Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 11, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-40812 | |
Entity Registrant Name | THOUGHTWORKS HOLDING, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-2668392 | |
Entity Address, Address Line One | 200 East Randolph Street, 25th Floor | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60601 | |
City Area Code | 312 | |
Local Phone Number | 373-1000 | |
Title of 12(b) Security | Common Stock, $0.001 par value | |
Trading Symbol | TWKS | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 305,117,043 | |
Entity Central Index Key | 0001866550 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 |
Current assets: | |||
Cash and cash equivalents | $ 452,810 | $ 490,841 | |
Trade receivables, net of allowance for doubtful accounts of $9,085 and $10,385, respectively | 118,420 | 113,183 | |
Unbilled receivables | 126,517 | 88,340 | |
Prepaid expenses | 11,086 | 9,442 | |
Other current assets | 40,402 | 9,960 | |
Total current assets | 749,235 | 711,766 | |
Property and equipment, net | 35,038 | 26,347 | |
Intangibles and other assets: | |||
Goodwill | 346,831 | 318,151 | |
Intangible assets, net | 401,820 | 402,055 | |
Other non-current assets | 17,688 | 16,904 | |
Total assets | 1,550,612 | 1,475,223 | |
Current liabilities: | |||
Accounts payable | 6,060 | 4,349 | |
Long-term debt - current | 7,150 | 4,565 | |
Income taxes payable | 15,840 | 11,032 | |
Accrued compensation | 74,085 | 49,896 | |
Deferred revenue | 9,054 | 11,720 | |
Value-added tax and sales tax payable | 3,584 | 6,846 | |
Accrued expenses | 65,122 | 29,749 | |
Total current liabilities | 180,895 | 118,157 | |
Long-term debt, less current portion | 597,004 | 435,192 | |
Deferred tax liabilities | 86,329 | 98,310 | |
Other long-term liabilities | 17,051 | 16,052 | |
Total liabilities | 881,279 | 667,711 | |
Commitments and contingencies (See Note 9) | |||
Redeemable, convertible preferred stock: | |||
Redeemable Convertible Preferred Stock | 0 | 322,800 | $ 0 |
Stockholders’ equity: | |||
Convertible preferred stock, $0.001 par value; 100,000,000 and zero shares authorized, zero issued and outstanding at September 30, 2021 and December 31, 2020, respectively | 0 | ||
Common Stock | 356 | ||
Treasury stock, 50,985,571 and 572,711 shares at September 30, 2021 and December 31, 2020, respectively | (629,424) | (1,608) | |
Additional paid-in capital | 1,316,075 | 381,172 | |
Accumulated other comprehensive loss | (10,591) | (1,589) | |
Retained (deficit) earnings | (7,083) | 106,458 | |
Total stockholders' equity | 669,333 | 484,712 | $ 448,485 |
Total liabilities, redeemable convertible preferred stock and stockholders' equity | $ 1,550,612 | 1,475,223 | |
Series A, Redeemable Convertible Preferred Stock | |||
Redeemable, convertible preferred stock: | |||
Redeemable Convertible Preferred Stock | 322,800 | ||
Series B, Redeemable Convertible Preferred Stock | |||
Redeemable, convertible preferred stock: | |||
Redeemable Convertible Preferred Stock | 0 | ||
Common Class A | |||
Stockholders’ equity: | |||
Common Stock | 272 | ||
Common Class B | |||
Stockholders’ equity: | |||
Common Stock | 5 | ||
Common Class C | |||
Stockholders’ equity: | |||
Common Stock | $ 2 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Trade receivables, allowance for doubtful accounts | $ 9,085 | $ 10,385 |
Redeemable, convertible preferred stock, shares issued (in shares) | 0 | |
Redeemable, convertible preferred stock, shares outstanding (in shares) | 0 | 23,493,546 |
Preferred stock, par value (in dollars per share) | $ 0.001 | |
Preferred stock, shares authorized (in shares) | 100,000,000 | |
Preferred stock, shares issued (in shares) | 0 | |
Preferred stock, shares outstanding (in shares) | 0 | |
Common stock, par value (in dollars per share) | $ 0.001 | |
Common stock, shares authorized (in shares) | 1,000,000,000 | |
Common stock, shares issued (in shares) | 356,102,614 | |
Common stock, shares outstanding (in shares) | 305,117,043 | |
Treasury stock (in shares) | 50,985,571 | 572,711 |
Series A, Redeemable Convertible Preferred Stock | ||
Redeemable, convertible preferred stock, par value (in dollars per share) | $ 0.001 | |
Redeemable, convertible preferred stock, shares authorized (in shares) | 217,902,632 | |
Redeemable, convertible preferred stock, shares issued (in shares) | 23,493,546 | |
Redeemable, convertible preferred stock, shares outstanding (in shares) | 23,493,546 | |
Series B, Redeemable Convertible Preferred Stock | ||
Redeemable, convertible preferred stock, par value (in dollars per share) | $ 0.001 | |
Redeemable, convertible preferred stock, shares authorized (in shares) | 0 | |
Redeemable, convertible preferred stock, shares issued (in shares) | 0 | |
Redeemable, convertible preferred stock, shares outstanding (in shares) | 0 | |
Common Class A | ||
Common stock, par value (in dollars per share) | $ 0.001 | |
Common stock, shares authorized (in shares) | 416,194,027 | |
Common stock, shares issued (in shares) | 272,054,182 | |
Common stock, shares outstanding (in shares) | 272,054,182 | |
Common Class B | ||
Common stock, par value (in dollars per share) | $ 0.001 | |
Common stock, shares authorized (in shares) | 116,577,908 | |
Common stock, shares issued (in shares) | 5,002,488 | |
Common stock, shares outstanding (in shares) | 4,474,514 | |
Common Class C | ||
Common stock, par value (in dollars per share) | $ 0.001 | |
Common stock, shares authorized (in shares) | 55,565,172 | |
Common stock, shares issued (in shares) | 1,838,757 | |
Common stock, shares outstanding (in shares) | 1,794,020 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME AND COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenues | $ 285,051 | $ 196,549 | $ 783,145 | $ 597,082 |
Operating expenses: | ||||
Cost of revenues | 183,945 | 114,849 | 471,047 | 351,750 |
Selling, general and administrative expenses | 113,019 | 42,073 | 248,366 | 139,498 |
Depreciation and amortization | 4,173 | 4,343 | 13,007 | 12,587 |
Total operating expenses | 301,137 | 161,265 | 732,420 | 503,835 |
(Loss) income from operations | (16,086) | 35,284 | 50,725 | 93,247 |
Other (expense) income: | ||||
Interest expense | (6,734) | (6,016) | (20,316) | (19,833) |
Net realized and unrealized foreign currency (loss) gain | (1,934) | 938 | (3,608) | 2,369 |
Other income (expense), net | 162 | 12 | 306 | 139 |
Total other expense | (8,506) | (5,066) | (23,618) | (17,325) |
(Loss) income before income taxes | (24,592) | 30,218 | 27,107 | 75,922 |
Income tax expense | 643 | 8,336 | 15,605 | 16,243 |
Net (loss) income | (25,235) | 21,882 | 11,502 | 59,679 |
Other comprehensive (loss) income, net of tax: | ||||
Foreign currency translation adjustments | (7,109) | 9,940 | (9,002) | (7,321) |
Comprehensive (loss) income | $ (32,344) | $ 31,822 | $ 2,500 | $ 52,358 |
Net (loss) earnings per common share: | ||||
Basic (loss) earnings per common share (in USD per share) | $ (0.10) | $ 0.08 | $ (0.20) | $ 0.21 |
Diluted (loss) earnings per common share (in USD per share) | $ (0.10) | $ 0.08 | $ (0.20) | $ 0.21 |
Weighted average shares outstanding: | ||||
Weighted average shares outstanding, basic (in shares) | 241,351,052 | 278,218,732 | 237,121,811 | 278,202,291 |
Weighted average shares outstanding, diluted (in shares) | 241,351,052 | 285,073,748 | 237,121,811 | 284,165,048 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | IPO | Common Stock | Common StockIPO | Treasury | Additional Paid-In Capital | Additional Paid-In CapitalIPO | Accumulated Other Comprehensive Loss | Retained (Deficit) Earnings |
Beginning balance (in shares) at Dec. 31, 2019 | 0 | ||||||||
Beginning balance at Dec. 31, 2019 | $ 0 | ||||||||
Ending balance (in shares) at Sep. 30, 2020 | 0 | ||||||||
Ending balance at Sep. 30, 2020 | $ 0 | ||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 278,193,711 | 572,711 | |||||||
Beginning balance at Dec. 31, 2019 | 394,988 | $ 279 | $ (1,608) | $ 379,209 | $ (10,067) | $ 27,175 | |||
Increase (Decrease in Stockholders' Equity [Roll Forward] | |||||||||
Net (loss) income | 59,679 | 59,679 | |||||||
Other comprehensive income (loss), net of tax | (7,321) | (7,321) | |||||||
Issuance of common stock on exercise of options , net of withholding taxes (in shares) | 31,767 | ||||||||
Issuance of common stock on exercise of options, net of withholding taxes | 73 | 73 | |||||||
Stock-based compensation expense | 1,066 | 1,066 | |||||||
Ending balance (in shares) at Sep. 30, 2020 | 278,225,478 | 572,711 | |||||||
Ending balance at Sep. 30, 2020 | $ 448,485 | $ 279 | $ (1,608) | 380,348 | (17,388) | 86,854 | |||
Beginning balance (in shares) at Jun. 30, 2020 | 0 | ||||||||
Beginning balance at Jun. 30, 2020 | $ 0 | ||||||||
Ending balance (in shares) at Sep. 30, 2020 | 0 | ||||||||
Ending balance at Sep. 30, 2020 | $ 0 | ||||||||
Beginning balance (in shares) at Jun. 30, 2020 | 278,198,070 | 572,711 | |||||||
Beginning balance at Jun. 30, 2020 | 416,308 | $ 279 | $ (1,608) | 379,993 | (27,328) | 64,972 | |||
Increase (Decrease in Stockholders' Equity [Roll Forward] | |||||||||
Net (loss) income | 21,882 | 21,882 | |||||||
Other comprehensive income (loss), net of tax | 9,940 | 9,940 | |||||||
Issuance of common stock on exercise of options , net of withholding taxes (in shares) | 27,408 | ||||||||
Issuance of common stock on exercise of options, net of withholding taxes | 63 | 63 | |||||||
Stock-based compensation expense | 292 | 292 | |||||||
Ending balance (in shares) at Sep. 30, 2020 | 278,225,478 | 572,711 | |||||||
Ending balance at Sep. 30, 2020 | $ 448,485 | $ 279 | $ (1,608) | 380,348 | (17,388) | 86,854 | |||
Beginning balance (in shares) at Dec. 31, 2020 | 23,493,546 | ||||||||
Beginning balance at Dec. 31, 2020 | $ 322,800 | ||||||||
Redeemable, Convertible Preferred Stock | |||||||||
Issuance of Redeemable Convertible Preferred Stock, net of issuance costs (in shares) | 35,996,412 | ||||||||
Issuance of Redeemable Convertible Preferred Stock, net of issuance costs | $ 503,222 | ||||||||
Conversion of redeemable convertible preferred stock on exercise of options (in shares) | (59,489,958) | ||||||||
Conversion of redeemable convertible preferred stock to common stock | $ (826,022) | ||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | ||||||||
Ending balance at Sep. 30, 2021 | $ 0 | ||||||||
Beginning balance (in shares) at Dec. 31, 2020 | 278,322,716 | 572,711 | |||||||
Beginning balance at Dec. 31, 2020 | 484,712 | $ 279 | $ (1,608) | 381,172 | (1,589) | 106,458 | |||
Increase (Decrease in Stockholders' Equity [Roll Forward] | |||||||||
Net (loss) income | 11,502 | 11,502 | |||||||
Other comprehensive income (loss), net of tax | (9,002) | (9,002) | |||||||
Issuance of common stock (in shares) | 133,313 | 16,429,964 | |||||||
Issuance of common stock | 1,873 | $ 314,716 | $ 16 | 1,873 | $ 314,700 | ||||
Conversion of redeemable convertible preferred stock to common stock (in shares) | 59,489,958 | ||||||||
Conversion of redeemable convertible preferred stock to common stock | 826,022 | $ 60 | 825,962 | ||||||
Issuance of common stock on exercise of options , net of withholding taxes (in shares) | 1,153,952 | ||||||||
Issuance of common stock on exercise of options, net of withholding taxes | (885) | $ 1 | (886) | ||||||
Dividends | (325,012) | (279,191) | (45,821) | ||||||
Tender Offer (in shares) | (50,412,860) | 50,412,860 | |||||||
Tender Offer | (717,429) | $ (627,816) | (10,391) | (79,222) | |||||
Stock-based compensation expense | 82,836 | 82,836 | |||||||
Ending balance (in shares) at Sep. 30, 2021 | 305,117,043 | 50,985,571 | |||||||
Ending balance at Sep. 30, 2021 | $ 669,333 | $ 356 | $ (629,424) | 1,316,075 | (10,591) | (7,083) | |||
Beginning balance (in shares) at Jun. 30, 2021 | 59,489,958 | ||||||||
Beginning balance at Jun. 30, 2021 | $ 826,022 | ||||||||
Redeemable, Convertible Preferred Stock | |||||||||
Conversion of redeemable convertible preferred stock on exercise of options (in shares) | (59,489,958) | ||||||||
Conversion of redeemable convertible preferred stock to common stock | $ (826,022) | ||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | ||||||||
Ending balance at Sep. 30, 2021 | $ 0 | ||||||||
Beginning balance (in shares) at Jun. 30, 2021 | 228,080,650 | 50,985,571 | |||||||
Beginning balance at Jun. 30, 2021 | (510,690) | $ 279 | $ (629,424) | 103,785 | (3,482) | 18,152 | |||
Increase (Decrease in Stockholders' Equity [Roll Forward] | |||||||||
Net (loss) income | (25,235) | (25,235) | |||||||
Other comprehensive income (loss), net of tax | (7,109) | (7,109) | |||||||
Issuance of common stock (in shares) | 16,429,964 | ||||||||
Issuance of common stock | $ 314,716 | $ 16 | $ 314,700 | ||||||
Conversion of redeemable convertible preferred stock to common stock (in shares) | 59,489,958 | ||||||||
Conversion of redeemable convertible preferred stock to common stock | 826,022 | $ 60 | 825,962 | ||||||
Issuance of common stock on exercise of options , net of withholding taxes (in shares) | 1,116,471 | ||||||||
Issuance of common stock on exercise of options, net of withholding taxes | (971) | $ 1 | (972) | ||||||
Stock-based compensation expense | 72,600 | 72,600 | |||||||
Ending balance (in shares) at Sep. 30, 2021 | 305,117,043 | 50,985,571 | |||||||
Ending balance at Sep. 30, 2021 | $ 669,333 | $ 356 | $ (629,424) | $ 1,316,075 | $ (10,591) | $ (7,083) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (Parenthetical) $ in Millions | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Redeemable, Convertible Preferred Stock, issuance costs | $ 11.8 |
IPO | |
Common Stock, issuance costs | $ 30.3 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Cash flows from operating activities: | ||
Net income | $ 11,502 | $ 59,679 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization expense | 21,702 | 19,327 |
Bad debt provision | (611) | 6,713 |
Stock-based compensation expense | 82,836 | 1,066 |
Unrealized foreign currency exchange loss | 3,912 | 165 |
Other operating activities, net | (10,849) | 4,863 |
Changes in operating assets and liabilities: | ||
Trade receivables | (3,960) | 36,830 |
Unbilled receivables | (39,670) | (30,812) |
Prepaid expenses | (1,610) | (5,131) |
Other assets | (27,537) | 825 |
Accounts payable | 1,602 | (1,126) |
Accrued expenses and other liabilities | 58,182 | 6,844 |
Net cash provided by operating activities | 95,499 | 99,243 |
Cash flows from investing activities: | ||
Purchase of property and equipment | (21,504) | (9,005) |
Proceeds from disposal of fixed assets | 375 | 101 |
Acquisition of businesses, net of cash acquired | (44,759) | 0 |
Net cash used in investing activities | (65,888) | (8,904) |
Cash flows from financing activities: | ||
Proceeds from initial public offering, net of issuance costs and underwriting discounts | 314,716 | 0 |
Payments of obligations of long-term debt | (234,921) | (3,424) |
Payments of debt issuance costs | (7,098) | (111) |
Proceeds from borrowings on revolving credit facility | 0 | 29,000 |
Payments on revolving credit facility | 0 | (29,000) |
Proceeds from borrowings on long-term debt | 401,285 | 0 |
Proceeds from issuance of common stock on exercise of options, net of employee tax withholding | (885) | 73 |
Shares and options purchased under Tender offer | (701,960) | 0 |
Proceeds from issuance of common stock | 1,873 | 0 |
Dividends paid | (315,003) | 0 |
Other financing activities, net | 1,317 | 105 |
Net cash used in financing activities | (37,454) | (3,357) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (3,394) | (574) |
Net (decrease) increase in cash, cash equivalents and restricted cash | (11,237) | 86,408 |
Cash, cash equivalents and restricted cash at beginning of the period | 492,199 | 57,156 |
Cash, cash equivalents and restricted cash at end of the period | 480,962 | 143,564 |
Supplemental disclosure of cash flow information: | ||
Interest paid | 18,736 | 18,364 |
Income taxes paid | 21,307 | 9,470 |
Withholding taxes payable | 34,539 | 0 |
Supplemental disclosures of non-cash investing and financing activities: | ||
Conversion of convertible preferred stock to common stock | 826,022 | 0 |
Net settlement on exercise of shares | 3,611 | 0 |
Series A, Redeemable Convertible Preferred Stock | ||
Cash flows from financing activities: | ||
Proceeds from issuance of Redeemable Convertible Preferred Stock, net of issuance costs | 380,994 | 0 |
Series B, Redeemable Convertible Preferred Stock | ||
Cash flows from financing activities: | ||
Proceeds from issuance of Redeemable Convertible Preferred Stock, net of issuance costs | $ 122,228 | $ 0 |
Business and Summary of Signifi
