QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(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 each exchange on which registered | ||||||
x | Accelerated filer | o | |||||||||
Non-accelerated filer | o | Smaller reporting company | |||||||||
Emerging growth company |
March 31, 2023 | December 31, 2022 | ||||||||||
Assets | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Restricted cash | |||||||||||
Accounts receivable, net | |||||||||||
Inventory | |||||||||||
Prepaid expenses and other current assets (Note 12) | |||||||||||
Total current assets | |||||||||||
Noncurrent assets | |||||||||||
Goodwill (Note 4) | |||||||||||
Residual commission buyouts, net (Note 6) | |||||||||||
Other intangible assets, net (Note 7) | |||||||||||
Capitalized customer acquisition costs, net (Note 8) | |||||||||||
Equipment for lease, net (Note 9) | |||||||||||
Property, plant and equipment, net (Note 10) | |||||||||||
Right-of-use assets (Note 15) | |||||||||||
Investments in securities | |||||||||||
Other noncurrent assets | |||||||||||
Total noncurrent assets | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities and Stockholders' Equity | |||||||||||
Current liabilities | |||||||||||
Accounts payable | $ | $ | |||||||||
Accrued expenses and other current liabilities (Note 12) | |||||||||||
Deferred revenue (Note 3) | |||||||||||
Current lease liabilities (Note 15) | |||||||||||
Total current liabilities | |||||||||||
Noncurrent liabilities | |||||||||||
Long-term debt (Note 11) | |||||||||||
Deferred tax liability (Note 14) | |||||||||||
Noncurrent lease liabilities (Note 15) | |||||||||||
Other noncurrent liabilities (Note 12) | |||||||||||
Total noncurrent liabilities | |||||||||||
Total liabilities | |||||||||||
Commitments and contingencies (Note 17) | |||||||||||
Stockholders' equity (Note 18) | |||||||||||
Preferred stock, $ | |||||||||||
Class A common stock, $ | |||||||||||
Class B common stock, $ | |||||||||||
Class C common stock, $ | |||||||||||
Additional paid-in capital | |||||||||||
Accumulated other comprehensive income | |||||||||||
Retained deficit | ( | ( | |||||||||
Total stockholders' equity attributable to Shift4 Payments, Inc. | |||||||||||
Noncontrolling interests (Note 19) | |||||||||||
Total stockholders' equity | |||||||||||
Total liabilities and stockholders' equity | $ | $ | |||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Gross revenue | $ | $ | |||||||||
Cost of sales (exclusive of certain depreciation and amortization expense shown separately below) | ( | ( | |||||||||
General and administrative expenses | ( | ( | |||||||||
Revaluation of contingent liabilities (Note 13) | ( | ||||||||||
Depreciation and amortization expense (Note 5) (a) | ( | ( | |||||||||
Professional fees | ( | ( | |||||||||
Advertising and marketing expenses | ( | ( | |||||||||
Income (loss) from operations | ( | ||||||||||
Interest income | |||||||||||
Other income, net | |||||||||||
Unrealized gain on investments in securities (Note 13) | |||||||||||
Change in TRA liability (Note 14) | ( | ||||||||||
Interest expense | ( | ( | |||||||||
Income (loss) before income taxes | ( | ||||||||||
Income tax benefit (Note 14) | |||||||||||
Net income (loss) | ( | ||||||||||
Net income (loss) attributable to noncontrolling interests | ( | ||||||||||
Net income (loss) attributable to Shift4 Payments, Inc. | $ | $ | ( | ||||||||
Basic net income (loss) per share (Note 21) | |||||||||||
Class A net income (loss) per share - basic | $ | $ | ( | ||||||||
Class A weighted average common stock outstanding - basic | |||||||||||
Class C net income (loss) per share - basic | $ | $ | ( | ||||||||
Class C weighted average common stock outstanding - basic | |||||||||||
Diluted net income (loss) per share (Note 21) | |||||||||||
Class A net income (loss) per share - diluted | $ | $ | ( | ||||||||
Class A weighted average common stock outstanding - diluted | |||||||||||
Class C net income (loss) per share - diluted | $ | $ | ( | ||||||||
Class C weighted average common stock outstanding - diluted | |||||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Net income (loss) | $ | $ | ( | ||||||||
Other comprehensive income | |||||||||||
Unrealized gain on foreign currency translation adjustment, net of tax | |||||||||||
Total other comprehensive income | |||||||||||
Comprehensive income (loss) | ( | ||||||||||
Comprehensive income (loss) attributable to noncontrolling interests | ( | ||||||||||
