0001564590-20-051533.txt : 20201106 0001564590-20-051533.hdr.sgml : 20201106 20201105182008 ACCESSION NUMBER: 0001564590-20-051533 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 60 CONFORMED PERIOD OF REPORT: 20200930 FILED AS OF DATE: 20201106 DATE AS OF CHANGE: 20201105 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Trade Desk, Inc. CENTRAL INDEX KEY: 0001671933 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370] IRS NUMBER: 271887399 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-37879 FILM NUMBER: 201291884 BUSINESS ADDRESS: STREET 1: 42 N. CHESTNUT STREET CITY: VENTURA STATE: CA ZIP: 93001 BUSINESS PHONE: (805) 585-3434 MAIL ADDRESS: STREET 1: 42 N. CHESTNUT STREET CITY: VENTURA STATE: CA ZIP: 93001 10-Q 1 ttd-10q_20200930.htm 10-Q ttd-10q_20200930.htm
false 2020 Q3 0001671933 --12-31 true true us-gaap:ServiceMember us-gaap:ServiceMember us-gaap:ServiceMember us-gaap:ServiceMember us-gaap:ServiceMember us-gaap:ServiceMember us-gaap:ServiceMember us-gaap:ServiceMember us-gaap:AccountingStandardsUpdate201613Member 0001671933 2020-01-01 2020-09-30 xbrli:shares 0001671933 us-gaap:CommonClassAMember 2020-10-30 0001671933 us-gaap:CommonClassBMember 2020-10-30 iso4217:USD 0001671933 2020-09-30 0001671933 2019-12-31 iso4217:USD xbrli:shares 0001671933 us-gaap:CommonClassAMember 2020-09-30 0001671933 us-gaap:CommonClassAMember 2019-12-31 0001671933 us-gaap:CommonClassBMember 2020-09-30 0001671933 us-gaap:CommonClassBMember 2019-12-31 0001671933 2020-07-01 2020-09-30 0001671933 2019-07-01 2019-09-30 0001671933 2019-01-01 2019-09-30 0001671933 us-gaap:CommonStockMember 2018-12-31 0001671933 us-gaap:AdditionalPaidInCapitalMember 2018-12-31 0001671933 us-gaap:RetainedEarningsMember 2018-12-31 0001671933 2018-12-31 0001671933 us-gaap:CommonStockMember 2019-01-01 2019-03-31 0001671933 us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-03-31 0001671933 2019-01-01 2019-03-31 0001671933 us-gaap:RetainedEarningsMember 2019-01-01 2019-03-31 0001671933 us-gaap:CommonStockMember 2019-03-31 0001671933 us-gaap:AdditionalPaidInCapitalMember 2019-03-31 0001671933 us-gaap:RetainedEarningsMember 2019-03-31 0001671933 2019-03-31 0001671933 us-gaap:CommonStockMember 2019-04-01 2019-06-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2019-04-01 2019-06-30 0001671933 2019-04-01 2019-06-30 0001671933 us-gaap:RetainedEarningsMember 2019-04-01 2019-06-30 0001671933 us-gaap:CommonStockMember 2019-06-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2019-06-30 0001671933 us-gaap:RetainedEarningsMember 2019-06-30 0001671933 2019-06-30 0001671933 us-gaap:CommonStockMember 2019-07-01 2019-09-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2019-07-01 2019-09-30 0001671933 us-gaap:RetainedEarningsMember 2019-07-01 2019-09-30 0001671933 us-gaap:CommonStockMember 2019-09-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2019-09-30 0001671933 us-gaap:RetainedEarningsMember 2019-09-30 0001671933 2019-09-30 0001671933 us-gaap:CommonStockMember 2019-12-31 0001671933 us-gaap:AdditionalPaidInCapitalMember 2019-12-31 0001671933 