(State or other jurisdiction of incorporation or organization) | (I.R.S Employer Identification No.) |
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading symbol(s) | Name of exchange on which registered | ||||||
ý | Accelerated filer | ☐ | ||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||
Emerging growth company |
Page | |||||
September 30, | December 31, | |||||||||||||
2022 | 2021 | |||||||||||||
Assets | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Fees receivable, net | ||||||||||||||
Prepaid expenses and other current assets | ||||||||||||||
Total current assets | ||||||||||||||
Property and equipment, net | ||||||||||||||
Internally developed software, net | ||||||||||||||
Intangible assets, net | ||||||||||||||
Goodwill | ||||||||||||||
Operating lease right-of-use assets, net | ||||||||||||||
Other non-current assets | ||||||||||||||
Total assets | $ | $ | ||||||||||||
Liabilities and Equity | ||||||||||||||
Current liabilities: | ||||||||||||||
Accrued expenses and other liabilities | $ | $ | ||||||||||||
Accounts payable | ||||||||||||||
Operating lease liabilities | ||||||||||||||
Deferred revenue | ||||||||||||||
Current portion of long-term debt | ||||||||||||||
Total current liabilities | ||||||||||||||
Long-term debt, net of current portion | ||||||||||||||
Non-current operating lease liabilities | ||||||||||||||
Deferred tax liabilities, net | ||||||||||||||
Other non-current liabilities | ||||||||||||||
Total liabilities | ||||||||||||||
Commitments and contingencies | ||||||||||||||
Equity: | ||||||||||||||
Stockholders’ equity: | ||||||||||||||
Preferred stock, par value $ | ||||||||||||||
Common stock, par value $ | ||||||||||||||
Additional paid-in capital | ||||||||||||||
Accumulated deficit | ( | ( | ||||||||||||
Treasury stock at cost, | ( | ( | ||||||||||||
Accumulated other comprehensive loss | ( | ( | ||||||||||||
Total stockholders’ equity | ||||||||||||||
Non-controlling interest | ( | |||||||||||||
Total equity | ||||||||||||||
Total liabilities and equity | $ | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||
Asset-based | $ | $ | $ | $ | ||||||||||||||||||||||
Subscription-based | ||||||||||||||||||||||||||
Total recurring revenues | ||||||||||||||||||||||||||
Professional services and other revenues | ||||||||||||||||||||||||||
Total revenues | ||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||
Cost of revenues | ||||||||||||||||||||||||||
Compensation and benefits | ||||||||||||||||||||||||||
General and administration | ||||||||||||||||||||||||||
Depreciation and amortization | ||||||||||||||||||||||||||
Total operating expenses | ||||||||||||||||||||||||||
Income (loss) from operations | ( | ( | ||||||||||||||||||||||||
Other expense, net | ( | ( | ( | ( | ||||||||||||||||||||||
Income (loss) before income tax provision (benefit) | ( | ( | ||||||||||||||||||||||||
Income tax provision (benefit) | ( | ( | ||||||||||||||||||||||||
Net income (loss) | ( | ( | ||||||||||||||||||||||||
Add: Net loss attributable to non-controlling interest | ||||||||||||||||||||||||||
Net income (loss) attributable to Envestnet, Inc. | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Net income (loss) per share attributable to Envestnet, Inc.: | ||||||||||||||||||||||||||
Basic | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Diluted | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||
Diluted |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
Net income (loss) attributable to Envestnet, Inc. | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Foreign currency translation gains (losses), net of taxes | ( | ( | ( | |||||||||||||||||||||||
Comprehensive income (loss) attributable to Envestnet, Inc. | $ | ( | $ | $ | ( | $ |
Accumulated | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional | Other | Non- | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Common | Paid-in | Comprehensive | Accumulated | controlling | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Loss | Deficit | Interest | Equity | ||||||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2021 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock - vesting of restricted stock units | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholdings | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation loss, net of taxes | — | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2022 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock - vesting of restricted stock units | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholdings | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share repurchases | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation loss, net of taxes | — | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2022 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
Accumulated | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional | Other | Non- | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Common | Paid-in | Comprehensive | Accumulated | controlling | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Loss | Deficit | Interest | Equity | ||||||||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2022 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock - vesting of restricted stock units | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholdings | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation loss, net of taxes | — | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, September 30, 2022 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ |
Accumulated | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional | Other | Non- | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Common | Paid-in | Comprehensive | Accumulated | controlling | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Loss | Deficit | Interest | Equity | ||||||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2020 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||||
Adoption of ASU 2020-06, net of taxes of $ | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock - vesting of restricted stock units | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholdings | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share repurchase | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation loss, net of taxes | — | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance, March 31, 2021 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock - vesting of restricted stock units | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholdings | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Share repurchase | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Capital contribution - non-controlling interest | — | — | — | — | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation loss, net of taxes | — | — | — | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2021 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
Accumulated | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional | Other | Non- | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Common | Paid-in | Comprehensive | Accumulated | controlling | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Capital | Loss | Deficit | Interest | Equity | ||||||||||||||||||||||||||||||||||||||||||||||||
Balance, June 30, 2021 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock - vesting of restricted stock units | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld to satisfy tax withholdings | — | — | ( | ( | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||
Capital contribution - non-controlling interest | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Foreign currency translation gain, net of taxes | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
Balance, September 30, 2021 | $ | ( | $ | ( | $ | $ | ( | $ | ( | $ | $ |
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
OPERATING ACTIVITIES: | ||||||||||||||
Net income (loss) | $ | ( | $ | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||
Depreciation and amortization | ||||||||||||||
Provision for doubtful accounts | ( | |||||||||||||
Deferred income taxes | ( | |||||||||||||
Release of uncertain tax positions | ( | |||||||||||||
Non-cash compensation expense | ||||||||||||||
Non-cash interest expense | ||||||||||||||
Accretion on contingent consideration and purchase liability | ||||||||||||||
Payments of contingent consideration | ( | |||||||||||||
Fair market value adjustment to contingent consideration liability | ( | |||||||||||||
Fair market value adjustment to investment in private company | ( | |||||||||||||
Gain on settlement of liability | ( | |||||||||||||
Loss allocations from equity method investments | ||||||||||||||
Dilution gain on equity method investee share issuance | ( | |||||||||||||
Lease related impairments, including right of use assets | ||||||||||||||
Loss on property and equipment disposals - office closures | ||||||||||||||
Other | ||||||||||||||
Changes in operating assets and liabilities, net of acquisitions: | ||||||||||||||
Fees receivable, net | ( | |||||||||||||
Prepaid expenses and other current assets | ( | |||||||||||||
Other non-current assets | ( | |||||||||||||
Accrued expenses and other liabilities | ( | |||||||||||||
Accounts payable | ( | |||||||||||||
Deferred revenue | ( | ( | ||||||||||||
Other non-current liabilities | ( | ( | ||||||||||||
Net cash provided by operating activities | ||||||||||||||
INVESTING ACTIVITIES: | ||||||||||||||
Purchases of property and equipment | ( | ( | ||||||||||||
Capitalization of internally developed software | ( | ( | ||||||||||||
Acquisition of proprietary technology | ( | ( | ||||||||||||
Acquisitions of businesses, net of cash acquired | ( | ( | ||||||||||||
Investments in private companies | ( | ( | ||||||||||||
Advance for technology solutions | ( | ( | ||||||||||||
Issuance of notes receivable to equity method investees | ( | |||||||||||||
Net cash used in investing activities | ( | ( | ||||||||||||
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
FINANCING ACTIVITIES: | ||||||||||||||
Proceeds from exercise of stock options | ||||||||||||||
Capital contributions - non-controlling shareholders | ||||||||||||||
Taxes paid in lieu of shares issued for stock-based compensation | ( | ( | ||||||||||||
Finance lease payments | ( | |||||||||||||
Share repurchases | ( | ( | ||||||||||||
Revolving credit facility issuance costs | ( | |||||||||||||
Payments of contingent consideration | ( | ( | ||||||||||||
Other | ( | |||||||||||||
Net cash used in financing activities | ( | ( | ||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | ( | ( | ||||||||||||
INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | ( | |||||||||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD | ||||||||||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (See Note 2) | $ | $ | ||||||||||||
Supplemental disclosure of cash flow information - net cash paid during the period for income taxes | $ | $ | ||||||||||||
Supplemental disclosure of cash flow information - cash paid during the period for interest | ||||||||||||||
Supplemental disclosure of non-cash operating, investing and financing activities: | ||||||||||||||
Purchase liabilities included in other non-current liabilities | ||||||||||||||
Fixed assets acquired through finance lease | ||||||||||||||
Purchase of fixed assets included in accounts payable and accrued expenses and other liabilities | ||||||||||||||
Internally developed software costs included in accrued expenses and other liabilities | ||||||||||||||
Membership interest liabilities included in other non-current liabilities | ||||||||||||||
Leasehold improvements funded by lease incentive | ||||||||||||||
Assets obtained in exchange for lease liabilities, net | ||||||||||||||
Conversion of equity method investee loan to shares | ||||||||||||||
September 30, | September 30, | |||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Cash and cash equivalents | $ | $ | ||||||||||||
Restricted cash included in prepaid expenses and other current assets | ||||||||||||||
Total cash, cash equivalents and restricted cash | $ | $ |
Preliminary Estimate | Measurement Period Adjustments | Revised Estimate | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Tangible assets acquired, net of acquired cash | $ | $ | $ | |||||||||||||||||
Identifiable intangible assets | — | |||||||||||||||||||
Goodwill | ||||||||||||||||||||
Total net assets acquired | $ | $ | $ |
Preliminary Estimate (in thousands) | Estimated Useful Life in Years | Amortization Method | ||||||||||||||||||
Proprietary technology | $ | Straight-line |
Preliminary Estimate | ||||||||
(in thousands) | ||||||||
Tangible net assets acquired, net of acquired cash | $ | |||||||
Identifiable intangible assets | ||||||||
Goodwill | ||||||||
Total net assets acquired | $ |
Preliminary Estimate (in thousands) | Estimated Useful Life in Years | Amortization Method | ||||||||||||||||||
Proprietary technology | $ | Straight-line |
(in thousands) | ||||||||
Cash consideration, net | $ | |||||||
Estimated working capital adjustment | ( | |||||||
Total | $ | |||||||
Preliminary Estimate | ||||||||
(in thousands) | ||||||||
Total current assets | $ | |||||||
Other non-current assets | ||||||||
Identifiable intangible assets | ||||||||
Goodwill | ||||||||
Total assets acquired | ||||||||
Accounts payable and accrued expenses | ( | |||||||
Operating lease liabilities | ( | |||||||
Deferred revenue | ( | |||||||
Total liabilities assumed | ( | |||||||
Total net assets acquired, net of cash received | $ |
Preliminary Estimate (in thousands) | Estimated Useful Life in Years | Amortization Method | ||||||||||||||||||
Customer lists | $ | Accelerated | ||||||||||||||||||
Proprietary technologies | Straight-line | |||||||||||||||||||
Trade names | Straight-line | |||||||||||||||||||
Total intangible assets acquired | $ |
September 30, | December 31, | |||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Prepaid technology | $ | $ | ||||||||||||
Non-income tax receivables | ||||||||||||||
Acquisition related receivables | ||||||||||||||
Prepaid insurance | ||||||||||||||
Income tax prepayments and receivables | ||||||||||||||
Loan to equity method investee | ||||||||||||||
Other | ||||||||||||||
Total prepaid expenses and other current assets | $ | $ |
September 30, | December 31, | |||||||||||||||||||
Estimated Useful Life | 2022 | 2021 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Cost: | ||||||||||||||||||||
Computer equipment and software | $ | $ | ||||||||||||||||||
Leasehold improvements | Shorter of the lease term or useful life of the asset | |||||||||||||||||||
Leased data servers | ||||||||||||||||||||
Office furniture and fixtures | ||||||||||||||||||||
Office equipment and other | ||||||||||||||||||||
Building and building improvements | ||||||||||||||||||||
Land | Not applicable | |||||||||||||||||||
Less: accumulated depreciation and amortization | ( | ( | ||||||||||||||||||
Total property and equipment, net | $ | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Depreciation and amortization expense | $ | $ | $ | $ |
