Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 02, 2018 | Jun. 30, 2017 | |
Entity Registrant Name | ANGI Homeservices Inc. | ||
Entity Central Index Key | 1,705,110 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 0 | ||
Common Stock | |||
Entity Common Stock, Shares Outstanding (in shares) | 63,066,193 | ||
Class B Convertible Common Stock | |||
Entity Common Stock, Shares Outstanding (in shares) | 415,186,297 |
CONSOLIDATED AND COMBINED BALAN
CONSOLIDATED AND COMBINED BALANCE SHEET - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
ASSETS | ||
Cash and cash equivalents | $ 221,521 | $ 36,377 |
Accounts receivable, net of allowance of $9,263 and $9,177, respectively | 28,085 | 18,696 |
Other current assets | 12,772 | 8,739 |
Total current assets | 262,378 | 63,812 |
Property and equipment, net of accumulated depreciation and amortization | 53,292 | 23,645 |
Goodwill | 770,226 | 170,990 |
Intangible assets, net of accumulated amortization | 328,571 | 10,792 |
Deferred income taxes | 50,723 | 15,211 |
Other non-current assets | 2,072 | 11,067 |
TOTAL ASSETS | 1,467,262 | 295,517 |
LIABILITIES: | ||
Current portion of long-term debt | 13,750 | 0 |
Current portion of long-term debt—related party | 816 | 2,838 |
Accounts payable | 18,933 | 11,544 |
Deferred revenue | 62,371 | 18,828 |
Accrued expenses and other current liabilities | 75,171 | 34,438 |
Total current liabilities | 171,041 | 67,648 |
Long-term debt, net | 258,312 | 0 |
Long-term debt—related party, net | 1,997 | 47,000 |
Deferred income taxes | 5,626 | 2,228 |
Other long-term liabilities | 5,892 | 2,247 |
Redeemable noncontrolling interests | 21,300 | 13,781 |
Commitments and contingencies | ||
SHAREHOLDERS' EQUITY: | ||
Additional paid-in capital | 1,112,400 | 0 |
Accumulated deficit | (121,764) | 0 |
Invested capital | 0 | 154,852 |
Accumulated other comprehensive income (loss) | 2,232 | (1,721) |
Total ANGI Homeservices Inc. shareholders' equity and invested capital, respectively | 993,346 | 153,131 |
Noncontrolling interests | 9,748 | 9,482 |
Total shareholders' equity | 1,003,094 | 162,613 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 1,467,262 | 295,517 |
Class A common stock, $0.001 par value; authorized 2,000,000 shares; 62,818 shares issued and outstanding | ||
SHAREHOLDERS' EQUITY: | ||
Common stock | 63 | 0 |
Class B convertible common stock, $0.001 par value; authorized 1,500,000 shares; 415,186 shares issued and outstanding | ||
SHAREHOLDERS' EQUITY: | ||
Common stock | 415 | 0 |
Class C common stock, $0.001 par value; authorized 1,500,000 shares; no shares issued and outstanding | ||
SHAREHOLDERS' EQUITY: | ||
Common stock | $ 0 | $ 0 |
CONSOLIDATED AND COMBINED BALA3
CONSOLIDATED AND COMBINED BALANCE SHEET (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts receivable allowance | $ 9,263 | $ 9,177 |
Class A Common Stock | ||
Common stock, par value (USD per share) | $ 0.001 | |
Common stock authorized (shares) | 2,000,000,000 | |
Common stock issued (shares) | 62,818,000 | 0 |
Common stock outstanding (shares) | 62,818,000 | 0 |
Class B Common Stock | ||
Common stock, par value (USD per share) | $ 0.001 | |
Common stock authorized (shares) | 1,500,000,000 | |
Common stock issued (shares) | 415,186,000 | 0 |
Common stock outstanding (shares) | 415,186,000 | 0 |
Class C Common Stock | ||
Common stock, par value (USD per share) | $ 0.001 | |
Common stock authorized (shares) | 1,500,000,000 | |
Common stock issued (shares) | 0 | 0 |
Common stock outstanding (shares) | 0 | 0 |
CONSOLIDATED AND COMBINED STATE
CONSOLIDATED AND COMBINED STATEMENT OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | $ 736,386 | $ 498,890 | $ 361,201 |
Operating costs and expenses: | |||
Cost of revenue (exclusive of depreciation shown separately below) | 34,073 | 25,858 | 22,936 |
Selling and marketing expense | 464,040 | 306,713 | 225,876 |
General and administrative expense | 300,433 | 110,093 | 86,687 |
Product development expense | 47,907 | 20,596 | 16,842 |
Depreciation | 14,543 | 8,419 | 6,593 |
Amortization of intangibles | 23,261 | 3,153 | 3,835 |
Total operating costs and expenses | 884,257 | 474,832 | 362,769 |
Operating (loss) income | (147,871) | 24,058 | (1,568) |
Interest expense—third party | (1,765) | 0 | 0 |
Interest expense—related party | (5,971) | (894) | (272) |
Other income (expense), net | 1,974 | (699) | (398) |
(Loss) earnings before income taxes | (153,633) | 22,465 | (2,238) |
Income tax benefit (provision) | 49,106 | (11,834) | (1,758) |
Net (loss) earnings | (104,527) | 10,631 | (3,996) |
Net loss attributable to noncontrolling interests | 1,409 | 2,497 | 2,671 |
Net (loss) earnings attributable to ANGI Homeservices Inc. shareholders | $ (103,118) | $ 13,128 | $ (1,325) |
Per share information attributable to ANGI Homeservices Inc. shareholders: | |||
Basic (loss) earnings per share (USD per share) | $ (0.24) | $ 0.03 | $ 0 |
Diluted (loss) earnings per share (USD per share) | $ (0.24) | $ 0.03 | $ 0 |
Stock-based compensation expense by function: | |||
Stock-based compensation expense | $ 149,230 | $ 8,916 | $ 7,853 |
Cost of revenue | |||
Stock-based compensation expense by function: | |||
Stock-based compensation expense | 19 | ||
Selling and marketing expense | |||
Stock-based compensation expense by function: | |||
Stock-based compensation expense | 25,763 | 863 | 545 |
General and administrative expense | |||
Stock-based compensation expense by function: | |||
Stock-based compensation expense | 107,662 | 6,804 | 6,137 |
Product development expense | |||
Stock-based compensation expense by function: | |||
Stock-based compensation expense | $ 15,786 | $ 1,249 | $ 1,171 |
CONSOLIDATED AND COMBINED STAT5
CONSOLIDATED AND COMBINED STATEMENT OF COMPREHENSIVE OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net (loss) earnings | $ (104,527) | $ 10,631 | $ (3,996) |
Other comprehensive income (loss): | |||
Change in foreign currency translation adjustment | 4,968 | (657) | (581) |
Total other comprehensive income (loss) | 4,968 | (657) | (581) |
Comprehensive (loss) income | (99,559) | 9,974 | (4,577) |
Components of comprehensive loss attributable to noncontrolling interests: | |||
Net loss attributable to noncontrolling interests | 1,409 | 2,497 | 2,671 |
Change in foreign currency translation adjustment attributable to noncontrolling interests | (1,015) | 0 | 0 |
Comprehensive loss attributable to noncontrolling interests | 394 | 2,497 | 2,671 |
Comprehensive (loss) income attributable to ANGI Homeservices Inc. shareholders | $ (99,165) | $ 12,471 | $ (1,906) |
CONSOLIDATED AND COMBINED STAT6
CONSOLIDATED AND COMBINED STATEMENT OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Total ANGI Homeservices Inc. Shareholders' Equity and Invested Capital | Redeemable Noncontrolling Interests | Common StockClass A Common Stock | Common StockClass B Common Stock | Common StockClass C Common Stock | Additional Paid-in Capital | Accumulated Deficit | Invested Capital | Accumulated Other Comprehensive (Loss) Income | Noncontrolling Interests |
Balance at beginning of period at Dec. 31, 2014 | $ 144,334 | $ 144,334 | $ 6,478 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 144,817 | $ (483) | $ 0 |
Balance at the beginning of the period (in shares) at Dec. 31, 2014 | 0 | 0 | 0 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||||
Net (loss) earnings | (1,325) | (1,325) | (2,671) | (1,325) | |||||||
Other comprehensive income (loss) | (581) | (581) | 0 | (581) | |||||||
Adjustment of redeemable noncontrolling interests to fair value | (12,170) | (12,170) | 12,170 | (12,170) | |||||||
Net increase (decrease) in IAC/InterActiveCorp’s investment in HomeAdvisor | (3,008) | (3,008) | (3,008) | ||||||||
Other | 0 | 0 | 1,657 | 0 | 0 | 0 | 0 | ||||
Balance at end of period at Dec. 31, 2015 | 127,250 | 127,250 | 17,634 | $ 0 | $ 0 | $ 0 | 0 | 0 | 128,314 | (1,064) | 0 |
Balance at the end of the period (in shares) at Dec. 31, 2015 | 0 | 0 | 0 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||||
Net (loss) earnings | 13,008 | 13,128 | (2,377) | 13,128 | (120) | ||||||
Other comprehensive income (loss) | (657) | (657) | 0 | (657) | |||||||
Adjustment of redeemable noncontrolling interests to fair value | 3,110 | 3,110 | (3,110) | 3,110 | |||||||
Net increase (decrease) in IAC/InterActiveCorp’s investment in HomeAdvisor | 10,300 | 10,300 | 10,300 | ||||||||
Other | 0 | 0 | 1,634 | 0 | 0 | 0 | 0 | ||||
Noncontrolling interests created in an acquisition | 9,811 | 9,811 | |||||||||
Purchase of noncontrolling interests | (209) | (209) | |||||||||
Balance at end of period at Dec. 31, 2016 | 162,613 | 153,131 | 13,781 | $ 0 | $ 0 | $ 0 | 0 | 0 | 154,852 | (1,721) | 9,482 |
Balance at the end of the period (in shares) at Dec. 31, 2016 | 0 | 0 | 0 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||||
Net (loss) earnings | (103,136) | (103,118) | (1,391) | 0 | (121,764) | 18,646 | 0 | (18) | |||
Other comprehensive income (loss) | 4,210 | 3,953 | 758 | 0 | 0 | 3,953 | 257 | ||||
Adjustment of redeemable noncontrolling interests to fair value | (3,332) | (3,332) | 3,332 | (1,607) | 0 | (1,725) | 0 | 0 | |||
Net increase (decrease) in IAC/InterActiveCorp’s investment in HomeAdvisor | 46,339 | 46,339 | 46,339 | ||||||||
Other | 816 | (59) | 36 | (59) | 0 | 0 | 875 | ||||
Noncontrolling interests created in an acquisition | 0 | 14,758 | |||||||||
Purchase of noncontrolling interests | (848) | (848) | |||||||||
Contribution of IAC/InterActiveCorp's HomeAdvisor business to ANGI Homeservices Inc. and Combination with Angie's List | 779,471 | 779,471 | $ 61 | $ 415 | 997,107 | (218,112) | |||||
Contribution of IAC/InterActiveCorp's HomeAdvisor business to ANGI Homeservices Inc. and Combination with Angie's List (in shares) | 61,291,000 | 414,754,000 | |||||||||
Stock-based compensation expense | 125,451 | 125,451 | 2,017 | 125,451 | |||||||
Issuance of common stock pursuant to stock-based awards, net of withholding taxes | (8,490) | (8,490) | $ 2 | (8,492) | |||||||
Issuance of common stock pursuant to stock-based awards, net of withholding taxes (in shares) | 1,527,000 | ||||||||||
Issuance of common stock to IAC pursuant to the employee matters agreement (in shares) | 432,000 | ||||||||||
Issuance of common stock to IAC pursuant to the employee matters agreement | 0 | ||||||||||
Purchase of redeemable noncontrolling interests | 0 | 11,991 | |||||||||
Balance at end of period at Dec. 31, 2017 | $ 1,003,094 | $ 993,346 | $ 21,300 | $ 63 | $ 415 | $ 0 | $ 1,112,400 | $ (121,764) | $ 0 | $ 2,232 | $ 9,748 |
Balance at the end of the period (in shares) at Dec. 31, 2017 | 62,818,000 | 415,186,000 | 0 |
CONSOLIDATED AND COMBINED STAT7
CONSOLIDATED AND COMBINED STATEMENT OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Class A Common Stock | |||
Common stock, par value (USD per share) | $ 0.001 | ||
Class B Common Stock | |||
Common stock, par value (USD per share) | 0.001 | ||
Class C Common Stock | |||
Common stock, par value (USD per share) | 0.001 | ||
Common Stock | Class A Common Stock | |||
Common stock, par value (USD per share) | 0.001 | $ 0 | $ 0 |
Common Stock | Class B Common Stock | |||
Common stock, par value (USD per share) | 0.001 | 0 | 0 |
Common Stock | Class C Common Stock | |||
Common stock, par value (USD per share) | $ 0.001 | $ 0 | $ 0 |
CONSOLIDATED AND COMBINED STAT8
CONSOLIDATED AND COMBINED STATEMENT OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net (loss) earnings | $ (104,527) | $ 10,631 | $ (3,996) |
Adjustments to reconcile net (loss) earnings to net cash provided by operating activities: | |||
Stock-based compensation expense | 149,230 | 8,916 | 7,853 |
Amortization of intangibles | 23,261 | 3,153 | 3,835 |
Bad debt expense | 27,514 | 17,425 | 13,234 |
Depreciation | 14,543 | 8,419 | 6,593 |
Deferred income taxes | (48,350) | (3,719) | (3,469) |
Other adjustments, net | (911) | 1,142 | 874 |
Changes in assets and liabilities, net of effects of acquisitions: | |||
Accounts receivable | (33,179) | (23,862) | (16,202) |
Other current assets | 4,523 | (2,972) | (1,823) |
Accounts payable and other current liabilities | 778 | 14,936 | 1,339 |
Income taxes payable and receivable | (2,054) | 6,932 | 2,459 |
Deferred revenue | 10,995 | 6,895 | 7,188 |
Net cash provided by operating activities | 41,823 | 47,896 | 17,885 |
Cash flows from investing activities: | |||
Acquisitions, net of cash acquired | (66,340) | (15,649) | 0 |
Capital expenditures | (26,837) | (16,660) | (10,170) |
Net cash used in investing activities | (93,177) | (32,309) | (10,170) |
Cash flows from financing activities: | |||
Borrowing under term loan | 275,000 | 0 | 0 |
Debt issuance costs | (3,013) | 0 | 0 |
Proceeds from issuance of related party debt | 131,360 | 44,838 | 0 |
Principal payments on related party debt | (181,580) | (11,350) | 0 |
Proceeds from the exercise of stock options | 1,653 | 0 | 0 |
Withholding taxes paid on behalf of employees on net settled stock-based awards | (10,113) | 0 | 0 |
Funds returned from (held in) escrow for MyHammer tender offer | 10,604 | (10,548) | 0 |
Transfers from (to) IAC/InterActiveCorp for periods prior to the Combination | 24,178 | (4,305) | (9,525) |
Purchase of noncontrolling interests | (12,789) | (209) | 0 |
Other, net | 37 | 9 | |
Net cash provided by (used in) financing activities | 235,337 | 18,426 | (9,516) |
Total cash provided (used) | 183,983 | 34,013 | (1,801) |
Effect of exchange rate changes on cash and cash equivalents | 1,161 | (98) | (322) |
Net increase (decrease) in cash and cash equivalents | 185,144 | 33,915 | (2,123) |
Cash and cash equivalents at beginning of period | 36,377 | 2,462 | 4,585 |
Cash and cash equivalents at end of period | $ 221,521 | $ 36,377 | $ 2,462 |
ORGANIZATION
ORGANIZATION | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATION ANGI Homeservices is the world's largest digital marketplace for home services, connecting millions of homeowners across the globe with home service professionals. ANGI Homeservices operates leading brands in eight countries, including HomeAdvisor® and Angie's List® (United States), HomeStars (Canada), Travaux.com (France), MyHammer (Germany and Austria), MyBuilder (UK), Werkspot (Netherlands) and Instapro (Italy). ANGI Homeservices owns and operates the HomeAdvisor digital marketplace in the United States (the “Marketplace”), which connects consumers with service professionals nationwide for home repair, maintenance and improvement projects. The Marketplace provides consumers with tools and resources to help them find local, pre-screened and customer-rated service professionals, as well as instantly book appointments with those professionals online or connect with them by telephone. Effective September 29, 2017, the Company also owns and operates Angie’s List, which connects consumers with service professionals for local services through a nationwide online directory of service professionals in over 700 service categories and provides consumers with valuable tools, services and content, including more than ten million verified reviews of local service professionals, to help them research, shop and hire for local services. In addition to its market-leading U.S. operations, ANGI Homeservices owns the leading home services online marketplaces in Canada (HomeStars, acquired on February 8, 2017), Germany and Austria (MyHammer, acquired on November 3, 2016), France (Travaux.com) and the Netherlands (Werkspot), as well as operations in Italy (Instapro) and the United Kingdom (MyBuilder, acquired on March 24, 2017). ANGI Homeservices also owns mHelpDesk, a provider of cloud-based field service software for small to mid-size businesses, and Felix, a pay-per-call advertising service. As of December 31, 2017 , the Company had a network of approximately 181,000 Marketplace Paying Service Professionals providing services in more than 500 categories and 400 discrete markets in the United States, ranging from simple home repairs to larger home remodeling projects. The Company generated approximately 18.1 million Marketplace Service Requests from consumers during the year ended December 31, 2017 . As of December 31, 2017 , the Company also had approximately 45,000 Angie's List Advertising Service Professionals. The Company has two operating segments: (i) North America, which primarily includes HomeAdvisor's operations in the United States, Angie's List, mHelpDesk and HomeStars, and (ii) Europe, which includes Travaux.com, MyHammer, MyBuilder, Werkspot and Instapro. On September 29, 2017 , IAC/InterActiveCorp ("IAC") and Angie's List Inc. ("Angie's List") combined IAC's HomeAdvisor business and Angie's List under a new publicly traded company called ANGI Homeservices Inc. The merger agreement provided for the combination with Angie’s List by way of the merger of a direct wholly-owned subsidiary of ANGI Homeservices with and into Angie’s List (the "Combination"), with Angie’s List continuing as the surviving company in the Combination. Prior to the effective time of the Combination, IAC contributed its HomeAdvisor business, along with certain cash, to ANGI Homeservices in exchange for shares of ANGI Homeservices Class B common stock. Following the Combination, Angie’s List and the legal entity that holds the HomeAdvisor business are direct wholly-owned subsidiaries of ANGI Homeservices Inc. At December 31, 2017 , IAC owned 86.9% and 98.5% of the economic and voting interest, respectively, of ANGI Homeservices. See " Note 4—Business Combinations " for additional information related to the Combination. All references to "ANGI Homeservices," the "Company," "we," "our" or "us" in this report are to ANGI Homeservices Inc. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation and consolidation The Company prepares its consolidated and combined financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company's financial statements were prepared on a consolidated basis beginning September 29, 2017 and on a combined basis for periods prior thereto. The difference in presentation is due to the fact that the final steps of the legal reorganization through which IAC contributed the HomeAdvisor business and cash to fund the cash consideration paid in the Combination to ANGI Homeservices Inc. were not completed, as planned, until immediately prior to September 29, 2017 . The preparation of the financial statements on a combined basis for periods prior thereto allows for the financial statements to be presented on a consistent basis for all periods presented. The combined financial statements have been prepared on a standalone basis and are derived from the historical consolidated financial statements and accounting records of IAC through September 29, 2017 . The combined financial statements reflect the historical financial position, results of operations and cash flows of the businesses comprising the HomeAdvisor business since their respective dates of acquisition by IAC. The consolidated financial statements include the accounts of the Company, all entities that are wholly-owned by the Company and all entities in which the Company has a controlling financial interest. The consolidated and combined financial statements reflect the allocation to ANGI Homeservices of certain IAC corporate expenses relating to the HomeAdvisor business based on the historical consolidated financial statements and accounting records of IAC through September 29, 2017 . For the purpose of these financial statements, income taxes have been computed as if ANGI Homeservices filed on a standalone, separate tax return basis. All intercompany transactions and balances between and among the Company and its subsidiaries have been eliminated. All intercompany transactions between (i) ANGI Homeservices and (ii) IAC and its subsidiaries, with the exception of notes payable due to IAC and its subsidiaries, are considered to be effectively settled for cash at the time the transaction is recorded. The notes payable due to IAC and its subsidiaries are included in “Long-term debt—related party” in the accompanying consolidated and combined balance sheet. See " Note 15—Related Party Transactions " for additional information on transactions between ANGI Homeservices and IAC. In the opinion of management, the assumptions underlying the historical consolidated and combined financial statements, including the basis on which the expenses have been allocated from IAC, are reasonable. However, the allocations may not reflect the expenses that we may have incurred as a standalone public company for the periods presented. Accounting estimates Management of the Company is required to make certain estimates, judgments and assumptions during the preparation of its consolidated and combined financial statements in accordance with GAAP. These estimates, judgments and assumptions impact the reported amounts of assets, liabilities, revenue and expenses and the related disclosure of contingent assets and liabilities. Actual results could differ from these estimates. On an ongoing basis, the Company evaluates its estimates and judgments including those related to: the recoverability of goodwill and indefinite-lived intangible assets; the useful lives and recoverability of definite-lived intangible assets and property and equipment; the carrying value of accounts receivable, including the determination of the allowance for doubtful accounts; the determination of revenue reserves; the liabilities for uncertain tax positions; the valuation allowance for deferred income tax assets; and the fair value of and forfeiture rates for stock-based awards, among others. The Company bases its estimates and judgments on historical experience, its forecasts and budgets and other factors that the Company considers relevant. Revenue recognition The Company recognizes revenue when persuasive evidence of an arrangement exists, services are rendered to customers, the fee or price charged is fixed or determinable and collectability is reasonably assured. Deferred revenue is recorded when payments are received, or contractually due, in advance of services or advertising to be provided. Deferred revenue is recognized as revenue when the related services or advertising are actually provided. Marketplace Revenue is primarily derived from (i) consumer connection revenue, which includes fees paid by service professionals for consumer matches (regardless of whether the professional ultimately provides the requested service), and (ii) membership subscription fees paid by service professionals. Consumer connection revenue varies based upon several factors, including the service requested, type of match (such as Instant Booking, Instant Connect, Same Day Service or Next Day Service) and geographic location of service. The Company’s consumer connection revenue is generated and recognized when an in-network service professional is delivered a consumer match. Membership subscription revenue is generated through subscription sales to service professionals and is deferred and recognized over the term of the applicable membership. Membership agreements can be one month, three months, or one year. Effective with the Combination, revenue is also derived from Angie's List (i) sales of time-based advertising to service professionals and (ii) membership subscription fees from consumers. Angie's List service professionals generally pay for advertisements in advance on a monthly or annual basis at the option of the service professional, with the average advertising contract term being approximately one year. These contracts include an early termination penalty. Angie's List revenue from the sale of website, mobile and call center advertising is recognized ratably over the period during which the advertisements run. Revenue from the sale of advertising in the Angie’s List Magazine is recognized in the period in which the publication is published and distributed. Angie's List prepaid consumer membership subscription fees are recognized as revenue ratably over the term of the associated subscription, which is typically one year. Deferred revenue is $64.1 million and $18.8 million at December 31, 2017 and 2016 , respectively. The balance at December 31, 2017 includes Angie's List deferred revenue of $37.7 million . Cash and cash equivalents Cash and cash equivalents include cash and short-term investments, with maturities of less than 91 days from the date of purchase. Domestically, cash equivalents consist of AAA rated government money market funds, certificates of deposit and treasury discount notes. Internationally, there are no cash equivalents at December 31, 2017 . At December 31, 2016 , internationally, cash equivalents consist of AAA rated government money market funds. Accounts receivable, net of allowance for doubtful accounts and revenue reserves Accounts receivable are stated at amounts due from customers, net of an allowance for doubtful accounts and revenue reserves. Accounts receivable outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time accounts receivable are past due, the Company’s previous loss history and the specific customer’s ability to pay its obligation to the Company. The Company writes off accounts receivable when they become uncollectible. The Company also maintains allowances to reserve for potential credits issued to customers or other revenue adjustments. The amounts of these reserves are based, in part, on historical experience. Property and equipment Property and equipment, including significant improvements, are recorded at cost. Repairs and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, or, in the case of leasehold improvements, the lease term, if shorter. Asset Category Estimated Useful Lives Computer equipment and capitalized software 2 to 3 Years Furniture and other equipment 5 to 7 Years Buildings and leasehold improvements 5 to 25 Years The Company capitalizes certain internal use software costs including external direct costs utilized in developing or obtaining the software and compensation for personnel directly associated with the development of the software. Capitalization of such costs begins when the preliminary project stage is complete and ceases when the project is substantially complete and ready for its intended purpose. The net book value of capitalized internal use software is $23.3 million and $14.5 million at December 31, 2017 and 2016 , respectively. Business combinations The purchase price of each acquisition is attributed to the assets acquired and liabilities assumed based on their fair values at the date of acquisition, including identifiable intangible assets that either arise from a contractual or legal right or are separable from goodwill. The fair value of these intangible assets is based on detailed valuations that use information and assumptions provided by management. The excess purchase price over the net tangible and identifiable intangible assets is recorded as goodwill and is assigned to the reporting unit(s) that is expected to benefit from the combination as of the acquisition date. Goodwill and indefinite-lived intangible assets The Company assesses goodwill and indefinite-lived intangible assets for impairment annually as of October 1, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit or the fair value of an indefinite-lived intangible asset below its carrying value. At October 1, 2017, the Company has two reporting units: North America and Europe. When the Company elects to perform a qualitative assessment and concludes it is not more likely than not that the fair value of the reporting unit is less than its carrying value, no further assessment of that reporting unit’s goodwill is necessary; otherwise, a quantitative assessment is performed and the fair value of the reporting unit is determined. If the carrying value of the reporting unit exceeds its fair value an impairment loss equal to the excess is recorded. For the Company’s annual goodwill test at October 1, 2017, a qualitative assessment of the North America and Europe reporting units’ goodwill was performed because the Company concluded it was more likely than not that the fair value of these reporting units was in excess of their respective carrying values. In the aggregate, ANGI Homeservices' October 1, 2017 market capitalization of $5.9 billion exceeded its carrying value by more than 450% . The primary factor that the Company considered in its qualitative assessment for its Europe reporting unit was a valuation performed during September 2017, which was prepared primarily in connection with IAC's contribution of HomeAdvisor International into ANGI Homeservices immediately prior to the Combination. The valuation was prepared time proximate to, but not as of, October 1, 2017. The fair value from the September 2017 valuation exceeds the carrying value of the Europe reporting unit by 60% . The primary factors that the Company considered in its qualitative assessment for its North America reporting unit were the strong operating performance of the North America reporting unit and the significant excess of the estimated fair value of the North America reporting unit over its carrying value. The fair value of the North America reporting unit was estimated by subtracting the fair value of the Europe reporting unit, from the September 2017 valuation described above, from the October 1, 2017 market capitalization of the Company; the estimated fair value of the North America reporting unit exceeded its carrying value by approximately 500% . While the Company has the option to qualitatively assess whether it is more likely than not that the fair values of its indefinite-lived intangible assets are less than their carrying values, the Company’s policy is to determine the fair value of each of its indefinite-lived intangible assets annually as of October 1. In 2017, the Company did not quantitatively assess the Angie's List indefinite-lived intangible assets acquired through the Combination given the proximity of the September 29, 2017 transaction date to the October 1, 2017 annual test date. The Company determines the fair value of indefinite-lived intangible assets using an avoided royalty discounted cash flow (“DCF”) valuation analysis. Significant judgments inherent in this analysis include the selection of appropriate royalty and discount rates and estimating the amount and timing of expected future cash flows. The discount rates used in the DCF analyses are intended to reflect the risks inherent in the expected future cash flows generated by the respective intangible assets. The royalty rates used in the DCF analyses are based upon an estimate of the royalty rates that a market participant would pay to license the Company’s trade names and trademarks. Assumptions used in the avoided royalty DCF analyses, including the discount rate and royalty rate, are assessed annually based on the actual and projected cash flows related to the asset, as well as macroeconomic and industry specific factors. The discount rate used in the Company’s annual indefinite-lived impairment assessment ranged from 11.5% to 18.5% in 2017 and was 17% in 2016 , and the royalty rate used ranged from 1% to 6% in 2017 and was 1% in 2016 . The 2017, 2016, and 2015 annual assessments of goodwill and indefinite-lived intangible assets identified no impairments. Long-lived assets and intangible assets with definite lives Long-lived assets, which consist of property and equipment and intangible assets with definite lives, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The carrying value of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value is deemed not to be recoverable, an impairment loss is recorded equal to the amount by which the carrying value of the long-lived asset exceeds its fair value. Amortization of definite-lived intangible assets is computed either on a straight-line basis or based on the pattern in which the economic benefits of the asset will be realized. Fair value measurements The Company categorizes its financial instruments measured at fair value into a fair value hierarchy that prioritizes the inputs used in pricing the asset or liability. The three levels of the fair value hierarchy are: • Level 1: Observable inputs obtained from independent sources, such as quoted prices for identical assets and liabilities in active markets. • Level 2: Other inputs, which are observable directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data. The fair values of the Company's Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may not be actively traded. Certain of these securities may have different market prices from multiple market data sources, in which case an average market price is used. • Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities. The Company’s non-financial assets, such as goodwill, intangible assets and property and equipment are adjusted to fair value only when an impairment charge is recognized. Such fair value measurements are based predominantly on Level 3 inputs. Advertising costs Advertising costs are expensed in the period incurred (when the advertisement first runs for production costs that are initially capitalized) and represent online marketing, including fees paid to search engines, offline marketing, which is primarily television advertising and partner-related payments to those who direct traffic to our platforms. Advertising expense is $282.3 million , $196.8 million and $145.4 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Legal costs Legal costs are expensed as incurred. Income taxes ANGI Homeservices is included within IAC's tax group for purposes of federal and consolidated state income tax return filings. In all periods presented, current and deferred income taxes have been computed for ANGI Homeservices on an as if standalone, separate return basis. The Company’s payments to IAC for its share of IAC’s consolidated federal and state income tax return liabilities have been reflected within cash flows from operating activities in the accompanying consolidated and combined statement of cash flows. The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided on deferred tax assets if it is determined that it is more likely than not that the deferred tax asset will not be realized. The Company records interest, net of any applicable related income tax benefit, on potential income tax contingencies as a component of income tax expense. The Company evaluates and accounts for uncertain tax positions using a two-step approach. Recognition (step one) occurs when the Company concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustainable upon examination. Measurement (step two) determines the amount of benefit that is greater than 50% likely to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. De-recognition of a tax position that was previously recognized would occur when the Company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act imposes a new minimum tax on global intangible low-taxed income (“GILTI”) earned by foreign subsidiaries beginning in 2018. The Financial Accounting Standards Board ("FASB") Staff Q&A, Topic 740 No. 5, Accounting for Global Intangible Low-Taxed Income , states that an entity can make an accounting policy election to either recognize deferred taxes for temporary differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred. The Company intends to elect to recognize the tax on GILTI as a period expense in the period the tax is incurred. Earnings Per Share Basic earnings per share is computed by dividing net earnings attributable to ANGI Homeservices Inc. shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the potential dilution that could occur if stock options, stock appreciation rights and other commitments to issue common stock were exercised or equity awards vested resulting in the issuance of common stock that could share in the earnings of the Company. Foreign currency translation and transaction gains and losses The financial position and operating results of foreign entities whose primary economic environment is based on their local currency are combined using the local currency as the functional currency. These local currency assets and liabilities are translated at the rates of exchange as of the balance sheet date, and local currency revenue and expenses of these operations are translated at average rates of exchange during the period. Translation gains and losses are included in accumulated other comprehensive income as a component of shareholders’ equity. Transaction gains and losses resulting from assets and liabilities denominated in a currency other than the functional currency are included in the consolidated and combined statement of operations as a component of other income (expense), net. Stock-based compensation Stock-based compensation is measured at the grant date based on the fair value of the award and is expensed over the requisite service period. See “ Note 11—Stock‑based Compensation ” for a discussion of the Company's stock-based compensation plans. Redeemable noncontrolling interests Noncontrolling interests in the subsidiaries of the Company are ordinarily reported on the consolidated and combined balance sheet within shareholders’ equity, separately from the Company’s equity. However, securities that are redeemable at the option of the holder and not solely within the control of the issuer must be classified outside of shareholders’ equity. Accordingly, all noncontrolling interests that are redeemable at the option of the holder are presented outside of shareholders’ equity in the accompanying consolidated and combined balance sheet. In connection with the acquisition of certain subsidiaries, management of these businesses has retained an ownership interest. The Company is party to fair value put and call arrangements with respect to these interests. These put and call arrangements allow management of these businesses to require the Company to purchase their interests or allow the Company to acquire such interests at fair value, respectively. The put arrangements do not meet the definition of a derivative instrument as the put agreements do not provide for net settlement. These put and call arrangements become exercisable by the Company and the counterparty at various dates. During the year ended December 31, 2017 , one of these arrangement was exercised. No put and call arrangements were exercised during 2016 or 2015 . Because these put arrangements are exercisable by the counterparty outside the control of the Company, to the extent that the fair value of these interests exceeds the value determined by normal noncontrolling interest accounting, the value of such interests is adjusted to fair value with a corresponding adjustment to additional paid-in capital or invested capital for periods subsequent to and prior to the Combination, respectively. During the years ended December 31, 2017 , 2016 and 2015 , the Company recorded adjustments of $3.3 million , $(3.1) million , and $12.2 million , respectively, to increase (decrease) these interests to fair value. Fair value determinations require high levels of judgment and are based on various valuation techniques, including market comparables and discounted cash flow projections. Certain risks and concentrations The Company’s business is subject to certain risks and concentrations including dependence on third party technology providers, exposure to risks associated with online commerce security and credit card fraud. Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of cash and cash equivalents. Cash and cash equivalents are maintained with financial institutions and are in excess of Federal Deposit Insurance Company insurance limits. Recent accounting pronouncements Accounting pronouncements not yet adopted by the Company In May 2014, the FASB issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers, which clarifies the principles for recognizing revenue and develops a common standard for all industries. ASU No. 2014-09 was subsequently amended during 2015, 2016 and 2017; these amendments provide further revenue recognition guidance related to principal versus agent considerations, performance obligations and licensing, narrow-scope improvements and practical expedients. ASU No. 2014-09 is a comprehensive revenue recognition standard that will supersede nearly all existing revenue recognition guidance under GAAP. The new standard provides a single principles-based, five-step model to be applied to all contracts with customers. This five-step model includes (1) identifying the contract(s) with the customer, (2) identifying the performance obligations in the contract, (3) determining the transaction price, (4) allocating the transaction price to the performance obligations in the contract and (5) recognizing revenue when each performance obligation is satisfied. More specifically, revenue will be recognized when promised goods or services are transferred to the customer in an amount that reflects the consideration expected in exchange for those goods or services. ASU No. 2014-09 is effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted for interim and annual reporting periods beginning after December 15, 2016. Upon adoption, ASU No. 2014-09 may either be applied retrospectively to each prior period presented or using the modified retrospective approach with the cumulative effect recognized as of the date of initial application. The Company’s evaluation of the impact of the adoption of ASU No. 2014-09 on its consolidated and combined financial statements is substantially complete. The principal remaining work is a confirmation of the calculation of the cumulative effect of ASU No. 2014-09 as of January 1, 2018, which will be completed during the financial close process for the first quarter of 2018. The Company has adopted ASU No. 2014-09 using the modified retrospective approach effective January 1, 2018. Therefore, the cumulative effect of adoption will be reflected as an adjustment to beginning retained earnings in the Form 10-Q for the period ending March 31, 2018. The effect of the adoption of ASU No. 2014-09 on the Company is that sales commissions, which represent the incremental direct costs of obtaining a service professional contract, will be capitalized and amortized over the average life of a service professional. These costs were expensed as incurred prior to January 1, 2018. The current estimate of the cumulative effect of the adoption of ASU No. 2014-09 is the establishment of a current and non-current asset for capitalized sales commissions of approximately $30 million and $5 million , respectively, for the unamortized cost of the sales commissions paid to obtain a service professional and a related deferred tax liability of approximately $10 million , resulting in a net increase to retained earnings of $25 million on January 1, 2018. The estimated impact of ASU No. 2014-09 on the Company's consolidated and combined statement of operations, if January 1, 2017 were the date of adoption, would be a reduction in net loss of approximately $8 million . In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which supersedes pre-existing guidance on accounting for leases in "Leases (Topic 840)" and generally requires all leases to be recognized in the statement of financial position. The provisions of ASU No. 2016-02 are effective for reporting periods beginning after December 15, 2018; early adoption is permitted. The provisions of ASU No. 2016-02 are to be applied using a modified retrospective approach. The Company will adopt ASU No. 2016-02 effective January 1, 2019. The Company is not a lessor and has no capitalized leases and does not expect to enter into any capitalized leases prior to the adoption of ASU No. 2016-02. Accordingly, the Company does not expect the amount or classification of rent expense in its statement of operations to be affected by ASU No. 2016-02. The primary effect of the adoption of ASU No. 2016-02 will be the recognition of a right of use asset and related liability to reflect the Company's rights and obligations under its operating leases. The Company will also be required to provide the additional disclosures stipulated in ASU No. 2016-02. The adoption of ASU No. 2016-02 will not have an impact on the leverage calculation set forth in the Company's term loan facility because the leverage calculation is not affected by the liability that will be recorded upon adoption of the new standard. While the Company's evaluation of the impact of the adoption of ASU No. 2016-02 on its consolidated financial statements continues, outlined below is a summary of the status of the Company's progress: • the Company has selected a software package to assist in the determination of the right of use asset and related liability as of January 1, 2019 and to provide the required information following the adoption; • the Company has prepared summaries of its leases for input into the software package; • the Company is assessing the other inputs required in connection with the adoption of ASU No. 2016-02; and, • the Company is developing its accounting policy, procedures and controls related to the new standard. The Company does not expect to have a preliminary estimate of the right of use asset and related liability as of the adoption date until the third quarter of 2018. Accounting pronouncements adopted by the Company In May 2017, the FASB issued ASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting , which provides guidance about the changes to the terms and conditions of a share-based payment award that require an entity to apply modification accounting in "Stock Compensation (Topic 718)." The provisions of ASU No. 2017-09 are effective for reporting periods beginning after December 15, 2017; early adoption is permitted. The provisions of ASU No. 2017-09 are to be applied prospectively to an award modified on or after the adoption date. The Company early adopted the provisions of ASU No. 2017-09 during the third quarter of 2017 and the adoption of this standard update did not have a material impact on its consolidated and combined financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies how cash receipts and cash payments in certain transactions are presented and classified on the statement of cash flows. The provisions of ASU No. 2016-15 are effective for reporting periods beginning after December 15, 2017, including interim periods, and will require adoption on a retrospective basis unless it is impracticable to apply, in which case we would be required to apply the amendments prospectively as of the earliest date practicable; early adoption is permitted. The Company early adopted the provisions of ASU No. 2016-15 on January 1, 2017 and the adoption of this standard update did not have a material impact on its consolidated and combined financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . The Company adopted the provisions of ASU No. 2016-09 on January 1, 2017. Excess tax benefits or deficiencies related to equity awards to employees upon exercise of stock options, stock appreciation rights and the vesting of restricted stock units after January 1, 2017 are (i) reflected in the consolidated and combined statement of operations as a component of the provision for income taxes, rather than recognized in equity (adopted on a prospective basis), and (ii) reflected as operating, rather than financing, cash flows in our consolidated and combined statement of cash flows (adopted on a retrospective basis). Excess tax benefits for the year ended December 31, 2017 were $35.8 million . Excess tax benefits of $7.7 million and $0.1 million for the years ended December 31, 2016 and 2015 , respectively were reclassified in the combined statement of cash flows to conform to the current year presentation. The Company continues to account for forfeitures using an estimated forfeiture rate. In Januar |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES ANGI Homeservices is included within IAC’s tax group for purposes of federal and consolidated state income tax return filings. In all periods presented, current and deferred income tax benefit and provision have been computed for ANGI Homeservices on an as if stand-alone, separate return basis. ANGI Homeservices’ payments to IAC for its share of IAC’s consolidated federal and state tax return liabilities have been reflected within cash flows from operating activities in the accompanying consolidated and combined statement of cash flows. U.S. and foreign (loss) earnings before income taxes and noncontrolling interests are as follows: Years Ended December 31, 2017 2016 2015 (In thousands) U.S. $ (132,000 ) $ 27,284 $ 1,149 Foreign (21,633 ) (4,819 ) (3,387 ) Total $ (153,633 ) $ 22,465 $ (2,238 ) The components of the (benefit) provision for income taxes are as follows: Years Ended December 31, 2017 2016 2015 (In thousands) Current income tax provision (benefit): Federal $ (443 ) $ 13,440 $ 2,901 State 21 2,274 601 Foreign (334 ) (161 ) 1,725 Current income tax (benefit) provision (756 ) 15,553 5,227 Deferred income tax benefit Federal (38,587 ) (2,483 ) (2,823 ) State (8,467 ) (775 ) (557 ) Foreign (1,296 ) (461 ) (89 ) Deferred income tax benefit (48,350 ) (3,719 ) (3,469 ) Income tax (benefit) provision $ (49,106 ) $ 11,834 $ 1,758 The deferred tax asset for net operating losses ("NOLs") was increased by $35.8 million for the year ended December 31, 2017 for excess tax deductions attributable to stock-based compensation. The related income tax benefit was recorded as a component of the deferred income tax benefit. The current income tax payable was reduced by $7.7 million and $0.1 million for the years ended December 31, 2016 and 2015 , respectively, for excess tax deductions attributable to stock-based compensation. For the years ended December 31, 2016 and 2015 , the related income tax benefits were recorded as increases to invested capital. The tax effects of cumulative temporary differences that give rise to significant deferred tax assets and deferred tax liabilities are presented below. The valuation allowance relates to deferred tax assets for which it is more likely than not that the tax benefit will not be realized. December 31, 2017 2016 (In thousands) Deferred tax assets: Accrued expenses $ 5,468 $ 3,527 NOL carryforwards 135,042 12,869 Stock-based compensation 34,408 10,382 Allowance for bad debts 1,999 3,186 Deferred revenue 10,924 — Property and equipment 650 — Other 3,575 1,811 Total deferred tax assets 192,066 31,775 Less valuation allowance (61,563 ) (14,180 ) Net deferred tax assets 130,503 17,595 Deferred tax liabilities: Intangible and other assets (85,227 ) (1,818 ) Property and equipment — (2,661 ) Other (179 ) (133 ) Total deferred tax liabilities (85,406 ) (4,612 ) Net deferred tax assets $ 45,097 $ 12,983 At December 31, 2017 , the Company has federal and state NOLs of $317.5 million and $378.6 million , respectively. If not utilized, the federal NOLs will expire between 2024 and 2037 and the state NOLs will expire at various times primarily between 2027 and 2037. Federal and state NOLs of $116.0 million and $121.1 million , respectively, can be used against future taxable income without restriction and the remaining NOLs will be subject to limitations under Section 382 of the Internal Revenue Code, separate return limitations, and applicable state law. At December 31, 2017 , the Company has foreign NOLs of $298.4 million available to offset future income. Of these foreign NOLs, $286.1 million can be carried forward indefinitely and $12.3 million , if not utilized, will expire at various times between 2022 and 2037. During 2017 , the Company recognized tax benefits related to NOLs of $103.8 million . Included in this amount is $74.0 million of tax benefits of acquired attributes which was recorded as a reduction in goodwill. At December 31, 2017 , the Company has tax credit carryforwards of $3.4 million relating to federal and state tax credits for research activities. Of these credit carryforwards, $0.6 million can be carried forward indefinitely and $2.8 million will expire between 2033 and 2037. The Company regularly assesses the realizability of deferred tax assets considering all available evidence including, to the extent applicable, the nature, frequency and severity of prior cumulative losses, forecasts of future taxable income, tax filing status, the duration of statutory carryforward periods, available tax planning and historical experience. As of December 31, 2017 , the Company has a gross deferred tax asset of $84.4 million that the Company expects to fully utilize on a more likely than not basis. However, the tax sharing agreement between ANGI Homeservices and IAC governs the parties’ respective rights, responsibilities and obligations with respect to tax matters, including responsibility for taxes attributable to ANGI Homeservices, entitlement to refunds, allocation of tax attributes and other matters. Any differences between taxes currently due or receivable under the tax sharing agreement and the current tax provision computed on an as if standalone, separate return basis are reflected as adjustments to additional paid-in capital. During 2017 , the Company’s valuation allowance increased by $47.4 million primarily due to the establishment of foreign NOLs related to a recent acquisition. At December 31, 2017 , the Company has a valuation allowance of $61.6 million related to the portion of NOLs and other items for which it is more likely than not that the tax benefit will not be realized. A reconciliation of the income tax (benefit) provision to the amounts computed by applying the statutory federal income tax rate to earnings before income taxes is shown as follows: Years Ended December 31, 2017 2016 2015 (In thousands) Income tax (benefit) provision at the federal statutory rate of 35% $ (53,771 ) $ 7,862 $ (783 ) Change in tax reserves, net 235 (72 ) 1,895 State income taxes, net of effect of federal tax benefit (3,678 ) 1,063 (39 ) Unbenefited losses 5,915 2,592 1,133 Research credit (784 ) (930 ) (645 ) Federal tax rate change to 21% 33,002 — — Stock-based compensation (32,702 ) — — Other, net 2,677 1,319 197 Income tax (benefit) provision $ (49,106 ) $ 11,834 $ 1,758 A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: December 31, 2017 2016 2015 (In thousands) Balance at January 1 $ 602 $ 1,863 $ 129 Additions based on tax positions related to the current year 235 279 376 Additions for tax positions of prior years 711 — 1,358 Reductions for tax positions of prior years — (263 ) — Settlements — (1,277 ) — Balance at December 31 $ 1,548 $ 602 $ 1,863 The Company recognizes interest and, if applicable, penalties related to unrecognized tax benefits in the income tax provision. At both December 31, 2017 and December 31, 2016 , the Company has not accrued any amount for the payment of either interest or penalties. ANGI Homeservices is routinely under audit by federal, state, local and foreign authorities in the area of income tax as a result of previously filed separate company and consolidated tax returns with IAC. These audits include questioning the timing and the amount of income and deductions and the allocation of income and deductions among various tax jurisdictions. The Internal Revenue Service is currently auditing IAC’s federal income tax returns for the years ended December 31, 2010 through 2012, which includes the operations of the HomeAdvisor business. The statute of limitations for the years 2010 through 2012 has been extended to June 30, 2019, and the statute of limitations for the year 2013 has been extended to June 30, 2018. Returns filed in various other jurisdictions are open to examination for various tax years beginning with 2009. Income taxes payable include reserves considered sufficient to pay assessments that may result from examination of prior year tax returns. We consider many factors when evaluating and estimating our tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate actual outcomes. Although management currently believes changes to reserves from period to period and differences between amounts paid, if any, upon resolution of issues raised in audits and amounts previously provided will not have a material impact on liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. At December 31, 2017 and 2016 , unrecognized tax benefits are $1.5 million and $0.6 million respectively, for tax positions included in IAC’s consolidated tax return filings. If unrecognized tax benefits at December 31, 2017 are subsequently recognized, income tax provision would be reduced by $1.5 million . The comparable amount as of December 31, 2016 is $0.6 million . On December 22, 2017, the U.S. enacted the Tax Act. The Tax Act implements a number of changes that take effect on January 1, 2018, including, but not limited to, a reduction of the U.S. federal corporate income tax rate from 35% to 21% and a new minimum tax on intangible income earned by foreign subsidiaries. The Company's income tax provision for the year ended December 31, 2017 , includes an expense of $33.0 million related to the Tax Act, for the remeasurement of U.S. net deferred tax assets due to the reduction in the corporate income tax rate. The Company was not subject to the one-time transition tax because it has cumulative losses from its international operations. While the Company was able to make a reasonable estimate of the impacts of the Tax Act, certain amounts are provisional as the Company gathers additional data. Any adjustment of the Company’s provisional tax expense will be reflected as a change in estimate in its results in the period in which the change in estimate is made in accordance with Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act. In addition, our estimates may also be impacted and adjusted as the law is clarified and additional guidance is issued at the federal and state levels. |
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATIONS | BUSINESS COMBINATIONS Angie's List Combination Through the Combination, the Company acquired 100% of the common stock of Angie's List on September 29, 2017 for a total purchase price valued at $781.4 million . The purchase price of $781.4 million was determined based on the sum of (i) the fair value of the 61.3 million shares of Angie's List common stock outstanding immediately prior to the Combination based on the closing stock price of Angie's List common stock on the NASDAQ on September 29, 2017 of $12.46 per share; (ii) the cash consideration of $1.9 million paid to holders of Angie's List common stock who elected to receive $8.50 in cash per share; and (iii) the fair value of vested equity awards (including the pro rata portion of unvested awards attributable to pre-combination services) outstanding under Angie's List stock plans on September 29, 2017 . Each stock option to purchase shares of Angie's List common stock that was outstanding immediately prior to the effective time of the Combination was, as of the effective time of the Combination, converted into an option to purchase (i) that number of Class A shares of ANGI Homeservices equal to the total number of shares of Angie's List common stock subject to such Angie's List option immediately prior to the effective time of the Combination, (ii) at a per-share exercise price equal to the exercise price per share of Angie's List common stock at which such Angie's List option was exercisable immediately prior to the effective time of the Combination. Each award of Angie's List restricted stock units that was outstanding immediately prior to the effective time of the Combination was, as of the effective time of the Combination, converted into an ANGI Homeservices restricted stock unit award with respect to a number of Class A shares of ANGI Homeservices equal to the total number of shares of Angie's List common stock subject to such Angie's List restricted stock unit award immediately prior to the effective time of the Combination. The table below summarizes the purchase price: Angie's List (In thousands) Class A common stock $ 763,684 Cash consideration for holders who elected to receive $8.50 in cash per share of Angie's List common stock 1,913 Fair value of vested and pro rata portion of unvested stock options attributable to pre-combination services 11,749 Fair value of the pro rata portion of unvested restricted stock units attributable to pre-combination services 4,038 Total purchase price $ 781,384 The financial results of Angie's List are included in the Company's consolidated and combined financial statements, within the North America segment, beginning September 29, 2017 . For the year ended December 31, 2017 , the Company included $58.9 million of revenue and $21.7 million of net loss in its consolidated and combined statement of operations related to Angie's List. The net loss of Angie's List reflects $28.7 million in stock-based compensation expense related to (i) the acceleration of previously issued Angie's List equity awards held by employees terminated in connection with the Combination and (ii) the expense related to previously issued Angie's List equity awards, severance and retention costs of $19.8 million related to the Combination and a reduction in revenue of $7.8 million due to the write-off of deferred revenue related to the Combination. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of combination: Angie's List (In thousands) Cash and cash equivalents $ 44,270 Other current assets 11,280 Property and equipment 16,341 Goodwill 545,204 Intangible assets 317,300 Total assets 934,395 Deferred revenue (32,595 ) Other current liabilities (46,150 ) Long-term debt - related party (61,498 ) Deferred income taxes (11,363 ) Other long-term liabilities (1,405 ) Net assets acquired $ 781,384 The purchase price was based on the expected financial performance of Angie's List, not on the value of the net identifiable assets at the time of combination. This resulted in a significant portion of the purchase price being attributed to goodwill because Angie's List is complementary and synergistic to the other North America businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of combination are as follows: Angie's List (In thousands) Weighted-average useful life (years) Indefinite-lived trade name and trademarks $ 137,000 Indefinite Service professionals 90,500 3 Developed technology 63,900 6 Memberships 15,900 3 User base 10,000 1 Total identifiable intangible assets acquired $ 317,300 Other current assets, current liabilities and other long-term liabilities of Angie's List were reviewed and adjusted to their fair values at the date of combination, as necessary. The fair value of deferred revenue was determined using an income approach that utilized a cost to fulfill analysis. The fair value of the trade name and trademarks was determined using an income approach that utilized the relief from royalty methodology. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The fair values of the service professionals and memberships were determined using an income approach that utilized the excess earnings methodology. The valuations of deferred revenue and intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows, cost and profit margins related to deferred revenue and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. HomeStars Acquisition The Company acquired a 90% voting interest in HomeStars Inc. ("HomeStars"), a leading home services platform in Canada, on February 8, 2017. The purchase price for HomeStars was $16.6 CAD million (or $12.7 million ) in cash and is net of a $0.3 CAD million (or $0.2 million ) working capital adjustment paid in full to the Company in the third quarter of 2017. In connection with the acquisition, the Company measured and recorded the acquisition date fair value of the 10% noncontrolling interest in HomeStars, which totaled $1.9 CAD million (or $1.4 million ). The determination of the fair value of noncontrolling interest was calculated using the implied value of 100% of the enterprise value of the business using the purchase price. The financial results of HomeStars are included in the Company's consolidated and combined financial statements, within the North America segment, beginning February 8, 2017. For the year ended December 31, 2017 , the Company included $6.5 million of revenue and $1.2 million of net loss in its consolidated and combined statement of operations related to HomeStars. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: HomeStars (In thousands) Cash and cash equivalents $ 181 Other current assets 165 Goodwill 9,841 Intangible assets 6,414 Total assets 16,601 Current liabilities (649 ) Other long-term liabilities (1,873 ) Net assets acquired $ 14,079 The purchase price was based on the expected financial performance of HomeStars, not on the value of the net identifiable assets at the time of acquisition. This resulted in a significant portion of the purchase price being attributed to goodwill because HomeStars is complementary and synergistic to the other North America businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: HomeStars (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 2,358 Indefinite Contractor relationships 2,435 2 Developed technology 1,522 2 User base 99 1 Total identifiable intangible assets acquired $ 6,414 Other current assets, current liabilities and other long-term liabilities of HomeStars were reviewed and adjusted to their fair values at the date of acquisition, as necessary. The fair values of the trade name and contractor relationships were determined using variations of the income approach; specifically, in respective order, the relief from royalty and excess earnings methodologies. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The valuations of the intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. MyBuilder Acquisition The Company acquired a 75% voting interest in MyBuilder Limited ("MyBuilder"), a leading home services platform in the United Kingdom, on March 24, 2017. The purchase price was £32.6 million (or $40.7 million ) in cash and includes a £0.6 million (or $0.8 million ) working capital adjustment paid in full by the Company in the third quarter of 2017. In connection with the acquisition, the Company measured and recorded the acquisition date fair value of the 25% noncontrolling interest in MyBuilder, which totaled £10.7 million (or $13.3 million ). The determination of the fair value of noncontrolling interest was calculated using the implied value of 100% of the enterprise value of the business using the purchase price. The financial results of MyBuilder are included in the Company's consolidated and combined financial statements, within the Europe segment, beginning April 1, 2017. For the year ended December 31, 2017 , the Company included $8.0 million of revenue and $1.4 million of net loss in its consolidated and combined statement of operations related to MyBuilder. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: MyBuilder (In thousands) Cash and cash equivalents $ 6,004 Other current assets 344 Goodwill 37,072 Intangible assets 15,239 Total assets 58,659 Current liabilities (2,065 ) Other long-term liabilities (2,595 ) Net assets acquired $ 53,999 The purchase price was based on the expected financial performance of MyBuilder, not on the value of the net identifiable assets at the time of acquisition. This resulted in a significant portion of the purchase price being attributed to goodwill because MyBuilder is complementary and synergistic to the other European businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: MyBuilder (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 7,994 Indefinite Contractor relationships 4,122 2 Developed technology 1,499 2 User base 1,624 1 Total identifiable intangible assets acquired $ 15,239 Other current assets, current liabilities and other long-term liabilities of MyBuilder were reviewed and adjusted to their fair values at the date of acquisition, as necessary. The fair values of the trade name and contractor relationships were determined using variations of the income approach; specifically, in respective order, the relief from royalty and excess earnings methodologies. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The valuations of the intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. MyHammer Acquisition On November 3, 2016, the Company acquired a 70% voting interest in MyHammer Holding AG ("MyHammer"), the leading home services marketplace in Germany. The purchase price was €17.7 million (or $19.7 million ). In connection with the acquisition, the Company measured and recorded the acquisition date fair value of the 30% noncontrolling interest in MyHammer, which totaled €9.4 million (or $10.4 million ). The determination of the fair value of noncontrolling interest was calculated using the MyHammer share price on the acquisition date. In 2017 , the Company increased its ownership stake in MyHammer to 81.1% . The financial results of MyHammer are included in the Company's consolidated and combined financial statements, within the Europe segment, with effect from the date of acquisition. For the years ended December 31, 2017 and 2016 , the Company included $12.7 million and $1.3 million of revenue, respectively, and less than $0.1 million and $(0.4) million of net income (loss), respectively, in its consolidated and combined statement of operations related to MyHammer. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: MyHammer (In thousands) Cash and cash equivalents $ 4,041 Other current assets 790 Goodwill 22,277 Intangible assets 8,107 Total assets 35,215 Current liabilities (2,642 ) Other long-term liabilities (2,447 ) Net assets acquired $ 30,126 The purchase price was based on the expected financial performance of MyHammer, not on the value of the net identifiable assets at the time of acquisition. This resulted in a significant portion of the purchase price being attributed to goodwill because MyHammer is complementary and synergistic to the other European businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: MyHammer (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 4,553 Indefinite Contractor relationships 1,444 4 Developed technology 1,222 3 User base 888 1 Total identifiable intangible assets acquired $ 8,107 Other current assets, current liabilities and other long-term liabilities of MyHammer were reviewed and adjusted to their fair values at the date of acquisition, as necessary. The fair values of the trade name and contractor relationships were determined using variations of the income approach; specifically, in respective order, the relief from royalty and excess earnings methodologies. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The valuations of the intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. Unaudited pro forma financial information The unaudited pro forma financial information in the table below presents the combined results of the Company and Angie's List, HomeStars, MyBuilder and MyHammer as if these acquisitions had occurred on January 1, 2016. The unaudited pro forma financial information includes adjustments required under the acquisition method of accounting and is presented for informational purposes only and is not necessarily indicative of the results that would have been achieved had the acquisitions actually occurred on January 1, 2016. For the year ended December 31, 2017 , pro forma adjustments include (i) reductions in stock-based compensation expense of $96.9 million and transaction related costs of $35.2 million because they are one-time in nature and will not have a continuing impact on operations; and (ii) an increase in amortization of intangibles of $31.2 million . The stock-based compensation expense is primarily related to the modification of previously issued HomeAdvisor vested equity awards, which were converted into ANGI Homeservices' equity awards, and the acceleration of previously issued Angie's List equity awards held by employees terminated in connection with the Combination. The transaction related costs include severance and retention costs of $19.8 million related to the Combination. For the year ended December 31, 2016 , pro forma adjustments include a reduction in revenue of $35.0 million due to the write-offs of deferred revenue at the assumed date of acquisition as well as increases in stock-based compensation expense of $81.7 million and amortization of intangibles of $64.0 million . Years Ended December 31, 2017 2016 (In thousands, except per share data) Revenue $ 962,597 $ 809,999 Net loss attributable to ANGI Homeservices Inc. shareholders $ (36,459 ) $ (86,557 ) Basic and diluted loss per share attributable to ANGI Homeservices Inc. shareholders $ (0.08 ) $ (0.21 ) TRANSACTION AND INTEGRATION RELATED COSTS IN CONNECTION WITH THE COMBINATION During the year ended December 31, 2017 , the Company incurred $44.1 million in costs related to the Combination (including severance, retention, transaction and integration related costs) as well as deferred revenue write-offs of $7.8 million . The Company also incurred $122.1 million in stock-based compensation expense during 2017 related to the modification of previously issued HomeAdvisor vested and unvested equity awards, which were converted into ANGI Homeservices' equity awards, the expense related to previously issued Angie's List equity awards and the acceleration of certain Angie's List equity awards resulting from the termination of employees in connection with the Combination. See " Note 4—Business Combinations " for additional information on the Combination. A summary of the costs incurred, payments made and the related accrual at December 31, 2017 is presented below. Year Ended December 31, 2017 (In thousands) Transaction and integration related costs $ 44,101 Stock-based compensation expense 122,066 Total $ 166,167 December 31, 2017 (In thousands) Charges incurred $ 44,101 Payments made (35,621 ) Accrual as of December 31 $ 8,480 The costs are allocated as follows in the accompanying consolidated and combined statement of operations: Year Ended December 31, 2017 Transaction and Integration Related Costs Stock-based Compensation Expense Total (In thousands) Cost of revenue $ — $ — $ — Selling and marketing expense 7,430 24,416 31,846 General and administrative expense 36,120 83,420 119,540 Product development expense 551 14,230 14,781 Total $ 44,101 $ 122,066 $ 166,167 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Goodwill and intangible assets, net are as follows: December 31, 2017 2016 (In thousands) Goodwill $ 770,226 $ 170,990 Intangible assets with indefinite lives 153,447 4,884 Intangible assets with definite lives, net of accumulated amortization 175,124 5,908 Total goodwill and intangible assets, net $ 1,098,797 $ 181,782 The following table presents the balance of goodwill by reportable segment, including the changes in the carrying value of goodwill, for the year ended December 31, 2017 : Balance at Additions Deductions Foreign Balance at December 31, (In thousands) North America $ 140,930 $ 555,045 $ — $ 316 $ 696,291 Europe 30,060 37,257 — 6,618 73,935 Total goodwill $ 170,990 $ 592,302 $ — $ 6,934 $ 770,226 Additions relate to the acquisitions of Angie's List and HomeStars (included in the North America segment) and MyBuilder (included in the Europe segment). The following table presents the balance of goodwill by reportable segment, including the changes in the carrying value of goodwill, for the year ended December 31, 2016 : Balance at Additions (Deductions) Foreign Balance at (In thousands) North America $ 140,930 $ — $ — $ — $ 140,930 Europe 9,700 21,985 — (1,625 ) 30,060 Total goodwill $ 150,630 $ 21,985 $ — $ (1,625 ) $ 170,990 Additions relate to the acquisition of MyHammer. Intangible assets with indefinite lives are trade names and trademarks acquired in various acquisitions. At December 31, 2017 and December 31, 2016 , intangible assets with definite lives are as follows: December 31, 2017 Gross Accumulated Net Weighted-average (Dollars in thousands) Contractor and service professional relationships $ 99,497 $ (11,452 ) $ 88,045 3.0 Technology 78,690 (14,127 ) 64,563 5.6 Memberships 15,900 (1,340 ) 14,560 3.0 Customer lists and user base 12,788 (4,906 ) 7,882 1.0 Trade names 4,538 (4,464 ) 74 2.6 Total $ 211,413 $ (36,289 ) $ 175,124 3.8 December 31, 2016 Gross Accumulated Net Weighted-average (Dollars in thousands) Contractor relationships $ 1,830 $ (495 ) $ 1,335 4.0 Technology 11,377 (7,834 ) 3,543 4.3 Customer lists and user base 4,136 (3,432 ) 704 1.8 Trade names 5,260 (4,934 ) 326 2.9 Total $ 22,603 $ (16,695 ) $ 5,908 3.5 At December 31, 2017 , amortization of intangible assets with definite lives for each of the next five years and thereafter is estimated to be as follows: Years ending December 31, (In thousands) 2018 $ 60,657 2019 47,731 2020 37,477 2021 10,650 2022 10,650 Thereafter 7,959 Total $ 175,124 |
FAIR VALUE MEASUREMENTS AND FIN
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS | FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis: December 31, 2017 Quoted market Significant Significant Total (In thousands) Assets: Cash equivalents: Money market funds $ 189,207 $ — $ — $ 189,207 Treasury discount notes 500 — — 500 Certificates of deposit — 6,195 — 6,195 Total $ 189,707 $ 6,195 $ — $ 195,902 December 31, 2016 Quoted market prices in active markets for identical assets Significant Significant Total (In thousands) Assets: Cash equivalents: Money market funds $ 28,064 $ — $ — $ 28,064 Total $ 28,064 $ — $ — $ 28,064 Financial instruments measured at fair value only for disclosure purposes The following table presents the carrying value and the fair value of financial instruments measured at fair value only for disclosure purposes: December 31, 2017 December 31, 2016 Carrying value Fair value Carrying value Fair value (In thousands) Current portion of long term debt $ (13,750 ) $ (13,802 ) $ — $ — Long-term debt, net (258,312 ) (262,230 ) — — Current portion of long-term debt—related party (816 ) (837 ) (2,838 ) (2,776 ) Long-term debt—related party, net (1,997 ) (2,048 ) (47,000 ) (46,324 ) The fair value of long-term debt, including the current portion, is estimated using market prices or indices for similar liabilities and taking into consideration other factors such as credit quality and maturity, which are Level 3 inputs. The fair value of long-term debt—related party, including the current portion, is based on Level 3 inputs and is estimated by discounting the future cash flows based on current market conditions. |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt consists of: December 31, 2017 2016 (In thousands) Term Loan due November 1, 2022 $ 275,000 $ — Less: current portion of Term Loan 13,750 — Less: unamortized debt issuance costs 2,938 — Total long-term debt, net $ 258,312 $ — See " Note 15—Related Party Transactions " for a description of related-party long-term debt. Term Loan On November 1, 2017, the Company borrowed $275 million under a five -year term loan facility ("Term Loan"). The Term Loan currently bears interest at LIBOR plus 2.00% , or 3.38% at December 31, 2017 , which is subject to change based on the Company's consolidated net leverage ratio. Interest payments are due at least quarterly through the term of the loan and quarterly principal payments of 1.25% of the original principal amount in the first three years, 2.5% in the fourth year and 3.75% in the fifth year are required. A portion of the proceeds from the Term Loan were used to repay the Intercompany Notes outstanding to IAC and its subsidiaries on November 1, 2017, see " Note 15—Related Party Transactions " for additional information, and the remaining proceeds will be used for general corporate purposes. There are additional covenants under the Term Loan that limit the ability of the Company and its subsidiaries to, among other things, incur indebtedness, pay dividends or make distributions. The Term Loan is guaranteed by the Company's wholly-owned material domestic subsidiaries and is secured by substantially all assets of the Company and the guarantors, subject to certain exceptions. Long-term debt maturities: Years Ending December 31, (In thousands) 2018 $ 13,750 2019 13,750 2020 13,750 2021 27,500 2022 206,250 Total 275,000 Less: current portion of Term Loan 13,750 Less: unamortized debt issuance costs 2,938 Total long-term debt, net $ 258,312 |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | SHAREHOLDERS' EQUITY Description of Class A Common Stock, Class B Convertible Common Stock and Class C Common Stock The rights of holders of ANGI Homeservices Class A common stock, Class B common stock and Class C common stock are identical, except for voting rights, conversion rights and dividend rights. Holders of Class A common stock are entitled to one vote per share on all matters to be voted upon by the stockholders. Holders of Class B common stock are entitled to ten votes per share on all matters to be voted upon by stockholders. Holders of Class C common stock have no voting rights, except as otherwise required by the laws of the State of Delaware, in which case holders of Class C common stock are entitled to one one-hundredth (1/100) of a vote per share. Holders of the Company's Class A common stock, Class B common stock and Class C common stock do not have cumulative voting rights in the election of directors. Shares of ANGI Homeservices Class B common stock are convertible into shares of our Class A common stock at the option of the holder at any time on a share for share basis. Such conversion ratio will in all events be equitably preserved in the event of any recapitalization of ANGI Homeservices by means of a stock dividend on, or a stock split or combination of, our outstanding Class A common stock or Class B common stock, or in the event of any merger, consolidation or other reorganization of ANGI Homeservices with another corporation. Upon the conversion of a share of our Class B common stock into a share of our Class A common stock, the applicable share of Class B common stock will be retired and will not be subject to reissue. Shares of Class A common stock and Class C common stock have no conversion rights. The holders of shares of ANGI Homeservices Class A common stock, Class B common stock and Class C common stock are entitled to receive, share for share, such cash dividends as may be declared by ANGI Homeservices Board of Directors out of funds legally available therefore. In the event of a liquidation, dissolution or winding up, holders of the Company's Class A common stock, Class B common stock and Class C common stock are entitled to receive ratably the assets available for distribution to the stockholders after payment of all liabilities and accrued but unpaid dividends and liquidation preferences on any outstanding preferred stock. At December 31, 2017 , IAC holds 415.2 million shares of our Class B common stock, which represents all of our outstanding Class B common stock and an 86.9% economic interest and 98.5% voting interest in the Company. In the event that ANGI Homeservices issues or proposes to issue any shares of ANGI Homeservices Class A common stock, Class B common stock or Class C common stock (with certain limited exceptions), including shares issued upon the exercise, conversion or exchange of options, warrants and convertible securities, IAC will generally have a purchase right that permits it to purchase for fair market value, as defined in the agreement, up to such number of shares of the same class as the issued shares as would (i) enable IAC to maintain the same ownership interest in the Company that it had immediately prior to such issuance or proposed issuance, with respect to issuances of our voting capital stock, or (ii) enable IAC to maintain ownership of at least 80.1% of each class of the Company's non-voting capital stock, with respect to issuances of our non-voting capital stock. Reserved Common Shares In connection with equity compensation plans, 80.0 million shares of ANGI Homeservices common stock are reserved at December 31, 2017 . |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) For the years ended December 31, 2017 , 2016 and 2015 , the Company's accumulated other comprehensive income (loss) relates to foreign currency translation adjustments, which is presented in the table below. Years Ended December 31, 2017 2016 2015 (In thousands) Balance at January 1 $ (1,721 ) $ (1,064 ) $ (483 ) Other comprehensive income (loss) before reclassifications 3,980 (657 ) (581 ) Amounts reclassified to earnings (27 ) — — Net current period other comprehensive income (loss) 3,953 (657 ) (581 ) Balance at December 31 $ 2,232 $ (1,721 ) $ (1,064 ) The amount reclassified out of accumulated other comprehensive income (loss) into earnings for the year ended December 31, 2017 relates to the liquidation of an international subsidiary. At December 31, 2017 , 2016 and 2015 , there was no tax benefit or provision on the accumulated other comprehensive income (loss). |
(LOSS) EARNINGS PER SHARE
(LOSS) EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
(LOSS) EARNINGS PER SHARE | (LOSS) EARNINGS PER SHARE The following table sets forth the computation of basic and diluted (loss) earnings per share attributable to ANGI Homeservices shareholders: Years Ended December 31, 2017 2016 2015 Basic Diluted Basic Diluted Basic Diluted (In thousands, except per share data) Numerator: Net (loss) earnings $ (104,527 ) $ (104,527 ) $ 10,631 $ 10,631 $ (3,996 ) $ (3,996 ) Net loss attributable to noncontrolling interests 1,409 1,409 2,497 2,497 2,671 2,671 Net (loss) earnings attributable to ANGI Homeservices Inc. shareholders $ (103,118 ) $ (103,118 ) $ 13,128 $ 13,128 $ (1,325 ) (1,325 ) Denominator: Weighted average basic shares outstanding 430,612 430,612 414,754 414,754 414,754 414,754 Dilutive securities including stock appreciation rights, stock options, RSUs and subsidiary denominated equity awards (a) — — — — — — Denominator for earnings per share—weighted average shares (b) 430,612 430,612 414,754 414,754 414,754 414,754 (Loss) earnings per share attributable to ANGI Homeservices Inc. shareholders: (Loss) earnings per share $ (0.24 ) $ (0.24 ) $ 0.03 $ 0.03 $ (0.00 ) $ (0.00 ) ________________________ (a) For the year ended December 31, 2017 , the Company had a loss from operations and as a result, approximately 54.1 million potentially dilutive securities were excluded from computing dilutive earnings per share because the impact would have been anti-dilutive. Accordingly, the weighted average basic shares outstanding were used to compute diluted earnings per share amounts. (b) The Company computed basic and diluted earnings per share for the years ended December 31, 2016 and 2015 using the shares issued to IAC for the contribution of the HomeAdvisor business. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION The Company currently has one active stock plan, which became effective in 2017 upon the completion of the Combination. This plan replaces the HomeAdvisor 2013 Incentive plan, which governed equity awards prior to the Combination. The 2017 plan covers stock options, stock appreciation rights and RSU awards denominated in shares of ANGI Homeservices common stock, as well as provides for the future grant of these and other equity awards. The 2017 plan authorizes the Company to grant awards to its employees, officers, directors and consultants. At December 31, 2017 , there are 25.8 million shares available for grant under the 2017 plan. The 2017 plan has a stated term of ten years , and provides that the exercise price of stock options and stock appreciation rights granted will not be less than the market price of the Company's common stock on the grant date. The plan does not specify grant dates or vesting schedules for awards, as those determinations have been delegated to the Compensation Committee of ANGI Homeservices Board of Directors (the “Committee”). Each grant agreement reflects the grant date and vesting schedule for that particular grant as determined by the Committee. Stock options and stock appreciation rights granted subsequent to the Combination through December 31, 2017 generally vest in equal annual installments over a four -year period from the grant date. RSU awards granted subsequent to the Combination through December 31, 2017 generally cliff-vest three years from the grant date. Stock-based compensation expense recognized in the consolidated and combined statement of operations includes expense related to: (i) the Company's stock options, stock appreciation rights and RSUs; (ii) equity instruments denominated in shares of its subsidiaries; and (iii) IAC denominated stock options and PSUs held by ANGI Homeservices employees. The amount of stock-based compensation expense recognized is net of estimated forfeitures, as the expense recorded is based on awards that are ultimately expected to vest. The forfeiture rate is estimated at the grant date based on historical experience and revised, if necessary, in subsequent periods if actual forfeitures differ from the estimated rate. At December 31, 2017 , there is $188.4 million of unrecognized compensation cost, net of estimated forfeitures, related to all equity-based awards, which is expected to be recognized over a weighted average period of approximately 2.4 years. The total income tax benefit recognized in the accompanying consolidated and combined statement of operations for the years ended December 31, 2017 , 2016 and 2015 related to stock-based compensation is $71.1 million , $3.4 million and $3.0 million , respectively. The increase in total income tax benefit recognized during 2017 is due to the adoption of ASU 2019-06 and the recognition of excess tax benefits attributable to stock-based compensation included as a component of the current year provision for income taxes rather than recognized in equity. The Company will recognize a corporate income tax deduction based on the intrinsic value of the stock options exercised in 2017 , however, there will be some delay in the timing of the realization of the cash benefit of the income tax deduction because it will be dependent upon the amount and timing of future taxable income and the timing of estimated income tax payments. The income tax benefit to be realized on stock option deductions, including those net settled, for the year ended December 31, 2017 , is $47.3 million . The income tax benefit realized on stock options deductions, including those net settled, for the years ended December 31, 2016 and 2015 are $8.8 million and $0.2 million , respectively. Stock options and stock appreciation rights Stock options and stock appreciation rights outstanding at December 31, 2017 and changes during the year ended December 31, 2017 is as follows: December 31, 2017 Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (In Years) Aggregate Intrinsic Value (Shares and intrinsic value in thousands) Outstanding HomeAdvisor (US) stock appreciation rights at January 1, 2017 13,830 $ 3.97 Granted 4,720 16.83 Exercised (6,659 ) 2.87 Forfeited (110 ) 9.86 Outstanding HomeAdvisor (US) stock appreciation rights prior to the Combination on September 29, 2017 11,781 9.69 Converted HomeAdvisor (US) stock appreciation rights in connection with the Combination 43,780 2.61 Converted Angie's List stock options in connection with the Combination 5,290 10.56 Granted 948 11.32 Exercised (1,948 ) 7.40 Forfeited (331 ) 6.86 Expired (624 ) 17.94 Outstanding at December 31, 2017 47,115 $ 3.25 7.1 $ 346,595 Exercisable 17,358 $ 2.22 4.7 $ 148,729 The aggregate intrinsic value in the table above represents the difference between ANGI Homeservices closing stock price on the last trading day of 2017 and the exercise price, multiplied by the number of in-the-money awards that would have been exercised had all award holders exercised their awards on December 31, 2017 . The total intrinsic value of awards exercised during the years ended December 31, 2017 , 2016 and 2015 is $100.7 million , $21.7 million and $0.2 million , respectively. The following table summarizes the information about stock options and stock appreciation rights outstanding and exercisable at December 31, 2017 : Awards Outstanding Awards Exercisable Range of Exercise Prices Outstanding at December 31, 2017 Weighted Average Remaining Contractual Life in Years Weighted Average Exercise Price Exercisable at December 31, 2017 Weighted Average Remaining Contractual Life in Years Weighted Average Exercise Price (Shares in thousands) $0.01 to $3.00 26,143 6.0 $ 1.32 15,462 4.8 $ 0.99 $3.01 to $6.00 17,580 9.1 4.54 50 6.5 5.82 $6.01 to $9.00 1,210 5.5 7.66 711 4.1 7.68 $9.01 to $12.00 950 9.0 10.57 202 6.3 9.92 $12.01 to $15.00 718 718 5.6 13.12 420 3.0 13.34 $15.01 to $18.00 239 239 0.5 17.71 238 0.4 17.72 $18.01 to $21.00 192 192 5.2 19.88 192 5.2 19.88 $21.01 to $24.00 83 83 4.8 22.51 83 4.8 22.51 47,115 7.1 $ 3.25 17,358 4.7 $ 2.22 The fair value of stock options and stock appreciation rights is estimated on the grant date using the Black-Scholes option pricing model. The Black-Scholes option pricing model incorporates various assumptions, including expected volatility and expected term. Prior to the Combination, expected stock price volatilities were estimated based on historical stock price volatilities of a group of peer companies. Subsequent to the Combination, expected stock price volatilities were estimated based on the average of IAC's historical volatility, as a result of the Company representing a large percentage of the overall value of IAC, and the historical stock price volatilities of the aforementioned group of peer companies. The risk-free interest rates are based on U.S. Treasuries with comparable terms as the awards, in effect at the grant date. Prior to the Combination, expected term was based upon the mid-point of the first and last windows for exercise. Subsequent to the Combination, expected term is based upon the historical exercise pattern of IAC's employees for comparable awards, a ten-year contractual life with vesting in four equal annual installments, because the Company does not have sufficient data to estimate an expected term for these awards. No dividends have been assumed. The following are the weighted average assumptions used in the Black-Scholes option pricing model: Years Ended December 31, 2017 2016 2015 Expected volatility 50 % 44 % 48 % Risk-free interest rate 2.0 % 0.8 % 1.2 % Expected term 5.5 years 3.2 years 3.7 years Dividend yield — % — % — % Approximately 0.9 million stock options and stock appreciation rights were granted by the Company subsequent to the Combination through December 31, 2017 . Approximately 4.7 million , 2.1 million and 2.4 million stock appreciation rights were granted by the Company for the period prior to the Combination in 2017 , and for the years ended December 31, 2016 and 2015 , respectively. The per share weighted average grant date fair value of stock options and stock appreciation rights granted by the Company subsequent to the Combination through December 31, 2017 is $4.30 . The per share weighted average grant date fair value of stock appreciation rights granted by the Company for the period prior to the Combination in 2017 , and for the years ended December 31, 2016 and 2015 , are $8.24 , $3.13 and $1.34 , respectively. In connection with the Combination, the previously issued HomeAdvisor (US) stock appreciation rights were converted into ANGI Homeservices' equity awards resulting in a modification charge of $217.7 million of which $93.4 million was recognized as stock-based compensation expense in the year ended December 31, 2017 and the remaining charge will be recognized over the vesting period of the modified awards. During the second quarter of 2017 , the Company modified certain HomeAdvisor (US) stock appreciation rights and recognized a modification charge of $6.6 million . Cash received from stock option exercises for the period subsequent to the Combination through December 31, 2017 is $1.7 million . For periods prior to the Combination, no cash was received from the exercise of stock appreciation rights because they were net settled in shares of IAC’s common stock. In connection with the Combination, previously issued stock appreciation rights that related to common stock of HomeAdvisor (US) were converted into stock appreciation rights that are settleable in Class A shares of ANGI Homeservices. IAC may require those awards to be settled in either shares of IAC common stock or in Class A shares of the Company's common stock and, to the extent shares of IAC common stock are issued in settlement, the Company will reimburse IAC for the cost of those shares by issuing to IAC additional Class A shares of the Company's common stock. Assuming all vested and unvested stock appreciation rights outstanding on December 31, 2017 , which can only be exercised on a net basis, were exercised on that date, 16.4 million Class A shares of the Company's common stock would have been issued either (i) to IAC as reimbursement if the awards were settled in IAC shares or (ii) directly to award holders if IAC did not exercise its right to settle these awards in IAC shares. In either case, the Company would have remitted $171.3 million in cash in withholding taxes (assuming a 50% withholding rate) on behalf of the employees. Restricted stock units RSUs are awards in the form of phantom shares or units denominated in a hypothetical equivalent number of shares of ANGI Homeservices common stock and with the value of each RSU equal to the fair value of ANGI Homeservices common stock at the date of grant. Each RSU grant is subject to service-based vesting, where a specific period of continued employment must pass before an award vests. The expense is measured at the grant date as the fair value of ANGI Homeservices common stock and expensed as stock-based compensation over the vesting term. Prior to the Combination, there were no RSUs outstanding. Unvested RSUs outstanding at December 31, 2017 and changes during the year ended December 31, 2017 is as follows: RSUs Number of Shares Weighted Average Grant Date Fair Value (Shares in thousands) Converted Angie's List RSUs in connection with the Combination 4,957 $ 12.46 Granted 489 12.58 Vested (1,574 ) 12.46 Forfeited (977 ) 12.46 Unvested at December 31, 2017 2,895 $ 12.48 The per share weighted average grant date fair value of RSUs granted during the year ended December 31, 2017 based on market prices of ANGI Homeservices’ common stock on the grant date was $12.58 . The total fair value of RSUs that vested during the year ended December 31, 2017 was $19.2 million . Equity instruments denominated in the shares of certain subsidiaries ANGI Homeservices has granted stock appreciation rights and stock options denominated in the equity of its subsidiaries to employees and management of certain subsidiaries. These equity awards vest over a period of years, which is typically four years. The value of the stock appreciation rights and stock options is tied to the value of the common stock of these subsidiaries, which is determined by the Company using a variety of valuation techniques including a combination of market based and discounted cash flow valuation methodologies. Accordingly, these interests only have value to the extent the relevant business appreciates in value above the initial value utilized to determine the exercise price. These interests can have significant value in the event of significant appreciation. The interests are ultimately settled in IAC common stock or ANGI Homeservices common stock, at IAC's election, with fair value generally determined by negotiation or arbitration, at various dates through 2027. These equity awards are settled on a net basis, with the award holder entitled to receive a payment in shares equal to the intrinsic value of the award at exercise less an amount equal to the required cash tax withholding payment. The expense associated with these equity awards is initially measured at fair value, using the Black-Scholes option pricing model, at the grant date and is expensed as stock-based compensation over the vesting term. The plans under which these awards are granted establish specific settlement dates or liquidity events for which the valuation of the relevant subsidiary is determined for purposes of settlement of the awards. IAC denominated stock options There were no IAC stock options granted by IAC under its equity incentive plans to employees of ANGI Homeservices during the year ended December 31, 2017 . For each of the years ended December 31, 2016 and 2015 , approximately 0.1 million IAC stock options were granted by IAC under its equity incentive plans to employees of ANGI Homeservices. Approximately 0.2 million IAC options remain outstanding to employees of ANGI Homeservices as of December 31, 2017 . The fair value of each stock option award is estimated on the grant date using the Black-Scholes option-pricing model. IAC stock options are granted with exercise prices at least equal to the fair value on the date of grant, vest ratably in annual installments over a four -year period and expire ten years from the date of grant. IAC denominated performance stock units ("PSUs") There were 0.1 million IAC PSUs granted by IAC to employees of ANGI Homeservices during the year ended December 31, 2017 . There were no IAC PSUs granted by IAC to employees of ANGI Homeservices during the years ended December 31, 2016 and 2015 . PSUs are awards in the form of phantom shares or units, denominated in a hypothetical equivalent number of shares of IAC common stock and with the value of each PSU equal to the fair value of IAC common stock at the date of grant. Each PSU grant is subject to service-based vesting, where a specific period of continued employment must pass before an award vests and certain performance targets, set at the time of grant, must be achieved before an award vests. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company has two operating segments, North America and Europe, which are also the Company’s reportable segments. Each segment manager reports to the Company’s chief operating decision maker. The chief operating decision maker allocates resources and assesses performance at the segment level. Years Ended December 31, 2017 2016 2015 (In thousands) Revenue: North America $ 678,897 $ 461,847 $ 329,867 Europe 57,489 37,043 31,334 Total $ 736,386 $ 498,890 $ 361,201 Years Ended December 31, 2017 2016 2015 (In thousands) Operating (Loss) Income: North America $ (128,483 ) $ 32,464 $ 2,311 Europe (19,388 ) (8,406 ) (3,879 ) Total $ (147,871 ) $ 24,058 $ (1,568 ) Years Ended December 31, 2017 2016 2015 (In thousands) Adjusted EBITDA (a) : North America $ 50,182 $ 50,088 $ 18,184 Europe (11,019 ) (5,542 ) (1,471 ) Total $ 39,163 $ 44,546 $ 16,713 December 31, 2017 2016 (In thousands) Segment Assets: (b) North America $ 253,582 $ 24,630 Europe 10,868 50,249 Total $ 264,450 $ 74,879 Years Ended December 31, 2017 2016 2015 (In thousands) Capital expenditures: North America $ 24,214 $ 14,672 $ 9,933 Europe 2,623 1,988 237 Total $ 26,837 $ 16,660 $ 10,170 ___________________________ (a) The Company’s primary financial measure is Adjusted EBITDA, which is defined as operating income excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of amortization of intangible assets and impairments of goodwill and intangible assets, if applicable. The Company believes this measure is useful for analysts and investors as this measure allows a more meaningful comparison between our performance and that of our competitors. Moreover, our management uses this measure internally to evaluate the performance of our business as a whole and our individual business segments, and this measure is one of the primary metrics by which our internal budgets are based and by which management is compensated. The above items are excluded from our Adjusted EBITDA measure because these items are non-cash in nature, and we believe that by excluding these items, Adjusted EBITDA corresponds more closely to the cash operating income generated from our business, from which capital investments are made and long-term related party debt is serviced. Adjusted EBITDA has certain limitations in that it does not take into account the impact to ANGI Homeservices Inc.'s statement of operations of certain expenses. (b) Consistent with the Company's primary metric (described in (a) above), the Company excludes, if applicable, property and equipment, goodwill and intangible assets from the measure of segment assets presented above. The following table presents revenue disaggregated by service for the Company's reportable segments: Years Ended December 31, 2017 2016 2015 (In thousands) Marketplace: Consumer connection revenue (c) $ 521,481 $ 382,466 $ 269,309 Membership subscription revenue 56,135 43,573 24,164 Other revenue 3,798 2,827 3,423 Marketplace revenue 581,414 428,866 296,896 Advertising & Other revenue (d) 97,483 32,981 32,971 North America 678,897 461,847 329,867 Consumer connection revenue (c) 40,009 28,124 23,298 Membership subscription revenue 16,596 7,936 6,921 Advertising and other revenue 884 983 1,115 Europe 57,489 37,043 31,334 Revenue $ 736,386 $ 498,890 $ 361,201 ___________________________ (c) Fees paid by service professionals for consumer matches. (d) Includes Angie's List revenue from service professionals under contract for advertising and Angie's List membership subscription fees from consumers, as well as revenue from mHelpDesk, HomeStars and Felix. Geographic information about revenue and long-lived assets is presented below. Revenue by geography is based on where the customer is located. Years Ended December 31, 2017 2016 2015 (In thousands) Revenue United States $ 672,159 $ 461,372 $ 329,117 All other countries 64,227 37,518 32,084 Total $ 736,386 $ 498,890 $ 361,201 The United States is the only country whose revenue is greater than 10% of total revenue of the Company for the years ended December 31, 2017 , 2016 and 2015 . December 31, 2017 2016 (In thousands) Long-lived assets (excluding goodwill and intangible assets) United States $ 49,356 $ 21,775 All other countries 3,936 1,870 Total $ 53,292 $ 23,645 The following tables reconcile operating (loss) income for the Company’s reportable segments and net (loss) earnings attributable to ANGI Homeservices Inc. shareholders to Adjusted EBITDA: Year Ended December 31, 2017 Operating Stock-based Depreciation Amortization Adjusted EBITDA (In thousands) North America $ (128,483 ) $ 147,574 $ 13,243 $ 17,848 $ 50,182 Europe (19,388 ) 1,656 1,300 5,413 (11,019 ) Total (147,871 ) $ 149,230 $ 14,543 $ 23,261 $ 39,163 Interest expense—third party (1,765 ) Interest expense—related party (5,971 ) Other income, net 1,974 Loss before income taxes (153,633 ) Income tax benefit 49,106 Net loss (104,527 ) Net loss attributable to noncontrolling interests 1,409 Net loss attributable to ANGI Homeservices Inc. shareholders $ (103,118 ) Year Ended December 31, 2016 Operating Stock-based Depreciation Amortization Adjusted (In thousands) North America $ 32,464 $ 7,126 $ 7,996 $ 2,502 $ 50,088 Europe (8,406 ) 1,790 423 651 (5,542 ) Total 24,058 $ 8,916 $ 8,419 $ 3,153 $ 44,546 Interest expense—third party — Interest expense—related party (894 ) Other expense, net (699 ) Earnings before income taxes 22,465 Income tax provision (11,834 ) Net earnings 10,631 Net loss attributable to noncontrolling interests 2,497 Net earnings attributable to ANGI Homeservices Inc. shareholders $ 13,128 Year Ended December 31, 2015 Operating Stock-based Depreciation Amortization Adjusted (In thousands) North America $ 2,311 $ 6,758 $ 5,768 $ 3,347 $ 18,184 Europe (3,879 ) 1,095 825 488 (1,471 ) Total (1,568 ) $ 7,853 $ 6,593 $ 3,835 $ 16,713 Interest expense—third party — Interest expense—related party (272 ) Other expense, net (398 ) Loss before income taxes (2,238 ) Income tax provision (1,758 ) Net loss (3,996 ) Net loss attributable to noncontrolling interests 2,671 Net loss attributable to ANGI Homeservices Inc. shareholders $ (1,325 ) The following tables reconcile segment assets to total assets: December 31, 2017 Segment assets Property and equipment, net Goodwill Indefinite-lived intangible assets Definite-lived Total assets (In thousands) North America $ 253,582 $ 49,487 $ 696,291 $ 140,034 $ 169,054 $ 1,308,448 Europe 10,868 3,805 73,935 13,413 6,070 108,091 Total $ 264,450 $ 53,292 $ 770,226 $ 153,447 $ 175,124 $ 1,416,539 Add: Deferred tax assets (e) 50,723 Total assets $ 1,467,262 December 31, 2016 Segment assets Property and equipment, net Goodwill Indefinite-lived intangible assets Definite-lived Total assets (In thousands) North America $ 24,630 $ 21,775 $ 140,930 $ 600 $ 2,454 $ 190,389 Europe 50,249 1,870 30,060 4,284 3,454 89,917 Total $ 74,879 $ 23,645 $ 170,990 $ 4,884 $ 5,908 $ 280,306 Add: Deferred tax assets (e) 15,211 Total assets $ 295,517 ___________________________ (e) Total segment assets differ from total assets on a consolidated basis as a result of unallocated deferred tax assets. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Commitments The Company leases office space and equipment used in connection with its operations under various operating leases, the majority of which contain escalation clauses. Future minimum payments under operating lease agreements are as follows: Years ending December 31, (In thousands) 2018 $ 11,090 2019 13,728 2020 10,859 2021 9,578 2022 8,306 Thereafter 32,820 Total $ 86,381 Expenses charged to operations under these agreements are $8.9 million , $6.2 million and $5.8 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. The Company’s two most significant operating leases are a 10.5 -year lease for its call center in New York and a 10.5 -year lease for its corporate headquarters in Denver, Colorado which collectively approximate 58% of the future minimum payments due under all operating lease agreements in the table above. The Company also has funding commitments that could potentially require its performance in the event of demands by third parties or contingent events as follows: Amount of commitment expiration per period Less than 1 Year 1 to 3 years Total (In thousands) Purchase obligations $ 831 $ 650 $ 1,481 The purchase obligations primarily consist of software licenses. Contingencies In the ordinary course of business, the Company is a party to various lawsuits. The Company establishes reserves for specific legal matters when it determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable. Management has also identified certain other legal matters where we believe an unfavorable outcome is not probable and, therefore, no reserve is established. Although management currently believes that resolving claims against us, including claims where an unfavorable outcome is reasonably possible, will not have a material impact on the liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. The Company also evaluates other contingent matters, including income and non-income tax contingencies, to assess the likelihood of an unfavorable outcome and estimated extent of potential loss. It is possible that an unfavorable outcome of one or more of these lawsuits or other contingencies could have a material impact on the liquidity, results of operations, or financial condition of the Company. See " Note 3—Income Taxes " for additional information related to income tax contingencies. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Dec. 31, 2017 | |
Supplemental Cash Flow Information [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION Supplemental Disclosure of Non-Cash Transactions: On September 29, 2017, ANGI Homeservices issued 61.3 million shares of Class A common stock valued at $763.7 million in connection with the Combination. Supplemental Disclosure of Cash Flow Information: Years Ended December 31, 2017 2016 2015 (In thousands) Cash paid (received) during the year for: Interest—third party $ — $ — $ — Interest—related party 6,169 417 262 Income tax payments, including amounts paid to IAC for ANGI Homeservices share of IAC's consolidated tax liability 1,700 8,820 3,424 Income tax refunds (402 ) (263 ) (657 ) |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Relationship with IAC prior to the Combination For periods prior to the Combination, the Company’s combined statement of operations includes allocations of general and administrative costs, including stock-based compensation expense, related to IAC’s accounting, treasury, legal, tax, corporate support and internal audit functions. These allocations were based on the HomeAdvisor business' revenue as a percentage of IAC’s total revenue. Allocated general and administrative costs, inclusive of stock-based compensation expense, were $4.8 million , $4.2 million and $2.6 million for the years ended December 31, 2017 , 2016 , and 2015 , respectively, and are included in “General and administrative expense” in the accompanying consolidated and combined statement of operations. It is not practicable to determine the actual expenses that would have been incurred for these services had the HomeAdvisor business operated as a standalone entity during the periods presented. Management considers the allocation method to be reasonable. The following table summarizes the components of the net (increase) decrease in IAC’s investment in HomeAdvisor prior to the contribution of the HomeAdvisor business to ANGI Homeservices: December 31, 2017 2016 2015 (In thousands) Cash transfers (from) to IAC related to its centrally managed U.S. treasury management function, acquisitions and cash expenses paid by IAC on behalf of HomeAdvisor, net $ (80,368 ) $ (363 ) $ 8,801 Taxes 38,162 (5,968 ) (3,281 ) Interest income (a) 656 278 86 Allocation of general and administrative expense (4,789 ) (4,247 ) (2,598 ) Net (increase) decrease in IAC’s investment in HomeAdvisor $ (46,339 ) $ (10,300 ) $ 3,008 ________________________________ (a) Interest expense on long-term debt—related party is not included. The related party notes described below were settled in full immediately prior to the Combination. On October 14, 2016, the Company, through a foreign subsidiary, issued a promissory note due October 14, 2023 in the amount of $42.0 million to a foreign subsidiary of IAC that is not part of the HomeAdvisor business. The proceeds were used to finance the acquisition of MyHammer and refinance an $11.4 million loan that was previously outstanding. The promissory note bore interest at 11% per annum. On March 20, 2017, the Company, through two foreign subsidiaries, issued promissory notes in the amount of £21.0 million due March 20, 2024 (“Note A”) and $15.5 million due March 20, 2047 (“Note B”), respectively, to two foreign subsidiaries of IAC that are not part of the HomeAdvisor business. The proceeds were used to finance the acquisition of MyBuilder. Note A and Note B bore interest at 6.5% and 7% per annum, respectively. On February 7, 2017, the Company, through a foreign subsidiary, issued a promissory note due February 7, 2024 in the amount of £8.4 million to a foreign subsidiary of IAC that is not part of the HomeAdvisor business. The proceeds were used to finance the acquisition of HomeStars. The promissory note bore interest at 6.875% per annum. On August 29, 2013, the Company, through a foreign subsidiary, issued a promissory note due August 29, 2018 in the amount of $5.0 million to a foreign subsidiary of IAC that is not part of the HomeAdvisor business. The proceeds were used to repay certain indebtedness. The promissory note bore interest at LIBOR plus 2.00% . Interest expense related to the long-term debt is included in “Interest expense—related party” in the accompanying consolidated and combined statement of operations. Intercompany Loans entered into in Connection with the Combination On September 29, 2017, the Company and IAC entered into two intercompany notes (collectively referred to as "Intercompany Notes") as follows: (i) a Payoff Intercompany Note, which provided the funds necessary to repay the outstanding balance under Angie's List's existing credit agreement, totaling $61.5 million ; and (ii) a Working Capital Intercompany Note, which provided ANGI Homeservices with $15 million for working capital purposes. These Intercompany Notes were repaid on November 1, 2017 with a portion of the proceeds from the Term Loan that were received on the same date. See " Note 7—Long-term Debt " for additional information. Additionally, immediately prior to the Combination, the Company, through a foreign subsidiary, sold a promissory note due December 31, 2020 in the amount of €2.4 million ( $2.8 million at December 31, 2017 ) to a foreign subsidiary of IAC that is not part of the HomeAdvisor business. Relationship with IAC following the Combination In connection with the Combination, ANGI Homeservices and IAC entered into certain agreements to govern our relationship following the Combination. These agreements include: a contribution agreement; an investor rights agreement; a services agreement; a tax sharing agreement; and an employee matters agreement. Contribution Agreement The contribution agreement sets forth the agreements between the Company and IAC regarding the principal transactions necessary for IAC to separate the HomeAdvisor business from IAC's other businesses and to cause the HomeAdvisor business to be transferred to ANGI Homeservices prior to the Combination, as well as governs certain aspects of our relationship following the Combination. Under the contribution agreement, the Company agreed to assume all of the assets and liabilities related to the HomeAdvisor business and agreed to indemnify IAC against any losses arising out of any breach by the Company of the contribution agreement or the other transaction related agreements described below. IAC also agreed to indemnify the Company against losses arising out of any breach by IAC of the contribution agreement or any of the other transaction related agreements described below. Investor Rights Agreement The investor rights agreement provides IAC with certain registration, preemptive and governance rights related to us and the shares of our capital stock it holds, as well as certain governance rights for the benefit of stockholders other than IAC. Services Agreement The services agreement governs services that IAC provides to the Company including, among others: (i) assistance with certain legal, M&A, human resources, finance, risk management, internal audit and treasury functions, health and welfare benefits, information security services and insurance and tax affairs, including assistance with certain public company and unclaimed property reporting obligations; (ii) accounting, controllership and payroll processing services; (iii) investor relations services; (iv) tax compliance services; and (v) such other services as to which IAC and the Company may agree. The services agreement has an initial term of one year from the date of the Combination, and will automatically renew for additional one -year periods thereafter for so long as IAC continues to own a majority of the outstanding shares of the Company's common stock. Tax Sharing Agreement The tax sharing agreement governs the rights, responsibilities, and obligations of the Company and IAC with respect to tax liabilities and benefits, entitlements to refunds, preparation of tax returns, tax contests and other tax matters regarding U.S. federal, state, local and foreign income taxes. Under the tax sharing agreement, the Company is generally responsible and required to indemnify IAC for: (i) all taxes imposed with respect to any consolidated, combined or unitary tax return of IAC or its subsidiaries that includes the Company or any of its subsidiaries to the extent attributable to the Company or any of its subsidiaries, as determined under the tax sharing agreement, and (ii) all taxes imposed with respect to any of the Company's or its subsidiaries’ consolidated, combined, unitary or separate tax returns. Employee Matters Agreement The employee matters agreement addresses certain compensation and benefit issues related to the allocation of liabilities associated with: (i) employment or termination of employment, (ii) employee benefit plans and (iii) equity awards. Under the employee matters agreement, the Company's employees participate in IAC’s U.S. health and welfare plans, 401(k) plan and flexible benefits plan and the Company reimburses IAC for the costs of such participation. In the event IAC no longer retains shares representing at least 80% of the aggregate voting power of shares entitled to vote in the election of the Company’s Board of Directors, ANGI Homeservices will no longer participate in IAC’s employee benefit plans, but will establish its own employee benefit plans that will be substantially similar to the plans sponsored by IAC prior to the Combination. In addition, the employee matters agreement requires the Company to reimburse IAC for the cost of any IAC equity awards held by ANGI Homeservices current and former employees, with IAC electing to receive payment in cash or shares of our Class B common stock. This agreement also provides that IAC may require stock appreciation rights granted prior to the closing of the Combination and equity awards in our subsidiaries to be settled in either shares of our Class A common stock or IAC common stock. To the extent shares of IAC common stock are issued in settlement of these awards, the Company is obligated to reimburse IAC for the cost of those shares by issuing shares of our Class A common stock in the case of stock appreciation rights granted prior to the closing of the Combination and shares of our Class B common stock in the case of equity awards in our subsidiaries. For the period subsequent to the Combination through December 31, 2017 , 0.4 million shares of ANGI Homeservices Class B common stock were issued to IAC pursuant to the employee matters agreement as reimbursement for shares of IAC common stock issued in connection with the exercise and vesting of IAC equity awards held by ANGI Homeservices employees. For the period subsequent to the Combination through December 31, 2017 , the Company was charged $1.7 million by IAC for services rendered pursuant to the services agreement. The amount outstanding at December 31, 2017 to IAC pursuant to the services agreement is $0.4 million . In addition, the Company has an outstanding payable due to IAC of $2.0 million at December 31, 2017 related primarily to transaction related costs incurred in connection with the Combination. Long-term debt—related party for periods prior and subsequent to the Combination Long-term debt—related party consists of: December 31, 2017 2016 (In thousands) Promissory note due October 14, 2023 $ — $ 42,000 Promissory note due August 29, 2018 — 5,000 Other 2,813 2,838 Total long-term debt—related party 2,813 49,838 Less: Current portion of long-term debt—related party 816 2,838 Total long-term debt—related party, net $ 1,997 $ 47,000 Long-term debt—related party maturities: Years Ending December 31, (In thousands) 2018 $ 816 2019 1,495 2020 502 Total long-term debt—related party $ 2,813 |
BENEFIT PLANS
BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
BENEFIT PLANS | BENEFIT PLANS HomeAdvisor HomeAdvisor employees in the United States are eligible to participate in a retirement savings plan sponsored by IAC, which is qualified under Section 401(k) of the Internal Revenue Code. Under the IAC/InterActiveCorp Retirement Savings Plan (the "IAC Plan"), participating employees may contribute up to 50% of their pre-tax earnings, but not more than statutory limits. The employer match under the IAC Plan is fifty cents for each dollar a participant contributes in the IAC Plan, with a maximum contribution of 3% of a participant's eligible earnings. Matching contributions under the IAC Plan for the years ended December 31, 2017 , 2016 and 2015 were $3.5 million , $2.7 million and $1.9 million , respectively. Matching contributions are invested in the same manner as each participant’s voluntary contributions in the investment options provided under the IAC Plan. An investment option in the IAC Plan is IAC common stock, but neither participant nor matching contributions are required to be invested in IAC common stock. The increase in matching contributions in 2017 and 2016 was due primarily to an increase in participation in the Plan due to increased headcount as a result of business growth. Internationally, HomeAdvisor also has or participates in various benefit plans, primarily defined contribution plans. The Company's contributions for these plans for the years ended December 31, 2017 , 2016 and 2015 were $0.3 million , $0.1 million , and $0.2 million , respectively. The increase in the Company's contributions in 2017 was due primarily to an increase in participation in the Plan due to increased headcount as a result of business growth and acquisitions. Angie's List Angie's List sponsors a 401(k) profit-sharing plan (the "Angie's List Plan") covering substantially all of its employees. Contributions to the Angie's List Plan are discretionary. Angie's List contributes 3% of gross pay for all eligible employees. Matching contributions under the Angie's List Plan, subsequent to the Combination through the year ended December 31, 2017 , was $0.6 million . The Angie's List Plan was merged into the IAC Plan effective January 1, 2018. |
CONSOLIDATED AND COMBINED FINAN
CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS | CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS December 31, 2017 2016 (In thousands) Other current assets: Prepaid expenses $ 10,937 $ 6,456 Other 1,835 2,283 Other current assets $ 12,772 $ 8,739 December 31, 2017 2016 (In thousands) Property and equipment, net of accumulated depreciation and amortization: Computer equipment and capitalized software $ 41,853 $ 27,309 Buildings and leasehold improvements 13,984 6,075 Furniture and other equipment 6,222 3,140 Projects in progress 12,801 5,198 Land 2,800 — 77,660 41,722 Accumulated depreciation and amortization (24,368 ) (18,077 ) Property and equipment, net of accumulated depreciation and amortization $ 53,292 $ 23,645 December 31, 2017 2016 (In thousands) Accrued expenses and other current liabilities: Accrued employee compensation and benefits $ 30,354 $ 14,379 Accrued advertising expense 17,243 8,209 Other 27,574 11,850 Accrued expenses and other current liabilities $ 75,171 $ 34,438 Years Ended December 31, 2017 2016 2015 (In thousands) Other income (expense), net $ 1,974 $ (699 ) $ (398 ) Other income, net in 2017 includes net foreign currency exchange gains of $0.9 million , related party interest income of $0.7 million and third party interest income of $0.5 million . Other expense, net in 2016 and 2015 principally includes net foreign currency exchange losses. |
TRANSACTION AND INTEGRATION REL
TRANSACTION AND INTEGRATION RELATED COSTS IN CONNECTION WITH THE COMBINATION | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
TRANSACTION AND INTEGRATION RELATED COSTS IN CONNECTION WITH THE COMBINATION | BUSINESS COMBINATIONS Angie's List Combination Through the Combination, the Company acquired 100% of the common stock of Angie's List on September 29, 2017 for a total purchase price valued at $781.4 million . The purchase price of $781.4 million was determined based on the sum of (i) the fair value of the 61.3 million shares of Angie's List common stock outstanding immediately prior to the Combination based on the closing stock price of Angie's List common stock on the NASDAQ on September 29, 2017 of $12.46 per share; (ii) the cash consideration of $1.9 million paid to holders of Angie's List common stock who elected to receive $8.50 in cash per share; and (iii) the fair value of vested equity awards (including the pro rata portion of unvested awards attributable to pre-combination services) outstanding under Angie's List stock plans on September 29, 2017 . Each stock option to purchase shares of Angie's List common stock that was outstanding immediately prior to the effective time of the Combination was, as of the effective time of the Combination, converted into an option to purchase (i) that number of Class A shares of ANGI Homeservices equal to the total number of shares of Angie's List common stock subject to such Angie's List option immediately prior to the effective time of the Combination, (ii) at a per-share exercise price equal to the exercise price per share of Angie's List common stock at which such Angie's List option was exercisable immediately prior to the effective time of the Combination. Each award of Angie's List restricted stock units that was outstanding immediately prior to the effective time of the Combination was, as of the effective time of the Combination, converted into an ANGI Homeservices restricted stock unit award with respect to a number of Class A shares of ANGI Homeservices equal to the total number of shares of Angie's List common stock subject to such Angie's List restricted stock unit award immediately prior to the effective time of the Combination. The table below summarizes the purchase price: Angie's List (In thousands) Class A common stock $ 763,684 Cash consideration for holders who elected to receive $8.50 in cash per share of Angie's List common stock 1,913 Fair value of vested and pro rata portion of unvested stock options attributable to pre-combination services 11,749 Fair value of the pro rata portion of unvested restricted stock units attributable to pre-combination services 4,038 Total purchase price $ 781,384 The financial results of Angie's List are included in the Company's consolidated and combined financial statements, within the North America segment, beginning September 29, 2017 . For the year ended December 31, 2017 , the Company included $58.9 million of revenue and $21.7 million of net loss in its consolidated and combined statement of operations related to Angie's List. The net loss of Angie's List reflects $28.7 million in stock-based compensation expense related to (i) the acceleration of previously issued Angie's List equity awards held by employees terminated in connection with the Combination and (ii) the expense related to previously issued Angie's List equity awards, severance and retention costs of $19.8 million related to the Combination and a reduction in revenue of $7.8 million due to the write-off of deferred revenue related to the Combination. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of combination: Angie's List (In thousands) Cash and cash equivalents $ 44,270 Other current assets 11,280 Property and equipment 16,341 Goodwill 545,204 Intangible assets 317,300 Total assets 934,395 Deferred revenue (32,595 ) Other current liabilities (46,150 ) Long-term debt - related party (61,498 ) Deferred income taxes (11,363 ) Other long-term liabilities (1,405 ) Net assets acquired $ 781,384 The purchase price was based on the expected financial performance of Angie's List, not on the value of the net identifiable assets at the time of combination. This resulted in a significant portion of the purchase price being attributed to goodwill because Angie's List is complementary and synergistic to the other North America businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of combination are as follows: Angie's List (In thousands) Weighted-average useful life (years) Indefinite-lived trade name and trademarks $ 137,000 Indefinite Service professionals 90,500 3 Developed technology 63,900 6 Memberships 15,900 3 User base 10,000 1 Total identifiable intangible assets acquired $ 317,300 Other current assets, current liabilities and other long-term liabilities of Angie's List were reviewed and adjusted to their fair values at the date of combination, as necessary. The fair value of deferred revenue was determined using an income approach that utilized a cost to fulfill analysis. The fair value of the trade name and trademarks was determined using an income approach that utilized the relief from royalty methodology. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The fair values of the service professionals and memberships were determined using an income approach that utilized the excess earnings methodology. The valuations of deferred revenue and intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows, cost and profit margins related to deferred revenue and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. HomeStars Acquisition The Company acquired a 90% voting interest in HomeStars Inc. ("HomeStars"), a leading home services platform in Canada, on February 8, 2017. The purchase price for HomeStars was $16.6 CAD million (or $12.7 million ) in cash and is net of a $0.3 CAD million (or $0.2 million ) working capital adjustment paid in full to the Company in the third quarter of 2017. In connection with the acquisition, the Company measured and recorded the acquisition date fair value of the 10% noncontrolling interest in HomeStars, which totaled $1.9 CAD million (or $1.4 million ). The determination of the fair value of noncontrolling interest was calculated using the implied value of 100% of the enterprise value of the business using the purchase price. The financial results of HomeStars are included in the Company's consolidated and combined financial statements, within the North America segment, beginning February 8, 2017. For the year ended December 31, 2017 , the Company included $6.5 million of revenue and $1.2 million of net loss in its consolidated and combined statement of operations related to HomeStars. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: HomeStars (In thousands) Cash and cash equivalents $ 181 Other current assets 165 Goodwill 9,841 Intangible assets 6,414 Total assets 16,601 Current liabilities (649 ) Other long-term liabilities (1,873 ) Net assets acquired $ 14,079 The purchase price was based on the expected financial performance of HomeStars, not on the value of the net identifiable assets at the time of acquisition. This resulted in a significant portion of the purchase price being attributed to goodwill because HomeStars is complementary and synergistic to the other North America businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: HomeStars (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 2,358 Indefinite Contractor relationships 2,435 2 Developed technology 1,522 2 User base 99 1 Total identifiable intangible assets acquired $ 6,414 Other current assets, current liabilities and other long-term liabilities of HomeStars were reviewed and adjusted to their fair values at the date of acquisition, as necessary. The fair values of the trade name and contractor relationships were determined using variations of the income approach; specifically, in respective order, the relief from royalty and excess earnings methodologies. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The valuations of the intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. MyBuilder Acquisition The Company acquired a 75% voting interest in MyBuilder Limited ("MyBuilder"), a leading home services platform in the United Kingdom, on March 24, 2017. The purchase price was £32.6 million (or $40.7 million ) in cash and includes a £0.6 million (or $0.8 million ) working capital adjustment paid in full by the Company in the third quarter of 2017. In connection with the acquisition, the Company measured and recorded the acquisition date fair value of the 25% noncontrolling interest in MyBuilder, which totaled £10.7 million (or $13.3 million ). The determination of the fair value of noncontrolling interest was calculated using the implied value of 100% of the enterprise value of the business using the purchase price. The financial results of MyBuilder are included in the Company's consolidated and combined financial statements, within the Europe segment, beginning April 1, 2017. For the year ended December 31, 2017 , the Company included $8.0 million of revenue and $1.4 million of net loss in its consolidated and combined statement of operations related to MyBuilder. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: MyBuilder (In thousands) Cash and cash equivalents $ 6,004 Other current assets 344 Goodwill 37,072 Intangible assets 15,239 Total assets 58,659 Current liabilities (2,065 ) Other long-term liabilities (2,595 ) Net assets acquired $ 53,999 The purchase price was based on the expected financial performance of MyBuilder, not on the value of the net identifiable assets at the time of acquisition. This resulted in a significant portion of the purchase price being attributed to goodwill because MyBuilder is complementary and synergistic to the other European businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: MyBuilder (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 7,994 Indefinite Contractor relationships 4,122 2 Developed technology 1,499 2 User base 1,624 1 Total identifiable intangible assets acquired $ 15,239 Other current assets, current liabilities and other long-term liabilities of MyBuilder were reviewed and adjusted to their fair values at the date of acquisition, as necessary. The fair values of the trade name and contractor relationships were determined using variations of the income approach; specifically, in respective order, the relief from royalty and excess earnings methodologies. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The valuations of the intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. MyHammer Acquisition On November 3, 2016, the Company acquired a 70% voting interest in MyHammer Holding AG ("MyHammer"), the leading home services marketplace in Germany. The purchase price was €17.7 million (or $19.7 million ). In connection with the acquisition, the Company measured and recorded the acquisition date fair value of the 30% noncontrolling interest in MyHammer, which totaled €9.4 million (or $10.4 million ). The determination of the fair value of noncontrolling interest was calculated using the MyHammer share price on the acquisition date. In 2017 , the Company increased its ownership stake in MyHammer to 81.1% . The financial results of MyHammer are included in the Company's consolidated and combined financial statements, within the Europe segment, with effect from the date of acquisition. For the years ended December 31, 2017 and 2016 , the Company included $12.7 million and $1.3 million of revenue, respectively, and less than $0.1 million and $(0.4) million of net income (loss), respectively, in its consolidated and combined statement of operations related to MyHammer. The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: MyHammer (In thousands) Cash and cash equivalents $ 4,041 Other current assets 790 Goodwill 22,277 Intangible assets 8,107 Total assets 35,215 Current liabilities (2,642 ) Other long-term liabilities (2,447 ) Net assets acquired $ 30,126 The purchase price was based on the expected financial performance of MyHammer, not on the value of the net identifiable assets at the time of acquisition. This resulted in a significant portion of the purchase price being attributed to goodwill because MyHammer is complementary and synergistic to the other European businesses of ANGI Homeservices. The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: MyHammer (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 4,553 Indefinite Contractor relationships 1,444 4 Developed technology 1,222 3 User base 888 1 Total identifiable intangible assets acquired $ 8,107 Other current assets, current liabilities and other long-term liabilities of MyHammer were reviewed and adjusted to their fair values at the date of acquisition, as necessary. The fair values of the trade name and contractor relationships were determined using variations of the income approach; specifically, in respective order, the relief from royalty and excess earnings methodologies. The fair values of developed technology and user base were determined using a cost approach that utilized the cost to replace methodology. The valuations of the intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows and the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible. Unaudited pro forma financial information The unaudited pro forma financial information in the table below presents the combined results of the Company and Angie's List, HomeStars, MyBuilder and MyHammer as if these acquisitions had occurred on January 1, 2016. The unaudited pro forma financial information includes adjustments required under the acquisition method of accounting and is presented for informational purposes only and is not necessarily indicative of the results that would have been achieved had the acquisitions actually occurred on January 1, 2016. For the year ended December 31, 2017 , pro forma adjustments include (i) reductions in stock-based compensation expense of $96.9 million and transaction related costs of $35.2 million because they are one-time in nature and will not have a continuing impact on operations; and (ii) an increase in amortization of intangibles of $31.2 million . The stock-based compensation expense is primarily related to the modification of previously issued HomeAdvisor vested equity awards, which were converted into ANGI Homeservices' equity awards, and the acceleration of previously issued Angie's List equity awards held by employees terminated in connection with the Combination. The transaction related costs include severance and retention costs of $19.8 million related to the Combination. For the year ended December 31, 2016 , pro forma adjustments include a reduction in revenue of $35.0 million due to the write-offs of deferred revenue at the assumed date of acquisition as well as increases in stock-based compensation expense of $81.7 million and amortization of intangibles of $64.0 million . Years Ended December 31, 2017 2016 (In thousands, except per share data) Revenue $ 962,597 $ 809,999 Net loss attributable to ANGI Homeservices Inc. shareholders $ (36,459 ) $ (86,557 ) Basic and diluted loss per share attributable to ANGI Homeservices Inc. shareholders $ (0.08 ) $ (0.21 ) TRANSACTION AND INTEGRATION RELATED COSTS IN CONNECTION WITH THE COMBINATION During the year ended December 31, 2017 , the Company incurred $44.1 million in costs related to the Combination (including severance, retention, transaction and integration related costs) as well as deferred revenue write-offs of $7.8 million . The Company also incurred $122.1 million in stock-based compensation expense during 2017 related to the modification of previously issued HomeAdvisor vested and unvested equity awards, which were converted into ANGI Homeservices' equity awards, the expense related to previously issued Angie's List equity awards and the acceleration of certain Angie's List equity awards resulting from the termination of employees in connection with the Combination. See " Note 4—Business Combinations " for additional information on the Combination. A summary of the costs incurred, payments made and the related accrual at December 31, 2017 is presented below. Year Ended December 31, 2017 (In thousands) Transaction and integration related costs $ 44,101 Stock-based compensation expense 122,066 Total $ 166,167 December 31, 2017 (In thousands) Charges incurred $ 44,101 Payments made (35,621 ) Accrual as of December 31 $ 8,480 The costs are allocated as follows in the accompanying consolidated and combined statement of operations: Year Ended December 31, 2017 Transaction and Integration Related Costs Stock-based Compensation Expense Total (In thousands) Cost of revenue $ — $ — $ — Selling and marketing expense 7,430 24,416 31,846 General and administrative expense 36,120 83,420 119,540 Product development expense 551 14,230 14,781 Total $ 44,101 $ 122,066 $ 166,167 |
QUARTERLY RESULTS (UNAUDITED)
QUARTERLY RESULTS (UNAUDITED) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY RESULTS (UNAUDITED) | QUARTERLY RESULTS (UNAUDITED) Quarter Ended March 31 Quarter Ended June 30 Quarter Ended September 30 (a) Quarter Ended December 31 (b) (In thousands, except per share data) Year Ended December 31, 2017 Revenue $ 150,745 $ 180,711 $ 181,717 $ 223,213 Cost of revenue 6,830 7,562 7,999 11,682 Operating income (loss) 1,388 (2,836 ) (112,505 ) (33,918 ) Net earnings (loss) 25,887 (25 ) (72,158 ) (58,231 ) Net earnings (loss) attributable to ANGI Homeservices Inc. shareholders 26,613 254 (71,761 ) (58,224 ) Per share information attributable to ANGI Homeservices Inc. shareholders: Basic earnings (loss) per share (c) $ 0.06 $ 0.00 $ (0.17 ) $ (0.12 ) Diluted earnings (loss) per share (c) $ 0.06 $ 0.00 $ (0.17 ) $ (0.12 ) Quarter Ended March 31 Quarter Ended June 30 Quarter Ended September 30 Quarter Ended December 31 (In thousands, except per share data) Year Ended December 31, 2016 Revenue $ 111,489 $ 130,173 $ 133,560 $ 123,668 Cost of revenue 5,994 6,745 6,826 6,293 Operating (loss) income (514 ) 9,513 8,843 6,216 Net (loss) earnings (1,244 ) 5,351 4,468 2,056 Net (loss) earnings attributable to ANGI Homeservices Inc. shareholders (677 ) 6,010 5,075 2,720 Per share information attributable to ANGI Homeservices Inc. shareholders: Basic (loss) earnings per share (c) $ (0.00 ) $ 0.01 $ 0.01 $ 0.01 Diluted (loss) earnings per share (c) $ (0.00 ) $ 0.01 $ 0.01 $ 0.01 _________________________________________________________________________ (a) The third quarter of 2017 includes after-tax stock-based compensation expense of $59.4 million related primarily to the modification of previously issued HomeAdvisor vested awards, which were converted into ANGI Homeservices equity awards, and the acceleration of certain Angie’s List equity awards in connection with the Combination, as well as after-tax costs of $17.0 million related to the Combination. (b) The fourth quarter of 2017 includes after-tax stock-based compensation expense of $15.6 million related primarily to the modification of previously issued HomeAdvisor unvested awards, which were converted into ANGI Homeservices equity awards, the expense related to previously issued Angie's List equity awards and the acceleration of certain Angie's List equity awards resulting from the termination of employees in connection with the Combination, as well as after-tax costs of $13.8 million related to the Combination (including $7.6 million of deferred revenue write-offs). (c) Quarterly per share amounts may not add to the related annual per share amount because of differences in the average common shares outstanding during each period. |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2017 | |
Valuation and Qualifying Accounts [Abstract] | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | Schedule II ANGI HOMESERVICES INC. AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS Description Balance at Beginning of Period Charges to Earnings Charges to Other Accounts Deductions Balance at End of Period (In thousands) 2017 Allowance for doubtful accounts and revenue reserves $ 9,177 $ 27,514 (a) $ 271 $ (27,699 ) (b) $ 9,263 Deferred tax valuation allowance 14,180 42,310 (c) 5,073 (d) — 61,563 2016 Allowance for doubtful accounts and revenue reserves $ 8,171 $ 17,425 (a) $ (56 ) $ (16,363 ) (b) $ 9,177 Deferred tax valuation allowance 12,696 2,384 (e) (900 ) (f) — 14,180 2015 Allowance for doubtful accounts and revenue reserves $ 6,861 $ 13,234 (a) $ (453 ) $ (11,471 ) (b) $ 8,171 Deferred tax valuation allowance 11,249 2,248 (e) (801 ) (f) — 12,696 _________________________________________________________ (a) Additions to the allowance for doubtful accounts are charged to expense. Additions to the revenue reserves are charged against revenue. (b) Write-off of fully reserved accounts receivable. The Company writes off accounts receivable when they are deemed uncollectible, primarily once 180 days past due. (c) Amount is primarily due to the establishment of foreign NOLs related to a recent acquisition. (d) Amount is related to acquired state NOLs and currency translation adjustments on foreign NOLs. (e) Amount is primarily related to federal and foreign NOLs. (f) Amount is related to currency translation adjustments on foreign NOLs. |
SUMMARY OF SIGNIFICANT ACCOUN29
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of presentation and consolidation | Basis of presentation and consolidation The Company prepares its consolidated and combined financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company's financial statements were prepared on a consolidated basis beginning September 29, 2017 and on a combined basis for periods prior thereto. The difference in presentation is due to the fact that the final steps of the legal reorganization through which IAC contributed the HomeAdvisor business and cash to fund the cash consideration paid in the Combination to ANGI Homeservices Inc. were not completed, as planned, until immediately prior to September 29, 2017 . The preparation of the financial statements on a combined basis for periods prior thereto allows for the financial statements to be presented on a consistent basis for all periods presented. The combined financial statements have been prepared on a standalone basis and are derived from the historical consolidated financial statements and accounting records of IAC through September 29, 2017 . The combined financial statements reflect the historical financial position, results of operations and cash flows of the businesses comprising the HomeAdvisor business since their respective dates of acquisition by IAC. The consolidated financial statements include the accounts of the Company, all entities that are wholly-owned by the Company and all entities in which the Company has a controlling financial interest. The consolidated and combined financial statements reflect the allocation to ANGI Homeservices of certain IAC corporate expenses relating to the HomeAdvisor business based on the historical consolidated financial statements and accounting records of IAC through September 29, 2017 . For the purpose of these financial statements, income taxes have been computed as if ANGI Homeservices filed on a standalone, separate tax return basis. All intercompany transactions and balances between and among the Company and its subsidiaries have been eliminated. All intercompany transactions between (i) ANGI Homeservices and (ii) IAC and its subsidiaries, with the exception of notes payable due to IAC and its subsidiaries, are considered to be effectively settled for cash at the time the transaction is recorded. The notes payable due to IAC and its subsidiaries are included in “Long-term debt—related party” in the accompanying consolidated and combined balance sheet. See " Note 15—Related Party Transactions " for additional information on transactions between ANGI Homeservices and IAC. In the opinion of management, the assumptions underlying the historical consolidated and combined financial statements, including the basis on which the expenses have been allocated from IAC, are reasonable. However, the allocations may not reflect the expenses that we may have incurred as a standalone public company for the periods presented. |
Accounting estimates | Accounting estimates Management of the Company is required to make certain estimates, judgments and assumptions during the preparation of its consolidated and combined financial statements in accordance with GAAP. These estimates, judgments and assumptions impact the reported amounts of assets, liabilities, revenue and expenses and the related disclosure of contingent assets and liabilities. Actual results could differ from these estimates. On an ongoing basis, the Company evaluates its estimates and judgments including those related to: the recoverability of goodwill and indefinite-lived intangible assets; the useful lives and recoverability of definite-lived intangible assets and property and equipment; the carrying value of accounts receivable, including the determination of the allowance for doubtful accounts; the determination of revenue reserves; the liabilities for uncertain tax positions; the valuation allowance for deferred income tax assets; and the fair value of and forfeiture rates for stock-based awards, among others. The Company bases its estimates and judgments on historical experience, its forecasts and budgets and other factors that the Company considers relevant. |
Revenue recognition | Revenue recognition The Company recognizes revenue when persuasive evidence of an arrangement exists, services are rendered to customers, the fee or price charged is fixed or determinable and collectability is reasonably assured. Deferred revenue is recorded when payments are received, or contractually due, in advance of services or advertising to be provided. Deferred revenue is recognized as revenue when the related services or advertising are actually provided. Marketplace Revenue is primarily derived from (i) consumer connection revenue, which includes fees paid by service professionals for consumer matches (regardless of whether the professional ultimately provides the requested service), and (ii) membership subscription fees paid by service professionals. Consumer connection revenue varies based upon several factors, including the service requested, type of match (such as Instant Booking, Instant Connect, Same Day Service or Next Day Service) and geographic location of service. The Company’s consumer connection revenue is generated and recognized when an in-network service professional is delivered a consumer match. Membership subscription revenue is generated through subscription sales to service professionals and is deferred and recognized over the term of the applicable membership. Membership agreements can be one month, three months, or one year. Effective with the Combination, revenue is also derived from Angie's List (i) sales of time-based advertising to service professionals and (ii) membership subscription fees from consumers. Angie's List service professionals generally pay for advertisements in advance on a monthly or annual basis at the option of the service professional, with the average advertising contract term being approximately one year. These contracts include an early termination penalty. Angie's List revenue from the sale of website, mobile and call center advertising is recognized ratably over the period during which the advertisements run. Revenue from the sale of advertising in the Angie’s List Magazine is recognized in the period in which the publication is published and distributed. Angie's List prepaid consumer membership subscription fees are recognized as revenue ratably over the term of the associated subscription, which is typically one year. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents include cash and short-term investments, with maturities of less than 91 days from the date of purchase. Domestically, cash equivalents consist of AAA rated government money market funds, certificates of deposit and treasury discount notes. |
Accounts receivable, net of allowance for doubtful accounts and revenue reserves | Accounts receivable, net of allowance for doubtful accounts and revenue reserves Accounts receivable are stated at amounts due from customers, net of an allowance for doubtful accounts and revenue reserves. Accounts receivable outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time accounts receivable are past due, the Company’s previous loss history and the specific customer’s ability to pay its obligation to the Company. The Company writes off accounts receivable when they become uncollectible. The Company also maintains allowances to reserve for potential credits issued to customers or other revenue adjustments. The amounts of these reserves are based, in part, on historical experience. |
Property and equipment | Property and equipment Property and equipment, including significant improvements, are recorded at cost. Repairs and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, or, in the case of leasehold improvements, the lease term, if shorter. Asset Category Estimated Useful Lives Computer equipment and capitalized software 2 to 3 Years Furniture and other equipment 5 to 7 Years Buildings and leasehold improvements 5 to 25 Years The Company capitalizes certain internal use software costs including external direct costs utilized in developing or obtaining the software and compensation for personnel directly associated with the development of the software. Capitalization of such costs begins when the preliminary project stage is complete and ceases when the project is substantially complete and ready for its intended purpose. |
Business combinations | Business combinations The purchase price of each acquisition is attributed to the assets acquired and liabilities assumed based on their fair values at the date of acquisition, including identifiable intangible assets that either arise from a contractual or legal right or are separable from goodwill. The fair value of these intangible assets is based on detailed valuations that use information and assumptions provided by management. The excess purchase price over the net tangible and identifiable intangible assets is recorded as goodwill and is assigned to the reporting unit(s) that is expected to benefit from the combination as of the acquisition date. |
Goodwill and indefinite-lived intangible assets | Goodwill and indefinite-lived intangible assets The Company assesses goodwill and indefinite-lived intangible assets for impairment annually as of October 1, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit or the fair value of an indefinite-lived intangible asset below its carrying value. At October 1, 2017, the Company has two reporting units: North America and Europe. When the Company elects to perform a qualitative assessment and concludes it is not more likely than not that the fair value of the reporting unit is less than its carrying value, no further assessment of that reporting unit’s goodwill is necessary; otherwise, a quantitative assessment is performed and the fair value of the reporting unit is determined. If the carrying value of the reporting unit exceeds its fair value an impairment loss equal to the excess is recorded. For the Company’s annual goodwill test at October 1, 2017, a qualitative assessment of the North America and Europe reporting units’ goodwill was performed because the Company concluded it was more likely than not that the fair value of these reporting units was in excess of their respective carrying values. In the aggregate, ANGI Homeservices' October 1, 2017 market capitalization of $5.9 billion exceeded its carrying value by more than 450% . The primary factor that the Company considered in its qualitative assessment for its Europe reporting unit was a valuation performed during September 2017, which was prepared primarily in connection with IAC's contribution of HomeAdvisor International into ANGI Homeservices immediately prior to the Combination. The valuation was prepared time proximate to, but not as of, October 1, 2017. The fair value from the September 2017 valuation exceeds the carrying value of the Europe reporting unit by 60% . The primary factors that the Company considered in its qualitative assessment for its North America reporting unit were the strong operating performance of the North America reporting unit and the significant excess of the estimated fair value of the North America reporting unit over its carrying value. The fair value of the North America reporting unit was estimated by subtracting the fair value of the Europe reporting unit, from the September 2017 valuation described above, from the October 1, 2017 market capitalization of the Company; the estimated fair value of the North America reporting unit exceeded its carrying value by approximately 500% . While the Company has the option to qualitatively assess whether it is more likely than not that the fair values of its indefinite-lived intangible assets are less than their carrying values, the Company’s policy is to determine the fair value of each of its indefinite-lived intangible assets annually as of October 1. In 2017, the Company did not quantitatively assess the Angie's List indefinite-lived intangible assets acquired through the Combination given the proximity of the September 29, 2017 transaction date to the October 1, 2017 annual test date. The Company determines the fair value of indefinite-lived intangible assets using an avoided royalty discounted cash flow (“DCF”) valuation analysis. Significant judgments inherent in this analysis include the selection of appropriate royalty and discount rates and estimating the amount and timing of expected future cash flows. The discount rates used in the DCF analyses are intended to reflect the risks inherent in the expected future cash flows generated by the respective intangible assets. The royalty rates used in the DCF analyses are based upon an estimate of the royalty rates that a market participant would pay to license the Company’s trade names and trademarks. Assumptions used in the avoided royalty DCF analyses, including the discount rate and royalty rate, are assessed annually based on the actual and projected cash flows related to the asset, as well as macroeconomic and industry specific factors. |
Long-lived assets and intangible assets with definite lives | Long-lived assets and intangible assets with definite lives Long-lived assets, which consist of property and equipment and intangible assets with definite lives, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The carrying value of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value is deemed not to be recoverable, an impairment loss is recorded equal to the amount by which the carrying value of the long-lived asset exceeds its fair value. Amortization of definite-lived intangible assets is computed either on a straight-line basis or based on the pattern in which the economic benefits of the asset will be realized. |
Fair value measurements | Fair value measurements The Company categorizes its financial instruments measured at fair value into a fair value hierarchy that prioritizes the inputs used in pricing the asset or liability. The three levels of the fair value hierarchy are: • Level 1: Observable inputs obtained from independent sources, such as quoted prices for identical assets and liabilities in active markets. • Level 2: Other inputs, which are observable directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data. The fair values of the Company's Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may not be actively traded. Certain of these securities may have different market prices from multiple market data sources, in which case an average market price is used. • Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities. The Company’s non-financial assets, such as goodwill, intangible assets and property and equipment are adjusted to fair value only when an impairment charge is recognized. Such fair value measurements are based predominantly on Level 3 inputs. |
Advertising costs | Advertising costs Advertising costs are expensed in the period incurred (when the advertisement first runs for production costs that are initially capitalized) and represent online marketing, including fees paid to search engines, offline marketing, which is primarily television advertising and partner-related payments to those who direct traffic to our platforms. |
Legal costs | Legal costs Legal costs are expensed as incurred. |
Income taxes | Income taxes ANGI Homeservices is included within IAC's tax group for purposes of federal and consolidated state income tax return filings. In all periods presented, current and deferred income taxes have been computed for ANGI Homeservices on an as if standalone, separate return basis. The Company’s payments to IAC for its share of IAC’s consolidated federal and state income tax return liabilities have been reflected within cash flows from operating activities in the accompanying consolidated and combined statement of cash flows. The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided on deferred tax assets if it is determined that it is more likely than not that the deferred tax asset will not be realized. The Company records interest, net of any applicable related income tax benefit, on potential income tax contingencies as a component of income tax expense. The Company evaluates and accounts for uncertain tax positions using a two-step approach. Recognition (step one) occurs when the Company concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustainable upon examination. Measurement (step two) determines the amount of benefit that is greater than 50% likely to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. De-recognition of a tax position that was previously recognized would occur when the Company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act imposes a new minimum tax on global intangible low-taxed income (“GILTI”) earned by foreign subsidiaries beginning in 2018. The Financial Accounting Standards Board ("FASB") Staff Q&A, Topic 740 No. 5, Accounting for Global Intangible Low-Taxed Income , states that an entity can make an accounting policy election to either recognize deferred taxes for temporary differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred. The Company intends to elect to recognize the tax on GILTI as a period expense in the period the tax is incurred. |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing net earnings attributable to ANGI Homeservices Inc. shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the potential dilution that could occur if stock options, stock appreciation rights and other commitments to issue common stock were exercised or equity awards vested resulting in the issuance of common stock that could share in the earnings of the Company. |
Foreign currency translation and transaction gains and losses | Foreign currency translation and transaction gains and losses The financial position and operating results of foreign entities whose primary economic environment is based on their local currency are combined using the local currency as the functional currency. These local currency assets and liabilities are translated at the rates of exchange as of the balance sheet date, and local currency revenue and expenses of these operations are translated at average rates of exchange during the period. Translation gains and losses are included in accumulated other comprehensive income as a component of shareholders’ equity. Transaction gains and losses resulting from assets and liabilities denominated in a currency other than the functional currency are included in the consolidated and combined statement of operations as a component of other income (expense), net. |
Stock-based compensation | Stock-based compensation Stock-based compensation is measured at the grant date based on the fair value of the award and is expensed over the requisite service period. |
Redeemable noncontrolling interests | Redeemable noncontrolling interests Noncontrolling interests in the subsidiaries of the Company are ordinarily reported on the consolidated and combined balance sheet within shareholders’ equity, separately from the Company’s equity. However, securities that are redeemable at the option of the holder and not solely within the control of the issuer must be classified outside of shareholders’ equity. Accordingly, all noncontrolling interests that are redeemable at the option of the holder are presented outside of shareholders’ equity in the accompanying consolidated and combined balance sheet. In connection with the acquisition of certain subsidiaries, management of these businesses has retained an ownership interest. The Company is party to fair value put and call arrangements with respect to these interests. These put and call arrangements allow management of these businesses to require the Company to purchase their interests or allow the Company to acquire such interests at fair value, respectively. The put arrangements do not meet the definition of a derivative instrument as the put agreements do not provide for net settlement. These put and call arrangements become exercisable by the Company and the counterparty at various dates. During the year ended December 31, 2017 , one of these arrangement was exercised. No put and call arrangements were exercised during 2016 or 2015 . Because these put arrangements are exercisable by the counterparty outside the control of the Company, to the extent that the fair value of these interests exceeds the value determined by normal noncontrolling interest accounting, the value of such interests is adjusted to fair value with a corresponding adjustment to additional paid-in capital or invested capital for periods subsequent to and prior to the Combination, respectively. During the years ended December 31, 2017 , 2016 and 2015 , the Company recorded adjustments of $3.3 million , $(3.1) million , and $12.2 million , respectively, to increase (decrease) these interests to fair value. Fair value determinations require high levels of judgment and are based on various valuation techniques, including market comparables and discounted cash flow projections. |
Certain risks and concentrations | Certain risks and concentrations The Company’s business is subject to certain risks and concentrations including dependence on third party technology providers, exposure to risks associated with online commerce security and credit card fraud. Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of cash and cash equivalents. Cash and cash equivalents are maintained with financial institutions and are in excess of Federal Deposit Insurance Company insurance limits. |
