationships and contract additions | $ 633,442 | $ 696,316 |
Goodwill and Other Intangible_7
Goodwill and Other Intangible Assets - Schedule of Finite-Lived Intangible Assets, Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Definite-lived intangible asset amortization expense | $ 934,700 | $ 1,209,966 | $ 1,222,398 |
Goodwill and Other Intangible_8
Goodwill and Other Intangible Assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 | $ 597,695 |
2024 | 484,023 |
2025 | 422,112 |
2026 | 372,228 |
2027 | 337,209 |
Thereafter | $ 1,545,480 |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | Jul. 31, 2021 | Aug. 31, 2020 | Jan. 31, 2020 |
Debt Instrument [Line Items] | ||||||
Total debt principal, excluding finance leases | $ 9,937,368 | $ 9,836,758 | ||||
Plus: Finance lease obligations | 94,888 | 93,080 | ||||
Less: Unamortized debt discount, net | (13,415) | (16,678) | ||||
Less: Unamortized deferred financing costs | (50,896) | (64,014) | ||||
Less: Unamortized purchase accounting fair value adjustment and other | (139,357) | (156,456) | ||||
Total debt | 9,828,588 | 9,692,690 | ||||
Less: Current maturities of long-term debt, net of unamortized debt discount | (871,917) | (117,592) | ||||
Long-Term Debt, Excluding Current Maturities | 8,956,671 | 9,575,098 | ||||
Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Other debt | 2,446 | 4,732 | ||||
First Lien Term Loan due 2026 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 2,730,269 | $ 2,758,058 | ||||
First Lien Term Loan due 2026 | Secured Debt | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 2.75% | 2.75% | ||||
First Lien Revolving Credit Facility | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 0 | $ 25,000 | ||||
First Lien Revolving Credit Facility | Secured Debt | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 2.75% | 2.75% | ||||
Second Lien Notes due 2028 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 6.25% | 6.25% | 6.25% | |||
Long-term debt, gross | $ 1,300,000 | $ 1,300,000 | ||||
First Lien Notes due 2024 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 5.25% | 5.25% | ||||
Long-term debt, gross | $ 750,000 | $ 750,000 | ||||
First Lien Notes due 2026 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 5.75% | 5.75% | ||||
Long-term debt, gross | $ 1,350,000 | $ 1,350,000 | ||||
First Lien Notes due 2027 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 3.375% | 3.375% | 3.375% | |||
Long-term debt, gross | $ 1,000,000 | $ 1,000,000 | ||||
First Lien Notes due 2029 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 4.125% | 4.125% | 4.125% | |||
Long-term debt, gross | $ 1,000,000 | $ 1,000,000 | ||||
ADT Notes due 2023 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | 700,000 | |||||
ADT Notes due 2023 | Notes Payable to Banks | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 4.125% | |||||
Long-term debt, gross | $ 700,000 | $ 700,000 | ||||
ADT Notes due 2032 | Notes Payable to Banks | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 4.875% | 4.875% | ||||
Long-term debt, gross | $ 728,016 | $ 728,016 | ||||
ADT Notes due 2042 | Notes Payable to Banks | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 4.875% | 4.875% | ||||
Long-term debt, gross | $ 21,896 | $ 21,896 | ||||
Receivables Facility | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 354,741 | $ 199,056 | ||||
Receivables Facility | Secured Debt | Secured Overnight Financing Rate (SOFR) | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 0.85% | 0.85% |
Debt - First Lien Credit Agreem
Debt - First Lien Credit Agreement (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Jan. 27, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Jul. 02, 2021 | Dec. 31, 2020 | Sep. 23, 2019 | |
First Lien Credit Agreement | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Available borrowing capacity | $ 575,000 | |||||
First Lien Credit Agreement | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 1% | |||||
First Lien Credit Agreement | Line of Credit | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, periodic payment, principal | $ 7,000 | |||||
Floor rate, percentage | 0.75% | |||||
First Lien Credit Agreement | Line of Credit | Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, repurchased face amount | $ 575,000 | $ 175,000 | ||||
Debt instrument, face amount | $ 550,000 | |||||
First Lien Credit Agreement | Line of Credit | Revolving Credit Facility | Solar | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, repurchased face amount | $ 160,000 | |||||
Debt instrument, face amount | 185,000 | |||||
First Lien Credit Agreement | Line of Credit | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Floor rate, percentage | 1% | |||||
Line of credit facility, unused capacity, commitment fee percentage | 0.375% | |||||
First Lien Credit Agreement | Line of Credit | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Floor rate, percentage | 0.75% | |||||
Line of credit facility, unused capacity, commitment fee percentage | 0.50% | |||||
First Lien Credit Agreement | Line of Credit | Federal Funds Rate | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 0.50% | |||||
First Lien Credit Agreement | Line of Credit | Base Rate | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 1.75% | |||||
First Lien Credit Agreement | Line of Credit | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 2.75% | |||||
First Lien Credit Agreement | Line of Credit | London Interbank Offered Rate (LIBOR) | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 3.25% | |||||
First Lien Credit Agreement | Line of Credit | London Interbank Offered Rate (LIBOR) | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 2.75% | |||||
First Lien Term B1 Loan | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, repurchased face amount | $ 300,000 | |||||
Long-term debt, gross | 3,400,000 | |||||
First Lien Term Loan due 2026 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, repurchased face amount | $ 300,000 | |||||
Long-term debt, gross | $ 2,730,269 | $ 2,758,058 | ||||
Debt instrument, face amount | $ 3,100,000 | |||||
Debt issuance discount, percentage | 1% |
Debt - Term Loan A Facility (De
Debt - Term Loan A Facility (Details) $ in Millions | 1 Months Ended |
Sep. 30, 2022 USD ($) | |
Term Loan A Facility | Secured Debt | |
Debt Instrument [Line Items] | |
Debt instrument, face amount | $ 600 |
Long-term debt, term | 5 years |
Number of springing maturity dates | 91 days |
Debt instrument, covenant, springing maturity indebtedness threshold | $ 100 |
Debt instrument, quarterly repayment, percentage | 5% |
Base rate, percentage | 1.50% |
Term Loan A Facility | Secured Debt | Adjusted Secured Overnight Financing Rate | |
Debt Instrument [Line Items] | |
Base rate, percentage | 0.10% |
Term Loan A Facility | Secured Debt | Federal Funds Rate | |
Debt Instrument [Line Items] | |
Base rate, percentage | 0.50% |