September 30, | December 31, | |||||||||||||||||||
Estimated Useful Life | 2022 | 2021 | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Internally developed software | $ | $ | ||||||||||||||||||
Less: accumulated amortization | ( | ( | ||||||||||||||||||
Internally developed software, net | $ | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Amortization expense | $ | $ | $ | $ |
Envestnet Wealth Solutions | Envestnet Data & Analytics | Total | ||||||||||||||||||
(in thousands) | ||||||||||||||||||||
Balance at December 31, 2021 | $ | $ | $ | |||||||||||||||||
401kplans.com acquisition | ||||||||||||||||||||
Truelytics acquisition | ||||||||||||||||||||
Redi2 Technologies acquisition | ||||||||||||||||||||
Foreign currency translation | ( | ( | ||||||||||||||||||
Balance at September 30, 2022 | $ | $ | $ |
September 30, 2022 | December 31, 2021 | |||||||||||||||||||||||||||||||||||||
Gross | Net | Gross | Net | |||||||||||||||||||||||||||||||||||
Carrying | Accumulated | Carrying | Carrying | Accumulated | Carrying | |||||||||||||||||||||||||||||||||
Amount | Amortization | Amount | Amount | Amortization | Amount | |||||||||||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||||||||||||
Customer lists | $ | $ | ( | $ | $ | $ | ( | $ | ||||||||||||||||||||||||||||||
Proprietary technologies | ( | ( | ||||||||||||||||||||||||||||||||||||
Trade names | ( | ( | ||||||||||||||||||||||||||||||||||||
Total intangible assets | $ | $ | ( | $ | $ | $ | ( | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Amortization expense | $ | $ | $ | $ |
Years ending December 31, | (in thousands) | |||||||
Remainder of 2022 | $ | |||||||
2023 | ||||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
Thereafter | ||||||||
Total | $ |
September 30, | December 31, | |||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Accrued investment manager fees | $ | $ | ||||||||||||
Accrued compensation and related taxes | ||||||||||||||
Accrued professional services | ||||||||||||||
Accrued technology | ||||||||||||||
Non-income tax payables | ||||||||||||||
Other accrued expenses | ||||||||||||||
Total accrued expenses and other liabilities | $ | $ |
September 30, | December 31, | |||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Revolving credit facility balance | $ | $ | ||||||||||||
Convertible Notes due 2023 | $ | $ | ||||||||||||
Unamortized issuance costs on Convertible Notes due 2023 | ( | ( | ||||||||||||
Convertible Notes due 2023 carrying value | $ | $ | ||||||||||||
Convertible Notes due 2025 | $ | $ | ||||||||||||
Unamortized issuance costs on Convertible Notes due 2025 | ( | ( | ||||||||||||
Convertible Notes due 2025 carrying value | $ | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Coupon interest | $ | $ | $ | $ | ||||||||||||||||||||||
Amortization of issuance costs | ||||||||||||||||||||||||||
Undrawn and other fees | ||||||||||||||||||||||||||
Total interest expense | $ | $ | $ | $ |
September 30, 2022 | ||||||||||||||||||||||||||
Fair Value | Level I | Level II | Level III | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Money market funds | $ | $ | $ | $ | ||||||||||||||||||||||
Assets to fund deferred compensation liability | ||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | ||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Deferred compensation liability | ||||||||||||||||||||||||||
Total liabilities | $ | $ | $ | $ |
December 31, 2021 | ||||||||||||||||||||||||||
Fair Value | Level I | Level II | Level III | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Money market funds | $ | $ | $ | $ | ||||||||||||||||||||||
Assets to fund deferred compensation liability | ||||||||||||||||||||||||||
Total assets | $ | $ | $ | $ | ||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Contingent consideration | $ | $ | $ | $ | ||||||||||||||||||||||
Deferred compensation liability | ||||||||||||||||||||||||||
Total liabilities | $ | $ | $ | $ |
Fair Value of Assets to Fund Deferred Compensation Liability | ||||||||
(in thousands) | ||||||||
Balance at December 31, 2021 | $ | |||||||
Contributions | ||||||||
Fair value adjustments and fees | ( | |||||||
Balance at September 30, 2022 | $ |
Three Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||||||||||||||||||||
Envestnet Wealth Solutions | Envestnet Data & Analytics | Consolidated | Envestnet Wealth Solutions | Envestnet Data & Analytics | Consolidated | |||||||||||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Asset-based | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Subscription-based | ||||||||||||||||||||||||||||||||||||||
Total recurring revenues | ||||||||||||||||||||||||||||||||||||||
Professional services and other revenues | ||||||||||||||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | $ | $ |
Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||||||||||||||||||||
Envestnet Wealth Solutions | Envestnet Data & Analytics | Consolidated | Envestnet Wealth Solutions | Envestnet Data & Analytics | Consolidated | |||||||||||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Asset-based | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Subscription-based | ||||||||||||||||||||||||||||||||||||||
Total recurring revenues | ||||||||||||||||||||||||||||||||||||||
Professional services and other revenues | ||||||||||||||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ | $ | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
United States | $ | $ | $ | $ | ||||||||||||||||||||||
International | ||||||||||||||||||||||||||
Total revenues | $ | $ | $ | $ |
Years ending December 31, | (in thousands) | |||||||
Remainder of 2022 | $ | |||||||
2023 | ||||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
Thereafter | ||||||||
Total | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Asset-based | $ | $ | $ | $ | ||||||||||||||||||||||
Subscription-based | ||||||||||||||||||||||||||
Professional services and other | ( | |||||||||||||||||||||||||
Total cost of revenues | $ | $ | $ | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Stock-based compensation expense | $ | $ | $ | $ | ||||||||||||||||||||||
Tax effect on stock-based compensation expense | ( | ( | ( | ( | ||||||||||||||||||||||
Net effect on income | $ | $ | $ | $ |
Weighted-Average | ||||||||||||||||||||||||||
Weighted- | Remaining | |||||||||||||||||||||||||
Average | Contractual Life | Aggregate | ||||||||||||||||||||||||
Options | Exercise Price | (Years) | Intrinsic Value | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Outstanding as of December 31, 2021 | $ | $ | ||||||||||||||||||||||||
Exercised | ( | |||||||||||||||||||||||||
Forfeited | ( | |||||||||||||||||||||||||
Outstanding as of September 30, 2022 | ||||||||||||||||||||||||||
Options exercisable | $ | $ |
RSUs | PSUs | |||||||||||||||||||||||||
Number of Shares | Weighted- Average Grant Date Fair Value per Share | Number of Shares | Weighted- Average Grant Date Fair Value per Share | |||||||||||||||||||||||
Outstanding as of December 31, 2021 | $ | $ | ||||||||||||||||||||||||
Granted | ||||||||||||||||||||||||||
Vested | ( | ( | ||||||||||||||||||||||||
Forfeited | ( | ( | ||||||||||||||||||||||||
Outstanding as of September 30, 2022 | ||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands, except for effective tax rate) | ||||||||||||||||||||||||||
Income (loss) before income tax provision (benefit) | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Income tax provision (benefit) | ( | ( | ||||||||||||||||||||||||
Effective tax rate | ( | % | ( | % | % | % |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands, except share and per share data) | ||||||||||||||||||||||||||
Net income (loss) attributable to Envestnet, Inc. (a) | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Weighted-average common shares outstanding: | ||||||||||||||||||||||||||
Basic (b) | ||||||||||||||||||||||||||
Effect of dilutive shares: | ||||||||||||||||||||||||||
Options to purchase common stock | ||||||||||||||||||||||||||
Unvested restricted stock units | ||||||||||||||||||||||||||
Warrants | ||||||||||||||||||||||||||
Diluted (c) | ||||||||||||||||||||||||||
Net income (loss) per share attributable to Envestnet, Inc common stock: | ||||||||||||||||||||||||||
Basic (a/b) | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||
Diluted (a/c) | $ | ( | $ | $ | ( | $ |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Options to purchase common stock | ||||||||||||||||||||||||||
Unvested RSUs and PSUs | ||||||||||||||||||||||||||
Warrants | ||||||||||||||||||||||||||
Convertible Notes | ||||||||||||||||||||||||||
Total anti-dilutive securities |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Envestnet Wealth Solutions | $ | $ | $ | $ | ||||||||||||||||||||||
Envestnet Data & Analytics | ( | |||||||||||||||||||||||||
Nonsegment operating expenses | ( | ( | ( | ( | ||||||||||||||||||||||
Income (loss) from operations | ( | ( | ||||||||||||||||||||||||
Other expense, net | ( | ( | ( | ( | ||||||||||||||||||||||
Consolidated income (loss) before income tax benefit | ( | ( | ||||||||||||||||||||||||
Income tax provision (benefit) | ( | ( | ||||||||||||||||||||||||
Consolidated net income (loss) | ( | ( | ||||||||||||||||||||||||
Add: Net loss attributable to non-controlling interest | ||||||||||||||||||||||||||
Consolidated net income (loss) attributable to Envestnet, Inc. | $ | ( | $ | $ | ( | $ |
September 30, | December 31, | |||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Envestnet Wealth Solutions | $ | $ | ||||||||||||
Envestnet Data & Analytics | ||||||||||||||
Consolidated total assets | $ | $ |
September 30, | December 31, | |||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
United States | $ | $ | ||||||||||||
India | ||||||||||||||
Other | ||||||||||||||
Total long-lived assets, net | $ | $ |
As of | ||||||||||||||||||||||||||||||||
September 30, | December 31, | March 31, | June 30, | September 30, | ||||||||||||||||||||||||||||
2021 | 2021 | 2022(1) | 2022 | 2022 | ||||||||||||||||||||||||||||
(in millions, except accounts and advisors data) | ||||||||||||||||||||||||||||||||
Platform Assets | ||||||||||||||||||||||||||||||||
Assets under Management (“AUM”) | $ | 327,279 | $ | 362,038 | $ | 361,251 | $ | 325,209 | $ | 315,883 | ||||||||||||||||||||||
Assets under Administration (“AUA”) | 431,040 | 456,316 | 432,141 | 352,840 | 350,576 | |||||||||||||||||||||||||||
Total AUM/A | 758,319 | 818,354 | 793,392 | 678,049 | 666,459 | |||||||||||||||||||||||||||
Subscription | 4,670,827 | 4,901,662 | 4,736,537 | 4,312,114 | 4,134,414 | |||||||||||||||||||||||||||
Total Platform Assets | $ | 5,429,146 | $ | 5,720,016 | $ | 5,529,929 | $ | 4,990,163 | $ | 4,800,873 | ||||||||||||||||||||||
Platform Accounts | ||||||||||||||||||||||||||||||||
AUM | 1,276,066 | 1,345,274 | 1,459,093 | 1,491,861 | 1,522,968 | |||||||||||||||||||||||||||
AUA | 1,193,069 | 1,217,076 | 1,186,180 | 1,061,484 | 1,135,302 | |||||||||||||||||||||||||||
Total AUM/A | 2,469,135 | 2,562,350 | 2,645,273 | 2,553,345 | 2,658,270 | |||||||||||||||||||||||||||
Subscription | 14,810,664 | 14,986,531 | 15,151,569 | 15,312,144 | 15,596,403 | |||||||||||||||||||||||||||
Total Platform Accounts | 17,279,799 | 17,548,881 | 17,796,842 | 17,865,489 | 18,254,673 | |||||||||||||||||||||||||||
Advisors | ||||||||||||||||||||||||||||||||
AUM/A | 41,696 | 39,735 | 39,800 | 38,394 | 38,417 | |||||||||||||||||||||||||||
Subscription | 66,489 | 68,808 | 67,168 | 66,838 | 67,348 | |||||||||||||||||||||||||||
Total Advisors | 108,185 | 108,543 | 106,968 | 105,232 | 105,765 |
Asset Rollforward - Three Months Ended September 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||
As of | Gross | Net | Market | Reclass to | As of | |||||||||||||||||||||||||||||||||||||||
6/30/2022 | Sales | Redemptions | Flows | Impact | Subscription | 9/30/2022 | ||||||||||||||||||||||||||||||||||||||
(in millions, except account data) | ||||||||||||||||||||||||||||||||||||||||||||
AUM | $ | 325,209 | $ | 24,912 | $ | (15,971) | $ | 8,941 | $ | (17,762) | $ | (505) | $ | 315,883 | ||||||||||||||||||||||||||||||
AUA | 352,840 | 37,880 | (19,986) | 17,894 | (17,544) | (2,614) | 350,576 | |||||||||||||||||||||||||||||||||||||
Total AUM/A | $ | 678,049 | $ | 62,792 | $ | (35,957) | $ | 26,835 | $ | (35,306) | $ | (3,119) | $ | 666,459 | ||||||||||||||||||||||||||||||
Fee-Based Accounts | 2,553,345 | 114,147 | (9,222) | 2,658,270 |
Asset Rollforward - Nine Months Ended September 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||
As of | Gross | Net | Market | Reclass to | As of | |||||||||||||||||||||||||||||||||||||||||||||
12/31/2021 | Sales | Redemptions | Flows | Impact | Subscription | Reclassification(1) | 9/30/2022 | |||||||||||||||||||||||||||||||||||||||||||
(in millions, except account data) | ||||||||||||||||||||||||||||||||||||||||||||||||||
AUM | $ | 362,038 | $ | 78,440 | $ | (50,900) | $ | 27,540 | $ | (81,911) | $ | (505) | $ | 8,721 | $ | 315,883 | ||||||||||||||||||||||||||||||||||
AUA | 456,316 | 93,544 | (67,560) | 25,984 | (91,926) | (31,077) | (8,721) | 350,576 | ||||||||||||||||||||||||||||||||||||||||||
Total AUM/A | $ | 818,354 | $ | 171,984 | $ | (118,460) | $ | 53,524 | $ | (173,837) | $ | (31,582) | $ | — | $ | 666,459 | ||||||||||||||||||||||||||||||||||
Fee-Based Accounts | 2,562,350 | 216,564 | (120,644) | — | 2,658,270 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
September 30, | Percent | September 30, | Percent | |||||||||||||||||||||||||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | |||||||||||||||||||||||||||||||||
(in thousands) | (in thousands) | |||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Asset-based | $ | 177,131 | $ | 184,008 | (4) | % | $ | 571,820 | $ | 513,458 | 11 | % | ||||||||||||||||||||||||||
Subscription-based | 123,747 | 113,572 | 9 | % | 356,601 | 335,905 | 6 | % | ||||||||||||||||||||||||||||||
Total recurring revenues | 300,878 | 297,580 | 1 | % | 928,421 | 849,363 | 9 | % | ||||||||||||||||||||||||||||||
Professional services and other revenues | 5,817 | 5,473 | 6 | % | 18,489 | 17,533 | 5 | % | ||||||||||||||||||||||||||||||
Total revenues | 306,695 | 303,053 | 1 | % | 946,910 | 866,896 | 9 | % | ||||||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||
Cost of revenues | 110,108 | 109,836 | — | % | 361,872 | 303,199 | 19 | % | ||||||||||||||||||||||||||||||
Compensation and benefits | 116,837 | 109,839 | 6 | % | 369,453 | 316,101 | 17 | % | ||||||||||||||||||||||||||||||
General and administration | 47,388 | 39,393 | 20 | % | 157,867 | 117,463 | 34 | % | ||||||||||||||||||||||||||||||
Depreciation and amortization | 33,408 | 29,850 | 12 | % | 97,208 | 88,252 | 10 | % | ||||||||||||||||||||||||||||||
Total operating expenses | 307,741 | 288,918 | 7 | % | 986,400 | 825,015 | 20 | % | ||||||||||||||||||||||||||||||
Income (loss) from operations | (1,046) | 14,135 | (107) | % | (39,490) | 41,881 | * | |||||||||||||||||||||||||||||||
Other expense, net | (5,346) | (3,551) | 51 | % | (9,691) | (14,803) | (35) | % | ||||||||||||||||||||||||||||||
Income (loss) before income tax provision (benefit) | (6,392) | 10,584 | * | (49,181) | 27,078 | * | ||||||||||||||||||||||||||||||||