Business and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Summary of Significant Accounting Policies | Business and Summary of Significant Accounting Policies Thoughtworks Holding, Inc., formerly known as Turing Holding Corp., (together with its subsidiaries, the “Company”) develops, implements, and services complex enterprise application software, provides business technology consulting, and licenses technology practitioner tools which are used for software development. The Company conducts business in Australia, Brazil, Canada, Chile, China, Ecuador, Finland, Germany, Hong Kong, India, Italy, the Netherlands, Romania, Singapore, Spain, Thailand, the United Kingdom and the United States. Thoughtworks Holding, Inc. is the ultimate parent holding company of Thoughtworks, Inc. among other subsidiaries. Initial Public Offering The Company’s registration statement on Form S-1 related to its initial public offering (“IPO”) was declared effective on September 14, 2021 and the Company’s common stock began trading on the Nasdaq Global Select Market on September 15, 2021. The Company's final prospectus (the “IPO Prospectus”) was filed with the SEC on September 16, 2021. On September 17, 2021 (the “IPO Closing Date”), the Company closed its IPO pursuant to which an aggregate of 42,368,421 shares of its common stock were sold, which includes the issuance and sale of 16,429,964 shares of the Company's common stock, the sale by selling stockholders of 20,412,142 shares of the Company's common stock, and the full exercise of the underwriters' option to purchase 5,526,315 additional shares of common stock from certain of the selling stockholders, at the IPO price of $21.00 per share. The Company received net proceeds of $314.7 million, after deducting the underwriting discounts and commissions and other offering expenses of approximately $30.3 million. Prior to the completion of the IPO, all shares of the Company's Class A, Class B and Class C common stock then outstanding were converted into 5,259,163 shares of common stock on a 1-for-1 basis, and upon the completion of the IPO, all 1,365,058 shares of the Company’s outstanding Series A and B redeemable convertible preferred stock converted into an equivalent number of shares of common stock on a 1-for-1 basis. Additionally, after the conversion described above and prior to the completion of the IPO, the Company effected an approximate 43.6-for-1 split of each outstanding share of common stock (the "Stock Split"). All share and per share information has been retroactively adjusted to effect the Stock Split for all periods presented, except where otherwise noted. Post-IPO, offering expenses, which consist of direct incremental legal, accounting, and consulting fees relating to the IPO, were recorded as equity issuance costs as a reduction to additional paid-in capital on the condensed consolidated statement of stockholders' equity. These offering expenses, net of reimbursement received from the underwriters upon completion of the IPO, totale d approximately $30.3 million, of which $19.0 million related to underwriting discounts and commissions and $11.3 million related to offering expenses, as of September 30, 2021. Basis of Presentation and Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of Thoughtworks Holding, Inc. and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements should be read in conjunction with the condensed consolidated financial statements and notes included in the Company’s IPO Prospectus. Preparation of Financial Statements and Use of Estimates The preparation of the unaudited condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020. The preparation of these condensed consolidated financial statements is in conformity with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. On an ongoing basis, the Company evaluates its estimates, including those related to allowance for doubtful accounts, valuation and impairment of goodwill and long-lived assets, income taxes, accrued bonus, contingencies, stock-based compensation, including the underlying deemed fair value of common stock (prior to the completion of the IPO), and litigation costs. The Company bases its estimates on historical experience and on other assumptions that its management believes are reasonable under the circumstances. These estimates form the basis for making judgments about the carrying value of assets and liabilities when those values are not readily apparent from other sources. Actual results can differ from those estimates, and such differences may be material to the condensed consolidated financial statements. Operating results for the interim periods are not necessarily indicative of results that may be expected to occur for the entire year. In management’s opinion, all adjustments considered necessary for a fair presentation of the accompanying unaudited condensed consolidated financial statements have been included, and all adjustments are of a normal and recurring nature. Segments The Company operates as one operating segment. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and assess performance. While the Company has offerings in multiple modern digital businesses and operates in multiple countries, the Company’s business operates in one operating segment because most of the Company's service offerings are delivered and supported on a global basis, most of the Company's service offerings are deployed in a nearly identical way, and the Company’s CODM evaluates the Company’s financial information and resources and assesses the performance of these resources on a consolidated basis. Long-Lived Assets The North America geographic region encompasses the Company’s country of domicile (United States) and Canada, of which long-lived assets including property and equipment, net of depreciation, are principally held within the United States. The United States comprised $7.0 million, or 20.0%, and $4.6 million, or 17.4%, of the Company’s long-lived assets as of September 30, 2021 and December 31, 2020, respectively. Canadian long-lived assets were determined to be immaterial given property, and equipment was less than 10% of the Company's long-lived assets as of September 30, 2021 and December 31, 2020. The Company holds material long-lived assets in the foreign geographic locations of Brazil, China, and India of $5.8 million, $8.1 million, and $7.6 million as of September 30, 2021, respectively, compared to $2.8 million, $7.6 million, and $5.3 million as of December 31, 2020, respectively. Long-lived assets in all other foreign geographic locations, including Canada, totaled $6.5 million and $6.0 million as of September 30, 2021 and December 31, 2020, respectively. Stock-Based Compensation The Company accounts for employee and non-employee equity-based compensation in accordance with ASC 718, Compensation – Stock Compensation . Accordingly, compensation expense for employee and non-employee services received in exchange for equity awards is based on the grant date fair value of those awards and is recognized over the requisite service period for the respective award. Prior to the IPO, the fair market value of the Company’s common stock was determined by the estimated fair market value of the Company’s common stock at the time of grant. Upon the completion of the IPO, the Company uses the market closing price of its common stock on the date of grant to determine the fair market value of the common stock, or if there is no market closing price on the date of grant, the closing price reported on the most recent trading date on Nasdaq. The Company’s equity-based awards issued to employees include stock option awards issued by the Company, which vest based on either time or the achievement of certain performance and market conditions. The Company records forfeitures as they occur. Compensation expense resulting from time vesting based awards will be recognized in the Company’s consolidated statement of operations and comprehensive income (loss), primarily within general and administrative expenses, at the grant date fair value over the requisite service period (typically one Common Stock Valuation Prior to the IPO Closing Date Prior to the IPO Closing Date, due to the absence of an active market for the Company’s common stock, the Company utilized methodologies in accordance with the framework of the American Institute of Certified Public Accountants’ Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of common stock. The valuation methodology included estimates and assumptions that required the Company’s judgment. These estimates and assumptions included a number of objective and subjective factors, including external market conditions affecting the industry sector, and the likelihood of achieving a liquidity event, such as an IPO, reverse merger or sale. Significant changes to the key assumptions used in the valuations resulted in different fair values of common stock at each valuation date. The Company’s equity-based awards also include restricted stock units ("RSUs"), and the fair value of each RSU is based on the fair value of the Company’s common stock on the date of grant. Refer to Note 11, Stock-Based Compensation , for more information on equity-based awards and the related activity that occurred in connection with the IPO. Restricted Cash Restricted cash is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Restricted cash is restricted as to withdrawal or use. The Company has restricted cash held on deposit at various financial institutions. The amounts are held in escrow for income tax withholdings, to secure bank guarantees of amounts related to government requirements, and collateral for a corporate credit card. A reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheet is as follows (in thousands): As of September 30, 2021 As of December 31, 2020 Cash and cash equivalents $ 452,810 $ 490,841 Restricted cash included in other current assets 26,827 — Restricted cash included in other non-current assets 1,325 1,358 Total cash, cash equivalents, and restricted cash $ 480,962 $ 492,199 Recently Adopted Accounting Standards In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2018-13, Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement , which amends Accounting Standards Codification (“ASC”) 820, Fair Value Measurement . This ASU modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The effective date is the first quarter of fiscal year 2020, with early adoption permitted for the removed disclosures and delayed adoption until fiscal year 2020 permitted for the new disclosures. The removed and modified disclosures were adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The adoption of ASU 2018-13 did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customers Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract . ASU 2018-15 is intended to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The ASU is effective for annual reporting periods beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. Early adoption is permitted. In the third quarter of 2021, the Company early adopted ASU 2018-15 and this adoption did not have a material impact on the Company’s condensed consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) : Simplifying the Accounting for Income Taxes , as part of its simplification initiative to reduce the cost and complexity in accounting for income taxes. ASU 2019-12 removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of GAAP. The guidance became effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. The adoption of ASU 2019-12 did not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which amends existing accounting standards for lease accounting and requires lessees to recognize virtually all their leases on the balance sheet by recording a right-of-use asset and a lease liability (for other than short term leases). The Company is in the preliminary stages of gathering data and assessing the impact of the new lease standard. The Company anticipates that the adoption of this standard will materially affect the consolidated balance sheet and may require changes to the processes used to account for leases. The Company is currently in the process of evaluating the impact of the adoption of Topic 842 on the condensed consolidated financial statements and will adopt this new standard in the fiscal year beginning January 1, 2022, based on its status as an emerging growth company. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which amends the current accounting guidance and requires the measurement of all expected losses based on historical experience, current conditions, and reasonable and supportable forecasts, or a current expected credit loss (“CECL”) model. For trade receivables, loans, and other financial instruments, companies will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable. In November 2019, the FASB issued ASU 2019-10 which delayed the effective date for the CECL standard. This guidance and related amendments is effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently assessing the impact of this ASU on the condensed consolidated financial statements and will adopt this new standard in the fiscal year beginning January 1, 2023, based on its status as an emerging growth company. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) : Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides temporary optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions to ease the financial reporting burdens related to the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. The optional amendments are effective as of March 12, 2020 through December 31, 2022. The Company is currently assessing the impact of this ASU on the condensed consolidated financial statements and will adopt this new standard in the fiscal year beginning January 1, 2023 based on its status as an emerging growth company. Concentration of Credit Risk and Other Risks and Uncertainties Revenue generated from the Company's operations outside of the United States for the three and nine months ended September 30, 2021 was 66% and 65%, respectively, and for the three and nine months ended September 30, 2020 was 62% and 60%, respectively. As of September 30, 2021 and December 31, 2020, approximately 71% and 74%, respectively, of trade accounts receivable and unbilled accounts receivable was due from customers located outside the United States. At September 30, 2021 and December 31, 2020, the Company had net fixed assets of $28.0 million and $21.8 million, respectively, outside the United States. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The Company disaggregates revenues from contracts with customers by both geographic customer location and revenue contract types. Geographic customer location is pertinent to understanding the Company's revenues, as the Company generates its revenues from providing professional services to customers in various regions across the world. Revenue contract types are differentiated by the type of pricing structure for customer contracts, which is predominantly time-and-materials, but also includes fixed price contracts. Disaggregation of Revenues The following tables present the disaggregation of the Company’s revenues by customer location for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended September 30, 2021 2020 Customer Location: North America (1) $ 103,769 $ 76,649 APAC (2) 98,756 64,457 Europe (3) 69,522 46,623 LATAM 13,004 8,820 Revenues $ 285,051 $ 196,549 (1) North America encompasses the Company’s country of domicile (United States) and Canada, of which revenue is principally generated within the United States. During the three months ended September 30, 2021 and September 30, 2020, the United States represented 33.9%, or $96.5 million, and 37.3%, or $73.4 million, of the Company’s total revenues, respectively. Canadian operations were determined to be immaterial given the revenues generated from such operations as a percentage of total North America revenues was less than 10% for the three months ended September 30, 2021 and September 30, 2020. (2) During the three months ended September 30, 2021, Australia, which is included in the Asia-Pacific region ("APAC"), represented 10.9%, or $31.0 million, of the Company’s total revenues. During the three months ended September 30, 2021, the revenues generated in China as a percentage of the Company’s total revenues was less than 10%. For the three months ended September 30, 2020, the revenues generated in Australia and China represented 10.0%, or $19.7 million, and 11.9%, or $23.4 million, of the Company’s total revenues respectively. (3) During the three months ended September 30, 2021, Germany and the United Kingdom, which are included in the Europe region, represented 10.5%, or $30.0 million, and 10.5%, or $30.0 million, of the Company’s total revenues, respectively. For the three months ended September 30, 2020, the revenues generated in Germany and the United King dom represented 10.1%, or $19.8 million, and 10.6%, or $20.8 million, o f the Company’s total revenues, respectively. Other foreign countries were determined to be immaterial given the revenues generated from such operations as a percentage of the Company’s total revenues was less than 10% for the three months ended September 30, 2021 and September 30, 2020. Nine Months Ended September 30, 2021 2020 Customer Location: North America (1) $ 290,954 $ 243,797 