Term Loan A Facility | Secured Debt | Base Rate | |
Debt Instrument [Line Items] | |
Base rate, percentage | 1% |
Term Loan A Facility | Secured Debt | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |
Debt Instrument [Line Items] | |
Base rate, percentage | 2.50% |
ADT Notes due 2023 | Notes Payable to Banks | |
Debt Instrument [Line Items] | |
Interest rate | 4.125% |
Debt - Second Lien Notes due 20
Debt - Second Lien Notes due 2028 (Details) - Secured Debt - USD ($) $ in Billions | 12 Months Ended | |||||
Jan. 25, 2025 | Jan. 15, 2024 | Jan. 15, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Jan. 31, 2020 | |
Second Lien Notes due 2028 | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 1.3 | |||||
Interest rate | 6.25% | 6.25% | 6.25% | |||
Redemption price, maximum percentage | 101% | |||||
Second Lien Notes due 2028 | Forecast | Debt Instrument, Redemption, On or After 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price, maximum percentage | 103.125% | |||||
Second Lien Notes due 2028 | Forecast | Debt Instrument, Redemption, On or After 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price, maximum percentage | 101.563% | |||||
Second Lien Notes due 2028 | Forecast | Debt Instrument, Redemption, On or After 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price, maximum percentage | 100% | |||||
Prime Notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 1.2 | |||||
Interest rate | 9.25% |
Debt - First Lien Notes due 202
Debt - First Lien Notes due 2024 and First Lien Notes due 2026 (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
First Lien Notes due 2024 | Secured Debt | ||
Debt Instrument [Line Items] | ||
Interest rate | 5.25% | 5.25% |
First Lien Notes due 2026 | ||
Debt Instrument [Line Items] | ||
Redemption price, maximum percentage | 101% | |
First Lien Notes due 2026 | Secured Debt | ||
Debt Instrument [Line Items] | ||
Interest rate | 5.75% | 5.75% |
Debt - First Lien Notes due 2_2
Debt - First Lien Notes due 2027 and First Lien Notes due 2029 (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Aug. 01, 2028 | Aug. 31, 2026 | Jul. 31, 2021 | Aug. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | |
First Lien Notes due 2027 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 1,000,000 | |||||
Interest rate | 3.375% | 3.375% | 3.375% | |||
Long-term debt, gross | $ 1,000,000 | $ 1,000,000 | ||||
Redemption price, maximum percentage | 101% | |||||
First Lien Notes due 2027 | Secured Debt | Forecast | Debt Instrument, Redemption, On or After 2026 | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price, maximum percentage | 100% | |||||
ADT Notes due 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 6.25% | |||||
Long-term debt, gross | $ 1,000,000 | |||||
First Lien Notes due 2029 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 1,000,000 | |||||
Interest rate | 4.125% | 4.125% | 4.125% | |||
Long-term debt, gross | $ 1,000,000 | $ 1,000,000 | ||||
Redemption price, maximum percentage | 101% | |||||
First Lien Notes due 2029 | Secured Debt | Debt Instrument, Redemption, Prior to 2028 | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price, maximum percentage | 100% | |||||
Debt instrument, interest Rate, adjusted treasury rate | 50 | |||||
First Lien Notes due 2029 | Secured Debt | Forecast | Debt Instrument, Redemption, On or After 2028 | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price, maximum percentage | 100% |
Debt - ADT Notes (Details)
Debt - ADT Notes (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Mar. 15, 2023 | Aug. 31, 2021 | Sep. 30, 2020 | Dec. 31, 2022 | Aug. 31, 2020 | |
ADT Notes due 2022 | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Redemption price, maximum percentage | 101% | ||||
Debt instrument, face amount | $ 1,000 | ||||
Interest rate | 3.50% | ||||
Payment for debt extinguishment or debt prepayment cost | $ 28 | ||||
ADT Notes due 2021 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 6.25% | ||||
Long-term debt, gross | $ 1,000 | ||||
ADT Notes due 2021 | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, repurchased face amount | $ 1,000 | ||||
Repayments of senior debt | $ 1,100 | ||||
ADT Notes due 2023 | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Long-term debt, gross | $ 700 | ||||
ADT Notes due 2023 | Secured Debt | Forecast | |||||
Debt Instrument [Line Items] | |||||
Extinguishment of debt, amount | $ 600 |
Debt - Receivables Facility (De
Debt - Receivables Facility (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||||
Oct. 31, 2021 USD ($) lender | Mar. 31, 2021 | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Oct. 28, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||||
Proceeds from receivables facility | $ 276,826 | $ 253,546 | $ 82,517 | |||
Repayment of receivables facility | 121,061 | 130,345 | $ 6,742 | |||
Non-cash impact from receivable facility amendment | $ 88,000 | |||||
Variable Interest Entity, Primary Beneficiary | ||||||
Debt Instrument [Line Items] | ||||||
Transfers accounted for as secured borrowings, assets, carrying amount | 506,000 | $ 299,000 | ||||
Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Number of lenders | lender | 2 | |||||
Receivables Facility | ||||||
Debt Instrument [Line Items] | ||||||
Receivables facility maximum limit | $ 200,000 | $ 400,000 | ||||
Available borrowing capacity | $ 45,000 | |||||
Minimum | Receivables Facility | Secured Debt | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 1% | |||||
Maximum | Receivables Facility | Secured Debt | London Interbank Offered Rate (LIBOR) | ||||||
Debt Instrument [Line Items] | ||||||
Base rate, percentage | 0.85% |
Debt - Debt Covenants and Loss
Debt - Debt Covenants and Loss on Extinguishment of Debt (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||
Dec. 31, 2020 | Sep. 30, 2020 | Feb. 29, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jul. 02, 2021 | Aug. 31, 2020 | Jan. 31, 2020 | |
Debt Instrument [Line Items] | |||||||||
Loss on extinguishment of debt | $ 0 | $ 37,113 | $ 119,663 | ||||||
Prime Notes | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, repurchased face amount | $ 1,200,000 | ||||||||
Interest rate | 9.25% | ||||||||
Prime Notes | Secured Debt | Prime Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Loss on extinguishment of debt | $ 66,000 | ||||||||
ADT Notes due 2021 | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate | 6.25% | ||||||||
ADT Notes due 2021 | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, repurchased face amount | $ 1,000,000 | ||||||||
ADT Notes due 2021 | Secured Debt | ADT Notes due 2021 | |||||||||
Debt Instrument [Line Items] | |||||||||
Loss on extinguishment of debt | $ 49,000 | ||||||||
First Lien Term Loan due 2026 | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Loss on extinguishment of debt | $ 5,000 | ||||||||
Debt instrument, repurchased face amount | $ 300,000 | $ 300,000 | |||||||