Income tax provision (benefit) | 2,271 | (854) | * | (1,542) | 9,074 | (117) | % | |||||||||||||||||||||||||||||||
Net income (loss) | (8,663) | 11,438 | * | (47,639) | 18,004 | * | ||||||||||||||||||||||||||||||||
Add: Net loss attributable to non-controlling interest | 1,373 | 302 | * | 3,205 | 401 | * | ||||||||||||||||||||||||||||||||
Net income (loss) attributable to Envestnet, Inc. | $ | (7,290) | $ | 11,740 | * | $ | (44,434) | $ | 18,405 | * |
Three Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
(in thousands, except effective tax rate) | ||||||||||||||
Income (loss) before income tax provision (benefit) | $ | (6,392) | $ | 10,584 | ||||||||||
Income tax provision (benefit) | 2,271 | (854) | ||||||||||||
Effective tax rate | (35.5) | % | (8.1) | % |
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
(in thousands, except effective tax rate) | ||||||||||||||
Income (loss) before income tax provision (benefit) | $ | (49,181) | $ | 27,078 | ||||||||||
Income tax provision (benefit) | (1,542) | 9,074 | ||||||||||||
Effective tax rate | 3.1 | % | 33.5 | % |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Envestnet Wealth Solutions | $ | 20,607 | $ | 34,386 | $ | 49,844 | $ | 101,042 | ||||||||||||||||||
Envestnet Data & Analytics | 74 | 1,265 | (9,218) | 3,896 | ||||||||||||||||||||||
Nonsegment operating expenses | (21,727) | (21,516) | (80,116) | (63,057) | ||||||||||||||||||||||
Income (loss) from operations | (1,046) | 14,135 | (39,490) | 41,881 | ||||||||||||||||||||||
Other expense, net | (5,346) | (3,551) | (9,691) | (14,803) | ||||||||||||||||||||||
Consolidated income (loss) before income tax benefit | (6,392) | 10,584 | (49,181) | 27,078 | ||||||||||||||||||||||
Income tax provision (benefit) | 2,271 | (854) | (1,542) | 9,074 | ||||||||||||||||||||||
Consolidated net income (loss) | (8,663) | 11,438 | (47,639) | 18,004 | ||||||||||||||||||||||
Add: Net loss attributable to non-controlling interest | 1,373 | 302 | 3,205 | 401 | ||||||||||||||||||||||
Consolidated net income (loss) attributable to Envestnet, Inc. | $ | (7,290) | $ | 11,740 | $ | (44,434) | $ | 18,405 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
September 30, | Percent | September 30, | Percent | |||||||||||||||||||||||||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | |||||||||||||||||||||||||||||||||
(in thousands) | (in thousands) | |||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Asset-based | $ | 177,131 | $ | 184,008 | (4) | % | $ | 571,820 | $ | 513,458 | 11 | % | ||||||||||||||||||||||||||
Subscription-based | 75,975 | 66,988 | 13 | % | 218,080 | 197,663 | 10 | % | ||||||||||||||||||||||||||||||
Total recurring revenues | 253,106 | 250,996 | 1 | % | 789,900 | 711,121 | 11 | % | ||||||||||||||||||||||||||||||
Professional services and other revenues | 4,229 | 3,738 | 13 | % | 13,003 | 10,320 | 26 | % | ||||||||||||||||||||||||||||||
Total revenues | 257,335 | 254,734 | 1 | % | 802,903 | 721,441 | 11 | % | ||||||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||
Cost of revenues | 103,618 | 103,742 | — | % | 343,148 | 285,887 | 20 | % | ||||||||||||||||||||||||||||||
Compensation and benefits | 77,010 | 67,592 | 14 | % | 234,413 | 195,560 | 20 | % | ||||||||||||||||||||||||||||||
General and administration | 31,463 | 26,086 | 21 | % | 103,824 | 71,669 | 45 | % | ||||||||||||||||||||||||||||||
Depreciation and amortization | 24,637 | 22,928 | 7 | % | 71,674 | 67,283 | 7 | % | ||||||||||||||||||||||||||||||
Total operating expenses | 236,728 | 220,348 | 7 | % | 753,059 | 620,399 | 21 | % | ||||||||||||||||||||||||||||||
Income from operations | $ | 20,607 | $ | 34,386 | (40) | % | $ | 49,844 | $ | 101,042 | (51) | % |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
September 30, | Percent | September 30, | Percent | |||||||||||||||||||||||||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | |||||||||||||||||||||||||||||||||
(in thousands) | (in thousands) | |||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
Subscription-based | $ | 47,772 | $ | 46,584 | 3 | % | $ | 138,521 | $ | 138,242 | — | % | ||||||||||||||||||||||||||
Professional services and other revenues | 1,588 | 1,735 | (8) | % | 5,486 | 7,213 | (24) | % | ||||||||||||||||||||||||||||||
Total revenues | 49,360 | 48,319 | 2 | % | 144,007 | 145,455 | (1) | % | ||||||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||
Cost of revenues | 6,490 | 6,094 | 6 | % | 18,724 | 17,312 | 8 | % | ||||||||||||||||||||||||||||||
Compensation and benefits | 26,174 | 26,468 | (1) | % | 80,334 | 77,765 | 3 | % | ||||||||||||||||||||||||||||||
General and administration | 7,851 | 7,570 | 4 | % | 28,633 | 25,513 | 12 | % | ||||||||||||||||||||||||||||||
Depreciation and amortization | 8,771 | 6,922 | 27 | % | 25,534 | 20,969 | 22 | % | ||||||||||||||||||||||||||||||
Total operating expenses | 49,286 | 47,054 | 5 | % | 153,225 | 141,559 | 8 | % | ||||||||||||||||||||||||||||||
Income (loss) from operations | $ | 74 | $ | 1,265 | * | $ | (9,218) | $ | 3,896 | * |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
September 30, | Percent | September 30, | Percent | |||||||||||||||||||||||||||||||||||
2022 | 2021 | Change | 2022 | 2021 | Change | |||||||||||||||||||||||||||||||||
(in thousands) | (in thousands) | |||||||||||||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||
Compensation and benefits | $ | 13,653 | $ | 15,779 | (13) | % | $ | 54,706 | $ | 42,776 | 28 | % | ||||||||||||||||||||||||||
General and administration | 8,074 | 5,737 | 41 | % | 25,410 | 20,281 | 25 | % | ||||||||||||||||||||||||||||||
Nonsegment operating expenses | $ | 21,727 | $ | 21,516 | 1 | % | $ | 80,116 | $ | 63,057 | 27 | % |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Total revenues | $ | 306,695 | $ | 303,053 | $ | 946,910 | $ | 866,896 | ||||||||||||||||||
Deferred revenue fair value adjustment | 54 | 67 | 162 | 227 | ||||||||||||||||||||||
Adjusted revenues | $ | 306,749 | $ | 303,120 | $ | 947,072 | $ | 867,123 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Net income (loss) | $ | (8,663) | $ | 11,438 | $ | (47,639) | $ | 18,004 | ||||||||||||||||||
Add (deduct): | ||||||||||||||||||||||||||
Deferred revenue fair value adjustment | 54 | 67 | 162 | 227 | ||||||||||||||||||||||
Interest income | (1,239) | (202) | (2,273) | (569) | ||||||||||||||||||||||
Interest expense | 4,242 | 4,242 | 13,307 | 12,682 | ||||||||||||||||||||||
Income tax provision (benefit) | 2,271 | (854) | (1,542) | 9,074 | ||||||||||||||||||||||
Depreciation and amortization | 33,408 | 29,850 | 97,208 | 88,252 | ||||||||||||||||||||||
Non-cash compensation expense | 17,265 | 18,885 | 62,583 | 50,307 | ||||||||||||||||||||||
Restructuring charges and transaction costs | 3,895 | 3,403 | 27,267 | 11,215 | ||||||||||||||||||||||
Severance | 1,125 | 207 | 11,379 | 10,498 | ||||||||||||||||||||||
Accretion on contingent consideration and purchase liability | — | 81 | — | 656 | ||||||||||||||||||||||
Fair market value adjustment on contingent consideration liability | — | (927) | — | (1,067) | ||||||||||||||||||||||
Fair market value adjustment to investment in private company | — | — | — | (758) | ||||||||||||||||||||||
Litigation and regulatory related expenses | (2,050) | 1,512 | 5,333 | 5,159 | ||||||||||||||||||||||
Foreign currency | 308 | 97 | 613 | 110 | ||||||||||||||||||||||
Gain on settlement of liability | — | (1,206) | — | (1,206) | ||||||||||||||||||||||
Gain on insurance reimbursement | — | (968) | — | (968) | ||||||||||||||||||||||
Non-income tax expense adjustment | (325) | (831) | (112) | (1,102) | ||||||||||||||||||||||
Dilution gain on equity method investee share issuance | — | — | (6,934) | — | ||||||||||||||||||||||
Loss allocations from equity method investments | 2,387 | 1,508 | 5,332 | 5,553 | ||||||||||||||||||||||
(Income) loss attributable to non-controlling interest | 820 | (114) | 1,637 | (554) | ||||||||||||||||||||||
Adjusted EBITDA | $ | 53,498 | $ | 66,188 | $ | 166,321 | $ | 205,513 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
(in thousands, except share and per share information) | ||||||||||||||||||||||||||
Net income (loss) | $ | (8,663) | $ | 11,438 | $ | (47,639) | $ | 18,004 | ||||||||||||||||||
Income tax provision (benefit) (1) | 2,271 | (854) | (1,542) | 9,074 | ||||||||||||||||||||||
Income (loss) before income tax provision (benefit) | (6,392) | 10,584 | (49,181) | 27,078 | ||||||||||||||||||||||
Add (deduct): | ||||||||||||||||||||||||||
Deferred revenue fair value adjustment | 54 | 67 | 162 | 227 | ||||||||||||||||||||||
Non-cash interest expense | 1,443 | 1,443 | 4,917 | 4,295 | ||||||||||||||||||||||
Cash interest - Convertible Notes | 2,479 | 2,479 | 7,439 | 7,439 | ||||||||||||||||||||||
Non-cash compensation expense | 17,265 | 18,885 | 62,583 | 50,307 | ||||||||||||||||||||||
Restructuring charges and transaction costs | 3,895 | 3,403 | 27,267 | 11,215 | ||||||||||||||||||||||
Severance | 1,125 | 207 | 11,379 | 10,498 | ||||||||||||||||||||||
Accretion on contingent consideration and purchase liability | — | 81 | — | 656 | ||||||||||||||||||||||
Fair market value adjustment on contingent consideration liability | — | (927) | — | (1,067) | ||||||||||||||||||||||
Fair market value adjustment to investment in private company | — | — | — | (758) | ||||||||||||||||||||||
Amortization of acquired intangibles | 18,649 | 17,390 | 53,814 | 51,370 | ||||||||||||||||||||||
Litigation and regulatory related expenses | (2,050) | 1,512 | 5,333 | 5,159 | ||||||||||||||||||||||
Foreign currency | 308 | 97 | 613 | 110 | ||||||||||||||||||||||
Gain on settlement of liability | — | (1,206) | — | (1,206) | ||||||||||||||||||||||
Gain on insurance reimbursement | — | (968) | — | (968) | ||||||||||||||||||||||
Non-income tax expense adjustment | (325) | (831) | (112) | (1,102) | ||||||||||||||||||||||
Dilution gain on equity method investee share issuance | — | — | (6,934) | — | ||||||||||||||||||||||
Loss allocations from equity method investments | 2,387 | 1,508 | 5,332 | 5,553 | ||||||||||||||||||||||
(Income) loss attributable to non-controlling interest | 820 | (114) | 1,637 | (554) | ||||||||||||||||||||||
Adjusted net income before income tax effect | 39,658 | 53,610 | 124,249 | 168,252 | ||||||||||||||||||||||
Income tax effect (2) | (10,112) | (13,670) | (31,683) | (42,904) | ||||||||||||||||||||||
Adjusted net income | $ | 29,546 | $ | 39,940 | $ | 92,566 | $ | 125,348 | ||||||||||||||||||
Basic number of weighted-average shares outstanding | 55,226,777 | 54,547,858 | 55,109,387 | 54,400,247 | ||||||||||||||||||||||
Effect of dilutive shares: | ||||||||||||||||||||||||||
Options to purchase common stock | 74,559 | 201,103 | 123,267 | 207,281 | ||||||||||||||||||||||
Unvested restricted stock units | 208,367 | 570,515 | 378,061 | 614,005 | ||||||||||||||||||||||
Convertible notes | 9,898,549 | 9,898,549 | 9,898,549 | 9,898,549 | ||||||||||||||||||||||
Warrants | — | 69,151 | — | 66,439 | ||||||||||||||||||||||
Diluted number of weighted-average shares outstanding | 65,408,252 | 65,287,176 | 65,509,264 | 65,186,521 | ||||||||||||||||||||||
Adjusted net income per share - diluted | $ | 0.45 | $ | 0.61 | $ | 1.41 | $ | 1.92 | ||||||||||||||||||
Three Months Ended September 30, 2022 | ||||||||||||||||||||||||||
Envestnet Wealth Solutions | Envestnet Data & Analytics | Nonsegment | Total | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Revenues | $ | 257,335 | $ | 49,360 | $ | — | $ | 306,695 | ||||||||||||||||||
Deferred revenue fair value adjustment | 54 | — | — | 54 | ||||||||||||||||||||||
Adjusted revenues | $ | 257,389 | $ | 49,360 | $ | — | $ | 306,749 | ||||||||||||||||||
Income (loss) from operations | $ | 20,607 | $ | 74 | $ | (21,727) | $ | (1,046) | ||||||||||||||||||
Add: | ||||||||||||||||||||||||||
Deferred revenue fair value adjustment | 54 | — | — | 54 | ||||||||||||||||||||||
Depreciation and amortization | 24,637 | 8,771 | — | 33,408 | ||||||||||||||||||||||
Non-cash compensation expense | 11,235 | 2,991 | 3,039 | 17,265 | ||||||||||||||||||||||
Restructuring charges and transaction costs | 928 | 1,264 | 1,703 | 3,895 | ||||||||||||||||||||||
Severance | 686 | 281 | 158 | 1,125 | ||||||||||||||||||||||
Litigation and regulatory related expenses | — | (2,050) | — | (2,050) | ||||||||||||||||||||||
Non-income tax expense adjustment | (343) | 18 | — | (325) | ||||||||||||||||||||||
Loss attributable to non-controlling interest | 820 | — | — | 820 | ||||||||||||||||||||||
Other | 352 | — | — | 352 | ||||||||||||||||||||||
Adjusted EBITDA | $ | 58,976 | $ | 11,349 | $ | (16,827) | $ | 53,498 |
Three Months Ended September 30, 2021 | ||||||||||||||||||||||||||
Envestnet Wealth Solutions | Envestnet Data & Analytics | Nonsegment | Total | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Revenues | $ | 254,734 | $ | 48,319 | $ | — | $ | 303,053 | ||||||||||||||||||
Deferred revenue fair value adjustment | 67 | — | — | 67 | ||||||||||||||||||||||
Adjusted revenues | $ | 254,801 | $ | 48,319 | $ | — | $ | 303,120 | ||||||||||||||||||
Income (loss) from operations | $ | 34,386 | $ | 1,265 | $ | (21,516) | $ | 14,135 | ||||||||||||||||||
Add (deduct): | ||||||||||||||||||||||||||
Deferred revenue fair value adjustment | 67 | — | — | 67 | ||||||||||||||||||||||
Depreciation and amortization | 22,928 | 6,922 | — | 29,850 | ||||||||||||||||||||||
Non-cash compensation expense | 9,661 | 3,667 | 5,557 | 18,885 | ||||||||||||||||||||||
Restructuring charges and transaction costs | 2,863 | (55) | 595 | 3,403 | ||||||||||||||||||||||
Severance | (49) | 227 | 29 | 207 | ||||||||||||||||||||||
Accretion on contingent consideration and purchase liability | 62 | 19 | — | 81 | ||||||||||||||||||||||
Fair market value adjustment on contingent consideration liability | — | (927) | — | (927) | ||||||||||||||||||||||
Litigation and regulatory related expenses | — | 1,512 | — | 1,512 | ||||||||||||||||||||||
Non-income tax expense adjustment | (905) | 74 | — | (831) | ||||||||||||||||||||||
Income attributable to non-controlling interest | (114) | — | — | (114) | ||||||||||||||||||||||
Other | (63) | (9) | (8) | (80) | ||||||||||||||||||||||
Adjusted EBITDA | $ | 68,836 | $ | 12,695 | $ | (15,343) | $ | 66,188 |
Nine Months Ended September 30, 2022 | ||||||||||||||||||||||||||
Envestnet Wealth Solutions | Envestnet Data & Analytics | Nonsegment | Total | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Revenues | $ | 802,903 | $ | 144,007 | $ | — | $ | 946,910 | ||||||||||||||||||
Deferred revenue fair value adjustment | 162 | — | — | 162 | ||||||||||||||||||||||
Adjusted revenues | $ | 803,065 | $ | 144,007 | $ | — | $ | 947,072 | ||||||||||||||||||
Income (loss) from operations | $ | 49,844 | $ | (9,218) | $ | (80,116) | $ | (39,490) | ||||||||||||||||||
Add (deduct): | ||||||||||||||||||||||||||
Deferred revenue fair value adjustment | 162 | — | — | 162 | ||||||||||||||||||||||
Depreciation and amortization | 71,674 | 25,534 | — | 97,208 | ||||||||||||||||||||||
Non-cash compensation expense | 35,889 | 8,378 | 18,316 | 62,583 | ||||||||||||||||||||||
