Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 04, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-39565 | |
Entity Registrant Name | The Beauty Health Company | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 85-1908962 | |
Entity Address, Address Line One | 2165 Spring Street | |
Entity Address, City or Town | Long Beach | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90806 | |
City Area Code | 800 | |
Local Phone Number | 603-4996 | |
Title of 12(b) Security | Class A Common Stock, par value $0.0001 per share | |
Trading Symbol | SKIN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 143,201,041 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Central Index Key | 0001818093 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 684,208 | $ 901,886 |
Accounts receivable, net of allowances for doubtful accounts of $2,894 and $2,681 at September 30, 2022 and December 31, 2021, respectively | 83,983 | 46,824 |
Prepaid expenses and other current assets | 21,830 | 12,322 |
Income tax receivable | 705 | 4,599 |
Inventories | 101,706 | 35,261 |
Total current assets | 892,432 | 1,000,892 |
Property and equipment, net | 18,099 | 16,183 |
Right-of-use assets, net | 14,292 | 14,992 |
Intangible assets, net | 46,625 | 56,010 |
Goodwill | 122,748 | 123,694 |
Deferred income tax assets, net | 268 | 330 |
Other assets | 10,331 | 6,705 |
TOTAL ASSETS | 1,104,795 | 1,218,806 |
Current liabilities: | ||
Accounts payable | 32,576 | 29,049 |
Accrued payroll-related expenses | 20,650 | 28,662 |
Other accrued expenses | 17,111 | 14,722 |
Lease liabilities, current | 4,970 | 3,712 |
Income tax payable | 1,131 | 292 |
Total current liabilities | 76,438 | 76,437 |
Lease liabilities, non-current | 11,389 | 12,781 |
Deferred income tax liabilities, net | 3,678 | 3,561 |
Warrant liabilities | 22,295 | 93,816 |
Convertible senior notes, net | 733,086 | 729,914 |
TOTAL LIABILITIES | 846,886 | 916,509 |
Commitments (Note 13) | ||
Stockholders’ equity: | ||
Class A Common Stock, $0.0001 par value; 320,000,000 shares authorized; 143,201,041 and 150,598,047 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 15 | 16 |
Preferred Stock, $0.0001 par value; 1,000,000 shares authorized; no shares issued and outstanding at September 30, 2022 and December 31, 2021 | 0 | 0 |
Additional paid-in capital | 642,762 | 722,250 |
Accumulated other comprehensive loss | (6,725) | (1,257) |
Accumulated deficit | (378,143) | (418,712) |
Total stockholders’ equity | 257,909 | 302,297 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 1,104,795 | $ 1,218,806 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowances for doubtful accounts | $ 2,894 | $ 2,681 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 320,000,000 | 320,000,000 |
Common stock, shares issued (in shares) | 143,201,041 | 150,598,047 |
Common stock, shares outstanding (in shares) | 143,201,041 | 150,598,047 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Net sales | $ 88,792 | $ 68,147 | $ 267,743 | $ 182,197 |
Cost of sales | 27,217 | 22,072 | 82,577 | 57,131 |
Gross profit | 61,575 | 46,075 | 185,166 | 125,066 |
Operating expenses: | ||||
Selling and marketing | 39,767 | 30,451 | 121,055 | 74,530 |
Research and development | 2,167 | 1,880 | 6,998 | 6,320 |
General and administrative | 23,782 | 19,200 | 77,628 | 73,643 |
Total operating expenses | 65,716 | 51,531 | 205,681 | 154,493 |
Loss from operations | (4,141) | (5,456) | (20,515) | (29,427) |
Other (income) expense: | ||||
Interest expense, net | 3,380 | 530 | 9,997 | 8,289 |
Other (income) expense, net | (2,509) | (24) | (3,230) | 4,290 |
Change in fair value of warrant liabilities | (4,284) | 199,306 | (71,521) | 271,333 |
Change in fair value of earn-out shares liability | 0 | 10,575 | 0 | 47,100 |
Foreign currency transaction (gain) loss, net | (38) | 431 | 1,800 | 663 |
Total other (income) expense | (3,451) | 210,818 | (62,954) | 331,675 |
Income (loss) before provision for income taxes | (690) | (216,274) | 42,439 | (361,102) |
Income tax (benefit) expense | (821) | (1,129) | 1,870 | (3,305) |
Net income (loss) | 131 | (215,145) | 40,569 | (357,797) |
Comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | (1,636) | (1,537) | (5,468) | (1,818) |
Comprehensive income (loss) | $ (1,505) | $ (216,682) | $ 35,101 | $ (359,615) |
Net income (loss) per share | ||||
Basic (in dollars per share) | $ 0 | $ (1.63) | $ 0.27 | $ (4.10) |
Diluted (in dollars per share) | $ (0.03) | $ (1.63) | $ (0.20) | $ (4.10) |
Weighted average common shares outstanding | ||||
Basic (in shares) | 150,788,695 | 132,306,346 | 150,706,795 | 87,219,681 |
Diluted (in shares) | 151,417,710 | 132,306,346 | 152,018,246 | 87,219,681 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Previously reported | Retroactive application of recapitalization | Legacy Common Stock | Legacy Common Stock Previously reported | Legacy Common Stock Retroactive application of recapitalization | Legacy Preferred Stock | Legacy Preferred Stock Previously reported | Legacy Preferred Stock Retroactive application of recapitalization | Common Stock | Common Stock Previously reported | Common Stock Retroactive application of recapitalization | Additional Paid-in Capital | Additional Paid-in Capital Previously reported | Additional Paid-in Capital Retroactive application of recapitalization | Note Receivable from Stockholder | Note Receivable from Stockholder Previously reported | Note Receivable from Stockholder Retroactive application of recapitalization | Accumulated other Comprehensive Income (Loss) | Accumulated other Comprehensive Income (Loss) Previously reported | Accumulated other Comprehensive Income (Loss) Retroactive application of recapitalization | Accumulated Deficit | Accumulated Deficit Previously reported | Accumulated Deficit Retroactive application of recapitalization |
Beginning balance (in shares) at Dec. 31, 2020 | 0 | 54,358 | (54,358) | 35,501,743 | 0 | 35,501,743 | ||||||||||||||||||
Beginning Balance (in shares) at Dec. 31, 2020 | 0 | 931 | (931) | |||||||||||||||||||||
Beginning balance at Dec. 31, 2020 | $ (29,960) | $ (29,960) | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 4 | $ 0 | $ 4 | $ 13,952 | $ 13,956 | $ (4) | $ (554) | $ (554) | $ 0 | $ 242 | $ 242 | $ 0 | $ (43,604) | $ (43,604) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Stock-based compensation | 34 | 34 | ||||||||||||||||||||||
Net income (loss) | (3,274) | (3,274) | ||||||||||||||||||||||
Foreign currency translation adjustment | (5) | (5) | ||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2021 | 0 | 35,501,743 | ||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2021 | 0 | |||||||||||||||||||||||
Ending balance at Mar. 31, 2021 | (33,205) | $ 0 | $ 0 | $ 4 | 13,986 | (554) | 237 | (46,878) | ||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2020 | 0 | 54,358 | (54,358) | 35,501,743 | 0 | 35,501,743 | ||||||||||||||||||
Beginning Balance (in shares) at Dec. 31, 2020 | 0 | 931 | (931) | |||||||||||||||||||||
Beginning balance at Dec. 31, 2020 | (29,960) | $ (29,960) | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 4 | $ 0 | $ 4 | 13,952 | $ 13,956 | $ (4) | (554) | $ (554) | $ 0 | 242 | $ 242 | $ 0 | (43,604) | $ (43,604) | $ 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income (loss) | (357,797) | |||||||||||||||||||||||
Foreign currency translation adjustment | (1,818) | |||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | 133,490,012 | ||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | |||||||||||||||||||||||
Ending balance at Sep. 30, 2021 | (142,055) | $ 0 | $ 0 | $ 14 | 260,908 | 0 | (1,576) | (401,401) | ||||||||||||||||
Beginning balance (in shares) at Mar. 31, 2021 | 0 | 35,501,743 | ||||||||||||||||||||||
Beginning Balance (in shares) at Mar. 31, 2021 | 0 | |||||||||||||||||||||||
Beginning balance at Mar. 31, 2021 | (33,205) | $ 0 | $ 0 | $ 4 | 13,986 | (554) | 237 | (46,878) | ||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Reverse recapitalization transaction, net (in shares) | 89,827,310 | |||||||||||||||||||||||
Reverse recapitalization transaction, net | 183,864 | $ 9 | 183,301 | 554 | 0 | 0 | ||||||||||||||||||
Issuance of common stock pursuant to equity compensation plan (in shares) | 110,726 | |||||||||||||||||||||||
Issuance of Class A Common Stock in connection with business acquisition | 1,557 | 1,557 | ||||||||||||||||||||||
Stock-based compensation | 3,508 | 3,508 | ||||||||||||||||||||||
Net income (loss) | (139,378) | (139,378) | ||||||||||||||||||||||
Foreign currency translation adjustment | (276) | (276) | ||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2021 | 0 | 125,439,779 | ||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2021 | 0 | |||||||||||||||||||||||
Ending balance at Jun. 30, 2021 | $ 16,070 | $ 0 | $ 0 | $ 13 | 202,352 | 0 | (39) | (186,256) | ||||||||||||||||
Beginning balance (in shares) at May. 03, 2021 | 54,358 | |||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Reverse recapitalization transaction, net (in shares) | 89,827,310 | |||||||||||||||||||||||
Issuance of Earn-out Shares (in shares) | 35,000,000 | |||||||||||||||||||||||
Reverse recapitalization transaction, net (in shares) | 70,860 | |||||||||||||||||||||||
Ending balance (in shares) at May. 04, 2021 | 125,399,913 | |||||||||||||||||||||||
Beginning balance (in shares) at Jun. 30, 2021 | 0 | 125,439,779 | ||||||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Issuance of common stock pursuant to equity compensation plan (in shares) | 479,373 | |||||||||||||||||||||||
Issuance of Class A Common Stock in connection with business acquisition | $ 7,784 | 7,784 | ||||||||||||||||||||||
Issuance of Earn-out Shares (in shares) | 7,500,000 | |||||||||||||||||||||||
Issuance of Earn-out Shares | 136,575 | $ 1 | 136,574 | |||||||||||||||||||||
Reverse recapitalization transaction, net (in shares) | 70,860 | |||||||||||||||||||||||
Reverse recapitalization transaction, net | (734) | (734) | ||||||||||||||||||||||
Purchase of capped calls related to Convertible Senior Notes | (90,150) | (90,150) | ||||||||||||||||||||||
Stock-based compensation | 5,082 | 5,082 | ||||||||||||||||||||||
Net income (loss) | (215,145) | (215,145) | ||||||||||||||||||||||
Foreign currency translation adjustment | (1,537) | (1,537) | ||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | 133,490,012 | ||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | |||||||||||||||||||||||
Ending balance at Sep. 30, 2021 | $ (142,055) | $ 0 | $ 0 | $ 14 | 260,908 | $ 0 | (1,576) | (401,401) | ||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | 150,598,047 | 150,598,047 | ||||||||||||||||||||||
Beginning Balance (in shares) at Dec. 31, 2021 | 0 | |||||||||||||||||||||||
Beginning balance at Dec. 31, 2021 | $ 302,297 | $ 16 | 722,250 | (1,257) | (418,712) | |||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units (in shares) | 5,184 | |||||||||||||||||||||||
Stock-based compensation | 7,049 | 7,049 | ||||||||||||||||||||||
Net income (loss) | 32,507 | 32,507 | ||||||||||||||||||||||
Foreign currency translation adjustment | (145) | (145) | ||||||||||||||||||||||
Ending balance (in shares) at Mar. 31, 2022 | 150,603,231 | |||||||||||||||||||||||
Ending balance at Mar. 31, 2022 | $ 341,708 | $ 16 | 729,299 | (1,402) | (386,205) | |||||||||||||||||||
Beginning balance (in shares) at Dec. 31, 2021 | 150,598,047 | 150,598,047 | ||||||||||||||||||||||
Beginning Balance (in shares) at Dec. 31, 2021 | 0 | |||||||||||||||||||||||
Beginning balance at Dec. 31, 2021 | $ 302,297 | $ 16 | 722,250 | (1,257) | (418,712) | |||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Net income (loss) | 40,569 | |||||||||||||||||||||||
Foreign currency translation adjustment | $ (5,468) | |||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | 143,201,041 | 143,201,041 | ||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | 0 | |||||||||||||||||||||||
Ending balance at Sep. 30, 2022 | $ 257,909 | $ 15 | 642,762 | (6,725) | (378,143) | |||||||||||||||||||
Beginning balance (in shares) at Mar. 31, 2022 | 150,603,231 | |||||||||||||||||||||||
Beginning balance at Mar. 31, 2022 | 341,708 | $ 16 | 729,299 | (1,402) | (386,205) | |||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Issuance of common stock pursuant to equity compensation plan (in shares) | 28,733 | |||||||||||||||||||||||
Issuance of Class A Common Stock in connection with business acquisition | 500 | 500 | ||||||||||||||||||||||
Issuance of common stock pursuant to equity compensation plan (in shares) | 252,536 | |||||||||||||||||||||||
Stock-based compensation | 6,378 | 6,378 | ||||||||||||||||||||||
Shares withheld for tax withholdings on vested stock awards (in shares) | (29,475) | |||||||||||||||||||||||
Shares withheld for tax withholdings on vested stock awards | (495) | (495) | ||||||||||||||||||||||
Net income (loss) | 7,931 | 7,931 | ||||||||||||||||||||||
Foreign currency translation adjustment | (3,687) | (3,687) | ||||||||||||||||||||||
Ending balance (in shares) at Jun. 30, 2022 | 150,855,025 | |||||||||||||||||||||||
Ending balance at Jun. 30, 2022 | 352,335 | $ 16 | 735,682 | (5,089) | (378,274) | |||||||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||||||
Issuance of common stock pursuant to equity compensation plan (in shares) | 64,775 | |||||||||||||||||||||||
Purchase of equity forward contract in connection with accelerated share repurchase | (20,000) | (20,000) | ||||||||||||||||||||||
Stock-based compensation | 7,449 | 7,449 | ||||||||||||||||||||||
Shares withheld for tax withholdings on vested stock awards (in shares) | (26,451) | |||||||||||||||||||||||
Shares withheld for tax withholdings on vested stock awards | (370) | (370) | ||||||||||||||||||||||
Repurchase and retirement of common stock (in shares) | (7,692,308) | |||||||||||||||||||||||
Repurchase and retirement of common stock | (80,000) | $ (1) | (79,999) | |||||||||||||||||||||
Net income (loss) | 131 | 131 | ||||||||||||||||||||||
Foreign currency translation adjustment | $ (1,636) | (1,636) | ||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | 143,201,041 | 143,201,041 | ||||||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2022 | 0 | |||||||||||||||||||||||
Ending balance at Sep. 30, 2022 | $ 257,909 | $ 15 | $ 642,762 | $ (6,725) | $ (378,143) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 40,569 | $ (357,797) |
Adjustments to reconcile net income (loss) to net cash from operating activities | ||
Depreciation of property and equipment | 5,269 | 2,446 |
Amortization of capitalized software | 1,463 | 956 |
Provision for doubtful accounts | 1,670 | 758 |
Non-cash lease expense | 3,547 | 0 |
Amortization of intangible assets | 9,600 | 8,384 |
Amortization of other assets | 525 | 99 |
Amortization of deferred financing costs | 0 | 3,005 |
Stock-based compensation | 20,876 | 8,624 |
Loss on sale and disposal of long-lived assets | 4,697 | 0 |
In-kind interest | 0 | 4,130 |
Deferred income tax benefit | 32 | (5,330) |
Change in fair value of earn-out shares liability | 0 | 47,100 |
Change in fair value adjustment of warrant liabilities | (71,521) | 271,333 |
Debt prepayment expense | 0 | 2,014 |
Amortization of debt issuance costs | 3,172 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (40,630) | (17,290) |
Prepaid expense and other current assets | (11,157) | (4,503) |
Income taxes receivable | 4,434 | (336) |
Inventory | (69,340) | (2,499) |
Other assets | (5,408) | (2,009) |
Accounts payable | 7,059 | (8,048) |
Accrued payroll and other expenses | (4,085) | 15,624 |
Other long-term liabilities | 0 | (100) |
Lease liabilities | (2,817) | 0 |
Income taxes payable | 838 | 1,799 |
Net cash used in operating activities | (101,207) | (31,640) |
Cash flows used in investing activities: | ||
Capital expenditures for intangible assets | (4,690) | (2,229) |
Capital expenditures for property and equipment | (9,880) | (4,857) |
Cash paid for business acquisitions, net of cash acquired | 0 | (22,896) |
Cash paid for asset acquisition | (1,475) | 0 |