Revolving Credit Facility | First Lien Credit Agreement | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument leverage ratio percent | 30% | ||||||||
Debt instrument, repurchased face amount | $ 575,000 | $ 175,000 |
Debt - Schedule of Maturities o
Debt - Schedule of Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Debt principal | |||
2023 | $ 827,145 | ||
2024 | 880,053 | ||
2025 | 108,760 | ||
2026 | 4,051,137 | ||
2027 | 1,020,362 | ||
Thereafter | 3,049,911 | ||
Total debt principal | 9,937,368 | $ 9,836,758 | |
Interest expense, debt | $ 279,000 | $ 458,000 | $ 710,000 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Oct. 31, 2019 | Feb. 28, 2019 | Jan. 31, 2019 | Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, notional amount | $ 2,800,000 | $ 3,225,000 | ||||||
Interest rate cash flow hedge loss to be reclassified during next 12 Months, net | 19,000 | |||||||
Interest Rate Swap | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, notional amount | $ 3,000,000 | $ 3,500,000 | ||||||
Payments related to settlements of interest rate swaps | 19,000 | 56,000 | $ 38,000 | |||||
Interest Rate Swap | Cash Flow Hedges | Designated as Hedging Instrument | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, notional amount | $ 725,000 | $ 725,000 | $ 2,500,000 | |||||
Terminated Interest Rate Swap | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, notional amount | $ 3,800,000 | |||||||
Terminated Interest Rate Swap | Cash Flow Hedges | Designated as Hedging Instrument | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, notional amount | 2,800,000 | |||||||
October 2019 - Not Designated | Not Designated as Hedging Instrument | ||||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||||
Derivative, notional amount | $ 2,800,000 | $ 2,800,000 | $ 2,800,000 |
Derivative Financials Instrumen
Derivative Financials Instruments - Schedule of Derivative Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 31, 2019 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative, notional amount | $ 2,800,000 | $ 3,225,000 | |
January 2019 - Not Designated | Not Designated as Hedging Instrument | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative, notional amount | 0 | 125,000 | |
February 2019 - Not Designated | Not Designated as Hedging Instrument | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative, notional amount | 0 | 300,000 | |
October 2019 - Not Designated | Not Designated as Hedging Instrument | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Derivative, notional amount | $ 2,800,000 | $ 2,800,000 | $ 2,800,000 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Schedule of Derivative Liabilities at Fair Value (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Prepaid expenses and other current assets | $ 340,848 | $ 169,245 | |
Other assets | 723,568 | 462,941 | |
Accrued expenses and other current liabilities | 899,780 | 737,245 | |
Other liabilities | 271,842 | 300,693 | |
Unrealized (gain) loss on interest rate swap contracts | 301,851 | 157,505 | $ (60,363) |
Interest Rate Swap | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Unrealized (gain) loss on interest rate swap contracts | 301,851 | 157,505 | $ (60,363) |
Interest Rate Swap | Not Designated as Hedging Instrument | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Prepaid expenses and other current assets | 78,110 | 0 | |
Accrued expenses and other current liabilities | 0 | 50,360 | |
Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedges | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Other assets | 105,405 | 0 | |
Other liabilities | $ 0 | $ 67,976 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Changes in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Changes In Accumulated Other Comprehensive Loss [Roll Forward] | |||
Beginning balance | $ 3,248,719 | $ 3,039,336 | $ 3,184,369 |
Ending balance | 3,393,148 | 3,248,719 | 3,039,336 |
Cash Flow Hedges | |||
Changes In Accumulated Other Comprehensive Loss [Roll Forward] | |||
Beginning balance | (71,267) | (117,501) | (59,387) |
Pre-tax current period change | 33,946 | 60,948 | (76,807) |
Income tax benefit (expense) | (8,192) | (14,714) | 18,693 |
Ending balance | $ (45,513) | $ (71,267) | $ (117,501) |
Derivative Financial Instrume_6
Derivative Financial Instruments - Reclassification out of Accumulated Other Comprehensive Income (Details) - Accumulated Gain (Loss), Cash Flow Hedge, Including Noncontrolling Interest - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Interest expense, net | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Reclassification from accumulated other comprehensive income, current period, before tax | $ 33,946 | $ 60,948 | $ 54,452 |
Income tax (benefit) expense | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Reclassification from accumulated other comprehensive income, current period, before tax | $ (8,192) | $ (14,714) | $ (13,254) |
Income Taxes - Schedule of Loss
Income Taxes - Schedule of Loss before Income Taxes for Domestic and Foreign Locations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 183,101 | $ (473,504) | $ (782,256) |
Foreign | 2,713 | 2,315 | 3,337 |
Income (loss) before income taxes and equity in net earnings (losses) of equity method investee | $ 185,814 | $ (471,189) | $ (778,919) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ (184) | $ (174) | $ 370 |
State | (28,100) | (8,367) | (27,059) |
Foreign | (691) | (570) | 0 |
Current income tax benefit (expense) | (28,975) | (9,111) | (26,689) |
Deferred: | |||
Federal | (43,201) | 97,805 | 133,646 |
State | 24,029 | 41,901 | 39,842 |
Foreign | (403) | (226) | (73) |
Deferred income tax benefit (expense) | (19,575) | 139,480 | 173,415 |
Income tax benefit (expense) | $ (48,550) | $ 130,369 | $ 146,726 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Statutory federal tax rate | 21% | 21% | 21% |
Statutory state tax rate, net of federal benefits | 6.90% | 2.70% | 2.90% |
Non-deductible and non-taxable charges | 14.10% | 0.30% | (3.10%) |
Valuation allowance | (1.30%) | 0.50% | (1.50%) |
Prior year return adjustments | 2% | 0.40% | (0.30%) |
Federal credits | (6.40%) | 0% | 0% |
Acquisitions | (0.40%) | 1.30% | 0.20% |
Legislative changes | (4.50%) | 0.80% | 0% |
Uncertain tax positions | (4.90%) | 0% | 0% |
Other | (0.40%) | 0.70% | (0.40%) |
Effective tax rate | 26.10% | 27.70% | 18.80% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Accrued liabilities and reserves | $ 117,488 | $ 113,085 |
Tax loss and credit carryforwards | 468,209 | 594,821 |
Disallowed interest carryforward | 185,080 | 140,974 |
Deferred revenue | 187,766 | 140,604 |
Other | 95,008 | 101,886 |
Total deferred tax assets | 1,053,551 | 1,091,370 |
Valuation allowance | (57,715) | (60,157) |
Deferred tax assets, net of valuation allowance | 995,836 | 1,031,213 |
Deferred tax liabilities: | ||
Subscriber system assets | (766,067) | (729,548) |
Intangible assets | (1,023,895) | (1,139,927) |
