Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2022 | May 05, 2022 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | Alight, Inc. / Delaware | |
Entity Central Index Key | 0001809104 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Title of 12(b) Security | Class A Common Stock, par value $0.0001 per share | |
Trading Symbol | ALIT | |
Security Exchange Name | NYSE | |
Entity File Number | 001-39299 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 86-1849232 | |
Entity Address, Address Line One | 4 Overlook Point | |
Entity Address, City or Town | Lincolnshire | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60069 | |
City Area Code | 224 | |
Local Phone Number | 737-7000 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 465,225,352 | |
Class B-1 Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 4,990,453 | |
Class B-2 Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 4,990,453 | |
Class V Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 76,220,431 | |
Class Z-A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 5,046,819 | |
Class Z-B-1 Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 274,379 | |
Class Z-B-2 Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 274,379 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Current Assets | ||
Cash and cash equivalents | $ 326 | $ 372 |
Receivables, net | 546 | 515 |
Other current assets | 254 | 302 |
Total Current Assets Before Fiduciary Assets | 1,126 | 1,189 |
Fiduciary assets | 1,607 | 1,280 |
Total Current Assets | 2,733 | 2,469 |
Goodwill | 3,627 | 3,638 |
Intangible assets, net | 4,090 | 4,170 |
Fixed assets, net | 257 | 236 |
Deferred tax assets, net | 4 | 3 |
Other assets | 510 | 472 |
Total Assets | 11,221 | 10,988 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 319 | 406 |
Current portion of long term debt | 40 | 38 |
Other current liabilities | 394 | 401 |
Total Current Liabilities Before Fiduciary Liabilities | 753 | 845 |
Fiduciary liabilities | 1,607 | 1,280 |
Total Current Liabilities | 2,360 | 2,125 |
Deferred tax liabilities | 52 | 36 |
Long term debt | 2,818 | 2,830 |
Tax receivable agreement | 574 | 581 |
Financial instruments | 122 | 135 |
Other liabilities | 311 | 353 |
Total Liabilities | 6,237 | 6,060 |
Commitments and Contingencies (Note 19) | ||
Stockholders' Equity | ||
Additional paid-in-capital | 4,267 | 4,228 |
Retained deficit | (107) | (96) |
Accumulated other comprehensive loss | 44 | 8 |
Total Alight, Inc. Equity | 4,204 | 4,140 |
Noncontrolling interest | 780 | 788 |
Total Stockholders' Equity | 4,984 | 4,928 |
Total Liabilities and Stockholders' Equity | $ 11,221 | $ 10,988 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2022 | Jul. 02, 2021 |
Class A Common Stock | ||
Common stock, par value | $ 0.0001 | |
Common stock, shares authorized | 1,000,000,000 | |
Common stock, shares issued | 465,225,352 | |
Common stock, shares outstanding | 465,225,352 | |
Class B Common Stock | ||
Common stock, par value | $ 0.0001 | |
Common stock, shares authorized | 20,000,000 | |
Common stock, shares issued | 9,980,906 | |
Common stock, shares outstanding | 9,980,906 | |
Class V Common Stock | ||
Common stock, par value | $ 0.0001 | |
Common stock, shares authorized | 175,000,000 | |
Common stock, shares issued | 76,220,431 | |
Common stock, shares outstanding | 76,220,431 | |
Class Z Common Stock | ||
Common stock, par value | $ 0.0001 | |
Common stock, shares authorized | 12,900,000 | |
Common stock, shares issued | 5,595,577 | 8,671,507 |
Common stock, shares outstanding | 5,595,577 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Revenue | $ 725 | $ 689 |
Cost of services, exclusive of depreciation and amortization | 491 | |
Depreciation and amortization | 11 | |
Gross Profit | 223 | |
Operating Expenses | ||
Selling, general and administrative | 140 | |
Depreciation and intangible amortization | 85 | |
Total operating expenses | 225 | |
Operating (Loss) Income | (2) | 46 |
Other Expense | ||
Gain from change in fair value of financial instruments | (13) | |
Gain from change in fair value of tax receivable agreement | (5) | |
Interest expense | 29 | 62 |
Other (income) expense, net | (1) | 8 |
Total other expense, net | 10 | |
Loss Before Income Tax Expense (Benefit) | (12) | (24) |
Income tax expense (benefit) | 1 | |
Net Loss | (13) | |
Net loss attributable to noncontrolling interests | (2) | |
Net Loss Attributable to Alight, Inc. | $ (11) | |
Earnings Per Share | ||
Basic net loss per share | $ (0.02) | |
Diluted net loss per share | $ (0.02) | |
Other comprehensive income, net of tax: | ||
Change in fair value of derivatives | $ 47 | |
Foreign currency translation adjustments | (3) | |
Total other comprehensive income, net of tax: | 44 | |
Comprehensive Income Before Noncontrolling Interests | 31 | |
Comprehensive income attributable to noncontrolling interests | 6 | |
Comprehensive Income Attributable to Alight, Inc. | $ 25 | |
Alight Holdings | ||
Revenue | 689 | |
Cost of services, exclusive of depreciation and amortization | 452 | |
Depreciation and amortization | 19 | |
Gross Profit | 218 | |
Operating Expenses | ||
Selling, general and administrative | 117 | |
Depreciation and intangible amortization | 55 | |
Total operating expenses | 172 | |
Operating (Loss) Income | 46 | |
Other Expense | ||
Interest expense | 62 | |
Other (income) expense, net | 8 | |
Total other expense, net | 70 | |
Loss Before Income Tax Expense (Benefit) | (24) | |
Income tax expense (benefit) | (3) | |
Net Loss | (21) | |
Net Loss Attributable to Alight, Inc. | (21) | |
Other comprehensive income, net of tax: | ||
Change in fair value of derivatives | 17 | |
Foreign currency translation adjustments | 4 | |
Total other comprehensive income, net of tax: | $ 21 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - 3 months ended Mar. 31, 2022 - USD ($) $ in Millions | Total | Additional Paid-in Capital | Retained Deficit | Accumulated Other Comprehensive Income | Total Alight, Inc. Equity | Noncontrolling Interest |
Balance at Dec. 31, 2021 | $ 4,928 | $ 4,228 | $ (96) | $ 8 | $ 4,140 | $ 788 |
Net loss | (13) | (11) | (11) | (2) | ||
Other comprehensive income, net | 44 | 36 | 36 | 8 | ||
Measurement period adjustment | (1) | (1) | ||||
Conversion of noncontrolling interest | (6) | 7 | 7 | (13) | ||
Share-based compensation expense | 33 | 33 | 33 | |||
Shares vested, net of shares withheld in lieu of taxes | (1) | (1) | (1) | |||
Balance at Mar. 31, 2022 | $ 4,984 | $ 4,267 | $ (107) | $ 44 | $ 4,204 | $ 780 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Members' Equity (Unaudited) - USD ($) $ in Millions | Total | Common Class A | Common Class A-1 Units | Common Class B Units | Accumulated Other Comprehensive (Loss) Income |
Balance at Dec. 31, 2020 | $ 683 | $ 699 | $ 12 | $ 14 | $ (42) |
Balance, units at Dec. 31, 2020 | 123,700 | 1,800 | 1,736 | ||
Comprehensive (loss) income, net of tax | $ (21) | 21 | |||
Restricted share units vested, net of units withheld in lieu of taxes, units | 1 | 50 | |||
Unit repurchases | (2) | $ (1) | $ (1) | ||
Unit repurchases, units | (75) | (89) | |||
Share-based compensation expense | 2 | $ 2 | |||
Balance at Mar. 31, 2021 | 683 | $ 678 | $ 11 | $ 15 | (21) |
Balance, units at Mar. 31, 2021 | 123,700 | 1,726 | 1,697 | ||
Balance at Dec. 31, 2021 | (8) | ||||
Comprehensive (loss) income, net of tax | 25 | ||||
Share-based compensation expense | $ 33 | ||||
Balance at Mar. 31, 2022 | $ (44) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash flows from operating activities | ||
Net loss | $ (13) | |
Adjustments to reconcile net loss to net cash provided by operations: | ||
Depreciation | 17 | $ 24 |
Intangible amortization expense | 79 | 50 |
Noncash lease expense | 7 | |
Financing fee and premium amortization | (1) | |
Share-based compensation expense | 33 | 2 |
Gain from change in fair value of financial instruments | (13) | |
Gain from change in fair value of tax receivable agreement | (5) | |
Other | 3 | |
Change in assets and liabilities: | ||
Receivables | (37) | |
Accounts payable and accrued liabilities | (82) | |
Other assets and liabilities | 31 | |
Cash provided by operating activities | 19 | |
Cash flows from investing activities | ||
Capital expenditures | (41) | |
Cash used for investing activities | (41) | |
Cash flows from financing activities | ||
Net increase in fiduciary liabilities | 327 | |
Borrowings from banks | 54 | |
Financing fees | (3) | |
Repayments to banks | (60) | |
Principal payments on finance lease obligations | (8) | |
Settlements of interest rate swaps | (4) | |
Tax payment for shares/units withheld in lieu of taxes | (1) | |
Cash provided by financing activities | 305 | |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (2) | |
Net increase in cash, cash equivalents and restricted cash | 281 | |
Cash, cash equivalents and restricted cash at beginning of period | 1,652 | |
Cash, cash equivalents and restricted cash at end of period | 1,933 | |
Reconciliation of cash, cash equivalents, and restricted cash to the Consolidated Balance Sheets | ||
Cash and cash equivalents | 326 | |
Restricted cash included in fiduciary assets | 1,607 | |
Total cash, cash equivalents and restricted cash | 1,933 | |
Supplemental disclosures: | ||
Interest paid | 27 | |
Income taxes paid | 1 | |
Supplemental disclosure of non-cash financing activities: | ||
Fixed asset additions acquired through finance leases | 2 | |
Right of use asset additions acquired through operating leases | $ 1 | |
Alight Holdings | ||
Cash flows from operating activities | ||
Net loss | (21) | |
Adjustments to reconcile net loss to net cash provided by operations: | ||
Depreciation | 24 | |
Intangible amortization expense | 50 | |
Noncash lease expense | 4 | |
Financing fee and premium amortization | 5 | |
Share-based compensation expense | 2 | |
Other | 1 | |
Change in assets and liabilities: | ||
Receivables | 52 | |
Accounts payable and accrued liabilities | (31) | |
Other assets and liabilities | (47) | |
Cash provided by operating activities | 39 | |
Cash flows from investing activities | ||
Capital expenditures | (27) | |
Cash used for investing activities | (27) | |
Cash flows from financing activities | ||
Net increase in fiduciary liabilities | 179 | |
Members' equity unit repurchase | (2) | |
Borrowings from banks | 54 | |
Repayments to banks | (62) | |
Principal payments on finance lease obligations | (6) | |
Settlements of interest rate swaps | (7) | |
Contingent consideration payments | (1) | |
Cash provided by financing activities | 155 | |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 1 | |
Net increase in cash, cash equivalents and restricted cash | 168 | |
Cash, cash equivalents and restricted cash at beginning of period | 1,536 | |
Cash, cash equivalents and restricted cash at end of period | 1,704 | |
Reconciliation of cash, cash equivalents, and restricted cash to the Consolidated Balance Sheets | ||
Cash and cash equivalents | 495 | |
Restricted cash included in fiduciary assets | 1,209 | |
Total cash, cash equivalents and restricted cash | 1,704 | |
Supplemental disclosures: | ||
Interest paid | 31 | |
Income taxes paid | 3 | |
Supplemental disclosure of non-cash financing activities: | ||
Fixed asset additions acquired through finance leases | 1 | |
Right of use asset additions acquired through operating leases | $ (3) |
Basis of Presentation and Natur
Basis of Presentation and Nature of Business | 3 Months Ended |
Mar. 31, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation and Nature of Business | 1. Basis of Presentation and Nature of Business Foley Trasimene Acquisition Corp. (“FTAC”) was incorporated in Delaware on March 26, 2020 . FTAC was formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. On July 2, 2021 (the “Closing Date”), FTAC completed the business combination (the “Business Combination”) with Alight Holding Company, LLC (f/k/a Tempo Holding Company, LLC) (“Alight Holdings” or the “Predecessor”) contemplated by the Business Combination Agreement (as amended and restated as of April 29, 2021) between FTAC, Alight Holdings and other interested parties (the “Business Combination Agreement”). On the Closing Date, pursuant to the Business Combination Agreement, FTAC became a wholly owned subsidiary of Alight, Inc. (“Alight”, “the Company”, “we” “us” “our” or the “Successor”) and was renamed Alight Group, Inc. As a result of the Business Combination, and by virtue of such series of mergers and related transactions, the combined company is now organized in an “Up-C” structure, in which substantially all of the assets and business of Alight are held by Alight Holdings, of which Alight is the managing member pursuant to the terms of the Second Amended and Restated Limited Liability Company Agreement of Alight Holdings that went into effect upon the completion of the Business Combination. As of March 31, 2022, Alight owns approximately 86 % of the economic interest in Alight Holdings, but has 100 % of the voting power and controls the management of Alight Holdings. As of March 31, 2022, the non-voting ownership percentage held by noncontrolling interest was approximately 14 % (see Note 9 "Stockholders' and Members' Equity" for additional information). Basis of Presentation As a result of the Business Combination, for accounting purposes, the Company is the acquirer and Alight Holdings is the acquiree and accounting predecessor. While the Closing Date was July 2, 2021, we determined that as the impact of one day would be immaterial to the results of operations, we utilized July 1, 2021 as the date of the Business Combination for accounting purposes. Therefore, the financial statement presentation includes the financial statements of Alight Holdings as Predecessor for the periods prior to July 1, 2021 and the Company as Successor for the periods including and after July 1, 2021, including the consolidation of Alight Holdings. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and should be read in conjunction with the Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission (“SEC”) on March 10, 2022. In the opinion of management, all adjustments, including normal recurring adjustments, considered necessary for a fair presentation have been included. All significant intercompany transactions and balances have been eliminated upon consolidation. The results of operations for interim periods are not necessarily indicative of the results to be expected for future quarters or for the full fiscal year ending December 31, 2022. Nature of Business We are a leading cloud-based provider of integrated digital human capital and business solutions. We have an unwavering belief that a company’s success starts with its people, and our solutions connect human insights with technology. The Alight Worklife® employee engagement platform provides a seamless customer experience by combining content, plus artificial intelligence (“AI”) and data analytics to enable Alight's business process as a service ("BPaaS") model. Our mission-critical solutions enable employees to enrich their health, wealth and wellbeing which helps global organizations achieve a high-performance culture. Our solutions include: • Employer Solutions: driven by our digital, software and AI-led capabilities powered by the Alight Worklife® platform and spanning total employee wellbeing and engagement, including integrated benefits administration, healthcare navigation, financial health, employee wellbeing and payroll. These solutions are designed to support employers in effectively managing their workforce through a seamless, integrated platform. We leverage data across all interactions and activities to improve the employee experience, reduce operational costs and better inform management processes and decision-making. In addition, employees benefit from an integrated platform and user experience, coupled with a full-service client care center, helping them manage the full life cycle of their health, wealth and careers. • Professional Services: includes our project-based cloud deployment and consulting offerings that provide expertise with both human capital and financial platforms. Specifically, this includes cloud advisory and deployment, and optimization services for cloud platforms such as Workday, SAP SuccessFactors, Oracle, and Cornerstone OnDemand. |
Accounting Policies and Practic
Accounting Policies and Practices | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Accounting Policies and Practices | 2. Accounting Policies and Practices Use of Estimates The preparation of the accompanying Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of reserves and expenses. These estimates and assumptions are based on management’s best estimates and judgments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Management believes its estimates to be reasonable given the current facts available. Management adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity markets, and foreign currency exchange rate movements increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be predicted with certainty, actual results could differ significantly from these estimates. Changes in estimates resulting from continuing changes in the economic environment would, if applicable, be reflected in the financial statements in future periods. Tax Receivable Agreement In connection with the Business Combination, we entered into a Tax Receivable Agreement (the “TRA”) with certain of our pre-Business Combination owners that provides for the payment by Alight to such owners of 85 % of the benefits that Alight is deemed to realize as a result of the Company’s share of existing tax basis acquired in the Business Combination and other tax benefits related to entering into the TRA. The Company accounts for the TRA as a liability at fair value and is subject to remeasurement at each balance sheet date. Any change in fair value is recognized within the Condensed Consolidated Statements of Comprehensive Income (Loss). Subsequent to the Business Combination, upon equity exchanges of the noncontrolling interests, the Company records obligations under the TRA at the gross undiscounted amount of the expected future payments as an increase to the liability with an offset to Additional paid-in capital. New Accounting Pronouncements There are no pending accounting pronouncements that are expected to have a material impact upon our Consolidated Financial Statements. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Mar. 31, 2022 | |
Revenue From Contract With Customer [Abstract] | |