Repayment of notes receivables from shareholders | 0 | 781 |
Net cash used in investing activities | (16,045) | (29,201) |
Cash flows from financing activities: | ||
Repurchase of Class A Common Shares | (80,000) | 0 |
Payment for equity forward contract in connection with accelerated share repurchase | 20,000 | 0 |
Payment of contingent consideration related to acquisitions | (2,763) | |
Proceeds from issuance of convertible senior notes | 0 | 750,000 |
Purchase of capped calls related to convertible senior notes | 0 | (90,150) |
Proceeds from revolving facility | 0 | 5,000 |
Repayment of revolving facility | 0 | (5,000) |
Payment of debt issuance costs | 0 | (21,341) |
Repayment of term loan | 0 | (225,486) |
Proceeds from Business Combination, net of transaction costs (See Note 3) | 0 | 357,802 |
Net cash (used in) provided by financing activities | (102,763) | 770,825 |
Net (decrease) increase in cash and cash equivalents | (220,015) | 709,984 |
Effect of foreign currency translation on cash | 2,337 | (848) |
Cash and cash equivalents, beginning of period | 901,886 | 9,486 |
Cash and cash equivalents, end of period | 684,208 | 718,622 |
Supplemental disclosures of cash flow information and non-cash investing and financing activities: | ||
Cash paid for interest | 5,130 | 10,249 |
Common stock issued for asset acquisition | 500 | 0 |
Cash (received) paid for income taxes | (2,009) | 188 |
Capital expenditures included in accounts payable | 1,755 | 512 |
Common stock issued for business acquisitions | 0 | 1,557 |
Issuance of earn-out shares | 0 | 136,575 |
Trade receivables due from seller | 0 | 6,623 |
Notes payable to seller | 0 | 2,153 |
Change in deferred tax liability due to reverse recapitalization | $ 0 | $ 90 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business The Beauty Health Company, formerly known as Vesper Healthcare Acquisition Corp. (the “Company” or “BeautyHealth”), was incorporated in Delaware on July 8, 2020. The Company was originally formed for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. On May 4, 2021 (the “Closing Date”), the Company consummated the previously announced business combination pursuant to that certain Agreement and Plan of Merger, dated December 8, 2020 (the “Merger Agreement”), by and among Vesper Healthcare Acquisition Corp. (“Vesper”), Hydrate Merger Sub I, Inc. (“Merger Sub I”), Hydrate Merger Sub II, LLC (“Merger Sub II”), LCP Edge Intermediate, Inc., the indirect parent of Edge Systems LLC d/b/a The Hydrafacial Company (“Hydrafacial”), and LCP Edge Holdco, LLC (“LCP,” or “Former Parent,” and, in its capacity as the stockholders’ representative, the “Stockholders’ Representative”), which provided for: (a) the merger of Merger Sub I with and into Hydrafacial, with Hydrafacial continuing as the surviving corporation (the “First Merger”), and (b) immediately following the First Merger and as part of the same overall transaction as the First Merger, the merger of Hydrafacial with and into Merger Sub II, with Merger Sub II continuing as the surviving entity (the “Second Merger” and, together with the First Merger, the “Mergers” and, together with the other transactions contemplated by the Merger Agreement, the “Business Combination”). As a result of the First Merger, the Company owns 100% of the outstanding common stock of Hydrafacial and each share of common stock and preferred stock of Hydrafacial has been cancelled and converted into the right to receive a portion of the consideration payable in connection with the Mergers. As a result of the Second Merger, the Company owns 100% of the outstanding interests in Merger Sub II. In connection with the closing of the Business Combination (the “Closing”), the Company owns, directly or indirectly, 100% of the stock of Hydrafacial and its subsidiaries and the stockholders of Hydrafacial as of immediately prior to the effective time of the First Merger (the “Hydrafacial Stockholders”) hold a portion of the Company’s Class A Common Stock, par value $0.0001 per share (the “Class A Common Stock”). In connection with the Closing, the Company changed its name from “Vesper Healthcare Acquisition Corp.” to “The Beauty Health Company.” Following the Closing, on May 6, 2021, the Company’s Class A Common Stock and publicly traded warrants were listed on the Nasdaq Capital Market (“Nasdaq”) under the symbols, “SKIN” and “SKINW”, respectively. The transactions set forth in the Merger Agreement constitute a “Business Combination” as contemplated by Vesper’s Second Amended and Restated Certificate of Incorporation. Unless the context otherwise requires, in this Quarterly Report on Form 10-Q, the “Company” refers to Vesper Healthcare Acquisition Corp. prior to the closing of the Business Combination and to the combined company and its subsidiaries following the Closing and “Hydrafacial” refers to the business of LCP Edge Intermediate, Inc. and its subsidiaries prior to the Closing. References to “Vesper” refer to Vesper Healthcare Acquisition Corp. prior to the consummation of the Business Combination. The Company is a category-creating beauty health company focused on bringing innovative products to market. The Company and its subsidiaries design, develop, manufacture, market, and sell a/esthetic technologies and products. The Company’s flagship brand, Hydrafacial, is a non-invasive and approachable beauty health platform and ecosystem. Hydrafacial uses a unique delivery system to cleanse, extract, and hydrate with their patented hydradermabrasion technology and serums that are made with nourishing ingredients. The COVID-19 pandemic has had, and may continue to have adverse impacts on our business. As government authorities around the world continue to implement significant measures intended to control the spread of the virus and institute restrictions on commercial operations, while simultaneously implementing policies designed to reopen certain markets, we are working to ensure our compliance and maintain business continuity for essential operations. The extent to which the COVID-19 pandemic impacts our business going forward will depend on numerous factors we cannot reliably predict, including the duration and scope of the pandemic; businesses and individuals’ actions in response to the pandemic; and the impact on economic activity including the possibility of recession or financial market instability. Basis of Presentation The accompanying unaudited interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. These statements reflect all normal and recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of the Company for the interim periods presented. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in, or presented as exhibits to, the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting PoliciesInformation regarding the Company’s significant accounting policies is contained in Note 2, “Summary of Significant Accounting Policies”, to the consolidated financial statements included in the Company’s Annual Report on Form 10-K filed with the SEC on March 1, 2022. New Accounting Pronouncements Not Yet Adopted In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU 2021-08, Business Combinations (Topic 805), which primarily relates to the accounting for contract assets and contract liabilities from contracts with customers in a business combination. The standard will be effective for annual reporting periods beginning after December 31, 2022, including interim reporting periods within those periods, with early adoption permitted. We are currently evaluating the impact of adopting this new accounting guidance on our consolidated financial statements. |
Business Combinations and Asset
Business Combinations and Asset Acquisitions | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations and Asset Acquisitions | Business Combinations and Asset Acquisitions Business Combination — Reverse Recapitalization The closing of the Business Combination occurred on May 4, 2021. In connection with the Business Combination: • Certain accredited investors (the “PIPE Investors”) entered into subscription agreements (the “PIPE Subscription Agreements”) pursuant to which the PIPE Investors agreed to purchase 35,000,000 shares (the “PIPE Shares”) of the Company’s Class A Common Stock at a purchase price per share of $10.00 for an aggregate purchase price of $350.0 million (the “PIPE Investment”). The PIPE Investment was consummated substantially concurrently with the Closing of the Business Combination. • Prior to the Business Combination, the Company issued an aggregate of 11,500,000 shares of the Company’s Class B Common Stock (the “Founder Shares”) to the Sponsor for an aggregate purchase price of $25,000 in cash. All outstanding Founder Shares were automatically converted into shares of the Company’s Class A Common Stock on a one-for-one basis at the Closing and will continue to be subject to the transfer restrictions applicable to such shares of Founder Shares. • In connection with the Closing, holders of 2,672,690 shares of the Company’s Class A Common Stock exercised their rights for the Company to redeem their respective shares for cash at an approximate price of $10.00 per share, for an aggregate of approximately $26.7 million, which was paid to such holders at Closing. • Immediately after giving effect to the Merger and the PIPE Investment, there were 125,329,053 shares of the Company’s Class A Common Stock issued and outstanding. • The aggregate gross cash consideration received by the Company in connection with the Business Combination was $783 million, which consisted of proceeds of $350 million from the PIPE Investment, plus approximately $433 million of cash from the Company’s trust account that held the proceeds from the Company’s initial public offering (the “Trust Account”). The aggregate gross cash consideration received was reduced by $368 million, which consisted of cash payments made to the former shareholders of Hydrafacial, and further reduced by an additional $57 million for the payment of direct transaction costs incurred by Hydrafacial and the Company which were reflected as a reduction of proceeds. The Company used the net proceeds to repay all of its outstanding indebtedness at the Closing. The remainder of the consideration paid to the Hydrafacial Stockholders consisted of 35,501,743 newly issued shares of Class A Common Stock (the “Stock Consideration”). The net cash received from the Business Combination was The following table reconciles the elements of the Business Combination to the Company’s Consolidated Statements of Cash Flows and the Consolidated Statements of Stockholders’ Equity (Deficit) for the year ended December 31, 2021: (in thousands) Recapitalization Cash in trust, net of redemptions $ 433,382 Cash — PIPE 350,000 Less: Cash paid out to Former Parent (367,870) Less: Transaction costs and advisory fees (56,976) Less: Cash paid out from net working capital adjustment related to acquisitions (902) Net Cash Received from Business Combination $ 357,634 The number of shares of Class A Common Stock issued following the consummation of the Business Combination: Number of Shares Class A common stock outstanding prior to Business Combination 46,000,000 Less: Redemption of Vesper Class A Common Stock (2,672,690) Class A common stock of Vesper 43,327,310 Founder shares (Vesper Class B Common Stock) 11,500,000 PIPE Shares 35,000,000 Business Combination and PIPE shares 89,827,310 Legacy Hydrafacial shares (1) 35,501,743 Working capital adjustment Class A Common Stock issued 70,860 Total Shares of Class A Common Stock after Business Combination 125,399,913 _______________ (1) The number of Legacy Hydrafacial shares was determined from the 54,358 shares of Hydrafacial common stock outstanding immediately prior to the closing of the Business Combination multiplied by the Exchange Ratio of 653.109. Distributor Acquisitions On June 4, 2021, the Company acquired High Tech Laser, Australia Pty Ltd (“HTL”), a distributor of the Company’s products in Australia. On July 1, 2021, the Company acquired Wigmore Medical France (“Wigmore”), Ecomedic GmbH (“Ecomedic”) and Sistemas Dermatologicos Internacionales (“Sidermica”), distributors of the Company’s products in France, Germany and Mexico, respectively. Through these acquisitions, the Company plans to directly sell to the respective markets and improve services for its products. Cash paid for the four distributors totaled $23.7 million. The Company applied the acquisition method of accounting and established a new basis of accounting on the dates of the respective acquisitions. The assets acquired by the Company are accordingly measured at their estimated fair values as of the acquisition date. The goodwill arising from the acquisitions consists largely of the business reputation of the acquired company in the marketplace and its assembled workforce. The goodwill is not deductible for income tax purposes. The Company finalized the valuation of assets acquired and liabilities assumed for the distributor acquisitions as of June 30, 2022. The following table summarizes the consideration and fair values assigned to the assets acquired and liabilities assumed at the dates of acquisition for the Wigmore, Ecomedic and Sidermica acquisitions and summarizes the HTL acquisition after measurement period adjustments. (in thousands) HTL Wigmore (2) Ecomedic (3) Sidermica (4) Consideration paid: Cash, net of cash acquired $ 4,920 $ 2,540 $ 11,338 $ 6,861 Class A Common Stock issued (1) 1,557 456 6,513 815 Trade receivables due from seller 1,027 2,336 1,679 1,581 Notes payable to seller — — 2,153 — $ 7,504 $ 5,332 $ 21,683 $ 9,257 Identifiable assets acquired and liabilities assumed Accounts receivable $ 1,110 $ 2,079 $ 15 $ 1,657 Non-compete agreement 100 60 588 100 Customer relationships 2,696 2,276 5,487 2,700 Inventory and other assets 354 341 1,262 454 Accounts payable (45) (456) (772) — Deferred tax liabilities, net (675) (842) (2,008) — Accrued and other liabilities (802) (317) (340) — Total identifiable net assets 2,738 3,141 4,232 4,911 Goodwill $ 4,766 $ 2,191 $ 17,451 $ 4,346 ___________ (1) Class A Common Stock issued as consideration for the acquisitions was 110,726, 28,157, 401,021 and 50,195 shares for HTL, Wigmore, Ecomedic and Sidermica, respectively. (2) During the fourth quarter of 2021, adjustments were made to the Wigmore valuation pertaining to contingent consideration and intangible assets. Goodwill was adjusted due to an increase of $0.3 million in contingent consideration and a decrease of $1.0 million in intangible assets. Contingent consideration payments for the Wigmore acquisition were paid during the three months ended March 31, 2022. (3) During the first quarter of 2022, adjustments were made to the Ecomedic valuation pertaining to acquisition date tax liability. Goodwill was adjusted due to an increase of $0.2 million to acquisition date tax liability. (4) During the second quarter of 2022, adjustments were made to the Sidermica valuation pertaining to contingent consideration. Goodwill was adjusted due to an increase in contingent consideration of $1.98 million. Contingent consideration payments for the Sidermica acquisition were paid during the three months ended June 30, 2022. Intangible assets acquired included customer relationships and non-compete agreements. The valuation of the acquired intangible asset was estimated by performing projections of discounted cash flows, whereby revenues and costs associated with each intangible asset are forecasted to derive expected cash flow which is discounted to present value at discount rates commensurate with perceived risk. The valuation and projection process is inherently subjective and relies on significant unobservable inputs (Level 3 inputs). The weighted average amortization period of customer relationship was 5 years, while the non-compete agreements are amortized over 3 years. The operating results of the distributor acquisitions from the dates of acquisitions through September 30, 2022 are included in the Condensed Consolidated Statements of Comprehensive Income (Loss). The operating results are not material to the consolidated financial statements, and, therefore, the Company has not presented pro forma results of operations for the distributor acquisitions. Acquisition of The Personalized Beauty Company, Inc. (“Mxt”) On April 12, 2022, the Company, through its indirect, wholly-owned subsidiary, Edge Systems Intermediate, LLC, acquired The Personalized Beauty Company, Inc., a Delaware corporation d.b.a. Mxt. Consideration paid in the aggregate was $1.5 million plus equity consideration of $0.5 million or 28,733 shares of the Company’s Class A Common Stock. Depending on the achievement of certain revenue milestones, the former Mxt shareholders are entitled to receive up to $30 million of earnout payments. The estimated fair value of the earnout was not material as of the acquisition date and as of September 30, 2022. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company has determined that each of its products is distinct and represents a separate performance obligation. The customer can benefit from each product on its own or together with other resources that are readily available to the customer. The products are separately identifiable from other promises in the contract. Control over the Company’s products generally transfers to the customer upon shipment of the products from the Company’s warehouse facility. Therefore, revenue associated with product purchases is recognized at a point in time upon shipment to the intended customer. Typical payment terms provide for the customer to pay within 30 to 120 days, however, we provide an option for qualified customers to pay for delivery systems over 12 monthly installments. Disaggregated Revenue The Company generates revenue through manufacturing and selling Hydrafacial Delivery Systems (“ Delivery Systems ”). In conjunction with the sale of Delivery Systems, Hydrafacial also sells its serum solutions and consumables (collectively “ Consumables ”). Consumables are sold solely and exclusively by Hydrafacial and are available for purchase separately from the purchase of Delivery Systems. For both Delivery Systems and Consumables, revenue is recognized upon transfer of control to the customer, which generally takes place at the point of shipment. The Company’s revenue disaggregated by major product line consists of the following for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Net Sales Delivery Systems $ 49,094 $ 36,182 $ 155,524 $ 96,798 Consumables 39,698 31,965 112,219 85,399 Total net sales $ 88,792 $ 68,147 $ 267,743 $ 182,197 See Note 17 for revenue disaggregated by geographical region. |
Balance Sheet Components
Balance Sheet Components | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Balance Sheet Components | Balance Sheet Components Inventories consist of the following as of the periods indicated: (in thousands) September 30, 2022 December 31, 2021 Raw materials $ 26,015 $ 12,024 Finished goods 75,691 23,237 Total inventories $ 101,706 $ 35,261 Accrued payroll-related expenses consist of the following as of the periods indicated: (in thousands) September 30, 2022 December 31, 2021 Accrued compensation $ 3,733 $ 15,262 Accrued payroll taxes 2,109 922 Accrued benefits 5,026 3,022 Accrued sales commissions 9,782 9,456 Total accrued payroll-related expenses $ 20,650 $ 28,662 Other accrued expenses consist of the following as of the periods indicated: (in thousands) September 30, 2022 December 31, 2021 Sales and VAT tax payables $ 5,116 $ 5,817 Accrued interest 4,687 2,786 Contingent consideration — 783 Note payable due seller 2,144 2,153 Royalty liabilities 1,353 1,074 Other 3,811 2,109 Total other accrued expenses $ 17,111 $ 14,722 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Leases | Leases The Company does not own any real estate. The majority of the Company’s lease liability consists of the Company’s international office spaces and warehouses, all of which are classified as operating leases. The Company’s finance leases relate to leased equipment such as office and warehouse equipment. The finance lease balances are not material and are included in property and equipment, other accrued expenses, and other long-term liabilities of the Condensed Consolidated Balance Sheets. During the nine months ended September 30, 2022 the Company entered into leases for a new experience center in Paris for a right-of-use asset and lease liability of $1.1 million as of lease inception commencement date and an office in Frankfurt for a right-of-use asset and liability of $1.6 million as of lease inception commencement date. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company follows the guidance in ASC 820 for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period, and non-financial assets and liabilities that are re-measured and reported at fair value at least annually. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. Level 3: Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 2022, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value. As of the Business Combination date, the Private Placement Warrants were valued using the Public Warrant Price, and was considered to be a Level 2 financial instrument as of that date. As of September 30, 2022, the value of the Private Placement Warrants was determined using their redemption value because these Private Placement Warrants are subject to redemption if the reference value of the common stock, as defined, is between $10.00 and $18.00 per share. The Private Placement Warrants are classified as a Level 2 financial instrument. There were no Public Warrants outstanding as of September 30, 2022. Fair Value Measurements on a Recurring Basis (in thousands) Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents: Money market funds $ 642,445 $ — $ — $ 642,445 Liabilities Warrant liability — Private Placement Warrants — 22,295 — 22,295 Money Market Funds The Company’s investment in money market funds that are classified as cash equivalents hold underlying investments with a weighted average maturity of 90 days or less and are recognized at fair value. The valuations of these securities are based on quoted prices in active markets for identical assets, when available, or pricing models whereby all significant inputs are observable or can be derived from or corroborated by observable market data. The Company reviews security pricing and assesses liquidity on a quarterly basis. As of September 30, 2022 , the Company’s U.S. portfolio had no material exposure to money market funds with a fluctuating net asset value. Warrant Liabilities The Public Warrants and Private Placement Warrants (collectively, the “Warrants”) were accounted for as liabilities in accordance with ASC 815-40 and are presented within Warrant liabilities on the Company’s Condensed Consolidated Balance Sheets. The Warrants are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liabilities in the Company’s Condensed Consolidated Statements of Comprehensive Income (Loss) . At September 30, 2022 , the outstanding Private Placement Warrants was determined using their redemption value because these Warrants are subject to redemption if the reference value of the common stock, as defined, is between $10.00 and $18.00 per share. The Private Placement Warrants are classified as a Level 2 financial instruments as of September 30, 2022 . There were no Public Warrants outstanding as of September 30, 2022. |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and Equipment, net Property and equipment consist of the following as of the periods indicated: (in thousands) Useful life (years) September 30, 2022 December 31, 2021 Furniture and fixtures 2-7 $ 4,640 $ 4,074 Computers and equipment 3-5 4,600 4,010 Machinery and equipment 2-5 5,796 3,669 Autos and trucks 5 1,220 1,163 Tooling 5 594 1,389 Leasehold improvements Shorter of remaining lease 10,127 5,086 Total property and equipment 26,977 19,391 Less: accumulated depreciation and amortization (11,221) (8,561) Construction in progress 2,343 5,353 Property and equipment, net $ 18,099 $ 16,183 During the three and nine months ended September 30, 2022, the Company recorded a loss on the disposal of property and equipment, net of $1.8 million. The loss on disposal of property and equipment, net was recorded in the condensed consolidated statements of comprehensive income (loss) primarily in general and administrative expense. Depreciation expense was as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Cost of sales $ 588 $ 339 $ 1,593 $ 965 General and administrative 927 689 2,463 1,481 Selling and marketing 486 — 1,213 — Total depreciation expense $ 2,001 $ 1,028 $ 5,269 $ 2,446 |
Goodwill and Intangible Assets,
Goodwill and Intangible Assets, net | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets, net | Goodwill and Intangible Assets, net The gross carrying amount and accumulated amortization of the Company’s intangible assets, net, as of September 30, 2022 were as follows: (in thousands) Gross Accumulated Net Carrying Estimated Trademarks $ 10,839 $ (3,950) $ 6,889 15 Non-compete agreement 758 (707) 51 3 Customer relationships 17,137 (6,132) 11,005 5-10 Developed technology 73,188 (51,825) 21,363 3-8 Patents 2,187 (385) 1,802 3-19 Capitalized software 6,706 (1,191) 5,515 3-5 Total intangible assets $ 110,815 $ (64,190) $ 46,625 During the three and nine months ended September 30, 2022, the Company recorded a loss on the disposal of intangible assets of $2.9 million. The loss on disposal of intangible assets was recorded in the condensed consolidated statements of comprehensive income (loss) primarily in general and administrative expense. The gross carrying amount and accumulated amortization of the Company’s intangible assets, net, as of December 31, 2021 were as follows: (in thousands) Gross Accumulated Net Carrying Estimated Trademarks $ 10,048 $ (3,442) $ 6,606 15 Non-compete agreement 809 (139) 670 3 Customer relationships 18,625 (4,391) 14,234 5-10 Developed technology 70,900 (45,051) 25,849 8 Patents 2,050 (295) 1,755 3-19 Capitalized software 9,867 (2,971) 6,896 3-5 Total intangible assets $ 112,299 $ (56,289) $ 56,010 Amortization expense was as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Cost of sales $ 2,245 $ 2,233 $ 6,864 $ 6,697 General and administrative 858 500 2,356 1,464 Selling and marketing 589 770 1,843 1,193 Total amortization expense $ 3,692 $ 3,503 $ 11,063 $ 9,354 The changes in the carrying value of goodwill are as follows: Nine Months Ended September 30, (in thousands) 2022 2021 Beginning balance $ 123,694 $ 98,531 Measurement period adjustments 2,154 25,304 Foreign currency translation impact (3,100) (970) Ending balance $ 122,748 $ 122,865 The measurement period adjustments include a $0.2 million increase due to adjustment of acquisition date tax liability for Ecomedic and a $1.98 million increase due to contingent consideration paid to former owner of Sidermica during the six months ended June 30, 2022 |
Long-term Debt
Long-term Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-term Debt Credit Facility On December 30, 2021, Edge Systems LLC, a California limited liability company (the “Borrower”) and an indirect wholly owned subsidiary of The Beauty Health Company, as borrower, entered into a Credit Agreement (the “Credit Agreement”) with Edge Systems Intermediate LLC, an indirect wholly owned subsidiary of the Company and the direct parent of the Borrower that holds the Company’s foreign and domestic operating entities, and The Hydrafacial Company Mexico Holdings, LLC, a direct wholly owned subsidiary of the Borrower that conducts the Mexican business operations , as guarantors (the “Guarantors” and, together with the Borrower, the “Loan Parties”), and JPMorgan Chase Bank, N.A., as administrative agent. The Credit Agreement provides for a $50 million revolving credit facility with a maturity date of December 30, 2026. In addition, the Borrower has the ability from time to time to increase the revolving commitments or enter into one or more tranches of term loans up to an additional aggregate amount not to exceed $50 million, subject to receipt of lender commitments and certain conditions precedent. As of September 30, 2022 the Credit Agreement remains undrawn and there is no outstanding balance under the revolving credit facility. Borrowings under the Credit Agreement are secured by certain collateral of the Loan Parties and are guaranteed by the Guarantors, each of whom will derive substantial benefit from the revolving credit facility. In specified circumstances, additional guarantors are required to be added. The Credit Agreement contains various restrictive covenants subject to certain exceptions, including limitations on the Borrower’s ability to incur indebtedness and certain liens, make certain investments, become liable under contingent obligations in certain circumstances, make certain restricted payments, make certain dispositions within guidelines and limits, engage in certain affiliate transactions, alter its fundamental business or make certain fundamental changes, and requirements to maintain financial covenants, including maintaining a leverage ratio of no greater than 3.00 to 1.00 and maintaining a fixed charge coverage ratio of not less than 1.15 to 1.00. As of September 30, 2022 the Company was in compliance with all restricted and financial covenants. The leverage ratio also determines pricing under the Credit Agreement. At the Borrower’s option, borrowings under the revolving credit facility accrue interest at a rate equal to either LIBOR or a specified base rate plus an applicable margin. The applicable margin is linked to the leverage ratio. The margins range from 2.00% to 2.50% per annum for LIBOR loans and 1.00% to 1.50% per annum for base rate loans. The revolving credit facility is subject to a commitment fee payable on the unused revolving credit facility commitments ranging from 0.25% to 0.35%, depending on the Borrower’s leverage ratio. As of September 30, 2022 the Company’s unused commitment rate was 0.25%. The Borrower is also required to pay certain fees to the administrative agent and letter of credit issuers under the revolving credit facility. During the term of the revolving credit facility, the Borrower may borrow, repay and re-borrow amounts available under the revolving credit facility, subject to voluntary reductions of the swing line, letter of credit and revolving credit commitments. Convertible Senior Notes On September 14, 2021, the Company issued an aggregate of $750 million in principal amount of its 1.25% Convertible Senior Notes due 2026 (the “Notes”). The Notes were issued pursuant to, and are governed by, an indenture (the “Indenture”), dated as of September 14, 2021, between the Company and U.S. Bank National Association, as trustee. Pursuant to the purchase agreement between the Company and the initial purchasers of the Notes, the Company granted the initial purchasers an option to purchase, for settlement within a period of 13 days from, and including, the date the Notes were first issued, up to an additional $100 million principal amount of Notes. The Notes issued on September 14, 2021 include the $100 million principal amount of Notes issued pursuant to the full exercise by the initial purchasers of such option. The Notes are the Company’s senior, unsecured obligations and are (i) equal in right of payment with the Company’s existing and future senior, unsecured indebtedness; (ii) senior in right of payment to the Company’s existing and future indebtedness that is expressly subordinated to the Notes; (iii) effectively subordinated to the Company’s existing and future secured indebtedness, to the extent of the value of the collateral securing that indebtedness; and (iv) structurally subordinated to all existing and future indebtedness and other liabilities, including trade payables, and (to the extent the Company is not a holder thereof) preferred equity, if any, of the Company’s subsidiaries. The Notes accrue interest at a rate of 1.25% per annum, payable