APAC (2) 260,928 181,738 Europe (3) 196,476 143,673 LATAM 34,787 27,874 Revenues $ 783,145 $ 597,082 (1) During the nine months ended September 30, 2021 and September 30, 2020, the United States represented 35.1%, or $275.0 million, and 39.1%, or $233.5 million, of the Company’s total revenues, respectively. Canadian operations were determined to be immaterial given the revenues generated from such operations as a percentage of total North America revenues was less than 10% for the nine months ended September 30, 2021 and September 30, 2020. (2) During the nine months ended September 30, 2021, Australia, which is included in the APAC region, represented 10.7%, or $83.7 million of the Company’s total revenues. For the nine months ended September 30, 2020, the revenues generated in Australia as a percentage of the Company’s total revenues was less than 10%. (3) During the nine months ended September 30, 2021, Germany and the United Kingdom, which are included in the Europe region, represented 10.7%, or $84.2 million, and 10.7%, or $83.5 million, of the Company’s total revenues, respectively. For the nine months ended September 30, 2020, the revenues generated in Germany and the United Kingdom represented 10.0%, or $59.9 million, and 11.0%, or $65.7 million, of the Company’s total revenues, respectively. Other foreign countries were determined to be immaterial given the revenues generated from such operations as a percentage of the Company’s total revenues was less than 10% for the nine months ended September 30, 2021 and September 30, 2020. The following tables present the disaggregation of the Company’s revenues by contract type for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended September 30, 2021 2020 Contract Types: Time-and-material $ 237,533 $ 161,202 Fixed-price 47,518 35,319 Licensing — 28 Revenues $ 285,051 $ 196,549 Nine Months Ended September 30, 2021 2020 Contract Types: Time-and-material $ 635,608 $ 504,710 Fixed-price 147,537 92,029 Licensing — 343 Revenues $ 783,145 $ 597,082 Contract Balances The following table is a summary of the Company’s contract assets and contract liabilities (in thousands): As of September 30, 2021 As of December 31, 2020 Contract assets included in unbilled receivables $ 29,264 $ 19,790 Contract liabilities included in deferred revenue $ 9,054 $ 11,720 Contract liabilities represent amounts collected from the Company’s customers for revenues not yet earned. Such amounts are anticipated to be recorded as revenues when services are performed in subsequent periods. During the three and nine months ended September 30, 2021, the Company recognized $0.5 million and $11.2 million of revenues, respectively, that were included in current liabilities at December 31, 2020. During the three and nine months ended September 30, 2020, the Company recognized $0.6 million and $8.2 million of revenues that were included in current liabilities at December 31, 2019. Costs to Obtain a Customer Contract The Company incurs certain incremental costs to obtain a contract that the Company expects to recover. The Company applies a practical expedient and recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs would primarily relate to commissions paid to our account executives and are included in selling, general and administrative expenses. Transaction Price Allocated to Remaining Performance Obligations The Company does not have material future performance obligations that extend beyond one year. Accordingly, the Company has applied the optional exemption for contracts that have an original expected duration of one year or less. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions The Company acquired two businesses, Gemini Solutions LLC (“Gemini”) and Fourkind Global Oy (“Fourkind”) during the first quarter of 2021 for an aggregate gross purchase price of $46.6 million, or $44.8 million net of cash acquired of $1.8 million. These acquisitions were intended to complement existing operations and to expand into new geographic markets. The Company accounted for these acquisitions under ASC 805, Business Combinations . The goodwill identified by these acquisitions reflects the benefits expected to be derived from expansion, as well as certain operational synergies. The fair value of the net assets acquired for these businesses was determined using Level 3 inputs, for which little or no market data exists, requiring the Company to develop assumptions regarding future cash flow projections. Upon consummation of these acquisitions, each of these businesses is now wholly-owned by the Company. The results of operations for the Company include the results of these businesses from their respective dates of acquisition. The operating results subsequent to the acquisition date did not have a significant impact on the condensed consolidated financial statements of the Company. The Company's preliminary allocation of the fair value of underlying assets acquired and liabilities assumed as of the acquisition date is as follows (in thousands): Total Customer Relationship $ 11,100 Property and Equipment 259 Other assets/liabilities, net 4,228 Deferred Taxes (1,646) Goodwill 32,615 Total gross purchase pric e $ 46,556 Goodwill represents the excess of the purchase price over the fair values of assets acquired and liabilities assumed. For the Fourkind acquisition, the changes in fair value allocated to goodwill, tangible and intangible assets are not deductible for tax purposes. The Gemini acquisition was considered an asset acquisition for tax purposes; therefore, goodwill is deductible for tax purposes. As additional information is obtained about the assets and liabilities of these acquisitions during the measurement period (not to exceed one year from the date of acquisition), including the completion or finalization of asset appraisals, the Company will refine its estimates of fair value to allocate the purchase price including finalizing the impact on taxes. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The following is a summary of goodwill as of September 30, 2021 (in thousands): Total Balance as of December 31, 2019 $ 314,037 Changes due to exchange rates 4,114 Balance as of December 31, 2020 318,151 Additions due to acquisitions 32,615 Changes due to exchange rates (3,935) Balance as of September 30, 2021 $ 346,831 The following is a summary of other intangible assets as of (in thousands): September 30, 2021 December 31, 2020 Customer relationships $ 177,100 $ 166,000 Less accumulated amortization 43,177 34,122 Customer relationships 133,923 131,878 Trademark 273,000 273,000 Total intangible assets, after amortization 406,923 404,878 Changes due to exchange rates (5,103) (2,823) Intangible assets, net $ 401,820 $ 402,055 Other than indefinite-lived trademarks, the Company’s intangible assets have finite lives and, as such, are subject to amortization. Amortization expense related to these intangible assets was $3.1 million and $9.1 million for the three and nine months ended September 30, 2021 and $2.7 million and $7.9 million for the three and nine months ended September 30, 2020, respectively. As of September 30, 2021, estimated amortization expense for the next five years and thereafter is as follows (in thousands): Year Ending December 31, Total 2021 (excluding nine months ended September 30, 2021) $ 3,075 2022 12,300 2023 12,300 2024 12,300 2025 12,300 Thereafter 81,648 $ 133,923 The weighted average remaining useful life of the Company’s finite-lived intangible assets was 10.8 years as of September 30, 2021 and 11.9 years as of December 31, 2020. Impairment analysis Goodwill and indefinite lived intangible assets are tested for impairment at the reporting unit level on an annual basis and on an interim basis if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. We perform our annual goodwill impairment tests as of October 1. Finite-lived intangible assets primarily consist of customer relationships. These assets are recorded at fair value at the acquisition date and amortized on a straight-line basis over the estimated useful lives of the assets. The Company tests intangible assets with finite useful lives for impairment when a triggering event occurs, or circumstances change indicating that the fair value of the entity may be below its carrying amount. If no triggering event occurs, further impairment testing is not necessary. Long-lived assets, such as property and equipment, are reviewed for potential impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset or asset group exceeds the fair value of the asset or asset group. For the nine months ended September 30, 2021, there were no events or changes in circumstances to indicate that goodwill, intangible assets, or long-lived assets are impaired. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Historically, the Company calculated the provision for income taxes during interim reporting periods by applying an estimate of the effective tax rate for the full year to the pre-tax income or loss for the interim period, adjusting the provision for discrete tax items recorded in the period. Upon the IPO, due to the magnitude of transaction related stock-based compensation costs, the Company's forecasted pre-tax income for the year is causing the tax rate to be highly sensitive, whereby minor changes in forecasted pre-tax income generate significant variability in the estimated annual effective tax rate. This is impacting the customary relationship between income tax expense and pre-tax income in interim periods. In the third quarter of 2021, the Company concluded that it could not calculate a reliable estimate of the annual effective tax rate due to the range of potential impacts for the aforementioned forecast changes. Accordingly, the Company computed the effective tax rate for the nine month period ended September 30, 2021 using actual results, as allowed by ASC 740-270-30-18, Income Taxes-Interim Reporting . |
Redeemable, Convertible Preferr
Redeemable, Convertible Preferred Stock | 9 Months Ended |
Sep. 30, 2021 | |
Temporary Equity Disclosure [Abstract] | |
Redeemable, Convertible Preferred Stock | Redeemable, Convertible Preferred Stock In addition to common stock, prior to the IPO, securities of the Company were represented by shares of Series A Redeemable Convertible Preferred Stock, of which 2,500,000 shares of the authorized preferred stock were designated as Voting Series A Preferred Stock and 2,500,000 shares of the authorized and unissued preferred stock were designated as Non-Voting Series A Preferred Stock; shares of Series B Redeemable Convertible Preferred Stock of which 500,000 shares of the authorized preferred stock were designated as Voting Series B Preferred Stock and 500,000 shares of the authorized and unissued preferred stock were designated as Non-Voting Series B Preferred Stock (collectively referred to as “Preferred Stock”). The Company recorded all shares of Preferred Stock net of offering costs at their respective fair values on the dates of issuance. The Preferred Stock was classified outside of stockholders’ equity in the condensed consolidated financial statements, as the Preferred Stock was redeemable under circumstances that qualified as a deemed liquidation event, which would have been outside the control of the Company. In the event of certain deemed liquidation events, such as a merger, acquisition or sale of all or substantially all of the Company’s assets, the holders of Preferred Stock, then outstanding, would have been paid out an amount equal to the greater of (i) such amount payable had all the Preferred Stock converted to common stock and (ii) the original Preferred Stock issuance price subject to appropriate equitable adjustment subject to any stock dividend, stock split or other recapitalization, or if the deemed liquidation event is consummated within two years following the original issuance date the amount that would result in a preferred internal rate of return of 10% per annum. Upon the occurrence of a liquidation event, such as a voluntary or involuntary liquidation, dissolution or winding up of the Company; or a merger, consolidation or change in control, the holders of Preferred Stock, then outstanding, would have been paid out of the assets of the Company available for distribution to its shareholders before any payment is made to the holders of common stock. The holders of outstanding shares of Voting Preferred Stock would have been entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Voting Preferred Stock were convertible. The holders of shares of Non-Voting Preferred Stock would not have had any voting rights. Holders of Voting Preferred Stock would have voted together with the holders of Common Stock as a single class and on an as-converted to Common Stock basis. Shares of Preferred Stock were convertible at the holder’s option into shares of common stock, on a share-for-share basis, using a conversion rate determined by dividing the original issue price by the conversion price. The holders of Preferred Stock were entitled to receive dividends on an as-converted to common stock basis as if all outstanding shares of Preferred Stock had been converted into Class A Common Stock or Class B Common Stock (with conversion to Class B applicable only as long as any shares of Non-Voting Preferred Stock are outstanding) on the date of such event. Dividends were discretionary and were not cumulative. On April 6, 2021, the Board of Directors, through unanimous written consent, approved the Company’s declaration of a $325.0 million dividend, including $10.0 million held for withholding tax, or $50.71 per share dividend, of which $59.6 million was to preferred shareholders. The record date was April 1, 2021, with payment dates to common shareholders on or about April 6, 2021, and on April 16, 2021 to preferred shareholders, respectively. On December 23, 2020, the Company entered into a securities purchase agreement and issued 539,084 shares of Voting Series A Preferred Stock for $322.8 million, net of $7.2 million of issuance costs. In January 2021, the Company closed on security purchase agreements issuing a total of 637,098 shares of Voting Series A Preferred Stock for an aggregate amount of $381.0 million, net of $9.0 million of issuance costs. In June 2021, the Company closed on security purchase agreements issuing a total of 188,876 shares of Voting Series B Preferred Stock for an aggregate amount of $125.0 million, net of $2.8 million of issuance costs. The proceeds from the issuances on December 23, 2020 and in January 2021 were used to repurchase equity from existing shareholders. The proceeds from the issuance in June 2021 were used for general and corporate purposes. Shares presented above have not been adjusted for an approximate 43.6-for-1 stock split. Upon the completion of the IPO, all 59,489,958 shares of the Company’s outstanding redeemable convertible preferred stock, adjusted for an approximate 43.6-for-1 stock split, converted into an equivalent number of shares of common stock on a 1-for-1 basis and their carrying value of $826.0 million was reclassified into stockholders’ equity. Further, in connection with the IPO, the Company’s amended and restated certificate of incorporation became effective, which authorized the issuance of 100,000,000 shares of undesignated preferred stock with a par value of $0.001 per share with rights and preferences, including voting rights, designated from time to time by the Board of Directors. As of September 30, 2021, there were no shares of redeemable convertible preferred stock issued and outstanding. |
Tender Offer