Revenue from Contracts with Customers | 3. Revenue from Contracts with Customers The majority of the Company’s revenue is highly recurring and is derived from contracts with customers to provide integrated, cloud-based human capital solutions that empower clients and their employees to manage their health, wealth and HR needs. The Company’s revenues are disaggregated by recurring and project revenues within each reportable segment. Recurring revenues are typically longer term in nature and more predictable on an annual basis, while project revenues consist of project work of a shorter duration. See Note 12 “Segment Reporting” for quantitative disclosures of recurring and project revenues by reportable segment. The Company’s reportable segments are Employer Solutions, Professional Services and Hosted Business. Employer Solutions are driven by our digital, software and AI-led capabilities powered by the Alight Worklife® platform and spanning total employee wellbeing and engagement, including integrated benefits administration, healthcare navigation, financial health, and employee wellbeing and payroll. Professional Services includes project-based cloud deployment and consulting offerings. The Company believes these revenue categories depict how the nature, amount, timing, and uncertainty of its revenue and cash flows are affected by economic factors. Revenues are recognized when control of the promised services is transferred to the customer in the amount that best reflects the consideration to which the Company expects to be entitled in exchange for those services. The majority of the Company’s revenue is recognized over time as the customer simultaneously receives and consumes the benefits of our services. On occasion, we may be entitled to a fee based on achieving certain performance criteria or contract milestones. To the extent that we cannot estimate with reasonable assurance the likelihood that we will achieve the performance target, we will constrain this portion of the transaction price and recognize it when or as the uncertainty is resolved. Any taxes assessed on revenues relating to services provided to our clients are recorded on a net basis. All of the Company’s revenues are described in more detail below. Administrative Services We provide benefits, human resource and payroll administration services across all of our solutions, which are highly recurring. The Company’s contracts may include administration services across one or multiple solutions and typically have three to five-year terms with mutual renewal options. These contracts typically consist of an implementation phase and an ongoing administration phase: Implementation phase – In connection with the Company’s long-term agreements, highly customized implementation efforts are often necessary to set up clients and their human resource, payroll or benefit programs on the Company’s systems and operating processes. Work performed during the implementation phase is considered a set-up activity because it does not transfer a service to the customer. Therefore, it is not a separate performance obligation. As these agreements are longer term in nature, our contracts generally provide that if the client terminates a contract, we are entitled to an additional payment for services performed through the termination date designed to recover our up-front costs of implementation. Any fees received from the customer as part of the implementation are, in effect, an advance payment for the future ongoing administration services to be provided. Ongoing administration services phase – For all solutions, the ongoing administration phase includes a variety of plan and payroll administration services and system support services. More specifically, these services include data management, calculations, reporting, fulfillment/communications, compliance services, call center support, and in our Health solutions agreements, annual on-boarding and enrollment support. While there are a variety of activities performed across all solutions, the overall nature of the obligation is to provide integrated administration solutions to the customer. The agreement represents a stand-ready obligation to perform these activities across all solutions on an as-needed basis. The customer obtains value from each period of service, and each time increment (i.e., each month, or each benefit cycle in the case of our Health solutions arrangements) is distinct and substantially the same. Accordingly, the ongoing administration services for each solution represents a series and each series (i.e., each month, or each benefit cycle including the enrollment period in the case of our Health solutions arrangements) of distinct services are deemed to be a single performance obligation. In agreements that include multiple performance obligations, the transaction price related to each performance obligation is based on a relative stand-alone selling price basis. We establish the stand-alone selling price using observable market prices that the Company charges separately for similar solutions to similar customers. Our contracts with our clients specify the terms and conditions upon which the services are based. Fees for these services are primarily based on a contracted fee charged per participant per period (e.g., monthly or annually, as applicable). These contracts may also include fixed components, including lump-sum implementation fees. Our fees are not typically payable until the commencement of the ongoing administration phase. Once fees become payable, payment is typically due on a monthly basis as we perform under the contract, and we are entitled to be reimbursed for work performed to date in the event of termination. For Health solutions administration services, each benefits cycle inclusive of the enrollment period represents a time increment under the series guidance and is a single performance obligation. Although ongoing fees are typically not payable until the commencement of the ongoing administrative phase, we begin transferring services to our customers approximately four months prior to payments being due as part of our annual enrollment services. Although our per-participant fees are considered variable, they are typically predictable in nature, and therefore we do not generally constrain any portion of our transaction price estimates. We use an input method based on the labor costs incurred relative to total labor costs as the measure of progress in satisfying our Health solutions performance obligation commencing when the customer’s annual enrollment services begin. Given that the Health solutions enrollment and administrative services are stand-ready in nature, it can be difficult to estimate the total expected efforts or hours we will incur for a particular benefits cycle. Therefore, the input measure is based on the historical effort expended each month, which is measured as labor cost. For all other benefits administration, human resources and payroll services where each month represents a distinct time increment under the series guidance, we allocate the transaction price to the month we are performing our services. Therefore, the amount recognized each month is the variable consideration related to that month plus any fixed monthly or annual fee, which is recognized on a straight-line basis. Revenue for these types of arrangements are therefore more consistent throughout the year. In the normal course of business, we enter into change orders or other contract modifications to add or modify services provided to the customer. We evaluate whether these modifications should be accounted for as separate contracts or a modification to an existing contract. To the extent that the modification changes a promise that forms part of the underlying series, the modification is not accounted for as a separate contract. Other Contracts In addition to the ongoing administration services, the Company also has services across all solutions that represent separate performance obligations and that are often shorter in duration, such as our cloud deployment services, cloud advisory services, participant financial advisory services, and enrollment services not bundled with ongoing administration services. Fee arrangements can be in the form of fixed-fee, time-and-materials, or fees based on assets under management. Payment is typically due on a monthly basis as we perform under the contract, and we are entitled to be reimbursed for work performed to date in the event of termination. Services may represent stand-ready obligations that meet the series provision, in which case all variable consideration is allocated to each distinct time increment. Other services are recognized over-time based on a method that faithfully depicts the transfer of value to the customer, which may be based on the value of labor hours worked or time elapsed, depending on the facts and circumstances. The majority of the fees for enrollment services not bundled with ongoing administration services may be in the form of commissions received from insurance carriers for policy placement and are variable in nature. These annual enrollment services include both employer-sponsored arrangements that place both retiree Medicare coverage and voluntary benefits and direct-to-consumer Medicare placement. Our performance obligations under these annual enrollment services are typically completed over a short period upon which a respective policy is placed or confirmed with no ongoing fulfillment obligations. For both the employer-sponsored and direct-to-consumer arrangements, we recognize the majority of the placement revenue in the fourth quarter of the calendar year, which is when most of the placement or renewal activity occurs. However, the Company may continue to receive commissions from carriers until the respective policy lapses or is cancelled. The Company bases the estimates of total transaction price on supportable evidence from an analysis of past transactions, and only includes amounts that are probable of being received or not refunded. As it relates to the direct-to-consumer arrangements, because our obligation is complete upon placement of the policy, we recognize revenue at that date, which includes both compensation due to us in the first year as well as an estimate of the total renewal commissions that will be received over the lifetime of the policy. The variable consideration estimate requires significant judgement, and will vary based on product type, estimated commission rates and the expected lives of the respective policies and other factors. For both the employer-sponsored and direct-to-customer arrangements, the estimated total transaction price may differ from the ultimate amount of commissions we may collect. Consequently, the estimate of total transaction price is adjusted over time as the Company receives confirmation of cash received, or as other information becomes available. The Company has elected to apply practical expedients to not disclose the revenue related to unsatisfied performance obligations if (1) the contract has an original duration of one year or less, or (2) the variable consideration is allocated entirely to an unsatisfied performance obligation which is recognized as a series of distinct goods and services that form a single performance obligation. Contract Costs Costs to obtain a Contract The Company capitalizes incremental costs to obtain a contract with a customer that are expected to be recovered. Assets recognized for the costs to obtain a contract, which primarily includes sales commissions paid in relation to the initial contract, are amortized over the expected life of the underlying customer relationships, which is 7 years for our payroll and cloud solutions and 15 years for all of our other solutions. For situations where the duration of the contract is 1 year or less, the Company has applied a practical expedient and recognized the costs of obtaining a contract as an expense when incurred. These costs are recorded in Cost of services, exclusive of depreciation and amortization in the Condensed Consolidated Statements of Comprehensive Income (Loss) . Costs to fulfill a Contract The Company capitalizes costs to fulfill contracts which includes highly customized implementation efforts to set up clients and their human resource, payroll or benefit programs. Assets recognized for the costs to fulfill a contract are amortized on a systematic basis over the expected life of the underlying customer relationships, which is 7 years for our payroll and cloud solutions and 15 years for all of our other solutions. Amortization for all contracts costs are recorded in Cost of services, exclusive of depreciation and amortization in the Condensed Consolidated Statements of Comprehensive Income (Loss) (see Note 5 “Other Financial Data”). |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2022 | |
Business Combinations [Abstract] | |
Acquisitions | 4. Acquisitions 2021 Acquisitions Alight Business Combination On July 2, 2021, the Company completed the Business Combination for consideration transferred of approximately $ 5.0 billion. The Business Combination was accounted for using the acquisition method under Accounting Standards Codification Topic 805, Business Combinations (“ASC 805”), which requires, among other things, that most assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The preliminary consideration and allocation of the purchase price to the fair value of the combined assets acquired and liabilities assumed is presented below. The preliminary measurement of consideration transferred, including noncontrolling interest, and the allocations reflect the best estimates of the valuations currently available and are subject to change once additional analyses are completed. The accounting for the Business Combination is not complete and the allocation will be finalized as soon as practicable, but no later than one year from the acquisition date. On the Closing Date, the Company paid $ 36 million of deferred underwriting costs related to FTAC’s initial public offering and $ 37 million of fees related to the private placement transaction, which were treated as a reduction of equity. Approximately $ 21 million of the Company’s acquisition-related costs were paid on the Closing Date. Additionally, $ 39 million of seller transaction costs were paid on the Closing Date, including $ 36 million in advisory and investment banker fees that were contingent upon the consummation of the Business Combination. As these fees are considered success fees in nature, they are considered to have been incurred “on the line”, and therefore, were not recognized in the Condensed Consolidated Statements of Comprehensive Income (Loss) in either the Predecessor or Successor periods. On the Closing Date, approximately $ 36 million of certain executive compensation related expenses that were contingent upon the closing of the Business Combination were triggered. As these expenses were contingent upon the change-in-control event, they are considered to have been incurred “on the line”, and therefore, were not recognized in the Condensed Consolidated Statements of Comprehensive Income (Loss) in either the Predecessor or Successor periods. The following table summarizes the preliminary consideration transferred (in millions): Cash consideration to prior equityholders (1) $ 1,055 Repayment of debt 1,814 Total cash consideration $ 2,869 Continuing unitholders rollover equity into the Company (2) 1,414 Contingent consideration - Tax Receivable Agreement (3) 610 Contingent consideration - Seller Earnouts (3) 109 Total consideration transferred $ 5,002 Noncontrolling interest (4) $ 799 (1) Includes cash consideration paid to reimburse seller for certain transaction expenses. (2) The Company issued approximately 141 million shares of Class A Common Stock that had a total fair value of approximately $ 1.4 billion based on the price of $ 10 per share on July 2, 2021, the acquisition date. (3) The TRA and Seller Earnouts represent liability classified contingent consideration. The estimated fair value of the TRA is preliminary and subject to adjustments in subsequent periods. Refer to Note 9 “Stockholders’ and Members’ Equity”, Note 14 “Financial Instruments” and Note 15 “Tax Receivable Agreement” for further discussion. (4) The fair value of the noncontrolling interest is estimated based on the fair value of acquired business, which was determined based on the price of the Company's Class A Common Stock at the July 2, 2021 Closing Date, plus the contingent consideration related to the Seller Earnouts. The fair value of the noncontrolling interest is preliminary and subject to adjustments in subsequent periods. The noncontrolling interest is exchangeable for Class A Common Stock at the option of the holder. Refer to Note 9 “Stockholders’ and Members’ Equity” for additional information. The following table summarizes the preliminary purchase price allocation (in millions): Cash and cash equivalents $ 460 Receivables 484 Fiduciary assets 1,015 Other current assets 162 Fixed assets 205 Other assets 425 Accounts payable and accrued liabilities ( 327 ) Fiduciary liabilities ( 1,015 ) Other current liabilities ( 291 ) Debt assumed ( 2,370 ) Deferred tax liabilities ( 3 ) Other liabilities ( 396 ) Intangible assets 4,078 Total identifiable net assets $ 2,427 Goodwill $ 3,374 Measurement Period Adjustments During the first quarter of 2022, the Company recorded measurement period adjustments to its initial allocation of purchase price as a result of ongoing valuation procedures on assets acquired and liabilities assumed, including (i) a decrease in Receivables of $ 2 million, (ii) a decrease in Other current liabilities of $ 2 million, (iii) a decrease in consideration transferred of $ 8 million due to an updated TRA valuation, and (iv) a decrease of $ 1 million in noncontrolling interest due to the change in consideration transferred. The impact of these measurement period adjustments on the Condensed Consolidated Statements of Comprehensive Income (Loss) was not material. Intangible Assets Intangible assets were identified that met either the separability criterion or the contractual-legal criterion described in ASC 805. The trade name intangible asset represents the corporate Alight tradename, which was valued using the relief-from-royalty method. The technology related intangible assets represent software developed by Alight Holdings to differentiate its product/service offerings for its customers, valued using the relief-from-royalty method. The customer-related and contract-based intangible assets represent strong, long-term relationships with customers, valued using the multi-period excess earnings method. The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair value Useful life Identifiable intangible assets (in millions) (in years) Definite lived trade names $ 400 15 Technology related intangibles $ 222 6 Customer-related and contract-based intangibles $ 3,456 15 Goodwill Approximately $ 3.4 billion has been preliminarily allocated to goodwill. Goodwill represents the excess of the gross consideration transferred over the fair value of the underlying net tangible and identifiable definite-lived intangible assets acquired. Qualitative factors that contribute to the recognition of goodwill include certain intangible assets that are not recognized as separate identifiable intangible assets apart from goodwill, including assembled workforce and expected future market conditions. Of the preliminary goodwill established, $ 1.6 billion was tax deductible. Retiree Health Exchange On October 1, 2021, the Company completed the acquisition for consideration transferred of approximately $ 199 million. The acquisition was accounted for using the acquisition method under ASC 805, which requires, among other things, that most assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The preliminary consideration and allocation of the purchase price to the fair value of the combined assets acquired and liabilities assumed is presented below. The preliminary measurement of consideration transferred and the allocations reflect the best estimates of the valuations currently available and are subject to change once additional analyses are completed. The accounting for the acquisition is not complete as the valuation for acquired assets and liabilities have not been finalized and these final valuations of the assets and liabilities could have a material impact on the preliminary purchase price allocation disclosed below. The allocation will be finalized as soon as practicable, but no later than one year from the acquisition date. The following table summarizes the preliminary purchase price allocation (in millions): Receivables $ 1 Other current assets 29 Accounts payable and accrued liabilities ( 13 ) Intangible assets 104 Fair value of net assets acquired and liabilities assumed 121 Goodwill 78 Total consideration $ 199 Intangible assets include customer-related and contract-based intangibles and technology with estimated useful lives of 13 years and 5 years, respectively. Approximately $ 78 million has been preliminarily allocated to goodwill, all of which was tax deductible. |
Other Financial Data
Other Financial Data | 3 Months Ended |
Mar. 31, 2022 | |
Other Financial Data [Abstract] | |