Recent accounting pronouncements | Recent accounting pronouncements Accounting pronouncements not yet adopted by the Company In May 2014, the FASB issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers, which clarifies the principles for recognizing revenue and develops a common standard for all industries. ASU No. 2014-09 was subsequently amended during 2015, 2016 and 2017; these amendments provide further revenue recognition guidance related to principal versus agent considerations, performance obligations and licensing, narrow-scope improvements and practical expedients. ASU No. 2014-09 is a comprehensive revenue recognition standard that will supersede nearly all existing revenue recognition guidance under GAAP. The new standard provides a single principles-based, five-step model to be applied to all contracts with customers. This five-step model includes (1) identifying the contract(s) with the customer, (2) identifying the performance obligations in the contract, (3) determining the transaction price, (4) allocating the transaction price to the performance obligations in the contract and (5) recognizing revenue when each performance obligation is satisfied. More specifically, revenue will be recognized when promised goods or services are transferred to the customer in an amount that reflects the consideration expected in exchange for those goods or services. ASU No. 2014-09 is effective for interim and annual reporting periods beginning after December 15, 2017, with early adoption permitted for interim and annual reporting periods beginning after December 15, 2016. Upon adoption, ASU No. 2014-09 may either be applied retrospectively to each prior period presented or using the modified retrospective approach with the cumulative effect recognized as of the date of initial application. The Company’s evaluation of the impact of the adoption of ASU No. 2014-09 on its consolidated and combined financial statements is substantially complete. The principal remaining work is a confirmation of the calculation of the cumulative effect of ASU No. 2014-09 as of January 1, 2018, which will be completed during the financial close process for the first quarter of 2018. The Company has adopted ASU No. 2014-09 using the modified retrospective approach effective January 1, 2018. Therefore, the cumulative effect of adoption will be reflected as an adjustment to beginning retained earnings in the Form 10-Q for the period ending March 31, 2018. The effect of the adoption of ASU No. 2014-09 on the Company is that sales commissions, which represent the incremental direct costs of obtaining a service professional contract, will be capitalized and amortized over the average life of a service professional. These costs were expensed as incurred prior to January 1, 2018. The current estimate of the cumulative effect of the adoption of ASU No. 2014-09 is the establishment of a current and non-current asset for capitalized sales commissions of approximately $30 million and $5 million , respectively, for the unamortized cost of the sales commissions paid to obtain a service professional and a related deferred tax liability of approximately $10 million , resulting in a net increase to retained earnings of $25 million on January 1, 2018. The estimated impact of ASU No. 2014-09 on the Company's consolidated and combined statement of operations, if January 1, 2017 were the date of adoption, would be a reduction in net loss of approximately $8 million . In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which supersedes pre-existing guidance on accounting for leases in "Leases (Topic 840)" and generally requires all leases to be recognized in the statement of financial position. The provisions of ASU No. 2016-02 are effective for reporting periods beginning after December 15, 2018; early adoption is permitted. The provisions of ASU No. 2016-02 are to be applied using a modified retrospective approach. The Company will adopt ASU No. 2016-02 effective January 1, 2019. The Company is not a lessor and has no capitalized leases and does not expect to enter into any capitalized leases prior to the adoption of ASU No. 2016-02. Accordingly, the Company does not expect the amount or classification of rent expense in its statement of operations to be affected by ASU No. 2016-02. The primary effect of the adoption of ASU No. 2016-02 will be the recognition of a right of use asset and related liability to reflect the Company's rights and obligations under its operating leases. The Company will also be required to provide the additional disclosures stipulated in ASU No. 2016-02. The adoption of ASU No. 2016-02 will not have an impact on the leverage calculation set forth in the Company's term loan facility because the leverage calculation is not affected by the liability that will be recorded upon adoption of the new standard. While the Company's evaluation of the impact of the adoption of ASU No. 2016-02 on its consolidated financial statements continues, outlined below is a summary of the status of the Company's progress: • the Company has selected a software package to assist in the determination of the right of use asset and related liability as of January 1, 2019 and to provide the required information following the adoption; • the Company has prepared summaries of its leases for input into the software package; • the Company is assessing the other inputs required in connection with the adoption of ASU No. 2016-02; and, • the Company is developing its accounting policy, procedures and controls related to the new standard. The Company does not expect to have a preliminary estimate of the right of use asset and related liability as of the adoption date until the third quarter of 2018. Accounting pronouncements adopted by the Company In May 2017, the FASB issued ASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting , which provides guidance about the changes to the terms and conditions of a share-based payment award that require an entity to apply modification accounting in "Stock Compensation (Topic 718)." The provisions of ASU No. 2017-09 are effective for reporting periods beginning after December 15, 2017; early adoption is permitted. The provisions of ASU No. 2017-09 are to be applied prospectively to an award modified on or after the adoption date. The Company early adopted the provisions of ASU No. 2017-09 during the third quarter of 2017 and the adoption of this standard update did not have a material impact on its consolidated and combined financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which clarifies how cash receipts and cash payments in certain transactions are presented and classified on the statement of cash flows. The provisions of ASU No. 2016-15 are effective for reporting periods beginning after December 15, 2017, including interim periods, and will require adoption on a retrospective basis unless it is impracticable to apply, in which case we would be required to apply the amendments prospectively as of the earliest date practicable; early adoption is permitted. The Company early adopted the provisions of ASU No. 2016-15 on January 1, 2017 and the adoption of this standard update did not have a material impact on its consolidated and combined financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . The Company adopted the provisions of ASU No. 2016-09 on January 1, 2017. Excess tax benefits or deficiencies related to equity awards to employees upon exercise of stock options, stock appreciation rights and the vesting of restricted stock units after January 1, 2017 are (i) reflected in the consolidated and combined statement of operations as a component of the provision for income taxes, rather than recognized in equity (adopted on a prospective basis), and (ii) reflected as operating, rather than financing, cash flows in our consolidated and combined statement of cash flows (adopted on a retrospective basis). Excess tax benefits for the year ended December 31, 2017 were $35.8 million . Excess tax benefits of $7.7 million and $0.1 million for the years ended December 31, 2016 and 2015 , respectively were reclassified in the combined statement of cash flows to conform to the current year presentation. The Company continues to account for forfeitures using an estimated forfeiture rate. In January 2017, the FASB issued ASU No. 2017-04, Intangibles — Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment , which is intended to simplify the accounting for goodwill impairment. The guidance eliminates the requirement to calculate the implied fair value of goodwill under the two-step impairment test to measure a goodwill impairment charge. The Company early adopted the provisions of ASU No. 2017-04 on January 1, 2017 and the adoption of this standard update did not have a material impact on its consolidated and combined financial statements. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform to the current year presentation. |
SUMMARY OF SIGNIFICANT ACCOUN30
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Property and Equipment | Property and equipment, including significant improvements, are recorded at cost. Repairs and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, or, in the case of leasehold improvements, the lease term, if shorter. Asset Category Estimated Useful Lives Computer equipment and capitalized software 2 to 3 Years Furniture and other equipment 5 to 7 Years Buildings and leasehold improvements 5 to 25 Years December 31, 2017 2016 (In thousands) Property and equipment, net of accumulated depreciation and amortization: Computer equipment and capitalized software $ 41,853 $ 27,309 Buildings and leasehold improvements 13,984 6,075 Furniture and other equipment 6,222 3,140 Projects in progress 12,801 5,198 Land 2,800 — 77,660 41,722 Accumulated depreciation and amortization (24,368 ) (18,077 ) Property and equipment, net of accumulated depreciation and amortization $ 53,292 $ 23,645 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Before Income Taxes | U.S. and foreign (loss) earnings before income taxes and noncontrolling interests are as follows: Years Ended December 31, 2017 2016 2015 (In thousands) U.S. $ (132,000 ) $ 27,284 $ 1,149 Foreign (21,633 ) (4,819 ) (3,387 ) Total $ (153,633 ) $ 22,465 $ (2,238 ) |
Schedule of Components of Income Tax Expense (Benefit) | The components of the (benefit) provision for income taxes are as follows: Years Ended December 31, 2017 2016 2015 (In thousands) Current income tax provision (benefit): Federal $ (443 ) $ 13,440 $ 2,901 State 21 2,274 601 Foreign (334 ) (161 ) 1,725 Current income tax (benefit) provision (756 ) 15,553 5,227 Deferred income tax benefit Federal (38,587 ) (2,483 ) (2,823 ) State (8,467 ) (775 ) (557 ) Foreign (1,296 ) (461 ) (89 ) Deferred income tax benefit (48,350 ) (3,719 ) (3,469 ) Income tax (benefit) provision $ (49,106 ) $ 11,834 $ 1,758 |
Schedule of Deferred Tax Assets and Liabilities | The tax effects of cumulative temporary differences that give rise to significant deferred tax assets and deferred tax liabilities are presented below. The valuation allowance relates to deferred tax assets for which it is more likely than not that the tax benefit will not be realized. December 31, 2017 2016 (In thousands) Deferred tax assets: Accrued expenses $ 5,468 $ 3,527 NOL carryforwards 135,042 12,869 Stock-based compensation 34,408 10,382 Allowance for bad debts 1,999 3,186 Deferred revenue 10,924 — Property and equipment 650 — Other 3,575 1,811 Total deferred tax assets 192,066 31,775 Less valuation allowance (61,563 ) (14,180 ) Net deferred tax assets 130,503 17,595 Deferred tax liabilities: Intangible and other assets (85,227 ) (1,818 ) Property and equipment — (2,661 ) Other (179 ) (133 ) Total deferred tax liabilities (85,406 ) (4,612 ) Net deferred tax assets $ 45,097 $ 12,983 |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the income tax (benefit) provision to the amounts computed by applying the statutory federal income tax rate to earnings before income taxes is shown as follows: Years Ended December 31, 2017 2016 2015 (In thousands) Income tax (benefit) provision at the federal statutory rate of 35% $ (53,771 ) $ 7,862 $ (783 ) Change in tax reserves, net 235 (72 ) 1,895 State income taxes, net of effect of federal tax benefit (3,678 ) 1,063 (39 ) Unbenefited losses 5,915 2,592 1,133 Research credit (784 ) (930 ) (645 ) Federal tax rate change to 21% 33,002 — — Stock-based compensation (32,702 ) — — Other, net 2,677 1,319 197 Income tax (benefit) provision $ (49,106 ) $ 11,834 $ 1,758 |
Schedule of Income Tax Contingencies | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: December 31, 2017 2016 2015 (In thousands) Balance at January 1 $ 602 $ 1,863 $ 129 Additions based on tax positions related to the current year 235 279 376 Additions for tax positions of prior years 711 — 1,358 Reductions for tax positions of prior years — (263 ) — Settlements — (1,277 ) — Balance at December 31 $ 1,548 $ 602 $ 1,863 |
BUSINESS COMBINATIONS (Tables)
BUSINESS COMBINATIONS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Schedule of Purchase Price | The table below summarizes the purchase price: Angie's List (In thousands) Class A common stock $ 763,684 Cash consideration for holders who elected to receive $8.50 in cash per share of Angie's List common stock 1,913 Fair value of vested and pro rata portion of unvested stock options attributable to pre-combination services 11,749 Fair value of the pro rata portion of unvested restricted stock units attributable to pre-combination services 4,038 Total purchase price $ 781,384 A summary of the costs incurred, payments made and the related accrual at December 31, 2017 is presented below. Year Ended December 31, 2017 (In thousands) Transaction and integration related costs $ 44,101 Stock-based compensation expense 122,066 Total $ 166,167 December 31, 2017 (In thousands) Charges incurred $ 44,101 Payments made (35,621 ) Accrual as of December 31 $ 8,480 The costs are allocated as follows in the accompanying consolidated and combined statement of operations: Year Ended December 31, 2017 Transaction and Integration Related Costs Stock-based Compensation Expense Total (In thousands) Cost of revenue $ — $ — $ — Selling and marketing expense 7,430 24,416 31,846 General and administrative expense 36,120 83,420 119,540 Product development expense 551 14,230 14,781 Total $ 44,101 $ 122,066 $ 166,167 |
Schedule of Preliminary Estimated Fair Value of Assets Acquired and Liabilities Assumed | The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: HomeStars (In thousands) Cash and cash equivalents $ 181 Other current assets 165 Goodwill 9,841 Intangible assets 6,414 Total assets 16,601 Current liabilities (649 ) Other long-term liabilities (1,873 ) Net assets acquired $ 14,079 The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: MyBuilder (In thousands) Cash and cash equivalents $ 6,004 Other current assets 344 Goodwill 37,072 Intangible assets 15,239 Total assets 58,659 Current liabilities (2,065 ) Other long-term liabilities (2,595 ) Net assets acquired $ 53,999 The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: MyHammer (In thousands) Cash and cash equivalents $ 4,041 Other current assets 790 Goodwill 22,277 Intangible assets 8,107 Total assets 35,215 Current liabilities (2,642 ) Other long-term liabilities (2,447 ) Net assets acquired $ 30,126 The table below summarizes the fair values of the assets acquired and liabilities assumed at the date of combination: Angie's List (In thousands) Cash and cash equivalents $ 44,270 Other current assets 11,280 Property and equipment 16,341 Goodwill 545,204 Intangible assets 317,300 Total assets 934,395 Deferred revenue (32,595 ) Other current liabilities (46,150 ) Long-term debt - related party (61,498 ) Deferred income taxes (11,363 ) Other long-term liabilities (1,405 ) Net assets acquired $ 781,384 |
Schedule of Preliminary Estimated Fair Value of Intangible Assets Acquired | The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: HomeStars (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 2,358 Indefinite Contractor relationships 2,435 2 Developed technology 1,522 2 User base 99 1 Total identifiable intangible assets acquired $ 6,414 The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: MyHammer (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 4,553 Indefinite Contractor relationships 1,444 4 Developed technology 1,222 3 User base 888 1 Total identifiable intangible assets acquired $ 8,107 The fair values of the identifiable intangible assets acquired at the date of combination are as follows: Angie's List (In thousands) Weighted-average useful life (years) Indefinite-lived trade name and trademarks $ 137,000 Indefinite Service professionals 90,500 3 Developed technology 63,900 6 Memberships 15,900 3 User base 10,000 1 Total identifiable intangible assets acquired $ 317,300 The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows: MyBuilder (In thousands) Weighted-average useful life (years) Indefinite-lived trade name $ 7,994 Indefinite Contractor relationships 4,122 2 Developed technology 1,499 2 User base 1,624 1 Total identifiable intangible assets acquired $ 15,239 |
Schedule of Pro Forma Financial Information | The unaudited pro forma financial information in the table below presents the combined results of the Company and Angie's List, HomeStars, MyBuilder and MyHammer as if these acquisitions had occurred on January 1, 2016. The unaudited pro forma financial information includes adjustments required under the acquisition method of accounting and is presented for informational purposes only and is not necessarily indicative of the results that would have been achieved had the acquisitions actually occurred on January 1, 2016. For the year ended December 31, 2017 , pro forma adjustments include (i) reductions in stock-based compensation expense of $96.9 million and transaction related costs of $35.2 million because they are one-time in nature and will not have a continuing impact on operations; and (ii) an increase in amortization of intangibles of $31.2 million . The stock-based compensation expense is primarily related to the modification of previously issued HomeAdvisor vested equity awards, which were converted into ANGI Homeservices' equity awards, and the acceleration of previously issued Angie's List equity awards held by employees terminated in connection with the Combination. The transaction related costs include severance and retention costs of $19.8 million related to the Combination. For the year ended December 31, 2016 , pro forma adjustments include a reduction in revenue of $35.0 million due to the write-offs of deferred revenue at the assumed date of acquisition as well as increases in stock-based compensation expense of $81.7 million and amortization of intangibles of $64.0 million . Years Ended December 31, 2017 2016 (In thousands, except per share data) Revenue $ 962,597 $ 809,999 Net loss attributable to ANGI Homeservices Inc. shareholders $ (36,459 ) $ (86,557 ) Basic and diluted loss per share attributable to ANGI Homeservices Inc. shareholders $ (0.08 ) $ (0.21 ) |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill and Intangible Assets, Net | Goodwill and intangible assets, net are as follows: December 31, 2017 2016 (In thousands) Goodwill $ 770,226 $ 170,990 Intangible assets with indefinite lives 153,447 4,884 Intangible assets with definite lives, net of accumulated amortization 175,124 5,908 Total goodwill and intangible assets, net $ 1,098,797 $ 181,782 |
Schedule of Goodwill by Reporting Unit | The following table presents the balance of goodwill by reportable segment, including the changes in the carrying value of goodwill, for the year ended December 31, 2017 : Balance at Additions Deductions Foreign Balance at December 31, (In thousands) North America $ 140,930 $ 555,045 $ — $ 316 $ 696,291 Europe 30,060 37,257 — 6,618 73,935 Total goodwill $ 170,990 $ 592,302 $ — $ 6,934 $ 770,226 Additions relate to the acquisitions of Angie's List and HomeStars (included in the North America segment) and MyBuilder (included in the Europe segment). The following table presents the balance of goodwill by reportable segment, including the changes in the carrying value of goodwill, for the year ended December 31, 2016 : Balance at Additions (Deductions) Foreign Balance at (In thousands) North America $ 140,930 $ — $ — $ — $ 140,930 Europe 9,700 21,985 — (1,625 ) 30,060 Total goodwill $ 150,630 $ 21,985 $ — $ (1,625 ) $ 170,990 Additions relate to the acquisition of MyHammer. |
Schedule of Intangible Assets with Definite Lives | Intangible assets with indefinite lives are trade names and trademarks acquired in various acquisitions. At December 31, 2017 and December 31, 2016 , intangible assets with definite lives are as follows: December 31, 2017 Gross Accumulated Net Weighted-average (Dollars in thousands) Contractor and service professional relationships $ 99,497 $ (11,452 ) $ 88,045 3.0 Technology 78,690 (14,127 ) 64,563 5.6 Memberships 15,900 (1,340 ) 14,560 3.0 Customer lists and user base 12,788 (4,906 ) 7,882 1.0 Trade names 4,538 (4,464 ) 74 2.6 Total $ 211,413 $ (36,289 ) $ 175,124 3.8 December 31, 2016 Gross Accumulated Net Weighted-average (Dollars in thousands) Contractor relationships $ 1,830 $ (495 ) $ 1,335 4.0 Technology 11,377 (7,834 ) 3,543 4.3 Customer lists and user base 4,136 (3,432 ) 704 1.8 Trade names 5,260 (4,934 ) 326 2.9 Total $ 22,603 $ (16,695 ) $ 5,908 3.5 |
Schedule of Expected Amortization of Intangible Assets | At December 31, 2017 , amortization of intangible assets with definite lives for each of the next five years and thereafter is estimated to be as follows: Years ending December 31, (In thousands) 2018 $ 60,657 2019 47,731 2020 37,477 2021 10,650 2022 10,650 Thereafter 7,959 Total $ 175,124 |
FAIR VALUE MEASUREMENTS AND F34
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis: December 31, 2017 Quoted market Significant Significant Total (In thousands) Assets: Cash equivalents: Money market funds $ 189,207 $ — $ — $ 189,207 Treasury discount notes 500 — — 500 Certificates of deposit — 6,195 — 6,195 Total $ 189,707 $ 6,195 $ — $ 195,902 December 31, 2016 Quoted market prices in active markets for identical assets Significant Significant Total (In thousands) Assets: Cash equivalents: Money market funds $ 28,064 $ — $ — $ 28,064 Total $ 28,064 $ — $ — $ 28,064 |
Carrying Value and Fair Value of Financial Instruments | The following table presents the carrying value and the fair value of financial instruments measured at fair value only for disclosure purposes: December 31, 2017 December 31, 2016 Carrying value Fair value Carrying value Fair value (In thousands) Current portion of long term debt $ (13,750 ) $ (13,802 ) $ — $ — Long-term debt, net (258,312 ) (262,230 ) — — Current portion of long-term debt—related party (816 ) (837 ) (2,838 ) (2,776 ) Long-term debt—related party, net (1,997 ) (2,048 ) (47,000 ) (46,324 ) |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consists of: December 31, 2017 2016 (In thousands) Term Loan due November 1, 2022 $ 275,000 $ — Less: current portion of Term Loan 13,750 — Less: unamortized debt issuance costs 2,938 — Total long-term debt, net $ 258,312 $ — |
Schedule of Aggregate Contractual Maturities of Long-term Debt | Long-term debt maturities: Years Ending December 31, (In thousands) 2018 $ 13,750 2019 13,750 2020 13,750 2021 27,500 2022 206,250 Total 275,000 Less: current portion of Term Loan 13,750 Less: unamortized debt issuance costs 2,938 Total long-term debt, net $ 258,312 |
ACCUMULATED OTHER COMPREHENSI36
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | For the years ended December 31, 2017 , 2016 and 2015 , the Company's accumulated other comprehensive income (loss) relates to foreign currency translation adjustments, which is presented in the table below. Years Ended December 31, 2017 2016 2015 (In thousands) Balance at January 1 $ (1,721 ) $ (1,064 ) $ (483 ) Other comprehensive income (loss) before reclassifications 3,980 (657 ) (581 ) Amounts reclassified to earnings (27 ) — — Net current period other comprehensive income (loss) 3,953 (657 ) (581 ) Balance at December 31 $ 2,232 $ (1,721 ) $ (1,064 ) |
(LOSS) EARNINGS PER SHARE (Tabl
(LOSS) EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings per Share | The following table sets forth the computation of basic and diluted (loss) earnings per share attributable to ANGI Homeservices shareholders: Years Ended December 31, 2017 2016 2015 Basic Diluted Basic Diluted Basic Diluted (In thousands, except per share data) Numerator: Net (loss) earnings $ (104,527 ) $ (104,527 ) $ 10,631 $ 10,631 $ (3,996 ) $ (3,996 ) Net loss attributable to noncontrolling interests 1,409 1,409 2,497 2,497 2,671 2,671 Net (loss) earnings attributable to ANGI Homeservices Inc. shareholders $ (103,118 ) $ (103,118 ) $ 13,128 $ 13,128 $ (1,325 ) (1,325 ) Denominator: Weighted average basic shares outstanding 430,612 430,612 414,754 414,754 414,754 414,754 Dilutive securities including stock appreciation rights, stock options, RSUs and subsidiary denominated equity awards (a) — — — — — — Denominator for earnings per share—weighted average shares (b) 430,612 430,612 414,754 414,754 414,754 414,754 (Loss) earnings per share attributable to ANGI Homeservices Inc. shareholders: (Loss) earnings per share $ (0.24 ) $ (0.24 ) $ 0.03 $ 0.03 $ (0.00 ) $ (0.00 ) ________________________ (a) For the year ended December 31, 2017 , the Company had a loss from operations and as a result, approximately 54.1 million potentially dilutive securities were excluded from computing dilutive earnings per share because the impact would have been anti-dilutive. Accordingly, the weighted average basic shares outstanding were used to compute diluted earnings per share amounts. (b) The Company computed basic and diluted earnings per share for the years ended December 31, 2016 and 2015 using the shares issued to IAC for the contribution of the HomeAdvisor business. |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Changes in Outstanding Stock Options | Stock options and stock appreciation rights outstanding at December 31, 2017 and changes during the year ended December 31, 2017 is as follows: December 31, 2017 Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (In Years) Aggregate Intrinsic Value (Shares and intrinsic value in thousands) Outstanding HomeAdvisor (US) stock appreciation rights at January 1, 2017 13,830 $ 3.97 Granted 4,720 16.83 Exercised (6,659 ) 2.87 Forfeited (110 ) 9.86 Outstanding HomeAdvisor (US) stock appreciation rights prior to the Combination on September 29, 2017 11,781 9.69 Converted HomeAdvisor (US) stock appreciation rights in connection with the Combination 43,780 2.61 Converted Angie's List stock options in connection with the Combination 5,290 10.56 Granted 948 11.32 Exercised (1,948 ) 7.40 Forfeited (331 ) 6.86 Expired (624 ) 17.94 Outstanding at December 31, 2017 47,115 $ 3.25 7.1 $ 346,595 Exercisable 17,358 $ 2.22 4.7 $ 148,729 |
Schedule of Information for Stock Options Outstanding and Exercisable | The following table summarizes the information about stock options and stock appreciation rights outstanding and exercisable at December 31, 2017 : Awards Outstanding Awards Exercisable Range of Exercise Prices Outstanding at December 31, 2017 Weighted Average Remaining Contractual Life in Years Weighted Average Exercise Price Exercisable at December 31, 2017 Weighted Average Remaining Contractual Life in Years Weighted Average Exercise Price (Shares in thousands) $0.01 to $3.00 26,143 6.0 $ 1.32 15,462 4.8 $ 0.99 $3.01 to $6.00 17,580 9.1 4.54 50 6.5 5.82 $6.01 to $9.00 1,210 5.5 7.66 711 4.1 7.68 $9.01 to $12.00 950 9.0 10.57 202 6.3 9.92 $12.01 to $15.00 718 718 5.6 13.12 420 3.0 13.34 $15.01 to $18.00 239 239 0.5 17.71 238 0.4 17.72 $18.01 to $21.00 192 192 5.2 19.88 192 5.2 19.88 $21.01 to $24.00 83 83 4.8 22.51 83 4.8 22.51 47,115 7.1 $ 3.25 17,358 4.7 $ 2.22 |
Schedule of Weighted Average Assumptions | The following are the weighted average assumptions used in the Black-Scholes option pricing model: Years Ended December 31, 2017 2016 2015 Expected volatility 50 % 44 % 48 % Risk-free interest rate 2.0 % 0.8 % 1.2 % Expected term 5.5 years 3.2 years 3.7 years Dividend yield — % — % — % |
Schedule of Outstanding Unvested RSUs | Prior to the Combination, there were no RSUs outstanding. Unvested RSUs outstanding at December 31, 2017 and changes during the year ended December 31, 2017 is as follows: RSUs Number of Shares Weighted Average Grant Date Fair Value (Shares in thousands) Converted Angie's List RSUs in connection with the Combination 4,957 $ 12.46 Granted 489 12.58 Vested (1,574 ) 12.46 Forfeited (977 ) 12.46 Unvested at December 31, 2017 2,895 $ 12.48 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | Years Ended December 31, 2017 2016 2015 (In thousands) Revenue: North America $ 678,897 $ 461,847 $ 329,867 Europe 57,489 37,043 31,334 Total $ 736,386 $ 498,890 $ 361,201 Years Ended December 31, 2017 2016 2015 (In thousands) Operating (Loss) Income: North America $ (128,483 ) $ 32,464 $ 2,311 Europe (19,388 ) (8,406 ) (3,879 ) Total $ (147,871 ) $ 24,058 $ (1,568 ) Years Ended December 31, 2017 2016 2015 (In thousands) Adjusted EBITDA (a) : North America $ 50,182 $ 50,088 $ 18,184 Europe (11,019 ) (5,542 ) (1,471 ) Total $ 39,163 $ 44,546 $ 16,713 December 31, 2017 2016 (In thousands) Segment Assets: (b) North America $ 253,582 $ 24,630 Europe 10,868 50,249 Total $ 264,450 $ 74,879 Years Ended December 31, 2017 2016 2015 (In thousands) Capital expenditures: North America $ 24,214 $ 14,672 $ 9,933 Europe 2,623 1,988 237 Total $ 26,837 $ 16,660 $ 10,170 ___________________________ (a) The Company’s primary financial measure is Adjusted EBITDA, which is defined as operating income excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of amortization of intangible assets and impairments of goodwill and intangible assets, if applicable. The Company believes this measure is useful for analysts and investors as this measure allows a more meaningful comparison between our performance and that of our competitors. Moreover, our management uses this measure internally to evaluate the performance of our business as a whole and our individual business segments, and this measure is one of the primary metrics by which our internal budgets are based and by which management is compensated. The above items are excluded from our Adjusted EBITDA measure because these items are non-cash in nature, and we believe that by excluding these items, Adjusted EBITDA corresponds more closely to the cash operating income generated from our business, from which capital investments are made and long-term related party debt is serviced. Adjusted EBITDA has certain limitations in that it does not take into account the impact to ANGI Homeservices Inc.'s statement of operations of certain expenses. (b) Consistent with the Company's primary metric (described in (a) above), the Company excludes, if applicable, property and equipment, goodwill and intangible assets from the measure of segment assets presented above. |
Schedule of Segmented Revenue Disaggregated by Service | The following table presents revenue disaggregated by service for the Company's reportable segments: Years Ended December 31, 2017 2016 2015 (In thousands) Marketplace: Consumer connection revenue (c) $ 521,481 $ 382,466 $ 269,309 Membership subscription revenue 56,135 43,573 24,164 Other revenue 3,798 2,827 3,423 Marketplace revenue 581,414 428,866 296,896 Advertising & Other revenue (d) 97,483 32,981 32,971 North America 678,897 461,847 329,867 Consumer connection revenue (c) 40,009 28,124 23,298 Membership subscription revenue 16,596 7,936 6,921 Advertising and other revenue 884 983 1,115 Europe 57,489 37,043 31,334 Revenue $ 736,386 $ 498,890 $ 361,201 ___________________________ (c) Fees paid by service professionals for consumer matches. (d) Includes Angie's List revenue from service professionals under contract for advertising and Angie's List membership subscription fees from consumers, as well as revenue from mHelpDesk, HomeStars and Felix. |
Schedule of Revenue and Long-lived Assets by Geographic Areas | Geographic information about revenue and long-lived assets is presented below. Revenue by geography is based on where the customer is located. Years Ended December 31, 2017 2016 2015 (In thousands) Revenue United States $ 672,159 $ 461,372 $ 329,117 All other countries 64,227 37,518 32,084 Total $ 736,386 $ 498,890 $ 361,201 The United States is the only country whose revenue is greater than 10% of total revenue of the Company for the years ended December 31, 2017 , 2016 and 2015 . December 31, 2017 2016 (In thousands) Long-lived assets (excluding goodwill and intangible assets) United States $ 49,356 $ 21,775 All other countries 3,936 1,870 Total $ 53,292 $ 23,645 |
Schedule of Reconciliation of Adjusted EBITDA to Operating Income (Loss) | The following tables reconcile operating (loss) income for the Company’s reportable segments and net (loss) earnings attributable to ANGI Homeservices Inc. shareholders to Adjusted EBITDA: Year Ended December 31, 2017 Operating Stock-based Depreciation Amortization Adjusted EBITDA (In thousands) North America $ (128,483 ) $ 147,574 $ 13,243 $ 17,848 $ 50,182 Europe (19,388 ) 1,656 1,300 5,413 (11,019 ) Total (147,871 ) $ 149,230 $ 14,543 $ 23,261 $ 39,163 Interest expense—third party (1,765 ) Interest expense—related party (5,971 ) Other income, net 1,974 Loss before income taxes (153,633 ) Income tax benefit 49,106 Net loss (104,527 ) Net loss attributable to noncontrolling interests 1,409 Net loss attributable to ANGI Homeservices Inc. shareholders $ (103,118 ) Year Ended December 31, 2016 Operating Stock-based Depreciation Amortization Adjusted (In thousands) North America $ 32,464 $ 7,126 $ 7,996 $ 2,502 $ 50,088 Europe (8,406 ) 1,790 423 651 (5,542 ) Total 24,058 $ 8,916 $ 8,419 $ 3,153 $ 44,546 Interest expense—third party — Interest expense—related party (894 ) Other expense, net (699 ) Earnings before income taxes 22,465 Income tax provision (11,834 ) Net earnings 10,631 Net loss attributable to noncontrolling interests 2,497 Net earnings attributable to ANGI Homeservices Inc. shareholders $ 13,128 Year Ended December 31, 2015 Operating Stock-based Depreciation Amortization Adjusted (In thousands) North America $ 2,311 $ 6,758 $ 5,768 $ 3,347 $ 18,184 Europe (3,879 ) 1,095 825 488 (1,471 ) Total (1,568 ) $ 7,853 $ 6,593 $ 3,835 $ 16,713 Interest expense—third party — Interest expense—related party (272 ) Other expense, net (398 ) Loss before income taxes (2,238 ) Income tax provision (1,758 ) Net loss (3,996 ) Net loss attributable to noncontrolling interests 2,671 Net loss attributable to ANGI Homeservices Inc. shareholders $ (1,325 ) |
Schedule of Reconciliation of Segment Assets to Total Assets | The following tables reconcile segment assets to total assets: December 31, 2017 Segment assets Property and equipment, net Goodwill Indefinite-lived intangible assets Definite-lived Total assets (In thousands) North America $ 253,582 $ 49,487 $ 696,291 $ 140,034 $ 169,054 $ 1,308,448 Europe 10,868 3,805 73,935 13,413 6,070 108,091 Total $ 264,450 $ 53,292 $ 770,226 $ 153,447 $ 175,124 $ 1,416,539 Add: Deferred tax assets (e) 50,723 Total assets $ 1,467,262 December 31, 2016 Segment assets Property and equipment, net Goodwill Indefinite-lived intangible assets Definite-lived Total assets (In thousands) North America $ 24,630 $ 21,775 $ 140,930 $ 600 $ 2,454 $ 190,389 Europe 50,249 1,870 30,060 4,284 3,454 89,917 Total $ 74,879 $ 23,645 $ 170,990 $ 4,884 $ 5,908 $ 280,306 Add: Deferred tax assets (e) 15,211 Total assets $ 295,517 ___________________________ (e) Total segment assets differ from total assets on a consolidated basis as a result of unallocated deferred tax assets. |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments Under Operating Lease Agreements | Future minimum payments under operating lease agreements are as follows: Years ending December 31, (In thousands) 2018 $ 11,090 2019 13,728 2020 10,859 2021 9,578 2022 8,306 Thereafter 32,820 Total $ 86,381 |
Schedule of Commercial Commitments Outstanding | The Company also has funding commitments that could potentially require its performance in the event of demands by third parties or contingent events as follows: Amount of commitment expiration per period Less than 1 Year 1 to 3 years Total (In thousands) Purchase obligations $ 831 $ 650 $ 1,481 |
SUPPLEMENTAL CASH FLOW INFORM41
