Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Mar. 01, 2023 | Jun. 30, 2022 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Entity Registrant Name | Zevia PBC | ||
Amendment Flag | false | ||
Entity Central Index Key | 0001854139 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Incorporation, State or Country Code | DE | ||
Securities Act File Number | 001-40630 | ||
Entity Tax Identification Number | 86-2862492 | ||
Entity Address, Address Line One | 15821 Ventura Blvd. | ||
Entity Address, Address Line Two | Suite 135 | ||
Entity Address, City or Town | Encino | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 91436 | ||
City Area Code | 855 | ||
Local Phone Number | 469-3842 | ||
Title of 12(b) Security | Class A common stock, par value $0.001 pershare | ||
Trading Symbol | ZVIA | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Small Business | true | ||
Entity Voluntary Filers | No | ||
Audit Report | false | ||
Documents Incorporated by Reference | Portions of the Registrant's definitive proxy statement for use in connection with its 2023 Annual Meeting of Stockholders, which is to be filed no later than 120 days after December 31, 2022 , are incorporated by reference into Part III of this Annual Report on Form 10-K. | ||
Auditor Name | Deloitte & Touche LLP | ||
Auditor Location | Los Angeles, California | ||
Auditor Firm ID | 34 | ||
Entity Public Float | $ 102.6 | ||
Common Class A [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 48,564,294 | ||
Common Class B [Member] | |||
Document Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 21,798,600 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 47,399,000 | $ 43,110,000 |
Short-Term Investments | 0 | 30,000,000 |
Accounts receivable, net | 11,077,000 | 9,047,000 |
Inventories | 27,576,000 | 31,501,000 |
Prepaid expenses and other current assets | 2,607,000 | 3,421,000 |
Total current assets | 88,659,000 | 117,079,000 |
Property and equipment, net | 4,641,000 | 3,169,000 |
Right-of-use assets under operating leases, net | 708,000 | 211,000 |
Intangible assets, net | 4,385,000 | 4,233,000 |
Other non-current assets | 539,000 | 301,000 |
Total assets | 98,932,000 | 124,993,000 |
Current liabilities: | ||
Accounts payable | 8,023,000 | 13,492,000 |
Accrued expenses and other current liabilities | 8,408,000 | 6,705,000 |
Current portion of operating lease liabilities | 715,000 | 236,000 |
Total current liabilities | 17,146,000 | 20,433,000 |
Operating lease liabilities, net of current portion | 0 | 1,000 |
Total liabilities | 17,146,000 | 20,434,000 |
Commitments and contingencies (Note 9) | ||
Permanent Equity (Deficit) | ||
Preferred Stock, $0.001 par value. 10,000,000 shares authorized, no shares issued and outstanding as of December 31,2021.No shares authorized, issued and outstanding as of December31,2020 | 0 | 0 |
Class A common stock value | 48,000 | 34,000 |
Class B common stock value | 22,000 | 30,000 |
Additional paid-in capital | 189,724,000 | 174,404,000 |
Accumulated deficit | (79,843,000) | (45,986,000) |
Total Zevia's Equity / members' (deficit) | 109,951,000 | 128,482,000 |
Noncontrolling Interests | (28,165,000) | (23,923,000) |
Total Equity | 81,786,000 | 104,559,000 |
Total liabilities and equity | $ 98,932,000 | $ 124,993,000 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common Class A [Member] | ||
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 550,000,000 | |
Common stock shares issued | 47,774,046 | 34,463,417 |
Common stock shares outstanding | 47,774,046 | 34,463,417 |
Common Class B [Member] | ||
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 250,000,000 | |
Common stock shares issued | 21,798,600 | 30,113,152 |
Common stock shares outstanding | 21,798,600 | 30,113,152 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Statement of Comprehensive Income [Abstract] | |||
Net sales | $ 163,181 | $ 138,172 | |
Cost of goods sold | 93,160 | 74,231 | |
Gross profit | 70,021 | 63,941 | |
Operating expenses: | |||
Selling and marketing | 52,869 | 45,130 | |
General and administrative | 36,793 | 27,516 | |
Equity-based compensation | 26,880 | 77,724 | |
Depreciation and amortization | 1,347 | 997 | |
Total operating expenses | 117,889 | 151,367 | |
Loss from operations | (47,868) | (87,426) | |
Other income (expense), net | 286 | (207) | |
Loss before income taxes | (47,582) | (87,633) | |
Provision for income taxes | (65) | (34) | |
Net loss and comprehensive loss | (47,647) | (87,667) | |
Net loss attributable to Zevia LLC prior to the Reorganization Transactions | 0 | 1,913 | |
Net loss attributable to noncontrolling interest | 13,790 | 39,768 | |
Net loss attributable to Zevia PBC | $ (33,857) | $ (45,986) | |
Net loss per share attributable to common stockholders, basic | $ (0.81) | $ (1.33) | [1] |
Net loss per share attributable to common shareholders, diluted | $ (0.81) | $ (1.33) | [1] |
Weighted average common units outstanding, basic | 43,469,383 | 34,450,409 | |
Weighted average common units outstanding, diluted | 43,469,383 | 34,450,409 | |
[1] (1) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the reorganization transactions and initial public offering (see Note 16). |
Consolidated Statements of Chan
Consolidated Statements of Changes In Redeemable Convertible Preferred Units And Equity Deficit - USD ($) $ in Thousands | Total | IPO [Member] | Restatement Adjustment [Member] | Redeemable Convertible Preferred Units [Member] | Redeemable Convertible Preferred Units [Member] Restatement Adjustment [Member] | Common Class A [Member] | Common Class A [Member] IPO [Member] | Common Class A [Member] IPO [Member] Zevia LLC [Member] | Common Class A [Member] Restatement Adjustment [Member] | Common Class B [Member] Zevia LLC [Member] | Additional Paid-In Capital [Member] | Additional Paid-In Capital [Member] Zevia LLC [Member] | Additional Paid-In Capital [Member] IPO [Member] | Additional Paid-In Capital [Member] Restatement Adjustment [Member] | Accumulated Deficit [Member] | Member Defecit [Member] | Member Defecit [Member] Zevia LLC [Member] | Member Defecit [Member] IPO [Member] | Member Defecit [Member] IPO [Member] Zevia LLC [Member] | Member Defecit [Member] Restatement Adjustment [Member] | Noncontrolling Interest [Member] | Common Stock [Member] Common Class A [Member] | Common Stock [Member] Common Class B [Member] |
Beginning Balance (in shares) at Dec. 31, 2020 | 26,322,803 | ||||||||||||||||||||||
Beginning Balance at Dec. 31, 2020 | $ 232,457 | ||||||||||||||||||||||
Beginning Balance at Dec. 31, 2020 | $ (196,812) | $ (196,812) | |||||||||||||||||||||
Exercise of common units prior to the Reorganization Transactions | 10 | 10 | |||||||||||||||||||||
Equity-based compensation prior to the Reorganization Transactions | 73 | 73 | |||||||||||||||||||||
Net loss prior to the Reorganization Transactions | (1,913) | (1,913) | |||||||||||||||||||||
Distributions to unitholders for tax payments | (2,669) | (2,669) | |||||||||||||||||||||
Balance prior to the Reorganization Transactions | (201,311) | $ 232,457 | (201,311) | ||||||||||||||||||||
Balance prior to the Reorganization Transactions (Shares) | 26,322,803 | ||||||||||||||||||||||
Issuance of common stock, net of commission Shares | 6,900,000 | 3,767,440 | 30,114,488 | ||||||||||||||||||||
Issuance of common stock, net of commission | 90,080 | $ 7 | $ 3 | $ 30 | $ 2,034 | $ (30) | $ 90,073 | $ 2,037 | |||||||||||||||
Share Based Compensation Arrangement Stock Options Cancelled | (4) | $ 2 | (4) | $ 425 | $ (423) | ||||||||||||||||||
Stock Repurchased and Retired During Period, Shares | 32,560 | ||||||||||||||||||||||
Offering costs | (8,367) | (8,367) | |||||||||||||||||||||
Repurchase and cancellation of Zevia LLC units | (17) | $ (17) | |||||||||||||||||||||
Repurchase and cancellation of Zevia LLC units, Shares | (1,336) | ||||||||||||||||||||||
Allocation of equity to noncontrolling interest | 0 | $ (15,845) | $ 15,845 | ||||||||||||||||||||
Exercise of stock options | (178) | (178) | |||||||||||||||||||||
Exercise of stock options Shares | 46,967 | ||||||||||||||||||||||
Equity-based compensation | 77,651 | 77,651 | |||||||||||||||||||||
Net loss | (85,754) | $ (45,986) | (39,768) | ||||||||||||||||||||
Ending Balance at Dec. 31, 2021 | 104,559 | $ 232,457 | $ 24 | 174,404 | $ 12,800 | (45,986) | $ 219,633 | (23,923) | $ 34 | $ 30 | |||||||||||||
Ending Balance (in shares) at Dec. 31, 2021 | 23,716,450 | 34,463,417 | 30,113,152 | ||||||||||||||||||||
Ending Balance at Dec. 31, 2021 | $ (232,457) | ||||||||||||||||||||||
Ending Balance (in shares) at Dec. 31, 2021 | (26,322,803) | ||||||||||||||||||||||
Vesting and release of common stock under equity incentive plans, net (in shares) | 4,749,662 | ||||||||||||||||||||||
Vesting and release of common stock under equity incentive plans, net | (2,130) | (2,136) | $ 6 | ||||||||||||||||||||
Exchange of Class B common stock for Class A common stock (in shares) | 8,314,552 | (8,314,552) | |||||||||||||||||||||
Exchange of Class B common stock for Class A common stock | (9,548) | 9,548 | $ 8 | $ (8) | |||||||||||||||||||
Exercise of stock options | $ 124 | 124 | |||||||||||||||||||||
Exercise of stock options Shares | 246,415 | 246,415 | |||||||||||||||||||||
Equity-based compensation | $ 26,880 | 26,880 | |||||||||||||||||||||
Net loss | (47,647) | (33,857) | (13,790) | ||||||||||||||||||||
Ending Balance at Dec. 31, 2022 | $ 81,786 | $ 189,724 | $ (79,843) | $ (28,165) | $ 48 | $ 22 | |||||||||||||||||
Ending Balance (in shares) at Dec. 31, 2022 | 47,774,046 | 21,798,600 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Operating activities: | |||
Net loss | $ (47,647) | $ (87,667) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Non-cash lease expense | 653 | 562 | |
Depreciation and amortization | 1,347 | 997 | |
Loss (gain) on sale of equipment | 3 | (4) | |
Amortization of debt issuance cost | 64 | 94 | |
Equity-based compensation | 26,880 | 77,724 | |
Changes in operating assets and liabilities: | |||
Accounts receivable, net | (2,030) | (2,062) | |
Inventories | 3,925 | (10,701) | |
Prepaid expenses and other assets | 846 | (2,481) | |
Accounts payable | (5,850) | 4,396 | |
Accrued expenses and other current liabilities | 1,703 | 1,960 | |
Operating lease liabilities | (672) | (624) | |
Net cash used in operating activities | (20,778) | (17,806) | |
Investing activities: | |||
Proceeds from maturities of short-term investments | 30,000 | 0 | |
Payments for purchases of short-term investments | 0 | (30,000) | |
Purchases of property, equipment and software | (2,593) | (3,143) | |
Net cash provided by (used in) investing activities | 27,407 | (33,143) | |
Financing activities: | |||
Proceeds from revolving line of credit | [1] | 0 | 74,721 |
Repayment of revolving line of credit | [1] | 0 | (74,721) |
Payment of debt issuance costs | (334) | 0 | |
Minimum tax withholding paid on behalf of employees for net share settlement | (2,130) | 0 | |
Proceeds from exercise of stock options | 124 | 0 | |
Proceeds from exercise of common units | 0 | 10 | |
Exercise of stock options | 0 | (178) | |
Repurchase of Zevia LLC units | 0 | (17) | |
Distribution to unitholders for tax payments | 0 | (2,669) | |
Proceeds from issuance of Class A common stock sold in IPO, net of underwriting discounts and commissions | 0 | 139,689 | |
Use of proceeds from issuance of Class A common stock to purchase Zevia LLC Units | 0 | (49,609) | |
Cancellation of options in IPO | 0 | 2 | |
Cancellation of options | 0 | (4) | |
Payment of IPO costs | 0 | (8,101) | |
Net cash (used in) provided by financing activities | (2,340) | 79,123 | |
Net change from operating, investing, and financing activities | 4,289 | 28,174 | |
Cash and cash equivalents at beginning of period | 43,110 | 14,936 | |
Cash and cash equivalents at end of period | 47,399 | 43,110 | |
Non-cash investing and financing activities | |||
Capital expenditures included in accounts payable | 506 | 125 | |
Conversion of Class B common stock to Class A common stock | 9,548 | 0 | |
Operating lease right-of-use assets obtained in exchange for lease liabilities | 1,150 | 0 | |
Unpaid IPO offering costs | 0 | 266 | |
Supplemental Disclosure of Cash Flow Information: | |||
Cash paid for interest | 64 | 148 | |
Cash paid for income taxes | $ 69 | $ 0 | |
[1] Zevia PBC’s revolving line of credit provides for daily drawdowns and repayments of amounts outstanding. As of December 31, 2021, no amounts were outstanding due to the termination of the line of credit in July 2021. Consistent with the provisions of ASC Topic 230, Statement of Cash Flows, Zevia PBC has presented daily draw-downs and repayments under its revolving line of credit with its lender on a gross basis in the consolidated statements of cash flows for the year ended December 31, 2021 . |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Revolving Credit Facility [Member] | ||
Line of credit | $ 0 | $ 0 |
Description of Business and Bas
Description of Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |
Description of Business and Basis of Presentation | 1. DESCRIPTION OF BUSINESS Organization and operations Zevia PBC (the "Company") develops, markets, sells, and distributes a wide variety of zero sugar, zero calorie, non-GMO Project verified, gluten-free, Kosher, vegan, zero sodium carbonated and non-carbonated beverages under the Zevia® brand name that include a broad assortment of flavors across Soda, Energy Drinks, Organic Teas, Mixers, and Kidz drinks. Zevia PBC’s products are distributed and sold principally across the United States of America ("U.S.") and Canada through a diverse network of major retailers (both brick-and-mortar and e-commerce), including grocery stores, natural products stores, warehouse clubs, and specialty outlets. Zevia PBC’s products are manufactured and generally maintained at third-party beverage production and warehousing facilities located in both the United States and Canada. Initial Public Offering and Reorganization Transactions On July 21, 2021, the registration statement on Form S-1 of Zevia PBC was declared effective by the Securities and Exchange Commission ("SEC") related to the initial public offering ("IPO") of its Class A common stock. On July 22, 2021, the Company’s Class A common stock began trading on the New York Stock Exchange under the ticker symbol “ZVIA”. The Company completed the IPO of 10,700,000 shares of its Class A common stock at an offering price of $ 14.00 per share on July 26, 2021. The Company received aggregate net proceeds of approximately $ 139.7 million after deducting underwriting discounts and commissions of $ 10.1 million. The underwriters did not exercise their option to purchase 1,605,000 additional shares of Class A common stock and that option expired on August 20, 2021. In connection with the IPO, the Company completed the following transactions (“Reorganization Transactions”): • Zevia LLC recapitalized its common and preferred membership interests into a single class of common units and each common unit outstanding after giving effect thereto was reclassified as two Class B units on a one-to-two basis; • The Company amended and restated its certificate of incorporation in its entirety to, among other things: (i) authorize 800,000,000 shares of common stock, 550,000,000 shares of which are designated as “Class A Common Stock” and 250,000,000 shares of which are designated as “Class B Common Stock;” and (ii) authorize 10,000,000 shares of undesignated preferred stock that may be issued from time to time by the Company's Board of Directors in one or more series and amended and restated its bylaws in their entirety to, among other things: (a) establish procedures relating to the presentation of stockholder proposals at stockholder meetings; (b) establish procedures relating to the nomination of directors; and (c) conform to the provisions of the amended and restated certificate; • The limited liability company agreement of Zevia LLC was amended and restated (the “Amended and Restated Zevia LLC Agreement”) to, among other things, provide for Class A units and Class B units and appoint the Company as the sole managing member of Zevia LLC; • The Company assumed all outstanding equity awards of Zevia LLC on a one-to-two basis; • The Amended and Restated Zevia LLC Agreement classified the interests acquired by the Company as Class A units, reclassified the interests held by the continuing members of Zevia LLC as Class B units and permits the continuing members of Zevia LLC to exchange Class B units for shares of Class A common stock on a one-for-one basis or, at the election of the Company, for cash. For each membership unit of Zevia LLC that is reclassified as a Class B unit, the Company issued one corresponding share of its Class B common stock to the continuing members; • The Company contributed approximately $ 90.1 million of the net proceeds of the IPO to Zevia LLC to acquire 6,900,000 newly issued Class A units of Zevia LLC at a per-unit price equal to the per-share price paid by the underwriters for shares of Class A common stock in the IPO. The Company retained $ 81.7 million of the total IPO proceeds after $ 8.4 million of offering costs. The retained proceeds will ultimately be used by the Company for working capital and other general corporate purposes; • The Company used approximately $ 25.5 million of the net proceeds of the IPO to purchase 1,956,142 Class B units and corresponding shares of Class B common stock from certain of Zevia LLC’s unitholders, including certain members of senior management, at a per-unit price equal to the per-share price paid by the underwriters for shares of Class A common stock in the IPO. Such units were immediately converted into an equivalent number of Class A units; • The Company used approximately $ 0.4 million of the net proceeds of the IPO to cancel and cash-out of 32,560 outstanding options held by certain option holders, including certain members of senior management, at a per-option price equal to the per-share price paid by the underwriters for shares of Class A common stock in the IPO. The Company received an equivalent number of Class A units from Zevia LLC in exchange for the cancellation of such options; • Zevia PBC formed a new, first-tier merger subsidiary with respect to each blocker company of certain pre-IPO institutional investors (“Direct Zevia Stockholders”), and contemporaneously with the IPO, each respective merger subsidiary merged with and into the respective blocker company, with the blocker company surviving. Immediately thereafter, each blocker company merged with and into Zevia PBC, with Zevia PBC surviving. As a result of the blocker mergers, the 100 % owners of the blocker companies acquired an aggregate of 23,716,450 shares of newly issued Class A common stock and received approximately $ 23.7 million in cash consideration in exchange for 1,811,298 previously-held Class B units, which were immediately converted into an equivalent number of Class A units in the hands of Zevia PBC, and the blocker companies ceased to own any Zevia LLC units; and • The Company entered into an Amended and Restated Registration Rights Agreement with the Class B stockholders to provide for certain rights and restrictions after the IPO. Immediately following the closing of the IPO on July 26, 2021, Zevia LLC became the predecessor of the Company for financial reporting purposes. The Company is a holding company, and its sole material asset is its controlling equity interest in Zevia LLC. As the sole managing member of Zevia LLC, the Company operates and controls all of the business and affairs of Zevia LLC. This reorganization is accounted for as a reorganization of entities under common control. As a result, the consolidated financial statements of the Company will recognize the assets and liabilities received in the reorganization at their historical carrying amounts, as reflected in the historical financial statements of Zevia LLC. The Company has consolidated Zevia LLC in its financial statements and record a noncontrolling interest related to the Class B units held by the Class B stockholders on its consolidated balance sheet and statement of operations. As of December 31, 2022 and 2021, the Company held an economic interest of 68.7 % and 53.4 %, respectively, in Zevia LLC and the remaining 31.3 % and 46.6 %, respectively, represents the non-controlling interest. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("US GAAP"). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiary, Zevia LLC, that it controls due to ownership of a majority voting interest. All intercompany transactions and balances have been eliminated in consolidation. The Company owns a majority economic interest in, and operates and controls all of the businesses and affairs of, Zevia LLC. Accordingly, the Company has prepared these consolidated financial statements in accordance with Accounting Standards Codification (“ASC”) Topic 810, Consolidation . In connection with the IPO, the Company completed the Reorganization Transactions, which were accounted for consistent with a combination of entities under common control. As a result, the financial reports filed with the SEC by the Company subsequent to the Reorganization Transactions are prepared “as if” Zevia LLC is the accounting predecessor of the Company. The historical operations of Zevia LLC are deemed to be those of the Company. Thus, the consolidated financial statements included in this report reflect (i) the historical operating results and financial position of Zevia LLC prior to the Reorganization Transactions; (ii) the consolidated results of operations and financial position of the Company and Zevia LLC following the Reorganization Transactions; and (iii) the Company's equity structure for all periods presented. No step-up basis of intangible assets or goodwill was recorded. On January 1, 2022, Zevia PBC and Zevia LLC entered into a service agreement to transfer the services of all employees of Zevia PBC to Zevia LLC. Under terms of the service agreement between the entities, the payroll costs of employees are borne by Zevia LLC while certain other non-payroll costs, such as those associated with stock compensation arrangements, remain with Zevia PBC. In addition, pursuant to the Thirteenth Amended and Restated Limited Liability Company Agreement of Zevia LLC dated as of July 21, 2021, Zevia LLC shall reimburse Zevia PBC, for certain expenses for overhead, administrative, and other expenses, at Zevia PBC's discretion. For the year ended December 31, 2022, it was determined that the majority of such costs should be retained by Zevia PBC, with certain costs directly attributable to Zevia LLC being borne by that entity. These costs impacted the amount of net loss reported by Zevia LLC and consequently impacted the amount allocated to noncontrolling interest. Reclassifications Certain amounts from prior periods have been reclassified in the consolidated balance sheet and consolidated statement of operations and comprehensive loss to conform to the current period presentation. For the activity in the periods prior to the IPO and Reorganization Transactions, common stock, additional paid-in capital, and accumulated deficit information has been combined and presented as member’s deficit in the accompanying consolidated balance sheets and consolidated statements of changes in redeemable convertible preferred units and equity (deficit). Consolidated Balance Sheet: The following table presents the adjustments made to the Consolidated Balance Sheet as of December 31, 2021, in order to reclassify computer software costs from property and equipment, net, to intangible assets, net in accordance with Accounting Standard Codification ("ASC") Topic 350, Intangibles—Goodwill and Other: (in thousands) December 31, 2021 Adjustments December 31, 2021 (adjusted) Property and equipment, net $ 3,664 $ ( 495 ) $ 3,169 Intangible assets, net 3,738 495 4,233 Consolidated Statement of Operations and Comprehensive Loss: The following table presents the reclassifications made to the Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2021 in order to reclassify repackaging and handling costs from cost of goods sold to selling and marketing expenses. The Company believes this classification change better portrays the financial impacts of the fulfillment activities conducted by the Company. The Company made this change in classification during the year ended December 31, 2022 as a result of an increasing trend in the occurrence of such fulfillment costs in the business. (in thousands) Year Ended December 31, 2021 Reclassification Year Ended December 31, 2021 Cost of goods sold $ 76,958 $ ( 2,727 ) $ 74,231 Gross profit 61,214 2,727 63,941 Selling and marketing expenses 42,403 2,727 45,130 Use of estimates The preparation of the consolidated financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as the reported amount of net sales and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made by the Company relate to: net sales and associated cost recognition; the useful lives assigned to and the recoverability of property and equipment; reserves recorded for inventory obsolescence; the incremental borrowing rate for lease liabilities; allowance for doubtful accounts; recoverability of intangible assets; realization of deferred tax assets; and the determination of the fair value of equity instruments, including redeemable convertible preferred and common units, restricted unit awards, and equity-based compensation awards. On an ongoing basis, the Company evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of its assets and liabilities. As of December 31, 2022, the Company’s operations continued to be impacted by the effects of the COVID-19 pandemic including the emergence of new variants, with respect to broad-based inflation in input costs, logistics, manufacturing and labor costs. During the year ended December 31, 2022 , the Company experienced significant inflationary impact, which has created headwinds that the Company expects to continue into 2023. The effects of the COVID-19 pandemic are expected to continue to impact global economies, and the Company will continue to monitor the situation and the effects on its business and operations, particularly if the COVID-19 pandemic, including the emergence of new variants, continues for an extended period of time. Cash, cash equivalents and investments Cash and cash equivalents include cash and investments in short-term, highly liquid securities, with original maturities of three months or less. Investments with original maturities at the date of acquisition of more than three months are classified as short-term investments or long-term investments based on the remaining contractual maturity of the security at the reporting date. As of December 31, 2022 , the Company did no t hold any investments. As of December 31, 2021, the Company held $ 27.0 million of time deposits with contractual maturities of less than three months, which are classified as cash and cash equivalents on the consolidated balance sheets, and $ 30 million of time deposits with contractual maturities of greater than three months but less than one year which are classified as short-term investments on the consolidated balance sheets. The Company maintains cash deposits with high credit quality financial institutions. The deposits with these financial institutions may exceed the federally insured limits; however, these deposits typically are redeemable upon demand. The Company has not experienced any loss because of these deposits and does not expect to incur any losses in the future. Fair value of financial instruments Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Subsequent changes in fair value of these financial assets and liabilities are recognized in earnings or other comprehensive income when they occur. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurement or assumptions that market participants would use in pricing the assets or liabilities, such as inherent risk, transfer restrictions, and credit risk. The three-level hierarchy for disclosure of fair value measurements is as follows: • Level 1. Quoted prices in active markets for identical assets or liabilities. • Level 2. Inputs other than Level 1 inputs that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or market-corroborated inputs. • Level 3. Unobservable inputs for the asset or liability. The Company’s material financial instruments consist primarily of cash and cash equivalents, short-term investments, accounts receivable, accounts payable, accrued expenses and other current liabilities. The carrying values of the Company’s cash, short-term investments, accounts receivable, accounts payable, accrued expenses and other current liabilities approximated their fair values at December 31, 2022 and 2021 due to the short period of time to maturity or repayment. As of December 31, 2022 and 2021, all cash and cash equivalents and short-term investments were considered Level 1. As of December 31, 2022 and 2021 , the Company did no t have any assets or liabilities measured on a recurring basis without observable market values that would require a high level of judgment to determine fair value (Level 3). The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. For the years ended December 31, 2022 and 2021 , there were no transfers between levels of the fair value hierarchy. Other comprehensive loss The nature of the Company’s operations does not give rise to consequential other comprehensive loss. Accounts receivable and allowance for doubtful accounts Trade receivables are recorded at net realizable value, which includes an appropriate allowance for doubtful accounts. Credit is extended to customers based on an evaluation of their financial condition, credit rating, and trade references. The Company monitors exposure to credit losses and maintains an allowance for anticipated losses based on each customer’s credit condition and payment behavior. The Company’s accounts receivable balance is net of an allowance for doubtful accounts. The allowance for doubtful accounts was not material at December 31, 2022 or December 31, 2021 . Changes in the Allowance for Doubtful Accounts were as follows: Year Ended December 31, 2022 2021 Balance, beginning of the year $ 10 $ — Provision (recovery) for bad debt ( 10 ) 10 Balance, end of the year $ — $ 10 Inventories Inventories consist of raw materials and finished goods. Raw materials include costs for the Company’s ingredients and packaging inventories. The costs of finished goods inventories include production fees from third-party manufacturers. Inventories are stated at the lower of average cost or net realizable value. The Company regularly reviews whether the net realizable value of its inventory is lower than its carrying value. Indicators that could result in inventory write downs include age of inventory, damaged inventory, slow moving products, and products at the end of their life cycles. While management believes that inventory is appropriately stated at the lower of average cost or net realizable value, judgment is involved in determining the net realizable value of inventory. Inventory valuation reserves were $ 0.4 million as of December 31, 2022 and 2021. Property and equipment, net Property and equipment are recorded at cost. Additions, replacements, and leasehold improvements are capitalized, while maintenance and repairs that do not extend the useful life of an asset are expensed as incurred. Leasehold improvements are amortized using the straight-line method over the shorter of the remaining lease term or the estimated useful life of the improvement. When assets are retired or otherwise disposed, the cost and accumulated depreciation are removed from the respective accounts and any related gain or loss is recognized. Depreciation and amortization are computed using the following estimated useful lives of the assets: Asset Years Leasehold improvements Shorter of lease term or estimated useful life Computer equipment 3 Furniture and equipment 4 - 7 Vehicles 5 Quality control equipment 2 - 7 Buildings and improvements 7 - 30 The Company periodically reviews long-lived assets for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. In order to assess recoverability, the Company compares the estimated undiscounted future pre-tax cash flows from the use of the group of assets, as defined, to the carrying amount of such assets. Measurement of an impairment loss is based on the excess of the carrying amount of the group of assets over the long-lived asset’s fair value. The Company did no t recognize any impairment charges associated with long-lived assets during the years ended December 31, 2022 and 2021 . Leases The Company leases office space and vehicles under operating leases. Right of use ("ROU") lease assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments. Both the ROU lease asset and liability are recognized as of the lease commencement date based on the present value of the lease payments over the lease term. The Company’s leases do not provide an implicit borrowing rate that can readily be determined. Therefore, the Company applies a discount rate based on the incremental borrowing rate, which is determined using the Company’s synthetic credit rating and other information available as of the lease commencement date. ROU lease assets also include any lease payments made before their contractual due dates and exclude any lease incentives. The Company’s lease agreements may include options to extend the lease term or to terminate the lease early. The Company includes options to extend or terminate leases upon determination of the ROU lease asset and liability when it is reasonably certain the Company will exercise these options. Operating lease expense attributable to lease payments is recognized on a straight-line basis over the lease term and is included in general, and administrative expense on the consolidated statements of operations and comprehensive loss. The Company has lease arrangements that include lease and non-lease components. The non-lease components in the arrangements are not significant when compared to the lease components. For all leases, the Company accounts for the lease and non-lease components as a single component. The Company evaluates ROU assets for impairment consistent under the impairment of long-lived assets policy. The Company had no material finance leases as of December 31, 2022 and 2021 . Intangible assets, net Intangible assets subject to amortization consist of customer relationships, which were acquired and are amortized over their estimated useful life of 1 5 years and computer software costs which are amortized over their estimated useful life of three years . In accordance with Accounting Standard Codification ("ASC") Topic 350, Intangibles—Goodwill and Other, intangible assets with definite lives are treated as a long-lived asset and are evaluated for impairment whenever events or changes in circumstances indicate that the asset’s carrying amount may not be recoverable. If impaired, the asset is written down to its estimated fair market value, which is generally measured by discounting future cash flows. Non-amortizable intangible assets consist of trademarks which represent the Company’s exclusive ownership of the Zevia® brand used in connection with the manufacture, marketing, and distribution of its carbonated beverages. The Company also owns several other trademarks in both the United States and in foreign countries. Intangible assets not subject to amortization are evaluated for impairment annually, or sooner if management believes such assets may be impaired. An impairment loss is recognized if the asset’s carrying amount exceeds its estimated fair market value. For the years ended December 31, 2022 and 2021 , no impairment losses were recorded. Certain external and internal computer software costs acquired for internal use are capitalized. Training costs and maintenance are expensed as incurred, while upgrades and enhancements are capitalized if it is probable that such expenditures will result in additional functionality. Capitalized costs are included within intangible assets, net. Debt issuance cost Costs incurred in connection with securing a revolving line of credit agreement are capitalized. These costs are amortized over the term of the credit agreement. Debt issuance costs are included in Other non-current assets in the accompanying consolidated balance sheets. Net debt issuance costs totaled $ 0.3 million and $ 0 million as of December 31, 2022 and 2021 , respectively. Customer incentives and allowances The Company offers its customers sales incentives that are designed to support the distribution of its products to consumers. These incentives and discounts include cash discounts, price allowances, volume-based rebates, product placement fees and certain other financial support for items such as trade promotions, displays, new products, consumer incentives and advertising assistance. These amounts are deducted from gross sales and are included under Net sales in the accompanying consolidated statements of operations and comprehensive loss. The Company maintains an allowance representing the estimated cost of certain customer incentives incurred but not yet realized as of the end of each respective year, which is recorded as an offset against customer accounts receivable, and is included under Accounts receivable, net in the accompanying consolidated balance sheets. The customer incentives and allowances were $ 5.6 million and $ 3.5 million as of December 31, 2022 and 2021 , respectively. Revenue recognition The Company recognizes revenue when performance obligations under the terms of a contract with the customer are satisfied. Product sales occur once control is transferred either upon shipment or delivery to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods, net of accruals for customer incentives and allowances. The amount of consideration the Company receives and revenue the Company recognizes varies with changes in customer incentives the Company offers to its customers. Customer incentives and allowances are estimated based on agreed upon terms as well as historical trends and current economic and market conditions, while cash discounts are based on trade terms and require management judgment with respect to estimating customer participation and performance levels. Differences between such estimated expenses and actual expenses for promotional and other allowance costs have historically been insignificant and are recognized in earnings in the period such differences are determined. The Company accounts for costs associated with shipping and handling activities that occur after the transfer of control as a fulfillment activity, instead of a separate performance obligation. The Company excludes from the transaction price those amounts which relate to sales and other taxes that are assessed by governmental authorities and that are imposed and concurrent with a specific revenue-producing transaction and collected by the Company from a customer. The Company’s general payment terms are short-term in duration. The Company does not have significant financing components or payment terms. Cost of goods sold Cost of goods sold consists of all costs to acquire and manufacture the Company’s products including the cost of the various ingredients, packaging, in-bound freight and logistics, and third-party production fees—which are typically incurred at a flat rate per case produced—and all other costs incurred to bring the product to salable condition. The Company’s cost of goods sold is generally subject to price fluctuations in the marketplace for aluminum, logistics costs such as fuel, freight and warehousing for raw materials, bottling tolling fees, as well as shifting product mix. The Company has elected to classify shipping and handling costs for salable product outside of cost of goods sold, in selling and marketing expenses in the accompanying consolidated statements of operations and comprehensive loss. Such costs amounted to approximately $ 15.4 million and $ 13.2 million for the years ended December 31, 2022 and 2021 , respectively. Selling and marketing expenses Selling and marketing expenses in the accompanying consolidated statements of operations and comprehensive loss include warehousing and distribution costs, shipping and handling costs, advertising, and marketing costs, which generally are expensed as incurred. Warehousing and distribution costs include storage, transfer, repacking and handling fees, and out-bound freight and delivery charges. The Company expenses sales and marketing costs as incurred. Advertising and marketing expenses represent costs associated with the promotion of the Zevia® brand and products as outlined in ASC Topic 730-25, Other Expenses – Advertising Costs , such as those for digital and other forms of advertising. Advertising and marketing expenses amounted to approximately $ 11.1 million and $ 12.6 million for the years ended December 31, 2022 and 2021 , respectively. General and administrative expenses General and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss include personnel-related expenses, including salaries, bonuses, and benefits, technology expenses, professional fees, facility costs, including insurance, utilities and rent relating to our headquarters, and overhead costs. These costs are expensed as incurred. Equity-based compensation expense The Company records equity-based compensation expense for employees and nonemployees under the provisions of ASC Topic 718, Compensation—Stock compensation (“ASC 718”), using a Black-Scholes-Merton option pricing model to calculate the fair value of stock options by date granted. The determination of the grant date fair value of stock options issued is affected by a number of variables, including the fair value of the Company’s common stock, the expected common stock price volatility over the expected life of the options, the expected term of the stock option, risk-free interest rates, and the expected dividend yield of the Company’s common stock. The Company derives its volatility from the average historical volatilities of several peer public companies over a period equivalent to the expected term of the awards. The Company estimates the expected term based on the simplified method prescribed by guidance provided by the Securities and Exchange Commission. This decision was based on the lack of relevant historical data due to the Company’s limited experience for the Company’s common stock. The risk-free interest rate is based on the United States Treasury yield curve in effect at the time of grant. Expected dividend yield is 0.0 % as the Company has not paid and does not anticipate paying dividends on its common stock. The fair value of stock options is recognized as expense on a straight-line basis over the requisite service period, which is typically four years. Equity-based compensation cost for restricted stock awards is measured based on the fair market value of the Company’s common stock at the date of grant and is recognized as expense over the requisite service period, which