Other | (97,772) | (27,442) |
Total deferred tax liabilities | (1,887,734) | (1,896,917) |
Net deferred tax assets (liabilities) | $ (891,898) | $ (865,704) |
Income Taxes - Summary of Valua
Income Taxes - Summary of Valuation Allowance (Details) - SEC Schedule, 12-09, Valuation Allowance, Deferred Tax Asset - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Beginning balance | $ (60,157) | $ (68,013) | $ (56,841) |
Income tax benefit (expense) | 2,428 | 2,378 | (11,999) |
Write-offs and other(1) | 14 | 5,478 | 827 |
Ending balance | $ (57,715) | $ (60,157) | $ (68,013) |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Billions | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets, operating loss carryforwards, subject to expiration | $ 1.6 | |
Deferred compensation arrangement with individual, cash awards granted, percentage | 50% |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits Roll Forward (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 66,221 | $ 65,990 | $ 65,117 |
Gross increase related to prior year tax positions | 5,063 | 373 | 1,348 |
Gross decrease related to prior year tax positions | 0 | 0 | (732) |
Increases related to acquisitions | 0 | 0 | 400 |
Decreases related to lapse of statute of limitation | (15,107) | (142) | (143) |
Ending balance | $ 56,177 | $ 66,221 | $ 65,990 |
Income Taxes - Summary of Open
Income Taxes - Summary of Open Tax Years (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Federal | Tax Year 2019 | |
Income Tax Examination [Line Items] | |
Years Open to Audit | 2019 |
Federal | Tax Year 2021 | |
Income Tax Examination [Line Items] | |
Years Open to Audit | 2021 |
State | Tax Year 2017 | |
Income Tax Examination [Line Items] | |
Years Open to Audit | 2017 |
State | Tax Year 2021 | |
Income Tax Examination [Line Items] | |
Years Open to Audit | 2021 |
Canada | Tax Year 2017 | |
Income Tax Examination [Line Items] | |
Years Open to Audit | 2017 |
Canada | Tax Year 2021 | |
Income Tax Examination [Line Items] | |
Years Open to Audit | 2021 |
Equity - Narrative (Details)
Equity - Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||||||||||||||
Feb. 28, 2023 $ / shares | Nov. 03, 2022 $ / shares | Oct. 13, 2022 USD ($) director $ / shares | Sep. 05, 2022 USD ($) $ / shares shares | Aug. 04, 2022 $ / shares | May 05, 2022 $ / shares | Mar. 01, 2022 $ / shares | Nov. 09, 2021 $ / shares | Aug. 04, 2021 $ / shares | May 05, 2021 $ / shares | Feb. 25, 2021 $ / shares | Jun. 30, 2022 shares | Sep. 30, 2020 USD ($) $ / shares shares | Jan. 31, 2020 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) $ / shares | Oct. 26, 2022 USD ($) | Sep. 12, 2022 $ / shares shares | Jan. 31, 2018 $ / shares | |
Class of Stock [Line Items] | ||||||||||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||||||||||||||
Preferred stock, shares authorized (in shares) | shares | 1,000,000 | 1,000,000 | 1,000,000 | |||||||||||||||||
Issuance of shares for acquisition of business | $ 55,485 | $ 528,503 | $ 113,841 | |||||||||||||||||
Stock repurchase program, number of shares authorized to be repurchased (in shares) | shares | 133,000,000 | 133,000,000 | ||||||||||||||||||
Stock repurchase program (in dollars per share) | $ / shares | $ 9 | |||||||||||||||||||
Forward share repurchase contract, value | $ 41,938 | 0 | 0 | |||||||||||||||||
Stock repurchase program, authorized amount | $ 1,200,000 | |||||||||||||||||||
Number of director, increase | director | 1 | |||||||||||||||||||
Equity method investments, termination -period | 3 years | |||||||||||||||||||
Number of days without designee | 5 days | |||||||||||||||||||
Opportunity funds, maximum investment amount | $ 300,000 | |||||||||||||||||||
Opportunity funds, investment amount received | $ 100,000 | |||||||||||||||||||
Right Of First Refusal (ROFR) | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Equity method investments, termination -period | 5 days | |||||||||||||||||||
Other Nonoperating Income (Expense) | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Change in fair value of financial instruments, current | 63,000 | |||||||||||||||||||
Additional Paid-In Capital | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Forward share repurchase contract, value | 41,938 | |||||||||||||||||||
Parent Company | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Issuance of shares for acquisition of business | $ 55,485 | $ 528,503 | $ 113,841 | |||||||||||||||||
Sunpro Solar | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | |||||||||||||||||||
Issuance of shares for acquisition of business | $ 569,000 | |||||||||||||||||||
Defender Holdings, Inc | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 10 | |||||||||||||||||||
Issuance of shares for acquisition of business | $ 114,000 | |||||||||||||||||||
Private Placement | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 133,000,000 | |||||||||||||||||||
Sale of stock, consideration received on transaction | $ 1,200,000 | |||||||||||||||||||
Sale of stock, price per share (in dollars per share) | $ / shares | $ 9 | $ 9 | ||||||||||||||||||
Class B Common Stock | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Common stock, shares authorized (in shares) | shares | 100,000,000 | 100,000,000 | 100,000,000 | |||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||||||
Sale of stock, number of shares issued in transaction (in shares) | shares | 54,744,525 | |||||||||||||||||||
Sale of stock, consideration received on transaction | $ 450,000 | |||||||||||||||||||
Fair value, measurement input, dividend yield | 1.50% | |||||||||||||||||||
Fair value, measurement input, expected share price volatility | 30% | |||||||||||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ / shares | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.140 | $ 0.140 | $ 0.07 | |||||||||
Dividends | $ 4,000 | |||||||||||||||||||
Class B Common Stock | Subsequent Event | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ / shares | $ 0.035 | |||||||||||||||||||
Common Stock | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Common stock, shares authorized (in shares) | shares | 3,999,000,000 | 3,999,000,000 | ||||||||||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||||||||||||||||||
Business combination, common shares issued (in shares) | shares | 2,000,000 | |||||||||||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ / shares | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.140 | $ 0.140 | $ 0.14 | |||||||||
Dividends | $ 108,000 | |||||||||||||||||||
Common Stock | Subsequent Event | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ / shares | $ 0.035 | |||||||||||||||||||
Common Stock | State Farm | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Equity method investment, ownership percentage | 18% | |||||||||||||||||||
Common Stock | State Farm | Right Of First Refusal (ROFR) | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Equity method investment, ownership percentage | 50% | |||||||||||||||||||