Other Financial Data | 5. Other Financial Data Condensed Consolidated Balance Sheets Information Receivables, net The components of Receivables, net are as follows (in millions): March 31, December 31, 2022 2021 Billed and unbilled receivables $ 553 $ 520 Allowance for expected credit losses ( 7 ) ( 5 ) Balance at end of period $ 546 $ 515 Other current assets The components of Other current assets are as follows (in millions): March 31, December 31, 2022 2021 Deferred project costs $ 40 $ 39 Prepaid expenses 60 66 Commissions receivable 95 148 Other 59 49 Total $ 254 $ 302 Other assets The components of Other assets are as follows (in millions): March 31, December 31, 2022 2021 Deferred project costs $ 295 $ 274 Operating lease right of use asset 106 120 Commissions receivable 28 34 Other 81 44 Total $ 510 $ 472 The current and non-current portions of deferred project costs relate to costs to obtain and fulfill contracts (see Note 3 “Revenue from Contracts with Customers”). During the Successor three months ended March 31, 2022 and the Predecessor three months ended March 31, 2021, total amortization expense of $ 12 million and $ 16 million was recorded in Cost of services, exclusive of depreciation and amortization in the Condensed Consolidated Statements of Comprehensive Income (Loss), respectively. Other current assets and Other assets include the fair value of outstanding derivative instruments related to interest rate swaps. The balances in Other current assets as of March 31, 2022 and December 31, 2021 were $ 18 million and $ 1 million, respectively. The balances in Other assets as of March 31, 2022 and December 31, 2021 were $ 58 million and $ 16 million, respectively (see Note 13 “Derivative Financial Instruments” for additional information). Other current liabilities The components of Other current liabilities are as follows (in millions): March 31, December 31, 2022 2021 Deferred revenue $ 154 $ 148 Operating lease liabilities 45 44 Finance lease liabilities 26 27 Other 169 182 Total $ 394 $ 401 Other liabilities The components of Other liabilities are as follows (in millions): March 31, December 31, 2022 2021 Deferred revenue $ 54 $ 55 Operating lease liabilities 113 139 Finance lease liabilities 29 34 Unrecognized tax positions 44 44 Other 71 81 Total $ 311 $ 353 The current and non-current portions of deferred revenue relates to consideration received in advance of performance under client contracts. During both the Successor three months ended March 31, 2022 and the Predecessor three months ended March 31, 2021, revenue of approximately $ 79 million was recognized that was recorded as deferred revenue at the beginning of each period. Other current liabilities as of both March 31, 2022 and December 31, 2021 include a deferred consideration payment of $ 83 million related to an acquisition completed in the fourth quarter of 2021. Other current liabilities and Other liabilities include the fair value of outstanding derivative instruments related to interest rate swaps. The balances in Other current liabilities as of March 31, 2022 and December 31, 2021 were $ 3 million and $ 8 million, respectively. The balances in Other liabilities at both March 31, 2022 and December 31, 2021 were $ 1 million (see Note 13 “Derivative Financial Instruments” for additional information). |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, Net | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, Net | 6. Goodwill and Intangible assets, net The changes in the net carrying amount of goodwill are as follows (in millions): Employer Professional Solutions Services Total Balance as of December 31, 2021 $ 3,564 74 3,638 Measurement period adjustments ( 10 ) — ( 10 ) Foreign currency translation ( 1 ) — ( 1 ) Balance as of March 31, 2022 $ 3,553 74 3,627 Intangible assets by asset class are as follows (in millions): March 31, 2022 December 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Intangible assets: Customer-related and contract based $ 3,661 180 3,481 $ 3,662 $ 119 $ 3,543 Technology related intangibles 254 31 223 254 20 234 Trade name (finite life) 407 21 386 407 14 393 Total $ 4,322 232 4,090 $ 4,323 $ 153 $ 4,170 The net carrying amount of Intangible assets as of March 31, 2022 includes preliminary fair values for certain customer-related and contract-based identifiable intangible assets, technology-related intangible assets and tradename assets based on management’s preliminary estimate of fair value (see Note 4 “Acquisitions” for additional information). The change in gross carrying amounts for customer-related and contract-based intangibles also relates to the unfavorable impact of foreign currency translation adjustments. Amortization expense from finite-lived intangible assets for the Successor three months ended March 31, 2022 and the Predecessor three months ended March 31, 2021 was $ 79 million and $ 50 million, respectively, which was recorded in Depreciation and intangible amortization in the Condensed Consolidated Statements of Comprehensive Income (Loss). The following table reflects intangible assets net carrying amount and weighted-average remaining useful lives as of March 31, 2022 (in millions, except for years): Net Weighted-Average Carrying Remaining Amount Useful Lives Intangible assets at March 31, 2022: Customer-related and contract-based $ 3,481 14.2 Technology-related intangibles 223 5.2 Trade name (finite life) 386 14.1 Total $ 4,090 Subsequent to March 31, 2022, the annual amortization expense is expected to be as follows (in millions): Customer-Related Technology Trade and Contract Based Related Name Intangibles Intangibles Intangible 2022 (April - December) $ 183 $ 32 $ 21 2023 245 43 28 2024 245 43 28 2025 245 43 28 2026 245 42 27 Thereafter 2,318 20 254 Total amortization expense $ 3,481 $ 223 $ 386 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes The Company’s effective tax rate for the Successor three months ended March 31, 2022 was ( 12 %), and for the Predecessor three months ended March 31, 2021 was 14 %. The change in the effective tax rate is primarily driven by the Business Combination as the Predecessor and certain of its subsidiaries operated in the U.S. as partnerships for income tax purposes and generally as corporate entities in non-U.S. jurisdictions. The Predecessor effective tax rate for the applicable periods was substantially higher due to certain non-recurring items included in pre-tax and tax expense during the Successor period. The effective tax rate for the Successor three months ended March 31, 2022 is lower than the 21 % U.S. statutory corporate income tax rate primarily due to losses in certain non-U.S. jurisdictions for which a tax benefit has not been recorded. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | 8. Debt Debt outstanding consisted of the following (in millions): March 31, December 31, Maturity Date 2022 2021 Term Loan May 1, 2024 $ 70 $ 72 Term Loan, Amended October 31, 2026 — 1,958 Term Loan, Third Incremental (1) August 31, 2028 — 517 Term Loan, B-1 (2) August 31, 2028 2,466 — Secured Senior Notes June 1, 2025 313 314 $ 294 m Revolving Credit Facility, Amended August 31, 2026 — — Other June 30, 2022 9 7 Total debt, net 2,858 2,868 Less: current portion of long-term debt, net ( 40 ) ( 38 ) Total long-term debt, net $ 2,818 $ 2,830 (1) The net balance for the Third Incremental Term Loan at December 31, 2021 includes unamortized debt issuance costs of $ 6 million. (2) The net balance for the B-1 Term Loan at March 31, 2022 includes unamortized debt issuance costs of $ 9 million. Term Loan In May 2017, the Company entered into a 7 -year Initial Term Loan. During November 2017 and November 2019, the Company entered into Incremental Term Loans under identical terms as the Initial Term Loan. In August 2020, the Company refinanced the Term Loan by paying down $ 270 million of principal using the proceeds from the August 2020 Unsecured Senior Notes issuance, extending the maturity date on $ 1,986 million of the balance to October 31, 2026 , and adding an interest rate floor of 50 bps (the "Amended Term Loan"). As part of the consideration transferred in the Business Combination, $ 556 million of principal was repaid on the portion of the Term Loan that was not amended. In August 2021, the Company entered into a new Third Incremental Term Loan facility for $ 525 million that matures August 31, 2028 . In January 2022, the Company refinanced the Amended Term Loan and the Third Incremental Term Loan to have a concurrent maturity date of August 31, 2028 and updated interest rate terms as described below (the "B-1 Term Loan"). Interest rates on the original Term Loan borrowings are based on the London Interbank Offered Rate (“LIBOR”) plus a margin based on defined ratios ( 275 or 300 bps). The Company used the 1‑month LIBOR rate for all periods presented. Interest rates on the B-1 Term Loan borrowings are based on the Secured Overnight Financing Rate ("SOFR") plus a margin of 300 bps. The Company is required to make principal payments at the end of each fiscal quarter based on defined terms in the agreement with the remaining principal balances due on the maturity dates. During the Successor three months ended March 31, 2022 and the Predecessor three months ended March 31, 2021, the Company made total principal payments of $ 8 million and $ 7 million, respectively. The Company utilized swap agreements to fix a portion of the floating interest rates through December 2026 (see Note 13 “Derivative Financial Instruments”). Secured Senior Notes In May 2020, the Company issued $ 300 million of Secured Senior Notes. These Secured Senior Notes have a maturity date of June 1, 2025 and accrue interest at a fixed rate of 5.75 % per annum, payable semi-annually on June 1 and December 1 of each year , beginning on December 1, 2020 . Revolving Credit Facility In May 2017, the Company entered into a 5 -year $ 250 million revolving credit facility with a multi-bank syndicate with a maturity date of May 1, 2022 . During August 2020, the Company extended the maturity date for $ 226 million of the revolving credit facility to October 31, 2024 . In August 2021, the Company replaced and refinanced the revolving credit facilities with a $ 294 million revolving credit facility with a maturity date of August 31, 2026 . At March 31, 2022, $ 4 million of unused letters of credit related to various insurance policies and real estate leases were issued under the revolving credit facility and there were no additional borrowings. The Company is required to make periodic payments for commitment fees and interest related to the revolving credit facility and outstanding letters of credit. During the Successor three months ended March 31, 2022 and the Predecessor three months ended March 31, 2021, the Company made immaterial payments related to these fees. As part of the acquisition of NGA Human Resources ("NGA HR") during the year ended December 31, 2019, the Company acquired a revolving credit facility of approximately $ 20 million secured on the accounts receivable balance of NGA HR. As of March 31, 2022, the outstanding borrowings under this facility were $ 9 million, which are reflected in Other in the table above. During the three months ended March 31, 2022, the Company made principal payments of $ 52 million, offset by borrowings of $ 54 million. The facility matures on June 30, 2022 , at which time any outstanding borrowings are repayable in full, with interest payable monthly. Interest is calculated based on an applicable reference rate plus a margin. Financing Fees, Premiums and Interest Expense The Company capitalized financing fees and premiums related to the Term Loan, Revolver and Secured Senior Notes issued. These financing fees and premiums were recorded as an offset to the aggregate debt balances and are being amortized over the respective loan terms. Total interest expense related to the debt instruments for the Successor three months ended March 31, 2022 and Predecessor three months ended March 31, 2021 was $ 27 million and $ 53 million, respectively, which included amortization of financing fees of $ 1 million benefit for the Successor three months ended March 31, 2022 and expenses of approximately $ 4 million for the Predecessor three months ended March 31, 2021. Interest expense is recorded in Interest expense in the Condensed Consolidated Statements of Comprehensive Income (Loss). Principal Payments Aggregate contractual principal payments as of March 31, 2022 are as follows (in millions): Remainder of 2022 (April - December) $ 33 2023 31 2024 83 2025 325 2026 25 Thereafter 2,356 Total payments $ 2,853 |
Stockholders' and Members' Equi
Stockholders' and Members' Equity | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
Stockholders' and Members' Equity | 9. Stockholders’ and Members’ Equity Predecessor Equity Class A Common Units There were no grants of Class A common units during the three months ended March 31, 2021. Each holder of Class A common units is entitled to one vote per unit. Class A-1 Common Units During the three months ended March 31, 2021, the Company granted 643 Restricted Class A-1 common units. Holders of Class A-1 common units are not entitled to voting rights. Class B Common Units During the three months ended March 31, 2021, there were no grants of Class B common units. Holders of Class B common units are not entitled to voting rights. Successor Equity Preferred Stock Upon the Closing of the Business Combination, 1,000,000 preferred shares, par value $ 0.0001 per share, were authorized. There were no preferred shares issued and outstanding as of March 31, 2022. Class A Common Stock As of March 31, 2022, 465,225,352 shares of Class A Common Stock, including 7,583,284 of shares of unvested Class A Common Stock, were legally issued and outstanding. Holders of shares of Class A Common Stock are entitled to one vote per share, and together with the holders of shares of Class B Common Stock, will participate ratably in any dividends that may be declared by the Company’s Board of Directors. Class B Common Stock Upon the Closing of the Business Combination, the Seller Earnouts resulted in the issuance of a total of 14,999,998 Class B instruments (including 808,276 unvested shares of Class B Common Stock related to employee compensation) to the equityholders of the Predecessor. The equityholders of the Predecessor that exchanged their Predecessor Class A units for shares of Class A Common Stock in the Business Combination received shares of Class B Common Stock, and the equityholders of the Predecessor that continue to hold Class A units of Alight Holdings (“Continuing Unitholders”) received Class B common units of Alight Holdings. The Class B Common Stock and Class B common units are not entitled to a vote and accrue dividends equal to amounts declared per corresponding share of Class A Common Stock and Class A unit; however, such dividends are paid if and when such share of Class B Common Stock or Class B unit converts into a share of Class A Common Stock or Class A unit. If any of the shares of Class B Common Stock or Class B common units do not vest on or before the seventh anniversary of the Closing Date, such shares or units will be automatically forfeited and cancelled for no consideration and will not be entitled to receive any cumulative dividend payments. These Class B instruments (excluding the unvested shares of Class B Common Stock related to employee compensation) are liability classified; refer to Note 14 “Financial Instruments” for additional information. As further described below, there are two series of Class B instruments outstanding. Class B-1 As of March 31, 2022, 4,990,453 shares of Class B-1 Common Stock were legally issued and outstanding, including 404,138 unvested shares of Class B-1 Common Stock related to employee compensation. Shares of Class B-1 Common Stock vest and automatically convert into shares of Class A Common Stock on a 1 -for-1 basis if the volume weighted average price (“VWAP”) of the shares of Class A Common Stock equals or exceeds $ 12.50 per share for 20 or more trading days within a consecutive 30 -trading day period (or in the event of a change of control or liquidation event that implies a $ 12.50 per share valuation on a diluted basis). To the extent any unvested share of Class B-1 Common Stock automatically converts into a share of Class A Common Stock, (i) such share or unit shall remain unvested in accordance with the terms and conditions of the applicable award agreement until it vests or is forfeited in accordance with the terms thereof and (ii) such share or unit shall be treated as unvested Class A consideration as if such share or unit was part of the unvested Class A consideration as of the Closing Date. As of March 31, 2022, 2,509,546 Class B-1 common units of Alight Holdings were legally issued and outstanding. Class B-1 common units vest and automatically convert into Class A common units of Alight Holdings on a 1 -for-1 basis if the VWAP of the shares of Class A Common Stock equals or exceeds $ 12.50 per share for 20 or more trading days within a consecutive 30 -trading day period (or in the event of a change of control or liquidation event that implies a $ 12.50 per share valuation on a diluted basis). Class B-2 As of March 31, 2022, 4,990,453 shares of Class B-2 Common Stock were legally issued and outstanding, including 404,138 unvested shares of Class B-2 Common Stock related to employee compensation. Shares of Class B-2 Common Stock vest and automatically convert into shares of Class A Common Stock on a 1 -for-1 basis if the VWAP of the shares of Class A Common Stock equals or exceeds $ 15.00 per share for 20 or more trading days within a consecutive 30 -trading day period (or in the event of a change of control or liquidation event that implies a $ 15.00 per share valuation on a diluted basis). To the extent any unvested share of Class B-2 Common Stock automatically converts into a share of Class A Common Stock, (i) such share or unit shall remain unvested in accordance with the terms and conditions of the applicable award agreement until it vests or is forfeited in accordance with the terms thereof and (ii) such share or unit shall be treated as unvested Class A consideration as if such share or unit was part of the unvested Class A consideration as of the Closing Date. As of March 31, 2022, 2,509,546 Class B-2 common units of Alight Holdings were legally issued and outstanding. Class B-2 common units vest and automatically convert into Class A common units of Alight Holdings on a 1 -for-1 basis if the VWAP of the shares of Class A Common Stock equals or exceeds $ 15.00 per share for 20 or more trading days within a consecutive 30 -trading day period (or in the event of a change of control or liquidation event that implies a $ 15.00 per share valuation on a diluted basis). Class B-3 Upon the Closing of the Business Combination, 10,000,000 shares of Class B-3 Common Stock, par value $ 0.0001 , were authorized. There are no shares of Class B-3 Common Stock issued and outstanding as of March 31, 2022. Class V Common Stock As of March 31, 2022, 76,220,431 shares of Class V Common Stock were legally issued and outstanding. Holders of Class V Common Stock are entitled to one vote per share and have no economic rights. The Class V Common Stock is held on a 1 -for-1 basis with Class A Units in Alight Holdings held by Continuing Unitholders. The Class A Units, together with an equal number of shares of Class V Common Stock, can be exchanged for an equal number of shares of Class A Common Stock. Class Z Common Stock Upon the Closing of the Business Combination, a total of 8,671,507 Class Z instruments were issued to the equityholders of the Predecessor. The equityholders of the Predecessor that exchanged their Predecessor Class A units for shares of Class A Common Stock in the Business Combination received shares of Class Z Common Stock, and the Continuing Unitholders received Class Z common units of Alight Holdings. The Class Z instruments were issued to the equityholders of the Predecessor to allow for the re-allocation of the consideration paid to the holders of unvested management equity (i.e., the unvested shares of Class A, Class B-1, and Class B-2 Common Stock) to the equityholders of the Predecessor in the event such equity is forfeited under the terms of the applicable award agreement and will only vest in connection with any such forfeiture. As of March 31, 2022, 5,595,577 shares of Class Z Common Stock ( 5,046,819 Class Z-A, 274,379 Class Z-B-1, and 274,379 Class Z-B-2) were legally issued and outstanding. Holders of shares of Class Z-A, Class Z-B-1 and Class Z-B-2 Common Stock are not entitled to voting rights. The Class Z shares convert into shares of Class A Common Stock, Class B-1 Common Stock or Class B-2 Common Stock, as applicable, in connection with the ultimate forfeiture of the shares of unvested Class A, unvested Class B-1, and unvested Class B-2 common stock issued to participating management holders. As of March 31, 2022, 3,075,930 Class Z common units ( 2,774,272 Class Z-A, 150,829 Class Z-B-1, and 150,829 Class Z-B-2) were legally issued and outstanding. Holders of Class Z-A, Class Z-B-1 and Class Z-B-2 common units are not entitled to voting rights. The Class Z units convert into units of Alight Holdings Class A common units, Alight Holdings Class B-1 or Alight Holdings Class B-2 common units, as applicable, in connection with the ultimate forfeiture of the shares of unvested Class A, unvested Class B-1, and unvested Class B-2 common stock issued to participating management holders. Class A Units Holders of Alight Holdings Class A units can exchange all or any portion of their Class A units, together with the cancellation of an equal number of shares of Class V Common Stock, for a number of shares of Class A Common Stock equal to the number of exchanged Class A units. Alight has the option to cash settle any future exchange. The Continuing Unitholders’ ownership of Class A units represents the noncontrolling interest of the Company, which is accounted for as permanent equity on the Condensed Consolidated Balance Sheets. As of March 31, 2022, there were 541,445,783 Class A Units outstanding, of which 465,225,352 are held by the Company and 76,220,431 are held by the noncontrolling interest of the Company. The Alight Holdings limited liability company agreement contains provisions which require that a one-to-one ratio is maintained between each class of Alight Holdings units held by Alight and its subsidiaries (including the Alight Group, Inc. and certain tax blocker entities, but excluding subsidiaries of Alight Holdings) and the number of outstanding shares of the corresponding class of Alight common stock, subject to certain exceptions (including in respect of management equity in the form of options, rights or other securities which have not been converted into or exercised for Alight common stock). In addition, the Alight Holdings limited liability company agreement permits Alight, in its capacity as the managing member of Alight Holdings, to take actions to maintain such ratio, including undertaking stock splits, combinations, recapitalizations and exercises of the exchange rights of holders of Alight Holdings units. Exchange of Class A Units During the first quarter of 2022, 1,239,256 Class A units and a corresponding number of shares of Class V Common Stock were exchanged for Class A Common Stock. As a result of the exchanges, Alight, Inc. increased its ownership in Alight Holdings and accordingly increased its equity by approximately $ 13 million, recorded in Additional paid-in capital. Pursuant to the TRA, described in Note 15 "Tax Receivable Agreement," the Class A unit exchange created an additional TRA liability of $ 6 million, with an offset to Additional paid-in-capital. The following table reflects the changes in our outstanding stock: Class A Class B-1 Class B-2 Class V Class Z Balance at December 31, 2021 456,282,881 4,990,453 4,990,453 77,459,687 5,595,577 Conversion of noncontrolling interest 1,239,256 — — ( 1,239,256 ) — Shares granted upon vesting 106,188 — — — — Issuance for compensation to non-employees (1) 13,743 — — — — Balance at March 31, 2022 457,642,068 4,990,453 4,990,453 76,220,431 5,595,577 (1) Issued to certain members of the Board of Directors in lieu of cash retainer. Dividends There were no dividends declared during the Successor three months ended March 31, 2022. Accumulated Other Comprehensive Income As of March 31, 2022, the Accumulated other comprehensive income balance included unrealized losses for interest rate swaps and foreign currency translation adjustments related to our foreign subsidiaries that do not have the U.S. dollar as their functional currency. Changes in accumulated other comprehensive income, net of noncontrolling interests and tax, are as follows (in millions): Foreign Currency Interest Translation Rate Adjustments Swaps (1) Total Balance at December 31, 2021 $ — $ 8 $ 8 Other comprehensive (loss) income before reclassifications ( 4 ) 53 49 Tax expense (benefit) 1 ( 14 ) ( 13 ) Other comprehensive (loss) income before reclassifications, net of tax ( 3 ) 39 36 Amounts reclassified from accumulated other comprehensive income — — — Tax expense — — — Amounts reclassified from accumulated other comprehensive income, net of tax — — — Net current period other comprehensive income, net of tax ( 3 ) 39 36 Balance at March 31, 2022 $ ( 3 ) $ 47 $ 44 (1) Reclassifications from this category are recorded in Interest expense. See Note 13 “Derivative Financial Instruments” for additional information. |