Tender Offer | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Tender Offer | Tender Offer During the quarter ended March 31, 2021, the Board of Directors approved, and the Company completed a tender offer of common shares which was funded from the proceeds of the redeemable, convertible preferred stock offering (Note 6, Redeemable, Convertible Preferred Stock ). As a result, the Company acquired 1,156,775 shares of its common stock (1,138,537, 12,979, and 5,259 shares of the Company's former Class A, B, and C common shares, respectively). The Company also purchased and cancelled vested options from employees and directors through the tender offer. In this Note, the shares presented have not been adjusted for an approximate 43.6-for-1 stock split. Total purchases of shares and vested employee options under the tender offer approximated $720.0 million, including $19.3 million held for withholding tax. Because the price paid per share exceeded the share’s respective fair value, the Company recognized $2.7 million of additional compensation expense associated with shares and options repurchased from employees and directors, and $79.2 million as a distribution of retained earnings for the excess of price paid over fair value for those shares repurchased from non-employee securityholders. Redeemable Convertible Preferred Stock In September 2021, upon the closing of the Company's IPO, all outstanding shares of redeemable convertible preferred stock were converted into an aggregate of 1,365,058 shares of common stock. Shares presented above have not been adjusted for an approximate 43.6-for-1 stock split. Further, in connection with the IPO, the Company’s amended and restated certificate of incorporation became effective, which authorized the issuance of 100,000,000 shares of undesignated preferred stock with a par value of $0.001 per share with rights and preferences, including voting rights, designated from time to time by the Board of Directors. Common Stock In connection with the IPO, all classes of shares of the Company's common stock then outstanding were converted into 5,259,163 shares of common stock on a one-to-one basis. As a result, the securities of the Company are represented by shares of common stock with a par value of $0.001 per share. Each share of common stock is entitled to one vote. With respect to payment of dividends and distribution of assets upon liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, all shares of common stock will participate pro rata in such payment whenever funds are legally available and when declared by the Board of Directors, subject to the prior rights of holders of all classes of stock outstanding. Shares presented above have not been adjusted for an approximate 43.6-for-1 stock split. As of September 30, 2021, there were 1,000,000,000 shares of common stock authorized and 305,117,043 shares of common stock outstanding. |
(Loss) Earnings Per Common Shar
(Loss) Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
(Loss) Earnings Per Common Share | (Loss) Earnings Per Common Share Basic (loss) earnings per common share is computed by dividing the net (loss) income allocated to common shareholders by the weighted average of common shares outstanding for the period. The Company reported net income for the nine months ended September 30, 2021; however, after the adjustment for dividends paid to preferred shareholders, which is a reduction to net income available to common shareholders, the Company has a net loss allocated to common shareholders. Diluted loss per common share is computed by giving effect to all potential shares of common stock of the Company, including outstanding stock options and unvested equity-settled RSUs, to the extent dilutive. Basic and diluted loss per common share is the same for the current period ended, as the inclusion of all potential shares of common stock of the Company outstanding would have been anti-dilutive. The dilutive effect of potentially dilutive securities is reflected in diluted earnings per common share by application of the treasury stock method. For comparability purposes, all prior period share amounts presented have been retroactively adjusted to give effect to an approximate 43.6-for-1 stock split, and share counts below also reflect the conversion of preferred stock to common stock on a 1-for-1 basis upon the occurrence of the IPO. The components of basic and diluted (loss) earnings per common share are as follows (in thousands, except share and per share data): Three Months Ended September 30, 2021 2020 Basic (loss) earnings per common share: Net (loss) income $ (25,235) $ 21,882 Preferred stock dividends — — Net (loss) income allocated to common shareholders – Basic $ (25,235) $ 21,882 Weighted average common shares outstanding – Basic 241,351,052 278,218,732 Basic (loss) earnings per common share $ (0.10) $ 0.08 Diluted (loss) earnings per common share: Net (loss) income allocated to common shareholders – Basic (25,235) 21,882 Weighted average shares outstanding – Basic 241,351,052 278,218,732 Dilutive effect of: Employee stock options and restricted common shares (1) — 6,855,016 Weighted average common shares outstanding – Diluted 241,351,052 285,073,748 Diluted (loss) earnings per common share $ (0.10) $ 0.08 Nine Months Ended September 30, 2021 2020 Basic (loss) earnings per common share: Net income $ 11,502 $ 59,679 Preferred stock dividends (59,642) — Net (loss) income allocated to common shareholders – Basic $ (48,140) $ 59,679 Weighted average common shares outstanding – Basic 237,121,811 278,202,291 Basic (loss) earnings per common share $ (0.20) $ 0.21 Diluted (loss) earnings per common share: Net (loss) income allocated to common shareholders – Basic (48,140) 59,679 Weighted average shares outstanding – Basic 237,121,811 278,202,291 Dilutive effect of: Employee stock options and common shares (1) — 5,962,757 Weighted average common shares outstanding – Diluted 237,121,811 284,165,048 Diluted (loss) earnings per common share $ (0.20) $ 0.21 (1) Reflects the dilutive effects of applying the treasury stock method to the employee stock options, after effects of an approximate 43.6-for-1 stock split noted above. Dilutive options include time and performance vesting options. Performance vesting options represent the accelerated vesting of all performance vesting options upon the occurrence of the IPO, and are only reflected in the denominator of pro forma earnings per share, diluted, as the performance vesting options are fully vested at the date of the IPO, and are not assumed to be exercised. For periods where the Company was in a net loss, dilutive options were excluded but would have been dilutive if the Company was not in a net loss. The following potentially dilutive securities were excluded from the computation of diluted (loss) earnings per common share calculations for the three and nine months ended September 30, 2021 because the impact of including them would have been anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Employee stock options and common shares 20,968,124 — 20,839,475 — RSUs 2,683,513 — 897,793 — Refer to the calculations included in the tables above for the computation of diluted (loss) earnings per common share for the three and nine months ended September 30, 2020. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies From time to time, the Company may become involved in legal proceedings or be subject to claims arising in the ordinary course of business. The Company evaluates the development of legal matters on a regular basis and accrues a liability when they believe a loss is probable and the amount can be reasonably estimated. Although the results of litigation and claims cannot be predicted with certainty, the Company currently believes that the final outcome of any currently pending legal proceedings to which we are a party will not have a material adverse effect on our business, operating results, financial condition or cash flows. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors. Commitment and contingencies primarily includes operating leases. The Company leases certain facilities and equipment under various non-cancelable operating leases that expire through July 2031. As of September 30, 2021, aggregate future minimum lease payments, net of sublease income, under all operating leases are as follows (in thousands): Year ending December 31, Total 2021 (excluding nine months ended September 30, 2021) $ 3,522 2022 17,783 2023 15,061 2024 13,123 2025 11,699 Thereafter 10,069 Total future minimum lease payments $ 71,257 Total rent expense for all operating leases for the three and nine months ended September 30, 2021 were $4.9 million and $14.5 million, and for the three and nine months ended September 30, 2020 were $4.7 million and $14.0 million, respectively. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Equity Incentive Plans On October 12, 2017, the Company approved the 2017 Stock Option Plan (the “2017 Plan”) for the purpose of providing an incentive compensation structure to participants. Under the 2017 Plan, the Company may make awards to such present and future officers, directors, employees, consultants and advisors of the Company as may be selected at the sole discretion of the Board of Directors. The option awards gave the participant the right to purchase the Company's former Class C common stock for a prespecified exercise price. As a result of the IPO, the Company no longer grants awards under the 2017 Plan, and all previously awarded options can now be exercised for, when vested and exercisable, only the Company's current common stock. In September 2021, the Board of Directors approved the 2021 Omnibus Incentive Plan (the “Omnibus Plan” ) to assist the Company in attracting, retaining, motivating, and rewarding certain employees, officers, directors, and consultants of the Company and its Affiliates and promoting the creation of long-term value for stockholders, which became effective in connection with the IPO. A total of 62,048,123 shares of the Company’s common stock have been reserved for issuance under the 2021 Omnibus Incentive Plan. Time and Performance Vesting Options Under the 2017 Plan, eligible employees received non-qualified stock options as a portion of their total compensation. The options vest on a graded time vesting schedule (“Time Vesting Options”) over a contractual term of four years, with 37.5% vesting on the 18-month anniversary and 6.25% vesting every three months for the remainder of the 48-month period. 100% of the time-vesting options vest immediately upon a change of control. Any unvested options will be forfeited upon termination of employment. The Company's 2017 Plan permits imposing lock-up restrictions on participants in connection with the IPO. Pursuant to the 2017 Plan, the Company imposed a lock-up restriction, subject to limited exceptions, on selling, transferring or otherwise disposing of options and shares of common stock issuable pursuant to the exercise of options, for a period of one year following the consummation of the IPO, provided that such restriction will lapse as to 50% of such options and shares after six months following the consummation of the offering. The following is a summary of time vesting option activity for the period ended September 30, 2021 (in thousands, except share and per share data): Time Vesting (1) Weighted Average Exercise Price (1) Aggregate Weighted- Balance at December 31, 2020 10,462,531 $ 2.76 $ 12,149 1.36 Granted 1,068,283 14.05 Forfeited (134,135) 5.32 Exercised (966,005) 2.36 Cancelled (1,752,878) 2.88 Expired — — Balance at September 30, 2021 8,677,796 $ 4.13 $ 20,033 1.04 Exercisable at September 30, 2021 5,585,354 $ 2.46 $ 3,729 0.34 Nonvested at September 30, 2021 3,092,442 $ 7.14 $ 16,304 2.29 (1) Options presented have been retroactively adjusted to give effect to an approximate 43.6-for-1 stock split. As of September 30, 2021, total compensation cost related to time vesting options not yet recognized was $10.3 million, which will be recognized over a weighted-average period of 1.04 years. The following is a summary of performance vesting option activity for the period ended September 30, 2021 (in thousands, except share and per share data): Performance Vesting (1) Weighted Average Exercise Price (1) Aggregate Balance at December 31, 2020 15,440,716 $ 2.66 $ 12,498 Granted 1,397,260 14.05 Forfeited (193,681) 4.92 Exercised (187,943) 2.38 Cancelled (1,009,831) 3.60 Expired — Balance at September 30, 2021 15,446,521 $ 3.60 $ 24,776 Exercisable at September 30, 2021 15,446,521 $ 3.60 $ 24,776 Nonvested at September 30, 2021 — $ — $ — (1) Options presented have been retroactively adjusted to give effect to an approximate 43.6-for-1 stock split. Under the 2017 Plan, prior to the IPO the Company granted performance vesting options subject to performance vesting conditions. In accordance with the 2017 Plan, 50% of the performance vesting options vested upon a sponsor return of at least two times the sponsor investment. An aggregate of 75% of the performance vesting options vested upon a sponsor return of at least two and a half times the sponsor investment. An aggregate of 100% of Performance Vesting Options vested upon a sponsor return of at least three times the sponsor investment. Vesting was prorated if a sponsor return was between these targets. In addition to the sponsor return targets above, participants must have had at least 18 months of continuous service following the grant date in order to vest. In order for vesting to be considered probable, the sponsor return must have been met as of the reporting date. Sponsor return, as defined in the Company’s 2017 Stock Option Plan, was determined based on the aggregate amount of all cash, fair market value of marketable securities, including proceeds from the sale of securities of the Company, provided and to the extent such proceeds result in cash dividends and/or cash distributions by the Company to the sponsor. On September 9, 2021, the Board of Directors, through unanimous written consent, approved a modification to the Company's 2017 Stock Option Plan which, upon completion of the IPO, a sponsor return of 2.8x times sponsor investment was certified as having been achieved, and the service condition under the Plan that participants must provide at least 18 months of continuous service following the grant date in order for performance vesting options to vest was waived. Additionally, the Board of Directors also approved accelerated vesting of all remaining, unvested former Class C performance vesting options, after the achievement of such sponsor return, which resulted in all performance vesting options becoming fully vested upon completion of the IPO. The acceleration of vesting was accounted for as a modification of the terms of the original award. The incremental stock-based compensation expense of $54.0 million related to the accelerated vesting of all outstanding, unvested performance vesting options, consisting of (a) $15.9 million related to the achievement of sponsor return hurdles that were met upon completion of the IPO (calculated using the grant date fair value of such awards) and (b) $38.1 million related to the remaining unvested performance vesting options upon completion of the IPO (calculated using a fair value of the IPO price of $21.00 per share). The following table summarizes the weighted-average assumptions used in estimating the fair value of stock options granted to employees for the three and nine months ended September 31, 2021 and 2020: Three Months Ended September 30, Nine Months Ended September 30, 2021 (1) 2020 (2) 2021 (2) 2020 (2) Risk-free interest rate — % 0.1 % 0.1 % 0.1 % Dividend yield — % — % — % — % Expected volatility — % 55.0 % 55.0 % 55.0 % Expected term (years) 0 2 1 2 (1) No options were granted during the three months ended September 30, 2021. (2) In 2021 and 2020, the risk-free interest rate is based on the rates of U.S. Treasury securities with a maturity similar to the term to liquidity, continuously compounded. The expected equity volatility is estimated based on an analysis of guideline public companies’ historical volatility. As these stock options were awarded prior to the IPO, the expected term was estimated based on management’s assumptions of time to a liquidity event. Stock Appreciation Rights (“SARs”) In December 2017, the Board of Directors approved a plan (the “SARs Plan”) to enable all permanent employees, current and future, to participate in the growth in the equity value of the Company in the event of a future liquidity event. A liquidity event is triggered when the sponsor sells at least 75% of its ownership. During the nine months ended September 30, 2021 , the Company granted SARs to employees. Each stock appreciation right represents the right to receive, in cash, the excess of the fair market value over the grant price on the exercise date. On September 9, 2021, the Board of Directors, through unanimous written consent, approved a modification to the Company's SARs Plan which, upon completion of the IPO, was discontinued and all outstanding SARs were converted to restricted stock units (“RSUs”). RSUs granted in connection with the SARs conversion will vest after six months and twelve months as to 50% on each vesting date, such that 100% of RSUs related to the SARs conversion will be fully vested twelve months after the closing of the IPO. A total of 6,701,133 shares of common stock underlying RSUs were issued in connection with the conversion of SARs upon completion of the IPO. The completion of the IPO of the Company’s common stock did not meet the definition of a liquidity event, as defined in the SARs Plan. As a liquidity event was not triggered, the conditions associated with SARs were not considered probable of occurring, and no expense related to this modification was recognized for the nine months ended September 30, 2021 . The following is a summary of SARs activity, representing the conversion of SARs to RSUs, for the period ended September 30, 2021: Number of Stock Appreciation Rights (1) Weighted Average Grant Date Fair Value (1) Balance at December 31, 2020 9,032,006 $ 3.47 Granted 3,096,082 14.05 Forfeited (1,681,980) 5.77 Intrinsic Value Adjustment (2) (3,744,975) 12.19 SARs Conversion (6,701,133) 21.00 Balance at September 30, 2021 — $ — (1) Shares presented have been retroactively adjusted to give effect to an approximate 43.6-for-1 stock split. (2) The intrinsic value adjustment is the IPO price of $21.00 per SAR, less the original grant date fair value, plus an incremental value of $100.00 per SAR. Restricted Stock Units (“RSUs”) Under the Omnibus Plan, RSUs are awarded to eligible employees and entitle the grantee to receive shares of common stock at the end of a vesting period. Certain RSUs granted during the period ended September 30, 2021, have varying vesting schedules: (1) a 28 month cliff vest subsequent to the IPO Closing Date; (2) a 12 month cliff vest subsequent to the IPO Closing Date; (3) a 6 and 12 month period vest subsequent to the IPO Closing Date (with 50% vesting after 6 months and 50% vesting at the end of the 12 month term); (4) immediate vesting upon the successful and active registration with the State Administration of Foreign Exchange of the People's Republic of China ( “China SAFE”) ; and (5) a 3 year ratable vesting period subsequent to IPO Closing Date (with 34% vesting during the first year, and 33% vesting during the second and third year). Throughout the vesting period, shareholders are subject to the market risk on the value of their shares. The following is a summary of all RSUs activity for the period ended September 30, 2021: Number of Restricted Stock Units Weighted Average Grant Date Fair Value Unvested balance at December 31, 2020 — $ — Granted (1) 5,017,572 21.00 Granted - SARs conversion (1) 6,701,133 21.00 Forfeited (90,148) 21.00 Vested — — Unvested balance at September 30, 2021 11,628,557 $ 21.00 (1) The amount of granted restricted stock units does not include those awards contingent upon the successful and active registration with the State Administration of Foreign Exchange of the People's Republic of China (“China SAFE”). RSUs contingent on China SAFE totaled 3,878,909 RSUs as of September 30, 2021. As of September 30, 2021, total compensation cost related to all RSUs not yet recognized was $227.5 million, which will be recognized over a weighted-average period of 1.4 years. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Tender Offer During the quarter ended March 31, 2021, the Board of Directors approved, and the Company completed a tender offer of common shares which was funded from the proceeds of the redeemable, convertible preferred stock offering (Note 6, Redeemable, Convertible Preferred Stock ). As a result, the Company acquired 1,156,775 shares of its common stock (1,138,537, 12,979, and 5,259 shares of the Company's former Class A, B, and C common shares, respectively). The Company also purchased and cancelled vested options from employees and directors through the tender offer. In this Note, the shares presented have not been adjusted for an approximate 43.6-for-1 stock split. Total purchases of shares and vested employee options under the tender offer approximated $720.0 million, including $19.3 million held for withholding tax. Because the price paid per share exceeded the share’s respective fair value, the Company recognized $2.7 million of additional compensation expense associated with shares and options repurchased from employees and directors, and $79.2 million as a distribution of retained earnings for the excess of price paid over fair value for those shares repurchased from non-employee securityholders. Redeemable Convertible Preferred Stock In September 2021, upon the closing of the Company's IPO, all outstanding shares of redeemable convertible preferred stock were converted into an aggregate of 1,365,058 shares of common stock. Shares presented above have not been adjusted for an approximate 43.6-for-1 stock split. Further, in connection with the IPO, the Company’s amended and restated certificate of incorporation became effective, which authorized the issuance of 100,000,000 shares of undesignated preferred stock with a par value of $0.001 per share with rights and preferences, including voting rights, designated from time to time by the Board of Directors. Common Stock In connection with the IPO, all classes of shares of the Company's common stock then outstanding were converted into 5,259,163 shares of common stock on a one-to-one basis. As a result, the securities of the Company are represented by shares of common stock with a par value of $0.001 per share. Each share of common stock is entitled to one vote. With respect to payment of dividends and distribution of assets upon liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, all shares of common stock will participate pro rata in such payment whenever funds are legally available and when declared by the Board of Directors, subject to the prior rights of holders of all classes of stock outstanding. Shares presented above have not been adjusted for an approximate 43.6-for-1 stock split. As of September 30, 2021, there were 1,000,000,000 shares of common stock authorized and 305,117,043 shares of common stock outstanding. |
Credit Agreements
Credit Agreements | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Credit Agreements | Credit Agreements The Company entered into a Senior Secured Credit Facilities (the “Term Loan”), dated October 12, 2017, subsequently amended most recently as of March 26, 2021, among the Company, the syndicate lenders thereto and Credit Suisse, AG, Cayman Islands Branch, as administrative agent, to finance, in part, the acquisition of all of the outstanding common stock of the Company. The Senior Secured Credit Facility provided senior secured financing of $200.0 million, as well as a revolving credit facility (the “Revolver”) which provided for additional senior secured financing of up to $35.0 million. The Term Loan and the Revolver, together with any subsequent amendments, are collectively referred to as the Credit Agreement. On March 26, 2021, the Company amended and restated its credit agreement (the “Amendment and Restatement”) to increase the term loan facility to a total of $715.0 million. Also, as part of the facility, the aggregate revolving credit facility was increased to $165.0 million from $85.0 million. Borrowings under the Term Loan bear interest at a rate per annum equal to an applicable margin based on the Company’s leverage ratio, plus either (a) a base rate or (b) a LIBOR rate, at the Company's option, subject to interest rate floors. For the first full quarter after the Amendment Restatement date, the interest rate per annum is equal to (a) 3.25% for LIBOR based borrowings and (b) 2.25% for base rate borrowings, subject to interest rate floors. Borrowings under the Revolver bear interest at a rate per annum equal to an applicable margin based on the Company’s leverage ratio, plus either (a) a base rate or (b) a LIBOR rate at the Company's option. In addition to paying interest on outstanding borrowings under the Revolver, the Company is required to pay a commitment fee to the lenders under the Revolver in respect of unutilized commitments thereunder and customary letter of credit fees. The interest rates on borrowings at September 30, 2021 and at September 30, 2020 were approximately 3.5% and 4.8% , respectively. Interest expense for the three and nine months ended September 30, 2021 was $6.3 million and $18.7 million , respectively, and for the three and nine months ended September 30, 2020 was $5.6 million and $18.4 million, respectively. All obligations of the Company under the Senior Secured Credit Facilities provided by any lender party to the Senior Secured Credit Facilities or any of its affiliates and certain other persons are unconditionally guaranteed by a wholly owned subsidiary of Thoughtworks Holding, Inc., and each existing and subsequently acquired or organized direct or indirect wholly owned domestic restricted subsidiary of the Company, with customary exceptions including, among other things, where providing such guarantees is not permitted by law, regulation or contract or would result in material adverse tax consequences. All obligations under the Senior Secured Credit Facilities provided by any lender party to the Senior Secured Credit Facilities or any of its affiliates and certain other persons, and the guarantees of such obligations, are secured, subject to permitted liens and other exceptions, as outlined in the Senior Secured Credit Facilities. The Term Loans and borrowings under our Revolver contain a number of financial and non-financial covenants that, among other things, restrict, subject to certain exceptions, the Company’s ability and the ability of the Company’s restricted subsidiaries to engage in certain activities, such as incur indebtedness or permit to exist any lien on any property or asset now owned or hereafter acquired, as specified in the debt facility. The Company had no outstanding draws under the $165.0 million Revolver at September 30, 2021. The Company had no outstanding draws under our previous $85.0 million Revolver at December 31, 2020. As of September 30, 2021, the Company was in compliance with its debt covenants. The Credit Agreement requires compliance with various covenants customary for agreements of this type, including a springing financial covenant (solely for the benefit of the Revolver), a passive holdings covenant with respect to Holdings and negative covenants that limit, among other things, the Borrowers’ and their restricted subsidiaries’ ability to incur additional debt, create or incur liens, engage in mergers or consolidations, sell, transfer or otherwise dispose of assets, make voluntary prepayments to subordinated debt, pay dividends or distributions, make investments, and enter into certain transactions with affiliates. We are currently in compliance with all covenants contained in our Credit Agreement. The Credit Agreement also includes events of default customary for agreements of this type. Further, as it relates to restricted subsidiaries, as of September 30, 2021, none of our consolidated net assets were subject to dividend restrictions under the Credit Agreement. The Company incurred and capitalized deferred financing fees, or third-party debt issuance costs, of $7.1 million related to the restated credit agreement during the nine months ended September 30, 2021. The debt issuance costs are recorded as reductions of the outstanding long-term indebtedness. The Term Loan is paid in equal quarterly installments in aggregate annual amounts equal to 1% of the original principal amount of the Term Loan matures on March 24, 2028. The principal amount outstanding under the Revolver under the Amendment and Restatement is due and payable in full at maturity on March 26, 2026. On August 10, 2021, the Company made a voluntary prepayment of $100.0 million on outstanding amounts owed on the Term Loan. The carrying value of the Company’s credit facilities (including current maturities) was as follows (in thousands): As of As of September 30, 2021 December 31, 2020 Long-term debt, less current portion $ 604,275 $ 440,497 Capitalized deferred financing fees (7,271) (5,305) Long-term debt 597,004 435,192 Current portion of long-term debt 7,150 4,565 Total debt carrying value $ 604,154 $ 439,757 |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Accrued Expenses The following is a summary of the Company’s accrued expenses (in thousands): As of As of September 30, 2021 December 31, 2020 Accrued interest expense $ 86 $ 85 Accrued employee expense 2,123 1,786 Accrued travel expense 432 383 Operating lease expenses 324 212 Insurance charges 167 257 Professional fees 12,008 10,320 Withholding taxes payable 34,489 43 Other taxes payable 10,248 8,643 Rebates payable 599 2,307 Other accrued expenses 4,646 5,713 Accrued expenses $ 65,122 $ 29,749 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Credit Agreement Repayment On October 20, 2021, the Company made a voluntary prepayment of $100.0 million on outstanding amounts owed on the Term Loan disclosed in Note 12, Credit Agreements . |
Business and Summary of Signi_2
Business and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Consolidation | The accompanying unaudited condensed consolidated financial statements include the accounts of Thoughtworks Holding, Inc. and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements should be read in conjunction with the condensed consolidated financial statements and notes included in the Company’s IPO Prospectus. |
Preparation of Financial Statements | The preparation of the unaudited condensed consolidated financial statements and accompanying notes should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2020. |
Use of Estimates | The preparation of these condensed consolidated financial statements is in conformity with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. On an ongoing basis, the Company evaluates its estimates, including those related to allowance for doubtful accounts, valuation and impairment of goodwill and long-lived assets, income taxes, accrued bonus, contingencies, stock-based compensation, including the underlying deemed fair value of common stock (prior to the completion of the IPO), and litigation costs. The Company bases its estimates on historical experience and on other assumptions that its management believes are reasonable under the circumstances. These estimates form the basis for making judgments about the carrying value of assets and liabilities when those values are not readily apparent from other sources. Actual results can differ from those estimates, and such differences may be material to the condensed consolidated financial statements. Operating results for the interim periods are not necessarily indicative of results that may be expected to occur for the entire year. In management’s opinion, all adjustments considered necessary for a fair presentation of the accompanying unaudited condensed consolidated financial statements have been included, and all adjustments are of a normal and recurring nature. |
Segments | The Company operates as one operating segment. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and assess performance. While the Company has offerings in multiple modern digital businesses and operates in multiple countries, the Company’s business operates in one operating segment because most of the Company's service offerings are delivered and supported on a global basis, most of the Company's service offerings are deployed in a nearly identical way, and the Company’s CODM evaluates the Company’s financial information and resources and assesses the performance of these resources on a consolidated basis. Long-Lived Assets The North America geographic region encompasses the Company’s country of domicile (United States) and Canada, of which long-lived assets including property and equipment, net of depreciation, are principally held within the United States. The United States comprised $7.0 million, or 20.0%, and $4.6 million, or 17.4%, of the Company’s long-lived assets as of September 30, 2021 and December 31, 2020, respectively. Canadian long-lived assets were determined to be immaterial given property, and equipment was less than 10% of the Company's long-lived assets as of September 30, 2021 and December 31, 2020. The Company holds material long-lived assets in the foreign geographic locations of Brazil, China, and India of $5.8 million, $8.1 million, and $7.6 million as of September 30, 2021, respectively, compared to $2.8 million, $7.6 million, and $5.3 million as of December 31, 2020, respectively. Long-lived assets in all other foreign geographic locations, including Canada, totaled $6.5 million and $6.0 million as of September 30, 2021 and December 31, 2020, respectively. |
Stock-Based Compensation | The Company accounts for employee and non-employee equity-based compensation in accordance with ASC 718, Compensation – Stock Compensation . Accordingly, compensation expense for employee and non-employee services received in exchange for equity awards is based on the grant date fair value of those awards and is recognized over the requisite service period for the respective award. Prior to the IPO, the fair market value of the Company’s common stock was determined by the estimated fair market value of the Company’s common stock at the time of grant. Upon the completion of the IPO, the Company uses the market closing price of its common stock on the date of grant to determine the fair market value of the common stock, or if there is no market closing price on the date of grant, the closing price reported on the most recent trading date on Nasdaq. The Company’s equity-based awards issued to employees include stock option awards issued by the Company, which vest based on either time or the achievement of certain performance and market conditions. The Company records forfeitures as they occur. Compensation expense resulting from time vesting based awards will be recognized in the Company’s consolidated statement of operations and comprehensive income (loss), primarily within general and administrative expenses, at the grant date fair value over the requisite service period (typically one Common Stock Valuation Prior to the IPO Closing Date Prior to the IPO Closing Date, due to the absence of an active market for the Company’s common stock, the Company utilized methodologies in accordance with the framework of the American Institute of Certified Public Accountants’ Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of common stock. The valuation methodology included estimates and assumptions that required the Company’s judgment. These estimates and assumptions included a number of objective and subjective factors, including external market conditions affecting the industry sector, and the likelihood of achieving a liquidity event, such as an IPO, reverse merger or sale. Significant changes to the key assumptions used in the valuations resulted in different fair values of common stock at each valuation date. The Company’s equity-based awards also include restricted stock units ("RSUs"), and the fair value of each RSU is based on the fair value of the Company’s common stock on the date of grant. Refer to Note 11, Stock-Based Compensation , for more information on equity-based awards and the related activity that occurred in connection with the IPO. |