is the vesting period on a straight-line basis. Forfeitures are recognized as incurred. Depreciation and Amortization Depreciation is primarily related to building and related improvements, computer equipment, quality control and marketing equipment, and leasehold improvements. Intangible assets subject to amortization consist of customer relationships and software applications. Non-amortizable intangible assets consist of trademarks, which represent the Company’s exclusive ownership of the Zevia® brand used in connection with the manufacturing, marketing, and distribution of its beverages. The Company also owns several other trademarks in both the U.S. and in foreign countries. Foreign currency transactions The functional currency of the Company is the U.S. Dollar. The Company sells and distributes its products to Canadian customers, who are invoiced and remit payment in Canadian dollars. All Canadian dollar transactions are translated into United States dollars using period-end rates of exchange for assets and liabilities, and average rates of exchange for the period for net sales and expenses. Foreign currency transaction (losses) gains for the years ended December 31, 2022 and 2021 amounted to approximately $ 0.2 million and $ 0.0 million, respectively, and are included under other income (expense), net in the accompanying consolidated statements of operations and comprehensive loss. Income Taxes The Company is the managing member of Zevia LLC and, as a result, consolidates the financial results of Zevia LLC in the consolidated financial statements. Zevia LLC is a pass-through entity for U.S. federal and most applicable state and local income tax purposes. As an entity classified as a partnership for tax purposes, Zevia LLC is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Zevia LLC is passed through to its members, including the Company. The Company is taxed as a corporation and pays corporate federal, state and local taxes with respect to income allocated from Zevia LLC based on the Company's economic interest in Zevia LLC, which was 68.7 % and 53.4 % as of December 31, 2022 and 2021, respectively. Subsequent changes in economic ownership in Zevia LLC of the Company can occur as Zevia LLC holders may convert their shares of Class B common stock into an equivalent number of shares of Class A common stock with income (loss) allocated to the Company based on the economic interest applicable during each reporting period. The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities (“DTAs” and “DTLs”) for the expected future tax consequences of events that have been included in the financial statements. Under this method, we determine DTAs and DTLs on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on DTAs and DTLs is recognized in income in the period that includes the enactment date. We recognize DTAs to the extent that we believe that these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations. If we determine that we would be able to realize our DTAs in the future in excess of their net recorded amount, we would make an adjustment to the DTA valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740, Income Taxes on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. We recognize both accrued interest and penalties, when appropriate, in provision for income taxes in the accompanying consolidated statements of operations and comprehensive loss. Recent accounting pronouncements The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act ("JOBS Act"). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, the consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. Recently Issued Accounting Pronouncements – Recently Adopted In April 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2021-04, which included Topic 260, Earnings Per Share and Topic 718, Compensation - Stock Compensation . This guidance clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options due to a lack of explicit guidance in the FASB Codification. This ASU is effective for all entities for fiscal years beginning after December 15, 2021. Early adoption is permitted. The Company adopted ASU 2021-04 as of January 1, 2022. The adoption of ASU 2021-04 did not have a significant impact on the Company's financial statements as the Company does not have freestanding equity-classified written call options. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes . This ASU improves areas of US GAAP and reduces cost and complexity while maintaining usefulness. The main provisions remove certain exceptions, including the exception to the general methodology for calculating income taxes in an interim period when a year-to-date loss exceeds the anticipated loss for the year. In addition, the amendments simplify income tax accounting in the areas such as income based franchise taxes, eliminating the requirements to allocate consolidated current and deferred tax expense in certain instances and a requirement that an entity reflects the effect of enacted changes in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. This ASU is effective for private companies for annual reporting periods beginning after December 15, 2021, and interim periods within annual periods beginning after December 15, 2022. The Company adopted ASU 2019-12 as of January 1, 2022. The adoption of ASU 2019-12 did not have a significant impact on the Company’s financial statements. In August 2020, the FASB issued ASU No. 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU reduces the number of accounting models for convertible debt instruments and convertible preferred stock, as well as amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related earnings per share guidance and requires the application of the if-converted method for calculating diluted earnings per share, with the treasury stock method no longer permissible. The ASU is applicable to the Company for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. Adoption is |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | 3. REVENUES Disaggregation of Revenue The Company's products are distributed and sold principally across the U.S. and Canada through a diverse network of major retailers, including: grocery stores, natural products stores, specialty outlets, and warehouse clubs; and through online/e-commerce channels. The following table disaggregates the Company’s sales by channel: Year Ended December 31, (in thousands) 2022 2021 Retail sales $ 145,041 $ 119,884 Online/e-commerce $ 18,140 18,288 Net sales $ 163,181 $ 138,172 The following table disaggregates the Company’s sales by geographic location of the respective customers: Year Ended December 31, (in thousands) 2022 2021 United States $ 145,180 $ 125,378 Canada 18,001 12,794 Net sales $ 163,181 $ 138,172 Contract liabilities The Company did no t have any material unsatisfied performance obligations as of December 31, 2022 and December 31, 2021 , respectively. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventories | 4. INVENTORIES Inventories consist of the following as of: (in thousands) December 31, 2022 December 31, 2021 Raw materials $ 7,527 $ 10,193 Finished goods 20,049 21,308 Inventories $ 27,576 $ 31,501 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | 5. PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following as of: (in thousands) December 31, 2022 December 31, 2021 Land $ 336 $ 336 Leasehold improvements 463 463 Computer equipment and software 796 (1) 813 (1) Furniture and equipment 544 521 Vehicles 197 38 Quality control and marketing equipment 1,635 532 Buildings and improvements 1,610 1,443 Assets not yet placed in service 1,128 456 6,709 4,602 Less accumulated depreciation ( 2,068 ) ( 1,433 ) Property and equipment, net $ 4,641 $ 3,169 (1) During the year ended December 31, 2022, the Company reclassified computer software costs from property and equipment, net, to intangible assets, net. Refer to Note 2 - Summary of Significant Accounting Policies f or amounts reclassified. During the year ended December 31, 2021, the Company purchased a warehouse facility in Evansville, Indiana for a total purchase price of $ 1.7 million. For the year ended December 31, 2022 and 2021, depreciation expense, including the amortization of leasehold improvements, amounted to approximately $ 0.7 million and $ 0.6 million, respectively. These amounts are included under depreciation and amortization in the accompanying consolidated statements of operations and comprehensive loss. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets, Net | 6. INTANGIBLE ASSETS, NET The following table provides information pertaining to the Company’s intangible assets as of: December 31, 2022 (in thousands) Weighted-Average Remaining Useful Life Gross Carrying Amount Accumulated Amortization Intangible Assets, Net Software 2.0 $ 2,277 $ ( 1,429 ) $ 848 Customer relationships 2.7 3,007 ( 2,470 ) 537 5,284 ( 3,899 ) 1,385 Trademarks N/A 3,000 — 3,000 Intangible assets, net $ 8,284 $ ( 3,899 ) $ 4,385 December 31, 2021 (in thousands) Weighted-Average Remaining Useful Life Gross Carrying Amount Accumulated Amortization Intangible Assets, Net Software 1.3 $ 1,440 $ ( 945 ) $ 495 Customer relationships 3.7 3,007 ( 2,269 ) 738 4,447 ( 3,214 ) 1,233 Trademarks N/A 3,000 — 3,000 Intangible assets, net $ 7,447 $ ( 3,214 ) $ 4,233 For the years ended December 31, 2022 and 2021 , total amortization expense amounted to $ 0.7 million and $ 0.4 million, respectively, including $ 0.4 million and $ 0.2 million, respectively, of amortization expense related to software. No impairment losses have been recorded on any of the Company’s intangible assets for the years ended December 31, 2022 and 2021. Amortization expense for intangible assets with definite lives is expected to be as follows: (in thousands) 2023 $ 632 2024 563 2025 190 Expected amortization expense for intangible assets with definite lives $ 1,385 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Debt | 7. DEBT ABL Credit Facility On February 22, 2022, Zevia LLC (the "Borrower") obtained a revolving credit facility (the “Secured Revolving Line of Credit") by entering into a Loan and Security Agreement with Bank of America, N.A. (the "Loan and Security Agreement"). The Borrower may draw funds under the Secured Revolving Line of Credit up to an amount not to exceed the lesser of (i) a $ 20 million revolving commitment and (ii) a borrowing base which is comprised of inventory and receivables. Up to $ 2 million of the Secured Revolving Line of Credit may be used for letter of credit issuances and the Borrower has the option to increase the commitment under the Secured Revolving Line of Credit by up to $ 10 million, subject to certain conditions. The Secured Revolving Line of Credit matures on February 22, 2027. There have been no amounts drawn under the Secured Revolving Line of Credit. The Secured Revolving Line of Credit is secured by a first priority security interest in substantially all of the Company's assets. Loans under the Secured Revolving Line of Credit bear interest based on either, at the Borrower’s option, the Bloomberg Short-Term Bank Yield Index rate plus an applicable margin between 1.50 % to 2.00 % or the Base Rate (customarily defined) plus an applicable margin between 0.50 % to 1.00 % with margin, in each case, determined by the average daily availability under the Secured Revolving Line of Credit. The Borrower is required under the Secured Revolving Line of Credit to comply with certain covenants, including, among others, by maintaining Liquidity (as defined therein) of $ 7 million at all times until December 31, 2023. Thereafter, the Borrower must satisfy a financial covenant requiring a minimum fixed charge coverage ratio of 1.00 to 1.00 as of the last day of any fiscal quarter following the occurrence of certain events of default that are continuing or any day on which availability under the Secured Revolving Line of Credit is less than the greater of $ 3 million and 17.5 % of the borrowing base, and must again satisfy such financial covenant as of the last day of each fiscal quarter thereafter until such time as there are no events of default and availability has been above such threshold for 30 consecutive days. As of December 31, 2022, the Company was in compliance with its liquidity covenant. Credit Facility In 2019, Zevia LLC entered into a loan agreement providing for a $ 9.0 million revolving line of credit (the “Credit Facility”) with Stonegate Asset Company II, LLC (“Stonegate”), with a maturity date in April 2022 . Borrowings under the revolving line were secured by accounts receivable and inventory. In June 2020, Zevia amended the Credit Facility and increased it to $ 12.0 million. As of December 31, 2021 , the revolving line interest rate was 7.5 % annual percentage rate and there was no outstanding balance. On June 1, 2021, Zevia extended the Credit Facility through April 2023 and there were no other modifications made to the terms and conditions. In July 2021 and subsequent to the IPO, Zevia terminated the Credit Facility. Early-termination fees were not material and were included in interest expense within other expenses, net in the accompanying consolidated statements of operations and comprehensive loss. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | 8. LEASES The Company leases office space and vehicles. The leases have remaining lease terms of one to 15 months. On March 25, 2022, the Company entered into an amendment to the lease for its corporate headquarters offices to extend the term through December 31, 2023, and to expand the total square footage from 17,923 square feet to 20,185 square feet commencing on May 1, 2022. In January 2023, the Company extended the lease term through December 31, 2026. The Company’s recognized lease costs include: Year Ended December 31, (in thousands) 2022 2021 Income Statement Operating lease cost (1) $ 705 $ 605 (1) Operating lease cost is recorded within general and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss. Year Ended December 31, 2022 2021 Weighted-average remaining lease term (months) 12.0 4.6 Weighted-average discount rate 7.6 % 7.6 % The Company’s variable lease costs and short-term lease costs were not material. The Company is obligated under various non-cancellable lease agreements providing for office space and vehicles that expire at various dates through 2023. Maturities of lease payments under non-cancellable leases were as follows: (in thousands) December 31, 2022 2023 $ 745 Total lease payments 745 Less Imputed Interest ( 30 ) Present value of lease liabilities $ 715 |
Commitments And Contingencies
Commitments And Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments And Contingencies | 9. COMMITMENTS AND CONTINGENCIES Purchase commitments As of December 31, 2022, the Company does not have any material agreements with suppliers for the purchase of raw material with minimum purchase quantities. Legal proceedings The Company is involved from time to time in various claims, proceedings, and litigation. The Company establishes reserves for specific legal proceedings when it determines that the likelihood of an unfavorable outcome is probable, and the amount of loss can be reasonably estimated. The Company has not identified any material legal matters where it believes an unfavorable material outcome is reasonably possible and/or for which an estimate of possible losses can be made. Management does not believe that the resolution of these matters would have a material impact on the consolidated financial statements. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | 10. EMPLOYEE BENEFIT PLAN Employees of the Company may participate in the Zevia LLC 401(k) Plan (the “Plan”), a defined contribution plan which qualifies under Section 401(k) of the Internal Revenue Code. Participating employees may contribute from 1 % to 90 % of their pre-tax earnings, up to the statutory limit. Effective January 1, 2020, the Company began offering matching contributions to the Plan of up to 4 % of employee pre-tax earnings. For the years ended December 31, 2022 and 2021, the Company incurred contribution expense of $ 0.5 million and $ 0.4 million, respectively. |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Balance Sheet Components | 11. BALANCE SHEET COMPONENTS Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consisted of the following as of: (in thousands) December 31, 2022 December 31, 2021 Accrued employee compensation benefits $ 3,409 $ 3,032 Accrued direct selling costs 1,593 1,011 Accrued customer paid bottle deposits 1,253 774 Accrued other 2,153 1,888 Total $ 8,408 $ 6,705 |
Equity-Based Compensation
Equity-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Employee Benefit Plan | 12. EQUITY-BASED COMPENSATION In connection with the IPO, the Company assumed all outstanding equity awards of Zevia LLC on a one-to-two basis and assumed all equity incentive plans and related award agreements from Zevia LLC. In July 2021, prior to the IPO, the Company adopted the Zevia PBC 2021 Equity Incentive Plan (the “2021 Plan") under which the Company may grant options, stock appreciation rights, restricted stock units ("RSUs"), restricted stock awards, other equity-based awards and incentive bonuses to employees, officers, non-employee directors and other service providers of the Company and its affiliates. The number of shares available for issuance under the 2021 Plan is increased on January 1 of each year beginning in 2022 and ending with a final increase in 2031 in an amount equal to the lesser of: (i) 5 % of the total number of shares of Class A common stock outstanding on the preceding December 31, and (ii) a smaller number of shares determined by the Company's Board of Directors. In October and November 2021, the Company amended outstanding RSU awards and outstanding stock options held by certain employees, in each case, to provide for accelerated vesting upon the holder’s retirement on or after January 17, 2022. For this purpose, “retirement” generally includes a resignation after the holder has reached 50 years of age with at least 10 years of service to the Company, so long as the holder provides advance notice of such retirement. As of December 31, 2022, the 2021 Plan provides for future grants and/or issuances of up to approximately 2.5 million shares of our common stock. Equity-based awards under our employee compensation plans are made with newly issued shares reserved for this purpose. Stock Options The Company uses a Black-Scholes valuation model to measure stock option expense as of each respective grant date. Generally, stock option grants vest ratably over four years, have a ten-year term, and have an exercise price equal to the fair market value as of the grant date. The fair value of stock options is amortized to expense over the vesting period. The fair value of stock option awards granted during the period was determined on the grant date using the Black-Scholes valuation model based on the following weighted-average assumptions: Year Ended December 31, 2022 2021 Stock price $ 3.40 $ 14.00 Exercise Price 3.93 14.00 Expected term (years) (1) 6.25 6.06 Expected volatility (2) 62.7 % 47.5 % Risk-Free interest rate (3) 2.7 % 0.9 % Dividend yield (4) 0.0 % 0.0 % (1) Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method. (2) Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term. (3) The risk-free rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term. (4) We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future. The weighted average grant date fair values for stock options granted for the years ended December 31, 2022 and 2021 was $ 1.97 and $ 6.39 , respectively. The following is a summary of stock option activity for the year ended December 31, 2022: Shares Weighted average exercise price Weighted average remaining life Intrinsic value (in thousands) Outstanding Balance as of January 1, 2022 1,409,693 $ 2.30 Granted 1,721,320 $ 3.93 Exercised ( 246,415 ) $ 0.50 Forfeited and expired ( 114,844 ) $ 5.14 Balance as of December 31, 2022 2,769,754 $ 3.36 8.0 $ 4,455 Exercisable at the end of the period 945,790 $ 1.40 5.3 $ 3,273 Vested and expected to vest 2,769,754 $ 3.36 8.0 $ 4,455 The total intrinsic values of options exercised during the year ended December 31, 2022 was $ 0.9 million. As of December 31, 2022, total unrecognized compensation expense related to unvested stock options was $ 3.4 million, which is expected to be recognized over a weighted-average period of 3.2 years. Restricted Phantom Units and Restricted Stock Units In July 2021, the Company’s Board of Directors approved an amendment to 2,422,644 restricted phantom units (the “Restricted Phantom Units”) previously granted by Zevia LLC (the “Phantom Unit Amendment”). The Phantom Unit Amendment changed the settlement feature of all outstanding Restricted Phantom Units so that following vesting, each award Restricted Phantom Units would be settled in shares of Class A common stock having a fair market value equal to (i) the number of Restricted Phantom Units subject to such award, multiplied by (ii) the difference between the fair market value of a share of Class A common stock and the grant date price per Restricted Phantom Unit. All other terms related to the Restricted Phantom Units remained unchanged. As a result of the Phantom Unit Amendment, the estimated fair value of the modified awards was $ 33.9 million and was recognized as an expense over the vesting period through January 2022 subsequent to the performance condition being met. In March 2021, the Company's Board of Directors also approved an amendment to the RSUs granted in August 2020 (“the RSU Amendment”). The RSU Amendment changes the vesting of such RSUs to occur as follows: (i) in the event of a change of control, the RSUs shall vest effective as of such change of control or (ii) in the event of an IPO, the RSUs shall vest in equal monthly installments over a 36-month period following the termination of any lockup period and shall be subject to the participant’s continued employment through such vesting date. Additionally, settlement shall occur within 30 days following the vesting of the RSUs and the participant shall be entitled to receive one share of Class A common stock for each vested RSU. All other terms remained unchanged. As a result of the RSU Amendment, the estimated fair value of the modified awards was $ 48.9 million and are being recognized as expense over the vesting period subsequent to the performance condition being met. As of December 31, 2022, the remaining service period of the awards is 25 months . In November 2021, the Company's Board of Directors approved an amendment to its equity-based compensation plans for certain employees to allow immediate vesting upon retirement of all outstanding RSUs and stock options, and to extend the exercisability of outstanding stock options up to five years after retirement, if they meet certain conditions, including length of service and age, and they provide advance notice to the Board of Directors. During the year ended December 31, 2022 , three employees retired from the Company and all outstanding awards and related stock compensation expense of $ 8.2 million was accelerated through their retirement date. The following is a summary of RSU activity for the year ended December 31, 2022: Shares Weighted average grant date fair value Aggregate Intrinsic Value (in thousands) Balance unvested shares at January 1, 2022 7,981,444 $ 5.33 Granted 1,121,740 $ 3.41 Vested ( 6,445,278 ) * $ 5.58 Forfeited ( 97,316 ) $ 4.81 Balance unvested at December 31, 2022 2,560,590 $ 3.90 10,473 Expected to vest at December 31, 2022 2,560,590 $ 3.90 10,473 *Shares vested includes 1,345,800 of RSUs which vested but are subject to a deferred settlement provision over the next three years and therefore have not been released. As of December 31, 2022, total unrecognized compensation expense related to unvested RSUs was $ 9.8 million, which is expected to be recognized over a weighted-average period of 2.3 years. |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Units | 12 Months Ended |