Comprehensive income (loss) attributable to Shift4 Payments, Inc. | $ | $ | ( | ||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Class A Common Stock | Class B Common Stock | Class C Common Stock | Additional Paid-In Capital | Retained Deficit | Accumulated Other Comprehensive Income | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2022 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock in connection with acquisitions and residual commission buyouts | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of shares held by Rook | — | ( | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Distributions to noncontrolling interests | — | — | — | — | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of tax withholding | — | — | — | — | — | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at March 31, 2023 | $ | $ | $ | $ | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Class A Common Stock | Class B Common Stock | Class C Common Stock | Additional Paid-In Capital | Treasury Stock | Retained Deficit | Noncontrolling Interests | Total Equity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2021 | $ | $ | $ | $ | ( | ( | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock and fair value of equity-based compensation awards assumed in connection with The Giving Block acquisition | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchases of Class A common stock to treasury stock | — | — | — | — | — | — | ( | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of shares held by Continuing Equity Owners | — | — | — | ( | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of tax withholding | — | — | — | — | — | ( | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at March 31, 2022 | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Operating activities | |||||||||||
Net income (loss) | $ | $ | ( | ||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | |||||||||||
Depreciation and amortization | |||||||||||
Amortization of capitalized financing costs | |||||||||||
Deferred income taxes | ( | ( | |||||||||
Provision for bad debts | |||||||||||
Revaluation of contingent liabilities | |||||||||||
Unrealized gain on investments in securities | ( | ||||||||||
Change in TRA liability | |||||||||||
Equity-based compensation expense | |||||||||||
Other noncash items | |||||||||||
Change in operating assets and liabilities | |||||||||||
Accounts receivable | ( | ( | |||||||||
Prepaid expenses and other assets | |||||||||||
Inventory | |||||||||||
Capitalized customer acquisition costs | ( | ( | |||||||||
Accounts payable | |||||||||||
Accrued expenses and other current liabilities | |||||||||||
Right-of-use assets and lease liabilities, net | ( | ||||||||||
Deferred revenue | |||||||||||
Net cash provided by operating activities | |||||||||||
Investing activities | |||||||||||
Residual commission buyouts | ( | ( | |||||||||
Acquisitions, net of cash acquired | ( | ( | |||||||||
Acquisition of equipment to be leased | ( | ( | |||||||||
Capitalized software development costs | ( | ( | |||||||||
Acquisition of property, plant and equipment | ( | ( | |||||||||
Investments in securities | ( | ||||||||||
Net cash used in investing activities | ( | ( | |||||||||
Financing activities | |||||||||||
Repurchases of Class A common stock to treasury stock | ( | ||||||||||
Payments for withholding tax related to vesting of restricted stock units | ( | ( | |||||||||
Deferred financing costs | ( | ||||||||||
Distributions to noncontrolling interests | ( | ||||||||||
Payments on contingent liabilities | ( | ||||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash and cash equivalents and restricted cash | |||||||||||
Change in cash and cash equivalents and restricted cash | ( | ||||||||||
Cash and cash equivalents and restricted cash | |||||||||||
Beginning of period | |||||||||||
End of period | $ | $ | |||||||||
Supplemental cash flows information and noncash activities are further described in Note 22. | |||||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Cash | $ | ||||
Shares of Class A common stock (a) | |||||
Contingent consideration (b) | |||||
Shareholder loans transfer | |||||
Total purchase consideration | |||||
Less: cash acquired | ( | ||||
Total purchase consideration, net of cash acquired | $ | ||||
(a) Total purchase consideration includes | |||||
(b) The Company agreed to an earnout due to the former shareholders of Online Payments Group, not to exceed $ |
Accounts receivable | $ | ||||
Shareholder loans receivable (a) | |||||
Goodwill (b) | |||||
Other intangible assets | |||||
Indemnification asset (c) | |||||
Accounts payable | ( | ||||
Accrued expenses and other current liabilities | ( | ||||
Uncertain tax position (d) | ( | ||||
Deferred tax liability | ( | ||||
Other noncurrent liabilities | ( | ||||
Net assets acquired | $ | ||||
(a) Amount is eliminated in consolidation and therefore has no impact to the Company’s unaudited Condensed Consolidated Balance Sheets. | |||||
(b) Goodwill is not deductible for tax purposes. | |||||
(c) Included within “Other noncurrent assets” in the Company’s unaudited Condensed Consolidated Balance Sheets. | |||||
(d) Included within “Other noncurrent liabilities” in the Company’s unaudited Condensed Consolidated Balance Sheets. |
Cash | $ | ||||
Shares of Class A common stock (a) | |||||
Contingent consideration (b)(c) | |||||
Settlement of preexisting relationship | ( | ||||