Restricted Cash | Restricted cash is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Restricted cash is restricted as to withdrawal or use. The Company has restricted cash held on deposit at various financial institutions. The amounts are held in escrow for income tax withholdings, to secure bank guarantees of amounts related to government requirements, and collateral for a corporate credit card. |
Recently Adopted Accounting Standards and Recently Issued Accounting Pronouncements Not Yet Adopted | In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2018-13, Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement , which amends Accounting Standards Codification (“ASC”) 820, Fair Value Measurement . This ASU modifies the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. The effective date is the first quarter of fiscal year 2020, with early adoption permitted for the removed disclosures and delayed adoption until fiscal year 2020 permitted for the new disclosures. The removed and modified disclosures were adopted on a retrospective basis and the new disclosures will be adopted on a prospective basis. The adoption of ASU 2018-13 did not have a material impact on the Company’s condensed consolidated financial statements. In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Customers Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract . ASU 2018-15 is intended to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The ASU is effective for annual reporting periods beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. Early adoption is permitted. In the third quarter of 2021, the Company early adopted ASU 2018-15 and this adoption did not have a material impact on the Company’s condensed consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) : Simplifying the Accounting for Income Taxes , as part of its simplification initiative to reduce the cost and complexity in accounting for income taxes. ASU 2019-12 removes certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of GAAP. The guidance became effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. The adoption of ASU 2019-12 did not have a material impact on the Company’s condensed consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which amends existing accounting standards for lease accounting and requires lessees to recognize virtually all their leases on the balance sheet by recording a right-of-use asset and a lease liability (for other than short term leases). The Company is in the preliminary stages of gathering data and assessing the impact of the new lease standard. The Company anticipates that the adoption of this standard will materially affect the consolidated balance sheet and may require changes to the processes used to account for leases. The Company is currently in the process of evaluating the impact of the adoption of Topic 842 on the condensed consolidated financial statements and will adopt this new standard in the fiscal year beginning January 1, 2022, based on its status as an emerging growth company. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which amends the current accounting guidance and requires the measurement of all expected losses based on historical experience, current conditions, and reasonable and supportable forecasts, or a current expected credit loss (“CECL”) model. For trade receivables, loans, and other financial instruments, companies will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable. In November 2019, the FASB issued ASU 2019-10 which delayed the effective date for the CECL standard. This guidance and related amendments is effective for the Company for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The Company is currently assessing the impact of this ASU on the condensed consolidated financial statements and will adopt this new standard in the fiscal year beginning January 1, 2023, based on its status as an emerging growth company. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) : Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides temporary optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions to ease the financial reporting burdens related to the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. The optional amendments are effective as of March 12, 2020 through December 31, 2022. The Company is currently assessing the impact of this ASU on the condensed consolidated financial statements and will adopt this new standard in the fiscal year beginning January 1, 2023 based on its status as an emerging growth company. |
Impairment Analysis | Impairment analysis Goodwill and indefinite lived intangible assets are tested for impairment at the reporting unit level on an annual basis and on an interim basis if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. We perform our annual goodwill impairment tests as of October 1. Finite-lived intangible assets primarily consist of customer relationships. These assets are recorded at fair value at the acquisition date and amortized on a straight-line basis over the estimated useful lives of the assets. The Company tests intangible assets with finite useful lives for impairment when a triggering event occurs, or circumstances change indicating that the fair value of the entity may be below its carrying amount. If no triggering event occurs, further impairment testing is not necessary. Long-lived assets, such as property and equipment, are reviewed for potential impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset or asset group exceeds the fair value of the asset or asset group. |
Business and Summary of Signi_3
Business and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Cash and Cash Equivalents | A reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheet is as follows (in thousands): As of September 30, 2021 As of December 31, 2020 Cash and cash equivalents $ 452,810 $ 490,841 Restricted cash included in other current assets 26,827 — Restricted cash included in other non-current assets 1,325 1,358 Total cash, cash equivalents, and restricted cash $ 480,962 $ 492,199 |
Restrictions on Cash and Cash Equivalents | A reconciliation of cash, cash equivalents and restricted cash to the condensed consolidated balance sheet is as follows (in thousands): As of September 30, 2021 As of December 31, 2020 Cash and cash equivalents $ 452,810 $ 490,841 Restricted cash included in other current assets 26,827 — Restricted cash included in other non-current assets 1,325 1,358 Total cash, cash equivalents, and restricted cash $ 480,962 $ 492,199 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from External Customers by Geographic Areas | The following tables present the disaggregation of the Company’s revenues by customer location for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended September 30, 2021 2020 Customer Location: North America (1) $ 103,769 $ 76,649 APAC (2) 98,756 64,457 Europe (3) 69,522 46,623 LATAM 13,004 8,820 Revenues $ 285,051 $ 196,549 (1) North America encompasses the Company’s country of domicile (United States) and Canada, of which revenue is principally generated within the United States. During the three months ended September 30, 2021 and September 30, 2020, the United States represented 33.9%, or $96.5 million, and 37.3%, or $73.4 million, of the Company’s total revenues, respectively. Canadian operations were determined to be immaterial given the revenues generated from such operations as a percentage of total North America revenues was less than 10% for the three months ended September 30, 2021 and September 30, 2020. (2) During the three months ended September 30, 2021, Australia, which is included in the Asia-Pacific region ("APAC"), represented 10.9%, or $31.0 million, of the Company’s total revenues. During the three months ended September 30, 2021, the revenues generated in China as a percentage of the Company’s total revenues was less than 10%. For the three months ended September 30, 2020, the revenues generated in Australia and China represented 10.0%, or $19.7 million, and 11.9%, or $23.4 million, of the Company’s total revenues respectively. (3) During the three months ended September 30, 2021, Germany and the United Kingdom, which are included in the Europe region, represented 10.5%, or $30.0 million, and 10.5%, or $30.0 million, of the Company’s total revenues, respectively. For the three months ended September 30, 2020, the revenues generated in Germany and the United King dom represented 10.1%, or $19.8 million, and 10.6%, or $20.8 million, o f the Company’s total revenues, respectively. Other foreign countries were determined to be immaterial given the revenues generated from such operations as a percentage of the Company’s total revenues was less than 10% for the three months ended September 30, 2021 and September 30, 2020. Nine Months Ended September 30, 2021 2020 Customer Location: North America (1) $ 290,954 $ 243,797 APAC (2) 260,928 181,738 Europe (3) 196,476 143,673 LATAM 34,787 27,874 Revenues $ 783,145 $ 597,082 (1) During the nine months ended September 30, 2021 and September 30, 2020, the United States represented 35.1%, or $275.0 million, and 39.1%, or $233.5 million, of the Company’s total revenues, respectively. Canadian operations were determined to be immaterial given the revenues generated from such operations as a percentage of total North America revenues was less than 10% for the nine months ended September 30, 2021 and September 30, 2020. (2) During the nine months ended September 30, 2021, Australia, which is included in the APAC region, represented 10.7%, or $83.7 million of the Company’s total revenues. For the nine months ended September 30, 2020, the revenues generated in Australia as a percentage of the Company’s total revenues was less than 10%. (3) During the nine months ended September 30, 2021, Germany and the United Kingdom, which are included in the Europe region, represented 10.7%, or $84.2 million, and 10.7%, or $83.5 million, of the Company’s total revenues, respectively. For the nine months ended September 30, 2020, the revenues generated in Germany and the United Kingdom represented 10.0%, or $59.9 million, and 11.0%, or $65.7 million, of the Company’s total revenues, respectively. Other foreign countries were determined to be immaterial given the revenues generated from such operations as a percentage of the Company’s total revenues was less than 10% for the nine months ended September 30, 2021 and September 30, 2020. |
Disaggregation of Revenue | The following tables present the disaggregation of the Company’s revenues by contract type for the three and nine months ended September 30, 2021 and 2020 (in thousands): Three Months Ended September 30, 2021 2020 Contract Types: Time-and-material $ 237,533 $ 161,202 Fixed-price 47,518 35,319 Licensing — 28 Revenues $ 285,051 $ 196,549 Nine Months Ended September 30, 2021 2020 Contract Types: Time-and-material $ 635,608 $ 504,710 Fixed-price 147,537 92,029 Licensing — 343 Revenues $ 783,145 $ 597,082 |
Schedule of Contract Assets and Liabilities | The following table is a summary of the Company’s contract assets and contract liabilities (in thousands): As of September 30, 2021 As of December 31, 2020 Contract assets included in unbilled receivables $ 29,264 $ 19,790 Contract liabilities included in deferred revenue $ 9,054 $ 11,720 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The Company's preliminary allocation of the fair value of underlying assets acquired and liabilities assumed as of the acquisition date is as follows (in thousands): Total Customer Relationship $ 11,100 Property and Equipment 259 Other assets/liabilities, net 4,228 Deferred Taxes (1,646) Goodwill 32,615 Total gross purchase pric e $ 46,556 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following is a summary of goodwill as of September 30, 2021 (in thousands): Total Balance as of December 31, 2019 $ 314,037 Changes due to exchange rates 4,114 Balance as of December 31, 2020 318,151 Additions due to acquisitions 32,615 Changes due to exchange rates (3,935) Balance as of September 30, 2021 $ 346,831 |
Schedule of Finite-Lived Intangible Assets | The following is a summary of other intangible assets as of (in thousands): September 30, 2021 December 31, 2020 Customer relationships $ 177,100 $ 166,000 Less accumulated amortization 43,177 34,122 Customer relationships 133,923 131,878 Trademark 273,000 273,000 Total intangible assets, after amortization 406,923 404,878 Changes due to exchange rates (5,103) (2,823) Intangible assets, net $ 401,820 $ 402,055 |
Schedule of Indefinite-Lived Intangible Assets | The following is a summary of other intangible assets as of (in thousands): September 30, 2021 December 31, 2020 Customer relationships $ 177,100 $ 166,000 Less accumulated amortization 43,177 34,122 Customer relationships 133,923 131,878 Trademark 273,000 273,000 Total intangible assets, after amortization 406,923 404,878 Changes due to exchange rates (5,103) (2,823) Intangible assets, net $ 401,820 $ 402,055 |
Schedule of Estimated Amortization Expense | As of September 30, 2021, estimated amortization expense for the next five years and thereafter is as follows (in thousands): Year Ending December 31, Total 2021 (excluding nine months ended September 30, 2021) $ 3,075 2022 12,300 2023 12,300 2024 12,300 2025 12,300 Thereafter 81,648 $ 133,923 |
Net (Loss) Income Per Common Sh