semi-annually in arrears on April 1 and October 1 of each year, beginning on April 1, 2022. The Notes mature on October 1, 2026, unless earlier repurchased, redeemed or converted. Before April 1, 2026, noteholders have the right to convert their Notes only upon the occurrence of certain events. From and after April 1, 2026, noteholders may convert their Notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date. The Company will settle conversions by paying or delivering, as applicable, cash, shares of its common stock or a combination of cash and shares of its common stock, at the Company’s election. The initial conversion rate is 31.4859 shares of common stock per $1,000 principal amount of Notes, which represents an initial conversion price of approximately $31.76 per share of common stock. The conversion rate and conversion price will be subject to customary adjustments upon the occurrence of certain events. In addition, if certain corporate events that constitute a “Make-Whole Fundamental Change” (as defined in the Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time. The conversion price as of September 30, 2022 was $31.76 per share of common stock. The Notes are redeemable, in whole or in part (subject to certain limitations described below), at the Company’s option at any time, and from time to time, on or after October 6, 2024, and on or before the 40 th scheduled trading day immediately before the maturity date, but only if certain liquidity conditions are satisfied and the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price on (i) each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the trading day immediately before the date the Company sends the related redemption notice; and (ii) the trading day immediately before the date the Company sends such notice. However, the Company may not redeem less than all of the outstanding notes unless at least $100.0 million aggregate principal amount of notes are outstanding and not called for redemption as of the time the Company sends the related redemption notice. The redemption price will be a cash amount equal to the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. In addition, calling any Note for redemption will constitute a Make-Whole Fundamental Change with respect to that Note, in which case the conversion rate applicable to the conversion of that Note will be increased in certain circumstances if it is converted after it is called for redemption. If certain corporate events that constitute a “Fundamental Change” (as defined in the Indenture) occur, then, subject to a limited exception for certain cash mergers, noteholders may require the Company to repurchase their Notes at a cash repurchase price equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. The definition of Fundamental Change includes certain business combination transactions involving the Company and certain de-listing events with respect to the Company’s common stock. The Notes have customary provisions relating to the occurrence of “Events of Default” (as defined in the Indenture), which include the following: (i) certain payment defaults on the Notes (which, in the case of a default in the payment of interest on the Notes, will be subject to a 30-day cure period); (ii) the Company’s failure to send certain notices under the Indenture within specified periods of time; (iii) the Company’s failure to convert a Note upon the exercise of the conversion right with respect to such Note, subject to a three business-day cure period; (iv) the Company’s failure to comply with certain covenants in the Indenture relating to the Company’s ability to consolidate with or merge with or into, or sell, lease or otherwise transfer, in one transaction or a series of transactions, all or substantially all of the assets of the Company and its subsidiaries, taken as a whole, to another person; (v) a default by the Company in its other obligations or agreements under the Indenture or the Notes if such default is not cured or waived within 60 days after notice is given in accordance with the Indenture; (vi) certain defaults by the Company or any of its subsidiaries with respect to indebtedness for money borrowed of at least $45,000,000; (vii) the rendering of certain judgments against the Company or any of its significant subsidiaries for the payment of at least $45,000,000, where such judgments are not discharged or stayed within 60 days after the date on which the right to appeal has expired or on which all rights to appeal have been extinguished and (viii) certain events of bankruptcy, insolvency and reorganization involving the Company or any of its significant subsidiaries. If an Event of Default involving bankruptcy, insolvency or reorganization events with respect to the Company (and not solely with respect to a significant subsidiary of the Company) occurs, then the principal amount of, and all accrued and unpaid interest on, all of the Notes then outstanding will immediately become due and payable without any further action or notice by any person. If any other Event of Default occurs and is continuing, then, the Trustee, by notice to the Company, or noteholders of at least 25% of the aggregate principal amount of Notes then outstanding, by notice to the Company and the Trustee, may declare the principal amount of, and all accrued and unpaid interest on, all of the Notes then outstanding to become due and payable immediately. However, notwithstanding the foregoing, the Company may elect, at its option, that the sole remedy for an Event of Default relating to certain failures by the Company to comply with certain reporting covenants in the Indenture consists exclusively of the right of the noteholders to receive special interest on the Notes for up to 180 days at a specified rate per annum not exceeding 1.00% on the principal amount of the Notes. The Notes were issued to the initial purchasers of such Notes in transactions not involving any public offering in reliance upon Section 4(a)(2) of the Securities Act. The Notes were resold by the initial purchasers to persons whom the initial purchasers reasonably believe are “qualified institutional buyers,” as defined in, and in accordance with, Rule 144A under the Securities Act. The total amount of debt issuance costs of $21.3 million was recorded as a reduction to “Convertible senior notes, net” in the Company’s Condensed Consolidated Balance Sheets and are being amortized as interest expense over the term of the Notes using the effective interest method. During the three and nine months ended September 30, 2022, the Company recognized $1.1 million and $3.2 million in interest expense related to the amortization of the debt issuance costs related to the Notes, respectively. During the three and nine months ended September 30, 2021, the Company recognized $0.2 million in interest expense related to the amortization of the debt issuance costs related to the Notes. The following is a summary of the Company’s Notes as of September 30, 2022: Fair Value (in thousands) Principal Amount Unamortized Issuance Costs Net Carrying Amount Level 1.25% Convertible Notes due 2026 $ 750,000 $ 16,914 $ 733,086 $ 603,750 Level 2 The Notes are carried at face value less the unamortized debt issuance costs on the Company’s Condensed Consolidated Balance Sheets. As of September 30, 2022, the estimated fair value of the Notes was approximately $604 million. The estimated fair value of the Notes was determined based on the actual bid price of the Notes on September 30, 2022. As of September 30, 2022, the remaining life of the Notes is approximately 4.0 years. Capped Call Transactions On September 9, 2021, in connection with the pricing of the offering of Notes, the Company entered into privately negotiated capped call transactions (the “Base Capped Call Transactions”) with Bank of Montreal, Credit Suisse Capital LLC, Deutsche Bank AG, London Branch, Goldman Sachs & Co. LLC, JPMorgan Chase Bank, National Association, Mizuho Markets Americas LLC and Wells Fargo Bank, National Association (the “Option Counterparties”). In addition, on September 10, 2021, in connection with the initial purchasers’ exercise of their option to purchase additional Notes, the Company entered into additional capped call transactions (the “Additional Capped Call Transactions,” and, together with the Base Capped Call Transactions, the “Capped Call Transactions”) with each of the Option Counterparties. The Capped Call Transactions cover, subject to customary anti-dilution adjustments, the aggregate number of shares of the Company’s common stock that initially underlie the Notes, and are expected generally to reduce potential dilution to the Company’s common stock upon any conversion of Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be, with such reduction and/or offset subject to a cap, based on the cap price of the Capped Call Transactions. The cap price of the Capped Call Transactions is initially $47.94, which represents a premium of 100% over the last reported sale price of the Company’s common stock on September 9, 2021. The cost of the Capped Call Transactions was approximately $90.2 million. The Capped Call Transactions are separate transactions, each between the Company and the applicable Option Counterparty, and are not part of the terms of the Notes and do not affect any holder’s rights under the Notes or the Indenture. Holders of the Notes will not have any rights with respect to the Capped Call Transactions. Business Combination In connection with the Closing of the Business Combination, all of Hydrafacial’s existing debt under its credit facilities were repaid and its credit facilities were extinguished. T he related write-off of the deferred financing costs totaled $2.3 million and prepayment penalties totaled $2.0 million in 2021. Both are included in the Other expense (income), net on the Company’s Consolidated Statements of Comprehensive Income (Loss). Defer red financing costs expense for the nine months ended September 30, 2021 amounted to $0.5 million for the existing debt prior to the Closing of the Business Combination while issuance costs for the Notes amounted to $0.2 million. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The income tax (benefit) expense for the three months and nine months ended September 30, 2022 is $(0.8) million and $1.9 million, respectively The income tax benefit for the three and nine months ended September 30, 2021 is $1.1 million and $3.3 million, respectively. The effective tax rate for the three and nine months ended September 30, 2022 is 119.12% and (4.41%), compared to the federal statutory rate of 21.0%, is primarily due to the exclusion from taxable income of book income from the revaluation of warrant liabilities and adjustments for various non-deductible expenses for officer’s compensation and meals and entertainment. The effective tax rate for the three and nine months ended September 30, 2021 is 0.53% and 0.92%, which is lower than the federal statutory rate of 21.0% primarily due to the increase in valuation allowance and non-deductible expense related to stock-based compensation, transaction costs and meals and entertainment. The Company has established a valuation allowance in the U.S. and Singapore against a portion of its deferred income tax assets because it is more likely than not that certain deferred tax assets will not be realized. In determining whether deferred tax assets are realizable, the Company considered numerous factors including historical profitability, the amount of future taxable income and the existence of taxable temporary differences that can be used to realize deferred tax assets. Additionally, the Company applies ASC 740, the accounting standard governing uncertainty in income taxes that prescribes rules for recognition, measurement and classification in the financial statements of tax positions taken or expected to be taken in a tax return. The Company has gross unrecognized tax benefits of $0.1 million and $0.2 million as of September 30, 2022 and December 31, 2021, respectively. On March 11, 2021 the United States enacted the American Rescue Plan Act of 2021 (“American Rescue Plan”). The American Rescue Plan includes various income and payroll tax measures. The Company does not expect a material impact of the American Rescue Plan on the Company’s Condensed Consolidated Financial Statements and related disclosures. The Inflation Reduction Act, signed into law on August 16, 2022, provides tax incentives for certain industries and imposes a 15% minimum tax on the book income of certain large corporations and a 1% excise tax on stock buybacks. The Company may be subject to the new excise tax on certain stock buybacks that occur after December 31, 2022. The Company does not anticipate a material impact from the Inflation Reduction Act on the Company's condensed consolidated financial statements. |
Equity-Based Compensation
Equity-Based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Equity-Based Compensation | Equity-Based Compensation Compensation expense attributable to net stock-based compensation was as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Cost of sales 191 70 624 222 Selling and marketing 2,498 1,064 7,331 1,413 Research and development 215 70 602 103 General and administrative 4,545 3,878 12,319 6,886 Stock-based compensation expense $ 7,449 $ 5,082 $ 20,876 $ 8,624 Restricted Stock Units (“RSUs”) and Performance-based restricted stock units (“PSUs”) The following table summarizes the Company’s equity award activity for the nine months ended September 30, 2022: Weighted Average Grant Date Fair Value RSUs PSUs RSUs PSUs Outstanding - January 1, 2022 380,775 975,000 $ 25.88 $ 11.39 Granted 2,724,851 1,629,395 13.67 9.10 Vested (187,727) — 20.60 — Forfeited (388,691) (209,738) 15.31 14.30 Outstanding - September 30, 2022 2,529,208 2,394,657 14.74 9.58 The following table summarizes the Company’s stock option activity for the nine months ended September 30, 2022: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding - January 1, 2022 6,785,020 $ 15.64 Granted 10,500 22.68 Unvested Forfeited (951,500) 18.43 Vested Expired (39,050) 14.53 Outstanding - September 30, 2022 5,804,970 $ 15.20 8.67 $ — Options Exercisable 1,293,800 $ 13.79 8.58 $ — Options vested and expected to vest - September 30, 2022 5,804,970 $ 15.20 8.67 $ — |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and ContingenciesFrom time to time the Company may be involved in claims, legal actions and governmental proceedings that arise from its business operations. As of September 30, 2022, the Company was not a party to any legal proceedings or threatened legal proceedings, the adverse outcome of which, individually or in the aggregate, that it believes would have a material adverse effect on its business, financial condition or results of operations. |
Concentrations
Concentrations | 9 Months Ended |
Sep. 30, 2022 | |
Risks and Uncertainties [Abstract] | |