Restructuring charges and transaction costs | 18,109 | 2,014 | 7,144 | 27,267 | ||||||||||||||||||||||
Severance | 4,909 | 1,492 | 4,978 | 11,379 | ||||||||||||||||||||||
Litigation and regulatory related expenses | — | 5,333 | — | 5,333 | ||||||||||||||||||||||
Non-income tax expense adjustment | (52) | (60) | — | (112) | ||||||||||||||||||||||
Loss attributable to non-controlling interest | 1,637 | — | — | 1,637 | ||||||||||||||||||||||
Other | 352 | 2 | — | 354 | ||||||||||||||||||||||
Adjusted EBITDA | $ | 182,524 | $ | 33,475 | $ | (49,678) | $ | 166,321 |
Nine Months Ended September 30, 2021 | ||||||||||||||||||||||||||
Envestnet Wealth Solutions | Envestnet Data & Analytics | Nonsegment | Total | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Revenues | $ | 721,441 | $ | 145,455 | $ | — | $ | 866,896 | ||||||||||||||||||
Deferred revenue fair value adjustment | 227 | — | — | 227 | ||||||||||||||||||||||
Adjusted revenues | $ | 721,668 | $ | 145,455 | $ | — | $ | 867,123 | ||||||||||||||||||
Income (loss) from operations | $ | 101,042 | $ | 3,896 | $ | (63,057) | $ | 41,881 | ||||||||||||||||||
Add (deduct): | ||||||||||||||||||||||||||
Deferred revenue fair value adjustment | 227 | — | — | 227 | ||||||||||||||||||||||
Depreciation and amortization | 67,283 | 20,969 | — | 88,252 | ||||||||||||||||||||||
Non-cash compensation expense | 27,080 | 9,691 | 13,536 | 50,307 | ||||||||||||||||||||||
Restructuring charges and transaction costs | 8,049 | 119 | 3,047 | 11,215 | ||||||||||||||||||||||
Severance | 4,134 | 3,634 | 2,730 | 10,498 | ||||||||||||||||||||||
Accretion on contingent consideration and purchase liability | 572 | 84 | — | 656 | ||||||||||||||||||||||
Fair market value adjustment on contingent consideration liability | — | (1,067) | — | (1,067) | ||||||||||||||||||||||
Litigation and regulatory related expenses | — | 5,159 | — | 5,159 | ||||||||||||||||||||||
Non-income tax expense adjustment | (1,335) | 233 | — | (1,102) | ||||||||||||||||||||||
Income attributable to non-controlling interest | (554) | — | — | (554) | ||||||||||||||||||||||
Other | 41 | — | — | 41 | ||||||||||||||||||||||
Adjusted EBITDA | $ | 206,539 | $ | 42,718 | $ | (43,744) | $ | 205,513 |
Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||
2022 | 2021 | |||||||||||||
(in thousands) | ||||||||||||||
Net cash provided by operating activities | $ | 86,235 | $ | 169,974 | ||||||||||
Net cash used in investing activities | (226,755) | (135,040) | ||||||||||||
Net cash used in financing activities | (44,450) | (25,156) | ||||||||||||
Effect of exchange rate on changes on cash | (3,128) | (544) | ||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (188,098) | 9,234 | ||||||||||||
Cash, cash equivalents and restricted cash, end of period | 241,330 | 393,948 |
Exhibit No. | Description | |||||||
31.1 | ||||||||
31.2 | ||||||||
32.1 | ||||||||
32.2 | ||||||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document * | |||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document * | |||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document * | |||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document * | |||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document * | |||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
ENVESTNET, INC. | ||||||||
By: | /s/ William C. Crager | |||||||
William C. Crager | ||||||||
Chief Executive Officer | ||||||||
Principal Executive Officer | ||||||||
By: | /s/ Peter H. D’Arrigo | |||||||
Peter H. D’Arrigo | ||||||||
Chief Financial Officer | ||||||||
Principal Financial Officer | ||||||||
By: | /s/ Matthew J. Majoros | |||||||
Matthew J. Majoros | ||||||||
Senior Vice President, Financial Reporting | ||||||||
Principal Accounting Officer |
Date: November 9, 2022 | /s/ William C. Crager | ||||
William C. Crager | |||||
Chief Executive Officer | |||||
(Principal Executive Officer) |
Date: November 9, 2022 | /s/ Peter H. D’Arrigo | ||||
Peter H. D’Arrigo | |||||
Chief Financial Officer | |||||
(Principal Financial Officer) |
/s/ William C. Crager | ||
By: William C. Crager | ||
Chief Executive Officer | ||
(Principal Executive Officer) | ||
Dated: November 9, 2022 |
/s/ Peter H. D’Arrigo | ||
By: Peter H. D’Arrigo | ||
Chief Financial Officer | ||
(Principal Financial Officer) | ||
Dated: November 9, 2022 |
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Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Sep. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Preferred stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.005 | $ 0.005 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 69,866,788 | 68,879,152 |
Common stock, shares outstanding (in shares) | 55,323,222 | 54,793,088 |
Treasury stock (in shares) | 14,543,566 | 14,086,064 |
Condensed Consolidated Statements of Operations - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Revenues: | ||||
Total revenues | $ 306,695 | $ 303,053 | $ 946,910 | $ 866,896 |
Operating expenses: | ||||
Cost of revenues | 110,108 | 109,836 | 361,872 | 303,199 |
Compensation and benefits | 116,837 | 109,839 | 369,453 | 316,101 |
General and administration | 47,388 | 39,393 | 157,867 | 117,463 |
Depreciation and amortization | 33,408 | 29,850 | 97,208 | 88,252 |
Total operating expenses | 307,741 | 288,918 | 986,400 | 825,015 |
Income (loss) from operations | (1,046) | 14,135 | (39,490) | 41,881 |
Other expense, net | (5,346) | (3,551) | (9,691) | (14,803) |
Income (loss) before income tax provision (benefit) | (6,392) | 10,584 | (49,181) | 27,078 |
Income tax provision (benefit) | 2,271 | (854) | (1,542) | 9,074 |
Net income (loss) | (8,663) | 11,438 | (47,639) | 18,004 |
Add: Net loss attributable to non-controlling interest | 1,373 | 302 | 3,205 | 401 |
Net income (loss) attributable to Envestnet, Inc. | $ (7,290) | $ 11,740 | $ (44,434) | $ 18,405 |
Net income (loss) per share attributable to Envestnet, Inc.: | ||||
Basic (in dollars per share) | $ (0.13) | $ 0.22 | $ (0.81) | $ 0.34 |
Diluted (in dollars per share) | $ (0.13) | $ 0.21 | $ (0.81) | $ 0.33 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 55,226,777 | 54,547,858 | 55,109,387 | 54,400,247 |
Diluted (in shares) | 55,226,777 | 55,388,627 | 55,109,387 | 55,287,972 |
Total recurring revenues | ||||
Revenues: | ||||
Total revenues | $ 300,878 | $ 297,580 | $ 928,421 | $ 849,363 |
Asset-based | ||||
Revenues: | ||||
Total revenues | 177,131 | 184,008 | 571,820 | 513,458 |
Operating expenses: | ||||
Cost of revenues | 102,409 | 102,298 | 332,138 | 281,829 |
Subscription-based | ||||
Revenues: | ||||
Total revenues | 123,747 | 113,572 | 356,601 | 335,905 |
Operating expenses: | ||||
Cost of revenues | 7,768 | 7,355 | 22,820 | 20,986 |
Professional services and other revenues | ||||
Revenues: | ||||
Total revenues | 5,817 | 5,473 | 18,489 | 17,533 |
Operating expenses: | ||||
Cost of revenues | $ (69) | $ 183 | $ 6,914 | $ 384 |
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) attributable to Envestnet, Inc. | $ (7,290) | $ 11,740 | $ (44,434) | $ 18,405 |
Foreign currency translation gains (losses), net of taxes | (1,479) | 270 | (6,050) | (1,618) |
Comprehensive income (loss) attributable to Envestnet, Inc. | $ (8,769) | $ 12,010 | $ (50,484) | $ 16,787 |
Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2020
USD ($)
| |
Cumulative Effect, Period of Adoption, Adjustment | |
Income tax provision (benefit) | $ 7,641 |
Organization and Description of Business |
9 Months Ended |
---|---|
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Envestnet, Inc. (“Envestnet”) through its subsidiaries (collectively, the “Company”) is transforming the way financial advice and insight are delivered. Its mission is to empower financial advisors and service providers with innovative technology, solutions and intelligence. Envestnet has been a leader in helping transform wealth management, working towards its goal of expanding a holistic financial wellness ecosystem so that our clients can deliver an intelligent financial life to their clients. Envestnet is organized around two primary, complementary business segments. Financial information about each business segment is contained in “Note 15—Segment Information” to the condensed consolidated financial statements.
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Basis of Presentation |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements of the Company as of September 30, 2022 and for the three and nine months ended September 30, 2022 and 2021 have not been audited by an independent registered public accounting firm. These unaudited condensed consolidated financial statements have been prepared on the same basis as our audited consolidated financial statements for the year ended December 31, 2021 and reflect all normal recurring adjustments which are, in the opinion of management, necessary to present fairly the Company’s financial position as of September 30, 2022 and results of operations, equity, comprehensive income (loss) and cash flows for the periods presented herein. The unaudited condensed consolidated financial statements include the accounts of the Company. All significant intercompany transactions and balances have been eliminated in consolidation. Accounts for the Envestnet Wealth Solutions segment that are denominated in a non-U.S. currency have been re-measured using the U.S. dollar as the functional currency. Certain accounts within the Envestnet Data & Analytics segment are recorded and measured in foreign currencies. The assets and liabilities for those subsidiaries with a functional currency other than the U.S. dollar are translated at exchange rates in effect at the balance sheet date, and revenues and expenses are translated at average exchange rates. Differences arising from these foreign currency translations are recorded in the unaudited condensed consolidated balance sheets as accumulated other comprehensive income (loss) within stockholders' equity. The Company is also subject to gains and losses from foreign currency denominated transactions and the remeasurement of foreign currency denominated balance sheet accounts, both of which are included in other expense, net in the condensed consolidated statements of operations. The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of the results of operations to be expected for other interim periods or for the full fiscal year. The unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. References to GAAP in these notes are to the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification™, sometimes referred to as the codification or “ASC.” These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC on February 25, 2022. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Actual results could differ from these estimates. The following table reconciles amounts from the condensed consolidated balance sheets to cash, cash equivalents and restricted cash reported within the condensed consolidated statements of cash flows:
Macroeconomic Environment The Company's business is directly and indirectly affected by macroeconomic conditions and the state of global financial markets. Recent geopolitical uncertainty resulting, in part, from military conflict between Russia and Ukraine which escalated in February 2022 as well as rising inflation have contributed to significant volatility and decline in global financial markets during 2022 which continues as of the date of this quarterly report. The uncertainty over the extent and duration of the ongoing conflict and this period of inflation continues to cause disruptions to businesses and markets worldwide. The extent of the effect on the Company's financial performance will continue to depend on future developments, including the extent and duration of the conflict and this period of inflation, the Federal Reserve's monetary policy in response to rising inflation, the extent of economic sanctions imposed, changes in market interest rates, further governmental and private sector responses and the timing and extent normal economic conditions resume, all of which are uncertain and difficult to predict. Although the Company is unable to estimate the overall financial effect of the conflict and this period of inflation at this time, as these conditions continue, they could have a material adverse effect on the Company's business, results of operations, financial condition and cash flows. As of September 30, 2022, these condensed consolidated financial statements do not reflect any adjustments as a result of these macroeconomic conditions. Related Party Transactions The Company has an approximate 4.4% membership interest in a private services company that it accounts for using the equity method of accounting and is considered to be a related party. Revenues from the private services company totaled $3.7 million and $4.2 million in the three months ended September 30, 2022 and 2021, respectively. Revenues from the private services company totaled $12.7 million and $11.9 million in the nine months ended September 30, 2022 and 2021, respectively. As of September 30, 2022 and December 31, 2021, the Company recorded a net receivable of $5.0 million and $3.0 million, respectively, from the private services company. Dilution gain on equity method investee share issuance The Company has an ownership interest in a privately held company that is accounted for under the equity method. During the first quarter of 2022, the Company funded a $2.5 million convertible loan to this privately held company. During the second quarter of 2022, this privately held company raised additional preferred equity which reduced the Company's ownership to 41.0% and the Company's convertible loan was converted. As a result of this transaction, the Company recorded a $6.9 million dilution gain during the second quarter of 2022, which is included in other expense, net in the condensed consolidated statements of operations. Exercise of Membership Interests The Company granted membership interests in certain of its equity investments to two legacy PIEtech executives as part of the 2019 acquisition of PIEtech. These interests, which were fully vested as of May 1, 2020, became exercisable on May 1, 2022. In July 2022, these executives exercised their respective put options and sold these membership interests to the Company for approximately $10 million. Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements— In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805).” This update amends Topic 805 to add contract assets and contract liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure contract assets and contract liabilities in accordance with ASC 606. This standard is effective for financial statements issued by public companies for annual and interim periods beginning after December 15, 2022. Early adoption of the standard is permitted. The amendment is to be applied prospectively to business combinations occurring on or after the effective date of the amendment. The Company adopted this standard as of January 1, 2022. Adoption of this standard did not have a material impact on the Company's condensed consolidated financial statements.