Common Stock | Prime Security Services TopCo Parent, L.P. | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Equity method investment, ownership percentage | 25% | |||||||||||||||||||
Common Stock | ADT | State Farm | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Noncontrolling interest, ownership percentage by noncontrolling owners | 15% | |||||||||||||||||||
Common Stock | Sunpro Solar | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Business combination, common shares issued (in shares) | shares | 75,000,000 | 70,000,000 | ||||||||||||||||||
Common Stock | Sunpro Solar | Parent Company | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Issuance of shares for acquisition of business | $ 529,000 | |||||||||||||||||||
Common Stock | Defender Holdings, Inc | ||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||
Business combination, common shares issued (in shares) | shares | 16,000,000 | |||||||||||||||||||
Issuance of shares for acquisition of business | $ 114,000 |
Equity - Schedule of Dividends
Equity - Schedule of Dividends Declared (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||||||||
Nov. 03, 2022 | Aug. 04, 2022 | May 05, 2022 | Mar. 01, 2022 | Nov. 09, 2021 | Aug. 04, 2021 | May 05, 2021 | Feb. 25, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Common Stock | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.140 | $ 0.140 | $ 0.14 |
Common Stock | Dividend Declared | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Dividends, common stock | $ 30,189 | $ 30,112 | $ 30,028 | $ 29,842 | $ 29,732 | $ 27,270 | $ 27,268 | $ 27,220 | $ 120,171 | $ 111,490 | |
Class B Common Stock | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.035 | $ 0.140 | $ 0.140 | $ 0.07 |
Class B Common Stock | Dividend Declared | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Dividends, common stock | $ 1,916 | $ 1,916 | $ 1,916 | $ 1,916 | $ 1,916 | $ 1,916 | $ 1,916 | $ 1,916 | $ 7,664 | $ 7,664 |
Share-Based Compensation - Disc
Share-Based Compensation - Disclosure of Share-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | |||
Share-based compensation expense | $ 66,566 | $ 61,237 | $ 96,013 |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | ||||||
Jun. 30, 2022 | Dec. 31, 2019 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation expense | $ 66,566 | $ 61,237 | $ 96,013 | |||||
2019 Special Dividend | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Common stock, dividends, per share, declared (in dollars per share) | $ 0.70 | |||||||
Share-based Payment Arrangement, Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation arrangement by share-based payment award, award vesting period | 3 years | |||||||
Performance Shares | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation arrangement by share-based payment award, shares issued in period (in shares) | 1,600,000 | |||||||
Weighted-average grant date fair value (in dollars per share) | $ 7.46 | |||||||
Share-Based Compensation, 2016 Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Common stock, number of shares authorized (in shares) | 5,000,000 | |||||||
Class B Units | Restricted Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Conversion of stock, issued (in shares) | 20,600,000 | |||||||
Common stock, service award vesting conditions, percentage | 50% | |||||||
Class B units stock, percent with performance award vesting conditions | 50% | |||||||
Share-based Compensation, 2018 Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Common stock, number of shares authorized (in shares) | 88,000,000 | 88,000,000 | 38,000,000 | |||||
Common stock, award requisite service period | 12 months | |||||||
Share-based Compensation, 2018 Plan | Share-based Payment Arrangement, Top-up Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Common stock, award requisite service period | 3 years | |||||||
Granted (in shares) | 12,700,000 | |||||||
Class B units stock, terms of award | ten years | |||||||
Share-based Compensation, 2018 Plan | Share-based Payment Arrangement, Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation expense | $ 7,000 | 12,000 | $ 16,000 | |||||
Granted (in shares) | 0 | |||||||
Stock options, grants in period, weighted average grant date fair value (in dollars per share) | $ 1.77 | |||||||
Share-based Compensation, 2018 Plan | Restricted Stock Units (RSUs) | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation expense | $ 55,000 | 46,000 | $ 39,000 | |||||
Share-based compensation arrangement by share-based payment award, equity instruments other than options, vested in period, fair value | 59,000 | $ 52,000 | ||||||
RSUs grants, nonvested award, cost not yet recognized, amount | $ 38,000 | |||||||
Stock options, nonvested award, cost not yet recognized, period for recognition | 1 year 8 months 12 days | |||||||
Weighted-average grant date fair value (in dollars per share) | $ 7.38 | $ 6.90 |
Share-Based Compensation - Summ
Share-Based Compensation - Summary of Distributed Shares Activity (Details) - Restricted Stock, Performance Tranche - Class B Units - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of distributed shares (in shares) | 9,323,486 | 9,503,668 |
Vested (in shares) | 0 | |
Forfeited (in shares) | (180,182) | |
Weighted-average grant date fair value (in dollars per share) | $ 13.05 | $ 13.08 |
Vested (in dollars per share) | 0 | |
Forfeited (in dollars per share) | $ 14.48 |
Share-Based Compensation - Su_2
Share-Based Compensation - Summary of Related to the 2018 Plan Options Activity (Details) - Share-based Compensation, 2018 Plan | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Top-up Options, Service Tranche | |
Number of Options | |
Balance at beginning of period (in shares) | shares | 5,974,369 |
Exercised (in shares) | shares | 0 |
Forfeited (in shares) | shares | (19,115) |
Balance at end of period (in shares) | shares | 5,955,254 |
Weighted-Average Grant Date Fair Value | |
Balance at beginning of period (in dollars per share) | $ / shares | $ 13.30 |
Exercised (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 13.30 |
Balance at end of period (in dollars per share) | $ / shares | $ 13.30 |
Number of options, exercisable (in shares) | shares | 5,955,254 |
Weighted-average exercise price, exercisable (in dollars per share) | $ / shares | $ 13.30 |
Top-up Options, Performance Tranche | |
Number of Options | |
Balance at beginning of period (in shares) | shares | 5,850,549 |
Exercised (in shares) | shares | 0 |
Forfeited (in shares) | shares | (135,488) |
Balance at end of period (in shares) | shares | 5,715,061 |
Weighted-Average Grant Date Fair Value | |
Balance at beginning of period (in dollars per share) | $ / shares | $ 13.30 |
Exercised (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 13.30 |
Balance at end of period (in dollars per share) | $ / shares | $ 13.30 |