Concentrations | Concentrations As of September 30, 2022, the Company had no customers that accounted for 10% or more of the Accounts receivable balance. As of December 31, 2021, the Company had no customers that accounted for 10% or more of the Accounts receivable balance. |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | Related-Party Transactions Registration Rights Agreement In connection with the consummation of the Business Combination, on May 4, 2021, the Company entered into that certain Amended and Restated Registration Rights Agreement (the “Registration Rights Agreement”) with BLS Investor Group LLC and the Hydrafacial Stockholders. Pursuant to the terms of the Registration Rights Agreement, (i) any outstanding share of Class A Common Stock or any other equity security (including the Private Placement Warrants and including shares of Class A Common Stock issued or issuable upon the exercise of any other equity security) of the Company held by the Sponsor or the Hydrafacial Stockholders (together, the “Restricted Stockholders”) as of the date of the Registration Rights Agreement or thereafter acquired by a Restricted Stockholder (including the shares of Class A Common Stock issued upon conversion of the 11,500,000 Founder Shares that were owned by the Sponsor and converted to shares of Class A Common Stock prior in connection with the Business Combination and upon exercise of any Private Placement Warrants) and shares of Class A Common Stock issued as earn-out shares to the Hydrafacial Stockholders and (ii) any other equity security of the Company issued or issuable with respect to any such share of common stock by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization or otherwise will be entitled to registration rights. The Registration Rights Agreement provides that the Company will, within 60 days after the consummation of the Business Combination, file with the SEC a shelf registration statement registering the resale of the shares of common stock held by the Restricted Stockholders and will use its reasonable best efforts to have such registration statement declared effective as soon as practicable after the filing thereof, but in no event later than 60 days following the filing deadline. The Company filed such registration statement on July 19, 2021 and it was declared effective by the SEC on July 26, 2021. The Hydrafacial Stockholders are entitled to make up to an aggregate of two demands for registration, excluding short form demands, that the Company register shares of common stock held by these parties. In addition, the Restricted Stockholders have certain “piggy-back” registration rights. The Company will bear the expenses incurred in connection with the filing of any registration statements filed pursuant to the terms of the Registration Rights Agreement. The Company and the Restricted Stockholders agree in the Registration Rights Agreement to provide customary indemnification in connection with any offerings of common stock effected pursuant to the terms of the Registration Rights Agreement. Pursuant to the Registration Rights Agreement, the Sponsor agreed to restrictions on the transfer of their securities issued in the Company’s initial public offering, which (i) in the case of the Founder Shares is one year after the completion of the Business Combination unless (A) the closing price of the common stock equals or exceeds $12.00 per share for 20 days out of any 30-trading-day period commencing at least 150 days following the Closing of the Business Combination or (B) the Company completes a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of common stock for cash, securities or other property, and (ii) in the case of the Private Placement Warrants and the respective Class A Common Stock underlying the Private Placement Warrants is 30 days after the completion of the Business Combination. The Sponsor and its permitted transferees will also be required, subject to the terms and conditions in the Registration Rights Agreement, not to transfer their Private Investor Rights Agreement In connection with the consummation of the Business Combination, on May 4, 2021, the Company and LCP Edge Holdco, LLC entered into that certain Investor Rights Agreement (the “Investor Rights Agreement”). Pursuant to the Investor Rights Agreement, LCP has the right to designate a number of directors for appointment or election to the Company’s board of directors as follows: (i) one director for so long as LCP holds at least 10% of the outstanding Class A Common Stock, (ii) two directors for so long as LCP holds at least 15% of the outstanding Class A Common Stock, and (iii) three directors for so long as LCP holds at least 40% of the outstanding Class A Common Stock. Pursuant to the Investor Rights Agreement, for so long as LCP holds at least 10% of the outstanding Class A Common Stock, LCP will be entitled to have at least one of its designees represented on the compensation committee and nominating committee and corporate governance committee of the Company’s board of directors. Amended and Restated Management Services Agreement Hydrafacial entered into a Management Services Agreement, dated December 1, 2016 with Linden Capital Partners III LP (“Linden Capital Partners III”) and DW Management Services, L.L.C. (“DW Management Services”) pursuant to which the parties receive quarterly monitoring fees of the greater of (a) $125,000 and (b) 1.25% of Last Twelve Months EBITDA multiplied by the quotient of (x) the aggregate capital invested by the investors of DW Healthcare Partners IV (B), L.P. (“DWHP Investors”) into LCP and/or its subsidiaries as of such date, divided by (y) the sum of (i) the aggregate capital invested by the DWHP Investors into LCP and/or its subsidiaries, plus (ii) the aggregate capital invested by Linden Capital Partners III into LCP and/or its subsidiaries as of the date of payment. In addition, the management services agreement provides for other fees in relation to services that may be provided in connection with equity and/or debt financing, acquisition of any other business, company, product line or enterprise, or divestiture of any division, business, and product or material assets. The fees vary between 1% and 2% of the related transaction amount. Linden Capital Partners III also received a transaction fee upon the consummation of the Business Combination. In connection with the consummation of the Business Combination, on May 4, 2021, the Company, its subsidiary, Edge Systems LLC, and Linden Capital III LLC, the general partner of Linden Manager III LP (the “Linden Manager”) entered into an Amended and Restated Management Services Agreement (the “Linden Management Services Agreement”) pursuant to which the Linden Manager may continue to provide advisory services at the request of the Company related to mergers and acquisitions for one year following the Business Combination. As consideration for such services, the Company will pay a fee, equal to 1% of enterprise value of the target acquired, to the Linden Manager upon the consummation of any such transaction (the “1% Fee”). The Company has also agreed to reimburse Linden Manager for certain expenses in connection with such advisory services. However, pursuant to the Linden Management Services Agreement, the Company’s obligation to pay the 1% Fee expired twelve months after the consummation of the Business Combination on May 4, 2022. Hydrafacial recorded approximately $0.2 million of charges related to management services fees for th e nine months ended September 30, 2021. There were no management fees during the three and nine months ended September 30, 2022. These amounts are included in General and administrative expenses on the Company’s Consolidated Statements of Comprehensive Income (Loss). In relation to the consummation of the Business Combination, $21.0 million in transaction fees was paid to the Former Parent. These amounts are included in General and administrative expenses on the Company’s Consolidated Statements of Comprehensive Income (Loss). Miami Beach Office The Company maintains an office in Miami Beach, Florida, whereby the Company, on a monthly basis, reimburses an entity owned by the Company’s Executive Chairman that makes such office available to the Company for its employees and affiliates. Expense for this property was not material for the nine months ended September 30, 2022. No such expenses existed for the nine months ended September 30, 2021 . |
Stockholders_ Equity
Stockholders’ Equity | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Stockholders’ Equity | Stockholders’ Equity Common Stock The Company is authorized to issue 320,000,000 shares of Class A Common Stock, par value of $0.0001 per share. Holders of Class A Common Stock are entitled to one vote for each share. As of September 30, 2022 and December 31, 2021, there were 143,201,041 and 150,598,047, respectively, of Class A Common Stock issued and outstanding. The Class A Common Stock is entitled t o one vote pe r share and all shares are outstanding. The Company has not declared or paid any dividends with respect to its Class A Common Stock . In connection with the Business Combination on May 4, 2021, the Company issued 35,000,000 shares of Class A Common Stock to certain qualified institutional buyers and accredited investors that agreed to purchase such shares in connection with the Business Combination for aggregate consideration of $350 million. The Company also issued 35,501,743 shares of Class A Common Stock as partial compensation to the Hydrafacial Stockholders for the Business Combination. Common Stock Repurchases On September 26, 2022, the Company’s board of directors approved a common stock repurchase program pursuant to which the Company may repurchase up to $200 million of its outstanding shares of Class A Common Stock. Under the share repurchase program, repurchases can be made from time to time using a variety of methods, which may include open market purchases, privately negotiated transactions, or accelerated share repurchase programs. On September 27, 2022, the Company entered into an accelerated share repurchase agreement with a financial institution to repurchase a total of $100 million of Class A Common Stock. The Company made a payment of $100 million and in turn, received an initial delivery of approximately 7.7 million shares, which represented 80% of the payment amount divided by the Company’s closing stock price on September 26, 2022 and were immediately retired. The total number of shares that will be received under the accelerated share repurchase agreement will be based upon the average daily volume weighted average price of our Class A Common Stock during the repurchase period, less an agreed upon discount. The final settlement of the accelerated repurchase agreement may occur between November 28, 2022 and February 28, 2023. The accelerated share repurchase agreement is accounted for as a repurchase and retirement of shares and as an equity forward contract indexed to the Company’s Class A Common Stock. The equity forward contract is classified as an equity instrument under ASC 815 - 40, Contracts in Entity's Own Equity ("ASC 815 - 40"). The par value of the initial shares received is recorded as a reduction to the Company’s Class A Common Stock and the excess of par value is recognized as a reduction to additional paid in capital. The equity forward stock purchase contract is classified as an equity instrument and is recognized as a reduction to additional paid in capital. The initial delivery of approximately 7.7 million shares reduced the number of Class A Common Stock outstanding on the transaction date and, as a result, reduced the weighted average number of Class A Common Stock outstanding used to calculate basic income per share and diluted income per share for the three and nine month periods ended September 30, 2022. The Company performed analysis of the average of the daily volume-weighted average price of our Class A Common Stock since the transaction date and has determined, as of September 30, 2022, that the final settlement of shares of Class A Common Stock under the accelerated share repurchase agreement is anti-dilutive and therefore excluded from the calculation of diluted earnings per share. Preferred Stock The Company is authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. At September 30, 2022 and December 31, 2021 , there were no shares of preferred stock issued or outstanding. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment ReportingThe Company manages its business on the basis of one operating segment and one reportable segment. As a result, the chief operating decision maker, who is the Chief Executive Officer, decides how to allocate resources and assess performance, reviews financial information presented on a consolidated basis for purposes of making operating decisions, allocates resources and evaluates financial performance. Net sales by geographic region were as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Americas $ 58,375 $ 45,046 $ 178,335 $ 118,986 Asia-Pacific 15,110 10,490 38,397 31,721 Europe, the Middle East and Africa 15,307 12,611 51,011 31,490 Total net sales $ 88,792 $ 68,147 $ 267,743 $ 182,197 As of September 30, 2022 and December 31, 2021 substantially all of the Company’s property and equipment were held in the United States. |
Net Income (Loss) Attributable
Net Income (Loss) Attributable to Common Shareholders | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Attributable to Common Shareholders | Net Income (Loss) Attributable to Common Shareholders The following table sets forth the calculation of both basic and diluted net income (loss) per share as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except share and per share amounts) 2022 2021 2022 2021 Net income (loss) available to common shareholders - basic $ 131 $ (215,145) $ 40,569 $ (357,797) Plus: Income (loss) on Private placement warrants (4,284) — (71,521) — Net income (loss) available to common shareholders - diluted $ (4,153) $ (215,145) $ (30,952) $ (357,797) Weighted average common shares outstanding - basic 150,788,695 132,306,346 150,706,795 87,219,681 Effect of dilutive shares: Private placement warrants 629,015 — 1,311,451 — Weighted average common shares outstanding - diluted 151,417,710 132,306,346 152,018,246 87,219,681 Basic net income (loss) per share: $ 0.00 $ (1.63) $ 0.27 $ (4.10) Diluted net income (loss) per share $ (0.03) $ (1.63) $ (0.20) $ (4.10) The following shares have been excluded from the calculation of the weighted average diluted shares outstanding as the effect would have been anti-dilutive or requisite performance conditions were not met: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Convertible Notes 23,614,425 11,807,213 23,614,425 7,871,475 RSUs 2,529,208 200,247 2,529,208 133,498 PSUs 2,394,657 975,000 2,394,657 650,000 Stock Options 5,804,970 8,521,900 5,804,970 5,557,267 Public and Private Warrants — 24,666,666 — 16,444,444 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsOther than as disclosed elsewhere, no subsequent events have occurred that would require recognition in the condensed consolidated financial statements or disclosure in the accompanying notes. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. These statements reflect all normal and recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of the Company for the interim periods presented. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in, or presented as exhibits to, the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. |
New Accounting Pronouncements Not Yet Adopted | New Accounting Pronouncements Not Yet Adopted In October 2021, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) ASU 2021-08, Business Combinations (Topic 805), which primarily relates to the accounting for contract assets and contract liabilities from contracts with customers in a business combination. The standard will be effective for annual reporting periods beginning after December 31, 2022, including interim reporting periods within those periods, with early adoption permitted. We are currently evaluating the impact of adopting this new accounting guidance on our consolidated financial statements. |
Business Combinations and Ass_2
Business Combinations and Asset Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of reverse recapitalization | The following table reconciles the elements of the Business Combination to the Company’s Consolidated Statements of Cash Flows and the Consolidated Statements of Stockholders’ Equity (Deficit) for the year ended December 31, 2021: (in thousands) Recapitalization Cash in trust, net of redemptions $ 433,382 Cash — PIPE 350,000 Less: Cash paid out to Former Parent (367,870) Less: Transaction costs and advisory fees (56,976) Less: Cash paid out from net working capital adjustment related to acquisitions (902) Net Cash Received from Business Combination $ 357,634 The number of shares of Class A Common Stock issued following the consummation of the Business Combination: Number of Shares Class A common stock outstanding prior to Business Combination 46,000,000 Less: Redemption of Vesper Class A Common Stock (2,672,690) Class A common stock of Vesper 43,327,310 Founder shares (Vesper Class B Common Stock) 11,500,000 PIPE Shares 35,000,000 Business Combination and PIPE shares 89,827,310 Legacy Hydrafacial shares (1) 35,501,743 Working capital adjustment Class A Common Stock issued 70,860 Total Shares of Class A Common Stock after Business Combination 125,399,913 _______________ (1) The number of Legacy Hydrafacial shares was determined from the 54,358 shares of Hydrafacial common stock outstanding immediately prior to the closing of the Business Combination multiplied by the Exchange Ratio of 653.109. |