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Acquisitions and Other Investments |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions and Other Investments | Acquisitions and Other Investments Investments in Privately Held Companies On May 20, 2022, the Company acquired a 25.0% interest in a privately held company for cash consideration of $5.0 million. Subject to the occurrence of certain conditions, the Company agreed to invest up to an additional $10.0 million for additional units in the future. The Company uses the equity method of accounting to record its portion of this privately held company's net income or loss on a one quarter lag from the actual results of operations. The Company uses the equity method of accounting because of its less than 50% ownership interest and lack of control and does not otherwise exercise control over the significant economic and operating decisions of the privately held company. On September 2, 2022, the Company acquired additional membership units in a privately held company in which the Company already had an approximate 43% ownership interest for $8.4 million which increased its ownership interest to 48%. The Company uses the equity method of accounting to record its portion of this privately held company's net income or loss on a one quarter lag from the actual results of operations. After this unit purchase, the Company's investment in this privately held company exceeded its proportionate share of its net assets by approximately $7.8 million, which represents amortizable intangible assets. The Company will recognize amortization of this basis difference prospectively over a period of 5 years. This amortization will be included within Envestnet's proportional share of income (loss) in other expense, net in the condensed consolidated statements of operations. Acquisition of 401kplans.com On May 31, 2022, Envestnet Retirement Solutions, LLC, a wholly-owned subsidiary of the Company, acquired all of the issued and outstanding membership interests of 401kplans.com LLC (“401kplans.com”). 401kplans.com has been integrated into the Envestnet Wealth Solutions segment. 401kplans.com provides a digital 401(k) retirement plan marketplace that streamlines retirement plan distribution and due diligence among financial advisors and third-party administrators. The acquisition demonstrates Envestnet's commitment to the retirement plan industry and is expected to create a more seamless experience and enhance productivity for advisors by helping them shop, compare and select the best-fitting 401(k) plan for their client. In connection with the 401kplans.com acquisition, the Company paid estimated consideration of $14.5 million, net of cash acquired, subject to certain post-closing adjustments. The Company funded the acquisition with available cash resources. The following table summarizes the estimated fair values of the assets acquired at the date of acquisition:
The goodwill arising from the acquisition represents the expected benefits of the transaction, primarily related to the enhancement of the Company's existing technologies and increase in future revenues as a result of potential cross selling opportunities. The estimated goodwill is deductible for income tax purposes. A summary of estimated intangible assets acquired, estimated useful lives and amortization method is as follows:
The estimated fair values of certain of the assets acquired are provisional and based on information that was available to the Company as of the acquisition date. The estimated fair values of these provisional items are based on certain valuation procedures that are in progress and not yet at the point where there is sufficient information for a definitive measurement. The Company believes the preliminary information provides a reasonable basis for estimating the fair values of these amounts, but is waiting for additional information necessary to finalize those fair values. Therefore, provisional measurements of fair values reflected herein are subject to change and such changes could be significant. The Company expects to finalize the valuation of tangible assets acquired, identifiable intangible assets and goodwill balances and complete the acquisition accounting as soon as reasonably practicable but no later than May 31, 2023. The results of 401kplans.com's operations are included in the condensed consolidated statements of operations beginning May 31, 2022 and are not considered material to the Company’s results of operations. For the three and nine months ended September 30, 2022, the Company’s acquisition related costs were not material, and are included in general and administration expenses. The Company may incur additional acquisition related costs over the remainder of 2022. Acquisition of Truelytics On July 1, 2022, pursuant to an agreement and plan of merger (the “Merger Agreement”), dated as of May 10, 2022, between, among others, Truelytics, Inc., (“Truelytics”), Yodlee, Inc. and Quadrant Merger Sub Inc., a wholly owned subsidiary of Envestnet (“Merger Sub”), the Company completed the merger of Truelytics with and into Merger Sub, with Truelytics continuing as the surviving corporation (the “Truelytics Merger”) and a wholly owned subsidiary of Envestnet. Truelytics has been integrated into the Envestnet Data & Analytics segment. The acquisition of Truelytics aligns with the Company's strategy to further connect its ecosystem by creating transformative progress for its advisors and clients. Truelytics is an Advisor Transition Management platform and the first end-to-end data-driven system to help wealth management and insurance enterprises attract, grow, and retain advisory businesses, while also reducing the costs related to advisor transitions. The Truelytics platform combines Envestnet data, analytics, and wealth technology to further support advisors across the ecosystem. The Company paid estimated cash consideration of $20.7 million, net of cash acquired, subject to certain post-closing adjustments. The Company funded the Truelytics acquisition with available cash resources. The following table summarizes the estimated fair values of the assets acquired at the date of acquisition:
The goodwill arising from the acquisition represents the expected benefits of the transaction, primarily related to the enhancement of the Company's existing technologies and increase in future revenues as a result of potential cross selling opportunities. The estimated goodwill is not deductible for income tax purposes. A summary of estimated intangible assets acquired, estimated useful lives and amortization method is as follows:
The estimated fair values of certain of the assets and liabilities acquired are provisional and based on information that was available to the Company as of the acquisition date. The estimated fair values of these provisional items are based on certain valuation procedures that are in progress and not yet at the point where there is sufficient information for a definitive measurement. The Company believes the preliminary information provides a reasonable basis for estimating the fair values of these amounts, but is waiting for additional information necessary to finalize those fair values. Therefore, provisional measurements of fair values reflected herein are subject to change and such changes could be significant. The Company expects to finalize the valuation of tangible assets acquired, liabilities assumed, identifiable intangible assets and goodwill balances and complete the acquisition accounting as soon as reasonably practicable but no later than July 1, 2023. The results of Truelytics' operations are included in the condensed consolidated statements of operations beginning July 1, 2022 and are not considered material to the Company’s results of operations. For the three and nine months ended September 30, 2022, the Company’s acquisition related costs were not material, and are included in general and administration expenses. The Company may incur additional acquisition related costs over the remainder of 2022. Acquisition of Redi2 Technologies On July 1, 2022 pursuant to a stock purchase agreement, dated as of June 24, 2022, between Envestnet, Inc. (“Envestnet”) and Redi2 Technologies Inc., (“Redi2 Technologies”), Envestnet completed the acquisition of all of the issued and outstanding shares of Redi2 Technologies (the “Redi2 Technologies Acquisition”). Redi2 Technologies provides revenue management and hosted fee-billing solutions. Its platform enables fee calculation, invoice creation, payouts and accounting, and billing compliance. Redi2 Technologies has been integrated into the Envestnet Wealth Solutions segment. In connection with the Redi2 Technologies Acquisition, the Company paid estimated consideration as follows:
The Company funded the Redi2 Technologies Acquisition with available cash resources. In addition, certain executives may earn up to $20.0 million in performance bonuses based upon the achievement of certain target financial and non-financial metrics. These performance bonuses will be recognized as compensation and benefits expense in the statement of operations. No amounts were recorded during the three months ended September 30, 2022. The following table summarizes the estimated fair values of the assets acquired at the date of acquisition:
The goodwill arising from the acquisition represents the expected benefits of the transaction, primarily related to the enhancement of the Company's existing technologies and increase in future revenues as a result of potential cross selling opportunities. Estimated goodwill of $39.5 million is deductible for income tax purposes. A summary of estimated intangible assets acquired, estimated useful lives and amortization method is as follows:
The estimated fair values of certain of the assets acquired and liabilities assumed are provisional and based on information that was available to the Company as of the acquisition date. The estimated fair values of these provisional items are based on certain valuation procedures that are in progress and not yet at the point where there is sufficient information for a definitive measurement. The Company believes the preliminary information provides a reasonable basis for estimating the fair values of these amounts, but is waiting for additional information necessary to finalize those fair values. Therefore, provisional measurements of fair values reflected herein are subject to change and such changes could be significant. The Company expects to finalize the valuation of tangible assets acquired, liabilities assumed, identifiable intangible assets and goodwill balances and complete the acquisition accounting as soon as reasonably practicable but no later than July 1, 2023. The results of Redi2 Technologies' operations are included in the condensed consolidated statements of operations beginning July 1, 2022 and are not considered material to the Company’s results of operations. For the three and nine months ended September 30, 2022, the Company’s acquisition related costs were not material, and are included in general and administration expenses. The Company may incur additional acquisition related costs over the remainder of 2022.
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Prepaid Expenses and Other Current Assets |
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Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following:
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Property and Equipment, Net |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net consisted of the following:
During the nine months ended September 30, 2022, the Company entered into an arrangement with a third party cloud service provider for the use of dedicated servers to migrate its infrastructure to the cloud. As the terms of the arrangement convey a finance lease under FASB Topic 842 - Leases (“ASC 842”), the Company accounts for those dedicated servers as leased assets when the lease term commences. The Company accounts for each lease and any non-lease components associated with that lease as a single lease component for all asset classes. The leased dedicated servers are presented as a component of property and equipment, net in the condensed consolidated balance sheets as of September 30, 2022. To take advantage of the favorable savings programs offered by the cloud service provider, the Company prepaid the lease payments and therefore does not have a lease liability recorded for the leased assets. Gross property and equipment under finance leases as of September 30, 2022 was $15.9 million with accumulated depreciation of $3.6 million. Finance lease activity as of and for the year ended December 31, 2021 was not material. Office Closures In April 2022, in response to changing needs and an increase in employees working remotely, the Company closed three offices in the United States. The Company is currently exploring alternative uses for these properties, including sublease options. During the three and nine months ended September 30, 2022, including the office closures, the Company retired property and equipment that was no longer in service for the Envestnet Wealth Solutions segment with an historical cost of $0.1 million and $16.6 million, respectively. Including the office closures, in the three and nine months ended September 30, 2022, gains and losses on asset retirements were zero and $3.7 million, respectively, for the Envestnet Wealth Solutions segment. In the three and nine months ended September 30, 2022, the Company also recognized $1.1 million and $14.1 million, respectively, of lease restructuring costs which are included in general and administration expense in the condensed consolidated statements of operations. During the three and nine months ended September 30, 2022, the Company retired property and equipment that was no longer in service for the Envestnet Data & Analytics segment with an historical cost of $1.7 million and $2.9 million, respectively. Gains and losses on asset retirements during the three and nine months ended September 30, 2022 were not material for the Envestnet Data & Analytics segment. During the three and nine months ended September 30, 2021, the Company retired property and equipment that was no longer in service for the Envestnet Wealth Solutions segment with an historical cost of $1.8 million and $9.6 million, respectively. During the three and nine months ended September 30, 2021, the Company retired property and equipment that was no longer in service for the Envestnet Data & Analytics segment with an historical cost of $0.4 million and $1.0 million, respectively. Gains and losses on asset retirements during the three and nine months ended September 30, 2021 were not material. Depreciation and amortization expense was as follows:
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Internally Developed Software |
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Internally Developed Software | Internally Developed Software Internally developed software, net consisted of the following:
Amortization expense was as follows:
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Goodwill and Intangible Assets, Net |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net Changes in the carrying amount of goodwill were as follows:
Procurement of Technology Solutions On June 21, 2021, the Company entered into a purchase agreement with a privately held company to acquire the technology solutions being developed by this privately held company for a purchase price of $18.0 million, including an advance of $3.0 million. The Company closed the transaction and paid the remaining $15.0 million in February 2022. This proprietary technology asset has been integrated into the Envestnet Data & Analytics segment and is being amortized over an estimated useful life of five years. In addition, the agreement includes an earn-out payment of $10.0 million based upon the achievement of certain target metrics within five years after the date of the Company’s launch of the technology solutions. The parties have agreed to renegotiate the terms of the earn-out payment. Intangible assets, net consisted of the following:
There were no material retirements of intangible assets during the three and nine months ended September 30, 2022 and 2021. Amortization expense was as follows:
Future amortization expense of the Company's intangible assets as of September 30, 2022, is expected to be as follows:
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Accrued Expenses and Other Liabilities |
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Expenses and Other Liabilities | Accrued Expenses and Other Liabilities Accrued expenses and other liabilities consisted of the following:
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Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt The Company’s outstanding debt obligations as of September 30, 2022 and December 31, 2021 were as follows:
Third Credit Agreement On February 4, 2022, the Company entered into a Third Amended and Restated Credit Agreement (the “Third Credit Agreement”) with a group of banks (the “Banks”), for which Bank of Montreal is acting as administrative agent. The Third Credit Agreement amends and restates, in its entirety, the Company's prior credit agreement. In connection with entering into the Third Credit Agreement, the Company capitalized an additional $1.9 million of deferred financing charges to Other non-current assets on the condensed consolidated balance sheets and wrote off $0.6 million of pre-existing finance charges to other expense, net on the condensed consolidated statements of operations. Pursuant to the Third Credit Agreement, the Banks have agreed to provide the Company with a revolving credit facility of $500.0 million (the “Revolving Credit Facility”). The Third Credit Agreement also includes a $20.0 million sub-facility for the issuances of letters of credit. As of September 30, 2022 and December 31, 2021, there were no amounts outstanding under the Revolving Credit Facility. Obligations under the Third Credit Agreement are guaranteed by substantially all of Envestnet’s U.S. subsidiaries and are secured by a first-priority lien on substantially all of the personal property (other than intellectual property) of Envestnet and the guarantors, subject to certain exclusions. Proceeds under the Third Credit Agreement may be used to finance capital expenditures and permitted acquisitions and for working capital and general corporate purposes. In the event the Company has borrowings under the Third Credit Agreement, at the Company's option, it will pay interest on these borrowings at a rate equal to either (i) a base rate plus an applicable margin ranging from 0.25% to 1.75% per annum or (ii) an adjusted Term Secured Overnight Financing Rate (“SOFR”) plus an applicable margin ranging from 1.25% to 2.75% per annum, in each case based upon the total net leverage ratio, as calculated pursuant to the Credit Agreement. Any borrowings under the Third Credit Agreement will mature on February 4, 2027. There is also a commitment fee at a rate ranging from 0.25% to 0.30% per annum based upon the total net leverage ratio. As of September 30, 2022, debt issuance costs related to the Third Credit Agreement are presented in prepaid expenses and other non-current assets in the condensed consolidated balance sheets which have outstanding amounts of $0.7 million and $2.3 million, respectively. The Third Credit Agreement contains customary conditions, representations and warranties, affirmative and negative covenants, mandatory prepayment provisions and events of default. The covenants include certain financial covenants requiring the Company to maintain compliance with a maximum total leverage ratio, a minimum interest coverage ratio and a minimum liquidity covenant. The Company was in compliance with these financial covenants as of September 30, 2022. As of September 30, 2022, the Company had all $500.0 million available to borrow under the Revolving Credit Facility, subject to covenant compliance. Convertible Notes due 2023 In May 2018, the Company issued $345.0 million of Convertible Notes due 2023 that mature on June 1, 2023. The Convertible Notes due 2023 bear interest at a rate of 1.75% per annum payable semiannually in arrears on June 1 and December 1 of each year. The Convertible Notes due 2023 are general unsecured obligations, subordinated in right of payment to the Company's obligations under its Credit Agreement. The effective interest rate of the Convertible Notes due 2023 was approximately 2.4% for the three and nine months ended September 30, 2022 and 2021. The effective interest rate of the Convertible Notes due 2023 is equal to the stated interest rate plus the amortization of the debt issuance costs. Convertible Notes due 2025 In August 2020, the Company issued $517.5 million of Convertible Notes due 2025 that mature on August 15, 2025. The Convertible Notes due 2025 bear interest at a rate of 0.75% per annum payable semiannually in arrears on February 15 and August 15 of each year. The Convertible Notes due 2025 are general unsecured obligations, subordinated in right of payment to the Company's obligations under its Credit Agreement. The effective interest rate of the Convertible Notes due 2025 was approximately 1.3% for the three and nine months ended September 30, 2022 and 2021. The effective interest rate of the Convertible Notes due 2025 was equal to the stated interest rate plus the amortization of the debt issuance costs. Interest Expense Interest expense was comprised of the following and is included in other expense, net in the condensed consolidated statements of operations:
For each of the three months ended September 30, 2022 and 2021, total interest expense related to the Convertible Notes due 2023 and the Convertible Notes due 2025 (collectively, the "Convertible Notes") was $3.7 million with coupon interest expense of $2.5 million and amortization of debt discount and issuance costs of $1.2 million. For each of the nine months ended September 30, 2022 and 2021, total interest expense related to the Convertible Notes was $11.1 million with coupon interest expense of $7.4 million and amortization of debt discount and issuance costs of $3.7 million.