Number of options, exercisable (in shares) | shares | 0 |
Weighted-average exercise price, exercisable (in dollars per share) | $ / shares | $ 13.30 |
Top-up Options | |
Weighted-Average Grant Date Fair Value | |
Aggregate intrinsic value, outstanding | $ | $ 0 |
Aggregate intrinsic value, exercisable | $ | $ 0 |
Weighted-average remaining contractual term, outstanding | 5 years |
Weighted-average remaining contractual term, exercisable | 5 years |
Share-based Payment Arrangement, Option | |
Number of Options | |
Balance at beginning of period (in shares) | shares | 21,465,818 |
Granted (in shares) | shares | 0 |
Exercised (in shares) | shares | (2,984,552) |
Forfeited (in shares) | shares | (515,640) |
Balance at end of period (in shares) | shares | 17,965,626 |
Weighted-Average Grant Date Fair Value | |
Balance at beginning of period (in dollars per share) | $ / shares | $ 6.64 |
Granted (in dollars per share) | $ / shares | 0 |
Exercised (in dollars per share) | $ / shares | 5.39 |
Forfeited (in dollars per share) | $ / shares | 11.23 |
Balance at end of period (in dollars per share) | $ / shares | $ 6.67 |
Number of options, exercisable (in shares) | shares | 14,515,244 |
Weighted-average exercise price, exercisable (in dollars per share) | $ / shares | $ 6.73 |
Aggregate intrinsic value, outstanding | $ | $ 52,245,000 |
Aggregate intrinsic value, exercisable | $ | $ 43,134,000 |
Weighted-average remaining contractual term, outstanding | 6 years 3 months 18 days |
Weighted-average remaining contractual term, exercisable | 6 years 2 months 12 days |
Share-Based Compensation - Sche
Share-Based Compensation - Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions (Details) - Share-based Compensation, 2018 Plan | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Risk-free interest rate, minimum | 0.51% |
Risk-free interest rate, maximum | 1.40% |
Expected exercise term (years) | 6 years |
Expected volatility, minimum | 45% |
Expected volatility, maximum | 46% |
Minimum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected dividend yield | 2.20% |
Maximum | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected dividend yield | 2.70% |
Share-Based Compensation - Su_3
Share-Based Compensation - Summary of Related 2018 Plan RSUs Activity (Details) - Restricted Stock Units (RSUs) - Share-based Compensation, 2018 Plan | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Number of RSUs | |
Beginning of period (in shares) | shares | 15,544,846 |
Granted (in shares) | shares | 6,599,292 |
Vested (in shares) | shares | (7,769,568) |
Forfeited (in shares) | shares | (1,219,161) |
End of period (in shares) | shares | 13,155,409 |
Weighted-Average Grant Date Fair Value | |
Beginning of period (in dollars per share) | $ / shares | $ 6.90 |
Granted (in dollars per share) | $ / shares | 7.85 |
Vested (in dollars per share) | $ / shares | 6.76 |
Forfeited (in dollars per share) | $ / shares | 7.83 |
End of period (in dollars per share) | $ / shares | $ 7.38 |
Net Income (Loss) Per Share - S
Net Income (Loss) Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Common Stock | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Allocation of net income (loss) - basic | $ 124,655 | $ (318,062) | $ (620,856) |
Dilutive effect (including conversion of Class B Common Stock) | 7,690 | 0 | 0 |
Allocation of net income (loss) - diluted | $ 132,345 | $ (318,062) | $ (620,856) |
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 848,465 | 770,620 | 760,483 |
Dilutive effect (including conversion of Class B Common Stock) (in shares) | 66,603 | 0 | 0 |
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 915,068 | 770,620 | 760,483 |
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Class B Common Stock | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Allocation of net income (loss) - basic | $ 8,008 | $ (22,758) | $ (11,337) |
Dilutive effect (including conversion of Class B Common Stock) | (24) | 0 | (1,952) |
Allocation of net income (loss) - diluted | $ 7,984 | $ (22,758) | $ (13,289) |
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 54,745 | 54,745 | 15,855 |
Dilutive effect (including conversion of Class B Common Stock) (in shares) | 0 | 0 | 2,089 |
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 54,745 | 54,745 | 17,944 |
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.72) |
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.74) |
Net Income (Loss) Per Share - N
Net Income (Loss) Per Share - Narrative (Details) - shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Incremental common shares attributable to dilutive effect of share-based payment arrangements (in shares) | 9 | 10 | 10 |
Share-based Payment Arrangement | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 61 | 66 |
Commitment and Contingencies -
Commitment and Contingencies - Schedule of Contractual Obligations Commitments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2023 | $ 175,861 |
2024 | 67,286 |
2025 | 43,386 |
2026 | 24,826 |
2027 | 412 |
Thereafter | 0 |
Total | $ 311,771 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Aug. 31, 2022 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | |
Loss Contingencies [Line Items] | ||||
Guarantor obligations, maximum exposure, undiscounted | $ 93 | $ 76 | ||
Unsecured line of credit facility, maximum borrowing capacity | $ 75 | |||
Insured Claims | ||||
Loss Contingencies [Line Items] | ||||
Loss contingency accrual | 90 | $ 90 | ||
Collaborative Arrangement, Transaction with Party to Collaborative Arrangement | Google | ||||
Loss Contingencies [Line Items] | ||||
Collaborative arrangement, future milestone contributions | $ 150 | |||
Collaborative arrangement, additional future milestone contributions | $ 150 |
Leases - Schedule of Consolidat
Leases - Schedule of Consolidated Balance Sheet Information Related to Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Operating lease, right-of-use asset, current | $ 210 | $ 230 |
Operating lease, right-of-use asset, non-current | 128,455 | 125,945 |
Finance lease, right-of-use asset, non-current | 93,013 | 88,962 |
Total right-of-use assets | 221,678 | 215,137 |
Operating lease, liability, current | 28,696 | 37,359 |
Finance lease, liability, current | 48,512 | 38,730 |
Operating lease, liability, noncurrent | 116,823 | 99,734 |
Finance Lease, Liability, noncurrent | 46,376 | 54,350 |
Total lease liabilities | $ 240,407 | $ 230,173 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Prepaid expenses and other current assets | Prepaid expenses and other current assets |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property and equipment, net | Property and equipment, net |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities | Accrued expenses and other current liabilities |
Finance Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Current maturities of long-term debt | Current maturities of long-term debt |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other liabilities | Other liabilities |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Long-term debt | Long-term debt |