us-gaap:RetainedEarningsMember 2019-12-31 0001671933 us-gaap:RetainedEarningsMember srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2019-12-31 0001671933 srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember 2019-12-31 0001671933 2020-01-01 2020-03-31 0001671933 us-gaap:CommonStockMember 2020-01-01 2020-03-31 0001671933 us-gaap:AdditionalPaidInCapitalMember 2020-01-01 2020-03-31 0001671933 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-01-01 2020-03-31 0001671933 us-gaap:RetainedEarningsMember 2020-01-01 2020-03-31 0001671933 us-gaap:CommonStockMember 2020-03-31 0001671933 us-gaap:AdditionalPaidInCapitalMember 2020-03-31 0001671933 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-03-31 0001671933 us-gaap:RetainedEarningsMember 2020-03-31 0001671933 2020-03-31 0001671933 us-gaap:CommonStockMember 2020-04-01 2020-06-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2020-04-01 2020-06-30 0001671933 2020-04-01 2020-06-30 0001671933 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-04-01 2020-06-30 0001671933 us-gaap:RetainedEarningsMember 2020-04-01 2020-06-30 0001671933 us-gaap:CommonStockMember 2020-06-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2020-06-30 0001671933 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-06-30 0001671933 us-gaap:RetainedEarningsMember 2020-06-30 0001671933 2020-06-30 0001671933 us-gaap:CommonStockMember 2020-07-01 2020-09-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2020-07-01 2020-09-30 0001671933 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-07-01 2020-09-30 0001671933 us-gaap:RetainedEarningsMember 2020-07-01 2020-09-30 0001671933 us-gaap:CommonStockMember 2020-09-30 0001671933 us-gaap:AdditionalPaidInCapitalMember 2020-09-30 0001671933 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2020-09-30 0001671933 us-gaap:RetainedEarningsMember 2020-09-30 0001671933 us-gaap:AccountingStandardsUpdate201613Member 2020-09-30 ttd:Class 0001671933 us-gaap:CashMember us-gaap:AvailableforsaleSecuritiesMember 2020-09-30 0001671933 us-gaap:MoneyMarketFundsMember us-gaap:FairValueInputsLevel1Member us-gaap:AvailableforsaleSecuritiesMember 2020-09-30 0001671933 us-gaap:CommercialPaperMember us-gaap:FairValueInputsLevel2Member us-gaap:AvailableforsaleSecuritiesMember 2020-09-30 0001671933 us-gaap:FairValueInputsLevel2Member us-gaap:CorporateDebtSecuritiesMember us-gaap:AvailableforsaleSecuritiesMember 2020-09-30 0001671933 us-gaap:AvailableforsaleSecuritiesMember 2020-09-30 0001671933 us-gaap:FairValueInputsLevel2Member us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:AvailableforsaleSecuritiesMember 2020-09-30 0001671933 us-gaap:CashMember us-gaap:AvailableforsaleSecuritiesMember 2019-12-31 0001671933 us-gaap:MoneyMarketFundsMember us-gaap:FairValueInputsLevel1Member us-gaap:AvailableforsaleSecuritiesMember 2019-12-31 0001671933 us-gaap:BankTimeDepositsMember us-gaap:FairValueInputsLevel1Member us-gaap:AvailableforsaleSecuritiesMember 2019-12-31 0001671933 us-gaap:CommercialPaperMember us-gaap:FairValueInputsLevel2Member us-gaap:AvailableforsaleSecuritiesMember 