Share-Based Compensation Expens
Share-Based Compensation Expense | 3 Months Ended |
Mar. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-Based Compensation Expense | 10. Share-Based Compensation Expense Share-based payments consist of grants of restricted share units (“RSUs”) and performance-based restricted share units (“PRSUs”). The Company recognizes compensation expense on a straight-line basis over the requisite service period for awards expected to ultimately vest. Predecessor Replacement Awards In connection with the Business Combination, the holders of certain unvested awards under the Predecessor plans were granted replacement awards in the Successor company. • Class B units: The unvested Class B units of Alight Holdings were granted replacement shares of unvested Class A, Class B-1 and Class B-2 Common Stock and ultimately vest on the third anniversary of the Closing Date, but could vest earlier based on the achievement of certain market-based conditions. • Class A-1 units: The unvested Class A-1 units of Alight Holdings were granted replacement shares of unvested Class A, Class B-1 and Class B-2 Common Stock on an equivalent fair value basis. The service-based portion of the grant vests ratably over periods of two to five years and the remaining vests upon the achievement of certain market-based conditions. The Class B and Class A-1 units that were replaced represent the unvested shares of Class A, Class B-1 and Class B-2 Common Stock subject to the forfeiture re-allocation provision per the Class Z instruments discussed in Note 9 “Stockholders’ and Members’ Equity”. These unvested shares are accounted for as restricted stock in accordance with Accounting Standards Codification Topic 718, Compensation - Stock Compensation . Successor Awards In connection with the Business Combination, the Company adopted the Alight, Inc. 2021 Omnibus Incentive Plan. Under this plan, for grants issued during the Successor three months ended March 31, 2022, approximately 55 % of the units are subject to time-based vesting requirements and approximately 45 % are subject to performance-based vesting requirements. The majority of the time-based RSUs vest ratably each March 10 over a three-year period with one-third vesting on each of March 10, 2023, 2024 and 2025. The majority of the PRSUs vest upon achievement of the Company’s performance goals, Total Revenue and Total BPaaS Revenue. The Company begins to recognize expense associated with the PRSUs when the achievement of the performance condition is deemed probable. During the first quarter of 2022, based on management's analysis of the corresponding performance conditions, the Company increased expected achievement levels related to the PRSUs granted in 2021. The fair value of each RSU and PRSU is based upon the grant date market price. The aggregate grant date fair value of RSUs and PRSUs granted during the Successor three months ended March 31, 2022 was $ 43 million and $8 7 million, respectively. Restricted Share Units and Performance Based Restricted Share Units The following tables summarizes the unit activity related to the RSUs and PRSUs during the three months ended March 31, 2022: Weighted Weighted Average Average Grant Date Grant Date Fair Value Fair Value RSUs (1) Per Unit PRSUs (1) Per Unit Balance as of December 31, 2021 7,148,416 $ 12.27 16,743,113 $ 11.20 Granted 4,705,544 9.12 7,905,475 10.99 Vested ( 252,041 ) 9.76 — — Forfeited ( 323,181 ) 12.64 ( 603,204 ) 11.93 Balance as of March 31, 2022 11,278,738 $ 10.98 24,045,384 $ 11.05 (1) These share totals include both unvested shares and restricted stock units. Share-based Compensation The Company recorded share-based compensation costs related to the RSUs and PRSUs for the Successor three months ended March 31, 2022 and the Predecessor three months ended March 31, 2021 of $ 33 million and $ 2 million, respectively. As of March 31, 2022, total future compensation expense related to unvested RSUs was $ 116 million, which will be recognized over a remaining weighted-average amortization period of approximately 1.6 years. As of March 31, 2022, total future compensation expense related to PRSUs was $ 222 million, which will be recognized over a remaining weighted-average amortization period of approximately 2.0 years. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 11. Earnings Per Share Basic earnings per share is calculated by dividing the net loss attributable to Alight, Inc. by the weighted average number of shares of Class A Common Stock issued and outstanding for the Successor period. The computation of diluted earnings per share reflects the potential dilution that could occur if dilutive securities and other contracts to issue shares were exercised or converted into shares or resulted in the issuance of shares that then would then share in the net income of Alight, Inc. The Company’s Class V Common Stock and Class Z Common Stock do not participate in the earnings or losses of the Company and are therefore not participating securities and have not been included in either the basic or diluted earnings per share calculations. In conjunction with the Business Combination, the Company issued Seller Earnouts contingent consideration, which is payable in the Company’s Common Stock when the related market conditions are achieved. As the related conditions to pay the consideration had not been satisfied as of March 31, 2022, the Seller Earnouts were excluded from the diluted earnings per share calculations. Basic and diluted earnings per share are as follows (in millions, except for share and per share amounts): Three Months Ended March 31, 2022 Basic and diluted net loss per share: Numerator Net loss attributable to Alight, Inc. - basic and diluted $ ( 11 ) Denominator Weighted-average shares outstanding - basic and diluted 456,838,216 Basic and diluted net loss per share $ ( 0.02 ) For the Successor three months ended March 31, 2022, 76,220,431 Alight Holdings Class A units related to noncontrolling interests and 11,137,394 unvested RSUs, were not included in the computation of diluted shares outstanding as their impact would have been anti-dilutive. In addition, 14,999,998 shares related to the Seller Earnouts and 35,501,399 unvested PRSUs, based on maximum achievement levels, were excluded from the calculation of basic and diluted earnings per share as the market and performance conditions had not yet been met as of the end of the period. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | 12. Segment Reporting The Company’s reportable segments have been determined using a management approach, which is consistent with the basis and manner in which the Company’s chief operating decision maker (“CODM”) uses financial information for the purposes of allocating resources and evaluating performance. The Company’s Chief Executive Officer is its CODM. The CODM evaluates the performance of the Company based on its total revenue and segment profit. The CODM also uses revenue and segment profit to manage and evaluate our business, make planning decisions, and as performance measures for Company-wide bonus plans. These key financial measures provide an additional view of our operational performance over the long-term and provide useful information that we use in order to maintain and grow our business. The accounting policies of the segments are the same as those described in Note 2 “Accounting Policies and Practices.” The Company does not report assets by reportable segments as this information is not reviewed by the CODM on a regular basis. Information regarding the Company’s current reportable segments is as follows (in millions): Revenue Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, 2022 2021 Employer Solutions Recurring $ 570 $ 533 Project 53 54 Total Employer Solutions 623 587 Professional Services Recurring 30 29 Project 60 63 Total Professional Services 90 92 Hosted Business 12 10 Total $ 725 $ 689 There was no single client who accounted for more than 10% of the Company’s revenues in any of the periods presented. Segment Profit Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, 2022 2021 Employer Solutions $ 142 $ 136 Professional Services — — Hosted Business — ( 3 ) Total of all reportable segments 142 133 Share-based compensation 33 2 Transaction and integration expenses (1) 6 — Non-recurring professional expenses (2) — 9 Restructuring 6 7 Other (3) 3 ( 5 ) Depreciation 17 24 Intangible amortization 79 50 Operating (Loss) Income ( 2 ) 46 Gain from change in fair value of financial instruments ( 13 ) — Gain from change in fair value of tax receivable agreement ( 5 ) — Interest expense 29 62 Other (income) expense, net ( 1 ) 8 Loss Before Income Tax Expense (Benefit) $ ( 12 ) $ ( 24 ) (1) Transaction and integration expenses related to acquisition activity. (2) Non-recurring professional expenses includes external advisor and legal costs related to the Company’s Business Combination completed in 2021. (3) For the three months ended March 31, 2022, other primarily includes expenses related to debt refinancing, offset by Other income, net. For the three months ended March 31, 2021, other includes long-term incentive expenses, offset by Other expense, net. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2022 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | 13. Derivative Financial Instruments The Company is exposed to market risks, including changes in interest rates. To manage the risk related to these exposures, the Company has entered into various derivative instruments that reduce these risks by creating offsetting exposures. Interest Rate Swaps The Company has utilized swap agreements that will fix the floating interest rates associated with its Term Loan as shown in the following table: Designation Date Effective Date Initial Notional Amount Notional Amount Outstanding as of March 31, 2022 Fixed Rate Expiration Date July 2021 August 2020 557,500,000 557,500,000 2.5069 % May 2022 July 2021 August 2020 89,863,420 101,365,120 3.0680 % February 2023 December 2021 August 2020 181,205,050 162,935,400 0.7203 % April 2024 December 2021 August 2020 388,877,200 367,997,600 0.6826 % April 2024 December 2021 May 2022 220,130,318 n/a 0.4570 % April 2024 December 2021 May 2022 306,004,562 n/a 0.4480 % April 2024 December 2021 April 2024 871,205,040 n/a 1.6533 % June 2025 December 2021 April 2024 435,602,520 n/a 1.6560 % June 2025 December 2021 April 2024 435,602,520 n/a 1.6650 % June 2025 March 2022 June 2025 1,197,000,000 n/a 2.5540 % December 2026 Concurrent with the Term Loan refinancing, we amended our interest rate swaps to incorporate Term SOFR. In accordance with Accounting Standards Codification Topic 848, Reference Rate Reform , we did not redesignate the interest rate hedges when they were amended from LIBOR to SOFR; as we are permitted to maintain the designation through the transition. Also during the Successor three months ended March 31, 2022, we executed an additional interest rate swap, which has been designated as a cash flow hedge. Our swap agreements amortize or accrete based on achieving targeted hedge ratios. All interest rate swaps have been designated as cash flow hedges. As a result of hedge amendments in December 2021 and July 2021, the fair value of the instruments at the time of re-designation are being amortized into interest expense over the remaining life of the instruments. The Company also entered into a new interest rate swap that will be effective June 2025 and will mature December 2026. Financial Instrument Presentation The fair values and location of outstanding derivative instruments recorded in the Condensed Consolidated Balance Sheets are as follows (in millions): March 31, December 31, 2022 2021 Assets Other current assets $ 18 $ 1 Other assets $ 58 $ 16 Total $ 76 $ 17 Liabilities Other current liabilities $ 3 $ 8 Other liabilities 1 1 Total $ 4 $ 9 The Company estimates that approximately $ 17 million of derivative gains included in Accumulated other comprehensive income as of March 31, 2022 will be reclassified into earnings over the next twelve months. |
Financial Instruments
Financial Instruments | 3 Months Ended |
Mar. 31, 2022 | |
Financial Instruments [Abstract] | |
Financial Instruments | 14. Financial Instruments Seller Earnouts Upon completion of the Business Combination, the equity owners of Alight Holdings received an earnout in the form of non-voting shares of Class B-1 and Class B-2 Common Stock, which automatically convert into Class A Common Stock if, at any time during the seven years following the Closing Date certain criteria are achieved. See Note 9 “Stockholders’ and Members’ Equity” for additional information regarding the Seller Earnouts. The portion of the Seller Earnouts related to employee compensation is accounted for as share-based compensation. See Note 10 “Share-Based Compensation Expense” for additional information. In addition, a portion of the Seller Earnouts relates to Class Z instruments that were forfeited by individual equityholders and will be re-allocated to the holders of unvested management equity upon the ultimate vesting date. See Note 9 “Stockholders’ and Members’ Equity” for additional information regarding the Class Z instruments. This portion of Seller Earnouts is accounted for as a contingent consideration liability recorded at the fair value on the individual forfeiture date. These instruments are not subject to remeasurement at each balance sheet date . As of March 31, 2022, the balance for this portion of the Seller Earnouts was $ 1 million, offset in Gain from change in fair value of financial instruments in the Condensed Consolidated Statements of Comprehensive Income (Loss) . The majority of the Seller Earnouts, which are not related to employee compensation, are accounted for as a contingent consideration liability at fair value within Financial instruments on the Condensed Consolidated Balance Sheets because the Seller Earnouts do not meet the criteria for classification within equity. This portion of the Seller Earnouts are subject to remeasurement at each balance sheet date. At March 31, 2022 and December 31, 2021, the Seller Earnouts had a fair value of $ 121 million and $ 135 million, respectively. For the Successor three months ended March 31, 2022, a gain of $ 14 million was recorded in Gain from change in fair value of financial instruments in the Condensed Consolidated Statements of Comprehensive Income (Loss) . The fair value of the Seller Earnouts is determined using Monte Carlo simulation and Option Pricing Methods (Level 3 inputs, see Note 16 "Fair Value Measurements"). Significant unobservable inputs are used in the assessment of fair value, including the following assumptions: volatility, risk-free interest rate, expected holding period and probability assessments based on the likelihood of reaching the performance targets defined in the Business Combination. |
Tax Receivable Agreement
Tax Receivable Agreement | 3 Months Ended |
Mar. 31, 2022 | |
Receivables [Abstract] | |
Tax Receivable Agreement | 15. Tax Receivable Agreement In connection with the Business Combination, Alight entered into the Tax Receivable Agreement (the “TRA”) with certain owners of Alight Holdings prior to the Business Combination. Pursuant to the TRA, the Company will pay certain sellers, as applicable, 85% of the tax benefits, of any savings that we realize, calculated using certain assumptions, as a result of (i) tax basis adjustments from sales and exchanges of Alight Holdings equity interests in connection with or following the Business Combination and certain distributions with respect to Alight Holdings equity interests, (ii) our utilization of certain tax attributes, and (iii) certain other tax benefits related to entering into the TRA. Actual tax benefits realized by Alight may differ from tax benefits calculated under the TRA as a result of the use of certain assumptions in the TRA, including the use of an assumed weighted-average state and local income tax rate to calculate tax benefits. While the amount of existing tax basis, the anticipated tax basis adjustments and the actual amount and utilization of tax attributes, as well as the amount and timing of any payments under the TRA, will vary depending upon a number of factors, we expect that the payments that Alight may make under the TRA will be substantial. The Company’s TRA liability established upon completion of the Business Combination is measured at fair value on a recurring basis using significant unobservable inputs (Level 3). The TRA liability balance at March 31, 2022 assumes: (i) a constant blended U.S. federal, state and local income tax rate of 26.17 %; (ii) no material changes in tax law; (iii) the ability to utilize tax attributes based on current alternative tax forecasts; and (iv) future payments under the TRA are made when due under the TRA. The amount of the expected future payments under the TRA has been discounted to its present value using a discount rate of 7.6 %. Subsequent to the Business Combination, we will record additional liabilities under the TRA when Class A units of Alight Holdings are exchanged for Class A Common Stock. Liabilities resulting from these exchanges will be recorded on a gross undiscounted basis and are not remeasured at fair value. During the Successor three months ended March 31, 2022, an additional TRA liability of $ 6 million was established as a result of these exchanges. The following table summarizes the changes in the TRA liabilities (in millions): Tax Receivable Agreement Liability Beginning balance as of December 31, 2021 $ 581 Measurement period adjustment ( 8 ) Fair value remeasurement ( 5 ) Conversion of noncontrolling interest 6 Ending Balance as of March 31, 2022 $ 574 |
Fair Value Measurement