Dec. 31, 2022 | |
Redeemable Convertible Preferred Units [Abstract] | |
Redeemable Convertible Preferred Units | 13. REDEEMABLE CONVERTIBLE PREFERRED UNITS Prior to the IPO and the Reorganization Transactions, Zevia LLC had various classes of redeemable convertible preferred units ("preferred units") outstanding that were issued at various times since inception. In connection with the IPO and the Reorganization Transactions, all outstanding preferred units were reclassified into a single class of common units and each common unit outstanding after giving effect thereto was reclassified as two Class B units on a one-to-two basis. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | 14. SEGMENT REPORTING The Company has one operating and reporting segment which operates as a product portfolio with a single business platform. In reaching this conclusion, management considered the definition of the Chief Operating Decision Maker (“CODM”); how the business is defined by the CODM; the nature of the information provided to the CODM and how that information is used to make operating decisions; and how resources and performance are accessed. The Company’s CODM is the Chief Executive Officer. The results of the operations are provided to and analyzed by the CODM at the Company's level and accordingly, key resource decisions and assessment of performance are performed at the Company's level. The Company has a common management team across all product lines and does not manage these products as individual businesses and as a result, cash flows are not distinct. |
Major Customers, Accounts Recei
Major Customers, Accounts Receivable And Vendor Concentration | 12 Months Ended |
Dec. 31, 2022 | |
Risks and Uncertainties [Abstract] | |
Major Customers, Accounts Receivable And Vendor Concentration | 15. MAJOR CUSTOMERS, ACCOUNTS RECEIVABLE AND VENDOR CONCENTRATION The table below represents the Company’s major customers that accounted for more than 10 % of total net sales for the periods: Year Ended December 31, 2022 2021 Customer A 15 % 17 % Customer B * 16 % Customer C * 11 % Customer D * 11 % The table below represents the Company’s customers that accounted for more than 10 % of total accounts receivable, net as of: December 31, 2022 December 31, 2021 Customer B * 13 % Customer D 10 % 15 % Customer E 17 % 11 % Customer F * 12 % Customer H 12 % * The table below represents raw material vendors that accounted for more than 10 % of all raw material purchases for the periods: Year Ended December 31, 2022 2021 Vendor A 27 % 28 % Vendor B 18 % 22 % Vendor C 13 % 13 % * Less than 10 % of total net sales, accounts receivable, net or raw material purchases. |
Loss Per Share
Loss Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Loss Per Share | 16. LOSS PER SHARE Basic earnings (loss) per share of Class A common stock is computed by dividing net loss attributable to the Company for the period by the weighted-average number of shares of Class A common stock outstanding during the same period. Diluted earnings per share of Class A common stock is computed by dividing net loss attributable to the Company by the weighted-average number of shares of Class A common stock outstanding adjusted to give effect to potentially dilutive securities. There were no shares of Class A or Class B common stock outstanding prior to July 22, 2021, therefore no earnings per share information has been presented for any period prior to that date. Shares of the Company’s Class B common stock do not share in the earnings or losses attributable to Zevia PBC and are therefore not participating securities. As such, separate presentation of basic and diluted earnings per share of Class B common stock under the two-class method has not been presented. Shares of the Company’s Class B common stock are, however, considered potentially dilutive shares of Class A common stock because shares of Class B common stock, together with the related Zevia LLC Class B Common Units, are exchangeable into shares of Class A common stock on a one-for-one basis. Prior to the IPO, the Zevia LLC membership structure included various classes of Preferred Units and Common units. The Company analyzed the calculation of earnings per unit for periods prior to the IPO and determined that it resulted in values that would not be meaningful to the users of these consolidated financial statements. Therefore, earnings per share information has not been presented for any period prior to the IPO. The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock: Year Ended December 31, 2022 2021 (in thousands, except for share and per share amounts) Net loss per share: Numerator: Net loss and comprehensive loss $ ( 47,647 ) $ ( 87,667 ) Less: net loss attributable to Zevia LLC prior to the Reorganization Transactions — 1,913 Less: net loss attributable to non-controlling interests 13,790 39,768 Add: adjustment to reallocate net loss to controlling interest ( 1,298 ) (1) — Net loss to Zevia PBC $ ( 35,155 ) $ ( 45,986 ) Denominator: Weighted-average shares of Class A common stock outstanding – basic 41,739,061 34,450,409 Add: weighted average shares of vested and unreleased RSUs 1,730,322 (2) — Weighted-average basic and diluted shares 43,469,383 34,450,409 Loss per share of Class A common stock – basic $ ( 0.81 ) $ ( 1.33 ) (3) Loss per share of Class A common stock – diluted $ ( 0.81 ) $ ( 1.33 ) (3) (1) The numerator for the basic and diluted loss per share is adjusted for additional losses being attributed to controlling interest as a result of the impacts of vested but unreleased RSUs being included in the denominator of the basic and diluted loss per share. (2) The denominator for basic and diluted loss per share includes vested and unreleased RSUs as there are no conditions that would prevent these RSUs from being issued in the future as shares of Class A common stock except for the mere passage of time. (3) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the Reorganization Transactions and IPO. Zevia LLC Class B Common Units, stock options and restricted stock units were evaluated under the treasury stock method for potential dilutive effects and were determined to be anti-dilutive. The following weighted average outstanding shares were excluded from the computation of diluted net loss per share available to common stockholders: Year Ended December 31, 2022 2021 Zevia LLC Class B Common Units exchangeable to shares of Class A common Stock 26,023,476 30,113,152 Stock options 2,239,025 1,483,824 Restricted stock units 3,473,655 7,981,444 |
Income Taxes And Tax Receivable
Income Taxes And Tax Receivable Agreement | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes And Tax Receivable Agreement | 17. INCOME TAXES AND TAX RECEIVABLE AGREEMENT Income Taxes The Company is the managing member of Zevia LLC and as a result, consolidates the financial results of Zevia LLC in the consolidated financial statements of Zevia PBC. Zevia LLC is a pass-through entity for U.S. federal and most applicable state and local income tax purposes following the Reorganization Transactions effected in connection with the IPO. As an entity classified as a partnership for tax purposes, Zevia LLC is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Zevia LLC is passed through to its members, including the Company. The Company is taxed as a C corporation and pays corporate federal, state and local taxes with respect to income allocated from Zevia LLC based on Zevia PBC's economic interest in Zevia LLC, which was 68.7 % and 53.4 %, as of December 31, 2022 and 2021, respectively. Income tax expense consists of the following: Year Ended December 31, 2022 2021 Current Federal $ — $ — State 65 34 Total 65 34 Deferred Federal — — State — — Total — — Provision for income taxes $ 65 $ 34 A reconciliation between the Company’s effective tax rate and the applicable U.S. federal statutory income tax rate is summarized as follows: Year Ended December 31, 2022 2021 Tax computed at federal statutory rate 21.0 % 21.0 % State tax, net of federal tax benefit 0.8 % 1.7 % Permanent items and other ( 0.8 )% 0.0 % Non-controlling interests ( 5.8 )% ( 10.0 )% Equity-based compensation ( 9.2 )% ( 3.7 )% Valuation allowance ( 6.1 )% ( 9.0 )% Effective Tax Rate ( 0.1 )% 0.0 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes. The components that comprise the Company's net deferred tax assets consist of the following: Year Ended December 31, 2022 2021 Deferred tax assets Investment in Zevia LLC $ 53,427 $ 47,955 Net operating loss carryforwards 15,970 4,144 Equity-based compensation 3,161 6,840 Other temporary differences 104 1 Total deferred tax assets 72,662 58,940 Valuation allowance for deferred tax assets ( 72,662 ) ( 58,940 ) Net deferred tax assets $ — $ — The Company records a valuation allowance to reduce deferred tax assets to the amount the Company believes is more likely than not to be realized. The determination of recording or releasing tax valuation allowances is made, in part, pursuant to an assessment performed by management regarding the likelihood that the Company will generate sufficient future taxable income against which benefits of the deferred tax assets may or may not be realized. This assessment requires management to exercise significant judgment and make estimates with respect to the Company’s ability to generate revenue, gross profits, operating income and taxable income in future periods. The Company has recorded a full valuation allowance of $ 72.7 and $ 58.9 million as of December 31, 2022 and 2021, respectively, as it cannot conclude that it is more likely than not that the deferred tax assets will be realized primarily due to the generation of pre-tax book losses from its inception. The following table summarizes the activity related to the Company's valuation allowance: Year Ended December 31, 2022 2021 Balance, beginning of the year $ 58,940 $ — Increases related to current year positions 13,722 58,940 Balance, end of the year $ 72,662 $ 58,940 As of December 31, 2022, the Company has federal and state net operating loss carryforwards of $ 66.2 million and $ 36.8 million, respectively. The federal net operating loss can be carried forward indefinitely but are limited to 80 % utilization against future taxable income each year in accordance with the Tax Cuts and Jobs Act of 2017. The state net operating loss carryforwards will begin to expire in 2031 unless previously utilized by the Company. The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. While the Company believes that it has appropriate support for the positions taken on its tax returns, the Company regularly assesses the potential outcome of examinations by tax authorities in determining the adequacy of its provision for income taxes. As of December 31, 2022 , the Company has no uncertain tax positions and does no t expect a significant change in unrecognized tax benefits during the next 12 months. The Company is subject to taxation in the United States and various states. The Company is not currently under examination by any taxing authorities. Due to the carryover of tax attributes, the statute of limitations is currently open for tax years since inception for Zevia PBC. On March 27, 2020, the United States enacted the CARES Act. The Cares Act is an emergency economic stimulus package that includes spending and tax breaks to strengthen the United States economy and fund a nationwide effort to curtail the effect of COVID-19. The CARES Act provides sweeping tax changes in response to the COVID-19 pandemic, some of the more significant provisions are amending certain provisions of the previously enacted Tax Cuts and Jobs Act related to depreciable property and net operating losses, deferral of payroll taxes, and the Paycheck Protection program. At December 31, 2022 , the Company has no t booked any income tax provision or benefit for the impact for the CARES Act due to its recent incorporation and the pass-through treatment of Zevia, LLC. On February 9, 2022, California enacted SB 113, which, among other changes, ends the temporary limitations on the utilization of net operating loss ("NOL") carryforwards and certain credits. Under previously enacted provisions, NOL carryforward deductions were suspended for tax years 2020-2022 for taxpayers with over $ 1 million of California taxable income. The newly enacted legislation removes this limitation on NOL utilization for the 2022 tax year and removes the $ 5 million cap on the usage of corporate income tax credits. There was no material impact from the provisions of SB 113 in 2022. On August 16, 2022, the United States enacted the Inflation Reduction Act of 2022 (“IRA”), which includes a 15 % book-income alternative minimum tax on corporations with average applicable financial statement income over $ 1 billion for any three year period ending with 2022 or later and a 1 % excise tax on the fair market value of stock that is repurchased by publicly-traded U.S. corporations or their specified affiliates. The alternative minimum tax and the excise tax are effective in taxable years beginning after December 31, 2022. The IRA also includes provisions intended to mitigate climate change by, among others, providing tax credit incentives for reductions in greenhouse gas emissions. The Company does not believe this legislation will have a material impact on our consolidated financial statements. Tax Receivable Agreement The Company expects to obtain an increase in its share of tax basis in the net assets of Zevia, LLC when Class B units are exchanged by the holders of Class B units for shares of Class A common stock of the Company and upon certain qualifying transactions. Each change in outstanding shares of Class A common stock of the Company results in a corresponding change in the Company's ownership of Class A units of Zevia, LLC. The Company intends to treat any exchanges of Class B units as direct purchases of LLC interests for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that Zevia PBC would otherwise pay in the future to various taxing authorities. They may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. In connection with the IPO, the Company entered into a Tax Receivable Agreement ("TRA") with continuing members of Zevia LLC and the Direct Zevia Stockholders. In the event that such parties exchange any or all of their Class B units for Class A common stock, the TRA requires the Company to make payments to such holders for 85 % of the tax benefits realized, or in some cases deemed to be realized, by the Company by such exchange as a result of (i) certain favorable tax attributes acquired from the Blocker Companies in the Mergers (including net operating losses and the Blocker Companies’ allocable share of existing tax basis), (ii) increases in tax basis resulting from Zevia PBC's acquisition of continuing member's Zevia LLC units in connection with the IPO and in future exchanges and, (iii) tax basis increases attributable to payments made under the TRA (including tax benefits related to imputed interest). The annual tax benefits are computed by calculating the income taxes due, including such tax benefits, and the income taxes due without such benefits. The Company expects to benefit from the remaining 15% of any tax benefits that it may actually realize. The TRA payments are not conditioned upon any continued ownership interest in Zevia, LLC or the Company. To the extent that the Company is unable to timely make payments under the TRA for any reason, such payments generally will be deferred and will accrue interest until paid. The timing and amount of aggregate payments due under the TRA may vary based on a number of factors, including the amount and timing of the taxable income the Company generates each year and the tax rate then applicable. The Company calculates the liability under the TRA using a complex TRA model, which includes an assumption related to the fair market value of assets. Payments are generally due under the TRA within a specified period of time following the filing of the Company’s tax return for the taxable year with respect to which the payment obligation arises, although interest on such payments will begin to accrue at a rate of the SOFR plus 300 basis points from the due date (without extensions) of such tax return. The TRA provides that if (i) certain mergers, asset sales, other forms of business combinations, or other changes of control were to occur; (ii) there is a material uncured breach of any obligations under the TRA; or (iii) the Company elects an early termination of the TRA, then the TRA will terminate and the Company's obligations, or the Company's successor’s obligations, under the TRA will accelerate and become due and payable, based on certain assumptions, including an assumption that the Company would have sufficient taxable income to fully utilize all potential future tax benefits that are subject to the TRA and that any Class B units that have not been exchanged are deemed exchanged for the fair market value of the Company's Class A common stock at the time of termination. As of December 31, 2022, the Company has concluded, based on applicable accounting standards, that it was more likely than not that its deferred tax assets subject to the TRA would not be realized; therefore, the Company has not recorded a liability related to the tax savings it may realize from utilization of such deferred tax assets. The TRA liability that would be recognized if the associated tax benefits were determined to be fully realizable totaled $ 55.8 million and $ 45.6 million at December 31, 2022 and 2021, respectively. The increase in the TRA liability is primarily related to Class B to Class A exchanges during the year ended December 31, 2022. If utilization of the deferred tax asset subject to the TRA becomes more likely than not in the future, the Company will record a liability related to the TRA which will be recognized as expense within its consolidated statements of operations. |
Unaudited Quarterly Information
Unaudited Quarterly Information | 12 Months Ended |
Dec. 31, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