Finance Lease, right-of-use asset, accumulated amortization | $ 106,000 | $ 78,000 |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating lease cost | $ 47,047 | $ 48,078 | $ 56,680 |
Amortization of right-of-use assets | 43,627 | 29,269 | 24,509 |
Interest on lease liabilities | 3,680 | 2,823 | 3,122 |
Variable lease costs | 90,671 | 72,367 | 47,013 |
Total lease cost | $ 185,025 | $ 152,537 | $ 131,324 |
Leases - Supplementary Cash Flo
Leases - Supplementary Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating cash flows | $ 47,708 | $ 50,721 | $ 56,235 |
Operating cash flows | 3,680 | 2,823 | 3,122 |
Financing cash flows | 44,978 | 32,123 | 27,956 |
Operating leases | 49,193 | 21,203 | 47,870 |
Finance leases | $ 48,439 | $ 46,920 | $ 15,326 |
Leases - Schedule of Operating
Leases - Schedule of Operating and Finance Lease Weighted Average Lease Term and Discount Rate (Details) | Dec. 31, 2022 | Dec. 31, 2021 |
Weighted-average remaining lease term (years): | ||
Operating leases | 5 years 4 months 24 days | 4 years 2 months 12 days |
Finance leases | 2 years 9 months 18 days | 2 years 9 months 18 days |
Weighted-average discount rate: | ||
Operating leases | 5.50% | 4.80% |
Finance leases | 4.50% | 3.70% |
Leases - Schedule of Operatin_2
Leases - Schedule of Operating and Finance Lease, Liability, Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Leases | ||
2023 | $ 33,049 | |
2024 | 36,235 | |
2025 | 29,518 | |
2026 | 23,519 | |
2027 | 15,956 | |
Thereafter | 36,115 | |
Total lease payments (including interest) | 174,392 | |
Less interest | 28,873 | |
Total | 145,519 | |
Finance Lease, Liability, Payment, Due [Abstract] | ||
2023 | 44,629 | |
2024 | 31,050 | |
2025 | 19,370 | |
2026 | 5,332 | |
2027 | 714 | |
Thereafter | 0 | |
Total lease payments (including interest) | 101,095 | |
Less interest | 6,207 | |
Total | $ 94,888 | $ 93,080 |
Retirement Plans (Details)
Retirement Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |||
Defined contribution plan, cost | $ 47 | $ 45 | $ 40 |
Defined benefit plan, plan assets, amount | 49 | 71 | |
Defined benefit plan, benefit obligation | (56) | (75) | |
Defined benefit plan, unfunded status of plan | (7) | (4) | |
Deferred compensation liability, classified, noncurrent | $ 27 | $ 32 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Oct. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Affiliated Entity | Loan Agreement | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from related party debt | $ 436 | |||
Temporary clawback, amount | 56 | |||
Related party transaction, amounts of transaction | 54 | |||
Affiliated Entity | Digital Customer Experience Partner | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction, amounts of transaction | 3 | |||
Affiliated Entity | Technical Service Encompassing the Purchase and Support of IT Equipment Service | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction, amounts of transaction | 2.7 | |||
Affiliated Entity | Technology and Communication Services Agreement | ||||
Related Party Transaction [Line Items] | ||||
Related party transaction, amounts of transaction | 2.2 | |||
Rackspace US Inc | Master Services Agreement | ||||
Related Party Transaction [Line Items] | ||||
Long-term purchase commitment, minimum amount | $ 50 | |||
Purchase commitment, term | 7 years | |||
Long-term purchase commitment, amount | 24 | |||
Payments to long-term purchase commitment | $ 14 | $ 6 | $ 0.5 |
Condensed Financial Informati_3
Condensed Financial Information of Registrant - CONDENSED BALANCE SHEETS (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||||
Cash and cash equivalents | $ 257,223 | $ 24,453 | $ 204,998 | |
Total current assets | 1,721,996 | 992,531 | ||
Total assets | 17,821,236 | 16,894,351 | ||
Current liabilities: | ||||
Total current liabilities | 2,661,103 | 1,703,345 | ||
Long-term debt | 8,956,671 | 9,575,098 | ||
Other liabilities | 271,842 | 300,693 | ||
Total liabilities | 14,428,088 | 13,645,632 | ||
Total stockholders' equity | 3,393,148 | 3,248,719 | 3,039,336 | $ 3,184,369 |
Total liabilities and stockholders' equity | 17,821,236 | 16,894,351 | ||
Parent Company | ||||
Current assets: | ||||
Cash and cash equivalents | 14,639 | 1,947 | $ 139,092 | $ 354 |
Total current assets | 14,639 | 1,947 | ||
Investment in subsidiaries and other assets | 4,036,420 | 3,850,198 | ||
Total assets | 4,051,059 | 3,852,145 | ||
Current liabilities: | ||||
Dividends payable and other current liabilities | 34,424 | 47,482 | ||
Total current liabilities | 34,424 | 47,482 | ||
Long-term debt | 536,495 | 527,098 | ||
Other liabilities | 86,992 | 28,846 | ||
Total liabilities | 657,911 | 603,426 | ||
Total stockholders' equity | 3,393,148 | 3,248,719 | ||
Total liabilities and stockholders' equity | $ 4,051,059 | $ 3,852,145 |
Condensed Financial Informati_4
Condensed Financial Information of Registrant - CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Condensed Statement of Income Captions [Line Items] | |||
Selling, general, and administrative expenses | $ 1,930,021 | $ 1,789,009 | $ 1,723,644 |
Merger, restructuring, integration, and other | 22,232 | 37,872 | 120,208 |
Operating income (loss) | (508,660) | (15,278) | (40,640) |
Other income (expense) | (57,561) | 8,313 | 8,293 |
Net income (loss) | 132,663 | (340,820) | (632,193) |
Other comprehensive income (loss), net of tax | 21,773 | 49,642 | (60,239) |
Comprehensive income (loss) | $ 154,436 | $ (291,178) | $ (692,432) |
Common Stock | |||
Net income (loss) per share - basic: | |||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Net income (loss) per share - basic class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Weighted-average shares outstanding - basic: | |||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 848,465 | 770,620 | 760,483 |
Weighted-average shares outstanding - basic class B common stock (in shares) | 848,465 | 770,620 | 760,483 |
Net income (loss) per share - diluted: | |||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Net income (loss) per share - diluted class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Weighted-average shares outstanding - diluted: | |||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 915,068 | 770,620 | 760,483 |
Weighted-average shares outstanding - diluted class B common stock (in shares) | 915,068 | 770,620 | 760,483 |
Class B Common Stock | |||
Net income (loss) per share - basic: | |||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.72) |
Net income (loss) per share - basic class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.72) |
Weighted-average shares outstanding - basic: | |||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 54,745 | 54,745 | 15,855 |
Weighted-average shares outstanding - basic class B common stock (in shares) | 54,745 | 54,745 | 15,855 |