Fair Value Measurement | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | 16. Fair Value Measurement Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standards related to fair value measurements include a hierarchy for information and valuations used in measuring fair value that is broken down into three levels based on reliability, as follows: • Level 1 – observable inputs such as quoted prices in active markets for identical assets and liabilities; • Level 2 – inputs other than quoted prices for identical assets in active markets that are observable either directly or indirectly; and • Level 3 – unobservable inputs in which there is little or no market data which requires the use of valuation techniques and the development of assumptions. The Company’s financial assets and liabilities measured at fair value on a recurring basis are as follows (in millions): March 31, 2022 Level 1 Level 2 Level 3 Total Assets Interest rate swaps $ — $ 76 $ — $ 76 Total assets recorded at fair value $ — $ 76 $ — $ 76 Liabilities Interest rate swaps $ — $ 4 $ — $ 4 Contingent consideration liability — — 32 32 Seller Earnouts liability — — 121 121 Tax receivable agreement liability — — 568 568 Total liabilities recorded at fair value $ — $ 4 $ 721 $ 725 December 31, 2021 Level 1 Level 2 Level 3 Total Assets Interest rate swaps $ — $ 17 $ — $ 17 Total assets recorded at fair value $ — $ 17 $ — $ 17 Liabilities Interest rate swaps $ — $ 9 $ — $ 9 Contingent consideration liability — — 33 33 Seller Earnouts liability — — 135 135 Tax receivable agreement liability — — 581 581 Total liabilities recorded at fair value $ — $ 9 $ 749 $ 758 Derivatives The valuations of the derivatives intended to mitigate our interest rate risk are determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each instrument. This analysis utilizes observable market-based inputs, including interest rate curves, interest rate volatility, or spot and forward exchange rates, and reflects the contractual terms of these instruments, including the period to maturity. In addition, credit valuation adjustments, which consider the impact of any credit enhancements to the contracts, are incorporated in the fair values to account for potential non-performance risk. Contingent Consideration The contingent consideration liabilities relate to acquisitions completed during the Successor six months ended December 31, 2021, the Predecessor years ended December 31, 2020 and 2018, and are included in Other current liabilities and Other liabilities on the Condensed Consolidated Balance Sheets. The fair value of these liabilities is determined using a discounted cash flow analysis. Changes in the fair value of the liabilities are included in Other (income) expense, net in the Condensed Consolidated Statements of Comprehensive Income (Loss). Significant unobservable inputs are used in the assessment of fair value, including assumptions regarding discount rates and probability assessments based on the likelihood of reaching the various targets set out in the acquisition agreements. The following table summarizes the changes in deferred contingent consideration liabilities (in millions): Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, 2022 2021 Beginning balance $ 33 $ 26 Measurement period adjustments ( 2 ) 2 Accretion of contingent consideration 1 — Ending Balance $ 32 $ 28 Non-Recurring Fair Value Measurements The Company’s financial liabilities not measured at fair value on a recurring basis are as follows (in millions): March 31, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value Liabilities Current portion of long-term debt, net $ 40 $ 40 $ 38 $ 38 Long-term debt, net 2,818 2,799 2,830 2,834 Total $ 2,858 $ 2,839 $ 2,868 $ 2,872 The carrying value of the Term Loan, Secured Senior Notes and Unsecured Senior Notes include the outstanding principal balances, less any unamortized discount or premium. The carrying value of the Term Loan approximates fair value as it bears interest at variable rates and we believe our credit risk is consistent with when the debt originated. The outstanding balances under the Senior Notes have fixed interest rates and the fair value is classified as Level 2 within the fair value hierarchy and corroborated by observable market data (see Note 8 “Debt”). The carrying amounts of Cash and cash equivalents, Receivables, net and Accounts payable and accrued liabilities approximate their fair values due to the short-term maturities of these instruments. During the Successor three months ended March 31, 2022, there were no transfers in or out of the Level 1, Level 2 or Level 3 classifications. |
Restructuring and Integration
Restructuring and Integration | 3 Months Ended |
Mar. 31, 2022 | |
Restructuring And Related Activities [Abstract] | |
Restructuring and Integration | 17. Restructuring and Integration During the third quarter of 2019, management initiated a restructuring and integration plan (“the Plan”) following the completion of the Hodges acquisition and in anticipation of the NGA HR acquisition, which was completed on November 1, 2019. The Plan is intended to integrate and streamline operations across the Company and is expected to generate cost reductions related to position eliminations and facility and system rationalizations. The Company expects to incur costs related to severance, contract and lease exits and other related costs. The Company expects these restructuring and integration activities and related expenses to affect continuing operations through the fourth quarter of 2022. The Plan is expected to result in cumulative costs of approximately $ 140 million through the end of the Plan, consisting of approximately $ 69 million in severance and related benefits, and approximately $ 71 million in other costs, including technology realization, lease consolidation costs, advisory and consulting fees. The Plan is expected to generate annual cost savings of approximately $ 196 million by 2022. From the inception of the Plan through March 31, 2022, the Company has incurred total expenses of $ 111 million. These charges are recorded in Cost of services, exclusive of depreciation and amortization and Selling, general and administrative expenses in the Condensed Consolidated Statements of Comprehensive Income (Loss). The following table summarizes restructuring costs by type that have been incurred through March 31, 2022 and are estimated to be incurred through the end of the Plan. Estimated costs by type may be revised in future periods as these assumptions are updated: Successor Three Months Ended Estimated Estimated March 31, Inception to Remaining Total 2022 Date Costs Cost (1) Employer Solutions Severance and Related Benefits $ 2 $ 48 $ 11 $ 59 Other Restructuring Costs (2) 3 48 14 62 Total Employer Solutions $ 5 $ 96 $ 25 $ 121 Professional Services Severance and Related Benefits $ — $ 8 $ 2 $ 10 Other Restructuring Costs (2) 1 7 2 9 Total Professional Services $ 1 $ 15 $ 4 $ 19 Total Restructuring Costs $ 6 $ 111 $ 29 $ 140 (1) Actual costs, when incurred, may vary due to changes in the assumptions built into the Plan. Significant assumptions that may change when plans are finalized and implemented include, but are not limited to, changes in severance calculations, changes in the assumptions underlying sublease loss calculations due to changing market conditions, and changes in the overall analysis that might cause the Company to add or cancel component initiatives. (2) Other costs associated with the Plan primarily include consulting and legal fees and lease consolidation. As of March 31, 2022, approximately $ 5 million of the restructuring liability is unpaid and is recorded in Accounts payable and accrued liabilities on the Condensed Consolidated Balance Sheets. Severance and Related Benefits Other Restructuring Costs Total Accrued restructuring liability as of December 31, 2021 $ 4 $ — $ 4 Restructuring charges 2 4 6 Cash payments ( 3 ) ( 1 ) ( 4 ) Non-cash charges (1) — ( 1 ) ( 1 ) Accrued restructuring liability as of March 31, 2022 $ 3 $ 2 $ 5 Non-cash charges relate to lease consolidation . |
Employee Benefits
Employee Benefits | 3 Months Ended |
Mar. 31, 2022 | |
Compensation And Retirement Disclosure [Abstract] | |
Employee Benefits | 18. Employee Benefits Defined Contribution Savings Plans Certain of the Company’s employees participate in a defined contribution savings plan sponsored by the Company. For the Successor three months ended March 31, 2022 and the Predecessor three months ended March 31, 2021, expenses were $ 17 million and $ 16 million, respectively. Expenses were recognized in Cost of services, exclusive of depreciation and amortization and Selling, general and administrative expenses in the Condensed Consolidated Statements of Comprehensive Income (Loss). |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 19. Commitments and Contingencies Legal The Company is subject to various claims, tax assessments, lawsuits, and proceedings that arise in the ordinary course of business relating to the delivery of our services and the effectiveness of our technologies. The damages claimed in these matters are or may be substantial. Accruals for any exposures, and related insurance or other receivables, when applicable, are included on the Condensed Consolidated Balance Sheets and have been recognized in Selling, general and administrative expenses in the Condensed Consolidated Statements of Comprehensive Income (Loss) to the extent that losses are deemed probable and are reasonably estimable. These amounts are adjusted from time to time as developments warrant. Management believes that the reserves established are appropriate based on the facts currently known. The reserves recorded at March 31, 2022 and December 31, 2021 were not significant. Guarantees and Indemnifications The Company provides a variety of service performance guarantees and indemnifications to its clients. The maximum potential amount of future payments represents the notional amounts that could become payable under the guarantees and indemnifications if there were a total default by the guaranteed parties, without consideration of possible recoveries under recourse provisions or other methods. These notional amounts may bear no relationship to the future payments that may be made, if any, for these guarantees and indemnifications. To date, the Company has not been required to make any payment under any client arrangement as described above. The Company has assessed the current status of performance risk related to the client arrangements with performance guarantees and believes that any potential payments would be immaterial to the Condensed Consolidated Financial Statements. Purchase Obligations The Company’s expected cash outflow for non-cancellable purchase obligations related to purchases of information technology assets and services is $ 17 million, $ 26 million, $ 27 million, $ 9 million, $ 4 million and $ 3 million, for the remainder of 2022 and the years ended 2023, 2024, 2025, 2026 and thereafter, respectively. Service Obligations On September 1, 2018, the Company executed an agreement to form a strategic partnership with Wipro, a leading global information technology, consulting and business process services company. The Company’s expected cash outflow for non-cancellable service obligations related to our strategic partnership with Wipro is $ 106 million, $ 147 million, $ 154 million, $ 162 million, $ 170 million and $ 332 million for the remainder of 2022 and the years ended 2023, 2024, 2025, 2026 and thereafter, respectively. The Company may terminate its arrangement with Wipro for cause or for the Company’s convenience. In the case of a termination for convenience, the Company would be required to pay a termination fee, including certain of Wipro’s unamortized costs, plus 25 % of any remaining portion of the minimum level of services the Company agreed to purchase from Wipro over the course of 10 years. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | 20. Subsequent Events The Company has evaluated subsequent events through the filing of this Quarterly Report on Form 10-Q, and determined that there have been no events that have occurred that would require adjustments to our disclosures in the consolidated financial statements except for the transaction described below. |
Accounting Policies and Pract_2
Accounting Policies and Practices (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation As a result of the Business Combination, for accounting purposes, the Company is the acquirer and Alight Holdings is the acquiree and accounting predecessor. While the Closing Date was July 2, 2021, we determined that as the impact of one day would be immaterial to the results of operations, we utilized July 1, 2021 as the date of the Business Combination for accounting purposes. Therefore, the financial statement presentation includes the financial statements of Alight Holdings as Predecessor for the periods prior to July 1, 2021 and the Company as Successor for the periods including and after July 1, 2021, including the consolidation of Alight Holdings. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and should be read in conjunction with the Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission (“SEC”) on March 10, 2022. In the opinion of management, all adjustments, including normal recurring adjustments, considered necessary for a fair presentation have been included. All significant intercompany transactions and balances have been eliminated upon consolidation. The results of operations for interim periods are not necessarily indicative of the results to be expected for future quarters or for the full fiscal year ending December 31, 2022. |
Use of Estimates | Use of Estimates The preparation of the accompanying Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of reserves and expenses. These estimates and assumptions are based on management’s best estimates and judgments. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. Management believes its estimates to be reasonable given the current facts available. Management adjusts such estimates and assumptions when facts and circumstances dictate. Illiquid credit markets, volatile equity markets, and foreign currency exchange rate movements increase the uncertainty inherent in such estimates and assumptions. As future events and their effects cannot be predicted with certainty, actual results could differ significantly from these estimates. Changes in estimates resulting from continuing changes in the economic environment would, if applicable, be reflected in the financial statements in future periods. |
Tax Receivable Agreement | Tax Receivable Agreement In connection with the Business Combination, we entered into a Tax Receivable Agreement (the “TRA”) with certain of our pre-Business Combination owners that provides for the payment by Alight to such owners of 85 % of the benefits that Alight is deemed to realize as a result of the Company’s share of existing tax basis acquired in the Business Combination and other tax benefits related to entering into the TRA. The Company accounts for the TRA as a liability at fair value and is subject to remeasurement at each balance sheet date. Any change in fair value is recognized within the Condensed Consolidated Statements of Comprehensive Income (Loss). Subsequent to the Business Combination, upon equity exchanges of the noncontrolling interests, the Company records obligations under the TRA at the gross undiscounted amount of the expected future payments as an increase to the liability with an offset to Additional paid-in capital. |
New Accounting Pronouncements | New Accounting Pronouncements There are no pending accounting pronouncements that are expected to have a material impact upon our Consolidated Financial Statements. |
Fair Value Measurement | Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting standards related to fair value measurements include a hierarchy for information and valuations used in measuring fair value that is broken down into three levels based on reliability, as follows: • Level 1 – observable inputs such as quoted prices in active markets for identical assets and liabilities; • Level 2 – inputs other than quoted prices for identical assets in active markets that are observable either directly or indirectly; and • Level 3 – unobservable inputs in which there is little or no market data which requires the use of valuation techniques and the development of assumptions. |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Business Acquisition [Line Items] | |
Summary of Preliminary Consideration Transferred | The following table summarizes the preliminary consideration transferred (in millions): Cash consideration to prior equityholders (1) $ 1,055 Repayment of debt 1,814 Total cash consideration $ 2,869 Continuing unitholders rollover equity into the Company (2) 1,414 Contingent consideration - Tax Receivable Agreement (3) 610 Contingent consideration - Seller Earnouts (3) 109 Total consideration transferred $ 5,002 Noncontrolling interest (4) $ 799 (1) Includes cash consideration paid to reimburse seller for certain transaction expenses. (2) The Company issued approximately 141 million shares of Class A Common Stock that had a total fair value of approximately $ 1.4 billion based on the price of $ 10 per share on July 2, 2021, the acquisition date. (3) The TRA and Seller Earnouts represent liability classified contingent consideration. The estimated fair value of the TRA is preliminary and subject to adjustments in subsequent periods. Refer to Note 9 “Stockholders’ and Members’ Equity”, Note 14 “Financial Instruments” and Note 15 “Tax Receivable Agreement” for further discussion. (4) The fair value of the noncontrolling interest is estimated based on the fair value of acquired business, which was determined based on the price of the Company's Class A Common Stock at the July 2, 2021 Closing Date, plus the contingent consideration related to the Seller Earnouts. The fair value of the noncontrolling interest is preliminary and subject to adjustments in subsequent periods. The noncontrolling interest is exchangeable for Class A Common Stock at the option of the holder. Refer to Note 9 “Stockholders’ and Members’ Equity” for additional information. |
Summary of Preliminary Purchase Price allocation | The following table summarizes the preliminary purchase price allocation (in millions): Cash and cash equivalents $ 460 Receivables 484 Fiduciary assets 1,015 Other current assets 162 Fixed assets 205 Other assets 425 Accounts payable and accrued liabilities ( 327 ) Fiduciary liabilities ( 1,015 ) Other current liabilities ( 291 ) Debt assumed ( 2,370 ) Deferred tax liabilities ( 3 ) Other liabilities ( 396 ) Intangible assets 4,078 Total identifiable net assets $ 2,427 Goodwill $ 3,374 |
Summary of Preliminary Values Allocated to Identifiable Intangible Assets and Estimated Useful Lives | Intangible assets were identified that met either the separability criterion or the contractual-legal criterion described in ASC 805. The trade name intangible asset represents the corporate Alight tradename, which was valued using the relief-from-royalty method. The technology related intangible assets represent software developed by Alight Holdings to differentiate its product/service offerings for its customers, valued using the relief-from-royalty method. The customer-related and contract-based intangible assets represent strong, long-term relationships with customers, valued using the multi-period excess earnings method. The values allocated to identifiable intangible assets and their estimated useful lives are as follows: Fair value Useful life Identifiable intangible assets (in millions) (in years) Definite lived trade names $ 400 15 Technology related intangibles $ 222 6 Customer-related and contract-based intangibles $ 3,456 15 |
Retiree Health Exchange | |
Business Acquisition [Line Items] | |
Summary of Preliminary Purchase Price allocation | The following table summarizes the preliminary purchase price allocation (in millions): Receivables $ 1 Other current assets 29 Accounts payable and accrued liabilities ( 13 ) Intangible assets 104 Fair value of net assets acquired and liabilities assumed 121 Goodwill 78 Total consideration $ 199 |
Other Financial Data (Tables)
Other Financial Data (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Other Financial Data [Abstract] | |
Summary of Components of Receivables, Net | The components of Receivables, net are as follows (in millions): March 31, December 31, 2022 2021 Billed and unbilled receivables $ 553 $ 520 Allowance for expected credit losses ( 7 ) ( 5 ) Balance at end of period $ 546 $ 515 |
Summary of Components of Other Current Assets | The components of Other current assets are as follows (in millions): March 31, December 31, 2022 2021 Deferred project costs $ 40 $ 39 Prepaid expenses 60 66 Commissions receivable 95 148 Other 59 49 Total $ 254 $ 302 |
Summary of Components of Other Assets | The components of Other assets are as follows (in millions): March 31, December 31, 2022 2021 Deferred project costs $ 295 $ 274 Operating lease right of use asset 106 120 Commissions receivable 28 34 Other 81 44 Total $ 510 $ 472 |
Summary of Components of Other Current Liabilities | The components of Other current liabilities are as follows (in millions): March 31, December 31, 2022 2021 Deferred revenue $ 154 $ 148 Operating lease liabilities 45 44 Finance lease liabilities 26 27 Other 169 182 Total $ 394 $ 401 |
Summary of Components of Other Liabilities | The components of Other liabilities are as follows (in millions): March 31, December 31, 2022 2021 Deferred revenue $ 54 $ 55 Operating lease liabilities 113 139 Finance lease liabilities 29 34 Unrecognized tax positions 44 44 Other 71 81 Total $ 311 $ 353 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, Net (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Changes in Net Carrying Amount of Goodwill | The changes in the net carrying amount of goodwill are as follows (in millions): Employer Professional Solutions Services Total Balance as of December 31, 2021 $ 3,564 74 3,638 Measurement period adjustments ( 10 ) — ( 10 ) Foreign currency translation ( 1 ) — ( 1 ) Balance as of March 31, 2022 $ 3,553 74 3,627 |
Schedule of Intangible Assets by Asset Class | Intangible assets by asset class are as follows (in millions): March 31, 2022 December 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Intangible assets: Customer-related and contract based $ 3,661 180 3,481 $ 3,662 $ 119 $ 3,543 Technology related intangibles 254 31 223 254 20 234 Trade name (finite life) 407 21 386 407 14 393 Total $ 4,322 232 4,090 $ 4,323 $ 153 $ 4,170 |
Schedule of Intangible Asset Net Carrying Amount and Weighted Average Remaining Useful Lives | The following table reflects intangible assets net carrying amount and weighted-average remaining useful lives as of March 31, 2022 (in millions, except for years): Net Weighted-Average Carrying Remaining Amount Useful Lives Intangible assets at March 31, 2022: Customer-related and contract-based $ 3,481 14.2 Technology-related intangibles 223 5.2 Trade name (finite life) 386 14.1 Total $ 4,090 |