Net (Loss) Income Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net (Loss) Income Per Common Share | The components of basic and diluted (loss) earnings per common share are as follows (in thousands, except share and per share data): Three Months Ended September 30, 2021 2020 Basic (loss) earnings per common share: Net (loss) income $ (25,235) $ 21,882 Preferred stock dividends — — Net (loss) income allocated to common shareholders – Basic $ (25,235) $ 21,882 Weighted average common shares outstanding – Basic 241,351,052 278,218,732 Basic (loss) earnings per common share $ (0.10) $ 0.08 Diluted (loss) earnings per common share: Net (loss) income allocated to common shareholders – Basic (25,235) 21,882 Weighted average shares outstanding – Basic 241,351,052 278,218,732 Dilutive effect of: Employee stock options and restricted common shares (1) — 6,855,016 Weighted average common shares outstanding – Diluted 241,351,052 285,073,748 Diluted (loss) earnings per common share $ (0.10) $ 0.08 Nine Months Ended September 30, 2021 2020 Basic (loss) earnings per common share: Net income $ 11,502 $ 59,679 Preferred stock dividends (59,642) — Net (loss) income allocated to common shareholders – Basic $ (48,140) $ 59,679 Weighted average common shares outstanding – Basic 237,121,811 278,202,291 Basic (loss) earnings per common share $ (0.20) $ 0.21 Diluted (loss) earnings per common share: Net (loss) income allocated to common shareholders – Basic (48,140) 59,679 Weighted average shares outstanding – Basic 237,121,811 278,202,291 Dilutive effect of: Employee stock options and common shares (1) — 5,962,757 Weighted average common shares outstanding – Diluted 237,121,811 284,165,048 Diluted (loss) earnings per common share $ (0.20) $ 0.21 (1) Reflects the dilutive effects of applying the treasury stock method to the employee stock options, after effects of an approximate 43.6-for-1 stock split noted above. Dilutive options include time and performance vesting options. Performance vesting options represent the accelerated vesting of all performance vesting options upon the occurrence of the IPO, and are only reflected in the denominator of pro forma earnings per share, diluted, as the performance vesting options are fully vested at the date of the IPO, and are not assumed to be exercised. For periods |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following potentially dilutive securities were excluded from the computation of diluted (loss) earnings per common share calculations for the three and nine months ended September 30, 2021 because the impact of including them would have been anti-dilutive: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Employee stock options and common shares 20,968,124 — 20,839,475 — RSUs 2,683,513 — 897,793 — |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | As of September 30, 2021, aggregate future minimum lease payments, net of sublease income, under all operating leases are as follows (in thousands): Year ending December 31, Total 2021 (excluding nine months ended September 30, 2021) $ 3,522 2022 17,783 2023 15,061 2024 13,123 2025 11,699 Thereafter 10,069 Total future minimum lease payments $ 71,257 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Option Activity | The following is a summary of time vesting option activity for the period ended September 30, 2021 (in thousands, except share and per share data): Time Vesting (1) Weighted Average Exercise Price (1) Aggregate Weighted- Balance at December 31, 2020 10,462,531 $ 2.76 $ 12,149 1.36 Granted 1,068,283 14.05 Forfeited (134,135) 5.32 Exercised (966,005) 2.36 Cancelled (1,752,878) 2.88 Expired — — Balance at September 30, 2021 8,677,796 $ 4.13 $ 20,033 1.04 Exercisable at September 30, 2021 5,585,354 $ 2.46 $ 3,729 0.34 Nonvested at September 30, 2021 3,092,442 $ 7.14 $ 16,304 2.29 (1) Options presented have been retroactively adjusted to give effect to an approximate 43.6-for-1 stock split. The following is a summary of performance vesting option activity for the period ended September 30, 2021 (in thousands, except share and per share data): Performance Vesting (1) Weighted Average Exercise Price (1) Aggregate Balance at December 31, 2020 15,440,716 $ 2.66 $ 12,498 Granted 1,397,260 14.05 Forfeited (193,681) 4.92 Exercised (187,943) 2.38 Cancelled (1,009,831) 3.60 Expired — Balance at September 30, 2021 15,446,521 $ 3.60 $ 24,776 Exercisable at September 30, 2021 15,446,521 $ 3.60 $ 24,776 Nonvested at September 30, 2021 — $ — $ — |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The following table summarizes the weighted-average assumptions used in estimating the fair value of stock options granted to employees for the three and nine months ended September 31, 2021 and 2020: Three Months Ended September 30, Nine Months Ended September 30, 2021 (1) 2020 (2) 2021 (2) 2020 (2) Risk-free interest rate — % 0.1 % 0.1 % 0.1 % Dividend yield — % — % — % — % Expected volatility — % 55.0 % 55.0 % 55.0 % Expected term (years) 0 2 1 2 (1) No options were granted during the three months ended September 30, 2021. (2) In 2021 and 2020, the risk-free interest rate is based on the rates of U.S. Treasury securities with a maturity similar to the term to liquidity, continuously compounded. The expected equity volatility is estimated based on an analysis of guideline public companies’ historical volatility. As these stock options were awarded prior to the IPO, the expected term was estimated based on management’s assumptions of time to a liquidity event. |
Schedule of Stock Appreciation Rights Activity | The following is a summary of SARs activity, representing the conversion of SARs to RSUs, for the period ended September 30, 2021: Number of Stock Appreciation Rights (1) Weighted Average Grant Date Fair Value (1) Balance at December 31, 2020 9,032,006 $ 3.47 Granted 3,096,082 14.05 Forfeited (1,681,980) 5.77 Intrinsic Value Adjustment (2) (3,744,975) 12.19 SARs Conversion (6,701,133) 21.00 Balance at September 30, 2021 — $ — (1) Shares presented have been retroactively adjusted to give effect to an approximate 43.6-for-1 stock split. |
Schedule of Restricted Stock Units Activity | The following is a summary of all RSUs activity for the period ended September 30, 2021: Number of Restricted Stock Units Weighted Average Grant Date Fair Value Unvested balance at December 31, 2020 — $ — Granted (1) 5,017,572 21.00 Granted - SARs conversion (1) 6,701,133 21.00 Forfeited (90,148) 21.00 Vested — — Unvested balance at September 30, 2021 11,628,557 $ 21.00 |
Credit Agreements (Tables)
Credit Agreements (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Credit Facilities | The carrying value of the Company’s credit facilities (including current maturities) was as follows (in thousands): As of As of September 30, 2021 December 31, 2020 Long-term debt, less current portion $ 604,275 $ 440,497 Capitalized deferred financing fees (7,271) (5,305) Long-term debt 597,004 435,192 Current portion of long-term debt 7,150 4,565 Total debt carrying value $ 604,154 $ 439,757 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | The following is a summary of the Company’s accrued expenses (in thousands): As of As of September 30, 2021 December 31, 2020 Accrued interest expense $ 86 $ 85 Accrued employee expense 2,123 1,786 Accrued travel expense 432 383 Operating lease expenses 324 212 Insurance charges 167 257 Professional fees 12,008 10,320 Withholding taxes payable 34,489 43 Other taxes payable 10,248 8,643 Rebates payable 599 2,307 Other accrued expenses 4,646 5,713 Accrued expenses $ 65,122 $ 29,749 |
Business and Summary of Signi_4
Business and Summary of Significant Accounting Policies - Narrative (Details) $ / shares in Units, $ in Thousands | Sep. 17, 2021USD ($)$ / sharesshares | Sep. 16, 2021shares | Sep. 30, 2021USD ($) | Sep. 30, 2020 | Sep. 30, 2021USD ($)segment | Sep. 30, 2020 | Dec. 31, 2020USD ($) |
Concentration Risk [Line Items] | |||||||
Proceeds from sale of stock | $ 314,700 | ||||||
Stock issuance costs | $ 30,300 | ||||||
Common stock redesignated (in shares) | shares | 5,259,163 | ||||||
Conversion of convertible securities, before stock split (in shares) | shares | 1,365,058 | ||||||
Stock redesignation, conversion ratio | 1 | ||||||
Stock split, conversion ratio | 43.6 | ||||||
Redeemable convertible preferred stock, conversion ratio | 1 | ||||||
Offering expense, net | $ 30,300 | ||||||
Underwriting discounts | 19,000 | ||||||
Offering expenses | $ 11,300 | ||||||
Number of operating segments | segment | 1 | ||||||
Fixed assets | $ 35,038 | $ 35,038 | $ 26,347 | ||||
Minimum | |||||||
Concentration Risk [Line Items] | |||||||
Service period | 1 year | ||||||
Maximum | |||||||
Concentration Risk [Line Items] | |||||||
Service period | 4 years | ||||||
IPO | |||||||
Concentration Risk [Line Items] | |||||||
Number of shares issued (in shares) | shares | 42,368,421 | ||||||
Price per share of common stock (in dollars per share) | $ / shares | $ 21 | ||||||
Stock issuance costs | 30,300 | $ 30,300 | |||||
IPO, Common Stock | |||||||
Concentration Risk [Line Items] | |||||||
Number of shares issued (in shares) | shares | 16,429,964 | ||||||
IPO, Selling Stockholders | |||||||
Concentration Risk [Line Items] | |||||||
Number of shares issued (in shares) | shares | 20,412,142 | ||||||
Over-Allotment Option | |||||||
Concentration Risk [Line Items] | |||||||
Number of shares issued (in shares) | shares | 5,526,315 | ||||||
United States | |||||||
Concentration Risk [Line Items] | |||||||
Long-lived assets | 7,000 | 7,000 | 4,600 | ||||
Brazil | |||||||
Concentration Risk [Line Items] | |||||||
Long-lived assets | 5,800 | 5,800 | 2,800 | ||||
China | |||||||
Concentration Risk [Line Items] | |||||||
Long-lived assets | 8,100 | 8,100 | 7,600 | ||||
India | |||||||
Concentration Risk [Line Items] | |||||||
Long-lived assets | 7,600 | 7,600 | 5,300 | ||||
Other foreign countries | |||||||
Concentration Risk [Line Items] | |||||||
Long-lived assets | 6,500 | 6,500 | 6,000 | ||||
Non-US | |||||||
Concentration Risk [Line Items] | |||||||
Fixed assets | $ 28,000 | $ 28,000 | $ 21,800 | ||||
Revenue Benchmark | Geographic Concentration Risk | United States | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk | 33.90% | 37.30% | 35.10% | 39.10% | |||
Revenue Benchmark | Geographic Concentration Risk | China | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk | 11.90% | ||||||
Revenue Benchmark | Geographic Concentration Risk | Non-US | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk | 66.00% | 62.00% | 65.00% | 60.00% | |||
Trade Accounts Receivable and Unbilled Accounts Receivable | Geographic Concentration Risk | Non-US | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk | 71.00% | 74.00% | |||||
Assets, Noncurrent | Geographic Concentration Risk | United States | |||||||
Concentration Risk [Line Items] | |||||||
Concentration risk | 20.00% | 17.40% |
Business and Summary of Signi_5
Business and Summary of Significant Accounting Policies - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Cash and Cash Equivalents [Line Items] | ||||
Cash and cash equivalents | $ 452,810 | $ 490,841 | ||
Total cash, cash equivalents, and restricted cash | 480,962 | 492,199 | $ 143,564 | $ 57,156 |
Other Current Assets | ||||
Cash and Cash Equivalents [Line Items] | ||||
Restricted cash | 26,827 | 0 | ||
Other Noncurrent Assets | ||||
Cash and Cash Equivalents [Line Items] | ||||
Restricted cash | $ 1,325 | $ 1,358 |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Revenue by Geographical Location (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 285,051 | $ 196,549 | $ 783,145 | $ 597,082 |
North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 103,769 | 76,649 | 290,954 | 243,797 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 96,500 | $ 73,400 | $ 275,000 | $ 233,500 |
United States | Revenue Benchmark | Geographic Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk | 33.90% | 37.30% | 35.10% | 39.10% |
APAC | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 98,756 | $ 64,457 | $ 260,928 | $ 181,738 |
Australia | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 31,000 | $ 19,700 | $ 83,700 | |
Australia | Revenue Benchmark | Geographic Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk | 10.90% | 10.00% | 10.70% | 10.00% |
China | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 23,400 | |||
China | Revenue Benchmark | Geographic Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk | 11.90% | |||
Europe | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 69,522 | $ 46,623 | $ 196,476 | $ 143,673 |
Germany | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 30,000 | $ 19,800 | $ 84,200 | $ 59,900 |
Germany | Revenue Benchmark | Geographic Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk | 10.50% | 10.10% | 10.70% | 10.00% |
United Kingdom | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 30,000 | $ 20,800 | $ 83,500 | $ 65,700 |
United Kingdom | Revenue Benchmark | Geographic Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Concentration risk | 10.50% | 10.60% | 10.70% | 11.00% |
LATAM | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 13,004 | $ 8,820 | $ 34,787 | $ 27,874 |
Revenue Recognition - Schedul_2
Revenue Recognition - Schedule of Revenue by Contract Type (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 285,051 | $ 196,549 | $ 783,145 | $ 597,082 |
Time-and-material | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 237,533 | 161,202 | 635,608 | 504,710 |
Fixed-price | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 47,518 | 35,319 | 147,537 | 92,029 |
Licensing | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 0 | $ 28 | $ 0 | $ 343 |
Revenue Recognition - Schedul_3
Revenue Recognition - Schedule of Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets included in unbilled receivables | $ 29,264 | $ 19,790 |
Contract liabilities included in deferred revenue | $ 9,054 | $ 11,720 |
Revenue Recognition - Narrative
Revenue Recognition - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue from Contract with Customer [Abstract] | ||||
Revenue recognized | $ 0.5 | $ 0.6 | $ 11.2 | $ 8.2 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2021USD ($)business | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | |
Business Acquisition [Line Items] | |||
Number of businesses acquired | business | 2 | ||
Acquisition of businesses, net of cash acquired | $ 44,759 | $ 0 | |
Gemini Solutions LLC and Fourkind Global OY | |||
Business Acquisition [Line Items] | |||
Gross purchase price | $ 46,600 | ||
Acquisition of businesses, net of cash acquired | 44,800 | ||
Cash acquired from acquisition | $ 1,800 |
Acquisitions - Schedule of Acqu
Acquisitions - Schedule of Acquisition (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 346,831 | $ 318,151 | $ 314,037 | |
Gemini Solutions LLC and Fourkind Global OY | ||||
Business Acquisition [Line Items] | ||||
Customer Relationship | $ 11,100 | |||
Property and Equipment | 259 | |||
Other assets/liabilities, net | 4,228 | |||
Deferred Taxes | (1,646) | |||
Goodwill | 32,615 | |||
Total gross purchase price | $ 46,556 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 318,151 | $ 314,037 |
Additions due to acquisitions | 32,615 | |
Changes due to exchange rates | (3,935) | 4,114 |
Ending balance | $ 346,831 | $ 318,151 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Dec. 31, 2020 | |
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, net | $ 133,923 | |
Total intangible assets, after amortization | 406,923 | $ 404,878 |
Changes due to exchange rates | (5,103) | (2,823) |
Intangible assets, net | 401,820 | 402,055 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived Intangible assets | 273,000 | 273,000 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 177,100 | 166,000 |
Finite-lived intangible assets, accumulated amortization | 43,177 | 34,122 |
Finite-lived intangible assets, net | $ 133,923 | $ 131,878 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Amortization of intangible assets | $ 3.1 | $ 2.7 | $ 9.1 | $ 7.9 | |
Weighted average remaining useful life | 10 years 9 months 18 days | 11 years 10 months 24 days |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Schedule of Estimated Amortization (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 (excluding nine months ended September 30, 2021) | $ 3,075 |
2022 | 12,300 |
2023 | 12,300 |
2024 | 12,300 |
2025 | 12,300 |
Thereafter | 81,648 |
Finite-lived intangible assets, net | $ 133,923 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | (2.60%) | 57.60% | 27.60% | 21.40% |
Redeemable, Convertible Prefe_2
Redeemable, Convertible Preferred Stock (Details) $ / shares in Units, $ in Thousands | Sep. 17, 2021USD ($)shares | Sep. 16, 2021 | Apr. 06, 2021USD ($)$ / shares | Dec. 23, 2020USD ($)shares | Jun. 30, 2021USD ($)shares | Jan. 31, 2021USD ($)shares | Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2021USD ($)$ / sharesshares | Dec. 31, 2020shares | Sep. 30, 2020shares | Jun. 30, 2020shares | Dec. 31, 2019shares |
Temporary Equity [Line Items] | ||||||||||||
Liquidation event period | 2 years | |||||||||||
Preferred internal return rate | 10.00% | |||||||||||
Dividends | $ | $ 325,000 | |||||||||||
Dividends, taxes withheld | $ | $ 10,000 | |||||||||||
Dividends per share (in dollars per share) | $ / shares | $ 50.71 | |||||||||||
Dividends, preferred shareholders | $ | $ 59,600 | |||||||||||
Issuance of redeemable convertible preferred stock (in shares) | 35,996,412 | |||||||||||
Issuance of redeemable convertible preferred stock | $ | $ 503,222 | |||||||||||
Stock issuance costs | $ | $ 30,300 | |||||||||||
Stock split, conversion ratio | 43.6 | |||||||||||
Redeemable convertible preferred stock, conversion ratio | 1 | |||||||||||
Common stock issued upon conversion of convertible securities (in shares) | 59,489,958 | |||||||||||
Stock issued during period, value, conversion of convertible securities | $ | $ 826,000 | $ 826,022 | $ 826,022 | |||||||||
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 | ||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||||||||||
Redeemable, convertible preferred stock, shares issued (in shares) | 0 | 0 | ||||||||||
Redeemable, convertible preferred stock, shares outstanding (in shares) | 59,489,958 | 0 | 0 | 23,493,546 | 0 | 0 | 0 | |||||
Voting Series A Preferred Stock | ||||||||||||
Temporary Equity [Line Items] | ||||||||||||
Shares authorized (in shares) | 2,500,000 | 2,500,000 | ||||||||||
Issuance of redeemable convertible preferred stock (in shares) | 539,084 | 637,098 | ||||||||||
Issuance of redeemable convertible preferred stock | $ | $ 322,800 | $ 381,000 | ||||||||||
Stock issuance costs | $ | $ 7,200 | $ 9,000 | ||||||||||
Non-Voting Series A Preferred Stock | ||||||||||||
Temporary Equity [Line Items] | ||||||||||||
Shares authorized (in shares) | 2,500,000 | 2,500,000 | ||||||||||
Voting Series B Preferred Stock | ||||||||||||
Temporary Equity [Line Items] | ||||||||||||
Shares authorized (in shares) | 500,000 | 500,000 | ||||||||||
Issuance of redeemable convertible preferred stock (in shares) | 188,876 | |||||||||||
Issuance of redeemable convertible preferred stock | $ | $ 125,000 | |||||||||||
Stock issuance costs | $ | $ 2,800 | |||||||||||
Non-Voting Series B Preferred Stock | ||||||||||||
Temporary Equity [Line Items] | ||||||||||||
Shares authorized (in shares) | 500,000 | 500,000 |
Tender Offer (Details)
Tender Offer (Details) $ in Thousands | Sep. 16, 2021 | Mar. 31, 2021USD ($)shares | Sep. 30, 2021USD ($) |