Unaudited Quarterly Information | 18. UNAUDITED QUARTERLY INFORMATION The following summarizes selected unaudited quarterly financial data for the year ended December 31, 2022 (amounts may not sum due to rounding): (in thousands, except share and per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Net sales $ 38,034 $ 45,542 $ 44,239 $ 35,366 Gross profit 15,879 (1) 19,321 (1) 19,168 15,653 Loss from operations ( 17,555 ) ( 14,743 ) ( 9,221 ) ( 6,349 ) Loss before income taxes ( 17,473 ) ( 14,787 ) ( 9,195 ) ( 6,127 ) Net loss and comprehensive loss ( 17,485 ) ( 14,796 ) ( 9,196 ) ( 6,170 ) Net loss attributable to Zevia PBC ( 10,898 ) ( 11,090 ) ( 7,484 ) ( 4,385 ) Basic earnings per share ( 0.28 ) (2) ( 0.27 ) (2) ( 0.16 ) (2) ( 0.09 ) Diluted earnings per share ( 0.28 ) (2) ( 0.27 ) (2) ( 0.16 ) (2) ( 0.09 ) Weighted-average shares of Class A Common Stock - basic and diluted 38,371,713 (2) 42,051,987 (2) $ 45,938,507 (2) 47,368,849 The following summarizes selected unaudited quarterly financial data for the year ended December 31, 2021 (amounts may not sum due to rounding): (in thousands, except share and per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Net sales $ 30,694 $ 34,352 $ 38,956 $ 34,170 Gross profit 14,704 (3) 16,673 (3) 17,767 (3) 14,797 (3) Loss from operations 243 ( 707 ) ( 49,498 ) (4) ( 37,464 ) (4) Loss before income taxes 247 ( 749 ) ( 49,711 ) (4) ( 37,420 ) (4) Net loss and comprehensive loss 247 ( 749 ) ( 49,761 ) ( 37,404 ) Net loss attributable to Zevia PBC — — ( 25,823 ) ( 20,163 ) Basic earnings per share N/A (5) N/A (5) ( 0.75 ) ( 0.59 ) Diluted earnings per share N/A (5) N/A (5) ( 0.75 ) ( 0.59 ) Weighted-average shares of Class A Common Stock - basic and diluted N/A (5) N/A (5) 34,440,982 34,450,409 (1) The Company reclassified $ 1.3 million and $ 1.9 million of expenses in the first and second quarter of 2022, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. (2) The Company has revised basic and diluted earnings per share amounts for the first, second, and third quarters of 2022 to include the impact of vested but unreleased restricted stock units which were previously excluded from the respective basic and diluted earnings per share computations. The impact of this immaterial correction was to decrease both basic and diluted loss per share by $0 .02 , $ 0.01 , and $ 0.01 , respectively, from the amounts previously reported in the Company’s Form 10-Q for each of the respective first, second, and third quarters of 2022. (3) The Company reclassified $ 0.5 million, $ 0.4 million, $ 0.8 million, and $ 1.0 million of expenses in the first, second, third, and fourth quarter of 2021, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. (4) Net loss in the second half of 2021 increased primarily due to $ 45.7 million and $ 31.9 million, respectively, of equity-based compensation in the third and fourth quarter of 2021 relating to restricted stock unit awards and phantom stock awards that generally vest over six months following the IPO. (5) Prior to the IPO, the Zevia LLC membership structure included various classes of Preferred Units and Common units. The Company analyzed the calculation of earnings per unit for periods prior to the IPO and determined that it resulted in values that would not be meaningful to the users of these consolidated financial statements. Therefore, earnings per share information has not been presented for the periods prior to the IPO. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Basis of Presentation | Basis of presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("US GAAP"). |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiary, Zevia LLC, that it controls due to ownership of a majority voting interest. All intercompany transactions and balances have been eliminated in consolidation. The Company owns a majority economic interest in, and operates and controls all of the businesses and affairs of, Zevia LLC. Accordingly, the Company has prepared these consolidated financial statements in accordance with Accounting Standards Codification (“ASC”) Topic 810, Consolidation . In connection with the IPO, the Company completed the Reorganization Transactions, which were accounted for consistent with a combination of entities under common control. As a result, the financial reports filed with the SEC by the Company subsequent to the Reorganization Transactions are prepared “as if” Zevia LLC is the accounting predecessor of the Company. The historical operations of Zevia LLC are deemed to be those of the Company. Thus, the consolidated financial statements included in this report reflect (i) the historical operating results and financial position of Zevia LLC prior to the Reorganization Transactions; (ii) the consolidated results of operations and financial position of the Company and Zevia LLC following the Reorganization Transactions; and (iii) the Company's equity structure for all periods presented. No step-up basis of intangible assets or goodwill was recorded. On January 1, 2022, Zevia PBC and Zevia LLC entered into a service agreement to transfer the services of all employees of Zevia PBC to Zevia LLC. Under terms of the service agreement between the entities, the payroll costs of employees are borne by Zevia LLC while certain other non-payroll costs, such as those associated with stock compensation arrangements, remain with Zevia PBC. In addition, pursuant to the Thirteenth Amended and Restated Limited Liability Company Agreement of Zevia LLC dated as of July 21, 2021, Zevia LLC shall reimburse Zevia PBC, for certain expenses for overhead, administrative, and other expenses, at Zevia PBC's discretion. For the year ended December 31, 2022, it was determined that the majority of such costs should be retained by Zevia PBC, with certain costs directly attributable to Zevia LLC being borne by that entity. These costs impacted the amount of net loss reported by Zevia LLC and consequently impacted the amount allocated to noncontrolling interest. |
Reclassifications | Reclassifications Certain amounts from prior periods have been reclassified in the consolidated balance sheet and consolidated statement of operations and comprehensive loss to conform to the current period presentation. For the activity in the periods prior to the IPO and Reorganization Transactions, common stock, additional paid-in capital, and accumulated deficit information has been combined and presented as member’s deficit in the accompanying consolidated balance sheets and consolidated statements of changes in redeemable convertible preferred units and equity (deficit). Consolidated Balance Sheet: The following table presents the adjustments made to the Consolidated Balance Sheet as of December 31, 2021, in order to reclassify computer software costs from property and equipment, net, to intangible assets, net in accordance with Accounting Standard Codification ("ASC") Topic 350, Intangibles—Goodwill and Other: (in thousands) December 31, 2021 Adjustments December 31, 2021 (adjusted) Property and equipment, net $ 3,664 $ ( 495 ) $ 3,169 Intangible assets, net 3,738 495 4,233 Consolidated Statement of Operations and Comprehensive Loss: The following table presents the reclassifications made to the Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2021 in order to reclassify repackaging and handling costs from cost of goods sold to selling and marketing expenses. The Company believes this classification change better portrays the financial impacts of the fulfillment activities conducted by the Company. The Company made this change in classification during the year ended December 31, 2022 as a result of an increasing trend in the occurrence of such fulfillment costs in the business. (in thousands) Year Ended December 31, 2021 Reclassification Year Ended December 31, 2021 Cost of goods sold $ 76,958 $ ( 2,727 ) $ 74,231 Gross profit 61,214 2,727 63,941 Selling and marketing expenses 42,403 2,727 45,130 |
Use of estimates | Use of estimates The preparation of the consolidated financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as the reported amount of net sales and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made by the Company relate to: net sales and associated cost recognition; the useful lives assigned to and the recoverability of property and equipment; reserves recorded for inventory obsolescence; the incremental borrowing rate for lease liabilities; allowance for doubtful accounts; recoverability of intangible assets; realization of deferred tax assets; and the determination of the fair value of equity instruments, including redeemable convertible preferred and common units, restricted unit awards, and equity-based compensation awards. On an ongoing basis, the Company evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of its assets and liabilities. As of December 31, 2022, the Company’s operations continued to be impacted by the effects of the COVID-19 pandemic including the emergence of new variants, with respect to broad-based inflation in input costs, logistics, manufacturing and labor costs. During the year ended December 31, 2022 , the Company experienced significant inflationary impact, which has created headwinds that the Company expects to continue into 2023. The effects of the COVID-19 pandemic are expected to continue to impact global economies, and the Company will continue to monitor the situation and the effects on its business and operations, particularly if the COVID-19 pandemic, including the emergence of new variants, continues for an extended period of time. |
Cash, cash equivalents and investments | Cash, cash equivalents and investments Cash and cash equivalents include cash and investments in short-term, highly liquid securities, with original maturities of three months or less. Investments with original maturities at the date of acquisition of more than three months are classified as short-term investments or long-term investments based on the remaining contractual maturity of the security at the reporting date. As of December 31, 2022 , the Company did no t hold any investments. As of December 31, 2021, the Company held $ 27.0 million of time deposits with contractual maturities of less than three months, which are classified as cash and cash equivalents on the consolidated balance sheets, and $ 30 million of time deposits with contractual maturities of greater than three months but less than one year which are classified as short-term investments on the consolidated balance sheets. The Company maintains cash deposits with high credit quality financial institutions. The deposits with these financial institutions may exceed the federally insured limits; however, these deposits typically are redeemable upon demand. The Company has not experienced any loss because of these deposits and does not expect to incur any losses in the future. |
Fair value of financial instruments | Fair value of financial instruments Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Subsequent changes in fair value of these financial assets and liabilities are recognized in earnings or other comprehensive income when they occur. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurement or assumptions that market participants would use in pricing the assets or liabilities, such as inherent risk, transfer restrictions, and credit risk. The three-level hierarchy for disclosure of fair value measurements is as follows: • Level 1. Quoted prices in active markets for identical assets or liabilities. • Level 2. Inputs other than Level 1 inputs that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or market-corroborated inputs. • Level 3. Unobservable inputs for the asset or liability. The Company’s material financial instruments consist primarily of cash and cash equivalents, short-term investments, accounts receivable, accounts payable, accrued expenses and other current liabilities. The carrying values of the Company’s cash, short-term investments, accounts receivable, accounts payable, accrued expenses and other current liabilities approximated their fair values at December 31, 2022 and 2021 due to the short period of time to maturity or repayment. As of December 31, 2022 and 2021, all cash and cash equivalents and short-term investments were considered Level 1. As of December 31, 2022 and 2021 , the Company did no t have any assets or liabilities measured on a recurring basis without observable market values that would require a high level of judgment to determine fair value (Level 3). The Company recognizes transfers between levels of the fair value hierarchy as of the end of the reporting period. For the years ended December 31, 2022 and 2021 , there were no transfers between levels of the fair value hierarchy. |
Other comprehensive loss | Other comprehensive loss The nature of the Company’s operations does not give rise to consequential other comprehensive loss. |
Accounts receivable and allowance for doubtful accounts | Accounts receivable and allowance for doubtful accounts Trade receivables are recorded at net realizable value, which includes an appropriate allowance for doubtful accounts. Credit is extended to customers based on an evaluation of their financial condition, credit rating, and trade references. The Company monitors exposure to credit losses and maintains an allowance for anticipated losses based on each customer’s credit condition and payment behavior. The Company’s accounts receivable balance is net of an allowance for doubtful accounts. The allowance for doubtful accounts was not material at December 31, 2022 or December 31, 2021 . Changes in the Allowance for Doubtful Accounts were as follows: Year Ended December 31, 2022 2021 Balance, beginning of the year $ 10 $ — Provision (recovery) for bad debt ( 10 ) 10 Balance, end of the year $ — $ 10 |
Inventories | Inventories Inventories consist of raw materials and finished goods. Raw materials include costs for the Company’s ingredients and packaging inventories. The costs of finished goods inventories include production fees from third-party manufacturers. Inventories are stated at the lower of average cost or net realizable value. The Company regularly reviews whether the net realizable value of its inventory is lower than its carrying value. Indicators that could result in inventory write downs include age of inventory, damaged inventory, slow moving products, and products at the end of their life cycles. While management believes that inventory is appropriately stated at the lower of average cost or net realizable value, judgment is involved in determining the net realizable value of inventory. Inventory valuation reserves were $ 0.4 million as of December 31, 2022 and 2021. |
Property and equipment, net | Property and equipment, net Property and equipment are recorded at cost. Additions, replacements, and leasehold improvements are capitalized, while maintenance and repairs that do not extend the useful life of an asset are expensed as incurred. Leasehold improvements are amortized using the straight-line method over the shorter of the remaining lease term or the estimated useful life of the improvement. When assets are retired or otherwise disposed, the cost and accumulated depreciation are removed from the respective accounts and any related gain or loss is recognized. Depreciation and amortization are computed using the following estimated useful lives of the assets: Asset Years Leasehold improvements Shorter of lease term or estimated useful life Computer equipment 3 Furniture and equipment 4 - 7 Vehicles 5 Quality control equipment 2 - 7 Buildings and improvements 7 - 30 The Company periodically reviews long-lived assets for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. In order to assess recoverability, the Company compares the estimated undiscounted future pre-tax cash flows from the use of the group of assets, as defined, to the carrying amount of such assets. Measurement of an impairment loss is based on the excess of the carrying amount of the group of assets over the long-lived asset’s fair value. The Company did no t recognize any impairment charges associated with long-lived assets during the years ended December 31, 2022 and 2021 . |
Leases | Leases The Company leases office space and vehicles under operating leases. Right of use ("ROU") lease assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments. Both the ROU lease asset and liability are recognized as of the lease commencement date based on the present value of the lease payments over the lease term. The Company’s leases do not provide an implicit borrowing rate that can readily be determined. Therefore, the Company applies a discount rate based on the incremental borrowing rate, which is determined using the Company’s synthetic credit rating and other information available as of the lease commencement date. ROU lease assets also include any lease payments made before their contractual due dates and exclude any lease incentives. The Company’s lease agreements may include options to extend the lease term or to terminate the lease early. The Company includes options to extend or terminate leases upon determination of the ROU lease asset and liability when it is reasonably certain the Company will exercise these options. Operating lease expense attributable to lease payments is recognized on a straight-line basis over the lease term and is included in general, and administrative expense on the consolidated statements of operations and comprehensive loss. The Company has lease arrangements that include lease and non-lease components. The non-lease components in the arrangements are not significant when compared to the lease components. For all leases, the Company accounts for the lease and non-lease components as a single component. The Company evaluates ROU assets for impairment consistent under the impairment of long-lived assets policy. The Company had no material finance leases as of December 31, 2022 and 2021 . |
Intangible assets, net | Intangible assets, net Intangible assets subject to amortization consist of customer relationships, which were acquired and are amortized over their estimated useful life of 1 5 years and computer software costs which are amortized over their estimated useful life of three years . In accordance with Accounting Standard Codification ("ASC") Topic 350, Intangibles—Goodwill and Other, intangible assets with definite lives are treated as a long-lived asset and are evaluated for impairment whenever events or changes in circumstances indicate that the asset’s carrying amount may not be recoverable. If impaired, the asset is written down to its estimated fair market value, which is generally measured by discounting future cash flows. Non-amortizable intangible assets consist of trademarks which represent the Company’s exclusive ownership of the Zevia® brand used in connection with the manufacture, marketing, and distribution of its carbonated beverages. The Company also owns several other trademarks in both the United States and in foreign countries. Intangible assets not subject to amortization are evaluated for impairment annually, or sooner if management believes such assets may be impaired. An impairment loss is recognized if the asset’s carrying amount exceeds its estimated fair market value. For the years ended December 31, 2022 and 2021 , no impairment losses were recorded. Certain external and internal computer software costs acquired for internal use are capitalized. Training costs and maintenance are expensed as incurred, while upgrades and enhancements are capitalized if it is probable that such expenditures will result in additional functionality. Capitalized costs are included within intangible assets, net. |
Debt issuance cost | Debt issuance cost Costs incurred in connection with securing a revolving line of credit agreement are capitalized. These costs are amortized over the term of the credit agreement. Debt issuance costs are included in Other non-current assets in the accompanying consolidated balance sheets. Net debt issuance costs totaled $ 0.3 million and $ 0 million as of December 31, 2022 and 2021 , respectively. |
Customer incentives and allowances | Customer incentives and allowances The Company offers its customers sales incentives that are designed to support the distribution of its products to consumers. These incentives and discounts include cash discounts, price allowances, volume-based rebates, product placement fees and certain other financial support for items such as trade promotions, displays, new products, consumer incentives and advertising assistance. These amounts are deducted from gross sales and are included under Net sales in the accompanying consolidated statements of operations and comprehensive loss. The Company maintains an allowance representing the estimated cost of certain customer incentives incurred but not yet realized as of the end of each respective year, which is recorded as an offset against customer accounts receivable, and is included under Accounts receivable, net in the accompanying consolidated balance sheets. The customer incentives and allowances were $ 5.6 million and $ 3.5 million as of December 31, 2022 and 2021 , respectively. |
Revenue recognition | Revenue recognition The Company recognizes revenue when performance obligations under the terms of a contract with the customer are satisfied. Product sales occur once control is transferred either upon shipment or delivery to the customer. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods, net of accruals for customer incentives and allowances. The amount of consideration the Company receives and revenue the Company recognizes varies with changes in customer incentives the Company offers to its customers. Customer incentives and allowances are estimated based on agreed upon terms as well as historical trends and current economic and market conditions, while cash discounts are based on trade terms and require management judgment with respect to estimating customer participation and performance levels. Differences between such estimated expenses and actual expenses for promotional and other allowance costs have historically been insignificant and are recognized in earnings in the period such differences are determined. The Company accounts for costs associated with shipping and handling activities that occur after the transfer of control as a fulfillment activity, instead of a separate performance obligation. The Company excludes from the transaction price those amounts which relate to sales and other taxes that are assessed by governmental authorities and that are imposed and concurrent with a specific revenue-producing transaction and collected by the Company from a customer. The Company’s general payment terms are short-term in duration. The Company does not have significant financing components or payment terms. |