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of Supplemental Disclosure of Cash Flow Information | Supplemental Disclosure of Cash Flow Information: Years Ended December 31, 2017 2016 2015 (In thousands) Cash paid (received) during the year for: Interest—third party $ — $ — $ — Interest—related party 6,169 417 262 Income tax payments, including amounts paid to IAC for ANGI Homeservices share of IAC's consolidated tax liability 1,700 8,820 3,424 Income tax refunds (402 ) (263 ) (657 ) |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The following table summarizes the components of the net (increase) decrease in IAC’s investment in HomeAdvisor prior to the contribution of the HomeAdvisor business to ANGI Homeservices: December 31, 2017 2016 2015 (In thousands) Cash transfers (from) to IAC related to its centrally managed U.S. treasury management function, acquisitions and cash expenses paid by IAC on behalf of HomeAdvisor, net $ (80,368 ) $ (363 ) $ 8,801 Taxes 38,162 (5,968 ) (3,281 ) Interest income (a) 656 278 86 Allocation of general and administrative expense (4,789 ) (4,247 ) (2,598 ) Net (increase) decrease in IAC’s investment in HomeAdvisor $ (46,339 ) $ (10,300 ) $ 3,008 ________________________________ (a) Interest expense on long-term debt—related party is not included. |
Schedule of Long-term Debt by Related Parties | Long-term debt—related party consists of: December 31, 2017 2016 (In thousands) Promissory note due October 14, 2023 $ — $ 42,000 Promissory note due August 29, 2018 — 5,000 Other 2,813 2,838 Total long-term debt—related party 2,813 49,838 Less: Current portion of long-term debt—related party 816 2,838 Total long-term debt—related party, net $ 1,997 $ 47,000 |
Schedule of Maturities of Long-Term Debt by Related Parties | Long-term debt—related party maturities: Years Ending December 31, (In thousands) 2018 $ 816 2019 1,495 2020 502 Total long-term debt—related party $ 2,813 |
CONSOLIDATED AND COMBINED FIN43
CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Other Current Assets | December 31, 2017 2016 (In thousands) Other current assets: Prepaid expenses $ 10,937 $ 6,456 Other 1,835 2,283 Other current assets $ 12,772 $ 8,739 |
Schedule of Property and Equipment, Net | Property and equipment, including significant improvements, are recorded at cost. Repairs and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, or, in the case of leasehold improvements, the lease term, if shorter. Asset Category Estimated Useful Lives Computer equipment and capitalized software 2 to 3 Years Furniture and other equipment 5 to 7 Years Buildings and leasehold improvements 5 to 25 Years December 31, 2017 2016 (In thousands) Property and equipment, net of accumulated depreciation and amortization: Computer equipment and capitalized software $ 41,853 $ 27,309 Buildings and leasehold improvements 13,984 6,075 Furniture and other equipment 6,222 3,140 Projects in progress 12,801 5,198 Land 2,800 — 77,660 41,722 Accumulated depreciation and amortization (24,368 ) (18,077 ) Property and equipment, net of accumulated depreciation and amortization $ 53,292 $ 23,645 |
Schedule of Accrued Expenses and Other Current Liabilities | December 31, 2017 2016 (In thousands) Accrued expenses and other current liabilities: Accrued employee compensation and benefits $ 30,354 $ 14,379 Accrued advertising expense 17,243 8,209 Other 27,574 11,850 Accrued expenses and other current liabilities $ 75,171 $ 34,438 |
Schedule of Other Income (Expense), Net | Years Ended December 31, 2017 2016 2015 (In thousands) Other income (expense), net $ 1,974 $ (699 ) $ (398 ) |
TRANSACTION AND INTEGRATION R44
TRANSACTION AND INTEGRATION RELATED COSTS IN CONNECTION WITH THE COMBINATION (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Schedule of Purchase Price | The table below summarizes the purchase price: Angie's List (In thousands) Class A common stock $ 763,684 Cash consideration for holders who elected to receive $8.50 in cash per share of Angie's List common stock 1,913 Fair value of vested and pro rata portion of unvested stock options attributable to pre-combination services 11,749 Fair value of the pro rata portion of unvested restricted stock units attributable to pre-combination services 4,038 Total purchase price $ 781,384 A summary of the costs incurred, payments made and the related accrual at December 31, 2017 is presented below. Year Ended December 31, 2017 (In thousands) Transaction and integration related costs $ 44,101 Stock-based compensation expense 122,066 Total $ 166,167 December 31, 2017 (In thousands) Charges incurred $ 44,101 Payments made (35,621 ) Accrual as of December 31 $ 8,480 The costs are allocated as follows in the accompanying consolidated and combined statement of operations: Year Ended December 31, 2017 Transaction and Integration Related Costs Stock-based Compensation Expense Total (In thousands) Cost of revenue $ — $ — $ — Selling and marketing expense 7,430 24,416 31,846 General and administrative expense 36,120 83,420 119,540 Product development expense 551 14,230 14,781 Total $ 44,101 $ 122,066 $ 166,167 |
QUARTERLY RESULTS (UNAUDITED) (
QUARTERLY RESULTS (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Results | Quarter Ended March 31 Quarter Ended June 30 Quarter Ended September 30 (a) Quarter Ended December 31 (b) (In thousands, except per share data) Year Ended December 31, 2017 Revenue $ 150,745 $ 180,711 $ 181,717 $ 223,213 Cost of revenue 6,830 7,562 7,999 11,682 Operating income (loss) 1,388 (2,836 ) (112,505 ) (33,918 ) Net earnings (loss) 25,887 (25 ) (72,158 ) (58,231 ) Net earnings (loss) attributable to ANGI Homeservices Inc. shareholders 26,613 254 (71,761 ) (58,224 ) Per share information attributable to ANGI Homeservices Inc. shareholders: Basic earnings (loss) per share (c) $ 0.06 $ 0.00 $ (0.17 ) $ (0.12 ) Diluted earnings (loss) per share (c) $ 0.06 $ 0.00 $ (0.17 ) $ (0.12 ) Quarter Ended March 31 Quarter Ended June 30 Quarter Ended September 30 Quarter Ended December 31 (In thousands, except per share data) Year Ended December 31, 2016 Revenue $ 111,489 $ 130,173 $ 133,560 $ 123,668 Cost of revenue 5,994 6,745 6,826 6,293 Operating (loss) income (514 ) 9,513 8,843 6,216 Net (loss) earnings (1,244 ) 5,351 4,468 2,056 Net (loss) earnings attributable to ANGI Homeservices Inc. shareholders (677 ) 6,010 5,075 2,720 Per share information attributable to ANGI Homeservices Inc. shareholders: Basic (loss) earnings per share (c) $ (0.00 ) $ 0.01 $ 0.01 $ 0.01 Diluted (loss) earnings per share (c) $ (0.00 ) $ 0.01 $ 0.01 $ 0.01 _________________________________________________________________________ (a) The third quarter of 2017 includes after-tax stock-based compensation expense of $59.4 million related primarily to the modification of previously issued HomeAdvisor vested awards, which were converted into ANGI Homeservices equity awards, and the acceleration of certain Angie’s List equity awards in connection with the Combination, as well as after-tax costs of $17.0 million related to the Combination. (b) The fourth quarter of 2017 includes after-tax stock-based compensation expense of $15.6 million related primarily to the modification of previously issued HomeAdvisor unvested awards, which were converted into ANGI Homeservices equity awards, the expense related to previously issued Angie's List equity awards and the acceleration of certain Angie's List equity awards resulting from the termination of employees in connection with the Combination, as well as after-tax costs of $13.8 million related to the Combination (including $7.6 million of deferred revenue write-offs). (c) Quarterly per share amounts may not add to the related annual per share amount because of differences in the average common shares outstanding during each period. |
ORGANIZATION - NARRATIVE (Detai
ORGANIZATION - NARRATIVE (Details) - Dec. 31, 2017 Service_Professional in Thousands, Professional_Under_Contract_For_Adverstising in Thousands, customer in Millions | customer | Professional_Under_Contract_For_Adverstising | Service_Professional | Total |
Customer Information [Abstract] | ||||
Number of Customers | 45 | 181 | ||
Number of Marketplace Service Requests | 18.1 | |||
Class B Common Stock | IAC | ||||
Customer Information [Abstract] | ||||
Ownership interest (as a percent) | 86.90% | |||
Voting interest (as a percent) | 98.50% |
SUMMARY OF SIGNIFICANT ACCOUN47
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - NARRATIVE (Details) - USD ($) | Oct. 01, 2017 | Sep. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred revenue | |||||
Deferred revenue | $ 64,100,000 | $ 18,800,000 | |||
Cash equivalents maturity period at purchase (less than) | 91 days | ||||
Market capitalization | $ 5,900,000,000 | ||||
Percentage of market capitalization | 450.00% | ||||
Discount rate of fair value inputs (as a percent) | 17.00% | ||||
Goodwill and indefinite-lived intangible assets impairment | $ 0 | $ 0 | $ 0 | ||
Advertising expense | 282,300,000 | 196,800,000 | 145,400,000 | ||
Adjustment of redeemable noncontrolling interests to fair value | (3,332,000) | 3,110,000 | (12,170,000) | ||
Retained earnings (accumulated deficit) | (121,764,000) | 0 | |||
Net (loss) earnings | (104,527,000) | 10,631,000 | (3,996,000) | ||
Excess tax benefit of share-based compensation | 32,702,000 | 0 | 0 | ||
Angie's List | |||||
Deferred revenue | |||||
Deferred revenue | 37,700,000 | ||||
Redeemable Noncontrolling Interest | |||||
Deferred revenue | |||||
Adjustment of redeemable noncontrolling interests to fair value | 3,332,000 | (3,110,000) | 12,170,000 | ||
Restatement Adjustment | Accounting Standards Update 2016-09 | |||||
Deferred revenue | |||||
Excess tax benefit of share-based compensation | $ 35,800,000 | $ 7,700,000 | $ 100,000 | ||
Europe | |||||
Deferred revenue | |||||
Percentage of market capitalization | 60.00% | ||||
North America | |||||
Deferred revenue | |||||
Percentage of market capitalization | 500.00% | ||||
Minimum | |||||
Deferred revenue | |||||
Discount rate of fair value inputs (as a percent) | 11.50% | ||||
Maximum | |||||
Deferred revenue | |||||
Discount rate of fair value inputs (as a percent) | 18.50% | ||||
Indefinite-lived Intangible Assets | |||||
Deferred revenue | |||||
Royalty rate of impairment assessment of indefinite lived intangibles (as a percent) | 1.00% | ||||
Indefinite-lived Intangible Assets | Minimum | |||||
Deferred revenue | |||||
Royalty rate of impairment assessment of indefinite lived intangibles (as a percent) | 1.00% | ||||
Indefinite-lived Intangible Assets | Maximum | |||||
Deferred revenue | |||||
Royalty rate of impairment assessment of indefinite lived intangibles (as a percent) | 6.00% | ||||
Difference between Revenue Guidance in Effect before and after Topic 606 | Accounting Standards Update 2014-09 | |||||
Deferred revenue | |||||
Current capitalized contract cost | $ 30,000,000 | ||||
Non-current capitalized contract cost | 5,000,000 | ||||
Deferred tax liability | 10,000,000 | ||||
Retained earnings (accumulated deficit) | 25,000,000 | ||||
Net (loss) earnings | $ 8,000,000 |
SUMMARY OF SIGNIFICANT ACCOUN48
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - SCHEDULE OF ESTIMATED USEFUL LIVES OF PROPERTY AND EQUIPMENT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, net | $ 53,292 | $ 23,645 |
Computer equipment and capitalized software | Minimum | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Estimated useful life | 2 years | |
Computer equipment and capitalized software | Maximum | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Estimated useful life | 3 years | |
Furniture and other equipment | Minimum | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Estimated useful life | 5 years | |
Furniture and other equipment | Maximum | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Estimated useful life | 7 years | |
Buildings and leasehold improvements | Minimum | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Estimated useful life | 5 years | |
Buildings and leasehold improvements | Maximum | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Estimated useful life | 25 years | |
Capitalized internal use software | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, net | $ 23,300 | $ 14,500 |
INCOME TAXES - NARRATIVE (Detai
INCOME TAXES - NARRATIVE (Details) - USD ($) $ in Thousands | Dec. 22, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Tax Credit Carryforward [Line Items] | ||||
Deferred tax asset for net operating losses | $ 32,702 | $ 0 | $ 0 | |
Income tax payable | 7,700 | 100 | ||
Operating loss carryforwards not subject to expiration | 286,100 | |||
Income tax benefit related NOL | 103,800 | |||
Tax benefit recorded as a reduction to goodwill | 74,000 | |||
Deferred tax assets | 192,066 | 31,775 | ||
Valuation allowance | 61,563 | 14,180 | ||
Unrecognized tax benefits including tax interest accrued | 1,500 | 600 | ||
Income tax provision | 1,500 | 600 | ||
Income tax expense related to TCJA | $ 33,000 | |||
Restatement Adjustment | Accounting Standards Update 2016-09 | ||||
Tax Credit Carryforward [Line Items] | ||||
Deferred tax asset for net operating losses | 35,800 | $ 7,700 | $ 100 | |
Federal Tax Authority | ||||
Tax Credit Carryforward [Line Items] | ||||
Operating loss carryforwards | 317,500 | |||
State and Local Jurisdiction | ||||
Tax Credit Carryforward [Line Items] | ||||
Operating loss carryforwards | 378,600 | |||
Operating loss carryforwards not subject to expiration | 121,100 | |||
Foreign Tax Authority | ||||
Tax Credit Carryforward [Line Items] | ||||
Operating loss carryforwards not subject to expiration | 116,000 | |||
Operating loss carryforwards available to offset future income | 298,400 | |||
Operating loss carryforwards subject to expiration | 12,300 | |||
Valuation allowance | 47,400 | |||
Federal and State Tax Credits | ||||
Tax Credit Carryforward [Line Items] | ||||
Operating loss carryforwards | 3,400 | |||
Operating loss carryforwards not subject to expiration | 600 | |||
Operating loss carryforwards subject to expiration | 2,800 | |||
Deferred tax assets | $ 84,400 |
INCOME TAXES - SCHEDULE OF INCO
INCOME TAXES - SCHEDULE OF INCOME BEFORE INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
U.S. | $ (132,000) | $ 27,284 | $ 1,149 |
Foreign | (21,633) | (4,819) | (3,387) |
(Loss) earnings before income taxes | $ (153,633) | $ 22,465 | $ (2,238) |
INCOME TAXES - SCHEDULE OF COMP
INCOME TAXES - SCHEDULE OF COMPONENTS OF INCOME TAX EXEPENSE (BENEFIT) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current income tax provision (benefit): | |||
Federal | $ (443) | $ 13,440 | $ 2,901 |
State | 21 | 2,274 | 601 |
Foreign | (334) | (161) | 1,725 |
Current income tax (benefit) provision | (756) | 15,553 | 5,227 |
Deferred income tax benefit | |||
Federal | (38,587) | (2,483) | (2,823) |
State | (8,467) | (775) | (557) |
Foreign | (1,296) | (461) | (89) |
Deferred income tax benefit | (48,350) | (3,719) | (3,469) |
Income tax (benefit) provision | $ (49,106) | $ 11,834 | $ 1,758 |
INCOME TAXES - SCHEDULE OF DEFE
INCOME TAXES - SCHEDULE OF DEFERRED TAX ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||
Accrued expenses | $ 5,468 | $ 3,527 |
NOL carryforwards | 135,042 | 12,869 |
Stock-based compensation | 34,408 | 10,382 |
Allowance for bad debts | 1,999 | 3,186 |
Deferred revenue | 10,924 | 0 |
Property and equipment | 650 | 0 |
Other | 3,575 | 1,811 |
Total deferred tax assets | 192,066 | 31,775 |
Less valuation allowance | (61,563) | (14,180) |
Net deferred tax assets | 130,503 | 17,595 |
Deferred tax liabilities: | ||
Intangible and other assets | (85,227) | (1,818) |
Property and equipment | 0 | (2,661) |
Other | (179) | (133) |
Total deferred tax liabilities | (85,406) | (4,612) |
Net deferred tax assets | $ 45,097 | $ 12,983 |
INCOME TAXES - SCHEDULE OF EFFE
INCOME TAXES - SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Income tax (benefit) provision at the federal statutory rate of 35% | $ (53,771) | $ 7,862 | $ (783) |
Change in tax reserves, net | 235 | (72) | 1,895 |
State income taxes, net of effect of federal tax benefit | (3,678) | 1,063 | (39) |
Unbenefited losses | 5,915 | 2,592 | 1,133 |
Research credit | (784) | (930) | (645) |
Federal tax rate change to 21% | 33,002 | 0 | 0 |
Stock-based compensation | (32,702) | 0 | 0 |
Other, net | 2,677 | 1,319 | 197 |
Income tax (benefit) provision | $ (49,106) | $ 11,834 | $ 1,758 |
INCOME TAXES - SCHEDULE OF IN54
INCOME TAXES - SCHEDULE OF INCOME TAX CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | |||
Balance at January 1 | $ 602 | $ 1,863 | $ 129 |
Additions based on tax positions related to the current year | 235 | 279 | 376 |
Additions for tax positions of prior years | 711 | 1,358 | |
Reductions for tax positions of prior years | (263) | ||
Settlements | 0 | (1,277) | |
Balance at December 31 | $ 1,548 | $ 602 | $ 1,863 |
BUSINESS COMBINATIONS - NARRATI
BUSINESS COMBINATIONS - NARRATIVE (Details) $ / shares in Units, $ in Thousands, € in Millions, £ in Millions, $ in Millions | Sep. 29, 2017USD ($)$ / shares | Mar. 24, 2017USD ($) | Mar. 24, 2017GBP (£) | Feb. 08, 2017USD ($) | Feb. 08, 2017CAD ($) | Nov. 03, 2016USD ($) | Nov. 03, 2016EUR (€) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Mar. 24, 2017GBP (£) | Feb. 08, 2017CAD ($) |
Business Acquisition | ||||||||||||||||||||
Severance costs | $ 19,800 | |||||||||||||||||||
Revenue | $ 223,213 | $ 181,717 | $ 180,711 | $ 150,745 | $ 123,668 | $ 133,560 | $ 130,173 | $ 111,489 | 736,386 | $ 498,890 | $ 361,201 | |||||||||
Angie's List | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Percentage of voting interests acquired | 100.00% | |||||||||||||||||||
Consideration transferred | $ 781,384 | |||||||||||||||||||
Share price (USD per share) | $ / shares | $ 12.46 | |||||||||||||||||||
Cash acquisition price | $ 1,900 | 35,621 | ||||||||||||||||||
Cash paid to holders of acquiree common stock (in dollars per share) | $ / shares | $ 8.50 | |||||||||||||||||||
Revenue | 58,900 | |||||||||||||||||||
Net earnings | 21,700 | |||||||||||||||||||
Severance costs | 19,800 | |||||||||||||||||||
Write-off due to deferred revenue | 7,800 | |||||||||||||||||||
HomeStars | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Percentage of voting interests acquired | 90.00% | 90.00% | ||||||||||||||||||
Cash acquisition price | $ 12,700 | $ 16.6 | ||||||||||||||||||
Working capital adjustment | $ 200 | $ 0.3 | ||||||||||||||||||
Percentage of noncontrolling interests | 10.00% | 10.00% | ||||||||||||||||||
fair value at acquisition | $ 1,400 | $ 1.9 | ||||||||||||||||||
Percentage of enterprise value of business using purchase price | 100.00% | 100.00% | ||||||||||||||||||
Revenue | 6,500 | |||||||||||||||||||
Net income (loss) | (1,200) | |||||||||||||||||||
MyBuilder | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Percentage of voting interests acquired | 75.00% | 75.00% | ||||||||||||||||||
Cash acquisition price | $ 40,700 | £ 32.6 | ||||||||||||||||||
Working capital adjustment | $ 800 | £ 0.6 | ||||||||||||||||||
Percentage of noncontrolling interests | 25.00% | 25.00% | ||||||||||||||||||
fair value at acquisition | $ 13,300 | £ 10.7 | ||||||||||||||||||
Percentage of enterprise value of business using purchase price | 100.00% | 100.00% | ||||||||||||||||||
Revenue | 8,000 | |||||||||||||||||||
Net income (loss) | $ (1,400) | |||||||||||||||||||
MyHammer | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Percentage of voting interests acquired | 70.00% | 70.00% | 81.10% | 81.10% | ||||||||||||||||
Consideration transferred | $ 19,700 | € 17.7 | ||||||||||||||||||
Percentage of noncontrolling interests | 30.00% | 30.00% | ||||||||||||||||||
fair value at acquisition | $ 10,400 | € 9.4 | ||||||||||||||||||
Revenue | $ 12,700 | 1,300 | ||||||||||||||||||
Net income (loss) | 100 | (400) | ||||||||||||||||||
Acquisition-related Costs | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Severance costs | 28,700 | |||||||||||||||||||
Adjustment to decrease transaction related costs | 35,200 | |||||||||||||||||||
Modification of Equity Awards | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Business Acquisition, Pro Forma Information, Adjustment To Increase (Decrease) Share-Based Compensation | (96,900) | (81,700) | ||||||||||||||||||
Amortization Adjustment | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Adjustment to decrease amortization of intangible assets | $ (31,200) | (64,000) | ||||||||||||||||||
Deferred Revenue Write Off Adjustment | ||||||||||||||||||||
Business Acquisition | ||||||||||||||||||||
Adjustment to decrease revenues | $ 35,000 |
BUSINESS COMBINATIONS - PURCHAS
BUSINESS COMBINATIONS - PURCHASE PRICE (Details) - USD ($) $ in Thousands | Sep. 29, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Class A Common Stock | |||
Business Acquisition | |||
Common stock | $ 63 | $ 0 | |
Angie's List | |||
Business Acquisition | |||
Cash consideration for holders who elected to receive $8.50 in cash per share of Angie's List common stock | $ 1,900 | $ 35,621 | |
Total purchase price | 781,384 | ||
Angie's List | Class A Common Stock | |||
Business Acquisition | |||
Common stock | 763,684 | ||
Cash consideration for holders who elected to receive $8.50 in cash per share of Angie's List common stock | 1,913 | ||
Angie's List | Class A Common Stock | Stock Options | |||
Business Acquisition | |||
Consideration transferred, equity interests | 11,749 | ||
Angie's List | Class A Common Stock | RSUs | |||
Business Acquisition | |||
Consideration transferred, equity interests | $ 4,038 |
BUSINESS COMBINATIONS - PRELIMI
BUSINESS COMBINATIONS - PRELIMINARY ESTIMATED FAIR VALUE OF ASSETS ACQUIRED AND LIABILITIES ASSUMED (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Sep. 29, 2017 | Mar. 24, 2017 | Feb. 08, 2017 | Dec. 31, 2016 | Nov. 03, 2016 | Dec. 31, 2015 |
Business Acquisition | |||||||
Goodwill | $ 770,226 | $ 170,990 | $ 150,630 | ||||
Angie's List | |||||||
Business Acquisition | |||||||
Cash and cash equivalents | $ 44,270 | ||||||
Other current assets | 11,280 | ||||||
Property and equipment | 16,341 | ||||||
Goodwill | 545,204 | ||||||
Intangible assets | 317,300 | ||||||
Total assets | 934,395 | ||||||
Deferred revenue | (32,595) | ||||||
Other current liabilities | (46,150) | ||||||
Long-term debt - related party | (61,498) | ||||||
Deferred income taxes | (11,363) | ||||||
Other long-term liabilities | (1,405) | ||||||
Net assets acquired | $ 781,384 | ||||||
HomeStars | |||||||
Business Acquisition | |||||||
Cash and cash equivalents | $ 181 | ||||||
Other current assets | 165 | ||||||
Goodwill | 9,841 | ||||||
Intangible assets | 6,414 | ||||||
Total assets | 16,601 | ||||||
Current liabilities | (649) | ||||||
Other long-term liabilities | (1,873) | ||||||
Net assets acquired | $ 14,079 | ||||||
MyBuilder | |||||||
Business Acquisition | |||||||
Cash and cash equivalents | $ 6,004 | ||||||
Other current assets | 344 | ||||||
Goodwill | 37,072 | ||||||
Intangible assets | 15,239 | ||||||
Total assets | 58,659 | ||||||
Current liabilities | (2,065) | ||||||
Other long-term liabilities | (2,595) | ||||||
Net assets acquired | $ 53,999 | ||||||
MyHammer | |||||||
Business Acquisition | |||||||
Cash and cash equivalents | $ 4,041 | ||||||
Other current assets | 790 | ||||||
Goodwill | 22,277 | ||||||
Intangible assets | 8,107 | ||||||
Total assets | 35,215 | ||||||
Current liabilities | (2,642) | ||||||
Other long-term liabilities | (2,447) | ||||||
Net assets acquired | $ 30,126 |
BUSINESS COMBINATIONS - INTANGI
BUSINESS COMBINATIONS - INTANGIBLE ASSETS ACQUIRED AS PART OF BUSINESS COMBINATION (Details) - USD ($) $ in Thousands | Sep. 29, 2017 | Mar. 24, 2017 | Feb. 08, 2017 | Nov. 03, 2016 |
Angie's List | ||||
Business Acquisition | ||||
Total identifiable intangible assets acquired | $ 317,300 | |||
Angie's List | Service professionals | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 90,500 | |||
Weighted-average useful life (years) | 3 years | |||
Angie's List | Developed technology | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 63,900 | |||
Weighted-average useful life (years) | 6 years | |||
Angie's List | Memberships | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 15,900 | |||
Weighted-average useful life (years) | 3 years | |||
Angie's List | User base | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 10,000 | |||
Weighted-average useful life (years) | 1 year | |||
HomeStars | ||||
Business Acquisition | ||||
Total identifiable intangible assets acquired | $ 6,414 | |||
HomeStars | Developed technology | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 1,522 | |||
Weighted-average useful life (years) | 2 years | |||
HomeStars | User base | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 99 | |||
Weighted-average useful life (years) | 1 year | |||
HomeStars | Contractor relationships | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 2,435 | |||
Weighted-average useful life (years) | 2 years | |||
MyBuilder | ||||
Business Acquisition | ||||
Total identifiable intangible assets acquired | $ 15,239 | |||
MyBuilder | Developed technology | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 1,499 | |||
Weighted-average useful life (years) | 2 years | |||
MyBuilder | User base | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 1,624 | |||
Weighted-average useful life (years) | 1 year | |||
MyBuilder | Contractor relationships | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 4,122 | |||
Weighted-average useful life (years) | 2 years | |||
MyHammer | ||||
Business Acquisition | ||||
Total identifiable intangible assets acquired | $ 8,107 | |||
MyHammer | Developed technology | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 1,222 | |||
Weighted-average useful life (years) | 3 years | |||
MyHammer | User base | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 888 | |||
Weighted-average useful life (years) | 1 year | |||
MyHammer | Contractor relationships | ||||
Business Acquisition | ||||
Finite-lived intangible assets acquired | $ 1,444 | |||
Weighted-average useful life (years) | 4 years | |||
Indefinite-lived trade name and trademarks | Angie's List | ||||
Business Acquisition | ||||
Indefinite-lived trade name and trademarks | $ 137,000 | |||
Indefinite-lived trade name and trademarks | HomeStars | ||||
Business Acquisition | ||||
Indefinite-lived trade name and trademarks | $ 2,358 | |||
Indefinite-lived trade name and trademarks | MyBuilder | ||||
Business Acquisition | ||||
Indefinite-lived trade name and trademarks | $ 7,994 | |||
Indefinite-lived trade name and trademarks | MyHammer | ||||
Business Acquisition | ||||
Indefinite-lived trade name and trademarks | $ 4,553 |
BUSINESS COMBINATIONS - SCHEDUL
BUSINESS COMBINATIONS - SCHEDULE OF PRO FORMA FINANCIAL INFORMATION (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Business Acquisition, Pro Forma Information [Abstract] | ||
Revenue | $ 962,597 | $ 809,999 |
Net loss attributable to ANGI Homeservices Inc. shareholders | $ (36,459) | $ (86,557) |
Basic and diluted loss per share attributable to ANGI Homeservices Inc. shareholders (USD per share) | $ (0.08) | $ (0.21) |
GOODWILL AND INTANGIBLE ASSET60
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF GOODWILL AND INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 770,226 | $ 170,990 | $ 150,630 |
Intangible assets with indefinite lives | 153,447 | 4,884 | |
Intangible assets with definite lives, net of accumulated amortization | 175,124 | 5,908 | |
Total goodwill and intangible assets, net | $ 1,098,797 | $ 181,782 |
GOODWILL AND INTANGIBLE ASSET61
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF GOODWILL BY REPORTING UNIT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Goodwill | ||
Balance at beginning of period | $ 170,990 | $ 150,630 |
Additions | 592,302 | 21,985 |
Impairment | 0 | 0 |
Foreign Exchange Translation | 6,934 | (1,625) |
Balance at end of period | 770,226 | 170,990 |
North America | ||
Goodwill | ||
Balance at beginning of period | 140,930 | 140,930 |
Additions | 555,045 | 0 |
Impairment | 0 | 0 |
Foreign Exchange Translation | 316 | 0 |
Balance at end of period | 696,291 | 140,930 |
Europe | ||
Goodwill | ||
Balance at beginning of period | 30,060 | 9,700 |
Additions | 37,257 | 21,985 |
Impairment | 0 | 0 |
Foreign Exchange Translation | 6,618 | (1,625) |
Balance at end of period | $ 73,935 | $ 30,060 |
GOODWILL AND INTANGIBLE ASSET62
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF INTANGIBLE ASSETS WITH DEFINITE LIVES (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Intangible assets with definite lives | ||
Gross Carrying Amount | $ 211,413 | $ 22,603 |
Accumulated Amortization | (36,289) | (16,695) |
Total | $ 175,124 | $ 5,908 |
Weighted-average useful life (years) | 3 years 9 months 18 days | 3 years 6 months |
Contractor relationships | ||
Intangible assets with definite lives | ||
Gross Carrying Amount | $ 99,497 | $ 1,830 |
Accumulated Amortization | (11,452) | (495) |
Total | $ 88,045 | $ 1,335 |
Weighted-average useful life (years) | 3 years | 4 years |
Technology | ||
Intangible assets with definite lives | ||
Gross Carrying Amount | $ 78,690 | $ 11,377 |
Accumulated Amortization | (14,127) | (7,834) |
Total | $ 64,563 | $ 3,543 |
Weighted-average useful life (years) | 5 years 7 months 6 days | 4 years 3 months 18 days |
Memberships | ||
Intangible assets with definite lives | ||
Gross Carrying Amount | $ 15,900 | |
Accumulated Amortization | (1,340) | |
Total | $ 14,560 | |
Weighted-average useful life (years) | 3 years | |
Customer lists and user base | ||
Intangible assets with definite lives | ||
Gross Carrying Amount | $ 12,788 | $ 4,136 |
Accumulated Amortization | (4,906) | (3,432) |
Total | $ 7,882 | $ 704 |
Weighted-average useful life (years) | 1 year | 1 year 9 months 18 days |
Trade names | ||
Intangible assets with definite lives | ||
Gross Carrying Amount | $ 4,538 | $ 5,260 |
Accumulated Amortization | (4,464) | (4,934) |
Total | $ 74 | $ 326 |
Weighted-average useful life (years) | 2 years 7 months 6 days | 2 years 10 months 24 days |
GOODWILL AND INTANGIBLE ASSET63
GOODWILL AND INTANGIBLE ASSETS - SCHEDULE OF EXPECTED AMORTIZATION OF INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2,018 | $ 60,657 | |
2,019 | 47,731 | |
2,020 | 37,477 | |
2,021 | 10,650 | |
2,022 | 10,650 | |
Thereafter | 7,959 | |
Total | $ 175,124 | $ 5,908 |
FAIR VALUE MEASUREMENTS AND F64
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS - SCHEDULE OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS (Details) - Fair Value on a Recurring Basis - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Assets: | ||
Cash equivalents | $ 195,902 | $ 28,064 |
Money market funds | ||
Assets: | ||
Cash equivalents | 189,207 | 28,064 |
Treasury discount notes | ||
Assets: | ||
Cash equivalents | 500 | |
Certificates of deposit | ||
Assets: | ||
Cash equivalents | 6,195 | |
Level 1 | ||
Assets: | ||
Cash equivalents | 189,707 | 28,064 |
Level 1 | Money market funds | ||
Assets: | ||
Cash equivalents | 189,207 | 28,064 |
Level 1 | Treasury discount notes | ||
Assets: | ||
Cash equivalents | 500 | |
Level 1 | Certificates of deposit | ||
Assets: | ||
Cash equivalents | 0 | |
Level 2 | ||
Assets: | ||
Cash equivalents | 6,195 | 0 |
Level 2 | Money market funds | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Level 2 | Treasury discount notes | ||
Assets: | ||
Cash equivalents | 0 | |
Level 2 | Certificates of deposit | ||
Assets: | ||
Cash equivalents | 6,195 | |
Level 3 | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Level 3 | Money market funds | ||
Assets: | ||
Cash equivalents | 0 | $ 0 |
Level 3 | Treasury discount notes | ||
Assets: | ||
Cash equivalents | 0 | |
Level 3 | Certificates of deposit | ||
Assets: | ||
Cash equivalents | $ 0 |
FAIR VALUE MEASUREMENTS AND F65
FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS - CARRYING VALUE AND FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Current portion of long-term debt—related party | $ (816) | $ (2,838) |
Long-term debt—related party, net | (1,997) | (47,000) |
Carrying value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Current portion of long term debt | (13,750) | 0 |
Long-term debt, net | (258,312) | 0 |
Current portion of long-term debt—related party | (816) | (2,838) |
Long-term debt—related party, net | (1,997) | (47,000) |
Fair value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Current portion of long term debt | (13,802) | 0 |
Long-term debt, net | (262,230) | 0 |
Current portion of long-term debt—related party | (837) | (2,776) |
Long-term debt—related party, net | $ (2,048) | $ (46,324) |
LONG-TERM DEBT - NARRATIVE (Det
LONG-TERM DEBT - NARRATIVE (Details) - Revolving Credit Facility - USD ($) $ in Millions | Nov. 01, 2017 | Dec. 31, 2017 |
Debt Instrument | ||
Maximum borrowing capacity | $ 275 | |
Debt Instrument, Term | 5 years | |
LIBOR | Minimum | ||
Debt Instrument | ||
Basis spread on variable rate (as a percent) | 2.00% | |
LIBOR | Maximum | ||
Debt Instrument | ||
Basis spread on variable rate (as a percent) | 3.38% | |
Quarterly payments for first three years | Base Rate | ||
Debt Instrument | ||
Basis spread on variable rate (as a percent) | 1.25% | |
Quarterly payments in fourth year | Base Rate | ||
Debt Instrument | ||
Basis spread on variable rate (as a percent) | 2.50% | |
Quarterly payments in fifth year | Base Rate | ||
Debt Instrument | ||
Basis spread on variable rate (as a percent) | 3.75% |
LONG-TERM DEBT - SCHEDULE OF LO
LONG-TERM DEBT - SCHEDULE OF LONG-TERM DEBT (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
Term Loan due November 1, 2022 | $ 275,000 | $ 0 |
Less: current portion of Term Loan | 13,750 | 0 |
Less: unamortized debt issuance costs | 2,938 | 0 |
Long-term debt, net | $ 258,312 | $ 0 |
LONG-TERM DEBT - SCHEDULE OF AG
LONG-TERM DEBT - SCHEDULE OF AGGREGATE CONTRACTUAL MATURITIES OF LONG-TERM DEBT (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Disclosure [Abstract] | ||
2,018 | $ 13,750 | |
2,019 | 13,750 | |
2,020 | 13,750 | |
2,021 | 27,500 | |
2,022 | 206,250 | |
Total long-term debt | 275,000 | $ 0 |
Less: current portion of Term Loan | 13,750 | 0 |
Less: unamortized debt issuance costs | 2,938 | 0 |
Long-term debt, net | $ 258,312 | $ 0 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) shares in Thousands | 12 Months Ended | |
Dec. 31, 2017voteshares | Dec. 31, 2016shares | |
Common Stock | ||
Class of Stock [Line Items] | ||
Votes per each share of stock | vote | 1 | |
Common stock outstanding (shares) | 62,818 | 0 |
Common stock reserved | 80,000 | |