2019-12-31 0001671933 us-gaap:FairValueInputsLevel2Member us-gaap:USGovernmentAgenciesDebtSecuritiesMember us-gaap:AvailableforsaleSecuritiesMember 2019-12-31 0001671933 us-gaap:AvailableforsaleSecuritiesMember 2019-12-31 0001671933 us-gaap:FairValueInputsLevel2Member us-gaap:CorporateDebtSecuritiesMember us-gaap:AvailableforsaleSecuritiesMember 2019-12-31 0001671933 ttd:SecondAmendedAndRestatedLoanAndSecurityAgreementMember 2020-09-30 xbrli:pure 0001671933 ttd:SecondAmendedAndRestatedLoanAndSecurityAgreementMember 2020-03-01 2020-03-31 0001671933 ttd:SecondAmendedAndRestatedLoanAndSecurityAgreementMember 2020-01-01 2020-09-30 0001671933 us-gaap:OperatingExpenseMember 2020-07-01 2020-09-30 0001671933 us-gaap:OperatingExpenseMember 2019-07-01 2019-09-30 0001671933 us-gaap:OperatingExpenseMember 2020-01-01 2020-09-30 0001671933 us-gaap:OperatingExpenseMember 2019-01-01 2019-09-30 0001671933 us-gaap:SellingAndMarketingExpenseMember 2020-07-01 2020-09-30 0001671933 us-gaap:SellingAndMarketingExpenseMember 2019-07-01 2019-09-30 0001671933 us-gaap:SellingAndMarketingExpenseMember 2020-01-01 2020-09-30 0001671933 us-gaap:SellingAndMarketingExpenseMember 2019-01-01 2019-09-30 0001671933 us-gaap:ResearchAndDevelopmentExpenseMember 2020-07-01 2020-09-30 0001671933 us-gaap:ResearchAndDevelopmentExpenseMember 2019-07-01 2019-09-30 0001671933 us-gaap:ResearchAndDevelopmentExpenseMember 2020-01-01 2020-09-30 0001671933 us-gaap:ResearchAndDevelopmentExpenseMember 2019-01-01 2019-09-30 0001671933 us-gaap:GeneralAndAdministrativeExpenseMember 2020-07-01 2020-09-30 0001671933 us-gaap:GeneralAndAdministrativeExpenseMember 2019-07-01 2019-09-30 0001671933 us-gaap:GeneralAndAdministrativeExpenseMember 2020-01-01 2020-09-30 0001671933 us-gaap:GeneralAndAdministrativeExpenseMember 2019-01-01 2019-09-30 0001671933 us-gaap:EmployeeStockOptionMember 2019-12-31 0001671933 us-gaap:EmployeeStockOptionMember 2020-01-01 2020-09-30 0001671933 us-gaap:EmployeeStockOptionMember 2020-09-30 0001671933 ttd:TwoThousandAndSixteenIncentiveAwardPlanMember 2020-01-01 2020-01-01 0001671933 us-gaap:EmployeeStockMember 2020-07-01 2020-09-30 0001671933 us-gaap:EmployeeStockMember 2019-07-01 2019-09-30 0001671933 us-gaap:EmployeeStockMember 2020-01-01 2020-09-30 0001671933 us-gaap:EmployeeStockMember 2019-01-01 2019-09-30 0001671933 us-gaap:EmployeeStockMember 2020-01-01 2020-01-01 0001671933 2015-01-01 2015-12-31 0001671933 2016-01-01 2016-12-31 0001671933 2017-01-01 2017-12-31 0001671933 country:US 2020-07-01 2020-09-30 0001671933 country:US 2019-07-01 2019-09-30 0001671933 country:US 2020-01-01 2020-09-30 0001671933 country:US 2019-01-01 2019-09-30 0001671933 us-gaap:NonUsMember 2020-07-01 2020-09-30 0001671933 us-gaap:NonUsMember 2019-07-01 2019-09-30 0001671933 us-gaap:NonUsMember 2020-01-01 2020-09-30 0001671933 us-gaap:NonUsMember 2019-01-01 2019-09-30 0001671933 country:US 2020-09-30 0001671933 country:US 2019-12-31 0001671933 us-gaap:NonUsMember 2020-09-30 0001671933 us-gaap:NonUsMember 2019-12-31 0001671933 us-gaap:IndemnificationGuaranteeMember 2020-09-30