Cost of goods sold | Cost of goods sold Cost of goods sold consists of all costs to acquire and manufacture the Company’s products including the cost of the various ingredients, packaging, in-bound freight and logistics, and third-party production fees—which are typically incurred at a flat rate per case produced—and all other costs incurred to bring the product to salable condition. The Company’s cost of goods sold is generally subject to price fluctuations in the marketplace for aluminum, logistics costs such as fuel, freight and warehousing for raw materials, bottling tolling fees, as well as shifting product mix. The Company has elected to classify shipping and handling costs for salable product outside of cost of goods sold, in selling and marketing expenses in the accompanying consolidated statements of operations and comprehensive loss. Such costs amounted to approximately $ 15.4 million and $ 13.2 million for the years ended December 31, 2022 and 2021 , respectively. |
Selling and marketing expenses | Selling and marketing expenses Selling and marketing expenses in the accompanying consolidated statements of operations and comprehensive loss include warehousing and distribution costs, shipping and handling costs, advertising, and marketing costs, which generally are expensed as incurred. Warehousing and distribution costs include storage, transfer, repacking and handling fees, and out-bound freight and delivery charges. The Company expenses sales and marketing costs as incurred. Advertising and marketing expenses represent costs associated with the promotion of the Zevia® brand and products as outlined in ASC Topic 730-25, Other Expenses – Advertising Costs , such as those for digital and other forms of advertising. Advertising and marketing expenses amounted to approximately $ 11.1 million and $ 12.6 million for the years ended December 31, 2022 and 2021 , respectively. |
General and administrative expenses | General and administrative expenses General and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss include personnel-related expenses, including salaries, bonuses, and benefits, technology expenses, professional fees, facility costs, including insurance, utilities and rent relating to our headquarters, and overhead costs. These costs are expensed as incurred. |
Equity-based compensation expense | Equity-based compensation expense The Company records equity-based compensation expense for employees and nonemployees under the provisions of ASC Topic 718, Compensation—Stock compensation (“ASC 718”), using a Black-Scholes-Merton option pricing model to calculate the fair value of stock options by date granted. The determination of the grant date fair value of stock options issued is affected by a number of variables, including the fair value of the Company’s common stock, the expected common stock price volatility over the expected life of the options, the expected term of the stock option, risk-free interest rates, and the expected dividend yield of the Company’s common stock. The Company derives its volatility from the average historical volatilities of several peer public companies over a period equivalent to the expected term of the awards. The Company estimates the expected term based on the simplified method prescribed by guidance provided by the Securities and Exchange Commission. This decision was based on the lack of relevant historical data due to the Company’s limited experience for the Company’s common stock. The risk-free interest rate is based on the United States Treasury yield curve in effect at the time of grant. Expected dividend yield is 0.0 % as the Company has not paid and does not anticipate paying dividends on its common stock. The fair value of stock options is recognized as expense on a straight-line basis over the requisite service period, which is typically four years. Equity-based compensation cost for restricted stock awards is measured based on the fair market value of the Company’s common stock at the date of grant and is recognized as expense over the requisite service period, which is the vesting period on a straight-line basis. Forfeitures are recognized as incurred. |
Depreciation and Amortization | Depreciation and Amortization Depreciation is primarily related to building and related improvements, computer equipment, quality control and marketing equipment, and leasehold improvements. Intangible assets subject to amortization consist of customer relationships and software applications. Non-amortizable intangible assets consist of trademarks, which represent the Company’s exclusive ownership of the Zevia® brand used in connection with the manufacturing, marketing, and distribution of its beverages. The Company also owns several other trademarks in both the U.S. and in foreign countries. |
Foreign currency transactions | Foreign currency transactions The functional currency of the Company is the U.S. Dollar. The Company sells and distributes its products to Canadian customers, who are invoiced and remit payment in Canadian dollars. All Canadian dollar transactions are translated into United States dollars using period-end rates of exchange for assets and liabilities, and average rates of exchange for the period for net sales and expenses. Foreign currency transaction (losses) gains for the years ended December 31, 2022 and 2021 amounted to approximately $ 0.2 million and $ 0.0 million, respectively, and are included under other income (expense), net in the accompanying consolidated statements of operations and comprehensive loss. |
Income Taxes | Income Taxes The Company is the managing member of Zevia LLC and, as a result, consolidates the financial results of Zevia LLC in the consolidated financial statements. Zevia LLC is a pass-through entity for U.S. federal and most applicable state and local income tax purposes. As an entity classified as a partnership for tax purposes, Zevia LLC is not subject to U.S. federal and certain state and local income taxes. Any taxable income or loss generated by Zevia LLC is passed through to its members, including the Company. The Company is taxed as a corporation and pays corporate federal, state and local taxes with respect to income allocated from Zevia LLC based on the Company's economic interest in Zevia LLC, which was 68.7 % and 53.4 % as of December 31, 2022 and 2021, respectively. Subsequent changes in economic ownership in Zevia LLC of the Company can occur as Zevia LLC holders may convert their shares of Class B common stock into an equivalent number of shares of Class A common stock with income (loss) allocated to the Company based on the economic interest applicable during each reporting period. The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities (“DTAs” and “DTLs”) for the expected future tax consequences of events that have been included in the financial statements. Under this method, we determine DTAs and DTLs on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on DTAs and DTLs is recognized in income in the period that includes the enactment date. We recognize DTAs to the extent that we believe that these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, carryback potential if permitted under the tax law, and results of recent operations. If we determine that we would be able to realize our DTAs in the future in excess of their net recorded amount, we would make an adjustment to the DTA valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740, Income Taxes on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. We recognize both accrued interest and penalties, when appropriate, in provision for income taxes in the accompanying consolidated statements of operations and comprehensive loss. |
Recent accounting pronouncements | Recent accounting pronouncements The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act ("JOBS Act"). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, the consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. Recently Issued Accounting Pronouncements – Recently Adopted In April 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2021-04, which included Topic 260, Earnings Per Share and Topic 718, Compensation - Stock Compensation . This guidance clarifies and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options due to a lack of explicit guidance in the FASB Codification. This ASU is effective for all entities for fiscal years beginning after December 15, 2021. Early adoption is permitted. The Company adopted ASU 2021-04 as of January 1, 2022. The adoption of ASU 2021-04 did not have a significant impact on the Company's financial statements as the Company does not have freestanding equity-classified written call options. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes . This ASU improves areas of US GAAP and reduces cost and complexity while maintaining usefulness. The main provisions remove certain exceptions, including the exception to the general methodology for calculating income taxes in an interim period when a year-to-date loss exceeds the anticipated loss for the year. In addition, the amendments simplify income tax accounting in the areas such as income based franchise taxes, eliminating the requirements to allocate consolidated current and deferred tax expense in certain instances and a requirement that an entity reflects the effect of enacted changes in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. This ASU is effective for private companies for annual reporting periods beginning after December 15, 2021, and interim periods within annual periods beginning after December 15, 2022. The Company adopted ASU 2019-12 as of January 1, 2022. The adoption of ASU 2019-12 did not have a significant impact on the Company’s financial statements. In August 2020, the FASB issued ASU No. 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU reduces the number of accounting models for convertible debt instruments and convertible preferred stock, as well as amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related earnings per share guidance and requires the application of the if-converted method for calculating diluted earnings per share, with the treasury stock method no longer permissible. The ASU is applicable to the Company for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. Adoption is either a modified retrospective method or a fully retrospective method of transition. The Company early adopted the ASU as of January 1, 2021 and applied the accounting standard update in computing diluted earnings per share for its redeemable convertible preferred units. The adoption of ASU 2020-06 did not have a significant impact on the Company’s financial statements. In August 2018, the FASB issued ASU No. 2018-15, Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract . The ASU aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal use software. This ASU is effective for private companies for annual reporting periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021. The Company adopted the ASU as of January 1, 2021. The adoption of ASU 2018-15 did not have a significant impact on the Company’s financial statements. Recently Issued Accounting Pronouncements – Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This ASU provides for a new impairment model that requires measurement and recognition of expected credit losses for most financial assets held. The ASU is effective for private companies for annual periods, and interim periods within those annual periods, beginning after December 15, 2022. The Company currently does not expect this guidance to have a significant impact on the Company’s financial statements as it does not have a history of material credit losses. Any other recently issued accounting pronouncements are neither relevant, nor expected to have a material impact on the Company’s financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Reclassification of Consolidated Balance Sheet | The following table presents the adjustments made to the Consolidated Balance Sheet as of December 31, 2021, in order to reclassify computer software costs from property and equipment, net, to intangible assets, net in accordance with Accounting Standard Codification ("ASC") Topic 350, Intangibles—Goodwill and Other: (in thousands) December 31, 2021 Adjustments December 31, 2021 (adjusted) Property and equipment, net $ 3,664 $ ( 495 ) $ 3,169 Intangible assets, net 3,738 495 4,233 |
Summary of Reclassification Adjustments on Cost of Goods Sold, Gross Profit, and Selling and Marketing Expenses of Condensed Consolidated Statements of Operations and Comprehensive Loss | (in thousands) Year Ended December 31, 2021 Reclassification Year Ended December 31, 2021 Cost of goods sold $ 76,958 $ ( 2,727 ) $ 74,231 Gross profit 61,214 2,727 63,941 Selling and marketing expenses 42,403 2,727 45,130 |
Summary of Changes in the Allowance for Doubtful Accounts | Changes in the Allowance for Doubtful Accounts were as follows: Year Ended December 31, 2022 2021 Balance, beginning of the year $ 10 $ — Provision (recovery) for bad debt ( 10 ) 10 Balance, end of the year $ — $ 10 |
Summary of estimated useful lives of the assets | Depreciation and amortization are computed using the following estimated useful lives of the assets: Asset Years Leasehold improvements Shorter of lease term or estimated useful life Computer equipment 3 Furniture and equipment 4 - 7 Vehicles 5 Quality control equipment 2 - 7 Buildings and improvements 7 - 30 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Disaggregation of Revenue | The following table disaggregates the Company’s sales by channel: Year Ended December 31, (in thousands) 2022 2021 Retail sales $ 145,041 $ 119,884 Online/e-commerce $ 18,140 18,288 Net sales $ 163,181 $ 138,172 The following table disaggregates the Company’s sales by geographic location of the respective customers: Year Ended December 31, (in thousands) 2022 2021 United States $ 145,180 $ 125,378 Canada 18,001 12,794 Net sales $ 163,181 $ 138,172 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories consist of the following as of: (in thousands) December 31, 2022 December 31, 2021 Raw materials $ 7,527 $ 10,193 Finished goods 20,049 21,308 Inventories $ 27,576 $ 31,501 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Estimated Useful Lives of Property and Equipment | Property and equipment consist of the following as of: (in thousands) December 31, 2022 December 31, 2021 Land $ 336 $ 336 Leasehold improvements 463 463 Computer equipment and software 796 (1) 813 (1) Furniture and equipment 544 521 Vehicles 197 38 Quality control and marketing equipment 1,635 532 Buildings and improvements 1,610 1,443 Assets not yet placed in service 1,128 456 6,709 4,602 Less accumulated depreciation ( 2,068 ) ( 1,433 ) Property and equipment, net $ 4,641 $ 3,169 (1) During the year ended December 31, 2022, the Company reclassified computer software costs from property and equipment, net, to intangible assets, net. Refer to Note 2 - Summary of Significant Accounting Policies f or amounts reclassified. |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Summary of Intangible Assets | The following table provides information pertaining to the Company’s intangible assets as of: December 31, 2022 (in thousands) Weighted-Average Remaining Useful Life Gross Carrying Amount Accumulated Amortization Intangible Assets, Net Software 2.0 $ 2,277 $ ( 1,429 ) $ 848 Customer relationships 2.7 3,007 ( 2,470 ) 537 5,284 ( 3,899 ) 1,385 Trademarks N/A 3,000 — 3,000 Intangible assets, net $ 8,284 $ ( 3,899 ) $ 4,385 December 31, 2021 (in thousands) Weighted-Average Remaining Useful Life Gross Carrying Amount Accumulated Amortization Intangible Assets, Net Software 1.3 $ 1,440 $ ( 945 ) $ 495 Customer relationships 3.7 3,007 ( 2,269 ) 738 4,447 ( 3,214 ) 1,233 Trademarks N/A 3,000 — 3,000 Intangible assets, net $ 7,447 $ ( 3,214 ) $ 4,233 |
Summary of Expected Amortization Expense for Intangible Assets with Definite Lives | Amortization expense for intangible assets with definite lives is expected to be as follows: (in thousands) 2023 $ 632 2024 563 2025 190 Expected amortization expense for intangible assets with definite lives $ 1,385 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Summary of Lease Cost | The Company leases office space and vehicles. The leases have remaining lease terms of one to 15 months. On March 25, 2022, the Company entered into an amendment to the lease for its corporate headquarters offices to extend the term through December 31, 2023, and to expand the total square footage from 17,923 square feet to 20,185 square feet commencing on May 1, 2022. In January 2023, the Company extended the lease term through December 31, 2026. The Company’s recognized lease costs include: Year Ended December 31, (in thousands) 2022 2021 Income Statement Operating lease cost (1) $ 705 $ 605 (1) Operating lease cost is recorded within general and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss. Year Ended December 31, 2022 2021 Weighted-average remaining lease term (months) 12.0 4.6 Weighted-average discount rate 7.6 % 7.6 % |
Summary of Maturities of Lease Payments Under Non-Cancellable Leases | Maturities of lease payments under non-cancellable leases were as follows: (in thousands) December 31, 2022 2023 $ 745 Total lease payments 745 Less Imputed Interest ( 30 ) Present value of lease liabilities $ 715 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following as of: (in thousands) December 31, 2022 December 31, 2021 Accrued employee compensation benefits $ 3,409 $ 3,032 Accrued direct selling costs 1,593 1,011 Accrued customer paid bottle deposits 1,253 774 Accrued other 2,153 1,888 Total $ 8,408 $ 6,705 |
Equity Based Compensation (Tabl
Equity Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule for Fair Value of Stock Options Granted Estimated on the Date of Grant Using the Black-Scholes Option | Year Ended December 31, 2022 2021 Stock price $ 3.40 $ 14.00 Exercise Price 3.93 14.00 Expected term (years) (1) 6.25 6.06 Expected volatility (2) 62.7 % 47.5 % Risk-Free interest rate (3) 2.7 % 0.9 % Dividend yield (4) 0.0 % 0.0 % (1) Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method. (2) Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term. (3) The risk-free rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term. (4) We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future. |
Summary of Stock Option Activity | year ended December 31, 2022: Shares Weighted average exercise price Weighted average remaining life Intrinsic value (in thousands) Outstanding Balance as of January 1, 2022 1,409,693 $ 2.30 Granted 1,721,320 $ 3.93 Exercised ( 246,415 ) $ 0.50 Forfeited and expired ( 114,844 ) $ 5.14 Balance as of December 31, 2022 2,769,754 $ 3.36 8.0 $ 4,455 Exercisable at the end of the period 945,790 $ 1.40 5.3 $ 3,273 Vested and expected to vest 2,769,754 $ 3.36 8.0 $ 4,455 The total intrinsic values of options exercised during the year ended December 31, 2022 was $ 0.9 million. |
Summary of Restricted Stock Unit Activity | year ended December 31, 2022: Shares Weighted average grant date fair value Aggregate Intrinsic Value (in thousands) Balance unvested shares at January 1, 2022 7,981,444 $ 5.33 Granted 1,121,740 $ 3.41 Vested ( 6,445,278 ) * $ 5.58 Forfeited ( 97,316 ) $ 4.81 Balance unvested at December 31, 2022 2,560,590 $ 3.90 10,473 Expected to vest at December 31, 2022 2,560,590 $ 3.90 10,473 *Shares vested includes 1,345,800 of RSUs which vested but are subject to a deferred settlement provision over the next three years and therefore have not been released. |
Major Customers, Accounts Rec_2
Major Customers, Accounts Receivable And Vendor Concentration (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | |
Concentration Risk [Line Items] | |
Summary Sales to Significant Customers | The table below represents the Company’s major customers that accounted for more than 10 % of total net sales for the periods: Year Ended December 31, 2022 2021 Customer A 15 % 17 % Customer B * 16 % Customer C * 11 % Customer D * 11 % |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | |
Concentration Risk [Line Items] | |
Summary Sales to Significant Customers | The table below represents the Company’s customers that accounted for more than 10 % of total accounts receivable, net as of: December 31, 2022 December 31, 2021 Customer B * 13 % Customer D 10 % 15 % Customer E 17 % 11 % Customer F * 12 % Customer H 12 % * |
Supplier Concentration Risk [Member] | Cost of Goods and Service Benchmark [Member] | |
Concentration Risk [Line Items] | |