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Fair Value Measurements |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Fair Value Measurements The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis in the condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021, based on the three-tier fair value hierarchy, as defined in ASC 820, “Fair Value Measurements and Disclosures”:
The Company assesses the categorization of assets and liabilities by level at each measurement date, and transfers between levels are recognized on the actual date of the event or when changes in circumstances caused the transfer, in accordance with the Company’s accounting policy regarding the recognition of transfers between levels of the fair value hierarchy. There were no transfers between Levels I, II and III during the three and nine months ended September 30, 2022 and 2021. Fair Value of Contingent Consideration Liabilities The fair value of the contingent consideration liabilities related to certain of the Company's acquisitions were estimated using a discounted cash flow method with significant inputs that are not observable in the market and thus represents a Level III fair value measurement. The significant inputs in the Company's Level III fair value measurement not supported by market activity included its assessments of expected future cash flows related to these acquisitions and their ability to meet the target performance objectives during the subsequent periods from the date of acquisition, which management believes are appropriately discounted considering the uncertainties associated with these obligations, and are calculated in accordance with the terms of their respective agreements. The Company will continue to reassess the fair values of the contingent consideration liabilities at each reporting date until settlement. Changes to these estimated fair values will be recognized in the Company's earnings and included in general and administration expenses in the condensed consolidated statements of operations. The Company had contingent consideration liabilities of $0.7 million as of December 31, 2021 which were recorded as a component of Accrued expenses and other liabilities on the condensed consolidated balance sheets. These contingent consideration liabilities were paid in the nine months ended September 30, 2022. The Company had no contingent consideration liabilities as of September 30, 2022. Fair Value of Deferred Compensation Liability The table below presents a reconciliation of the assets used to fund the Company's deferred compensation liability, which is measured at fair value on a recurring basis using significant unobservable inputs (Level III) for the period from December 31, 2021 to September 30, 2022:
The fair market value of the assets used to fund the Company's deferred compensation liability is based upon the cash surrender value of the Company's life insurance premiums. The value of the assets used to fund the Company's deferred compensation liability, which are included in other non-current assets in the condensed consolidated balance sheets, decreased due to net losses on the underlying investment vehicles, partially offset by additional funding. These losses are recognized in the Company's earnings and included in general and administration expenses in the condensed consolidated statements of operations. Fair Value of Debt Agreements The Company considered its Convertible Notes to be Level II liabilities at September 30, 2022 and used a market approach to calculate their respective fair values. The estimated fair value for each convertible note was determined based on estimated or actual bids and offers in an over-the-counter market on September 30, 2022 (See “Note 9—Debt”). As of September 30, 2022 and December 31, 2021, the carrying value of the Convertible Notes due 2023 equaled $343.6 million and $342.0 million, respectively, and represented the aggregate principal amount outstanding less the debt issuance costs. As of September 30, 2022 and December 31, 2021, the estimated fair value of the Convertible Notes due 2023 was $338.1 million and $439.9 million, respectively. As of September 30, 2022 and December 31, 2021, the carrying value of the Convertible Notes due 2025 equaled $509.0 million and $506.8 million, respectively, and represented the aggregate principal amount outstanding less the debt issuance costs. As of September 30, 2022 and December 31, 2021, the estimated fair value of the Convertible Notes due 2025 was $438.6 million and $526.1 million, respectively. Fair Value of Other Financial Assets and Liabilities The Company considered the recorded value of its other financial assets and liabilities, which consist primarily of cash and cash equivalents, accounts receivable and accounts payable, to approximate the fair value of the respective assets and liabilities at September 30, 2022 and December 31, 2021 based upon the short-term nature of these assets and liabilities.
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Revenues and Cost of Revenues |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues and Cost of Revenues | Revenues and Cost of Revenues Disaggregation of Revenue The following table presents the Company’s revenues disaggregated by major source:
The following table presents the Company’s revenues disaggregated by geography, based on the billing address of the customer:
Remaining Performance Obligations The following table includes estimated revenue expected to be recognized in the future as of September 30, 2022:
The remaining performance obligations disclosed above are not indicative of revenue for future periods. Remaining performance obligations represent the transaction price allocated to unsatisfied or partially satisfied performance obligations. The disclosure includes estimates of variable consideration. The Company applies the practical expedients and exemption not to disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less; (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed; and (iii) contracts for which the variable consideration is allocated entirely to a wholly unsatisfied performance obligations or to a wholly unsatisfied promise to transfer a distinct service that forms part of a single performance obligation. Contract Balances Total deferred revenue as of September 30, 2022 increased by $2.9 million from December 31, 2021, primarily the result of revenue growth, timing of cash receipts and revenue recognition. The majority of the Company's deferred revenue will be recognized over the course of the next twelve months. The amount of revenue recognized that was included in the opening deferred revenue balance was $5.5 million and $5.3 million for the three months ended September 30, 2022 and 2021, respectively. The amount of revenue recognized that was included in the opening deferred revenue balance was $31.7 million and $31.6 million for the nine months ended September 30, 2022 and 2021, respectively. The majority of this revenue consists of subscription-based services and professional services arrangements. The amount of revenue recognized from performance obligations satisfied in prior periods was not material. Deferred Sales Incentive Compensation Deferred sales incentive compensation was $11.0 million and $11.8 million as of September 30, 2022 and December 31, 2021, respectively. Amortization expense for the deferred sales incentive compensation was $1.0 million and $1.2 million for the three months ended September 30, 2022 and 2021. Amortization expense for the deferred sales incentive compensation was $3.2 million and $3.3 million for the nine months ended September 30, 2022 and 2021. Deferred sales incentive compensation is included in other non-current assets on the condensed consolidated balance sheets and amortization expense is included in compensation and benefits expenses on the condensed consolidated statements of operations. No significant impairment loss for capitalized costs was recorded during the periods. The Company has applied the practical expedient to recognize the incremental costs of obtaining contracts as an expense when incurred if the amortization period would have been one year or less. These costs are included in compensation and benefits expenses in the condensed consolidated statements of operations. Cost of Revenues The following table summarizes cost of revenues by revenue category:
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Stock-Based Compensation |
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Share-Based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation | Stock-Based Compensation The Company has stock options, restricted stock units (“RSUs”) and performance-based stock units (“PSUs”) outstanding under the 2010 Long-Term Incentive Plan (the “2010 Plan”) and the Envestnet, Inc. 2019 Acquisition Equity Incentive Plan (the “2019 Equity Plan”). As of September 30, 2022, the maximum number of common shares available for future issuance under the Company’s plans is 2,538,508. Stock-based compensation expense under the Company’s plans was as follows:
The tax effect on stock-based compensation expense above was calculated using a blended statutory rate of 25.5% for each of the three and nine months ended September 30, 2022 and 2021. Stock Options The Company did not grant any stock options in the three and nine months ended September 30, 2021 or 2022. The following table summarizes option activity under the Company’s plans:
Exercise prices of stock options outstanding as of September 30, 2022 range from $15.34 to $74.83. At September 30, 2022, there was an immaterial amount of unrecognized stock-based compensation expense related to unvested stock options, which the Company expects to recognize over a weighted-average period of 0.8 years. Restricted Stock Units The Company has granted restricted stock units and performance-based stock units to employees that are unvested. Performance-based stock units vest upon the achievement of certain pre-established business and financial metrics as well as a subsequent service condition. The business and financial metrics governing the vesting of these performance-based stock units provide thresholds that dictate the number of shares to vest upon each evaluation date, which range from 0% to 150%. If these metrics are achieved, as defined in the individual grant terms, these shares would cliff vest three years from the grant date. The following is a summary of the activity for unvested restricted stock units and performance-based stock units granted under the Company’s plans:
At September 30, 2022, there was $109.2 million of unrecognized stock-based compensation expense related to unvested restricted stock units, which the Company expects to recognize over a weighted-average period of 2.0 years. At September 30, 2022, there was $6.4 million of unrecognized stock-based compensation expense related to unvested performance-based restricted stock units, which the Company expects to recognize over a weighted-average period of 1.7 years.
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Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Income Taxes The following table includes the Company’s income (loss) before income tax provision (benefit), income tax provision (benefit) and effective tax rate:
Under ASC 740-270-25, the Company is required to report income tax expense by applying a projected annual effective tax rate ("AETR") to ordinary pre-tax book income for the interim period. The tax impact of discrete items is accounted for separately in the period in which they occur. The effective tax rate ("ETR") for the quarter is the result of the projected AETR applied to actual pre-tax book income plus discrete items as a percentage of pre-tax book income. Therefore, a change in pre-tax book income, either forecasted or actual year-to-date, from one period to the next will cause the ETR to change. For the three and nine months ended September 30, 2022 and 2021, the Company's ETR was impacted by the change in forecasted and actual year-to-date pre-tax book income. For the three months ended September 30, 2022, the Company’s effective tax rate differed from the statutory rate primarily due to the increase in the valuation allowance the Company has placed on a portion of its U.S. deferred tax assets which includes the impact of the Redi2 and Truelytics acquisitions and IRC Section 174, permanent book-tax differences, and the impact of state and local taxes offset by federal and state research and development ("R&D") credits. For the nine months ended September 30, 2022, the Company's effective tax rate differed from the statutory rate primarily due to the increase in the valuation allowance the Company has placed on a portion of its U.S. deferred tax assets which includes the impact of the Redi2 and Truelytics acquisitions and IRC Section 174, permanent book-tax differences, the impact of state and local taxes offset by federal and state R&D credits and the partial reserve release of an uncertain tax position due to the expiration of a statute of limitations. For the three months ended September 30, 2021, the Company's effective tax rate differed from the statutory rate primarily due to the increase in forecasted book income for the year, the decrease in the valuation allowance the Company has placed on a portion of its U.S. deferred tax assets, including the valuation allowance impact of the acquisition of Harvest Savings & Wealth Technologies ("Harvest") in April 2021, and the windfall from stock-based compensation. For the nine months ended September 30, 2021, the Company's effective tax rate differed from the statutory rate primarily due to the increase in the valuation allowance the Company has placed on a portion of its U.S. deferred tax assets, including the valuation allowance impact of the Harvest acquisition, permanent book-tax differences, and the impact of state and local taxes offset by federal and state R&D credits. Inflation Reduction Act of 2022 On August 16, 2022, the U.S. enacted the Inflation Reduction Act of 2022 ("IRA"), which, among other things, implements a 15% minimum tax on book income of certain large corporations and a 1% excise tax on net stock repurchases. The provisions of the IRA are effective beginning in 2023. The Company is currently evaluating the impacts of this act on the consolidated financial statements.
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Net Income (Loss) Per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income (Loss) Per Share | Net Income (Loss) Per Share Basic net income (loss) per common share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock outstanding for the period. For the calculation of diluted net income (loss) per share, the basic weighted average number of shares is increased by the dilutive effect of stock options, common warrants, restricted stock awards and restricted stock units and convertible notes, if dilutive, using either the treasury method or if-converted method as appropriate. The following table provides the numerators and denominators used in computing basic and diluted net income (loss) per share attributable to Envestnet, Inc.:
Securities that were anti-dilutive and therefore excluded from the computation of diluted net income (loss) per share were as follows:
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information Business segments are generally organized around the Company's business services. The Company's business segments are: •Envestnet Wealth Solutions – a leading provider of unified wealth management software and services to empower financial advisors and institutions to enable them to deliver an intelligent financial life to their clients. •Envestnet Data & Analytics – a leading data aggregation, intelligence, and experiences platform that powers data connectivity and business intelligence across digital financial services to enable them to deliver an Intelligent Financial Life to their clients. The information in the following tables is derived from the Company’s internal financial reporting used for corporate management purposes. Nonsegment operating expenses may include salary and benefits for certain corporate officers, certain types of professional service expenses and insurance, acquisition related transaction costs, certain restructuring charges and other non-recurring and/or non-operationally related expenses. Intersegment revenues were not material for the three and nine months ended September 30, 2022 and 2021. See “Note 11—Revenues and Cost of Revenues” for detail of revenues by segment. The following table presents a reconciliation from income (loss) from operations by segment to consolidated net income (loss) attributable to Envestnet, Inc.:
A summary of consolidated total assets follows:
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Geographical Information |
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Geographical Information | Geographical Information The following table sets forth certain long-lived assets including property and equipment, net and internally developed software, net by geographic area:
See “Note 11—Revenues and Cost of Revenues” for detail of revenues by geographic area.