Class B Convertible Common Stock | ||
Class of Stock [Line Items] | ||
Votes per each share of stock | vote | 10 | |
Common stock outstanding (shares) | 415,186 | 0 |
IAC | Class B Convertible Common Stock | ||
Class of Stock [Line Items] | ||
Common stock outstanding (shares) | 415,200 | |
Ownership interest (as a percent) | 86.90% | |
Common stock, voting rights | 98.50% |
ACCUMULATED OTHER COMPREHENSI70
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - NARRATIVE (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Income tax expense (benefit) | $ (49,106,000) | $ 11,834,000 | $ 1,758,000 |
Accumulated Other Comprehensive (Loss) Income | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Income tax expense (benefit) | $ 0 | $ 0 | $ 0 |
ACCUMULATED OTHER COMPREHENSI71
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Loss | |||
Balance at January 1 | $ 153,131 | ||
Other comprehensive income (loss) before reclassifications | 3,980 | $ (657) | $ (581) |
Amounts reclassified to earnings | (27) | 0 | 0 |
Net current period other comprehensive income (loss) | 3,953 | (657) | (581) |
Balance at December 31 | 993,346 | 153,131 | |
Accumulated Other Comprehensive (Loss) Income | |||
Accumulated Other Comprehensive Loss | |||
Balance at January 1 | (1,721) | (1,064) | (483) |
Balance at December 31 | $ 2,232 | $ (1,721) | $ (1,064) |
(LOSS) EARNINGS PER SHARE - COM
(LOSS) EARNINGS PER SHARE - COMPUTATION OF BASIC AND DILUTED EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |||||||||||
Net (loss) earnings | $ (104,527) | $ 10,631 | $ (3,996) | ||||||||
Net loss attributable to noncontrolling interests | 1,409 | 2,497 | 2,671 | ||||||||
Net (loss) earnings attributable to ANGI Homeservices Inc. shareholders | $ (58,224) | $ (71,761) | $ 254 | $ 26,613 | $ 2,720 | $ 5,075 | $ 6,010 | $ (677) | $ (103,118) | $ 13,128 | $ (1,325) |
Weighted average basic shares outstanding (shares) | 430,612 | 414,754 | 414,754 | ||||||||
Dilutive securities including stock appreciation rights, stock options, RSUs and subsidiary denominated equity awards (shares) | 0 | 0 | 0 | ||||||||
Weighted average diluted shares outstanding (shares) | 430,612 | 414,754 | 414,754 | ||||||||
(Loss) earnings per share attributable to ANGI Homeservices Inc. shareholders: | |||||||||||
Basic (loss) earnings per share (USD per share) | $ (0.12) | $ (0.17) | $ 0.06 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0 | $ (0.24) | $ 0.03 | $ 0 | |
Diluted (loss) earnings per share (USD per share) | $ (0.12) | $ (0.17) | $ 0.06 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0 | $ (0.24) | $ 0.03 | $ 0 | |
Potentially dilutive securities excluded from calculation of diluted earnings per share (shares) | 54,100 |
STOCK-BASED COMPENSATION - NARR
STOCK-BASED COMPENSATION - NARRATIVE (Details) $ / shares in Units, $ in Thousands | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Jun. 30, 2017USD ($) | Sep. 29, 2017shares | Dec. 31, 2017USD ($)plan$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Sep. 30, 2017shares |
Share-based Compensation Arrangement by Share-based Payment Award | ||||||||
Number of active stock-based compensation plans | plan | 1 | |||||||
Shares available for grant (in shares) | shares | 25,800,000 | 25,800,000 | 25,800,000 | |||||
Unrecognized compensation cost, net of estimated forfeitures | $ | $ 188,400 | $ 188,400 | $ 188,400 | |||||
Weighted average period over which cost is expected to be recognized (in years) | 2 years 4 months 24 days | |||||||
Tax benefit recognized related to stock-based compensation | $ | $ 71,100 | $ 3,400 | $ 3,000 | |||||
Intrinsic value of stock options exercised | $ | 100,700 | 21,700 | 200 | |||||
Incremental compensation cost | $ | $ 6,600 | 217,700 | ||||||
Incremental compensation cost from modification recognized in year of modification | $ | 93,400 | |||||||
Cash received from stock option exercises | $ | $ 1,653 | 0 | 0 | |||||
Aggregate number of shares required to settle equity awards at current estimated fair values held by subsidiary management | shares | 16,400,000 | |||||||
Cash remitted in withholding taxes on behalf of employees | $ | $ 171,300 | |||||||
Assumed witholding rate | 50.00% | |||||||
2017 Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||||
Stated term | 10 years | |||||||
Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||||
Vesting period | 4 years | |||||||
Tax benefit realized from stock option exercises | $ | $ 47,300 | $ 8,800 | $ 200 | |||||
Stock options granted in period (shares) | shares | 948,000 | 900,000 | ||||||
Weighted average grant date fair value of stock options granted (in usd per share) | $ / shares | $ 4.30 | $ 4.30 | $ 4.30 | |||||
Cash received from stock option exercises | $ | $ 1,700 | |||||||
Stock options outstanding (shares) | shares | 47,115,000 | 47,115,000 | 47,115,000 | |||||
RSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||||
Vesting period | 3 years | |||||||
Weighted average grant date fair value of RSUs (USD per share) | $ / shares | $ 12.58 | |||||||
Fair value of RSU's that vested during the period | $ | $ 19,200 | |||||||
Equity units granted (shares) | shares | 489,000 | |||||||
Stock Appreciation Rights (SARs) | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||||
Stock options granted in period (shares) | shares | 4,720,000 | 4,700,000 | 2,100,000 | 2,400,000 | ||||
Weighted average grant date fair value of stock options granted (in usd per share) | $ / shares | $ 8.24 | $ 8.24 | $ 8.24 | $ 3.13 | $ 1.34 | |||
Stock options outstanding (shares) | shares | 13,830,000 | 11,781,000 | ||||||
IAC Denominated Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||||
Vesting period | 4 years | |||||||
Stock options granted (in shares) | shares | 0 | 100,000 | 100,000 | |||||
Stock options outstanding (shares) | shares | 200,000 | 200,000 | 200,000 | |||||
Expiration period | 10 years | |||||||
PSUs | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award | ||||||||
Equity units granted (shares) | shares | 100,000 | 0 | 0 |
STOCK-BASED COMPENSATION - SCHE
STOCK-BASED COMPENSATION - SCHEDULE OF CHANGES IN OUTSTANDING STOCK OPTIONS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Sep. 29, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Weighted Average Remaining Contractual Term (In Years) | |||||
Balance at end of period | 7 years 1 month 6 days | ||||
Options exercisable | 4 years 8 months 12 days | ||||
Aggregate Intrinsic Value | |||||
Balance at end of period | $ 346,595 | $ 346,595 | |||
Options exercisable | $ 148,729 | $ 148,729 | |||
Stock Appreciation Rights (SARs) | |||||
Shares | |||||
Balance at beginning of period (shares) | 11,781 | 13,830 | 13,830 | ||
Granted (shares) | 4,720 | 4,700 | 2,100 | 2,400 | |
Exercised (shares) | (6,659) | ||||
Forfeited (shares) | (110) | ||||
Converted (shares) | 43,780 | ||||
Balance at end of period (shares) | 13,830 | ||||
Weighted Average Exercise Price | |||||
Balance at beginning of period (USD per share) | $ 9.69 | $ 3.97 | $ 3.97 | ||
Granted (USD per share) | 16.83 | ||||
Exercised (USD per share) | 2.87 | ||||
Forfeited (USD per share) | $ 9.86 | ||||
Converted (USD per share) | $ 2.61 | ||||
Balance at end of period (USD per share) | $ 3.97 | ||||
Stock Options | |||||
Shares | |||||
Granted (shares) | 948 | 900 | |||
Exercised (shares) | (1,948) | ||||
Forfeited (shares) | (331) | ||||
Converted (shares) | 5,290 | ||||
Expired (shares) | (624) | ||||
Balance at end of period (shares) | 47,115 | 47,115 | |||
Options exercisable (shares) | 17,358 | 17,358 | |||
Weighted Average Exercise Price | |||||
Granted (USD per share) | $ 11.32 | ||||
Exercised (USD per share) | 7.40 | ||||
Forfeited (USD per share) | 6.86 | ||||
Expired (USD per share) | 17.94 | ||||
Converted (USD per share) | 10.56 | ||||
Balance at end of period (USD per share) | 3.25 | $ 3.25 | |||
Options exercisable (USD per share) | $ 2.22 | $ 2.22 |
STOCK-BASED COMPENSATION - SC75
STOCK-BASED COMPENSATION - SCHEDULE OF INFORMATION FOR STOCK OPTIONS OUTSTANDING AND EXERCISABLE (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Awards Outstanding | |
Options outstanding (shares) | shares | 47,115 |
Weighted-average remaining contractual life | 7 years 1 month 6 days |
Weighted-average exercise price (USD per share) | $ 3.25 |
Awards Exercisable | |
Options exercisable (shares) | shares | 17,358 |
Weighted-average remaining contractual life | 4 years 8 months 12 days |
Weighted-average exercise price (USD per share) | $ 2.22 |
$0.01 to $3.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 26,143 |
Weighted-average remaining contractual life | 6 years |
Weighted-average exercise price (USD per share) | $ 1.32 |
Awards Exercisable | |
Options exercisable (shares) | shares | 15,462 |
Weighted-average remaining contractual life | 4 years 9 months 18 days |
Weighted-average exercise price (USD per share) | $ 0.99 |
Exercise price range, lower limit (USD per share) | 0.01 |
Exercise price range, upper limit (USD per share) | $ 3 |
$3.01 to $6.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 17,580 |
Weighted-average remaining contractual life | 9 years 1 month 6 days |
Weighted-average exercise price (USD per share) | $ 4.54 |
Awards Exercisable | |
Options exercisable (shares) | shares | 50 |
Weighted-average remaining contractual life | 6 years 6 months |
Weighted-average exercise price (USD per share) | $ 5.82 |
Exercise price range, lower limit (USD per share) | 3.01 |
Exercise price range, upper limit (USD per share) | $ 6 |
$6.01 to $9.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 1,210 |
Weighted-average remaining contractual life | 5 years 6 months |
Weighted-average exercise price (USD per share) | $ 7.66 |
Awards Exercisable | |
Options exercisable (shares) | shares | 711 |
Weighted-average remaining contractual life | 4 years 1 month 6 days |
Weighted-average exercise price (USD per share) | $ 7.68 |
Exercise price range, lower limit (USD per share) | 6.01 |
Exercise price range, upper limit (USD per share) | $ 9 |
$9.01 to $12.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 950 |
Weighted-average remaining contractual life | 9 years |
Weighted-average exercise price (USD per share) | $ 10.57 |
Awards Exercisable | |
Options exercisable (shares) | shares | 202 |
Weighted-average remaining contractual life | 6 years 3 months 18 days |
Weighted-average exercise price (USD per share) | $ 9.92 |
Exercise price range, lower limit (USD per share) | 9.01 |
Exercise price range, upper limit (USD per share) | $ 12 |
$12.01 to $15.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 718 |
Weighted-average remaining contractual life | 5 years 7 months 6 days |
Weighted-average exercise price (USD per share) | $ 13.12 |
Awards Exercisable | |
Options exercisable (shares) | shares | 420 |
Weighted-average remaining contractual life | 3 years |
Weighted-average exercise price (USD per share) | $ 13.34 |
Exercise price range, lower limit (USD per share) | 12.01 |
Exercise price range, upper limit (USD per share) | $ 15 |
$15.01 to $18.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 239 |
Weighted-average remaining contractual life | 6 months |
Weighted-average exercise price (USD per share) | $ 17.71 |
Awards Exercisable | |
Options exercisable (shares) | shares | 238 |
Weighted-average remaining contractual life | 4 months 24 days |
Weighted-average exercise price (USD per share) | $ 17.72 |
Exercise price range, lower limit (USD per share) | 15.01 |
Exercise price range, upper limit (USD per share) | $ 18 |
$18.01 to $21.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 192 |
Weighted-average remaining contractual life | 5 years 2 months 12 days |
Weighted-average exercise price (USD per share) | $ 19.88 |
Awards Exercisable | |
Options exercisable (shares) | shares | 192 |
Weighted-average remaining contractual life | 5 years 2 months 12 days |
Weighted-average exercise price (USD per share) | $ 19.88 |
Exercise price range, lower limit (USD per share) | 18.01 |
Exercise price range, upper limit (USD per share) | $ 21 |
$21.01 to $24.00 | |
Awards Outstanding | |
Options outstanding (shares) | shares | 83 |
Weighted-average remaining contractual life | 4 years 9 months 18 days |
Weighted-average exercise price (USD per share) | $ 22.51 |
Awards Exercisable | |
Options exercisable (shares) | shares | 83 |
Weighted-average remaining contractual life | 4 years 9 months 18 days |
Weighted-average exercise price (USD per share) | $ 22.51 |
Exercise price range, lower limit (USD per share) | 21.01 |
Exercise price range, upper limit (USD per share) | $ 24 |
STOCK-BASED COMPENSATION - SC76
STOCK-BASED COMPENSATION - SCHEDULE OF WEIGHTED-AVERAGE ASSUMPTIONS (Details) - Stock Options | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Expected volatility | 50.00% | 44.00% | 48.00% |
Risk-free interest rate | 2.00% | 0.80% | 1.20% |
Expected term | 5 years 6 months | 3 years 2 months 12 days | 3 years 8 months 12 days |
Dividend yield | 0.00% |
STOCK-BASED COMPENSATION - SC77
STOCK-BASED COMPENSATION - SCHEDULE OF OUTSTANDING UNVESTED RSUs (Details) - RSUs shares in Thousands | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Number of Shares | |
Balance at beginning of the period (shares) | shares | 4,957 |
Granted (shares) | shares | 489 |
Vested (shares) | shares | (1,574) |
Forfeited (shares) | shares | (977) |
Balance at end of the period (shares) | shares | 2,895 |
Weighted Average Grant Date Fair Value | |
Balance at beginning of the period (USD per share) | $ / shares | $ 12.46 |
Granted (USD per share) | $ / shares | 12.58 |
Vested (USD per share) | $ / shares | 12.46 |
Forfeited (USD per share) | $ / shares | 12.46 |
Balance at end of the period (USD per share) | $ / shares | $ 12.48 |
SEGMENT INFORMATION - SCHEDULE
SEGMENT INFORMATION - SCHEDULE OF SEGMENT REPORTING INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information | |||
Adjusted EBITDA | $ 39,163 | $ 44,546 | $ 16,713 |
Segment assets | 264,450 | 74,879 | |
Capital expenditures | 26,837 | 16,660 | 10,170 |
North America | |||
Segment Reporting Information | |||
Adjusted EBITDA | 50,182 | 50,088 | 18,184 |
Segment assets | 253,582 | 24,630 | |
Capital expenditures | 24,214 | 14,672 | 9,933 |
Europe | |||
Segment Reporting Information | |||
Adjusted EBITDA | (11,019) | (5,542) | (1,471) |
Segment assets | 10,868 | 50,249 | |
Capital expenditures | $ 2,623 | $ 1,988 | $ 237 |
SEGMENT INFORMATION - SCHEDUL79
SEGMENT INFORMATION - SCHEDULE OF REVENUE DISAGGREGATED BY SERVICE (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information | |||||||||||
Consumer connection revenue | $ 521,481 | $ 382,466 | $ 269,309 | ||||||||
Membership subscription revenue | 56,135 | 43,573 | 24,164 | ||||||||
Advertising and other revenue | 3,798 | 2,827 | 3,423 | ||||||||
Marketplace revenue | 581,414 | 428,866 | 296,896 | ||||||||
Revenue | $ 223,213 | $ 181,717 | $ 180,711 | $ 150,745 | $ 123,668 | $ 133,560 | $ 130,173 | $ 111,489 | 736,386 | 498,890 | 361,201 |
North America | |||||||||||
Segment Reporting Information | |||||||||||
Advertising and other revenue | 97,483 | 32,981 | 32,971 | ||||||||
Revenue | 678,897 | 461,847 | 329,867 | ||||||||
Europe | |||||||||||
Segment Reporting Information | |||||||||||
Consumer connection revenue | 40,009 | 28,124 | 23,298 | ||||||||
Membership subscription revenue | 16,596 | 7,936 | 6,921 | ||||||||
Advertising and other revenue | 884 | 983 | 1,115 | ||||||||
Revenue | $ 57,489 | $ 37,043 | $ 31,334 |
SEGMENT INFORMATION - SCHEDUL80
SEGMENT INFORMATION - SCHEDULE OF REVENUE AND LONG-LIVED ASSETS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue and Long-lived Assets by Geography | |||||||||||
Revenue | $ 223,213 | $ 181,717 | $ 180,711 | $ 150,745 | $ 123,668 | $ 133,560 | $ 130,173 | $ 111,489 | $ 736,386 | $ 498,890 | $ 361,201 |
Property and equipment, net | 53,292 | 23,645 | 53,292 | 23,645 | |||||||
United States | |||||||||||
Revenue and Long-lived Assets by Geography | |||||||||||
Revenue | 672,159 | 461,372 | 329,117 | ||||||||
Property and equipment, net | 49,356 | 21,775 | 49,356 | 21,775 | |||||||
All other countries | |||||||||||
Revenue and Long-lived Assets by Geography | |||||||||||
Revenue | 64,227 | 37,518 | $ 32,084 | ||||||||
Property and equipment, net | $ 3,936 | $ 1,870 | $ 3,936 | $ 1,870 |
SEGMENT INFORMATION - SCHEDUL81
SEGMENT INFORMATION - SCHEDULE OF RECONCILIATION OF ADJUSTED EBITDA TO OPERATING INCOME (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting, Other Significant Reconciling Item | |||||||||||
Operating income (loss) | $ (33,918) | $ (112,505) | $ (2,836) | $ 1,388 | $ 6,216 | $ 8,843 | $ 9,513 | $ (514) | $ (147,871) | $ 24,058 | $ (1,568) |
Stock-based compensation expense | 149,230 | 8,916 | 7,853 | ||||||||
Depreciation | 14,543 | 8,419 | 6,593 | ||||||||
Amortization of intangibles | 23,261 | 3,153 | 3,835 | ||||||||
Adjusted EBITDA | 39,163 | 44,546 | 16,713 | ||||||||
Interest expense—third party | (1,765) | 0 | 0 | ||||||||
Interest Expense, Related Party | 5,971 | 894 | 272 | ||||||||
Other income (expense), net | 1,974 | (699) | (398) | ||||||||
(Loss) earnings before income taxes | (153,633) | 22,465 | (2,238) | ||||||||
Taxes | 49,106 | (11,834) | (1,758) | ||||||||
Net (loss) earnings | (104,527) | 10,631 | (3,996) | ||||||||
Net loss attributable to noncontrolling interests | 1,409 | 2,497 | 2,671 | ||||||||
Net (loss) earnings attributable to ANGI Homeservices Inc. shareholders | $ (58,224) | $ (71,761) | $ 254 | $ 26,613 | $ 2,720 | $ 5,075 | $ 6,010 | $ (677) | (103,118) | 13,128 | (1,325) |
North America | |||||||||||
Segment Reporting, Other Significant Reconciling Item | |||||||||||
Operating income (loss) | (128,483) | 32,464 | 2,311 | ||||||||
Stock-based compensation expense | 147,574 | 7,126 | 6,758 | ||||||||
Depreciation | 13,243 | 7,996 | 5,768 | ||||||||
Amortization of intangibles | 17,848 | 2,502 | 3,347 | ||||||||
Adjusted EBITDA | 50,182 | 50,088 | 18,184 | ||||||||
Europe | |||||||||||
Segment Reporting, Other Significant Reconciling Item | |||||||||||
Operating income (loss) | (19,388) | (8,406) | (3,879) | ||||||||
Stock-based compensation expense | 1,656 | 1,790 | 1,095 | ||||||||
Depreciation | 1,300 | 423 | 825 | ||||||||
Amortization of intangibles | 5,413 | 651 | 488 | ||||||||
Adjusted EBITDA | $ (11,019) | $ (5,542) | $ (1,471) |
SEGMENT INFORMATION - SCHEDUL82
SEGMENT INFORMATION - SCHEDULE OF RECONCILIATION OF SEGMENT ASSETS TO TOTAL ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Segment Reporting, Asset Reconciling Item | |||
Segment assets | $ 264,450 | $ 74,879 | |
Property and equipment, net | 53,292 | 23,645 | |
Goodwill | 770,226 | 170,990 | $ 150,630 |
Indefinite-lived intangible assets | 153,447 | 4,884 | |
Definite-lived intangible assets, net | 175,124 | 5,908 | |
Assets before deferred tax assets | 1,416,539 | 280,306 | |
Add: Deferred tax assets | 50,723 | 15,211 | |
TOTAL ASSETS | 1,467,262 | 295,517 | |
North America | |||
Segment Reporting, Asset Reconciling Item | |||
Segment assets | 253,582 | 24,630 | |
Property and equipment, net | 49,487 | 21,775 | |
Goodwill | 696,291 | 140,930 | 140,930 |
Indefinite-lived intangible assets | 140,034 | 600 | |
Definite-lived intangible assets, net | 169,054 | 2,454 | |
Assets before deferred tax assets | 1,308,448 | 190,389 | |
Europe | |||
Segment Reporting, Asset Reconciling Item | |||
Segment assets | 10,868 | 50,249 | |
Property and equipment, net | 3,805 | 1,870 | |
Goodwill | 73,935 | 30,060 | $ 9,700 |
Indefinite-lived intangible assets | 13,413 | 4,284 | |
Definite-lived intangible assets, net | 6,070 | 3,454 | |
Assets before deferred tax assets | $ 108,091 | $ 89,917 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - SCHEDULE OF FUTURE MINIMUM PAYMENTS UNDER OPERATING LEASE AGREEMENTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Future Minimum Payments Under Operating Lease Agreements | |||
2,018 | $ 11,090 | ||
2,019 | 13,728 | ||
2,020 | 10,859 | ||
2,021 | 9,578 | ||
2,022 | 8,306 | ||
Thereafter | 32,820 | ||
Total | 86,381 | ||
Expenses charged to operations under operating lease agreements | $ 8,900 | $ 6,200 | $ 5,800 |
Period of most significant operating leases (in years) | 10 years 6 months | ||
Percentage of most significant operating leases | 58.00% |
COMMITMENTS AND CONTINGENCIES84
COMMITMENTS AND CONTINGENCIES - SCHEDULE OF COMMERCIAL COMMITMENTS OUTSTANDING (Details) - Purchase obligations $ in Thousands | Dec. 31, 2017USD ($) |
Other Commitments | |
Less than 1 Year | $ 831 |
1 to 3 years | 650 |
Total | $ 1,481 |
SUPPLEMENTAL CASH FLOW INFORM85
SUPPLEMENTAL CASH FLOW INFORMATION - NARRATIVE (Details) - Common Stock - USD ($) shares in Thousands, $ in Thousands | Dec. 31, 2017 | Sep. 29, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | |||
Common stock issued (shares) | 62,818 | 0 | |
Common stock | $ 63 | $ 0 | |
Angie's List | |||
Class of Stock [Line Items] | |||
Common stock issued (shares) | 61,300 | ||
Common stock | $ 763,684 |
SUPPLEMENTAL CASH FLOW INFORM86
SUPPLEMENTAL CASH FLOW INFORMATION - SCHEDULE OF SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Supplemental Cash Flow Information [Abstract] | |||
Interest—related party | $ 6,169 | $ 417 | $ 262 |
Income tax payments, including amounts paid to IAC for ANGI Homeservices share of IAC's consolidated tax liability | 1,700 | 8,820 | 3,424 |
Income tax refunds | $ (402) | $ (263) | $ (657) |
RELATED PARTY TRANSACTIONS - NA
RELATED PARTY TRANSACTIONS - NARRATIVE (Details) - IAC $ in Thousands, £ in Millions, shares in Millions | Oct. 14, 2016USD ($) | Aug. 29, 2013USD ($) | Dec. 31, 2017USD ($)shares | Dec. 31, 2017GBP (£)shares | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 29, 2017USD ($)intercompany_note | Mar. 20, 2017USD ($)subsidiary | Mar. 20, 2017GBP (£)subsidiary | Feb. 07, 2017GBP (£) |
Related Party Transaction [Line Items] | ||||||||||
Allocated general and administrative costs from related party activities | $ 4,789 | $ 4,247 | $ 2,598 | |||||||
Long-term debt - related party | 2,813 | 49,838 | ||||||||
Notes Payable | Promissory note due October 14, 2023 | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Long-term debt - related party | $ 42,000 | 0 | 42,000 | |||||||
Proceeds from related party debt | $ 11,400 | |||||||||
Long-term debt, interest rate | 11.00% | |||||||||
Notes Payable | Promissory Note Due March 20, 2024 (Note A) | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Long-term debt - related party | £ | £ 21 | |||||||||
Long-term debt, interest rate | 6.50% | 6.50% | ||||||||
Number of foreign subsidiaries of related party issued long-term debt | subsidiary | 2 | 2 | ||||||||
Notes Payable | Promissory Note Due March 20, 2047 (Note B) | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Long-term debt - related party | $ 15,500 | |||||||||
Long-term debt, interest rate | 7.00% | 7.00% | ||||||||
Number of foreign subsidiaries of related party issued long-term debt | subsidiary | 2 | 2 | ||||||||
Notes Payable | Promissory Note Due February 7, 2024 | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Long-term debt - related party | £ | £ 8.4 | |||||||||
Long-term debt, interest rate | 6.875% | |||||||||
Notes Payable | Promissory note due August 29, 2018 | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Long-term debt - related party | $ 5,000 | 0 | $ 5,000 | |||||||
Basis spread on variable rate | 2.00% | |||||||||
Notes Payable | Promissory Note Due December 31, 2020 | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Increase (decrease) in long-term debt - related parties | $ (2,800) | £ (2.4) | ||||||||
Intercompany Notes | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of related party debt instruments | intercompany_note | 2 | |||||||||
Payoff Intercompany Note | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Current notes receivable, related parties | $ 61,500 | |||||||||
Working Capital Intercompany Note | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Current notes receivable, related parties | $ 15,000 | |||||||||
Services Agreement | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Term of related party agreement | 1 year | 1 year | ||||||||
Automatic renewal periods for related party agreement | 1 year | 1 year | ||||||||
Payments received from related parties | $ 1,700 | |||||||||
Amounts due to related party | $ 400 | |||||||||
Employee Matters Agreement | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Voting interest (as a percent) | 80.00% | |||||||||
Shares received from related party pursuant to employee matters agreement (in shares) | shares | 0.4 | 0.4 | ||||||||
Transaction Related Costs | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Amounts due to related party | $ 2,000 |
RELATED PARTY TRANSACTIONS - SC
RELATED PARTY TRANSACTIONS - SCHEDULE OF RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||
Taxes | $ 49,106 | $ (11,834) | $ (1,758) |
Interest income from related party | 700 | ||
Net (increase) decrease in IAC’s investment in HomeAdvisor | 46,339 | 10,300 | (3,008) |
IAC | |||
Related Party Transaction [Line Items] | |||
Cash transfers (from) to IAC related to its centrally managed U.S. treasury management function, acquisitions and cash expenses paid by IAC on behalf of HomeAdvisor, net | (80,368) | (363) | 8,801 |
Taxes | 38,162 | (5,968) | (3,281) |
Interest income from related party | 656 | 278 | 86 |
Allocation of general and administrative expense | (4,789) | (4,247) | (2,598) |
Net (increase) decrease in IAC’s investment in HomeAdvisor | $ (46,339) | $ (10,300) | $ 3,008 |
RELATED PARTY TRANSACTIONS - LO
RELATED PARTY TRANSACTIONS - LONG-TERM DEBT (Details) - IAC - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Oct. 14, 2016 | Aug. 29, 2013 |
Related Party Transaction [Line Items] | ||||
Total long-term debt—related party | $ 2,813 | $ 49,838 | ||
Less: Current portion of long-term debt—related party | 816 | 2,838 | ||
Total long-term debt—related party, net | 1,997 | 47,000 | ||
Other | ||||
Related Party Transaction [Line Items] | ||||
Total long-term debt—related party | 2,813 | 2,838 | ||
Promissory note due October 14, 2023 | Notes Payable | ||||
Related Party Transaction [Line Items] | ||||
Total long-term debt—related party | 0 | 42,000 | $ 42,000 | |
Promissory note due August 29, 2018 | Notes Payable | ||||
Related Party Transaction [Line Items] | ||||
Total long-term debt—related party | $ 0 | $ 5,000 | $ 5,000 |
RELATED PARTY TRANSACTIONS - 90
RELATED PARTY TRANSACTIONS - LONG-TERM DEBT MATURITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Related Party Transaction [Line Items] | ||
2,018 | $ 13,750 | |
2,019 | 13,750 | |
2,020 | 13,750 | |
IAC | ||
Related Party Transaction [Line Items] | ||
2,018 | 816 | |
2,019 | 1,495 | |
2,020 | 502 | |
Total long-term debt—related party | $ 2,813 | $ 49,838 |
BENEFIT PLANS (Details)
BENEFIT PLANS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
HomeAdvisor | |||
Defined Contribution Plan Disclosure | |||
Employee contribution limit per calendar year (as a percent of pre-tax earnings) | 50.00% | ||
Employer contribution limit per calendar year (as a percent of compensation) | 3.00% | ||
HomeAdvisor | United States | |||
Defined Contribution Plan Disclosure | |||
Defined contribution plan contributions | $ 3.5 | $ 2.7 | $ 1.9 |
HomeAdvisor | All Other Countries | |||
Defined Contribution Plan Disclosure | |||
Defined contribution plan contributions | 0.3 | $ 0.1 | $ 0.2 |
Angie's List | |||
Defined Contribution Plan Disclosure | |||
Defined contribution plan contributions | $ 0.6 | ||
Employer contribution limit per calendar year (as a percent of compensation) | 3.00% |
CONSOLIDATED AND COMBINED FIN92
CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS - SCHEDULE OF OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Other current assets: | ||
Prepaid expenses | $ 10,937 | $ 6,456 |
Other | 1,835 | 2,283 |
Other current assets | $ 12,772 | $ 8,739 |
CONSOLIDATED AND COMBINED FIN93
CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS - SCHEDULE OF PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, gross | $ 77,660 | $ 41,722 |
Accumulated depreciation and amortization | (24,368) | (18,077) |
Property and equipment, net of accumulated depreciation and amortization | 53,292 | 23,645 |
Computer equipment and capitalized software | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, gross | 41,853 | 27,309 |
Buildings and leasehold improvements | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, gross | 13,984 | 6,075 |
Furniture and other equipment | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, gross | 6,222 | 3,140 |
Projects in progress | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, gross | 12,801 | $ 5,198 |
Land | ||
Property and equipment, net of accumulated depreciation and amortization : | ||
Property and equipment, gross | $ 2,800 |
CONSOLIDATED AND COMBINED FIN94
CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS - SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accrued expenses and other current liabilities: | ||
Accrued employee compensation and benefits | $ 30,354 | $ 14,379 |
Accrued advertising expense | 17,243 | 8,209 |
Other | 27,574 | 11,850 |
Accrued expenses and other current liabilities | $ 75,171 | $ 34,438 |
CONSOLIDATED AND COMBINED FIN95
CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS - OTHER INCOME (EXPENSE), NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Other income (expense), net | $ 1,974 | $ (699) | $ (398) |
Foreign currency exchange gains | 900 | ||
Interest income from related party | 700 | ||
Interest income | $ 500 |
TRANSACTION AND INTEGRATION R96
TRANSACTION AND INTEGRATION RELATED COSTS IN CONNECTION WITH THE COMBINATION - NARRATIVE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Business Acquisition | |||
Stock-based compensation expense | $ 149,230 | $ 8,916 | $ 7,853 |
Angie's List | |||
Business Acquisition | |||
Transaction and integration related costs | 44,101 | ||
Write-off due to deferred revenue | 7,800 | ||
Stock-based compensation expense | $ 122,066 |
TRANSACTION AND INTEGRATION R97
TRANSACTION AND INTEGRATION RELATED COSTS IN CONNECTION WITH THE COMBINATION - SUMMARY (Details) - USD ($) $ in Thousands | Sep. 29, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Business Acquisition | ||||
Stock-based compensation expense | $ 149,230 | $ 8,916 | $ 7,853 | |
Cost of revenue | ||||
Business Acquisition | ||||
Stock-based compensation expense | 19 | |||
Selling and marketing expense | ||||
Business Acquisition | ||||
Stock-based compensation expense | 25,763 | 863 | 545 | |
General and administrative expense | ||||
Business Acquisition | ||||
Stock-based compensation expense | 107,662 | 6,804 | 6,137 | |
Product development expense | ||||
Business Acquisition | ||||
Stock-based compensation expense | 15,786 | $ 1,249 | $ 1,171 | |
Angie's List | ||||
Business Acquisition | ||||
Transaction and integration related costs | 44,101 | |||
Stock-based compensation expense | 122,066 | |||
Total | 166,167 | |||
Charges incurred | 44,101 | |||
Payments made | $ (1,900) | (35,621) | ||
Accrual as of December 31 | 8,480 | |||
Angie's List | Cost of revenue | ||||
Business Acquisition | ||||
Transaction and integration related costs | 0 | |||
Stock-based compensation expense | 0 | |||
Total | 0 | |||
Angie's List | Selling and marketing expense | ||||
Business Acquisition | ||||
Transaction and integration related costs | 7,430 | |||
Stock-based compensation expense | 24,416 | |||
Total | 31,846 | |||
Angie's List | General and administrative expense | ||||
Business Acquisition | ||||
Transaction and integration related costs | 36,120 | |||
Stock-based compensation expense | 83,420 | |||
Total | 119,540 | |||
Angie's List | Product development expense | ||||
Business Acquisition | ||||
Transaction and integration related costs | 551 | |||
Stock-based compensation expense | 14,230 | |||
Total | $ 14,781 |
QUARTERLY RESULTS (UNAUDITED)98
QUARTERLY RESULTS (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Selected Quarterly Financial Information [Abstract] | |||||||||||
Revenue | $ 223,213 | $ 181,717 | $ 180,711 | $ 150,745 | $ 123,668 | $ 133,560 | $ 130,173 | $ 111,489 | $ 736,386 | $ 498,890 | $ 361,201 |
Cost of revenue | 11,682 | 7,999 | 7,562 | 6,830 | 6,293 | 6,826 | 6,745 | 5,994 | 34,073 | 25,858 | 22,936 |
Operating income (loss) | (33,918) | (112,505) | (2,836) | 1,388 | 6,216 | 8,843 | 9,513 | (514) | (147,871) | 24,058 | (1,568) |
Net earnings (loss) | (58,231) | (72,158) | (25) | 25,887 | 2,056 | 4,468 | 5,351 | (1,244) | |||
Net earnings (loss) attributable to ANGI Homeservices Inc. shareholders | $ (58,224) | $ (71,761) | $ 254 | $ 26,613 | $ 2,720 | $ 5,075 | $ 6,010 | $ (677) | $ (103,118) | $ 13,128 | $ (1,325) |
(Loss) earnings per share attributable to ANGI Homeservices Inc. shareholders: | |||||||||||
Basic (loss) earnings per share (USD per share) | $ (0.12) | $ (0.17) | $ 0.06 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0 | $ (0.24) | $ 0.03 | $ 0 | |
Diluted (loss) earnings per share (USD per share) | $ (0.12) | $ (0.17) | $ 0.06 | $ 0.01 | $ 0.01 | $ 0.01 | $ 0 | $ (0.24) | $ 0.03 | $ 0 | |
Stock-based compensation expense | $ 149,230 | $ 8,916 | $ 7,853 | ||||||||
HomeAdvisor | |||||||||||
(Loss) earnings per share attributable to ANGI Homeservices Inc. shareholders: | |||||||||||
Stock-based compensation expense | $ 15,600 | $ 59,400 | |||||||||
Angie's List | |||||||||||
(Loss) earnings per share attributable to ANGI Homeservices Inc. shareholders: | |||||||||||
Transaction costs | 13,800 | $ 17,000 | $ 13,800 | ||||||||
Write-off due to deferred revenue | $ 7,600 |
SCHEDULE II - VALUATION AND Q99
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowance for doubtful accounts and revenue reserves | |||
Movement in Valuation Allowances and Reserves | |||
Balance at Beginning of Period | $ 9,177 | $ 8,171 | $ 6,861 |
Charges to Earnings | 27,514 | 17,425 | 13,234 |
Charges to Other Accounts | 271 | (56) | (453) |
Deductions | (27,699) | (16,363) | (11,471) |
Balance at End of Period | 9,263 | 9,177 | 8,171 |
Deferred tax valuation allowance | |||
Movement in Valuation Allowances and Reserves | |||
Balance at Beginning of Period | 14,180 | 12,696 | 11,249 |
Charges to Earnings | 42,310 | 2,384 | 2,248 |
Charges to Other Accounts | 5,073 | (900) | (801) |
Deductions | 0 | 0 | 0 |
Balance at End of Period | $ 61,563 | $ 14,180 | $ 12,696 |