Summary Sales to Significant Customers | The table below represents raw material vendors that accounted for more than 10 % of all raw material purchases for the periods: Year Ended December 31, 2022 2021 Vendor A 27 % 28 % Vendor B 18 % 22 % Vendor C 13 % 13 % * Less than 10 % of total net sales, accounts receivable, net or raw material purchases. |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Computation of Basic and Diluted Earnings per Share | The following table sets forth reconciliations of the numerators and denominators used to compute basic and diluted earnings per share of Class A common stock: Year Ended December 31, 2022 2021 (in thousands, except for share and per share amounts) Net loss per share: Numerator: Net loss and comprehensive loss $ ( 47,647 ) $ ( 87,667 ) Less: net loss attributable to Zevia LLC prior to the Reorganization Transactions — 1,913 Less: net loss attributable to non-controlling interests 13,790 39,768 Add: adjustment to reallocate net loss to controlling interest ( 1,298 ) (1) — Net loss to Zevia PBC $ ( 35,155 ) $ ( 45,986 ) Denominator: Weighted-average shares of Class A common stock outstanding – basic 41,739,061 34,450,409 Add: weighted average shares of vested and unreleased RSUs 1,730,322 (2) — Weighted-average basic and diluted shares 43,469,383 34,450,409 Loss per share of Class A common stock – basic $ ( 0.81 ) $ ( 1.33 ) (3) Loss per share of Class A common stock – diluted $ ( 0.81 ) $ ( 1.33 ) (3) (1) The numerator for the basic and diluted loss per share is adjusted for additional losses being attributed to controlling interest as a result of the impacts of vested but unreleased RSUs being included in the denominator of the basic and diluted loss per share. (2) The denominator for basic and diluted loss per share includes vested and unreleased RSUs as there are no conditions that would prevent these RSUs from being issued in the future as shares of Class A common stock except for the mere passage of time. (3) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the Reorganization Transactions and IPO. |
Summary of Antidilutive Securities Excluded From Computation of Earnings Per Share | Year Ended December 31, 2022 2021 Zevia LLC Class B Common Units exchangeable to shares of Class A common Stock 26,023,476 30,113,152 Stock options 2,239,025 1,483,824 Restricted stock units 3,473,655 7,981,444 |
Income Taxes And Tax Receivab_2
Income Taxes And Tax Receivable Agreement (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Expense | Income tax expense consists of the following: Year Ended December 31, 2022 2021 Current Federal $ — $ — State 65 34 Total 65 34 Deferred Federal — — State — — Total — — Provision for income taxes $ 65 $ 34 |
Summary of Reconciliation Between the Effective Tax Rate and the Applicable U.S. Federal Statutory Income Tax Rate | A reconciliation between the Company’s effective tax rate and the applicable U.S. federal statutory income tax rate is summarized as follows: Year Ended December 31, 2022 2021 Tax computed at federal statutory rate 21.0 % 21.0 % State tax, net of federal tax benefit 0.8 % 1.7 % Permanent items and other ( 0.8 )% 0.0 % Non-controlling interests ( 5.8 )% ( 10.0 )% Equity-based compensation ( 9.2 )% ( 3.7 )% Valuation allowance ( 6.1 )% ( 9.0 )% Effective Tax Rate ( 0.1 )% 0.0 % |
Schedule of Components that Comprise Net Deferred Tax Assets | The components that comprise the Company's net deferred tax assets consist of the following: Year Ended December 31, 2022 2021 Deferred tax assets Investment in Zevia LLC $ 53,427 $ 47,955 Net operating loss carryforwards 15,970 4,144 Equity-based compensation 3,161 6,840 Other temporary differences 104 1 Total deferred tax assets 72,662 58,940 Valuation allowance for deferred tax assets ( 72,662 ) ( 58,940 ) Net deferred tax assets $ — $ — |
Summary of Activity Related to Valuation Allowance | The following table summarizes the activity related to the Company's valuation allowance: Year Ended December 31, 2022 2021 Balance, beginning of the year $ 58,940 $ — Increases related to current year positions 13,722 58,940 Balance, end of the year $ 72,662 $ 58,940 |
Unaudited Quarterly Informati_2
Unaudited Quarterly Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of Unaudited Quarterly Financial Data | The following summarizes selected unaudited quarterly financial data for the year ended December 31, 2022 (amounts may not sum due to rounding): (in thousands, except share and per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Net sales $ 38,034 $ 45,542 $ 44,239 $ 35,366 Gross profit 15,879 (1) 19,321 (1) 19,168 15,653 Loss from operations ( 17,555 ) ( 14,743 ) ( 9,221 ) ( 6,349 ) Loss before income taxes ( 17,473 ) ( 14,787 ) ( 9,195 ) ( 6,127 ) Net loss and comprehensive loss ( 17,485 ) ( 14,796 ) ( 9,196 ) ( 6,170 ) Net loss attributable to Zevia PBC ( 10,898 ) ( 11,090 ) ( 7,484 ) ( 4,385 ) Basic earnings per share ( 0.28 ) (2) ( 0.27 ) (2) ( 0.16 ) (2) ( 0.09 ) Diluted earnings per share ( 0.28 ) (2) ( 0.27 ) (2) ( 0.16 ) (2) ( 0.09 ) Weighted-average shares of Class A Common Stock - basic and diluted 38,371,713 (2) 42,051,987 (2) $ 45,938,507 (2) 47,368,849 The following summarizes selected unaudited quarterly financial data for the year ended December 31, 2021 (amounts may not sum due to rounding): (in thousands, except share and per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Net sales $ 30,694 $ 34,352 $ 38,956 $ 34,170 Gross profit 14,704 (3) 16,673 (3) 17,767 (3) 14,797 (3) Loss from operations 243 ( 707 ) ( 49,498 ) (4) ( 37,464 ) (4) Loss before income taxes 247 ( 749 ) ( 49,711 ) (4) ( 37,420 ) (4) Net loss and comprehensive loss 247 ( 749 ) ( 49,761 ) ( 37,404 ) Net loss attributable to Zevia PBC — — ( 25,823 ) ( 20,163 ) Basic earnings per share N/A (5) N/A (5) ( 0.75 ) ( 0.59 ) Diluted earnings per share N/A (5) N/A (5) ( 0.75 ) ( 0.59 ) Weighted-average shares of Class A Common Stock - basic and diluted N/A (5) N/A (5) 34,440,982 34,450,409 (1) The Company reclassified $ 1.3 million and $ 1.9 million of expenses in the first and second quarter of 2022, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. (2) The Company has revised basic and diluted earnings per share amounts for the first, second, and third quarters of 2022 to include the impact of vested but unreleased restricted stock units which were previously excluded from the respective basic and diluted earnings per share computations. The impact of this immaterial correction was to decrease both basic and diluted loss per share by $0 .02 , $ 0.01 , and $ 0.01 , respectively, from the amounts previously reported in the Company’s Form 10-Q for each of the respective first, second, and third quarters of 2022. (3) The Company reclassified $ 0.5 million, $ 0.4 million, $ 0.8 million, and $ 1.0 million of expenses in the first, second, third, and fourth quarter of 2021, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. (4) Net loss in the second half of 2021 increased primarily due to $ 45.7 million and $ 31.9 million, respectively, of equity-based compensation in the third and fourth quarter of 2021 relating to restricted stock unit awards and phantom stock awards that generally vest over six months following the IPO. (5) Prior to the IPO, the Zevia LLC membership structure included various classes of Preferred Units and Common units. The Company analyzed the calculation of earnings per unit for periods prior to the IPO and determined that it resulted in values that would not be meaningful to the users of these consolidated financial statements. Therefore, earnings per share information has not been presented for the periods prior to the IPO. |
Description of Business and B_2
Description of Business and Basis of Presentation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jul. 21, 2021 | Dec. 31, 2021 | Dec. 31, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | |
Issuance of common stock, net of commission | $ 90,080 | ||
Common Class A [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Common stock shares authorized | 550,000,000 | ||
Common Class A [Member] | Blocker Companies [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Business acquisition, consideration in cash | $ 23,700 | ||
Business acquisition, percentage of owners acquired | 100% | ||
Business acquisition, equity interest issued, number of shares | 23,716,450 | ||
Common Class B Units [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Partners' Capital Account, Sale of Units | $ 25,500 | ||
Common Class B Units [Member] | Blocker Companies [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Issuance of units | 1,811,298 | ||
IPO [Member] | Common Class A [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Stock issued during period shares new issues | 6,900,000 | 6,900,000 | |
Proceeds from issuance of initial public offering | $ 81,700 | ||
Payments for repurchase of initial public offering | 8,400 | ||
Issuance of common stock, net of commission | $ 7 | ||
Zevia L L C [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Percentage of ownership and economic interest held by parent | 53.40% | 68.70% | |
Percentage of ownership and economic interest held by non-controlling interest | 46.60% | 31.30% | |
Zevia L L C [Member] | IPO [Member] | Common Class A [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Stock issued during period shares new issues | 3,767,440 | ||
Issuance of common stock, net of commission | $ 3 | ||
ZEVIA PBC [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Proceeds from initial public offering utilized for cancellation Of options outstanding | $ 400 | ||
Common stock shares authorized | 800,000,000 | ||
Preferred stock, shares authorized | 10,000,000 | ||
ZEVIA PBC [Member] | Common Class A [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Partners' Capital Account, Sale of Units | $ 90,100 | ||
Number of additional Shares acquired by underwriter from selling stockholders | 32,560 | ||
Common stock shares authorized | 550,000,000 | ||
ZEVIA PBC [Member] | Common Class B Units [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Common stock shares authorized | 250,000,000 | ||
Issuance of units | 1,956,142 | ||
Common Stock, Exchange Basis | one-for-one basis | ||
ZEVIA PBC [Member] | IPO [Member] | Common Class A [Member] | |||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | |||
Stock issued during period shares new issues | 10,700,000 | ||
Sale of stock, price per share | $ 14 | ||
Proceeds from issuance of initial public offering | $ 139,700 | ||
Number of additional Shares acquired by underwriter from selling stockholders | 1,605,000 | ||
Underwriting discounts and commissions | $ 10,100 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Short-Term Investments | $ 0 | $ 30,000,000 | |
Investments | 0 | ||
Impairment charges | 0 | 0 | |
Net debt issuance cost | 300,000 | 0 | |
Customer incentives and allowances | 5,600,000 | 3,500,000 | |
Cost and expenses | 15,400,000 | 13,200,000 | |
Foreign currency transaction (losses) gains | 200,000 | 0 | |
Marketing and advertising expense | 11,100,000 | 12,600,000 | |
Impairment charges | 0 | 0 | |
Inventory valuation reserves | 400,000 | 400,000 | |
Fair value Transfer | $ 0 | 0 | |
Dividend yield | [1] | 0% | |
Customer Relationships [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Useful lives | 5 years | ||
Computer software [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Useful lives | 3 years | ||
Fair value measurements recurring member | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Fair value net asset liability | $ 0 | $ 0 | |
Zevia L L C [Member] | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Percentage of ownership and economic interest held by parent | 68.70% | 53.40% | |
Short-Term Investments | $ 30,000,000 | ||
Cash and Cash Equivalents, at Carrying Value | $ 27,000,000 | ||
[1] (4) We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future. |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Reclassification of Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property and equipment, net | $ 4,641 | $ 3,169 |
Intangible assets, net | $ 4,385 | 4,233 |
Previously Reported [Member] | ||
Property and equipment, net | 3,664 | |
Intangible assets, net | 3,738 | |
Restatement Adjustment [Member] | ||
Property and equipment, net | (495) | |
Intangible assets, net | $ 495 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Reclassifications of Consolidated Statement of Operations and Comprehensive Loss (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |||||||
Cost of goods sold | $ 93,160 | $ 74,231 | ||||||||||||||
Gross Profit | $ 15,653 | $ 19,168 | $ 19,321 | [1] | $ 15,879 | [1] | $ 14,797 | [2] | $ 17,767 | [2] | $ 16,673 | [2] | $ 14,704 | [2] | 70,021 | 63,941 |
Selling and marketing | $ 52,869 | 45,130 | ||||||||||||||
Previously Reported [Member] | ||||||||||||||||
Cost of goods sold | 76,958 | |||||||||||||||
Gross Profit | 61,214 | |||||||||||||||
Selling and marketing | 42,403 | |||||||||||||||
Revision of Prior Period, Adjustment [Member] | ||||||||||||||||
Cost of goods sold | (2,727) | |||||||||||||||
Gross Profit | 2,727 | |||||||||||||||
Selling and marketing | $ 1,900 | $ 1,300 | $ 800 | $ 1,000 | $ 400 | $ 500 | $ 2,727 | |||||||||
[1] The Company reclassified $ 1.3 million and $ 1.9 million of expenses in the first and second quarter of 2022, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. The Company reclassified $ 0.5 million, $ 0.4 million, $ 0.8 million, and $ 1.0 million of expenses in the first, second, third, and fourth quarter of 2021, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Summary of Changes in the Allowance for Doubtful Accounts (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Accounting Policies [Abstract] | ||
Balance, beginning of the year | $ 10 | $ 0 |
Provision (recovery) for bad debt | (10) | 10 |
Balance, end of the year | $ 0 | $ 10 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Summary of estimated useful lives of the assets (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Useful Life | Shorter of lease term or estimated useful life |
Computer Equipment and Software [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 3 years |
Furniture and Equipment [Member] | Maximum Member | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 7 years |
Furniture and Equipment [Member] | Minimum Member | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 4 years |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 5 years |
Quality Control Equipment [Member] | Maximum Member | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 7 years |
Quality Control Equipment [Member] | Minimum Member | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 2 years |
Buildings and Improvements [Member] | Maximum Member | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 30 years |
Buildings and Improvements [Member] | Minimum Member | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life (In Years) | 7 years |
Revenues - Summary of Disaggreg
Revenues - Summary of Disaggregation of Revenue (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 163,181 | $ 138,172 |
Retail sales [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 145,041 | 119,884 |
Online/e-commerce [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 18,140 | 18,288 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 145,180 | 125,378 |
Canada | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 18,001 | $ 12,794 |
Revenues - Additional Informati
Revenues - Additional Information (Detail) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Revenue from Contract with Customer [Abstract] | ||
Revenue, remaining performance obligation, amount | $ 0 | $ 0 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 7,527 | $ 10,193 |
Finished goods | 20,049 | 21,308 |
Inventories | $ 27,576 | $ 31,501 |
Property and Equipment, Net - S
Property and Equipment, Net - Summary of Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 6,709 | $ 4,602 | |
Less accumulated depreciation | (2,068) | (1,433) | |
Property and equipment, net | 4,641 | 3,169 | |
Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 336 | 336 | |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 463 | 463 | |
Computer Equipment and Software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | [1] | 796 | 813 |
Furniture and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 544 | 521 | |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 197 | 38 | |
Quality Control Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 1,635 | 532 | |
Buildings and improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 1,610 | 1,443 | |
Assets not yet Placed in Service [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 1,128 | $ 456 | |
[1] (1) During the year ended December 31, 2022, the Company reclassified computer software costs from property and equipment, net, to intangible assets, net. Refer to Note 2 - Summary of Significant Accounting Policies f or amounts reclassified. |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation expense | $ 0.7 | $ 0.6 |
INDIANA | Warehouse Facility [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Purchase price of asset | $ 1.7 |
Intangible Assets, Net - Summar
Intangible Assets, Net - Summary of Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule Of Intangible Assets [Line Items] | ||
Finite-Lived intangible assets, gross | $ 5,284 | $ 4,447 |
Accumulated amortization | (3,899) | (3,214) |
Finite-Lived Intangible Assets, Net, Total | 1,385 | 1,233 |
Intangible assets, net | 4,385 | 4,233 |
Intangible assets, net | $ 8,284 | $ 7,447 |
Trademarks [Member] | ||
Schedule Of Intangible Assets [Line Items] | ||
Weighted-Average Remaining Useful Life | 2 years 8 months 12 days | 3 years 8 months 12 days |
Indefinite-lived intangible assets, excluding goodwill | $ 3,000 | $ 3,000 |
Customer Relationships [Member] | ||
Schedule Of Intangible Assets [Line Items] | ||
Finite-Lived intangible assets, gross | 3,007 | 3,007 |
Accumulated amortization | (2,470) | (2,269) |
Finite-Lived Intangible Assets, Net, Total | $ 537 | $ 738 |
Software [Member] | ||
Schedule Of Intangible Assets [Line Items] | ||
Weighted-Average Remaining Useful Life | 2 years | 1 year 3 months 18 days |
Finite-Lived intangible assets, gross | $ 2,277 | $ 1,440 |
Accumulated amortization | (1,429) | (945) |
Finite-Lived Intangible Assets, Net, Total | $ 848 | $ 495 |
Intangible Assets, Net - Summ_2
Intangible Assets, Net - Summary of Expected Amortization Expense for Intangible Assets with Definite Lives (Detail) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||
2023 | $ 632 | |
2024 | 563 | |
2025 | 190 | |
Finite-Lived Intangible Assets, Net, Total | $ 1,385 | $ 1,233 |
Intangible Assets, Net - Additi
Intangible Assets, Net - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule Of Intangible Assets [Line Items] | ||
Amortization expense | $ 700,000 | $ 400,000 |
Impairment losses on intangible assets | 0 | 0 |
Software [Member] | ||
Schedule Of Intangible Assets [Line Items] | ||
Amortization expense | $ 400,000 | $ 200,000 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | 6 Months Ended | 12 Months Ended | ||||
Feb. 22, 2022 | Jun. 01, 2021 | Jun. 30, 2020 | Dec. 31, 2021 | Dec. 31, 2019 | Dec. 31, 2022 | |
Line of Credit Facility [Line Items] | ||||||
Fixed Charge Coverage Ratio | Thereafter, the Borrower must satisfy a financial covenant requiring a minimum fixed charge coverage ratio of 1.00 to 1.00 | |||||
Loan and Security Agreement [Member] | Minimum Member | ||||||
Line of Credit Facility [Line Items] | ||||||
Applicable Margin | 1.50% | |||||
Loan and Security Agreement [Member] | Maximum Member | ||||||
Line of Credit Facility [Line Items] | ||||||
Applicable Margin | 2% | |||||
Secured Revolving Line of Credit [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Aggregate Principal Amount | $ 20,000,000 | |||||
Amount of line of credit use for letter of credit issuances | 2,000,000 | |||||
Commitment of secured line of credit | 10,000,000 | |||||
Liquidity commitment | 7,000,000 | |||||
Borrowing base secured revolving line of credit | $ 3,000,000 | |||||
Borrowing Base | 17.50% | |||||
Secured Revolving Line of Credit [Member] | Minimum Member | ||||||
Line of Credit Facility [Line Items] | ||||||
Applicable Margin | 0.50% | |||||
Secured Revolving Line of Credit [Member] | Maximum Member | ||||||
Line of Credit Facility [Line Items] | ||||||
Applicable Margin | 1% | |||||
Revolving Credit Facility [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Line of credit maximum borrowing capacity | $ 9,000,000 | |||||
Line of Credit Maturity Date | Apr. 15, 2022 | |||||
Line of credit interest rate | 7.50% | |||||
Outstanding balance of line of credit | $ 0 | $ 0 | ||||
Extended line of credit maturity date | Apr. 15, 2023 | |||||
Amended Revolving Credit Facility [Member] | ||||||
Line of Credit Facility [Line Items] | ||||||
Increase amount of line of credit | $ 12,000,000 |
Leases Additional Information (
Leases Additional Information (Detail) | Mar. 25, 2022 ft² |
Minimum Member | |
Lessee, Lease, Description [Line Items] | |
Area of land | 17,923 |
Maximum Member | |
Lessee, Lease, Description [Line Items] | |
Area of land | 20,185 |
Leases - Summary of Lease Costs
Leases - Summary of Lease Costs As Follows (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Income Statement | |||
Operating lease cost | [1] | $ 705 | $ 605 |
Other Information | |||
Weighted-average remaining lease term (months) | 12 months | 4 months 18 days | |
Weighted-average discount rate | 7.60% | 7.60% | |
[1] Operating lease cost is recorded within general and administrative expenses in the accompanying consolidated statements of operations and comprehensive loss. |
Leases - Summary of Maturities
Leases - Summary of Maturities of Lease Payments Under Non Cancellable Leases Were As Follows (Detail) $ in Thousands | Dec. 31, 2022 USD ($) |
Lessee, Operating Lease, Liability, to be Paid [Abstract] | |
2023 | $ 745 |
Total lease payments | 745 |
Less Imputed Interest | (30) |
Present value of lease liabilities | $ 715 |
Employee Benefit Plan-Additiona
Employee Benefit Plan-Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Defined contribution plan, employer matching contribution, percent | 4% | |
Contribution expense | $ 0.5 | $ 0.4 |