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Commitments |
9 Months Ended |
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Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Commitments Purchase Obligations and Indemnifications The Company includes various types of indemnification and guarantee clauses in certain arrangements. These indemnifications and guarantees may include, but are not limited to, infringement claims related to intellectual property, direct or consequential damages and guarantees to certain service providers and service level requirements with certain customers. The type and amount of any potential indemnification or guarantee varies substantially based on the nature of each arrangement. The Company has experienced no previous claims and cannot determine the maximum amount of potential future payments, if any, related to such indemnification and guarantee provisions. The Company believes that it is unlikely it will have to make material payments under these arrangements and therefore has not recorded a contingent liability associated with these arrangements in the condensed consolidated balance sheets. The Company enters into unconditional purchase obligations arrangements for certain of its services that it receives in the normal course of business. Procurement of Technology Solutions On April 1, 2022, the Company entered into a purchase agreement with a privately held company to acquire the technology solutions being developed by this privately held company for a purchase price of $9.0 million. The Company has paid a $4.0 million advance during the nine months ended September 30, 2022. This advance is included in other non-current assets in the condensed consolidated balance sheets. Legal Proceedings The Company and its subsidiary, Yodlee, Inc. (“Yodlee”), have been named as defendants in a lawsuit filed on July 17, 2019, by FinancialApps, LLC (“FinancialApps”) in the United States District Court for the District of Delaware. The case caption is FinancialApps, LLC v. Envestnet Inc., et al., No. 19-cv-1337 (D. Del.). FinancialApps alleges that, after entering into a 2017 services agreement with Yodlee, Envestnet and Yodlee breached the agreement and misappropriated proprietary information to develop competing credit risk assessment software. The complaint includes claims for, among other things, misappropriation of trade secrets, fraud, tortious interference with prospective business opportunities, unfair competition, copyright infringement and breach of contract. FinancialApps is seeking significant monetary damages and various equitable and injunctive relief. On September 17, 2019, the Company and Yodlee filed a motion to dismiss certain of the claims in the complaint filed by FinancialApps, including the copyright infringement, unfair competition and fraud claims. On August 25, 2020, the District Court granted in part and denied in part the Company and Yodlee’s motion. Specifically, the Company and Yodlee prevailed on FinancialApps’ counts alleging copyright infringement and violations of the Illinois Deceptive Trade Practices Act. And while the Court was receptive to Envestnet and Yodlee’s argument that several of FinancialApps’ other counts are based on allegations that amount to copyright infringement—and therefore should fail due to copyright preemption—the Court found that FinancialApps had alleged enough conduct distinct from copyright infringement to survive dismissal at this early stage. On October 30, 2019, the Company and Yodlee filed counterclaims against FinancialApps. Yodlee alleges that FinancialApps fraudulently induced it to enter into contracts with FinancialApps, then breached those contracts. FinancialApps has filed a motion to dismiss Yodlee’s counterclaims. On September 15, 2020, the District Court denied FinancialApps’ motion on all counts except for the breach-of-contract claim which was dismissed on a pleading technicality without prejudice. On that count, the Court granted Yodlee leave to amend its counterclaim, cure the technical deficiency, and reassert its claim. Yodlee and Envestnet filed amended counterclaims on September 30, 2020. The amended counterclaims (1) cure that technical deficiency and reassert Yodlee’s contract counterclaim; and (2) broaden the defamation counterclaims arising out of various defamatory statements FinancialApps disseminated in the trade press after filing the lawsuit. On January 14, 2021, the Court ordered that (i) FinancialApps’s claims against Yodlee—as well as Yodlee’s counterclaims against FinancialApps—must be tried before the judge instead of a jury pursuant to a jury waiver provision in the parties’ agreement; and (ii) FinancialApps’s claims against Envestnet (and Envestnet’s counterclaim) must be heard by a jury. The Court has scheduled the Envestnet jury trial to take place before the Yodlee bench trial. Fact discovery closed on April 23, 2021, other than a few outstanding matters, and expert discovery concluded on September 30, 2022. The Company believes FinancialApps’s allegations are without merit and will continue to defend the claims against it and litigate the counterclaims vigorously. The Company and Yodlee were also named as defendants in a putative class action lawsuit filed on August 25, 2020, by Plaintiff Deborah Wesch in the United States District Court for the Northern District of California. On October 21, 2020, an amended class action complaint was filed by Plaintiff Wesch and nine additional named plaintiffs. The case caption is Deborah Wesch, et al., v. Yodlee, Inc., et al., Case No. 3:20-cv-05991-SK. Plaintiffs allege that Yodlee unlawfully collected their financial transaction data when plaintiffs linked their bank accounts to a mobile application that uses Yodlee’s API, and plaintiffs further allege that Yodlee unlawfully sold the transaction data to third parties. The complaint alleges violations of certain California statutes and common law, including the Unfair Competition Law, and federal statutes, including the Stored Communications Act. Plaintiffs are seeking monetary damages and equitable and injunctive relief on behalf of themselves and a putative nationwide class and California subclass of persons who provided their log-in credentials to a Yodlee-powered app in an allegedly similar manner from 2014 to the present. The Company believes that it is not properly named as a defendant in the lawsuit and it further believes, along with Yodlee, that plaintiffs’ claims are without merit. On November 4, 2020, the Company and Yodlee filed separate motions to dismiss all of the claims in the complaint. On February 16, 2021, the district court granted in part and denied in part Yodlee’s motion to dismiss the amended complaint and granted the plaintiffs leave to further amend. The Court reserved ruling on the Company’s motion to dismiss and granted limited jurisdictional discovery to the plaintiffs. On March 15, 2021, Plaintiffs filed a second amended class action complaint re-alleging, among others, the claims the district court had dismissed. The second amended complaint did not allege any claims against the Company or Yodlee that were not previously alleged in first amended complaint. On May 5, 2021, the Company filed a motion to dismiss all claims asserted against it in the second amended complaint, and Yodlee filed a motion to dismiss most claims asserted against it in the second amended complaint. On July 19, 2021, the Court granted in part Yodlee’s motion, resulting in the dismissal of all federal law claims and two of the state-law claims. On August 5, 2021, the Court granted the Company's motion to dismiss, and dismissed the Company from the lawsuit. On October 8, 2021, Yodlee filed a motion for summary judgment, which has been fully briefed. Oral argument on Yodlee’s motion was heard on September 19, 2022, and the motion has been submitted for decision. On August 12, 2022, Plaintiffs moved for leave to file a third amended complaint, which Yodlee opposed. On September 29, 2022, the Court denied Plaintiffs’ motion to amend the complaint. Yodlee will continue to vigorously defend the remaining claims against it. In addition, the Company is involved in legal proceedings arising in the ordinary course of its business. Legal fees and other costs associated with such actions are expensed as incurred. The Company will record a provision for these claims when it is both probable that a liability has been incurred and the amount of the loss, or a range of the potential loss, can be reasonably estimated. These provisions are reviewed regularly and adjusted to reflect the impacts of negotiations, settlements, rulings, advice of legal counsel, and other information or events pertaining to a particular case. For litigation matters where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established, but if the matter is material, it is subject to disclosures. The Company believes that liabilities associated with any claims, while possible, are not probable, and therefore has not recorded any accrual for any claims as of September 30, 2022. Further, while any possible range of loss cannot be reasonably estimated at this time, the Company does not believe that the outcome of any of these proceedings, individually or in the aggregate, would, if determined adversely to it, have a material adverse effect on its financial condition or business, although an adverse resolution of legal proceedings could have a material adverse effect on the Company's results of operations or cash flow in a particular quarter or year.
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Subsequent Events |
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Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Entry into Outsourcing Arrangement and Organizational Realignment In October 2022, the Company entered into an outsourcing arrangement with Tata Consultancy Services (“TCS”) to increase operational scale and business agility. Under this agreement, the Company will outsource certain administrative and operational services of the Envestnet Data & Analytics business located in Bangalore, India. The agreement became effective in October 2022 and will continue for a period of ten years. In connection with this arrangement, the Company anticipates it will incur severance expense in the fourth quarter of 2022. In certain circumstances, the Company may terminate certain portions of the agreement, and in doing so, the agreement requires the Company to pay significant termination fees. In the fourth quarter of 2022, as part of an organizational realignment, the Company entered into separation agreements with a number of employees. This realignment will allow Envestnet to operate more efficiently and prioritize activities and services that will benefit its clients and the future of its business. In connection with the outsourcing arrangement with TCS and the organizational realignment, the Company estimates it will incur approximately $15 million of total severance expense during the fourth quarter of 2022.
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Basis of Presentation (Policies) |
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Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted Accounting Pronouncements— In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805).” This update amends Topic 805 to add contract assets and contract liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure contract assets and contract liabilities in accordance with ASC 606. This standard is effective for financial statements issued by public companies for annual and interim periods beginning after December 15, 2022. Early adoption of the standard is permitted. The amendment is to be applied prospectively to business combinations occurring on or after the effective date of the amendment. The Company adopted this standard as of January 1, 2022. Adoption of this standard did not have a material impact on the Company's condensed consolidated financial statements.
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Basis of Presentation (Tables) |
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Schedule of Cash and Cash Equivalents | The following table reconciles amounts from the condensed consolidated balance sheets to cash, cash equivalents and restricted cash reported within the condensed consolidated statements of cash flows:
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Schedule of Reconciliation of Cash, Cash Equivalents and Restricted Cash | The following table reconciles amounts from the condensed consolidated balance sheets to cash, cash equivalents and restricted cash reported within the condensed consolidated statements of cash flows:
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Acquisitions and Other Investments (Tables) |
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of the assets acquired at the date of acquisition:
The following table summarizes the estimated fair values of the assets acquired at the date of acquisition:
In connection with the Redi2 Technologies Acquisition, the Company paid estimated consideration as follows:
The following table summarizes the estimated fair values of the assets acquired at the date of acquisition:
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Schedule of Intangible Assets Acquired, Estimated Useful Lives and Amortization Method | A summary of estimated intangible assets acquired, estimated useful lives and amortization method is as follows:
A summary of estimated intangible assets acquired, estimated useful lives and amortization method is as follows:
A summary of estimated intangible assets acquired, estimated useful lives and amortization method is as follows:
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Prepaid Expenses and Other Current Assets (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following:
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Property and Equipment, Net (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of components of property and equipment, net | Property and equipment, net consisted of the following:
Depreciation and amortization expense was as follows:
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Internally Developed Software (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Research and Development [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Internally Developed Software, Net | Internally developed software, net consisted of the following:
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Schedule of Amortization Expense | Amortization expense was as follows:
|
Goodwill and Intangible Assets, Net (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill by Segment | Changes in the carrying amount of goodwill were as follows:
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Schedule of Intangible Assets, Net | Intangible assets, net consisted of the following:
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Schedule of Amortization Expense | Amortization expense was as follows:
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Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Future amortization expense of the Company's intangible assets as of September 30, 2022, is expected to be as follows:
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Accrued Expenses and Other Liabilities (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accrued Expenses and Other Liabilities | Accrued expenses and other liabilities consisted of the following:
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Debt (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Convertible Debt Obligations | The Company’s outstanding debt obligations as of September 30, 2022 and December 31, 2021 were as follows:
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Schedule of Interest Expense | Interest expense was comprised of the following and is included in other expense, net in the condensed consolidated statements of operations:
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Fair Value Measurements (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Financial Assets and Liabilities Measured at Fair Value | The following tables set forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis in the condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021, based on the three-tier fair value hierarchy, as defined in ASC 820, “Fair Value Measurements and Disclosures”:
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Schedule of Reconciliation of Assets | The table below presents a reconciliation of the assets used to fund the Company's deferred compensation liability, which is measured at fair value on a recurring basis using significant unobservable inputs (Level III) for the period from December 31, 2021 to September 30, 2022:
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Revenue and Cost of Revenues (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disaggregation of Revenue by Major Source | The following table presents the Company’s revenues disaggregated by major source:
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Schedule of Disaggregation of Revenue by Geography | The following table presents the Company’s revenues disaggregated by geography, based on the billing address of the customer:
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Schedule of Estimated Revenue Expected to be Recognized in the Future | The following table includes estimated revenue expected to be recognized in the future as of September 30, 2022:
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Schedule of Costs of Revenues by Revenue Category | The following table summarizes cost of revenues by revenue category:
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Stock-Based Compensation (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Stock-Based Compensation Expense | Stock-based compensation expense under the Company’s plans was as follows:
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Schedule of Option Activity under the Company's Plans | The following table summarizes option activity under the Company’s plans:
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Schedule of the Activity for Unvested Restricted Stock Units and Awards Granted under the Company's Plans | The following is a summary of the activity for unvested restricted stock units and performance-based stock units granted under the Company’s plans:
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Income Taxes (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Income (Loss) before Income Tax Provision (Benefit) | The following table includes the Company’s income (loss) before income tax provision (benefit), income tax provision (benefit) and effective tax rate:
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Net Income (Loss) Per Share (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reconciliation of the Numerators and Denominators used in Computing Basic and Diluted Net Income (Loss) per Share Attributable to Common Stockholders | The following table provides the numerators and denominators used in computing basic and diluted net income (loss) per share attributable to Envestnet, Inc.:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Anti-Dilutive Securities Excluded from Computation of Diluted Earnings per Share | Securities that were anti-dilutive and therefore excluded from the computation of diluted net income (loss) per share were as follows:
|
Segment Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Income (Loss) from Operations by Segment | The following table presents a reconciliation from income (loss) from operations by segment to consolidated net income (loss) attributable to Envestnet, Inc.:
|