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number: 001-37879

 

THE TRADE DESK, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

 

 

 

27-1887399

(State or other jurisdiction of

incorporation or organization)

 

 

 

(I.R.S. Employer

Identification No.)

42 N. Chestnut Street

Ventura, California 93001

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (805) 585-3434

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading Symbol

 

Name of each exchange on which registered

Class A Common Stock, par value $0.000001 per share

 

TTD

 

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

  

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

☐  

  

Smaller reporting company

 

 

 

 

 

 

 

 

  

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

As of October 30, 2020, the registrant had 41,948,956 shares of Class A common stock and 5,015,339 shares of Class B common stock outstanding.

 

 


THE TRADE DESK, INC.

QUARTERLY REPORT ON FORM 10-Q

INDEX

 

 

  

 

Page

Part I.

  

FINANCIAL INFORMATION

 

3

Item 1.

  

Condensed Consolidated Financial Statements (Unaudited)

 

3

 

  

Condensed Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019

 

3

 

  

Condensed Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2020 and 2019

 

4

 

 

Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2020 and 2019

 

5

 

 

Condensed Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended September 30, 2020 and 2019

 

6

 

 

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2020 and 2019

 

7

 

  

Notes to Condensed Consolidated Financial Statements

 

8

Item 2.

  

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

15

Item 3.

  

Quantitative and Qualitative Disclosures About Market Risk

 

23

Item 4.

  

Controls and Procedures

 

23

Part II.

  

OTHER INFORMATION

 

24

Item 1.

  

Legal Proceedings

 

24

Item 1A.

  

Risk Factors

 

24

Item 6.

  

Exhibits

 

46

Signatures

 

47

 


PART I. FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

THE TRADE DESK, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par values)

(Unaudited)

 

 

 

As of

 

 

As of

 

 

 

September 30,

2020

 

 

December 31,

2019

 

ASSETS

 

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

434,371

 

 

$

130,876

 

Short-term investments, net of allowance for credit losses

   of $11 and $0 as of September 30, 2020 and December 31, 2019, respectively

 

 

122,909

 

 

 

124,112

 

Accounts receivable, net of allowance for credit losses

   of $7,182 and $3,920 as of September 30, 2020 and December 31, 2019, respectively

 

 

1,139,860

 

 

 

1,166,376

 

Prepaid expenses and other current assets

 

 

58,847

 

 

 

27,857

 

TOTAL CURRENT ASSETS

 

 

1,755,987

 

 

 

1,449,221

 

Property and equipment, net

 

 

111,862

 

 

 

64,012

 

Operating lease assets

 

 

202,172

 

 

 

173,449

 

Deferred income taxes

 

 

39,928

 

 

 

18,950

 

Other assets, non-current

 

 

28,479

 

 

 

23,129

 

TOTAL ASSETS

 

$

2,138,428

 

 

$

1,728,761

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

 

Accounts payable

 

$

919,694

 

 

$

868,618

 

Accrued expenses and other current liabilities

 

 

57,724

 

 

 

47,178

 

Operating lease liabilities

 

 

34,735

 

 

 

14,577

 

TOTAL CURRENT LIABILITIES

 

 

1,012,153

 

 

 

930,373

 

Operating lease liabilities, non-current

 

 

205,408

 

 

 

174,873

 

Debt, net

 

 

72,000

 

 

 

 

Other liabilities, non-current

 

 

16,240

 

 

 

10,998

 

TOTAL LIABILITIES

 

 

1,305,801

 

 

 

1,116,244

 

Commitments and contingencies (Note 10)

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Preferred stock, par value $0.000001; 100,000 shares authorized, zero shares issued

   and outstanding as of September 30, 2020 and December 31, 2019

 

 

 

 

 

 

Common stock, par value $0.000001

   Class A, 1,000,000 shares authorized; 41,930 and 40,305 shares issued and outstanding

      as of September 30, 2020 and December 31, 2019, respectively

   Class B, 95,000 shares authorized; 5,015 and 5,171 shares issued and outstanding

      as of September 30, 2020 and December 31, 2019, respectively

 

 

 

 

 

 

Additional paid-in capital

 

 

510,017

 

 

 

380,079

 

Accumulated other comprehensive income

 

 

145

 

 

 

 

Retained earnings

 

 

322,465

 

 

 

232,438

 

TOTAL STOCKHOLDERS’ EQUITY

 

 

832,627

 

 

 

612,517

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

2,138,428

 

 

$

1,728,761

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

3


THE TRADE DESK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

(Unaudited)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Revenue

 

$

216,113

 

 

$

164,203

 

 

$

516,128

 

 

$

445,114

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Platform operations

 

 

44,826

 

 

 

39,932

 

 

 

127,167

 

 

 

108,913

 

Sales and marketing

 

 

44,637

 

 

 

36,142

 

 

 

116,002

 

 

 

89,951

 

Technology and development

 

 

41,079

 

 

 

29,185

 

 

 

117,931

 

 

 

83,949

 

General and administrative

 

 

42,789

 

 

 

37,017

 

 

 

117,252

 

 

 

102,755

 