Schedule of Intangible Assets Expected Annual Amortization Expense | Subsequent to March 31, 2022, the annual amortization expense is expected to be as follows (in millions): Customer-Related Technology Trade and Contract Based Related Name Intangibles Intangibles Intangible 2022 (April - December) $ 183 $ 32 $ 21 2023 245 43 28 2024 245 43 28 2025 245 43 28 2026 245 42 27 Thereafter 2,318 20 254 Total amortization expense $ 3,481 $ 223 $ 386 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Outstanding | Debt outstanding consisted of the following (in millions): March 31, December 31, Maturity Date 2022 2021 Term Loan May 1, 2024 $ 70 $ 72 Term Loan, Amended October 31, 2026 — 1,958 Term Loan, Third Incremental (1) August 31, 2028 — 517 Term Loan, B-1 (2) August 31, 2028 2,466 — Secured Senior Notes June 1, 2025 313 314 $ 294 m Revolving Credit Facility, Amended August 31, 2026 — — Other June 30, 2022 9 7 Total debt, net 2,858 2,868 Less: current portion of long-term debt, net ( 40 ) ( 38 ) Total long-term debt, net $ 2,818 $ 2,830 (1) The net balance for the Third Incremental Term Loan at December 31, 2021 includes unamortized debt issuance costs of $ 6 million. (2) The net balance for the B-1 Term Loan at March 31, 2022 includes unamortized debt issuance costs of $ 9 million. |
Schedule of Aggregate Contractual Principal Payments | Aggregate contractual principal payments as of March 31, 2022 are as follows (in millions): Remainder of 2022 (April - December) $ 33 2023 31 2024 83 2025 325 2026 25 Thereafter 2,356 Total payments $ 2,853 |
Stockholders' and Members' Eq_2
Stockholders' and Members' Equity (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
Schedule of Changes in Outstanding Stock | The following table reflects the changes in our outstanding stock: Class A Class B-1 Class B-2 Class V Class Z Balance at December 31, 2021 456,282,881 4,990,453 4,990,453 77,459,687 5,595,577 Conversion of noncontrolling interest 1,239,256 — — ( 1,239,256 ) — Shares granted upon vesting 106,188 — — — — Issuance for compensation to non-employees (1) 13,743 — — — — Balance at March 31, 2022 457,642,068 4,990,453 4,990,453 76,220,431 5,595,577 Issued to certain members of the Board of Directors in lieu of cash retainer. |
Schedule of Changes in Accumulated Other Comprehensive Income (Loss) by Component | Changes in accumulated other comprehensive income, net of noncontrolling interests and tax, are as follows (in millions): Foreign Currency Interest Translation Rate Adjustments Swaps (1) Total Balance at December 31, 2021 $ — $ 8 $ 8 Other comprehensive (loss) income before reclassifications ( 4 ) 53 49 Tax expense (benefit) 1 ( 14 ) ( 13 ) Other comprehensive (loss) income before reclassifications, net of tax ( 3 ) 39 36 Amounts reclassified from accumulated other comprehensive income — — — Tax expense — — — Amounts reclassified from accumulated other comprehensive income, net of tax — — — Net current period other comprehensive income, net of tax ( 3 ) 39 36 Balance at March 31, 2022 $ ( 3 ) $ 47 $ 44 (1) Reclassifications from this category are recorded in Interest expense. See Note 13 “Derivative Financial Instruments” for additional information. |
Share-Based Compensation Expe_2
Share-Based Compensation Expense (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Unit Activity | The following tables summarizes the unit activity related to the RSUs and PRSUs during the three months ended March 31, 2022: Weighted Weighted Average Average Grant Date Grant Date Fair Value Fair Value RSUs (1) Per Unit PRSUs (1) Per Unit Balance as of December 31, 2021 7,148,416 $ 12.27 16,743,113 $ 11.20 Granted 4,705,544 9.12 7,905,475 10.99 Vested ( 252,041 ) 9.76 — — Forfeited ( 323,181 ) 12.64 ( 603,204 ) 11.93 Balance as of March 31, 2022 11,278,738 $ 10.98 24,045,384 $ 11.05 (1) These share totals include both unvested shares and restricted stock units. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Earnings Per Share | Basic and diluted earnings per share are as follows (in millions, except for share and per share amounts): Three Months Ended March 31, 2022 Basic and diluted net loss per share: Numerator Net loss attributable to Alight, Inc. - basic and diluted $ ( 11 ) Denominator Weighted-average shares outstanding - basic and diluted 456,838,216 Basic and diluted net loss per share $ ( 0.02 ) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Current Reportable Segments | Information regarding the Company’s current reportable segments is as follows (in millions): Revenue Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, 2022 2021 Employer Solutions Recurring $ 570 $ 533 Project 53 54 Total Employer Solutions 623 587 Professional Services Recurring 30 29 Project 60 63 Total Professional Services 90 92 Hosted Business 12 10 Total $ 725 $ 689 There was no single client who accounted for more than 10% of the Company’s revenues in any of the periods presented. Segment Profit Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, 2022 2021 Employer Solutions $ 142 $ 136 Professional Services — — Hosted Business — ( 3 ) Total of all reportable segments 142 133 Share-based compensation 33 2 Transaction and integration expenses (1) 6 — Non-recurring professional expenses (2) — 9 Restructuring 6 7 Other (3) 3 ( 5 ) Depreciation 17 24 Intangible amortization 79 50 Operating (Loss) Income ( 2 ) 46 Gain from change in fair value of financial instruments ( 13 ) — Gain from change in fair value of tax receivable agreement ( 5 ) — Interest expense 29 62 Other (income) expense, net ( 1 ) 8 Loss Before Income Tax Expense (Benefit) $ ( 12 ) $ ( 24 ) (1) Transaction and integration expenses related to acquisition activity. (2) Non-recurring professional expenses includes external advisor and legal costs related to the Company’s Business Combination completed in 2021. (3) For the three months ended March 31, 2022, other primarily includes expenses related to debt refinancing, offset by Other income, net. For the three months ended March 31, 2021, other includes long-term incentive expenses, offset by Other expense, net. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Schedule of Swap Agreements That Will Fix the Floating Interest Rates Associated With Its Term Loan | The Company has utilized swap agreements that will fix the floating interest rates associated with its Term Loan as shown in the following table: Designation Date Effective Date Initial Notional Amount Notional Amount Outstanding as of March 31, 2022 Fixed Rate Expiration Date July 2021 August 2020 557,500,000 557,500,000 2.5069 % May 2022 July 2021 August 2020 89,863,420 101,365,120 3.0680 % February 2023 December 2021 August 2020 181,205,050 162,935,400 0.7203 % April 2024 December 2021 August 2020 388,877,200 367,997,600 0.6826 % April 2024 December 2021 May 2022 220,130,318 n/a 0.4570 % April 2024 December 2021 May 2022 306,004,562 n/a 0.4480 % April 2024 December 2021 April 2024 871,205,040 n/a 1.6533 % June 2025 December 2021 April 2024 435,602,520 n/a 1.6560 % June 2025 December 2021 April 2024 435,602,520 n/a 1.6650 % June 2025 March 2022 June 2025 1,197,000,000 n/a 2.5540 % December 2026 |
Schedule of Fair Values and Location of Outstanding Derivative Instruments Recorded in the Condensed Consolidated Balance Sheets | The fair values and location of outstanding derivative instruments recorded in the Condensed Consolidated Balance Sheets are as follows (in millions): March 31, December 31, 2022 2021 Assets Other current assets $ 18 $ 1 Other assets $ 58 $ 16 Total $ 76 $ 17 Liabilities Other current liabilities $ 3 $ 8 Other liabilities 1 1 Total $ 4 $ 9 |
Tax Receivable Agreement (Table
Tax Receivable Agreement (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Receivables [Abstract] | |
Summary of Changes of Tax Receivable Liability | The following table summarizes the changes in the TRA liabilities (in millions): Tax Receivable Agreement Liability Beginning balance as of December 31, 2021 $ 581 Measurement period adjustment ( 8 ) Fair value remeasurement ( 5 ) Conversion of noncontrolling interest 6 Ending Balance as of March 31, 2022 $ 574 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The Company’s financial assets and liabilities measured at fair value on a recurring basis are as follows (in millions): March 31, 2022 Level 1 Level 2 Level 3 Total Assets Interest rate swaps $ — $ 76 $ — $ 76 Total assets recorded at fair value $ — $ 76 $ — $ 76 Liabilities Interest rate swaps $ — $ 4 $ — $ 4 Contingent consideration liability — — 32 32 Seller Earnouts liability — — 121 121 Tax receivable agreement liability — — 568 568 Total liabilities recorded at fair value $ — $ 4 $ 721 $ 725 December 31, 2021 Level 1 Level 2 Level 3 Total Assets Interest rate swaps $ — $ 17 $ — $ 17 Total assets recorded at fair value $ — $ 17 $ — $ 17 Liabilities Interest rate swaps $ — $ 9 $ — $ 9 Contingent consideration liability — — 33 33 Seller Earnouts liability — — 135 135 Tax receivable agreement liability — — 581 581 Total liabilities recorded at fair value $ — $ 9 $ 749 $ 758 |
Summary of Changes in Deferred Contingent Consideration Liabilities | The following table summarizes the changes in deferred contingent consideration liabilities (in millions): Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, 2022 2021 Beginning balance $ 33 $ 26 Measurement period adjustments ( 2 ) 2 Accretion of contingent consideration 1 — Ending Balance $ 32 $ 28 |
Schedule of Financial Liabilities Not Measured at Fair Value on Recurring Basis | The Company’s financial liabilities not measured at fair value on a recurring basis are as follows (in millions): March 31, 2022 December 31, 2021 Carrying Value Fair Value Carrying Value Fair Value Liabilities Current portion of long-term debt, net $ 40 $ 40 $ 38 $ 38 Long-term debt, net 2,818 2,799 2,830 2,834 Total $ 2,858 $ 2,839 $ 2,868 $ 2,872 |
Restructuring and Integration (
Restructuring and Integration (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Restructuring And Related Activities [Abstract] | |
Summary of Restructuring Costs | The following table summarizes restructuring costs by type that have been incurred through March 31, 2022 and are estimated to be incurred through the end of the Plan. Estimated costs by type may be revised in future periods as these assumptions are updated: Successor Three Months Ended Estimated Estimated March 31, Inception to Remaining Total 2022 Date Costs Cost (1) Employer Solutions Severance and Related Benefits $ 2 $ 48 $ 11 $ 59 Other Restructuring Costs (2) 3 48 14 62 Total Employer Solutions $ 5 $ 96 $ 25 $ 121 Professional Services Severance and Related Benefits $ — $ 8 $ 2 $ 10 Other Restructuring Costs (2) 1 7 2 9 Total Professional Services $ 1 $ 15 $ 4 $ 19 Total Restructuring Costs $ 6 $ 111 $ 29 $ 140 (1) Actual costs, when incurred, may vary due to changes in the assumptions built into the Plan. Significant assumptions that may change when plans are finalized and implemented include, but are not limited to, changes in severance calculations, changes in the assumptions underlying sublease loss calculations due to changing market conditions, and changes in the overall analysis that might cause the Company to add or cancel component initiatives. (2) Other costs associated with the Plan primarily include consulting and legal fees and lease consolidation. |
Schedule of Accrued Restructuring Liability | As of March 31, 2022, approximately $ 5 million of the restructuring liability is unpaid and is recorded in Accounts payable and accrued liabilities on the Condensed Consolidated Balance Sheets. Severance and Related Benefits Other Restructuring Costs Total Accrued restructuring liability as of December 31, 2021 $ 4 $ — $ 4 Restructuring charges 2 4 6 Cash payments ( 3 ) ( 1 ) ( 4 ) Non-cash charges (1) — ( 1 ) ( 1 ) Accrued restructuring liability as of March 31, 2022 $ 3 $ 2 $ 5 Non-cash charges relate to lease consolidation |
Basis of Presentation and Nat_2
Basis of Presentation and Nature of Business - Additional Information (Details) | Jul. 02, 2021 | Mar. 31, 2022 |
Basis Of Presentation And Nature Of Business [Line Items] | ||
Date of incorporation | Mar. 26, 2020 | |
Foley Trasimene Acquisition Corp | ||
Basis Of Presentation And Nature Of Business [Line Items] | ||
Business combination, closing date of acquisition | Jul. 2, 2021 | |
Foley Trasimene Acquisition Corp | Alight Holdings | ||
Basis Of Presentation And Nature Of Business [Line Items] | ||
Non-voting ownership percentage held by noncontrolling interest | 14.00% | |
Alight | Foley Trasimene Acquisition Corp | Alight Holdings | ||
Basis Of Presentation And Nature Of Business [Line Items] | ||
Percentage of economic interest | 86.00% | |
Business combination, percentage of voting power | 100.00% |
Accounting Policies and Pract_3
Accounting Policies and Practices - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies And Practices [Line Items] | |
Business combination tax receivable agreement percentage of benefit deemed to realize | 85.00% |
Revenue from Contracts with C_2
Revenue from Contracts with Customers - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2022 | |
Disaggregation Of Revenue [Line Items] | |
Revenue related to unsatisfied performance obligations, description | The Company has elected to apply practical expedients to not disclose the revenue related to unsatisfied performance obligations if (1) the contract has an original duration of one year or less, or (2) the variable consideration is allocated entirely to an unsatisfied performance obligation which is recognized as a series of distinct goods and services that form a single performance obligation. |
Customer Relationships | |
Disaggregation Of Revenue [Line Items] | |
Practical expedient description | For situations where the duration of the contract is 1 year or less, the Company has applied a practical expedient and recognized the costs of obtaining a contract as an expense when incurred. These costs are recorded in Cost of services, exclusive of depreciation and amortization in the Condensed Consolidated Statements of Comprehensive Income (Loss) |
Payroll and Cloud Solutions | Customer Relationships | |
Disaggregation Of Revenue [Line Items] | |
Capitalized costs, amortization period | 7 years |
Other Solutions | Customer Relationships | |
Disaggregation Of Revenue [Line Items] | |
Capitalized costs, amortization period | 15 years |
Minimum | |
Disaggregation Of Revenue [Line Items] | |
Revenue recognition contract terms | 3 years |
Maximum | |
Disaggregation Of Revenue [Line Items] | |
Revenue recognition contract terms | 5 years |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) - USD ($) $ in Millions | Oct. 01, 2021 | Jul. 02, 2021 | Mar. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 3,627 | $ 3,638 | ||
Technology Related Intangibles | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, Useful life | 5 years 2 months 12 days | |||
Foley Trasimene Acquisition Corp | ||||
Business Acquisition [Line Items] | ||||
Consideration transferred | $ 5,002 | |||
Business combination, deferred underwriting costs related to initial public offering | 36 | |||
Business combination, fees related to PIPE Investment | 37 | |||
Business combination, acquisition-related costs | 21 | |||
Business combination, seller transaction costs | 39 | |||
Business combination, advisory and investment banker fees | 36 | |||
Business combination, certain executive compensation related expenses | 36 | |||
Goodwill | 3,374 | |||
Receivables | 484 | |||
Other current liabilities | 291 | |||
Noncontrolling interest | 799 | |||
Goodwill tax deductible | $ 1,600 | |||
Foley Trasimene Acquisition Corp | Purchase Accounting Measurement | ||||
Business Acquisition [Line Items] | ||||
Consideration transferred | $ 8 | |||
Receivables | 2 | |||
Other current liabilities | 2 | |||
Noncontrolling interest | $ 1 | |||
Foley Trasimene Acquisition Corp | Customer Related and Contract Based Intangibles | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, Useful life | 15 years | |||
Foley Trasimene Acquisition Corp | Technology Related Intangibles | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, Useful life | 6 years | |||
Retiree Health Exchange | ||||
Business Acquisition [Line Items] | ||||
Consideration transferred | $ 199 | |||
Goodwill | 78 | |||
Receivables | 1 | |||
Goodwill tax deductible | $ 78 | |||
Retiree Health Exchange | Customer Related and Contract Based Intangibles | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, Useful life | 13 years | |||
Retiree Health Exchange | Technology Related Intangibles | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets, Useful life | 5 years |
Acquisitions - Summary of Preli
Acquisitions - Summary of Preliminary Consideration Transferred (Details) - Foley Trasimene Acquisition Corp $ in Millions | Jul. 02, 2021USD ($) |
Business Acquisition [Line Items] | |
Cash consideration to prior equityholders | $ 1,055 |
Repayment of debt | 1,814 |
Total cash consideration | 2,869 |
Continuing unitholders rollover equity into the Company | 1,414 |
Consideration transferred | 5,002 |
Noncontrolling interest | 799 |
Tax Receivable Agreement | |
Business Acquisition [Line Items] | |
Contingent consideration | 610 |
Seller Earnouts | |
Business Acquisition [Line Items] | |
Contingent consideration | $ 109 |
Acquisitions - Summary of Pre_2
Acquisitions - Summary of Preliminary Consideration Transferred (Parenthetical) (Details) - Foley Trasimene Acquisition Corp - Class A Common Stock $ / shares in Units, shares in Millions, $ in Billions | Jul. 02, 2021USD ($)$ / sharesshares |
Business Acquisition [Line Items] | |
Business acquisition, equity interest issued, number of shares | shares | 141 |
Business acquisition, equity interest issued, total fair value | $ | $ 1.4 |
Business acquisition, equity interest issued, share price per share | $ / shares | $ 10 |
Acquisitions - Summary of Pre_3
Acquisitions - Summary of Preliminary Purchase Price allocation (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 | Oct. 01, 2021 | Jul. 02, 2021 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 3,627 | $ 3,638 | ||
Foley Trasimene Acquisition Corp | ||||
Business Acquisition [Line Items] | ||||
Cash and cash equivalents | $ 460 | |||
Receivables | 484 | |||
Fiduciary assets | 1,015 | |||
Other current assets | 162 | |||
Fixed assets | 205 | |||
Other assets | 425 | |||
Accounts payable and accrued liabilities | (327) | |||
Fiduciary liabilities | (1,015) | |||
Other current liabilities | (291) | |||
Debt assumed | (2,370) | |||
Deferred tax liabilities | (3) | |||
Other liabilities | (396) | |||
Intangible assets | 4,078 | |||
Total identifiable net assets | 2,427 | |||
Goodwill | $ 3,374 | |||
Retiree Health Exchange | ||||
Business Acquisition [Line Items] | ||||
Receivables | $ 1 | |||
Other current assets | 29 | |||
Accounts payable and accrued liabilities | (13) | |||
Intangible assets | 104 | |||
Fair value of net assets acquired and liabilities assumed | 121 | |||
Goodwill | 78 | |||
Total consideration | $ 199 |
Acquisitions - Summary of Pre_4
Acquisitions - Summary of Preliminary Values Allocated to Identifiable Intangible Assets and Estimated Useful Lives (Details) - USD ($) $ in Millions | Jul. 02, 2021 | Mar. 31, 2022 |
Definite Lived Trade Names | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, Useful life | 14 years 1 month 6 days | |
Technology Related Intangibles | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, Useful life | 5 years 2 months 12 days | |
Foley Trasimene Acquisition Corp | Definite Lived Trade Names | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, Fair value | $ 400 | |
Identifiable intangible assets, Useful life | 15 years | |
Foley Trasimene Acquisition Corp | Technology Related Intangibles | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, Fair value | $ 222 | |
Identifiable intangible assets, Useful life | 6 years | |
Foley Trasimene Acquisition Corp | Customer Related and Contract Based Intangibles | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Identifiable intangible assets, Fair value | $ 3,456 | |
Identifiable intangible assets, Useful life | 15 years |
Other Financial Data - Summary
Other Financial Data - Summary of Components of Receivables, Net (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Other Financial Data [Abstract] | ||
Billed and unbilled receivables | $ 553 | $ 520 |
Allowance for expected credit losses | (7) | (5) |
Balance at end of period | $ 546 | $ 515 |
Other Financial Data - Addition
Other Financial Data - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Other Financial Data [Line Items] | |||
Contract with customer, liability, revenue recognized | $ 79 | $ 79 | |
Interest Rate Swaps | |||
Other Financial Data [Line Items] | |||
Derivative asset, current | 18 | $ 1 | |
Derivative asset, noncurrent | 58 | 16 | |
Derivative liability, current | 3 | 8 | |
Derivative liability, noncurrent | 1 | 1 | |
Other Current Liabilities | |||
Other Financial Data [Line Items] | |||
Deferred compensation liability | 83 | $ 83 | |