Summary of assets acquired at fair value | The following table summarizes the consideration and fair values assigned to the assets acquired and liabilities assumed at the dates of acquisition for the Wigmore, Ecomedic and Sidermica acquisitions and summarizes the HTL acquisition after measurement period adjustments. (in thousands) HTL Wigmore (2) Ecomedic (3) Sidermica (4) Consideration paid: Cash, net of cash acquired $ 4,920 $ 2,540 $ 11,338 $ 6,861 Class A Common Stock issued (1) 1,557 456 6,513 815 Trade receivables due from seller 1,027 2,336 1,679 1,581 Notes payable to seller — — 2,153 — $ 7,504 $ 5,332 $ 21,683 $ 9,257 Identifiable assets acquired and liabilities assumed Accounts receivable $ 1,110 $ 2,079 $ 15 $ 1,657 Non-compete agreement 100 60 588 100 Customer relationships 2,696 2,276 5,487 2,700 Inventory and other assets 354 341 1,262 454 Accounts payable (45) (456) (772) — Deferred tax liabilities, net (675) (842) (2,008) — Accrued and other liabilities (802) (317) (340) — Total identifiable net assets 2,738 3,141 4,232 4,911 Goodwill $ 4,766 $ 2,191 $ 17,451 $ 4,346 ___________ (1) Class A Common Stock issued as consideration for the acquisitions was 110,726, 28,157, 401,021 and 50,195 shares for HTL, Wigmore, Ecomedic and Sidermica, respectively. (2) During the fourth quarter of 2021, adjustments were made to the Wigmore valuation pertaining to contingent consideration and intangible assets. Goodwill was adjusted due to an increase of $0.3 million in contingent consideration and a decrease of $1.0 million in intangible assets. Contingent consideration payments for the Wigmore acquisition were paid during the three months ended March 31, 2022. (3) During the first quarter of 2022, adjustments were made to the Ecomedic valuation pertaining to acquisition date tax liability. Goodwill was adjusted due to an increase of $0.2 million to acquisition date tax liability. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | The Company’s revenue disaggregated by major product line consists of the following for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Net Sales Delivery Systems $ 49,094 $ 36,182 $ 155,524 $ 96,798 Consumables 39,698 31,965 112,219 85,399 Total net sales $ 88,792 $ 68,147 $ 267,743 $ 182,197 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Inventories consist of the following as of the periods indicated: (in thousands) September 30, 2022 December 31, 2021 Raw materials $ 26,015 $ 12,024 Finished goods 75,691 23,237 Total inventories $ 101,706 $ 35,261 |
Schedule of accrued payroll-related expenses | Accrued payroll-related expenses consist of the following as of the periods indicated: (in thousands) September 30, 2022 December 31, 2021 Accrued compensation $ 3,733 $ 15,262 Accrued payroll taxes 2,109 922 Accrued benefits 5,026 3,022 Accrued sales commissions 9,782 9,456 Total accrued payroll-related expenses $ 20,650 $ 28,662 |
Schedule of accrued expenses | Other accrued expenses consist of the following as of the periods indicated: (in thousands) September 30, 2022 December 31, 2021 Sales and VAT tax payables $ 5,116 $ 5,817 Accrued interest 4,687 2,786 Contingent consideration — 783 Note payable due seller 2,144 2,153 Royalty liabilities 1,353 1,074 Other 3,811 2,109 Total other accrued expenses $ 17,111 $ 14,722 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities measured at fair value on recurring basis | The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis at September 30, 2022, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value. As of the Business Combination date, the Private Placement Warrants were valued using the Public Warrant Price, and was considered to be a Level 2 financial instrument as of that date. As of September 30, 2022, the value of the Private Placement Warrants was determined using their redemption value because these Private Placement Warrants are subject to redemption if the reference value of the common stock, as defined, is between $10.00 and $18.00 per share. The Private Placement Warrants are classified as a Level 2 financial instrument. There were no Public Warrants outstanding as of September 30, 2022. Fair Value Measurements on a Recurring Basis (in thousands) Level 1 Level 2 Level 3 Total Assets Cash and cash equivalents: Money market funds $ 642,445 $ — $ — $ 642,445 Liabilities Warrant liability — Private Placement Warrants — 22,295 — 22,295 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Property and equipment consist of the following as of the periods indicated: (in thousands) Useful life (years) September 30, 2022 December 31, 2021 Furniture and fixtures 2-7 $ 4,640 $ 4,074 Computers and equipment 3-5 4,600 4,010 Machinery and equipment 2-5 5,796 3,669 Autos and trucks 5 1,220 1,163 Tooling 5 594 1,389 Leasehold improvements Shorter of remaining lease 10,127 5,086 Total property and equipment 26,977 19,391 Less: accumulated depreciation and amortization (11,221) (8,561) Construction in progress 2,343 5,353 Property and equipment, net $ 18,099 $ 16,183 During the three and nine months ended September 30, 2022, the Company recorded a loss on the disposal of property and equipment, net of $1.8 million. The loss on disposal of property and equipment, net was recorded in the condensed consolidated statements of comprehensive income (loss) primarily in general and administrative expense. Depreciation expense was as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Cost of sales $ 588 $ 339 $ 1,593 $ 965 General and administrative 927 689 2,463 1,481 Selling and marketing 486 — 1,213 — Total depreciation expense $ 2,001 $ 1,028 $ 5,269 $ 2,446 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | The gross carrying amount and accumulated amortization of the Company’s intangible assets, net, as of September 30, 2022 were as follows: (in thousands) Gross Accumulated Net Carrying Estimated Trademarks $ 10,839 $ (3,950) $ 6,889 15 Non-compete agreement 758 (707) 51 3 Customer relationships 17,137 (6,132) 11,005 5-10 Developed technology 73,188 (51,825) 21,363 3-8 Patents 2,187 (385) 1,802 3-19 Capitalized software 6,706 (1,191) 5,515 3-5 Total intangible assets $ 110,815 $ (64,190) $ 46,625 During the three and nine months ended September 30, 2022, the Company recorded a loss on the disposal of intangible assets of $2.9 million. The loss on disposal of intangible assets was recorded in the condensed consolidated statements of comprehensive income (loss) primarily in general and administrative expense. The gross carrying amount and accumulated amortization of the Company’s intangible assets, net, as of December 31, 2021 were as follows: (in thousands) Gross Accumulated Net Carrying Estimated Trademarks $ 10,048 $ (3,442) $ 6,606 15 Non-compete agreement 809 (139) 670 3 Customer relationships 18,625 (4,391) 14,234 5-10 Developed technology 70,900 (45,051) 25,849 8 Patents 2,050 (295) 1,755 3-19 Capitalized software 9,867 (2,971) 6,896 3-5 Total intangible assets $ 112,299 $ (56,289) $ 56,010 |
Schedule of intangible assets amortization expense | Amortization expense was as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Cost of sales $ 2,245 $ 2,233 $ 6,864 $ 6,697 General and administrative 858 500 2,356 1,464 Selling and marketing 589 770 1,843 1,193 Total amortization expense $ 3,692 $ 3,503 $ 11,063 $ 9,354 |
Schedule of goodwill | The changes in the carrying value of goodwill are as follows: Nine Months Ended September 30, (in thousands) 2022 2021 Beginning balance $ 123,694 $ 98,531 Measurement period adjustments 2,154 25,304 Foreign currency translation impact (3,100) (970) Ending balance $ 122,748 $ 122,865 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | The following is a summary of the Company’s Notes as of September 30, 2022: Fair Value (in thousands) Principal Amount Unamortized Issuance Costs Net Carrying Amount Level 1.25% Convertible Notes due 2026 $ 750,000 $ 16,914 $ 733,086 $ 603,750 Level 2 |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of share based compensation | Compensation expense attributable to net stock-based compensation was as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Cost of sales 191 70 624 222 Selling and marketing 2,498 1,064 7,331 1,413 Research and development 215 70 602 103 General and administrative 4,545 3,878 12,319 6,886 Stock-based compensation expense $ 7,449 $ 5,082 $ 20,876 $ 8,624 |
Schedule of unvested share activity | The following table summarizes the Company’s equity award activity for the nine months ended September 30, 2022: Weighted Average Grant Date Fair Value RSUs PSUs RSUs PSUs Outstanding - January 1, 2022 380,775 975,000 $ 25.88 $ 11.39 Granted 2,724,851 1,629,395 13.67 9.10 Vested (187,727) — 20.60 — Forfeited (388,691) (209,738) 15.31 14.30 Outstanding - September 30, 2022 2,529,208 2,394,657 14.74 9.58 |
Schedule of stock option activity | The following table summarizes the Company’s stock option activity for the nine months ended September 30, 2022: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Outstanding - January 1, 2022 6,785,020 $ 15.64 Granted 10,500 22.68 Unvested Forfeited (951,500) 18.43 Vested Expired (39,050) 14.53 Outstanding - September 30, 2022 5,804,970 $ 15.20 8.67 $ — Options Exercisable 1,293,800 $ 13.79 8.58 $ — Options vested and expected to vest - September 30, 2022 5,804,970 $ 15.20 8.67 $ — |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Summary of net sales by geographic region | Net sales by geographic region were as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands) 2022 2021 2022 2021 Americas $ 58,375 $ 45,046 $ 178,335 $ 118,986 Asia-Pacific 15,110 10,490 38,397 31,721 Europe, the Middle East and Africa 15,307 12,611 51,011 31,490 Total net sales $ 88,792 $ 68,147 $ 267,743 $ 182,197 |
Net Income (Loss) Attributabl_2
Net Income (Loss) Attributable to Common Shareholders (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted earnings per share | The following table sets forth the calculation of both basic and diluted net income (loss) per share as follows for the periods indicated: Three Months Ended September 30, Nine Months Ended September 30, (in thousands, except share and per share amounts) 2022 2021 2022 2021 Net income (loss) available to common shareholders - basic $ 131 $ (215,145) $ 40,569 $ (357,797) Plus: Income (loss) on Private placement warrants (4,284) — (71,521) — Net income (loss) available to common shareholders - diluted $ (4,153) $ (215,145) $ (30,952) $ (357,797) Weighted average common shares outstanding - basic 150,788,695 132,306,346 150,706,795 87,219,681 Effect of dilutive shares: Private placement warrants 629,015 — 1,311,451 — Weighted average common shares outstanding - diluted 151,417,710 132,306,346 152,018,246 87,219,681 Basic net income (loss) per share: $ 0.00 $ (1.63) $ 0.27 $ (4.10) Diluted net income (loss) per share $ (0.03) $ (1.63) $ (0.20) $ (4.10) |
Schedule of antidilutive securities excluded from earnings per share computation | The following shares have been excluded from the calculation of the weighted average diluted shares outstanding as the effect would have been anti-dilutive or requisite performance conditions were not met: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Convertible Notes 23,614,425 11,807,213 23,614,425 7,871,475 RSUs 2,529,208 200,247 2,529,208 133,498 PSUs 2,394,657 975,000 2,394,657 650,000 Stock Options 5,804,970 8,521,900 5,804,970 5,557,267 Public and Private Warrants — 24,666,666 — 16,444,444 |
Description of Business (Detail
Description of Business (Details) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 | May 04, 2021 | May 03, 2021 |
Business Acquisition [Line Items] | ||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | |
HydraFacial | ||||
Business Acquisition [Line Items] | ||||
Reverse recapitalization, ownership percentage | 100% | |||
Hydrate Merger Sub I, Inc. | ||||
Business Acquisition [Line Items] | ||||
Reverse recapitalization, ownership percentage | 100% | |||
Hydrate Merger Sub II, LLC | ||||
Business Acquisition [Line Items] | ||||
Reverse recapitalization, ownership percentage | 100% |
Business Combinations and Ass_3
Business Combinations and Asset Acquisitions- Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Apr. 12, 2022 USD ($) shares | May 04, 2021 USD ($) $ / shares shares | May 03, 2021 USD ($) shares | Jul. 02, 2021 USD ($) business | Sep. 30, 2022 USD ($) shares | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) shares | |
Business Acquisition [Line Items] | |||||||
Consideration received on transaction | $ 350,000 | ||||||
Common stock, conversion ratio | 1 | ||||||
Common stock, shares issued (in shares) | shares | 143,201,041 | 150,598,047 | |||||
Common stock, shares outstanding (in shares) | shares | 125,399,913 | 54,358 | 143,201,041 | 150,598,047 | |||
Gross consideration received | $ 783,000 | ||||||
Cash acquired from trust account | 433,000 | $ 433,382 | |||||
Cash consideration paid to stockholders | 368,000 | 367,870 | |||||
Payment of transaction costs | $ 57,000 | 56,976 | |||||
Legacy HydraFacial shares (in shares) | shares | 35,501,743 | ||||||
Cash paid out for WC Adjustment | $ 900 | $ 902 | |||||
Working capital adjustment Class A Common Stock issued (in shares) | shares | 70,860 | ||||||
Cash paid for business acquisitions, net of cash acquired | $ 0 | $ 22,896 | |||||
Cash paid for asset acquisition | $ 1,475 | $ 0 | |||||
Mxt | |||||||
Business Acquisition [Line Items] | |||||||
Weighted average amortization period | 3 years | ||||||
Cash paid for asset acquisition | $ 1,500 | ||||||
Asset acquisition, equity consideration | $ 500 | ||||||
Asset acquisition, equity consideration (in shares) | shares | 28,733 | ||||||
Asset acquisition, contingent consideration (up to) | $ 30,000 | ||||||
Intangible assets acquired | 1,900 | ||||||
Inventory acquired | $ 100 | ||||||
Class A common stock | |||||||
Business Acquisition [Line Items] | |||||||
Consideration received on transaction (in shares) | shares | 35,000,000 | ||||||
Stock purchase price (in dollars per share) | $ / shares | $ 10 | ||||||
Consideration received on transaction | $ 350,000 | ||||||
Stock redeemed (in shares) | shares | 2,672,690 | ||||||
Stock redeemed, price (in dollars per share) | $ / shares | $ 10 | ||||||
Shares redeemed | $ 26,700 | ||||||
Common stock, shares issued (in shares) | shares | 125,329,053 | ||||||
Common stock, shares outstanding (in shares) | shares | 125,329,053 | ||||||
Legacy HydraFacial shares (in shares) | shares | 35,501,743 | ||||||
Class B Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Consideration received on transaction (in shares) | shares | 11,500,000 | ||||||
Consideration received on transaction | $ 25 | ||||||
HTL, Wigmore, Ecomedic and Sidermica acquisitions | |||||||
Business Acquisition [Line Items] | |||||||
Number of acquisitions | business | 4 | ||||||
Cash paid for business acquisitions, net of cash acquired | $ 23,700 | ||||||
HTL, Wigmore, Ecomedic and Sidermica acquisitions | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Weighted average amortization period | 5 years | ||||||
HTL, Wigmore, Ecomedic and Sidermica acquisitions | Non-compete agreement | |||||||
Business Acquisition [Line Items] | |||||||
Weighted average amortization period | 3 years |
Business Combinations and Ass_4
Business Combinations and Asset Acquisitions - Schedule of reverse recapitalization consideration (Details) - USD ($) $ in Thousands | 12 Months Ended | |