Total operating expenses

 

 

173,331

 

 

 

142,276

 

 

 

478,352

 

 

 

385,568

 

Income from operations

 

 

42,782

 

 

 

21,927

 

 

 

37,776

 

 

 

59,546

 

Other expense (income):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense (income), net

 

 

235

 

 

 

(1,480

)

 

 

(740

)

 

 

(3,763

)

Foreign currency exchange (gain) loss, net

 

 

(12

)

 

 

(412

)

 

 

1,574

 

 

 

784

 

Total other expense (income), net

 

 

223

 

 

 

(1,892

)

 

 

834

 

 

 

(2,979

)

Income before income taxes

 

 

42,559

 

 

 

23,819

 

 

 

36,942

 

 

 

62,525

 

Provision for (benefit from) income taxes

 

 

1,312

 

 

 

4,397

 

 

 

(53,473

)

 

 

5,152

 

Net income

 

$

41,247

 

 

$

19,422

 

 

$

90,415

 

 

$

57,373

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.89

 

 

$

0.43

 

 

$

1.96

 

 

$

1.29

 

Diluted

 

$

0.84

 

 

$

0.40

 

 

$

1.86

 

 

$

1.20

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

46,582

 

 

 

44,771

 

 

 

46,075

 

 

 

44,363

 

Diluted

 

 

49,220

 

 

 

48,037

 

 

 

48,731

 

 

 

47,728

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

4


THE TRADE DESK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Net income

 

$

41,247

 

 

$

19,422

 

 

$

90,415

 

 

$

57,373

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in unrealized (loss) gain on available-for-sale investments, net of tax

 

 

(129

)

 

 

 

 

 

145

 

 

 

 

Comprehensive income

 

$

41,118

 

 

$

19,422

 

 

$

90,560

 

 

$

57,373

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

5


THE TRADE DESK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)

 

 

 

Class A and B

 

 

Additional

 

 

Accumulated

Other

 

 

 

 

 

 

Total

 

 

 

Common Stock

 

 

Paid-In

 

 

Comprehensive

 

 

Retained

 

 

Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income

 

 

Earnings

 

 

Equity

 

Balance as of December 31, 2018

 

 

43,864

 

 

$

 

 

$

270,447

 

 

$

 

 

$

124,120

 

 

$

394,567

 

Exercise of common stock options

 

 

592

 

 

 

 

 

 

9,502

 

 

 

 

 

 

 

 

 

9,502

 

Restricted stock, net of forfeitures and shares

    withheld for taxes

 

 

23

 

 

 

 

 

 

(1,146

)

 

 

 

 

 

 

 

 

(1,146

)

Stock-based compensation

 

 

 

 

 

 

 

 

16,324

 

 

 

 

 

 

 

 

 

16,324

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

10,151

 

 

 

10,151

 

Balance as of March 31, 2019

 

 

44,479

 

 

$

 

 

$

295,127

 

 

$

 

 

$

134,271

 

 

$

429,398

 

Exercise of common stock options

 

 

284

 

 

 

 

 

 

7,473

 

 

 

 

 

 

 

 

 

7,473

 

Restricted stock, net of forfeitures and shares

    withheld for taxes

 

 

7

 

 

 

 

 

 

(2,488

)

 

 

 

 

 

 

 

 

(2,488

)

Stock-based compensation

 

 

 

 

 

 

 

 

21,390

 

 

 

 

 

 

 

 

 

21,390

 

Issuance of common stock under employee

   stock purchase plan

 

 

153

 

 

 

 

 

 

8,648

 

 

 

 

 

 

 

 

 

8,648

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

27,800

 

 

 

27,800

 

Balance as of June 30, 2019

 

 

44,923

 

 

$

 

 

$

330,150

 

 

$

 

 

$

162,071

 

 

$

492,221

 

Exercise of common stock options

 

 

196

 

 

 

 

 

 

4,936

 

 

 

 

 

 

 

 

 

4,936

 

Restricted stock, net of forfeitures and shares

    withheld for taxes

 

 

2

 

 

 

 

 

 

(1,110

)

 

 

 

 

 

 

 

 

(1,110

)

Stock-based compensation

 

 

 

 

 

 