Cost of Services, Exclusive of Depreciation and Amortization | |||
Other Financial Data [Line Items] | |||
Amortization expense | $ 12 | $ 16 |
Other Financial Data - Summar_2
Other Financial Data - Summary of Components of Other Current Assets (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Other Financial Data [Abstract] | ||
Deferred project costs | $ 40 | $ 39 |
Prepaid expenses | 60 | 66 |
Commissions receivable | 95 | 148 |
Other | 59 | 49 |
Total | $ 254 | $ 302 |
Other Financial Data - Summar_3
Other Financial Data - Summary of Components of Other Assets (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Other Financial Data [Abstract] | ||
Deferred project costs | $ 295 | $ 274 |
Operating lease right of use asset | 106 | 120 |
Commissions receivable | 28 | 34 |
Other | 81 | 44 |
Total | $ 510 | $ 472 |
Other Financial Data - Summar_4
Other Financial Data - Summary of Components of Other Current Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Other Financial Data [Abstract] | ||
Deferred revenue | $ 154 | $ 148 |
Operating lease liabilities | 45 | 44 |
Finance lease liabilities | 26 | 27 |
Other | 169 | 182 |
Total | $ 394 | $ 401 |
Other Financial Data - Summar_5
Other Financial Data - Summary of Components of Other Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Other Financial Data [Abstract] | ||
Deferred revenue | $ 54 | $ 55 |
Operating lease liabilities | 113 | 139 |
Finance lease liabilities | 29 | 34 |
Unrecognized tax positions | 44 | 44 |
Other | 71 | 81 |
Total | $ 311 | $ 353 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, Net - Summary of Changes in Net Carrying Amount of Goodwill (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Goodwill [Line Items] | |
Balance as of December 31, 2021 | $ 3,638 |
Measurement period adjustments | (10) |
Foreign currency translation | (1) |
Balance as of March 31, 2022 | 3,627 |
Employer Solutions | |
Goodwill [Line Items] | |
Balance as of December 31, 2021 | 3,564 |
Measurement period adjustments | (10) |
Foreign currency translation | (1) |
Balance as of March 31, 2022 | 3,553 |
Professional Services | |
Goodwill [Line Items] | |
Balance as of December 31, 2021 | 74 |
Balance as of March 31, 2022 | $ 74 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, Net - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible assets | $ 79 | $ 50 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, Net - Schedule of Intangible Assets by Asset Class (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Intangible Assets | ||
Intangible assets, Gross Carrying Amount | $ 4,322 | $ 4,323 |
Intangible assets, Accumulated Amortization | 232 | 153 |
Intangible assets, Net Carrying Amount | 4,090 | 4,170 |
Customer Related and Contract Based Intangibles | ||
Intangible Assets | ||
Intangible assets, Gross Carrying Amount | 3,661 | 3,662 |
Intangible assets, Accumulated Amortization | 180 | 119 |
Intangible assets, Net Carrying Amount | 3,481 | 3,543 |
Technology Related Intangibles | ||
Intangible Assets | ||
Intangible assets, Gross Carrying Amount | 254 | 254 |
Intangible assets, Accumulated Amortization | 31 | 20 |
Intangible assets, Net Carrying Amount | 223 | 234 |
Trade Name | ||
Intangible Assets | ||
Intangible assets, Gross Carrying Amount | 407 | 407 |
Intangible assets, Accumulated Amortization | 21 | 14 |
Intangible assets, Net Carrying Amount | $ 386 | $ 393 |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets, Net - Schedule of Intangible Asset Net Carrying Amount and Weighted Average Remaining Useful Lives (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Dec. 31, 2021 | |
Schedule Of Intangible Assets Other Than Goodwill [Line Items] | ||
Intangible assets, Net Carrying Amount | $ 4,090 | $ 4,170 |
Customer Related and Contract Based Intangibles | ||
Schedule Of Intangible Assets Other Than Goodwill [Line Items] | ||
Intangible assets, Net Carrying Amount | $ 3,481 | 3,543 |
Intangible assets, Weighted Average Remaining Useful Lives | 14 years 2 months 12 days | |
Technology Related Intangibles | ||
Schedule Of Intangible Assets Other Than Goodwill [Line Items] | ||
Intangible assets, Net Carrying Amount | $ 223 | 234 |
Intangible assets, Weighted Average Remaining Useful Lives | 5 years 2 months 12 days | |
Trade Name | ||
Schedule Of Intangible Assets Other Than Goodwill [Line Items] | ||
Intangible assets, Net Carrying Amount | $ 386 | $ 393 |
Intangible assets, Weighted Average Remaining Useful Lives | 14 years 1 month 6 days |
Goodwill and Intangible Asset_7
Goodwill and Intangible Assets, Net - Schedule of Intangible Assets Expected Annual Amortization Expense (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Customer Related and Contract Based Intangibles | ||
Finite Lived Intangible Assets [Line Items] | ||
2022 (April - December) | $ 183 | |
2023 | 245 | |
2024 | 245 | |
2025 | 245 | |
2026 | 245 | |
Thereafter | 2,318 | |
Intangible assets, Net Carrying Amount | 3,481 | $ 3,543 |
Technology Related Intangibles | ||
Finite Lived Intangible Assets [Line Items] | ||
2022 (April - December) | 32 | |
2023 | 43 | |
2024 | 43 | |
2025 | 43 | |
2026 | 42 | |
Thereafter | 20 | |
Intangible assets, Net Carrying Amount | 223 | 234 |
Trade Name | ||
Finite Lived Intangible Assets [Line Items] | ||
2022 (April - December) | 21 | |
2023 | 28 | |
2024 | 28 | |
2025 | 28 | |
2026 | 27 | |
Thereafter | 254 | |
Intangible assets, Net Carrying Amount | $ 386 | $ 393 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Income Tax Examination [Line Items] | ||
Effective tax rate | (12.00%) | 14.00% |
Maximum | ||
Income Tax Examination [Line Items] | ||
U.S. statutory corporate income tax rate | 21.00% |
Debt - Schedule of Debt Outstan
Debt - Schedule of Debt Outstanding (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | ||||||
Jan. 31, 2022 | Aug. 31, 2021 | Aug. 31, 2020 | May 31, 2020 | Mar. 31, 2022 | Dec. 31, 2021 | |||
Debt Instrument [Line Items] | ||||||||
Gross debt | $ 2,853 | |||||||
Total debt, net | 2,858 | $ 2,868 | ||||||
Less: current portion of long term debt, net | (40) | (38) | ||||||
Total long-term debt, net | 2,818 | 2,830 | ||||||
Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Gross debt | $ 70 | 72 | ||||||
Maturity Date | May 1, 2024 | |||||||
Term Loan, Amended | ||||||||
Debt Instrument [Line Items] | ||||||||
Gross debt | 1,958 | |||||||
Total debt, net | $ 1,986 | |||||||
Maturity Date | Oct. 31, 2026 | Oct. 31, 2026 | ||||||
Term Loan, Third Incremental | ||||||||
Debt Instrument [Line Items] | ||||||||
Gross debt | [1] | 517 | ||||||
Total debt, net | $ 525 | |||||||
Maturity Date | Aug. 31, 2028 | Aug. 31, 2028 | Aug. 31, 2028 | [1] | ||||
Term Loan, B-1 | ||||||||
Debt Instrument [Line Items] | ||||||||
Gross debt | [2] | $ 2,466 | ||||||
Maturity Date | [2] | Aug. 31, 2028 | ||||||
Secured Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Gross debt | $ 313 | 314 | ||||||
Maturity Date | Jun. 1, 2025 | Jun. 1, 2025 | ||||||
$294m Revolving Credit Facility, Amended | ||||||||
Debt Instrument [Line Items] | ||||||||
Maturity Date | Aug. 31, 2026 | Oct. 31, 2024 | Aug. 31, 2026 | |||||
Other | ||||||||
Debt Instrument [Line Items] | ||||||||
Gross debt | $ 9 | $ 7 | ||||||
Maturity Date | Jun. 30, 2022 | |||||||
[1] | The net balance for the Third Incremental Term Loan at December 31, 2021 includes unamortized debt issuance costs of $ 6 million. | |||||||
[2] | The net balance for the B-1 Term Loan at March 31, 2022 includes unamortized debt issuance costs of $ 9 million. |
Debt - Schedule of Debt Outst_2
Debt - Schedule of Debt Outstanding (Parenthetical) (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 | Aug. 31, 2021 | Aug. 31, 2020 |
Term Loan, Third Incremental | ||||
Debt Instrument [Line Items] | ||||
Unamortized debt issuance costs | $ 6 | |||
Term Loan, B-1 | ||||
Debt Instrument [Line Items] | ||||
Unamortized debt issuance costs | $ 9 | |||
$294m Revolving Credit Facility, Amended | ||||
Debt Instrument [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 294 | $ 294 | $ 226 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||
Jan. 31, 2022 | Aug. 31, 2021 | Jul. 31, 2021 | Aug. 31, 2020 | May 31, 2020 | May 31, 2017 | Mar. 31, 2022 | Mar. 31, 2021 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2019 | |||
Debt Instrument [Line Items] | |||||||||||||
Debt balance | $ 2,858,000,000 | $ 2,868,000,000 | |||||||||||
Amortization of financing fees and benefits | (1,000,000) | ||||||||||||
Interest expense related to debt instruments | 27,000,000 | $ 53,000,000 | |||||||||||
Interest Expense | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Amortization of financing fees and benefits | $ (1,000,000) | 4,000,000 | |||||||||||
Revolving Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt term | 5 years | ||||||||||||
Maturity Date | May 1, 2022 | ||||||||||||
Line of credit, maximum borrowing capacity | $ 250,000,000 | ||||||||||||
Amended Revolving Credit Facility | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Maturity Date | Aug. 31, 2026 | Oct. 31, 2024 | Aug. 31, 2026 | ||||||||||
Line of credit, maximum borrowing capacity | $ 294,000,000 | $ 226,000,000 | $ 294,000,000 | ||||||||||
Unused letters of credit | $ 4,000,000 | ||||||||||||
Proceeds from Lines of Credit | $ 0 | ||||||||||||
Other | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Maturity Date | Jun. 30, 2022 | ||||||||||||
Principal payment | $ 52,000,000 | ||||||||||||
Debt instrument, borrowings offset amount | 54,000,000 | ||||||||||||
Revolving credit facility acquired | $ 20,000,000 | ||||||||||||
Line of credit | $ 9,000,000 | ||||||||||||
Term Loan | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt term | 7 years | ||||||||||||
Repayments of principal to refinance debt | $ 270,000,000 | ||||||||||||
Maturity Date | May 1, 2024 | ||||||||||||
Repayment of principal | $ 556,000,000 | ||||||||||||
Term Loan | LIBOR | Minimum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument, variable interest rate | 2.75% | ||||||||||||
Term Loan | LIBOR | Maximum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument, variable interest rate | 3.00% | ||||||||||||
Term Loan, Amended | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt balance | $ 1,986,000,000 | ||||||||||||
Maturity Date | Oct. 31, 2026 | Oct. 31, 2026 | |||||||||||
Debt instrument, variable interest rate basis | 1‑month | ||||||||||||
Payment terms | The Company is required to make principal payments at the end of each fiscal quarter based on defined terms in the agreement with the remaining principal balances due on the maturity dates. | ||||||||||||
Principal payment | $ 8,000,000 | $ 7,000,000 | |||||||||||
Swap agreement expiration period | 2026-12 | ||||||||||||
Term Loan, Amended | Minimum | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument, variable interest rate | 0.50% | ||||||||||||
Term Loan, Third Incremental | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt balance | $ 525,000,000 | ||||||||||||
Maturity Date | Aug. 31, 2028 | Aug. 31, 2028 | Aug. 31, 2028 | [1] | |||||||||
Secured Senior Notes | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Maturity Date | Jun. 1, 2025 | Jun. 1, 2025 | |||||||||||
Payment terms | interest at a fixed rate of 5.75% per annum, payable semi-annually on June 1 and December 1 of each year | ||||||||||||
Face amount | $ 300,000,000 | ||||||||||||
Interest rate | 5.75% | ||||||||||||
Debt payment beginning date | Dec. 1, 2020 | ||||||||||||
Term Loan, B-1 | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Maturity Date | [2] | Aug. 31, 2028 | |||||||||||
Term Loan, B-1 | SOFR | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument, variable interest rate | 3.00% | ||||||||||||
[1] | The net balance for the Third Incremental Term Loan at December 31, 2021 includes unamortized debt issuance costs of $ 6 million. | ||||||||||||
[2] | The net balance for the B-1 Term Loan at March 31, 2022 includes unamortized debt issuance costs of $ 9 million. |
Debt - Schedule of Aggregate Co
Debt - Schedule of Aggregate Contractual Principal Payments (Details) $ in Millions | Mar. 31, 2022USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2022 (April - December) | $ 33 |
2023 | 31 |
2024 | 83 |
2025 | 325 |
2026 | 25 |
Thereafter | 2,356 |
Total payments | $ 2,853 |
Stockholders' and Members' Eq_3
Stockholders' and Members' Equity - Additional Information (Details) $ / shares in Units, $ in Millions | 3 Months Ended | |||
Mar. 31, 2022USD ($)Vote$ / sharesshares | Mar. 31, 2021shares | Dec. 31, 2021shares | Jul. 02, 2021shares | |
Class Of Stock [Line Items] | ||||
Preferred stock, authorized | 1,000,000 | |||
Preferred stock, par value | $ / shares | $ 0.0001 | |||
Preferred stock, issued | 0 | |||
Preferred stock, outstanding | 0 | |||
Increase in equity | $ | $ 13 | |||
Tax Receivable Agreement Liability | ||||
Class Of Stock [Line Items] | ||||
Additional TRA liability | $ | $ 6 | |||
Class A Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 465,225,352 | |||
Common stock, shares outstanding | 465,225,352 | |||
Common stock, par value | $ / shares | $ 0.0001 | |||
Common stock, shares authorized | 1,000,000,000 | |||
Conversion of stock | 1,239,256 | |||
Unvested Class A common stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 7,583,284 | |||
Common stock, shares outstanding | 7,583,284 | |||
Class B Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 9,980,906 | |||
Common stock, shares outstanding | 9,980,906 | |||
Common stock, par value | $ / shares | $ 0.0001 | |||
Issuance of common units | 14,999,998 | |||
Common stock, shares authorized | 20,000,000 | |||
Unvested Common Class B | ||||
Class Of Stock [Line Items] | ||||
Issuance of employee compensation | 808,276 | |||
Class B-1 Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 4,990,453 | |||
Common stock, shares outstanding | 4,990,453 | |||
Common stock shares related to employee compensation, unvested | 404,138 | |||
Common stock conversion, description | Class B-1 Common Stock vest and automatically convert into shares of Class A Common Stock on a 1-for-1 basis if the volume weighted average price (“VWAP”) of the shares of Class A Common Stock equals or exceeds $12.50 per share for 20 or more trading days within a consecutive 30-trading day period (or in the event of a change of control or liquidation event that implies a $12.50 per share valuation on a diluted basis). | |||
Common stock shares conversion ratio | 1 | |||
Common stock shares convertible stock price trigger | $ / shares | $ 12.50 | |||
Common stock shares convertible threshold trading days | 20 days | |||
Common stock shares convertible threshold consecutive trading days | 30 days | |||
Common stock shares convertible stock valuation price on diluted basis | $ / shares | $ 12.50 | |||
Class B-1 Common Shares | Alight Holdings | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 2,509,546 | |||
Common stock, shares outstanding | 2,509,546 | |||
Common stock conversion, description | Class B-1 common units vest and automatically convert into Class A common units of Alight Holdings on a 1-for-1 basis if the VWAP of the shares of Class A Common Stock equals or exceeds $12.50 per share for 20 or more trading days within a consecutive 30-trading day period (or in the event of a change of control or liquidation event that implies a $12.50 per share valuation on a diluted basis). | |||
Common stock shares conversion ratio | 1 | |||
Common stock shares convertible stock price trigger | $ / shares | $ 12.50 | |||
Common stock shares convertible threshold trading days | 20 days | |||
Common stock shares convertible threshold consecutive trading days | 30 days | |||
Common stock shares convertible stock valuation price on diluted basis | $ / shares | $ 12.50 | |||
Class B-2 Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 4,990,453 | |||
Common stock, shares outstanding | 4,990,453 | |||
Common stock shares related to employee compensation, unvested | 404,138 | |||
Common stock conversion, description | Class B-2 Common Stock vest and automatically convert into shares of Class A Common Stock on a 1-for-1 basis if the VWAP of the shares of Class A Common Stock equals or exceeds $15.00 per share for 20 or more trading days within a consecutive 30-trading day period (or in the event of a change of control or liquidation event that implies a $15.00 per share valuation on a diluted basis). | |||
Common stock shares conversion ratio | 1 | |||
Common stock shares convertible stock price trigger | $ / shares | $ 15 | |||
Common stock shares convertible threshold trading days | 20 days | |||
Common stock shares convertible threshold consecutive trading days | 30 days | |||
Common stock shares convertible stock valuation price on diluted basis | $ / shares | $ 15 | |||
Class B-2 Common Units | Alight Holdings | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 2,509,546 | |||
Common stock, shares outstanding | 2,509,546 | |||
Common stock conversion, description | Class B-2 common units vest and automatically convert into Class A common units of Alight Holdings on a 1-for-1 basis if the VWAP of the shares of Class A Common Stock equals or exceeds $15.00 per share for 20 or more trading days within a consecutive 30-trading day period (or in the event of a change of control or liquidation event that implies a $15.00 per share valuation on a diluted basis). | |||
Common stock shares conversion ratio | 1 | |||
Common stock shares convertible stock price trigger | $ / shares | $ 15 | |||
Common stock shares convertible threshold trading days | 20 days | |||
Common stock shares convertible threshold consecutive trading days | 30 days | |||
Common stock shares convertible stock valuation price on diluted basis | $ / shares | $ 15 | |||
Class B-3 Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 0 | |||
Common stock, shares outstanding | 0 | |||
Common stock, par value | $ / shares | $ 0.0001 | |||
Common stock, shares authorized | 10,000,000 | |||
Class V Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 76,220,431 | |||
Common stock, shares outstanding | 76,220,431 | |||
Common stock, par value | $ / shares | $ 0.0001 | |||
Common stock shares conversion ratio | 1 | |||
Common stock, shares authorized | 175,000,000 | |||
Common shares, votes per share | Vote | 1 | |||
Shares, outstanding | 76,220,431 | 77,459,687 | ||
Conversion of stock | (1,239,256) | |||
Class Z Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 5,595,577 | 8,671,507 | ||
Common stock, shares outstanding | 5,595,577 | |||
Common stock, par value | $ / shares | $ 0.0001 | |||
Common stock, shares authorized | 12,900,000 | |||
Shares, outstanding | 5,595,577 | 5,595,577 | ||
Class Z-A Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 5,046,819 | |||
Common stock, shares outstanding | 5,046,819 | |||
Class Z-B-1 Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 274,379 | |||
Common stock, shares outstanding | 274,379 | |||
Class Z-B-2 Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 274,379 | |||
Common stock, shares outstanding | 274,379 | |||
Class Z Common Units | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 3,075,930 | |||
Common stock, shares outstanding | 3,075,930 | |||
Class Z-A Common Units | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 2,774,272 | |||
Common stock, shares outstanding | 2,774,272 | |||
Class Z-B-1 Common Units | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 150,829 | |||
Common stock, shares outstanding | 150,829 | |||
Class Z-B-2 Common Units | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares issued | 150,829 | |||
Common stock, shares outstanding | 150,829 | |||
Class A Units | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares outstanding | 541,445,783 | |||
Shares, outstanding | 465,225,352 | |||
Held by non controlling interest | 76,220,431 | |||
Common Class A | ||||
Class Of Stock [Line Items] | ||||
Common units granted | 0 | |||
Common units/stock voting rights | Each holder of Class A common units is entitled to one vote per unit. | |||
Common Class A-1 Units | ||||
Class Of Stock [Line Items] | ||||
Common units granted | 643 | |||
Common units/stock voting rights | Holders of Class A-1 common units are not entitled to voting rights. | |||
Common Class B Units | ||||
Class Of Stock [Line Items] | ||||
Common units granted | 0 | |||
Common units/stock voting rights | Holders of Class B common units are not entitled to voting rights. |
Stockholders' and Members' Eq_4
Stockholders' and Members' Equity - Schedule of Changes in Outstanding Stock (Details) | 3 Months Ended | |
Mar. 31, 2022shares | ||
Common Class A | ||
Class Of Stock [Line Items] | ||
Balance, Shares | 456,282,881 | |
Conversion of noncontrolling interest | 1,239,256 | |
Shares granted upon vesting | 106,188 | |
Issuance for compensation to non-employees | 13,743 | [1] |
Balance, Shares | 457,642,068 | |
Common Class B1 | ||
Class Of Stock [Line Items] | ||
Balance, Shares | 4,990,453 | |
Balance, Shares | 4,990,453 | |
Common Class B2 | ||
Class Of Stock [Line Items] | ||
Balance, Shares | 4,990,453 | |
Balance, Shares | 4,990,453 | |
Class V Common Stock | ||
Class Of Stock [Line Items] | ||
Balance, Shares | 77,459,687 | |
Conversion of noncontrolling interest | (1,239,256) | |