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Schedule of Consolidated Total Assets | A summary of consolidated total assets follows:
|
Geographical Information (Tables) |
9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segments, Geographical Areas [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property, Plant, and Equipment, Net by Geographic Area | The following table sets forth certain long-lived assets including property and equipment, net and internally developed software, net by geographic area:
|
Organization and Description of Business (Details) |
9 Months Ended |
---|---|
Sep. 30, 2022
segment
| |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | 2 |
Basis of Presentation - Schedule of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Dec. 31, 2021 |
Sep. 30, 2021 |
Dec. 31, 2020 |
---|---|---|---|---|
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 241,330 | $ 429,279 | $ 393,799 | |
Restricted cash included in prepaid expenses and other current assets | 0 | 149 | ||
Total cash, cash equivalents and restricted cash | $ 241,330 | $ 429,428 | $ 393,948 | $ 384,714 |
Acquisitions and Other Investments - Investments in Privately Held Companies - Narrative (Details) $ in Thousands |
7 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 02, 2022
USD ($)
qtr
|
May 20, 2022
USD ($)
qtr
|
Dec. 31, 2022
USD ($)
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2021
USD ($)
|
Jun. 30, 2022 |
|
Business Acquisition [Line Items] | ||||||
Payments to acquire equity method investments | $ 16,351 | $ 8,926 | ||||
Privately Held Company | ||||||
Business Acquisition [Line Items] | ||||||
Ownership percentage acquired | 43.00% | 25.00% | ||||
Payments to acquire equity method investments | $ 8,400 | $ 5,000 | ||||
Number of quarter lag from actual result | qtr | 1 | 1 | ||||
Ownership percentage | 48.00% | 41.00% | ||||
Allocated to intangible assets | $ 7,800 | |||||
Amortization period | 5 years | |||||
Privately Held Company | Forecast | ||||||
Business Acquisition [Line Items] | ||||||
Payments to acquire equity method investments | $ 10,000 |
Acquisitions and Other Investments - Acquisition of 401kplans.com - Narrative (Details) $ in Millions |
May 31, 2022
USD ($)
|
---|---|
401kplans.com acquisition | |
Business Acquisition [Line Items] | |
Cash consideration, net | $ 14.5 |
Acquisitions and Other Investments - Acquisition of 401kplans.com -Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
4 Months Ended | ||
---|---|---|---|
Sep. 30, 2022 |
May 31, 2022 |
Dec. 31, 2021 |
|
Business Acquisition [Line Items] | |||
Goodwill | $ 996,267 | $ 925,154 | |
401kplans.com acquisition | |||
Business Acquisition [Line Items] | |||
Tangible assets acquired, net of acquired cash | 104 | $ 94 | |
Deferred tax assets acquired, measurement period adjustments | 10 | ||
Identifiable intangible assets | 3,000 | 3,000 | |
Goodwill | 11,396 | 11,378 | |
Goodwill, measurement period adjustments | 18 | ||
Total net assets acquired | 14,500 | $ 14,472 | |
Total net assets acquired, measurement period adjustments | $ 28 |
Acquisitions and Other Investments - Acquisition of 401kplans.com - Estimated Intangible Assets Acquired (Details) - Proprietary technology - USD ($) $ in Thousands |
May 31, 2022 |
Jun. 21, 2021 |
---|---|---|
Business Acquisition [Line Items] | ||
Estimated Useful Life in Years | 5 years | |
401kplans.com acquisition | ||
Business Acquisition [Line Items] | ||
Preliminary Estimate (in thousands) | $ 3,000 | |
Estimated Useful Life in Years | 5 years |
Acquisitions and Other Investments - Acquisition of Truelytics - Narrative (Details) $ in Millions |
Jul. 01, 2022
USD ($)
|
---|---|
Truelytics acquisition | |
Business Acquisition [Line Items] | |
Cash consideration, net | $ 20.7 |
Acquisitions and Other Investments - Acquisition of Truelytics -Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Jul. 01, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Business Acquisition [Line Items] | |||
Goodwill | $ 996,267 | $ 925,154 | |
Truelytics acquisition | |||
Business Acquisition [Line Items] | |||
Tangible assets acquired, net of acquired cash | $ 532 | ||
Identifiable intangible assets | 4,000 | ||
Goodwill | 16,195 | ||
Total net assets acquired | $ 20,727 |
Acquisitions and Other Investments - Acquisition of Truelytics - Estimated Intangible Assets Acquired (Details) - Proprietary technology - USD ($) $ in Thousands |
Jul. 01, 2022 |
Jun. 21, 2021 |
---|---|---|
Business Acquisition [Line Items] | ||
Estimated Useful Life in Years | 5 years | |
Truelytics acquisition | ||
Business Acquisition [Line Items] | ||
Preliminary Estimate (in thousands) | $ 4,000 | |
Estimated Useful Life in Years | 5 years |
Acquisitions and Other Investments - Acquisition of Redi2 Technologies - Cash Consideration (Details) - Redi2 Technologies acquisition $ in Thousands |
Jul. 01, 2022
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Cash consideration, net | $ 69,406 |
Estimated working capital adjustment | (1,465) |
Total | $ 67,941 |
Acquisitions and Other Investments - Acquisition of Redi2 Technologies - Narrative (Details) - Redi2 Technologies acquisition $ in Millions |
Jul. 01, 2022
USD ($)
|
---|---|
Business Acquisition [Line Items] | |
Goodwill, expected tax deductible amount | $ 39.5 |
Certain Executives | |
Business Acquisition [Line Items] | |
Additional contingent consideration | $ 20.0 |
Acquisitions and Other Investments - Acquisition of Redi2 Technologies -Estimated Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Jul. 01, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Business Acquisition [Line Items] | |||
Goodwill | $ 996,267 | $ 925,154 | |
Redi2 Technologies acquisition | |||
Business Acquisition [Line Items] | |||
Total current assets | $ 1,985 | ||
Other non-current assets | 3,349 | ||
Identifiable intangible assets | 26,500 | ||
Goodwill | 44,236 | ||
Total assets acquired | 76,070 | ||
Accounts payable and accrued expenses | (1,157) | ||
Operating lease liabilities | (2,201) | ||
Deferred revenue | (4,771) | ||
Total liabilities assumed | (8,129) | ||
Total net assets acquired, net of cash received | $ 67,941 |
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid technology | $ 20,240 | $ 15,415 |
Non-income tax receivables | 5,768 | 7,013 |
Acquisition related receivables | 4,429 | 2,951 |
Prepaid insurance | 4,248 | 2,234 |
Income tax prepayments and receivables | 2,978 | 1,310 |
Loan to equity method investee | 2,018 | 0 |
Other | 15,397 | 13,783 |
Total prepaid expenses and other current assets | $ 55,078 | $ 42,706 |
Property and Equipment, Net - Narrative (Details) $ in Millions |
1 Months Ended | 3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|---|
Apr. 30, 2022
office
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2021
USD ($)
|
Sep. 30, 2022
USD ($)
|
Sep. 30, 2021
USD ($)
|
|
Property, Plant and Equipment [Line Items] | |||||
Number of offices set for closure | office | 3 | ||||
Envestnet Wealth Solutions | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment retired | $ 0.1 | $ 1.8 | $ 16.6 | $ 9.6 | |
Gain on asset retirement | 0.0 | 3.7 | |||
Lease restructuring cost | 1.1 | 14.1 | |||
Envestnet Data & Analytics | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment retired | 1.7 | 0.4 | 2.9 | 1.0 | |
Gain on asset retirement | 0.0 | $ 0.0 | 0.0 | $ 0.0 | |
Leased data servers | |||||
Property, Plant and Equipment [Line Items] | |||||
Gross property and equipment under finance lease | 15.9 | 15.9 | |||
Property and equipment under finance lease, accumulated depreciation | $ 3.6 | $ 3.6 |
Internally Developed Software - Components of Internally Developed Software (Details) - USD ($) $ in Thousands |
9 Months Ended | |
---|---|---|
Sep. 30, 2022 |
Dec. 31, 2021 |
|
Property, Plant and Equipment [Line Items] | ||
Less: accumulated amortization | $ (118,743) | $ (91,721) |
Internally developed software, net | $ 173,285 | 133,659 |
Internally developed software | ||
Property, Plant and Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Internally developed software | $ 292,028 | $ 225,380 |
Internally Developed Software - Amortization Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Research and Development [Abstract] | ||||
Amortization expense | $ 9,441 | $ 7,462 | $ 27,022 | $ 20,995 |
Goodwill and Intangible Assets, Net - Narrative (Details) - USD ($) $ in Thousands |
1 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Apr. 01, 2022 |
Jun. 21, 2021 |
Feb. 28, 2022 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Asset Acquisition [Line Items] | |||||
Payments to acquire intangible assets | $ 15,000 | $ 25,517 | |||
Proprietary technology | |||||
Asset Acquisition [Line Items] | |||||
Consideration transferred | $ 9,000 | $ 18,000 | |||
Payments to acquire intangible assets | $ 4,000 | $ 3,000 | $ 15,000 | ||
Amortization period | 5 years | ||||
Earn-out payment | $ 10,000 | ||||
Target metrics term | 5 years |
Goodwill and Intangible Assets, Net - Schedule of Intangible Assets, Net (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 760,604 | $ 709,104 |
Accumulated Amortization | (362,522) | (308,708) |
Net Carrying Amount | 398,082 | 400,396 |
Customer lists | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 604,080 | 590,080 |
Accumulated Amortization | (274,310) | (241,189) |
Net Carrying Amount | 329,770 | 348,891 |
Proprietary technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 119,824 | 85,324 |
Accumulated Amortization | (59,892) | (43,004) |
Net Carrying Amount | 59,932 | 42,320 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 36,700 | 33,700 |
Accumulated Amortization | (28,320) | (24,515) |
Net Carrying Amount | $ 8,380 | $ 9,185 |
Goodwill and Intangible Assets, Net - Amortization Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 18,649 | $ 17,390 | $ 53,814 | $ 51,370 |
Goodwill and Intangible Assets, Net - Future Amortization Expense (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2022 | $ 18,087 | |
2023 | 60,087 | |
2024 | 53,240 | |
2025 | 49,900 | |
2026 | 41,997 | |
Thereafter | 174,771 | |
Intangible assets, net | $ 398,082 | $ 400,396 |
Accrued Expenses and Other Liabilities (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Payables and Accruals [Abstract] | ||
Accrued investment manager fees | $ 104,165 | $ 95,858 |
Accrued compensation and related taxes | 70,252 | 97,523 |
Accrued professional services | 9,112 | 7,746 |
Accrued technology | 5,563 | 8,951 |
Non-income tax payables | 2,789 | 4,907 |
Other accrued expenses | 15,144 | 10,174 |
Total accrued expenses and other liabilities | $ 207,025 | $ 225,159 |
Debt - Summary of Outstanding Debt (Details) - USD ($) |
Sep. 30, 2022 |
Dec. 31, 2021 |
Aug. 31, 2020 |
May 31, 2018 |
---|---|---|---|---|
Convertible Notes due 2023 | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 345,000,000 | |||
Convertible Notes due 2025 | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 517,500,000 | |||
Convertible Notes Payable | Convertible Notes due 2023 | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 345,000,000 | $ 345,000,000 | ||
Unamortized issuance costs on Convertible Notes | (1,419,000) | (2,979,000) | ||
Convertible notes carrying value | 343,581,000 | 342,021,000 | ||
Convertible Notes Payable | Convertible Notes due 2025 | ||||
Debt Instrument [Line Items] | ||||
Face amount | 517,500,000 | 517,500,000 | ||
Unamortized issuance costs on Convertible Notes | (8,494,000) | (10,659,000) | ||
Convertible notes carrying value | 509,006,000 | 506,841,000 | ||
Revolving Credit Facility | Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility balance | $ 0 | $ 0 |
Debt - Convertible Notes due 2023 and 2025 (Details) - USD ($) |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
Aug. 31, 2020 |
May 31, 2018 |
|
Convertible Notes due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 345,000,000 | |||||
Interest rate | 1.75% | |||||
Effective interest rate | 2.40% | 2.40% | 2.40% | 2.40% | ||
Convertible Notes due 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 517,500,000 | |||||
Interest rate | 0.75% | |||||
Effective interest rate | 1.30% | 1.30% | 1.30% | 1.30% |
Debt - Interest Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Debt Disclosure [Abstract] | ||||
Coupon interest | $ 2,479 | $ 2,479 | $ 7,439 | $ 7,439 |
Amortization of issuance costs | 1,443 | 1,443 | 4,917 | 4,295 |
Undrawn and other fees | 320 | 320 | 951 | 948 |
Total interest expense | $ 4,242 | $ 4,242 | $ 13,307 | $ 12,682 |
Debt - Interest Expense - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Debt Instrument [Line Items] | ||||
Interest expense debt | $ 4,242 | $ 4,242 | $ 13,307 | $ 12,682 |
Interest expense debt excluding amortization | 2,479 | 2,479 | 7,439 | 7,439 |
Convertible Notes Payable | ||||
Debt Instrument [Line Items] | ||||
Interest expense debt | 3,700 | 3,700 | 11,100 | 11,100 |
Interest expense debt excluding amortization | 2,500 | 2,500 | 7,400 | 7,400 |
Amortization of debt discount and issuance costs | $ 1,200 | $ 1,200 | $ 3,700 | $ 3,700 |
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands |
9 Months Ended | 12 Months Ended | |
---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Dec. 31, 2021 |
|
Fair Value Measurements | |||
Fair market value adjustment to contingent consideration liability | $ 0 | $ (1,067) | |
Convertible Notes due 2023 | |||
Fair Value Measurements | |||
Debt instrument, fair value disclosure | 338,100 | $ 439,900 | |
Convertible Notes due 2023 | Carrying Value | |||
Fair Value Measurements | |||
Convertible notes | 343,600 | 342,000 | |
Convertible Notes due 2025 | |||
Fair Value Measurements | |||
Debt instrument, fair value disclosure | 438,600 | 526,100 | |
Convertible Notes due 2025 | Carrying Value | |||
Fair Value Measurements | |||
Convertible notes | $ 509,000 | 506,800 | |
Private A I Company Acquisition | |||
Fair Value Measurements | |||
Fair market value adjustment to contingent consideration liability | $ 700 |
Fair Value Measurements - Level III (Details) $ in Thousands |
9 Months Ended |
---|---|
Sep. 30, 2022
USD ($)
| |
Fair Value of Assets to Fund Deferred Compensation Liability | |
Beginning balance | $ 11,140 |
Contributions | 649 |
Fair value adjustments and fees | (2,099) |
Ending balance | $ 9,690 |
Revenue and Cost of Revenues - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
Dec. 31, 2021 |
|
Revenue from Contract with Customer [Abstract] | |||||
Increase in contract with customer, liability | $ 2.9 | ||||
Recognized deferred revenue | $ 5.5 | $ 5.3 | 31.7 | $ 31.6 | |
Deferred sales incentive compensation | 11.0 | 11.0 | $ 11.8 | ||
Amortization expense for the deferred sales incentive compensation | $ 1.0 | $ 1.2 | 3.2 | 3.3 | |
Impairment loss for capitalized costs | $ 0.0 | $ 0.0 |
Revenue and Cost of Revenues - Cost of Revenues (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Product Information [Line Items] | ||||
Cost of revenues | $ 110,108 | $ 109,836 | $ 361,872 | $ 303,199 |
Asset-based | ||||
Product Information [Line Items] | ||||
Cost of revenues | 102,409 | 102,298 | 332,138 | 281,829 |
Subscription-based | ||||
Product Information [Line Items] | ||||
Cost of revenues | 7,768 | 7,355 | 22,820 | 20,986 |
Professional services and other | ||||
Product Information [Line Items] | ||||
Cost of revenues | $ (69) | $ 183 | $ 6,914 | $ 384 |
Stock-Based Compensation - Narrative (Details) - shares |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Share-Based Payment Arrangement [Abstract] | ||||
Maximum number of shares available for future issuance (in shares) | 2,538,508 | 2,538,508 | ||
Statutory rate (as a percent) | 25.50% | 25.50% | 25.50% | 25.50% |
Stock-Based Compensation - Expense (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Share-Based Payment Arrangement [Abstract] | ||||
Stock-based compensation expense | $ 17,265 | $ 18,512 | $ 61,831 | $ 49,934 |
Tax effect on stock-based compensation expense | (4,403) | (4,720) | (15,767) | (12,733) |
Net effect on income | $ 12,862 | $ 13,792 | $ 46,064 | $ 37,201 |
Income Taxes - Income (Loss) Before Income Tax Provision (Benefit) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2022 |
Sep. 30, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Income Tax Disclosure [Abstract] | ||||
Income (loss) before income tax provision (benefit) | $ (6,392) | $ 10,584 | $ (49,181) | $ 27,078 |
Income tax provision (benefit) | $ 2,271 | $ (854) | $ (1,542) | $ 9,074 |
Effective tax rate | (35.50%) | (8.10%) | 3.10% | 33.50% |
Segment Information - Reconciliation of Income (Loss) From Operations (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Sep. 30, 2022 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Sep. 30, 2021 |
Jun. 30, 2021 |
Mar. 31, 2021 |
Sep. 30, 2022 |
Sep. 30, 2021 |
|
Segment Reporting Information [Line Items] | ||||||||
Loss from continuing operations | $ (1,046) | $ 14,135 | $ (39,490) | $ 41,881 | ||||
Nonsegment operating expenses | (307,741) | (288,918) | (986,400) | (825,015) | ||||
Other expense, net | (5,346) | (3,551) | (9,691) | (14,803) | ||||
Income (loss) before income tax provision (benefit) | (6,392) | 10,584 | (49,181) | 27,078 | ||||
Income tax provision (benefit) | 2,271 | (854) | (1,542) | 9,074 | ||||
Net income (loss) | (8,663) | $ (24,268) | $ (14,708) | 11,438 | $ (8,369) | $ 14,935 | (47,639) | 18,004 |
Add: Net loss attributable to non-controlling interest | 1,373 | 302 | 3,205 | 401 | ||||
Net income (loss) attributable to Envestnet, Inc. | (7,290) | 11,740 | (44,434) | 18,405 | ||||
Operating Segments | Envestnet Wealth Solutions | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Loss from continuing operations | 20,607 | 34,386 | 49,844 | 101,042 | ||||
Operating Segments | Envestnet Data & Analytics | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Loss from continuing operations | 74 | 1,265 | (9,218) | 3,896 | ||||
Nonsegment | ||||||||
Segment Reporting Information [Line Items] | ||||||||
Nonsegment operating expenses | $ (21,727) | $ (21,516) | $ (80,116) | $ (63,057) |
Segment Information - Summary of Consolidated Total Assets (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Segment Reporting Information [Line Items] | ||
Assets | $ 2,203,221 | $ 2,241,182 |
Envestnet Wealth Solutions | ||
Segment Reporting Information [Line Items] | ||
Assets | 1,558,756 | 1,720,779 |
Envestnet Data & Analytics | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 644,465 | $ 520,403 |
Geographical Information (Details) - USD ($) $ in Thousands |
Sep. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | $ 233,346 | $ 183,874 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | 230,990 | 180,680 |
India | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | 2,223 | 2,923 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total long-lived assets, net | $ 133 | $ 271 |
Commitments (Details) $ in Thousands |
1 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Apr. 01, 2022
USD ($)
|
Jul. 19, 2021
claim
|
Jun. 21, 2021
USD ($)
|
Oct. 21, 2020
plaintiff
|
Feb. 28, 2022
USD ($)
|
Sep. 30, 2022
USD ($)
claim
|
Sep. 30, 2021
USD ($)
|
|
Other Commitments [Line Items] | |||||||
Number of previous claims experienced | claim | 0 | ||||||
Payments to acquire intangible assets | $ 15,000 | $ 25,517 | |||||
Case No. 3:20-cv-05991-SK | |||||||
Other Commitments [Line Items] | |||||||
Number of plaintiffs | plaintiff | 9 | ||||||
Claims dismissed | claim | 2 | ||||||
Proprietary technology | |||||||
Other Commitments [Line Items] | |||||||
Consideration transferred | $ 9,000 | $ 18,000 | |||||
Payments to acquire intangible assets | $ 4,000 | $ 3,000 | $ 15,000 |
Subsequent Events (Details) $ in Millions |
Oct. 31, 2022
USD ($)
|
---|---|
Subsequent Event | Envestnet Data & Analytics | |
Subsequent Event [Line Items] | |
Expected cost | $ 15 |
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