 

 

19,923

 

 

 

 

 

 

 

 

 

19,923

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

19,422

 

 

 

19,422

 

Balance as of September 30, 2019

 

 

45,121

 

 

$

 

 

$

353,899

 

 

$

 

 

$

181,493

 

 

$

535,392

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of December 31, 2019

 

 

45,476

 

 

$

 

 

$

380,079

 

 

$

 

 

$

232,438

 

 

$

612,517

 

Impact upon adoption of new accounting

    standard (Note 2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(388

)

 

 

(388

)

Exercise of common stock options

 

 

539

 

 

 

 

 

 

19,320

 

 

 

 

 

 

 

 

 

19,320

 

Restricted stock, net of forfeitures and shares

    withheld for taxes

 

 

20

 

 

 

 

 

 

(4,893

)

 

 

 

 

 

 

 

 

(4,893

)

Stock-based compensation

 

 

 

 

 

 

 

 

23,263

 

 

 

 

 

 

 

 

 

23,263

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

158

 

 

 

 

 

 

158

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

24,057

 

 

 

24,057

 

Balance as of March 31, 2020

 

 

46,035

 

 

$

 

 

$

417,769

 

 

$

158

 

 

$

256,107

 

 

$

674,034

 

Exercise of common stock options

 

 

431

 

 

 

 

 

 

22,375

 

 

 

 

 

 

 

 

 

22,375

 

Restricted stock, net of forfeitures and shares

    withheld for taxes

 

 

61

 

 

 

 

 

 

(2,836

)

 

 

 

 

 

 

 

 

(2,836

)

Stock-based compensation

 

 

 

 

 

 

 

 

24,516

 

 

 

 

 

 

 

 

 

24,516

 

Issuance of common stock under employee

   stock purchase plan

 

 

202

 

 

 

 

 

 

15,035

 

 

 

 

 

 

 

 

 

15,035

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

116

 

 

 

 

 

 

116

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

25,111

 

 

 

25,111

 

Balance as of June 30, 2020

 

 

46,729

 

 

$

 

 

$

476,859

 

 

$

274

 

 

$

281,218

 

 

$

758,351

 

Exercise of common stock options

 

 

224

 

 

 

 

 

 

12,247

 

 

 

 

 

 

 

 

 

12,247

 

Restricted stock, net of forfeitures and shares

    withheld for taxes

 

 

(8

)

 

 

 

 

 

(6,455

)

 

 

 

 

 

 

 

 

(6,455

)

Stock-based compensation

 

 

 

 

 

 

 

 

27,366

 

 

 

 

 

 

 

 

 

27,366

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

 

 

 

(129

)

 

 

 

 

 

(129

)

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

41,247

 

 

 

41,247

 

Balance as of September 30, 2020

 

 

46,945

 

 

$

 

 

$

510,017

 

 

$

145

 

 

$

322,465

 

 

$

832,627

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

6


THE TRADE DESK, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

 

Nine Months Ended September 30,

 

 

 

2020

 

 

2019

 

OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net income

 

$

90,415

 

 

$

57,373

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

20,777

 

 

 

15,246

 

Stock-based compensation

 

 

73,751

 

 

 

56,368

 

Allowance for credit losses on accounts receivable

 

 

2,722

 

 

 

1,647

 

Noncash lease expense

 

 

24,052

 

 

 

15,394

 

Deferred income taxes

 

 

(20,978

)

 

 

 

Other

 

 

1,242

 

 

 

(2,945

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

21,063

 

 

 

(2,739

)

Prepaid expenses and other assets

 

 

(23,919

)

 

 

(19,024

)

Accounts payable

 

 

47,728

 

 

 

(21,401

)

Accrued expenses and other liabilities

 

 

11,006

 

 

 

(3,178

)

Operating lease liabilities

 

 

(10,388

)

 

 

(8,468

)

Net cash provided by operating activities

 

 

237,471

 

 

 

88,273

 

INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Purchases of investments

 

 

(127,117

)

 

 

(178,179

)

Maturities of investments

 

 

128,315

 

 

 

55,819

 

Purchases of property and equipment

 

 

(57,721

)

 

 

(21,659

)

Capitalized software development costs