Balance, Shares | 76,220,431 | |
Class Z Common Stock | ||
Class Of Stock [Line Items] | ||
Balance, Shares | 5,595,577 | |
Balance, Shares | 5,595,577 | |
[1] | Issued to certain members of the Board of Directors in lieu of cash retainer. |
Stockholders' and Members' Eq_5
Stockholders' and Members' Equity - Schedule of Changes in Accumulated Other Comprehensive Income (Loss) by Component (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2022USD ($) | ||
Foreign Currency Translation Adjustments | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Other comprehensive income (loss) before reclassifications | $ 4 | |
Tax benefit | (1) | |
Other comprehensive income (loss) before reclassifications, net of tax | 3 | |
Net current period other comprehensive income, net of tax | 3 | |
Balance | 3 | |
Interest Rate Swaps | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Balance | (8) | [1] |
Other comprehensive income (loss) before reclassifications | (53) | [1] |
Tax benefit | (14) | [1] |
Other comprehensive income (loss) before reclassifications, net of tax | (39) | [1] |
Net current period other comprehensive income, net of tax | (39) | [1] |
Balance | (47) | [1] |
Accumulated Other Comprehensive (Loss) Income | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Balance | (8) | |
Other comprehensive income (loss) before reclassifications | (49) | |
Tax benefit | (13) | |
Other comprehensive income (loss) before reclassifications, net of tax | (36) | |
Net current period other comprehensive income, net of tax | (36) | |
Balance | $ (44) | |
[1] | Reclassifications from this category are recorded in Interest expense. See Note 13 “Derivative Financial Instruments” for additional information. |
Share-Based Compensation Expe_3
Share-Based Compensation Expense - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | Dec. 31, 2021 | |
Performance-based RSUs [Member] | |||
Class Of Stock [Line Items] | |||
Aggregate grant date fair value | $ 7 | ||
Total future compensation expense | $ 222 | ||
Remaining weighted-average amortization period | 2 years | ||
RSUs [Member] | |||
Class Of Stock [Line Items] | |||
Aggregate grant date fair value | $ 43 | ||
Total future compensation expense | $ 116 | ||
Remaining weighted-average amortization period | 1 year 7 months 6 days | ||
RSUs and PRSUs[Member] | |||
Class Of Stock [Line Items] | |||
Share-based compensation | $ 33 | $ 2 | |
Service-Based Portion | Minimum | |||
Class Of Stock [Line Items] | |||
Vesting period | 2 years | ||
Service-Based Portion | Maximum | |||
Class Of Stock [Line Items] | |||
Vesting period | 5 years | ||
2021 Omnibus Incentive Plan | Time-based RSUs [Member] | |||
Class Of Stock [Line Items] | |||
Vesting period | 3 years | ||
Percentage of units granted subject to vesting requirements | 55.00% | ||
2021 Omnibus Incentive Plan | Performance-based RSUs [Member] | |||
Class Of Stock [Line Items] | |||
Percentage of units granted subject to vesting requirements | 45.00% |
Share-Based Compensation Expe_4
Share-Based Compensation Expense - Summary of Unit Activity related to RSUs (Details) | 3 Months Ended | |
Mar. 31, 2022$ / sharesshares | ||
RSUs [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning Balance | shares | 7,148,416 | [1] |
Granted | shares | 4,705,544 | [1] |
Vested | shares | (252,041) | [1] |
Forfeited | shares | (323,181) | [1] |
Ending Balance | shares | 11,278,738 | [1] |
Weighted Average Grant Date Fair Value Per Unit, Beginning Balance | $ / shares | $ 12.27 | |
Weighted Average Grant Date Fair Value Per Unit, Granted | $ / shares | 9.12 | |
Weighted Average Grant Date Fair Value Per Unit, Vested | $ / shares | 9.76 | |
Weighted Average Grant Date Fair Value Per Unit, Forfeited | $ / shares | 12.64 | |
Weighted Average Grant Date Fair Value Per Unit, Ending Balance | $ / shares | $ 10.98 | |
Performance-based RSUs [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Beginning Balance | shares | 16,743,113 | [1] |
Granted | shares | 7,905,475 | [1] |
Forfeited | shares | (603,204) | [1] |
Ending Balance | shares | 24,045,384 | [1] |
Weighted Average Grant Date Fair Value Per Unit, Beginning Balance | $ / shares | $ 11.20 | |
Weighted Average Grant Date Fair Value Per Unit, Granted | $ / shares | 10.99 | |
Weighted Average Grant Date Fair Value Per Unit, Forfeited | $ / shares | 11.93 | |
Weighted Average Grant Date Fair Value Per Unit, Ending Balance | $ / shares | $ 11.05 | |
[1] | These share totals include both unvested shares and restricted stock units. |
Earnings Per Share - Summary of
Earnings Per Share - Summary of Basic and Diluted Earnings Per Share (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($)$ / sharesshares | |
Numerator | |
Net loss attributable to Alight, Inc. - basic and diluted | $ | $ (11) |
Denominator | |
Weighted average shares outstanding - basic and diluted | shares | 456,838,216 |
Basic and diluted net loss per share | $ / shares | $ (0.02) |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2022shares | |
RSUs [Member] | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 11,137,394 |
Seller Earnouts | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 14,999,998 |
Performance-based RSUs [Member] | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 35,501,399 |
Alight Holdings | Class A Units | Noncontrolling Interest | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 76,220,431 |
Segment Reporting - Schedule of
Segment Reporting - Schedule of Current Reportable Segments by Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Revenue | $ 725 | $ 689 |
Employer Solutions | ||
Segment Reporting Information [Line Items] | ||
Revenue | 623 | 587 |
Employer Solutions | Recurring | ||
Segment Reporting Information [Line Items] | ||
Revenue | 570 | 533 |
Employer Solutions | Project | ||
Segment Reporting Information [Line Items] | ||
Revenue | 53 | 54 |
Professional Services | ||
Segment Reporting Information [Line Items] | ||
Revenue | 90 | 92 |
Professional Services | Recurring | ||
Segment Reporting Information [Line Items] | ||
Revenue | 30 | 29 |
Professional Services | Project | ||
Segment Reporting Information [Line Items] | ||
Revenue | 60 | 63 |
Hosted Business | ||
Segment Reporting Information [Line Items] | ||
Revenue | $ 12 | $ 10 |
Segment Reporting - Schedule _2
Segment Reporting - Schedule of Current Reportable Segments by Segment Profit (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | ||
Segment Reporting Information [Line Items] | |||
Segment Profit | $ 142 | $ 133 | |
Share-based compensation | 33 | 2 | |
Transaction and integration expenses | [1] | 6 | |
Non-recurring professional expenses | [2] | 9 | |
Restructuring | 6 | 7 | |
Other | [3] | 3 | (5) |
Depreciation | 17 | 24 | |
Intangible amortization expense | 79 | 50 | |
Operating (Loss) Income | (2) | 46 | |
Gain from change in fair value of financial instruments | (13) | ||
Gain from change in fair value of tax receivable agreement | (5) | ||
Interest expense | 29 | 62 | |
Other (income) expense, net | (1) | 8 | |
Loss Before Income Tax Expense (Benefit) | (12) | (24) | |
Employer Solutions | |||
Segment Reporting Information [Line Items] | |||
Segment Profit | $ 142 | 136 | |
Hosted Business | |||
Segment Reporting Information [Line Items] | |||
Segment Profit | $ (3) | ||
[1] | Transaction and integration expenses related to acquisition activity. | ||
[2] | Non-recurring professional expenses includes external advisor and legal costs related to the Company’s Business Combination completed in 2021. | ||
[3] | For the three months ended March 31, 2022, other primarily includes expenses related to debt refinancing, offset by Other income, net. For the three months ended March 31, 2021, other includes long-term incentive expenses, offset by Other expense, net. |
Derivative Financial Instrume_3
Derivative Financial Instruments - Schedule of Swap Agreements That Will Fix the Floating Interest Rates Associated With Its Term Loan (Details) - Interest Rate Swaps | 3 Months Ended |
Mar. 31, 2022USD ($) | |
July 2021 Term Loan One | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-07 |
Effective Date | 2020-08 |
Initial Notional Amount | $ 557,500,000 |
Notional Amount Outstanding as of March 31, 2022 | $ 557,500,000 |
Fixed Rate | 2.5069% |
Expiration Date | 2022-05 |
July 2021 Term Loan Two | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-07 |
Effective Date | 2020-08 |
Initial Notional Amount | $ 89,863,420 |
Notional Amount Outstanding as of March 31, 2022 | $ 101,365,120 |
Fixed Rate | 3.068% |
Expiration Date | 2023-02 |
December 2021 Term Loan One | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-12 |
Effective Date | 2020-08 |
Initial Notional Amount | $ 181,205,050 |
Notional Amount Outstanding as of March 31, 2022 | $ 162,935,400 |
Fixed Rate | 0.7203% |
Expiration Date | 2024-04 |
December 2021 Term Loan Two | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-12 |
Effective Date | 2020-08 |
Initial Notional Amount | $ 388,877,200 |
Notional Amount Outstanding as of March 31, 2022 | $ 367,997,600 |
Fixed Rate | 0.6826% |
Expiration Date | 2024-04 |
December 2021 Term Loan Three | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-12 |
Effective Date | 2022-05 |
Initial Notional Amount | $ 220,130,318 |
Fixed Rate | 0.457% |
Expiration Date | 2024-04 |
December 2021 Term Loan Four | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-12 |
Effective Date | 2022-05 |
Initial Notional Amount | $ 306,004,562 |
Fixed Rate | 0.448% |
Expiration Date | 2024-04 |
December 2021 Term Loan Five | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-12 |
Effective Date | 2024-04 |
Initial Notional Amount | $ 871,205,040 |
Fixed Rate | 1.6533% |
Expiration Date | 2025-06 |
December 2021 Term Loan Six | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-12 |
Effective Date | 2024-04 |
Initial Notional Amount | $ 435,602,520 |
Fixed Rate | 1.656% |
Expiration Date | 2025-06 |
December 2021 Term Loan Seven | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2021-12 |
Effective Date | 2024-04 |
Initial Notional Amount | $ 435,602,520 |
Fixed Rate | 1.665% |
Expiration Date | 2025-06 |
March 2022 Term Loan | |
Derivatives Fair Value [Line Items] | |
Designation Date | 2022-03 |
Effective Date | 2025-06 |
Initial Notional Amount | $ 1,197,000,000 |
Fixed Rate | 2.554% |
Expiration Date | 2026-12 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Derivative [Line Items] | |
Derivative gains included in Accumulated other comprehensive loss to be reclassified into earnings over next twelve months | $ 17 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Schedule of Fair Values and Location of Outstanding Derivative Instruments Recorded in the Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Derivatives Fair Value [Line Items] | ||
Total Assets | $ 76 | $ 17 |
Total Liabilities | 4 | 9 |
Other Current Assets | ||
Derivatives Fair Value [Line Items] | ||
Total Assets | 18 | 1 |
Other Assets | ||
Derivatives Fair Value [Line Items] | ||
Total Assets | 58 | 16 |
Other Current Liabilities | ||
Derivatives Fair Value [Line Items] | ||
Total Liabilities | 3 | 8 |
Other Liabilities | ||
Derivatives Fair Value [Line Items] | ||
Total Liabilities | $ 1 | $ 1 |
Financial Instruments - Seller
Financial Instruments - Seller Earnouts - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Financial Instruments [Abstract] | ||
Balance portion of seller earnouts | $ 1 | |
Fair value of seller earnouts | 121 | $ 135 |
Loss (gain) from change in fair value of seller earnouts | $ (14) |
Tax Receivable Agreement - Addi
Tax Receivable Agreement - Additional Information (Details) - Tax Receivable Agreement Liability $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Financing Receivable, Past Due [Line Items] | |
Federal, state and local income tax rate | 26.17% |
Additional TRA liability | $ 6 |
Discount Rate | |
Financing Receivable, Past Due [Line Items] | |
Measurement Input | 7.6 |
Tax Receivable Agreement - Summ
Tax Receivable Agreement - Summary of Changes to TRA Liability (Details) - Tax Receivable Agreement Liability $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning Balance | $ 581 |
Measurement period adjustment | (8) |
Fair value remeasurement | (5) |
Conversion of noncontrolling interest | 6 |
Ending Balance | $ 574 |
Fair Value Measurement - Schedu
Fair Value Measurement - Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Measured at Fair Value on Recurring Basis - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Assets | ||
Total assets recorded at fair value | $ 76 | $ 17 |
Liabilities | ||
Total liabilities recorded at fair value | 725 | 758 |
Interest Rate Swaps | ||
Assets | ||
Total assets recorded at fair value | 76 | 17 |
Liabilities | ||
Total liabilities recorded at fair value | 4 | 9 |
Contingent Consideration Liability | ||
Liabilities | ||
Total liabilities recorded at fair value | 32 | 33 |
Seller Earnouts Liability | ||
Liabilities | ||
Total liabilities recorded at fair value | 121 | 135 |
Tax Receivable Agreement Liability | ||
Liabilities | ||
Total liabilities recorded at fair value | 568 | 581 |
Level 2 | ||
Assets | ||
Total assets recorded at fair value | 76 | 17 |
Liabilities | ||
Total liabilities recorded at fair value | 4 | 9 |
Level 2 | Interest Rate Swaps | ||
Assets | ||
Total assets recorded at fair value | 76 | 17 |
Liabilities | ||
Total liabilities recorded at fair value | 4 | 9 |
Level 3 | ||
Liabilities | ||
Total liabilities recorded at fair value | 721 | 749 |
Level 3 | Contingent Consideration Liability | ||
Liabilities | ||
Total liabilities recorded at fair value | 32 | 33 |
Level 3 | Seller Earnouts Liability | ||
Liabilities | ||
Total liabilities recorded at fair value | 121 | 135 |
Level 3 | Tax Receivable Agreement Liability | ||
Liabilities | ||
Total liabilities recorded at fair value | $ 568 | $ 581 |
Fair Value Measurement - Summar
Fair Value Measurement - Summary of Changes in Deferred Contingent Consideration Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Business Acquisition, Contingent Consideration [Line Items] | ||
Beginning balance | $ 33 | |
Measurement period adjustments | (2) | |
Accretion of contingent consideration | 1 | |
Ending Balance | $ 32 | |
Alight Holdings | ||
Business Acquisition, Contingent Consideration [Line Items] | ||
Beginning balance | $ 26 | |
Measurement period adjustments | 2 | |
Ending Balance | $ 28 |
Fair Value Measurement - Sche_2
Fair Value Measurement - Schedule of Financial Liabilities Not Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Current portion of long term debt | $ 40 | $ 38 |
Long term debt | 2,818 | 2,830 |
Total debt, net | 2,858 | 2,868 |
Carrying Value [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Current portion of long term debt | 40 | 38 |
Long term debt | 2,818 | 2,830 |
Total debt, net | 2,858 | 2,868 |
Fair Value [Member] | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Current portion of long term debt | 40 | 38 |
Long term debt | 2,799 | 2,834 |
Total debt, net | $ 2,839 | $ 2,872 |
Fair Value Measurement - Additi
Fair Value Measurement - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Fair Value Disclosures [Abstract] | |
Fair value, assets, Level 1 to Level 2 transfers, amount | $ 0 |
Fair value, assets, Level 2 to Level 1 transfers, amount | 0 |
Fair value, liabilities, Level 1 to Level 2 transfers, amount | 0 |
Fair value, liabilities, Level 2 to Level 1 transfers, amount | 0 |
Fair value, measurement with unobservable inputs reconciliation, liability, transfers into Level 3 | 0 |
Fair Value, measurement with unobservable inputs reconciliation, liability, transfers out of Level 3 | $ 0 |
Restructuring and Integration -
Restructuring and Integration - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2022 | Dec. 31, 2021 | |
Restructuring Cost And Reserve [Line Items] | |||
Expected cumulative costs | [1] | $ 140 | |
Total expenses | 111 | ||
Accrued restructuring liability | 5 | $ 4 | |
Severance and Related Benefits | |||
Restructuring Cost And Reserve [Line Items] | |||
Accrued restructuring liability | 3 | $ 4 | |
Other Restructuring Costs | |||
Restructuring Cost And Reserve [Line Items] | |||
Accrued restructuring liability | 2 | ||
The Plan [Member] | |||
Restructuring Cost And Reserve [Line Items] | |||
Expected cumulative costs | 140 | ||
Expected annual cost savings by 2022 | 196 | ||
Total expenses | 111 | ||
The Plan [Member] | Severance and Related Benefits | |||
Restructuring Cost And Reserve [Line Items] | |||
Expected cumulative costs | 69 | ||
The Plan [Member] | Other Restructuring Costs | |||
Restructuring Cost And Reserve [Line Items] | |||
Expected cumulative costs | $ 71 | ||
[1] | Actual costs, when incurred, may vary due to changes in the assumptions built into the Plan. Significant assumptions that may change when plans are finalized and implemented include, but are not limited to, changes in severance calculations, changes in the assumptions underlying sublease loss calculations due to changing market conditions, and changes in the overall analysis that might cause the Company to add or cancel component initiatives. |
Restructuring and Integration_2
Restructuring and Integration - Summary of Restructuring Costs (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2022USD ($) | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring Costs | $ 6 | |
Inception to Date | 111 | |
Estimated Remaining Costs | 29 | |
Estimated Total Cost | 140 | [1] |
Employer Solutions | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring Costs | 5 | |
Inception to Date | 96 | |
Estimated Remaining Costs | 25 | |
Estimated Total Cost | 121 | [1] |
Employer Solutions | Severance and Related Benefits | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring Costs | 2 | |
Inception to Date | 48 | |
Estimated Remaining Costs | 11 | |
Estimated Total Cost | 59 | [1] |
Employer Solutions | Other Restructuring Costs | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring Costs | 3 | [2] |
Inception to Date | 48 | [2] |
Estimated Remaining Costs | 14 | [2] |
Estimated Total Cost | 62 | [1],[2] |
Professional Services | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring Costs | 1 | |
Inception to Date | 15 | |
Estimated Remaining Costs | 4 | |
Estimated Total Cost | 19 | [1] |
Professional Services | Severance and Related Benefits | ||
Restructuring Cost And Reserve [Line Items] | ||
Inception to Date | 8 | |
Estimated Remaining Costs | 2 | |
Estimated Total Cost | 10 | [1] |
Professional Services | Other Restructuring Costs | ||
Restructuring Cost And Reserve [Line Items] | ||
Restructuring Costs | 1 | [2] |
Inception to Date | 7 | [2] |
Estimated Remaining Costs | 2 | [2] |
Estimated Total Cost | $ 9 | [1],[2] |
[1] | Actual costs, when incurred, may vary due to changes in the assumptions built into the Plan. Significant assumptions that may change when plans are finalized and implemented include, but are not limited to, changes in severance calculations, changes in the assumptions underlying sublease loss calculations due to changing market conditions, and changes in the overall analysis that might cause the Company to add or cancel component initiatives. | |
[2] | Other costs associated with the Plan primarily include consulting and legal fees and lease consolidation. |
Restructuring and Integration_3
Restructuring and Integration - Schedule of Accrued Restructuring Liability (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2022 | Mar. 31, 2021 | ||
Restructuring Cost And Reserve [Line Items] | |||
Accrued restructuring liability, Beginning balance | $ 4 | ||
Restructuring charges | 6 | $ 7 | |
Cash payments | (4) | ||
Non-cash charges | [1] | (1) | |
Accrued restructuring liability, Ending Balance | 5 | ||
Severance and Related Benefits | |||
Restructuring Cost And Reserve [Line Items] | |||
Accrued restructuring liability, Beginning balance | 4 | ||
Restructuring charges | 2 | ||
Cash payments | (3) | ||
Accrued restructuring liability, Ending Balance | 3 | ||
Other Restructuring Costs | |||
Restructuring Cost And Reserve [Line Items] | |||
Restructuring charges | 4 | ||
Cash payments | (1) | ||
Non-cash charges | [1] | (1) | |
Accrued restructuring liability, Ending Balance | $ 2 | ||
[1] | Non-cash charges relate to lease consolidation |
Employee Benefits - Additional
Employee Benefits - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Compensation And Retirement Disclosure [Abstract] | ||
Defined contribution savings plan expenses | $ 17 | $ 16 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Purchase Obligations | |
Commitment And Contingencies [Line Items] | |
Purchase obligation, remainder of 2022 | $ 17 |
Purchase obligation, 2023 | 26 |
Purchase obligation, 2024 | 27 |
Purchase obligation, 2025 | 9 |
Purchase obligation, 2026 | 4 |
Purchase obligation, thereafter | 3 |
Service Obligations | |
Commitment And Contingencies [Line Items] | |
Service obligation, remainder of 2022 | 106 |
Service obligation, 2023 | 147 |
Service obligation, 2024 | 154 |
Service obligation, 2025 | 162 |
Service obligation, 2026 | 170 |
Service obligation, thereafter | $ 332 |
Service obligation agreement termination fees percentage | 25.00% |
Service obligation maturity period | 10 years |