Net income (loss) per share - diluted: | |||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.74) |
Net income (loss) per share - diluted class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.74) |
Weighted-average shares outstanding - diluted: | |||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 54,745 | 54,745 | 17,944 |
Weighted-average shares outstanding - diluted class B common stock (in shares) | 54,745 | 54,745 | 17,944 |
Parent Company | |||
Condensed Statement of Income Captions [Line Items] | |||
Selling, general, and administrative expenses | $ 2,583 | $ 117 | $ 807 |
Merger, restructuring, integration, and other | (6,011) | (1,444) | 4,532 |
Operating income (loss) | (3,428) | (1,327) | 5,339 |
Interest expense, net | (8,086) | (8,743) | (8,342) |
Other income (expense) | (63,394) | 0 | 0 |
Equity in net income (loss) of subsidiaries | 200,715 | (333,404) | (618,512) |
Net income (loss) | 132,663 | (340,820) | (632,193) |
Other comprehensive income (loss), net of tax | 21,773 | 49,642 | (60,239) |
Comprehensive income (loss) | $ 154,436 | $ (291,178) | $ (692,432) |
Parent Company | Common Stock | |||
Net income (loss) per share - basic: | |||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Net income (loss) per share - basic class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Weighted-average shares outstanding - basic: | |||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 848,465 | 770,620 | 760,483 |
Weighted-average shares outstanding - basic class B common stock (in shares) | 848,465 | 770,620 | 760,483 |
Net income (loss) per share - diluted: | |||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Net income (loss) per share - diluted class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.82) |
Weighted-average shares outstanding - diluted: | |||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 915,068 | 770,620 | 760,483 |
Weighted-average shares outstanding - diluted class B common stock (in shares) | 915,068 | 770,620 | 760,483 |
Parent Company | Class B Common Stock | |||
Net income (loss) per share - basic: | |||
Net income (loss) per share - basic common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.72) |
Net income (loss) per share - basic class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.72) |
Weighted-average shares outstanding - basic: | |||
Weighted average number of shares - basic common stock and Class B common stock (in shares) | 54,745 | 54,745 | 15,855 |
Weighted-average shares outstanding - basic class B common stock (in shares) | 54,745 | 54,745 | 15,855 |
Net income (loss) per share - diluted: | |||
Net income (loss) per share - diluted common stock and Class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.74) |
Net income (loss) per share - diluted class B common stock (in dollars per share) | $ 0.15 | $ (0.41) | $ (0.74) |
Weighted-average shares outstanding - diluted: | |||
Weighted average number of shares - diluted common stock and Class B common stock (in shares) | 54,745 | 54,745 | 17,944 |
Weighted-average shares outstanding - diluted class B common stock (in shares) | 54,745 | 54,745 | 17,944 |
Condensed Financial Informati_5
Condensed Financial Information of Registrant - CONDENSED STATEMENTS OF CASH FLOWS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities: | |||
Net income (loss) | $ 132,663 | $ (340,820) | $ (632,193) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Change in fair value of other financial instruments | 63,396 | 0 | 0 |
Other, net | (27,289) | 85,541 | 33,476 |
Net cash provided by (used in) operating activities | 1,887,920 | 1,649,723 | 1,366,749 |
Cash flows from investing activities: | |||
Acquisition of businesses | (13,095) | (163,503) | (224,617) |
Other investing, net | 13,444 | (3,991) | (45,850) |
Net cash provided by (used in) investing activities | (1,532,784) | (1,695,745) | (1,137,477) |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock, net of expenses | 1,180,000 | 0 | 447,811 |
Dividends on common stock | (127,125) | (116,348) | (109,328) |
Repurchases of common stock | (1,200,000) | 0 | (4) |
Other financing, net | (5,432) | (23,718) | (31,392) |
Net cash provided by (used in) financing activities | (14,833) | (128,448) | (70,261) |
Cash and cash equivalents and restricted cash and restricted cash equivalents: | |||
Net increase (decrease) during the period | 340,303 | (174,470) | 159,011 |
Beginning balance | 24,453 | 204,998 | |
Ending balance | 257,223 | 24,453 | 204,998 |
Supplementary cash flow information: | |||
Issuance of shares for acquisition of business | 55,485 | 528,503 | 113,841 |
Parent Company | |||
Cash flows from operating activities: | |||
Net income (loss) | 132,663 | (340,820) | (632,193) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Equity in net (income) loss of subsidiaries | (200,715) | 333,404 | 618,512 |
Change in fair value of other financial instruments | 63,396 | 0 | 0 |
Other, net | 49,470 | 24,391 | 30,687 |
Net cash provided by (used in) operating activities | 44,814 | 16,975 | 17,006 |
Cash flows from investing activities: | |||
Contributions to subsidiaries | 0 | (40,000) | (275,000) |
Distributions from subsidiaries | 118,200 | 8,700 | 260,852 |
Acquisition of businesses | 0 | 0 | (201,453) |
Other investing, net | 0 | 0 | 750 |
Net cash provided by (used in) investing activities | 118,200 | (31,300) | (214,851) |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock, net of expenses | 1,180,000 | 0 | 447,811 |
Dividends on common stock | (127,125) | (116,348) | (109,328) |
Repurchases of common stock | (1,200,000) | 0 | (4) |
Other financing, net | (3,197) | (6,472) | (1,896) |
Net cash provided by (used in) financing activities | (150,322) | (122,820) | 336,583 |
Cash and cash equivalents and restricted cash and restricted cash equivalents: | |||
Net increase (decrease) during the period | 12,692 | (137,145) | 138,738 |
Beginning balance | 1,947 | 139,092 | 354 |
Ending balance | 14,639 | 1,947 | 139,092 |
Supplementary cash flow information: | |||
Issuance of shares for acquisition of business | $ 55,485 | $ 528,503 | $ 113,841 |
Condensed Financial Informati_6
Condensed Financial Information of Registrant - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Document Information [Line Items] | |||
Issuance of shares for acquisition of business | $ 55,485 | $ 528,503 | $ 113,841 |
Sunpro Solar | |||
Document Information [Line Items] | |||
Issuance of shares for acquisition of business | 569,000 | ||
Parent Company | |||
Document Information [Line Items] | |||
Noncash capital contributions | 82,000 | 630,000 | 434,000 |
Issuance of shares for acquisition of business | $ 55,485 | 528,503 | 113,841 |
Noncash capital distributions | $ 43,000 | ||
Parent Company | Sunpro Solar | Common Stock | |||
Document Information [Line Items] | |||
Issuance of shares for acquisition of business | $ 529,000 |