Maximum [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Define contribution plan, percentage of contribution by employees | 90% | |
Minimum [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Define contribution plan, percentage of contribution by employees | 1% |
Balance Sheet Components - Summ
Balance Sheet Components - Summary of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accrued employee compensation benefits | $ 3,409 | $ 3,032 |
Accrued direct selling costs | 1,593 | 1,011 |
Accrued customer paid bottle deposits | 1,253 | 774 |
Accrued other | 2,153 | 1,888 |
Total | $ 8,408 | $ 6,705 |
Equity-Based Compensation - Add
Equity-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | ||
Jul. 31, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Remaining service period of the awards | 25 months | |||
Stock compensation expense | $ 8.2 | |||
Aggregate intrinsic value | $ 0.9 | |||
Equity Incentive Plan 2021 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage of increase in shares available for issuance | 5% | |||
The amount of common stock available under the plan for future grants and/or issuances | 2,500,000 | |||
Restricted Stock Units (RSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Estimated weighted average period over which expense is expected to be recognized | 2 years 3 months 18 days | |||
Share-based Payment Arrangement, Plan Modification, Incremental Cost | $ 48.9 | |||
Number of Monthly Installments Granted Equally Following The Termination Of Lockup Period | 36 months | |||
Settlement period on vesting of RSUs | 30 days | |||
Amount of cost to be recognized for non-vested award under share-based payment arrangement | $ 9.8 | |||
Employee Stock Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized unit compensation expense on unvested unit options | $ 3.4 | |||
Estimated weighted average period over which expense is expected to be recognized | 3 years 2 months 12 days | |||
Granted (in dollars per share) | $ 1.97 | $ 6.39 | ||
Restricted Phantom Class A Common Units [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of RSUs that were modified during the period | 2,422,644 | |||
Share-based Payment Arrangement, Plan Modification, Incremental Cost | $ 33.9 |
Equity Based Compensation - Fai
Equity Based Compensation - Fair Value of Stock Options Granted Estimated on the Date of Grant Using the Black-Scholes Option (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock price | $ 3.40 | ||
Exercise Price | $ 3.93 | ||
Expected term (years) | [1] | 6 years 3 months | |
Expected volatility | [2] | 62.70% | |
Risk-Free interest rate | [3] | 2.70% | |
Dividend yield | [4] | 0% | |
2022 | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Stock price | $ 14 | ||
Exercise Price | $ 14 | ||
Expected term (years) | [1] | 6 years 21 days | |
Expected volatility | [2] | 47.50% | |
Risk-Free interest rate | [3] | 0.90% | |
Dividend yield | [4] | 0% | |
[1] (1) Expected term represents the estimated period of time until an award is exercised and was determined using the simplified method. (2) Expected volatility is based on the historical volatility of a selected peer group over a period equivalent to the expected term. (3) The risk-free rate is an interpolation of yields on U.S. Treasury securities with maturities equivalent to the expected term. (4) We have assumed a dividend yield of zero as we have no plans to declare dividends in the foreseeable future. |
Equity Based Compensation - Sum
Equity Based Compensation - Summary of Stock Option Activity (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Share-Based Payment Arrangement [Abstract] | |
Outstanding Balance as of January 1, 2021 | shares | 1,409,693 |
Granted | shares | 1,721,320 |
Exercised | shares | (246,415) |
Forfeited and expired | shares | (114,844) |
Balance as of December 31,2021 | shares | 2,769,754 |
Exercisable at the end of the period | shares | 945,790 |
Vested and expected to vest | shares | 2,769,754 |
Weighted average exercise price, Beginning balance | $ / shares | $ 2.30 |
Weighted average exercise price, Granted | $ / shares | 3.93 |
Weighted average exercise price, Exercised | $ / shares | 0.50 |
Weighted average exercise price, Forfeited and cancelled | $ / shares | 5.14 |
Weighted average exercise price, Ending balance | $ / shares | 3.36 |
Weighted average exercise price, Exercisable | $ / shares | 1.40 |
Weighted average exercise price, Vested and expected to vest | $ / shares | $ 3.36 |
Weighted average remaining life Outstanding | 8 years |
Weighted average remaining life Exercisable | 5 years 3 months 18 days |
Weighted average remaining life Vested and expected to vest | 8 years |
Aggregate intrinsic value | $ | $ 4,455 |
Aggregate intrinsic value, Exercisable | $ | 3,273 |
Aggregate intrinsic value, Vested and expected to vest | $ | $ 4,455 |
Equity Based Compensation - S_2
Equity Based Compensation - Summary of Restricted Stock Unit Activity (Details) - Restricted Stock Units (RSUs) [Member] $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Balance nonvested shares at January 1, 2021 | shares | 7,981,444 |
Restricted stock units, Granted | shares | 1,121,740 |
Restricted stock units, Vested | shares | (6,445,278) |
Restricted stock units, Forfeited | shares | (97,316) |
Balance non vested at December 31, 2022 | shares | 2,560,590 |
Vested and expected to vest at December 31, 2022 | shares | 2,560,590 |
Weighted average grant date fair value, Beginning balance | $ / shares | $ 5.33 |
Weighted average grant date fair value, Granted | $ / shares | 3.41 |
Weighted average grant date fair value, Vested | $ / shares | 5.58 |
Weighted average grant date fair value, Forfeited | $ / shares | 4.81 |
Weighted average grant date fair value, Ending balance | $ / shares | 3.90 |
Weighted average grant date fair value, Vested and expected to vest at December 31, 2021 | $ / shares | $ 3.90 |
Aggregate intrinsic value, Non vested | $ | $ 10,473 |
Aggregate intrinsic value, Vested and expected to vest | $ | $ 10,473 |
Equity Based Compensation - S_3
Equity Based Compensation - Summary of Restricted Stock Unit Activity (Parenthetical) (Details) | 12 Months Ended |
Dec. 31, 2022 shares | |
Share-Based Payment Arrangement [Abstract] | |
Restricted Unsettled Shares, Vested | 1,345,800 |
Major Customers, Accounts Rec_3
Major Customers, Accounts Receivable And Vendor Concentration - Summary Sales to Significant Customers (Detail) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer A [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 15% | 17% |
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer B [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 16% | |
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer C [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 11% | |
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | Customer D [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 11% | |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer B [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 13% | |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer D [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 10% | 15% |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer E [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 17% | 11% |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer F [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 12% | |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customer H [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 12% | |
Supplier Concentration Risk [Member] | Cost of Goods and Service Benchmark [Member] | Vendor A [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 27% | 28% |
Supplier Concentration Risk [Member] | Cost of Goods and Service Benchmark [Member] | Vendor B [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 18% | 22% |
Supplier Concentration Risk [Member] | Cost of Goods and Service Benchmark [Member] | Vendor C [Member] | ||
Concentration Risk [Line Items] | ||
Concentration Risk, Percentage | 13% | 13% |
Major Customers, Accounts Rec_4
Major Customers, Accounts Receivable And Vendor Concentration - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2022 | |
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | Minimum [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 10% |
Customer Concentration Risk [Member] | Revenue from Contract with Customer Benchmark [Member] | Customers [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 10% |
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Customers [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 10% |
Supplier Concentration Risk [Member] | Cost of Goods and Service Benchmark [Member] | Customers [Member] | |
Concentration Risk [Line Items] | |
Concentration Risk, Percentage | 10% |
Loss Per Share - Summary of Com
Loss Per Share - Summary of Computation of Basic and Diluted Earnings per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | ||||||
Basic net loss per share: | |||||||||||||||
Net loss attributable to Zevia LLC prior to the Reorganization Transactions | $ 0 | $ 1,913 | |||||||||||||
Net loss attributable to noncontrolling interest | 13,790 | 39,768 | |||||||||||||
Net income (loss) attributable to Zevia PBC | $ (6,170) | $ (9,196) | $ (14,796) | $ (17,485) | $ (37,404) | $ (49,761) | $ (749) | $ 247 | $ (47,647) | $ (87,667) | |||||
Weighted average common units outstanding, basic | 47,368,849 | 45,938,507 | [1] | 42,051,987 | [1] | 38,371,713 | [1] | 34,450,409 | 34,440,982 | 43,469,383 | 34,450,409 | ||||
Weighted average common units outstanding, diluted | 47,368,849 | 45,938,507 | [1] | 42,051,987 | [1] | 38,371,713 | [1] | 34,450,409 | 34,440,982 | 43,469,383 | 34,450,409 | ||||
Basic earnings per share | $ (0.09) | $ (0.16) | [1] | $ (0.27) | [1] | $ (0.28) | [1] | $ (0.59) | $ (0.75) | $ (0.81) | $ (1.33) | [2] | |||
Diluted earnings per share | $ (0.09) | $ (0.16) | [1] | $ (0.27) | [1] | $ (0.28) | [1] | $ (0.59) | $ (0.75) | $ (0.81) | $ (1.33) | [2] | |||
Common Class A [Member] | |||||||||||||||
Basic net loss per share: | |||||||||||||||
Net loss and comprehensive loss | $ (47,647) | $ (87,667) | |||||||||||||
Net loss attributable to Zevia LLC prior to the Reorganization Transactions | 0 | 1,913 | |||||||||||||
Net loss attributable to noncontrolling interest | 13,790 | 39,768 | |||||||||||||
Adjustment to reallocate net loss to controlling interest | [3] | (1,298) | |||||||||||||
Net income (loss) attributable to Zevia PBC | $ (35,155) | $ (45,986) | |||||||||||||
Weighted average common units outstanding, basic | 41,739,061 | 34,450,409 | |||||||||||||
Weighted average common units outstanding, diluted | 43,469,383 | 34,450,409 | |||||||||||||
Basic earnings per share | $ (0.81) | $ (1.33) | [4] | ||||||||||||
Diluted earnings per share | (0.81) | $ (1.33) | [4] | ||||||||||||
Common Class A [Member] | RSU [Member] | |||||||||||||||
Basic net loss per share: | |||||||||||||||
Weighted average shares of vested and unreleased RSUs | [5] | $ 1,730,322 | |||||||||||||
[1] The Company has revised basic and diluted earnings per share amounts for the first, second, and third quarters of 2022 to include the impact of vested but unreleased restricted stock units which were previously excluded from the respective basic and diluted earnings per share computations. The impact of this immaterial correction was to decrease both basic and diluted loss per share by $0 .02 , $ 0.01 , and $ 0.01 , respectively, from the amounts previously reported in the Company’s Form 10-Q for each of the respective first, second, and third quarters of 2022. (1) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the reorganization transactions and initial public offering (see Note 16). The numerator for the basic and diluted loss per share is adjusted for additional losses being attributed to controlling interest as a result of the impacts of vested but unreleased RSUs being included in the denominator of the basic and diluted loss per share. Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the Reorganization Transactions and IPO. The denominator for basic and diluted loss per share includes vested and unreleased RSUs as there are no conditions that would prevent these RSUs from being issued in the future as shares of Class A common stock except for the mere passage of time. |
Loss Per Share - Summary of Ant
Loss Per Share - Summary of Antidilutive Securities Excluded From Computation of Earnings Per Share (Detail) - shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Common Class A [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 26,023,476 | 30,113,152 |
Employee Stock Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,239,025 | 1,483,824 |
Restricted Stock Units (RSUs) [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 3,473,655 | 7,981,444 |
Income Taxes And Tax Receivab_3
Income Taxes And Tax Receivable Agreement (Additional Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Aug. 16, 2022 | Feb. 09, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Contingency [Line Items] | ||||
Valuation allowance | $ 72,700 | $ 58,900 | ||
Deferred Tax Assets Liabilities Net | 0 | 0 | ||
Unrecognized Tax Benefits, Ending Balance | 0 | |||
Provision for income taxes | 65 | 34 | ||
Taxable income under previously enacted provisions | $ 1,000 | |||
Corporate alternative minimum tax | 15% | |||
Average applicable income limit under I R A | $ 1,000,000 | |||
Percent of excise tax on net stock repurchases | 1% | |||
Interest Rate Cap [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Amount of corporate income tax credits | $ 5,000 | |||
COVID-19 | ||||
Income Tax Contingency [Line Items] | ||||
Provision for income taxes | 0 | |||
State | ||||
Income Tax Contingency [Line Items] | ||||
Operating Loss Carry forwards | 36,800 | |||
federal | ||||
Income Tax Contingency [Line Items] | ||||
Operating Loss Carry forwards | $ 66,200 | |||
Effective Income Tax Rates reconciliation Tax Cuts and Jobs Act Percent 1 | 80% | |||
Tax Receivable Agreement [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Deferred Tax Assets Liabilities Net | $ 55,800 | $ 45,600 | ||
Common Class B [Member] | Tax Receivable Agreement [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Income tax benefit percentage attributable to exchange for class A common stock | 85% | |||
Zevia LLC [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Economic interest percentage | 68.70% | 53.40% |
Income Taxes and Tax Receivab_4
Income Taxes and Tax Receivable Agreement - Schedule of Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current | ||
Federal | $ 0 | $ 0 |
State | 65 | 34 |
Total | 65 | 34 |
Deferred | ||
Federal | 0 | 0 |
State | 0 | 0 |
Total | 0 | 0 |
Provision for income taxes | $ 65 | $ 34 |
Income Taxes and Tax Receivab_5
Income Taxes and Tax Receivable Agreement - Summary of Reconciliation Between the Effective Tax Rate and the Applicable U.S. Federal Statutory Income Tax Rate (Details) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Tax computed at federal statutory rate | 21% | 21% |
State tax, net of federal tax benefit | 0.80% | 1.70% |
Permanent items and other | (0.80%) | 0% |
Non-controlling interests | (5.80%) | (10.00%) |
Equity-based compensation | (9.20%) | (3.70%) |
Valuation allowance | (6.10%) | (9.00%) |
Effective Tax Rate | (0.10%) | 0% |
Income Taxes and Tax Receivab_6
Income Taxes and Tax Receivable Agreement - Schedule of Components that Comprise Net Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets | |||
Investment in Zevia LLC | $ 53,427 | $ 47,955 | |
Net operating loss carryforwards | 15,970 | 4,144 | |
Equity-based compensation | 3,161 | 6,840 | |
Other temporary differences | 104 | 1 | |
Total deferred tax assets | 72,662 | 58,940 | |
Valuation allowance for deferred tax assets | (72,662) | (58,940) | $ 0 |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes and Tax Receivab_7
Income Taxes and Tax Receivable Agreement - Summary of Activity Related to Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||
Balance, beginning of the year | $ 58,940 | $ 0 |
Increases related to current year positions | 13,722 | 58,940 |
Balance, end of the year | $ 72,662 | $ 58,940 |
Unaudited Quarterly Financial I
Unaudited Quarterly Financial Information - Summary of Unaudited Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |||||||||
Net sales | $ 35,366 | $ 44,239 | $ 45,542 | $ 38,034 | $ 34,170 | $ 38,956 | $ 34,352 | $ 30,694 | $ 163,181 | $ 138,172 | ||||||||
Gross Profit | 15,653 | 19,168 | 19,321 | [1] | 15,879 | [1] | 14,797 | [2] | 17,767 | [2] | 16,673 | [2] | 14,704 | [2] | 70,021 | 63,941 | ||
Loss from operations | (6,349) | (9,221) | (14,743) | (17,555) | (37,464) | [3] | (49,498) | [3] | (707) | 243 | (47,868) | (87,426) | ||||||
Loss before income taxes | (6,127) | (9,195) | (14,787) | (17,473) | (37,420) | [3] | (49,711) | [3] | (749) | 247 | (47,582) | (87,633) | ||||||
Net loss and comprehensive loss | (6,170) | (9,196) | (14,796) | (17,485) | (37,404) | (49,761) | (749) | 247 | (47,647) | (87,667) | ||||||||
Net loss attributable to Zevia PBC | $ (4,385) | $ (7,484) | $ (11,090) | $ (10,898) | $ (20,163) | $ (25,823) | $ 0 | $ 0 | $ (33,857) | $ (45,986) | ||||||||
Basic earnings per share | $ (0.09) | $ (0.16) | [4] | $ (0.27) | [4] | $ (0.28) | [4] | $ (0.59) | $ (0.75) | $ (0.81) | $ (1.33) | [5] | ||||||
Diluted earnings per share | $ (0.09) | $ (0.16) | [4] | $ (0.27) | [4] | $ (0.28) | [4] | $ (0.59) | $ (0.75) | $ (0.81) | $ (1.33) | [5] | ||||||
Weighted average common units outstanding, basic | 47,368,849 | 45,938,507 | [4] | 42,051,987 | [4] | 38,371,713 | [4] | 34,450,409 | 34,440,982 | 43,469,383 | 34,450,409 | |||||||
Weighted average common units outstanding, diluted | 47,368,849 | 45,938,507 | [4] | 42,051,987 | [4] | 38,371,713 | [4] | 34,450,409 | 34,440,982 | 43,469,383 | 34,450,409 | |||||||
Common Class A [Member] | ||||||||||||||||||
Net loss and comprehensive loss | $ (35,155) | $ (45,986) | ||||||||||||||||
Basic earnings per share | $ (0.81) | $ (1.33) | [6] | |||||||||||||||
Diluted earnings per share | $ (0.81) | $ (1.33) | [6] | |||||||||||||||
Weighted average common units outstanding, basic | 41,739,061 | 34,450,409 | ||||||||||||||||
Weighted average common units outstanding, diluted | 43,469,383 | 34,450,409 | ||||||||||||||||
[1] The Company reclassified $ 1.3 million and $ 1.9 million of expenses in the first and second quarter of 2022, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. The Company reclassified $ 0.5 million, $ 0.4 million, $ 0.8 million, and $ 1.0 million of expenses in the first, second, third, and fourth quarter of 2021, respectively, which were previously recorded as cost of goods sold to selling and marketing expenses to conform to the current presentation. Net loss in the second half of 2021 increased primarily due to $ 45.7 million and $ 31.9 million, respectively, of equity-based compensation in the third and fourth quarter of 2021 relating to restricted stock unit awards and phantom stock awards that generally vest over six months following the IPO. The Company has revised basic and diluted earnings per share amounts for the first, second, and third quarters of 2022 to include the impact of vested but unreleased restricted stock units which were previously excluded from the respective basic and diluted earnings per share computations. The impact of this immaterial correction was to decrease both basic and diluted loss per share by $0 .02 , $ 0.01 , and $ 0.01 , respectively, from the amounts previously reported in the Company’s Form 10-Q for each of the respective first, second, and third quarters of 2022. (1) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the reorganization transactions and initial public offering (see Note 16). Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the Reorganization Transactions and IPO. |
Unaudited Quarterly Financial_2
Unaudited Quarterly Financial Information - Summary of Unaudited Quarterly Financial Data (Parenthetical) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |||||
Selling and marketing | $ 52,869 | $ 45,130 | ||||||||||||
Basic earnings per share | $ (0.09) | $ (0.16) | [1] | $ (0.27) | [1] | $ (0.28) | [1] | $ (0.59) | $ (0.75) | $ (0.81) | $ (1.33) | [2] | ||
Diluted earnings per share | $ (0.09) | (0.16) | [1] | $ (0.27) | [1] | $ (0.28) | [1] | $ (0.59) | $ (0.75) | $ (0.81) | $ (1.33) | [2] | ||
Equity-based compensation | $ 31,900 | $ 45,700 | $ 26,880 | $ 77,724 | ||||||||||
Restatement Adjustment [Member] | ||||||||||||||
Selling and marketing | $ 1,900 | $ 1,300 | $ 800 | $ 1,000 | $ 400 | $ 500 | $ 2,727 | |||||||
Basic earnings per share | 0.01 | $ 0.01 | $ 0.02 | |||||||||||
Diluted earnings per share | $ 0.01 | $ 0.01 | $ 0.02 | |||||||||||
[1] The Company has revised basic and diluted earnings per share amounts for the first, second, and third quarters of 2022 to include the impact of vested but unreleased restricted stock units which were previously excluded from the respective basic and diluted earnings per share computations. The impact of this immaterial correction was to decrease both basic and diluted loss per share by $0 .02 , $ 0.01 , and $ 0.01 , respectively, from the amounts previously reported in the Company’s Form 10-Q for each of the respective first, second, and third quarters of 2022. (1) Represents earnings per share of Class A common stock and weighted-average shares of Class A common stock outstanding for the period from July 22,2021 through December 31, 2021, the period following the reorganization transactions and initial public offering (see Note 16). |