Class of Stock [Line Items] | |||
Treasury stock acquired (in shares) | shares | 1,156,775 | ||
Treasury stock, acquired | $ 720,000 | ||
Stock split, conversion ratio | 43.6 | ||
Tender offer | $ 717,429 | ||
Treasury stock acquired, tax withheld | 19,300 | ||
Additional compensation expense | 2,700 | ||
Distribution of retained earnings in excess of fair value | $ 79,200 | ||
Common Class A | |||
Class of Stock [Line Items] | |||
Treasury stock acquired (in shares) | shares | 1,138,537 | ||
Common Class B | |||
Class of Stock [Line Items] | |||
Treasury stock acquired (in shares) | shares | 12,979 | ||
Common Class C | |||
Class of Stock [Line Items] | |||
Treasury stock acquired (in shares) | shares | 5,259 |
(Loss) Earnings Per Common Sh_2
(Loss) Earnings Per Common Share - Narrative (Details) | Sep. 17, 2021 | Sep. 16, 2021 |
Earnings Per Share [Abstract] | ||
Stock split, conversion ratio | 43.6 | |
Redeemable convertible preferred stock, conversion ratio | 1 |
(Loss) Earnings Per Common Sh_3
(Loss) Earnings Per Common Share - Schedule of (Loss) Earnings per Share (Details) $ / shares in Units, $ in Thousands | Sep. 17, 2021 | Sep. 16, 2021 | Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2020USD ($)$ / sharesshares | Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2020USD ($)$ / sharesshares |
Basic (loss) earnings per common share: | ||||||
Net (loss) income | $ | $ (25,235) | $ 21,882 | $ 11,502 | $ 59,679 | ||
Preferred stock dividends | $ | 0 | 0 | (59,642) | 0 | ||
Net (loss) income allocated to common shareholders – Basic | $ | $ (25,235) | $ 21,882 | $ (48,140) | $ 59,679 | ||
Weighted average shares outstanding, basic (in shares) | shares | 241,351,052 | 278,218,732 | 237,121,811 | 278,202,291 | ||
Basic (loss) earnings per common share (in USD per share) | $ / shares | $ (0.10) | $ 0.08 | $ (0.20) | $ 0.21 | ||
Diluted (loss) earnings per common share: | ||||||
Net (loss) income allocated to common shareholders – Basic | $ | $ (25,235) | $ 21,882 | $ (48,140) | $ 59,679 | ||
Weighted average shares outstanding, basic (in shares) | shares | 241,351,052 | 278,218,732 | 237,121,811 | 278,202,291 | ||
Dilutive effect of: | ||||||
Employee stock options and restricted common shares (in shares) | shares | 0 | 6,855,016 | 0 | 5,962,757 | ||
Weighted average shares outstanding, diluted (in shares) | shares | 241,351,052 | 285,073,748 | 237,121,811 | 284,165,048 | ||
Diluted (loss) earnings per common share (in USD per share) | $ / shares | $ (0.10) | $ 0.08 | $ (0.20) | $ 0.21 | ||
Stock split, conversion ratio | 43.6 | |||||
Sponsor return | 2.8 |
(Loss) Earnings Per Common Sh_4
(Loss) Earnings Per Common Share - Schedule of Antidilutive Securities Excluded From Computation of Earnings Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of Earnings Per Share | 20,968,124 | 0 | 20,839,475 | 0 |
Restricted Stock Units (RSUs) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of Earnings Per Share | 2,683,513 | 0 | 897,793 | 0 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2021 (excluding nine months ended September 30, 2021) | $ 3,522 |
2022 | 17,783 |
2023 | 15,061 |
2024 | 13,123 |
2025 | 11,699 |
Thereafter | 10,069 |
Total future minimum lease payments | $ 71,257 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Operating leases, rent expense | $ 4.9 | $ 4.7 | $ 14.5 | $ 14 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) $ / shares in Units, $ in Thousands | Sep. 17, 2021$ / sharesshares | Sep. 09, 2021 | Sep. 30, 2021USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock, shares reserved for future issuance (in shares) | shares | 62,048,123 | ||
Lock-up restriction period | 1 year | ||
Lock-up restrictions, percent of option that will lapse | 50.00% | ||
Lock-up restriction, period following offering | 6 months | ||
Sponsor return | 2.8 | ||
Stock-based compensation expense, accelerated cost | $ 54,000 | ||
Liquidity event, triggering event, percent of ownership sold | 75.00% | ||
Common stock issued upon conversion of convertible securities (in shares) | shares | 59,489,958 | ||
IPO | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Price per share of common stock (in dollars per share) | $ / shares | $ 21 | ||
Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 4 years | ||
Company repurchase, exercisable period | 48 months | ||
Compensation costs not yet recognized | $ 10,300 | ||
Compensation costs, weighted average period of recognition | 1 year 14 days | ||
Performance Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Service period | 18 months | ||
RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation costs, weighted average period of recognition | 1 year 4 months 24 days | ||
Common stock issued upon conversion of convertible securities (in shares) | shares | 6,701,133 | ||
Compensation costs, (other than options) not yet recognized | $ 227,500 | ||
Tranche One | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 37.50% | ||
Service period | 18 months | ||
Tranche One | Stock Appreciation Rights (SARs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 6 months | ||
Tranche One | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 50.00% | ||
Tranche Two | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Two | Stock Appreciation Rights (SARs) | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 12 months | ||
Tranche Two | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 50.00% | ||
Tranche Three | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Four | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Five | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Six | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Seven | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Eight | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Nine | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Ten | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Tranche Eleven | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 6.25% | ||
Service period | 3 months | ||
Vesting Upon Change Of Control | Time Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 100.00% | ||
Return Of Two Times Sponsor Investment | Performance Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 50.00% | ||
Return Of Two And A Half Times Sponsor Investment | Performance Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 75.00% | ||
Return Of Three Times Sponsor Investment | Performance Vesting Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 100.00% | ||
Cliff Vesting Subsequent To IPO Closing Date, Tranche One | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 28 months | ||
Cliff Vesting Subsequent To IPO Closing Date, Tranche Two | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 12 months | ||
Vesting Subsequent To IPO Closing Date, Tranche One | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 6 months | ||
Performance vesting option | 50.00% | ||
Vesting Subsequent To IPO Closing Date, Tranche Two | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 12 months | ||
Performance vesting option | 50.00% | ||
Share Based Payment Arrangement, Ratable Vesting Subsequent To IPO Closing | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Share Based Payment Arrangement, Ratable Vesting Subsequent To IPO Closing, Tranche One | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 34.00% | ||
Share Based Payment Arrangement, Ratable Vesting Subsequent To IPO Closing, Tranche Two | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 33.00% | ||
Share Based Payment Arrangement, Ratable Vesting Subsequent To IPO Closing, Tranche Three | RSU's | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Performance vesting option | 33.00% | ||
Achievement of Sponsor Return Hurdles Met Upon Completion of Initial Public Offering, Grant Date Fair Value | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense, accelerated cost | $ 15,900 | ||
Achievement of Sponsor Return Hurdles Met Upon Completion of Initial Public Offering, Fair Value Of Initial Public Offering Price | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense, accelerated cost | $ 38,100 |
Stock-Based Compensation- Sched
Stock-Based Compensation- Schedule of Option Activity (Details) $ / shares in Units, $ in Thousands | Sep. 16, 2021 | Sep. 30, 2021USD ($)$ / sharesshares | Sep. 30, 2021USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares |
Options | ||||
Granted (in shares) | 0 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||
Stock split, conversion ratio | 43.6 | |||
Time Vesting Shares | ||||
Options | ||||
Beginning balance (in shares) | 10,462,531 | |||
Granted (in shares) | 1,068,283 | |||
Forfeited (in shares) | (134,135) | |||
Exercised (in shares) | (966,005) | |||
Cancelled (in shares) | (1,752,878) | |||
Expired (in shares) | 0 | |||
Ending balance (in shares) | 8,677,796 | 8,677,796 | 10,462,531 | |
Exercisable (in shares) | 5,585,354 | 5,585,354 | ||
Nonvested (in shares) | 3,092,442 | 3,092,442 | ||
Weighted Average Exercise Price | ||||
Beginning balance (in dollars per share) | $ / shares | $ 2.76 | |||
Granted (in dollars per share) | $ / shares | 14.05 | |||
Forfeited (in dollars per share) | $ / shares | 5.32 | |||
Exercised (in dollars per share) | $ / shares | 2.36 | |||
Cancelled (in dollars per share) | $ / shares | 2.88 | |||
Ending balance (in dollars per share) | $ / shares | $ 4.13 | 4.13 | $ 2.76 | |
Weighted average exercise price, Exercisable (in dollars per share) | $ / shares | 2.46 | 2.46 | ||
Weighted average exercise price, Nonvested (in dollars per share) | $ / shares | $ 7.14 | $ 7.14 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||
Aggregate Intrinsic Value | $ | $ 20,033 | $ 20,033 | $ 12,149 | |
Aggregate Intrinsic Value, Exercisable | $ | 3,729 | 3,729 | ||
Aggregate Intrinsic Value, Nonvested | $ | $ 16,304 | $ 16,304 | ||
Weighted-average period of recognition | 1 year 14 days | 1 year 4 months 9 days | ||
Weighted Average Remaining Contractual Term, Exercisable | 4 months 2 days | |||
Weighted Average Remaining Contractual Term, Nonvested | 2 years 3 months 14 days | |||
Performance Vesting Shares | ||||
Options | ||||
Beginning balance (in shares) | 15,440,716 | |||
Granted (in shares) | 1,397,260 | |||
Forfeited (in shares) | (193,681) | |||
Exercised (in shares) | (187,943) | |||
Cancelled (in shares) | (1,009,831) | |||
Expired (in shares) | 0 | |||
Ending balance (in shares) | 15,446,521 | 15,446,521 | 15,440,716 | |
Exercisable (in shares) | 15,446,521 | 15,446,521 | ||
Nonvested (in shares) | 0 | 0 | ||
Weighted Average Exercise Price | ||||
Beginning balance (in dollars per share) | $ / shares | $ 2.66 | |||
Granted (in dollars per share) | $ / shares | 14.05 | |||
Forfeited (in dollars per share) | $ / shares | 4.92 | |||
Exercised (in dollars per share) | $ / shares | 2.38 | |||
Cancelled (in dollars per share) | $ / shares | 3.60 | |||
Ending balance (in dollars per share) | $ / shares | $ 3.60 | 3.60 | $ 2.66 | |
Weighted average exercise price, Exercisable (in dollars per share) | $ / shares | 3.60 | 3.60 | ||
Weighted average exercise price, Nonvested (in dollars per share) | $ / shares | $ 0 | $ 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||
Aggregate Intrinsic Value | $ | $ 24,776 | $ 24,776 | $ 12,498 | |
Aggregate Intrinsic Value, Exercisable | $ | 24,776 | 24,776 | ||
Aggregate Intrinsic Value, Nonvested | $ | $ 0 | $ 0 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Valuation Assumptions (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grants in period (in shares) | 0 | |||
Employee stock options and common shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Risk-free interest rate | 0.00% | 0.10% | 0.10% | 0.10% |
Dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Expected volatility | 0.00% | 55.00% | 55.00% | 55.00% |
Expected term (years) | 0 years | 2 years | 1 year | 2 years |
Stock-Based Compensation- Sch_2
Stock-Based Compensation- Schedule of Stock Appreciation Rights Activity (Details) | Sep. 16, 2021 | Sep. 30, 2021$ / sharesshares | Dec. 31, 2020$ / sharesshares |
Weighted Average Grant Date Fair Value | |||
Outstanding (in dollars per share) | $ / shares | $ 3.47 | $ 0 | |
Granted (in dollars per share) | $ / shares | 14.05 | ||
Forfeited (in dollars per share) | $ / shares | 5.77 | ||
Intrinsic Value Adjustment (in dollars per share) | $ / shares | 12.19 | ||
SARs Conversion (in dollars per share) | $ / shares | $ 21 | ||
Stock split, conversion ratio | 43.6 | ||
Stock Appreciation Rights (SARs) | |||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Outstanding [Roll Forward] | |||
Beginning balance (in shares) | shares | 9,032,006 | ||
Granted (in shares) | shares | 3,096,082 | ||
Forfeited (in shares) | shares | (1,681,980) | ||
Intrinsic Value Adjustment (in shares) | shares | (3,744,975) | ||
SARs Conversion (in shares) | shares | (6,701,133) | ||
Ending balance (in shares) | shares | 0 | 9,032,006 | |
Weighted Average Grant Date Fair Value | |||
Incremental value (in dollars per share) | $ / shares | $ 100 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Restricted Stock Units Activity (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Restricted Stock Units (RSUs) | |
Number of Restricted Stock Units | |
Beginning balance (in shares) | 0 |
Granted (in shares) | 5,017,572 |
Granted - SARs conversion (in shares) | 6,701,133 |
Forfeited (in shares) | (90,148) |
Vested (in shares) | 0 |
Ending balance (in shares) | 11,628,557 |
Weighted Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 21 |
Granted - SARs conversion (in dollars per share) | $ / shares | 21 |
Forfeited (in dollars per share) | $ / shares | 21 |
Vested (in dollars per share) | $ / shares | 0 |
Ending balance (in dollars per share) | $ / shares | $ 21 |
Restricted Stock Units, State Administration Of Foreign Exchange Of The People's Republic Of China | |
Number of Restricted Stock Units | |
Granted (in shares) | 3,878,909 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | Sep. 17, 2021$ / sharesshares | Sep. 16, 2021shares | Sep. 30, 2021$ / sharesshares |
Equity [Abstract] | |||
Conversion of convertible securities, before stock split (in shares) | 1,365,058 | ||
Stock split, conversion ratio | 43.6 | ||
Preferred stock, shares authorized (in shares) | 100,000,000 | ||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | ||
Common stock redesignated (in shares) | 5,259,163 | ||
Stock redesignation, conversion ratio | 1 | ||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |
Common stock, shares authorized (in shares) | 1,000,000,000 | ||
Common stock, shares outstanding (in shares) | 305,117,043 |
Credit Agreements - Narrative (
Credit Agreements - Narrative (Details) - USD ($) | Aug. 10, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Mar. 26, 2021 | Dec. 31, 2020 | May 13, 2019 | Oct. 12, 2017 |
Debt Instrument [Line Items] | |||||||||
Interest rate during period | 3.50% | 4.80% | |||||||
Interest expense | $ 6,300,000 | $ 5,600,000 | $ 18,700,000 | $ 18,400,000 | |||||
Credit Agreements | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt issuance costs, gross | 7,100,000 | $ 7,100,000 | |||||||
Credit Agreements | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument, face amount | $ 715,000,000 | $ 200,000,000 | |||||||
Installment payments, percent of original principal amount | 1.00% | ||||||||
Repayments of debt | $ 100,000,000 | ||||||||
Credit Agreements | London Interbank Offered Rate (LIBOR) | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Variable rate | 3.25% | ||||||||
Credit Agreements | Base Rate | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Variable rate | 2.25% | ||||||||
Revolving Credit Facility | Credit Agreements | Line of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Credit facility | $ 165,000,000 | $ 85,000,000 | $ 35,000,000 | ||||||
Outstanding draws | $ 0 | $ 0 | $ 0 |
Credit Agreements - Schedule of
Credit Agreements - Schedule of Credit Facilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Disclosure [Abstract] | ||
Long-term debt, less current portion | $ 604,275 | $ 440,497 |
Capitalized deferred financing fees | (7,271) | (5,305) |
Long-term debt | 597,004 | 435,192 |
Current portion of long-term debt | 7,150 | 4,565 |
Total debt carrying value | $ 604,154 | $ 439,757 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accrued interest expense | $ 86 | $ 85 |
Accrued employee expense | 2,123 | 1,786 |
Accrued travel expense | 432 | 383 |
Operating lease expenses | 324 | 212 |
Insurance charges | 167 | 257 |
Professional fees | 12,008 | 10,320 |
Withholding taxes payable | 34,489 | 43 |
Other taxes payable | 10,248 | 8,643 |
Rebates payable | 599 | 2,307 |
Other accrued expenses | 4,646 | 5,713 |
Accrued expenses | $ 65,122 | $ 29,749 |
Subsequent Events (Details)
Subsequent Events (Details) - Credit Agreements - Secured Debt - USD ($) $ in Millions | Oct. 20, 2021 | Aug. 10, 2021 |
Subsequent Event [Line Items] | ||
Repayments of debt | $ 100 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Repayments of debt | $ 100 |