May 04, 2021 | Dec. 31, 2021 | |
Business Combination and Asset Acquisition [Abstract] | ||
Cash in trust, net of redemptions | $ 433,000 | $ 433,382 |
Cash — PIPE | 350,000 | |
Less: Cash paid out to Former Parent | (368,000) | (367,870) |
Less: Transaction costs and advisory fees | (57,000) | (56,976) |
Less: Cash paid out from net working capital adjustment related to acquisitions | $ (900) | (902) |
Net Cash Received from Business Combination | $ 357,634 |
Business Combinations and Ass_5
Business Combinations and Asset Acquisitions - Schedule of reverse recapitalization shares issued (Details) | May 04, 2021 shares | May 03, 2021 shares | Sep. 30, 2022 shares | Dec. 31, 2021 shares |
Reverse Recapitalization [Line Items] | ||||
Common stock, shares outstanding (in shares) | 125,399,913 | 54,358 | 143,201,041 | 150,598,047 |
PIPE Shares | 35,000,000 | |||
Business Combination and PIPE shares | 89,827,310 | |||
Legacy HydraFacial shares (in shares) | 35,501,743 | |||
Working capital adjustment Class A Common Stock issued (in shares) | 70,860 | |||
Recapitalization exchange ratio (in shares) | 653.109 | |||
Common shareholders | ||||
Reverse Recapitalization [Line Items] | ||||
Business combination shares (in shares) | 43,327,310 | |||
Vesper Founders | ||||
Reverse Recapitalization [Line Items] | ||||
Business combination shares (in shares) | 11,500,000 | |||
Vesper | ||||
Reverse Recapitalization [Line Items] | ||||
Common stock, shares outstanding (in shares) | 46,000,000 | |||
Less: Redemption of Vesper Class A common stock (in shares) | (2,672,690) |
Business Combinations and Ass_6
Business Combinations and Asset Acquisitions - Summary of assets acquired at fair value (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Jun. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2020 | |
Consideration paid: | |||||||
Cash, net of cash acquired | $ 0 | $ 22,896 | |||||
Identifiable assets acquired and liabilities assumed | |||||||
Goodwill | $ 123,694 | 122,748 | 122,865 | $ 98,531 | |||
Measurement period adjustments | $ 2,154 | $ 25,304 | |||||
HTL | |||||||
Consideration paid: | |||||||
Cash, net of cash acquired | $ 4,920 | ||||||
Class A Common Stock issued | 1,557 | ||||||
Trade receivables due from seller | 1,027 | ||||||
Notes payable to seller | 0 | ||||||
Total consideration | 7,504 | ||||||
Identifiable assets acquired and liabilities assumed | |||||||
Accounts receivable | $ 1,110 | 1,110 | |||||
Inventory and other assets | 354 | 354 | |||||
Accounts payable | (45) | (45) | |||||
Deferred tax liabilities, net | (675) | (675) | |||||
Accrued and other liabilities | (802) | (802) | |||||
Total identifiable net assets | 2,738 | 2,738 | |||||
Goodwill | 4,766 | $ 4,766 | |||||
Equity consideration (in shares) | 110,726 | ||||||
HTL | Non-compete agreement | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | 100 | $ 100 | |||||
HTL | Customer relationships | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | 2,696 | 2,696 | |||||
Wigmore | |||||||
Consideration paid: | |||||||
Cash, net of cash acquired | 2,540 | ||||||
Class A Common Stock issued | 456 | ||||||
Trade receivables due from seller | 2,336 | ||||||
Notes payable to seller | 0 | ||||||
Total consideration | 5,332 | ||||||
Identifiable assets acquired and liabilities assumed | |||||||
Accounts receivable | 2,079 | 2,079 | |||||
Inventory and other assets | 341 | 341 | |||||
Accounts payable | (456) | (456) | |||||
Deferred tax liabilities, net | (842) | (842) | |||||
Accrued and other liabilities | (317) | (317) | |||||
Total identifiable net assets | 3,141 | 3,141 | |||||
Goodwill | 2,191 | $ 2,191 | |||||
Equity consideration (in shares) | 28,157 | ||||||
Contingent consideration | 300 | ||||||
Decrease to intangible assets | $ 1,000 | ||||||
Wigmore | Non-compete agreement | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | 60 | $ 60 | |||||
Wigmore | Customer relationships | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | 2,276 | 2,276 | |||||
Ecomedic | |||||||
Consideration paid: | |||||||
Cash, net of cash acquired | 11,338 | ||||||
Class A Common Stock issued | 6,513 | ||||||
Trade receivables due from seller | 1,679 | ||||||
Notes payable to seller | 2,153 | ||||||
Total consideration | 21,683 | ||||||
Identifiable assets acquired and liabilities assumed | |||||||
Accounts receivable | 15 | 15 | |||||
Inventory and other assets | 1,262 | 1,262 | |||||
Accounts payable | (772) | (772) | |||||
Deferred tax liabilities, net | (2,008) | (2,008) | |||||
Accrued and other liabilities | (340) | (340) | |||||
Total identifiable net assets | 4,232 | 4,232 | |||||
Goodwill | 17,451 | $ 17,451 | |||||
Equity consideration (in shares) | 401,021 | ||||||
Measurement period adjustments | $ 200 | $ 200 | |||||
Ecomedic | Non-compete agreement | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | 588 | 588 | |||||
Ecomedic | Customer relationships | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | 5,487 | 5,487 | |||||
Sidermica | |||||||
Consideration paid: | |||||||
Cash, net of cash acquired | 6,861 | ||||||
Class A Common Stock issued | 815 | ||||||
Trade receivables due from seller | 1,581 | ||||||
Notes payable to seller | 0 | ||||||
Total consideration | 9,257 | ||||||
Identifiable assets acquired and liabilities assumed | |||||||
Accounts receivable | 1,657 | 1,657 | |||||
Inventory and other assets | 454 | 454 | |||||
Accounts payable | 0 | 0 | |||||
Deferred tax liabilities, net | 0 | 0 | |||||
Accrued and other liabilities | 0 | 0 | |||||
Total identifiable net assets | 4,911 | 4,911 | |||||
Goodwill | 4,346 | $ 4,346 | |||||
Equity consideration (in shares) | 50,195 | ||||||
Measurement period adjustments | 1,980 | $ 1,980 | |||||
Sidermica | Non-compete agreement | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | 100 | 100 | |||||
Sidermica | Customer relationships | |||||||
Identifiable assets acquired and liabilities assumed | |||||||
Intangible assets | $ 2,700 | $ 2,700 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 88,792 | $ 68,147 | $ 267,743 | $ 182,197 |
Delivery Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 49,094 | 36,182 | 155,524 | 96,798 |
Consumables | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 39,698 | $ 31,965 | $ 112,219 | $ 85,399 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of inventory (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 26,015 | $ 12,024 |
Finished goods | 75,691 | 23,237 |
Total inventories | $ 101,706 | $ 35,261 |
Balance Sheet Components - Sc_2
Balance Sheet Components - Schedule of accrued payroll-related expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Accrued compensation | $ 3,733 | $ 15,262 |
Accrued payroll taxes | 2,109 | 922 |
Accrued benefits | 5,026 | 3,022 |
Accrued sales commissions | 9,782 | 9,456 |
Total accrued payroll-related expenses | $ 20,650 | $ 28,662 |
Balance Sheet Components - Sc_3
Balance Sheet Components - Schedule of accrued expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Sales and VAT tax payables | $ 5,116 | $ 5,817 |
Accrued interest | 4,687 | 2,786 |
Contingent consideration | 0 | 783 |
Note payable due seller | 2,144 | 2,153 |
Royalty liabilities | 1,353 | 1,074 |
Other | 3,811 | 2,109 |
Total other accrued expenses | $ 17,111 | $ 14,722 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Lessee, Lease, Description [Line Items] | ||
Right-of-use assets, net | $ 14,292 | $ 14,992 |
Experience Center | ||
Lessee, Lease, Description [Line Items] | ||
Right-of-use assets, net | 1,100 | |
Operating lease liability | 1,100 | |
Office | ||
Lessee, Lease, Description [Line Items] | ||
Right-of-use assets, net | 1,600 | |
Operating lease liability | $ 1,600 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) $ / shares in Units, $ in Millions | Nov. 03, 2021 USD ($) $ / shares shares | May 04, 2021 shares | Sep. 30, 2022 shares |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Stock issued upon conversion (in shares) | 11,500,000 | ||
Minimum | Level 2 | Exercise price | Monte Carlo simulation | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant, measurement input | 10 | ||
Maximum | Level 2 | Exercise price | Monte Carlo simulation | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant, measurement input | 18 | ||
Public warrants | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrants outstanding (in shares) | 0 | ||
Warrant redemption price (in dollars per share) | $ / shares | $ 0.10 | ||
Warrants exercised (in shares) | 16,200,000 | ||
Warrants exercised, cash (in shares) | 16,100,000 | ||
Warrants, exercise price (in dollars per share) | $ / shares | $ 11.50 | ||
Warrants exercised, cashless basis (in shares) | 74,104 | ||
Stock issued upon conversion (in shares) | 26,732 | ||
Warrants redeemed (in shares) | 75,016 | ||
Proceeds from exercise of warrants | $ | $ 185.4 | ||
Public warrants, initial public offer | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrants exercised (in shares) | 15,300,000 | ||
Public warrants, converted from private warrant sale | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrants exercised (in shares) | 900,000 | ||
Private placement warrants | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrants outstanding (in shares) | 7,000,000 | ||
Warrants exercised (in shares) | 300,000 | ||
Proceeds from exercise of warrants | $ | $ 3 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of assets and liabilities measured at fair value on recurring basis (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Liabilities | ||
Warrant liabilities | $ 22,295 | $ 93,816 |
Recurring | Money market funds | ||
Assets | ||
Money market funds | 642,445 | |
Recurring | Private placement warrants | ||
Liabilities | ||
Warrant liabilities | 22,295 | |
Level 1 | Recurring | Money market funds | ||
Assets | ||
Money market funds | 642,445 | |
Level 1 | Recurring | Private placement warrants | ||
Liabilities | ||
Warrant liabilities | 0 | |
Level 2 | Recurring | Money market funds | ||
Assets | ||
Money market funds | 0 | |
Level 2 | Recurring | Private placement warrants | ||
Liabilities | ||
Warrant liabilities | 22,295 | |
Level 3 | Recurring | Money market funds | ||
Assets | ||
Money market funds | 0 | |
Level 3 | Recurring | Private placement warrants | ||
Liabilities | ||
Warrant liabilities | $ 0 |
Property and Equipment, net (De
Property and Equipment, net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||||
Less: accumulated depreciation and amortization | $ (11,221) | $ (11,221) | $ (8,561) | ||
Property and equipment, net | 18,099 | 18,099 | 16,183 | ||
Loss on disposal of property and equipment, net | 1,800 | 1,800 | |||
Depreciation of property and equipment | 2,001 | $ 1,028 | 5,269 | $ 2,446 | |
Cost of sales | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation of property and equipment | 588 | 339 | 1,593 | 965 | |
General and administrative | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation of property and equipment | 927 | 689 | 2,463 | 1,481 | |
Selling and marketing | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation of property and equipment | 486 | $ 0 | 1,213 | $ 0 | |
Depreciable property and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Plant and equipment, including finance lease, gross | 26,977 | 26,977 | 19,391 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Plant and equipment, including finance lease, gross | 4,640 | $ 4,640 | 4,074 | ||
Furniture and fixtures | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 2 years | ||||
Furniture and fixtures | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 7 years | ||||
Computers and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Plant and equipment, including finance lease, gross | 4,600 | $ 4,600 | 4,010 | ||
Computers and equipment | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 3 years | ||||
Computers and equipment | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 5 years | ||||
Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Plant and equipment, including finance lease, gross | 5,796 | $ 5,796 | 3,669 | ||
Machinery and equipment | Minimum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 2 years | ||||
Machinery and equipment | Maximum | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 5 years | ||||
Autos and trucks | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 5 years | ||||
Plant and equipment, including finance lease, gross | 1,220 | $ 1,220 | 1,163 | ||
Tooling | |||||
Property, Plant and Equipment [Line Items] | |||||
Useful life (years) | 5 years | ||||
Plant and equipment, including finance lease, gross | 594 | $ 594 | 1,389 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Plant and equipment, including finance lease, gross | 10,127 | 10,127 | 5,086 | ||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Plant and equipment, including finance lease, gross | $ 2,343 | $ 2,343 | $ 5,353 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets, net - Intangible assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Value | $ 110,815 | $ 110,815 | $ 112,299 | ||
Accumulated Amortization | (64,190) | (64,190) | (56,289) | ||
Net Carrying Value | 46,625 | 46,625 | 56,010 | ||
Amortization expense | 3,692 | $ 3,503 | 11,063 | $ 9,354 | |
Cost of sales | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortization expense | 2,245 | 2,233 | 6,864 | 6,697 | |
Selling and marketing | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortization expense | 858 | 500 | 2,356 | 1,464 | |
General and administrative | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortization expense | 589 | $ 770 | 1,843 | $ 1,193 | |
Trademarks | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Value | 10,839 | 10,839 | 10,048 | ||
Accumulated Amortization | (3,950) | (3,950) | (3,442) | ||
Net Carrying Value | 6,889 | $ 6,889 | $ 6,606 | ||
Estimated Useful Life (Years) | 15 years | 15 years | |||
Non-compete agreement | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Value | 758 | $ 758 | $ 809 | ||
Accumulated Amortization | (707) | (707) | (139) | ||
Net Carrying Value | 51 | $ 51 | $ 670 | ||
Estimated Useful Life (Years) | 3 years | 3 years | |||
Customer relationships | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Value | 17,137 | $ 17,137 | $ 18,625 | ||
Accumulated Amortization | (6,132) | (6,132) | (4,391) | ||
Net Carrying Value | 11,005 | $ 11,005 | $ 14,234 | ||
Customer relationships | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 5 years | 5 years | |||
Customer relationships | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 10 years | 10 years | |||
Developed technology | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Value | 73,188 | $ 73,188 | $ 70,900 | ||
Accumulated Amortization | (51,825) | (51,825) | (45,051) | ||
Net Carrying Value | 21,363 | $ 21,363 | $ 25,849 | ||
Estimated Useful Life (Years) | 8 years | ||||
Developed technology | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 3 years | ||||
Developed technology | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 8 years | ||||
Patents | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Value | 2,187 | $ 2,187 | $ 2,050 | ||
Accumulated Amortization | (385) | (385) | (295) | ||
Net Carrying Value | 1,802 | $ 1,802 | $ 1,755 | ||
Patents | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 3 years | 3 years | |||
Patents | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 19 years | 19 years | |||
Capitalized software | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Value | 6,706 | $ 6,706 | $ 9,867 | ||
Accumulated Amortization | (1,191) | (1,191) | (2,971) | ||
Net Carrying Value | $ 5,515 | $ 5,515 | $ 6,896 | ||
Capitalized software | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 3 years | 3 years | |||
Capitalized software | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Estimated Useful Life (Years) | 5 years | 5 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets, net - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||||||
