Acquisitions, Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Schedule of Purchase Price Allocation

The following table sets forth the final allocation of the purchase price and summarizes the fair values of the assets acquired and liabilities assumed at the Paperspace Acquisition Date:

	Amount
Fair value of consideration transferred
Cash consideration	$	100,399
Recognized amounts of identifiable assets acquired and liabilities assumed
Tangible assets acquired:
Cash and cash equivalents	$	1,376
Accounts receivable	1,042
Prepaid expenses and other current assets	4
Property and equipment, net	4,515
Operating right-of-use asset, net	4,398
Finance lease right-of-use asset, net	11,958
Other assets	367
Intangible assets	37,690
Liabilities assumed:
Accounts payable and accrued expenses	(1,608)
Deferred revenue	(105)
Operating lease liabilities, current	(1,475)
Operating lease liabilities, non-current	(2,923)
Finance lease liabilities, current	(5,707)
Finance lease liabilities, non-current	(6,251)
Deferred tax liabilities	(1,074)
Total identifiable net assets acquired	42,207
Goodwill recorded in acquisition	58,192
Total purchase price allocation	$	100,399

The following table sets forth the components and the allocation of the purchase price for the business combination and summarizes the fair values of the assets acquired and liabilities assumed at the Cloudways Acquisition Date:

	Amount
Fair value of consideration transferred
Cash paid to Cloudways sellers	$	278,187
Cash contributed to escrow accounts	42,000
Other expenses	150
Less: Cash pre-funded from contingent compensation	(9,100)
Total consideration paid	$	311,237
Recognized amounts of identifiable assets acquired and liabilities assumed
Tangible assets acquired:
Cash and cash equivalents	$	5,827
Accounts receivable	4,753
Prepaid expenses and other current assets	547
Other assets	9
Intangible assets	72,000
Liabilities assumed:
Accounts payable	(1,820)
Accrued expenses	(957)
Deferred revenue	(1,013)
Deferred tax liabilities	(3,417)
Other current liabilities	(23,243)
Total identifiable net assets acquired	52,686
Goodwill recorded in acquisition	258,551
Total purchase price allocation	$	311,237

Schedule of Intangible Assets Acquired

The fair values allocated to the identifiable intangible assets and their estimated useful lives are as follows:

	Estimated Fair Value		Weighted Average Useful Life (In years)
Trademark/Trade Name	$	300	1
Developed Technology	24,120		5
Customer Relationships	13,270		5
Total intangible assets	$	37,690

The Company amortizes its intangible assets assuming no residual value over periods in which the economic benefit of these assets is consumed (the useful life). The fair values allocated to the identifiable intangible assets and their estimated useful lives are as follows:

	Estimated Fair Value		Weighted Average Useful Life  (In years)
Trade name	$	9,500	10
Developed technology	31,500		5
Customer relationships	31,000		7
Total intangible assets	$	72,000

Schedule of Pro Forma Information

The unaudited pro forma information below summarizes the combined results of the Company and Paperspace as if the Company’s acquisition of Paperspace closed on January 1, 2022 but does not necessarily reflect the combined actual results of operations of the Company and Paperspace that would have been achieved, nor are they necessarily indicative of future results of operations. The unaudited pro forma information reflects certain adjustments that were directly attributable to the acquisition of Paperspace, including additional amortization of acquired assets and the timing of nonrecurring acquisition and integration related costs, and other adjustments the Company believes are reasonable for the pro forma presentation. If Paperspace had been acquired on January 1, 2022, and included in the Company’s results in 2022 and 2023, it would not have had a material impact to revenue.

	Year Ended December 31,
	2023		2022
Net loss	$	(280)	$	(61,802)

The unaudited pro forma information below summarizes the combined results of the Company and Cloudways as if the Company’s acquisition of Cloudways closed on January 1, 2021 but does not necessarily reflect the combined actual results of operations of the Company and Cloudways that would have been achieved, nor are they necessarily indicative of future results of operations. The unaudited pro forma information reflects certain adjustments that were directly attributable to the acquisition of Cloudways, including additional amortization adjustments for the fair value of the assets acquired and liabilities assumed and other adjustments the Company believes are reasonable for the pro forma presentation. The pro forma net loss for the year ended December 31, 2022 was adjusted to exclude nonrecurring acquisition-related costs of $2,139.

	Year Ended December 31,
	2022
Revenue	$	607,191
Net loss	(20,780)

Schedule of Goodwill

Movements in goodwill during the years ended December 31, 2024 and 2023 were as follows:

Balance at January 1, 2023	$	315,168
Acquisition of Paperspace	57,840
Measurement period adjustments(1)	(24,686)
Balance at December 31, 2023	348,322
Measurement period adjustments(2)	352
Balance at December 31, 2024	$	348,674

___________________

(1)The Company finalized and adjusted the purchase price for the Cloudways acquisition as discussed above.

(2)The Company finalized and adjusted the purchase price of the Paperspace acquisition as discussed above.

Schedule of Intangible Assets and Goodwill

Intangible assets, net consisted of the following amounts:

	December 31,
	2024		2023
Asset Type
IP addresses	$	44,822	$	44,821
Developed technology	62,323		62,330
Customer relationships	44,270		44,270
Trade name	9,800		9,800
Content	4,400		4,400
Brand	1,000		1,000
Total carrying value	$	166,615	$	166,621
Accumulated Amortization
Developed technology	$	(27,094)	$	(14,737)
Customer relationships	(14,286)		(7,203)
Trade name	(2,517)		(1,413)
Content	(4,000)		(2,534)
Brand	(1,000)		(583)
Total accumulated amortization	(48,897)		(26,470)
Total intangible assets, net	$	117,718	$	140,151

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

Amortization expense for the next five years and

thereafter, based on valuations and determinations of useful lives, is expected to be as follows:

2025	$	20,049
2026	19,657
2027	17,557
2028	9,198
2029	3,902
Thereafter	2,533
Total estimated future intangible amortization expense	$	72,896