Balance Sheet Components

12 Months Ended

Dec. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheet Components

Balance Sheet Components

Accounts Receivable, Net

Activity in the allowance for doubtful accounts was as follows:

	Year Ended December 31,
	2023		2022		2021
	(in thousands)
Beginning balance	$	3,134	$	2,644	$	1,703
Provision for bad debt	13,641		4,836		3,735
Write-off of uncollectible accounts receivable	(10,779)		(4,346)		(2,794)
Ending balance	$	5,996	$	3,134	$	2,644

Property and Equipment, Net

Property and equipment, net consisted of the following:

	December 31,
	2023		2022
	(in thousands)
Property and equipment:
Servers—network infrastructure	$	330,295	$	239,828
Construction in progress	45,557		72,827
Capitalized internal-use software	75,163		88,541
Office and computer equipment	32,043		30,577
Office furniture	9,003		6,547
Software	5,422		5,962
Leasehold improvements	42,984		20,392
Asset retirement obligation	826		827
Gross property and equipment	541,293		465,501
Less accumulated depreciation and amortization	(218,480)		(178,901)
Total property and equipment, net	$	322,813	$	286,600

Depreciation and amortization expense on property and equipment for the years ended December 31, 2023, 2022, and 2021 was $113.4 million, $84.8 million, and $62.3 million, respectively. This includes amortization expense for capitalized internal-use software which totaled $21.5 million, $20.2 million, and $17.9 million for the years ended December 31, 2023, 2022, and 2021, respectively.

Goodwill

As of December 31, 2023 and 2022, the Company's goodwill was $148.0 million. During the year ended December 31, 2022, the Company recorded $5.0 million and $120.8 million of goodwill in connection with the acquisitions of Vectrix Security, Inc. (Vectrix) and Area 1 Security, Inc. (Area 1), respectively. The Company recorded immaterial purchase accounting adjustments to Vectrix and Area 1 to revise purchase consideration and goodwill during the year ended December 31, 2022. For further details on these acquisitions, refer to Note 13 to these consolidated financial statements. No goodwill impairments were recorded during the years ended December 31, 2023 and 2022.

Acquired Intangible Assets, Net

Acquired intangible assets, net consisted of the following:

	December 31, 2023
	Gross Carrying Amount		Accumulated Amortization		Net Book Value
	(in thousands)
Developed technology	$	47,183	$	36,893	$	10,290
Trade name	1,700		1,488		212
Customer relationships	11,600		2,538		9,062
Total acquired intangible assets, net	$	60,483	$	40,919	$	19,564

	December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Net Book Value
	(in thousands)
Developed technology	$	40,100	$	19,191	$	20,909
Trade name	1,700		638		1,062
Customer relationships	11,600		1,088		10,512
Total acquired intangible assets, net	$	53,400	$	20,917	$	32,483

During the three months ended December 31, 2023, the Company acquired developed technology of $7.1 million for a combination of cash payments of $6.1 million and cash holdback of $1.0 million, which the Company is retaining for up to 12 months and will be payable to the seller, subject to offset by the Company for any of the seller’s indemnification obligations in connection with the asset acquisition.

Amortization of acquired intangible assets for the years ended December 31, 2023, 2022, and 2021 was $20.0 million, $15.2 million, and $2.9 million, respectively.

As of December 31, 2023, the estimated future amortization expense of acquired intangible assets was as follows:

	Estimated Amortization
	(in thousands)
Year ending December 31,
2024	$	9,010
2025	4,391
2026	1,450
2027	1,450
2028	1,450
Thereafter	1,813
Total	$	19,564