Loss on disposal of intangible assets | $ 2,900 | $ 2,900 | ||||
Increase in goodwill | $ 2,154 | $ 25,304 | ||||
Ecomedic | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Increase in goodwill | $ 200 | $ 200 | ||||
Sidermica | ||||||
Finite-Lived Intangible Assets [Line Items] | ||||||
Increase in goodwill | $ 1,980 | $ 1,980 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets, net - Goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 123,694 | $ 98,531 |
Measurement period adjustments | 2,154 | 25,304 |
Foreign currency translation impact | (3,100) | (970) |
Ending balance | $ 122,748 | $ 122,865 |
Long-term Debt - Narrative (Det
Long-term Debt - Narrative (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Dec. 30, 2021 USD ($) | Sep. 14, 2021 USD ($) day $ / shares | Sep. 09, 2021 USD ($) $ / shares | Sep. 30, 2022 USD ($) $ / shares | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) $ / shares | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Event of default, default interest rate, maximum | 1% | |||||||
Amortization of debt issuance costs | $ 3,172,000 | $ 0 | ||||||
Purchase of capped calls related to Convertible Senior Notes | $ 90,150,000 | |||||||
Write off of deferred finance costs | $ 2,300,000 | |||||||
Debt prepayment cost | $ 2,000,000 | |||||||
Amortization of deferred financing costs | 0 | 3,005,000 | ||||||
Call option | ||||||||
Debt Instrument [Line Items] | ||||||||
Initial cap price (in dollars per share) | $ / shares | $ 47.94 | |||||||
Premium over sales price | 100% | |||||||
Purchase of capped calls related to Convertible Senior Notes | $ 90,200,000 | |||||||
Credit Agreement Due 2026 | Revolving credit facility | Line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum borrowing capacity | $ 50,000,000 | |||||||
Line of credit, accordion feature | $ 50,000,000 | |||||||
Long-term debt | $ 0 | $ 0 | ||||||
Leverage ratio, maximum | 3 | |||||||
Fixed charge coverage ratio, minimum | 1.15 | |||||||
Unused commitment fee percentage | 0.25% | |||||||
Credit Agreement Due 2026 | Revolving credit facility | Line of credit | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Unused commitment fee percentage | 0.25% | |||||||
Credit Agreement Due 2026 | Revolving credit facility | Line of credit | Minimum | LIBOR | Variable rate one | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2% | |||||||
Credit Agreement Due 2026 | Revolving credit facility | Line of credit | Minimum | Base rate | Variable rate two | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1% | |||||||
Credit Agreement Due 2026 | Revolving credit facility | Line of credit | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Unused commitment fee percentage | 0.35% | |||||||
Credit Agreement Due 2026 | Revolving credit facility | Line of credit | Maximum | LIBOR | Variable rate one | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 2.50% | |||||||
Credit Agreement Due 2026 | Revolving credit facility | Line of credit | Maximum | Base rate | Variable rate two | ||||||||
Debt Instrument [Line Items] | ||||||||
Basis spread on variable rate | 1.50% | |||||||
1.25% Convertible Senior Notes Due 2026 | Convertible Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt | $ 733,086,000 | $ 733,086,000 | ||||||
Face amount | $ 750,000,000 | |||||||
Stated interest rate | 1.25% | 1.25% | 1.25% | |||||
Accordion feature, settlement period | 13 days | |||||||
Accordion feature, increase limit | $ 100,000,000 | |||||||
Conversion ratio | 0.0314859 | |||||||
Conversion price (in dollars per share) | $ / shares | $ 31.76 | $ 31.76 | $ 31.76 | |||||
Convertible, threshold percentage of stock price trigger | 130% | |||||||
Convertible, threshold trading days | day | 20 | |||||||
Convertible, threshold consecutive trading days | day | 30 | |||||||
Convertible, minimum aggregate principal outstanding | $ 100,000,000 | |||||||
Event of default, cure period, interest payments | 30 days | |||||||
Event of default, cure period | 60 days | |||||||
Event of default, indebtedness threshold amount | $ 45,000,000 | |||||||
Event of default, minimum percent of aggregate outstanding principal due | 25% | |||||||
Event of default, default interest rate period | 180 days | |||||||
Debt issuance costs | $ 21,300,000 | |||||||
Amortization of debt issuance costs | $ 1,100,000 | $ 3,200,000 | 200,000 | |||||
Debt term | 4 years | |||||||
1.25% Convertible Senior Notes Due 2026 | Convertible Debt | Level 2 | ||||||||
Debt Instrument [Line Items] | ||||||||
Convertible Debt, Fair Value Disclosures | $ 603,750,000 | $ 603,750,000 | ||||||
Existing Debt Prior to the Closing of the Business Combination | ||||||||
Debt Instrument [Line Items] | ||||||||
Amortization of debt issuance costs | $ 500,000 |
Long-term Debt - Schedule of lo
Long-term Debt - Schedule of long-term debt (Details) - Convertible Debt - 1.25% Convertible Senior Notes Due 2026 - USD ($) $ in Thousands | Sep. 30, 2022 | Sep. 14, 2021 |
Debt Instrument [Line Items] | ||
Stated interest rate | 1.25% | 1.25% |
Principal Amount | $ 750,000 | |
Unamortized Issuance Costs | 16,914 | |
Net Carrying Value | 733,086 | |
Level 2 | ||
Debt Instrument [Line Items] | ||
Fair value of debt | $ 603,750 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||||
Income tax (benefit) expense | $ (821) | $ (1,129) | $ 1,870 | $ (3,305) | |
Effective tax rate (as a percent) | 119.12% | 0.53% | (4.41%) | 0.92% | |
Gross unrecognized tax benefits | $ 100 | $ 100 | $ 200 |
Equity Based Compensation - Sum
Equity Based Compensation - Summary of share based compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | $ 7,449 | $ 5,082 | $ 20,876 | $ 8,624 |
Cost of sales | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | 191 | 70 | 624 | 222 |
Selling and marketing | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | 2,498 | 1,064 | 7,331 | 1,413 |
Research and development | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | 215 | 70 | 602 | 103 |
General and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Stock-based compensation expense | $ 4,545 | $ 3,878 | $ 12,319 | $ 6,886 |
Equity Based Compensation - Sch
Equity Based Compensation - Schedule of unvested share activity (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
RSUs | |
Shares | |
Outstanding, beginning balance (in shares) | shares | 380,775 |
Granted (in shares) | shares | 2,724,851 |
Vested (in shares) | shares | (187,727) |
Forfeited (in shares) | shares | (388,691) |
Outstanding, ending balance (in shares) | shares | 2,529,208 |
Weighted Average Grant Date Fair Value | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 25.88 |
Granted (in dollars per share) | $ / shares | 13.67 |
Vested (in dollars per share) | $ / shares | 20.60 |
Forfeited (in dollars per share) | $ / shares | 15.31 |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 14.74 |
PSUs | |
Shares | |
Outstanding, beginning balance (in shares) | shares | 975,000 |
Granted (in shares) | shares | 1,629,395 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | (209,738) |
Outstanding, ending balance (in shares) | shares | 2,394,657 |
Weighted Average Grant Date Fair Value | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 11.39 |
Granted (in dollars per share) | $ / shares | 9.10 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 14.30 |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 9.58 |
Equity-Based Compensation - Sch
Equity-Based Compensation - Schedule of stock option activity (Details) $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) $ / shares shares | |
Number of Options | |
Outstanding, beginning balance (in shares) | shares | 6,785,020 |
Granted (in shares) | shares | 10,500 |
Unvested forfeited (in shares) | shares | (951,500) |
Vested Expired (in shares) | shares | (39,050) |
Outstanding, ending balance (in shares) | shares | 5,804,970 |
Options exercisable (in shares) | shares | 1,293,800 |
Options vested and expected to vest (in shares) | shares | 5,804,970 |
Weighted Average Exercise Price | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 15.64 |
Granted (in dollars per share) | $ / shares | 22.68 |
Unvested forfeited (in dollars per share) | $ / shares | 18.43 |
Vested Expired (in dollars per share) | $ / shares | 14.53 |
Outstanding, ending balance (in dollars per share) | $ / shares | 15.20 |
Options exercisable (in dollars per share) | $ / shares | 13.79 |
Options vested and expected to vest (in dollars per share) | $ / shares | $ 15.20 |
Weighted Average Remaining Contractual Term and Aggregate Intrinsic Value | |
Options outstanding, weighted average remaining contractual term | 8 years 8 months 1 day |
Options exercisable, weighted average remaining contractual term | 8 years 6 months 29 days |
Options vested and expected to vest, weighted average remaining contractual term | 8 years 8 months 1 day |
Options outstanding, aggregate intrinsic value | $ | $ 0 |
Options exercisable, aggregate intrinsic value | $ | 0 |
Options vested and expected to vest, aggregate intrinsic value | $ | $ 0 |
Related-Party Transactions (Det
Related-Party Transactions (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
May 04, 2021 USD ($) tradingDay $ / shares shares | Dec. 01, 2016 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Related Party Transaction [Line Items] | ||||||
Stock issued upon conversion (in shares) | shares | 11,500,000 | |||||
Payment of transaction costs | $ 57,000,000 | $ 56,976,000 | ||||
Private placement warrants | ||||||
Related Party Transaction [Line Items] | ||||||
Reverse recapitalization, contingent consideration, earnout period | 30 days | |||||
Financial and management advisory services | Affiliated entity | ||||||
Related Party Transaction [Line Items] | ||||||
Monitoring fee, quarterly amount | $ 125,000 | |||||
Monitoring fee, percentage of preceding 12-month EBITDA | 1.25% | |||||
Transaction rate | 1% | |||||
Related party, agreement term | 1 year | |||||
Related party, expiration period | 12 months | |||||
Transaction amount | $ 0 | $ 0 | $ 200,000 | |||
Payment of transaction costs | 21,000,000 | |||||
Financial and management advisory services | Minimum | Affiliated entity | ||||||
Related Party Transaction [Line Items] | ||||||
Transaction rate | 1% | |||||
Financial and management advisory services | Maximum | Affiliated entity | ||||||
Related Party Transaction [Line Items] | ||||||
Transaction rate | 2% | |||||
Miami Beach Office reimbursement expense | Affiliated entity | ||||||
Related Party Transaction [Line Items] | ||||||
Transaction amount | $ 0 | $ 0 | ||||
Vesper Founders | ||||||
Related Party Transaction [Line Items] | ||||||
Reverse recapitalization, contingent consideration, earnout period | 1 year | |||||
Reverse recapitalization, contingent consideration, stock price trigger (in dollars per share) | $ / shares | $ 12 | |||||
Reverse recapitalization, contingent consideration, threshold days | tradingDay | 20 | |||||
Reverse recapitalization, contingent consideration, consecutive threshold days | tradingDay | 30 | |||||
Reverse recapitalization, contingent consideration, commencement period | 150 days | |||||
LCP | ||||||
Related Party Transaction [Line Items] | ||||||
Reverse recapitalization, threshold percentage to designate one director | 10% | |||||
Reverse recapitalization, threshold percentage to designate two directors | 15% | |||||
Reverse recapitalization, threshold percentage to designate three directors | 40% | |||||
Reverse recapitalization, threshold percentage to designate one director on board | 10% |
Stockholders_ Equity (Details)
Stockholders’ Equity (Details) $ / shares in Units, $ in Thousands | 9 Months Ended | ||||||
Sep. 27, 2022 USD ($) shares | May 04, 2021 USD ($) shares | Sep. 30, 2022 USD ($) vote $ / shares shares | Sep. 30, 2021 USD ($) | Sep. 26, 2022 USD ($) | Dec. 31, 2021 $ / shares shares | May 03, 2021 $ / shares shares | |
Class of Stock [Line Items] | |||||||
Common stock, shares authorized (in shares) | 320,000,000 | 320,000,000 | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||
Common stock, number of votes | vote | 1 | ||||||
Common stock, shares issued (in shares) | 143,201,041 | 150,598,047 | |||||
Common stock, shares outstanding (in shares) | 125,399,913 | 143,201,041 | 150,598,047 | 54,358 | |||
Consideration received on transaction | $ | $ 350,000 | ||||||
Legacy HydraFacial shares (in shares) | 35,501,743 | ||||||
Initial payment | $ | $ 80,000 | $ 0 | |||||
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | |||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | |||||
Preferred stock, shares issued (in shares) | 0 | 0 | |||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | |||||
Accelerated Share Repurchase | |||||||
Class of Stock [Line Items] | |||||||
Initial payment | $ | $ 100,000 | ||||||
Stock repurchased (in shares) | 7,700,000 | ||||||
Stock repurchased during period percentage | 80% | ||||||
Class A common stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, shares issued (in shares) | 125,329,053 | ||||||
Common stock, shares outstanding (in shares) | 125,329,053 | ||||||
Consideration received on transaction (in shares) | 35,000,000 | ||||||
Consideration received on transaction | $ | $ 350,000 | ||||||
Legacy HydraFacial shares (in shares) | 35,501,743 | ||||||
Common stock repurchase authorized | $ | $ 200,000 | ||||||
Stock repurchased (in shares) | 2,672,690 | ||||||
Class A common stock | Accelerated Share Repurchase | |||||||
Class of Stock [Line Items] | |||||||
Common stock repurchase authorized | $ | $ 100,000 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) segment | Sep. 30, 2021 USD ($) | |
Disaggregation of Revenue [Line Items] | ||||
Number of operating segments | segment | 1 | |||
Number of reportable segments | segment | 1 | |||
Net sales | $ 88,792 | $ 68,147 | $ 267,743 | $ 182,197 |
Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 58,375 | 45,046 | 178,335 | 118,986 |
Asia-Pacific | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 15,110 | 10,490 | 38,397 | 31,721 |
Europe, the Middle East and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 15,307 | $ 12,611 | $ 51,011 | $ 31,490 |
Net Income (Loss) Attributabl_3
Net Income (Loss) Attributable to Common Shareholders - Schedule of basic and diluted earnings per share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) available to common shareholders - basic | $ 131 | $ (215,145) | $ 40,569 | $ (357,797) |
Plus: Income (loss) on Private placement warrants | (4,284) | 0 | (71,521) | 0 |
Net income (loss) available to common shareholders - diluted | $ (4,153) | $ (215,145) | $ (30,952) | $ (357,797) |
Weighted average common shares outstanding - basic (in shares) | 150,788,695 | 132,306,346 | 150,706,795 | 87,219,681 |
Effect of dilutive shares: | ||||
Private placement warrants (in shares) | 629,015 | 0 | 1,311,451 | 0 |
Weighted average common shares outstanding - diluted (in shares) | 151,417,710 | 132,306,346 | 152,018,246 | 87,219,681 |
Basic net income (loss) per share (in dollars per share) | $ 0 | $ (1.63) | $ 0.27 | $ (4.10) |
Diluted net income (loss) per share (in dollars per share) | $ (0.03) | $ (1.63) | $ (0.20) | $ (4.10) |
Net Income (Loss) Attributabl_4
Net Income (Loss) Attributable to Common Shareholders - Schedule of antidilutive securities excluded from earnings per share computation (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Convertible Notes | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded (in shares) | 23,614,425 | 11,807,213 | 23,614,425 | 7,871,475 |
RSUs | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded (in shares) | 2,529,208 | 200,247 | 2,529,208 | 133,498 |
PSUs | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded (in shares) | 2,394,657 | 975,000 | 2,394,657 | 650,000 |
Stock Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded (in shares) | 5,804,970,000 | 8,521,900,000 | 5,804,970,000 | 5,557,267,000 |
Public and Private Warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded (in shares) | 0 | 24,666,666 | 0 | 16,444,444 |