Total purchase consideration | |||||
Less: cash acquired | ( | ||||
Total purchase consideration, net of cash acquired | $ | ||||
(a) Total purchase consideration includes | |||||
(b) The Company agreed to earnouts due to certain former shareholders of the restaurant technology partners acquired in 2022, calculated as a multiple of the number of each partners’ merchants that are converted to the Company’s end-to-end payments platform during the | |||||
(c) The Company agreed to an earnout due to certain former shareholders of the restaurant technology partner acquired in 2023, calculated as a multiple of the number of the restaurant technology partner’s merchants that are converted to the Company’s end-to-end payments platform during the 24 months following September 1, 2022, not to exceed $ |
Accounts receivable | $ | ||||
Inventory | |||||
Prepaid expenses and other current assets | |||||
Goodwill (a) | |||||
Residual commission buyouts | |||||
Other intangible assets | |||||
Property, plant and equipment | |||||
Right-of-use assets | |||||
Accounts payable | ( | ||||
Accrued expenses and other current liabilities | ( | ||||
Deferred revenue | ( | ||||
Current lease liabilities | ( | ||||
Deferred tax liability | ( | ||||
Noncurrent lease liabilities | ( | ||||
Net assets acquired | $ | ||||
(a) $ |
Cash | $ | ||||
Shares of Class A common stock (a) | |||||
RSUs granted for fair value of equity-based compensation awards (b) | |||||
Contingent consideration (c) | |||||
Total purchase consideration | |||||
Less: cash acquired | ( | ||||
Total purchase consideration, net of cash acquired | $ | ||||
(a) Total purchase consideration includes | |||||
(b) The Company assumed all equity awards held by continuing employees. The portion of the fair value of the equity-based compensation awards associated with prior service of The Giving Block employees represents a component of the total consideration as presented above and was valued based on the fair value of The Giving Block awards on February 28, 2022, the acquisition date. | |||||
(c) The Company agreed to an earnout due to the former shareholders of The Giving Block, calculated as a multiple of revenue earned by The Giving Block from March 1, 2022 to February 28, 2023, not to exceed $ |
Prepaid expenses and other current assets (a) | $ | ||||
Goodwill (b) | |||||
Other intangible assets | |||||
Accrued expenses and other current liabilities (a) | ( | ||||
Deferred revenue | ( | ||||
Deferred tax liability | ( | ||||
Net assets acquired | $ | ||||
(a) Includes $ | |||||
(b) Goodwill is not deductible for tax purposes. |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Payments-based revenue | $ | $ | |||||||||
Subscription and other revenues | |||||||||||
Total | $ | $ |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Over-time revenue | $ | $ | |||||||||
Point-in-time revenue | |||||||||||
Total | $ | $ |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Annual service fees and regulatory compliance fees | $ | $ | |||||||||
Amount of these fees included in deferred revenue at beginning of period |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Beginning balance | $ | $ | |||||||||
Additions to expense | |||||||||||
Write-offs, net of recoveries and other adjustments | ( | ( | |||||||||
Ending balance | $ | $ |
Balance at December 31, 2022 | $ | ||||
Restaurant technology partner acquisition (Note 2) | |||||
Purchase price adjustments related to prior period acquisitions | ( | ||||
Effect of foreign currency translation | |||||
Balance at March 31, 2023 | $ |
Amortization | Depreciation | |||||||||||||||||||||||||||||||||||||
Residual Commission Buyouts (Note 6) | Other Intangible Assets (Note 7) | Capitalized Customer Acquisition Costs (Note 8) | Equipment Under Lease (Note 9) | Property, Plant and Equipment (Note 10) | Total | |||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2023 | ||||||||||||||||||||||||||||||||||||||
Depreciation and amortization expense | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Cost of sales | ||||||||||||||||||||||||||||||||||||||
Total depreciation and amortization (a) | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Three Months Ended March 31, 2022 | ||||||||||||||||||||||||||||||||||||||
Depreciation and amortization expense | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||
Cost of sales | ||||||||||||||||||||||||||||||||||||||
Total depreciation and amortization (b) | $ | $ | $ | $ | $ | $ |
Residual Commission Buyouts | Other Intangible Assets | Capitalized Customer Acquisition Costs | Total Amortization | ||||||||||||||||||||
2023 (remaining nine months) | $ | $ | $ | $ | |||||||||||||||||||
2024 | |||||||||||||||||||||||
2025 | |||||||||||||||||||||||
2026 | |||||||||||||||||||||||
2027 | |||||||||||||||||||||||
Thereafter | |||||||||||||||||||||||
Total | $ | $ | $ | $ |
Weighted Average Amortization Period (in years) | March 31, 2023 | |||||||||||||||||||||||||
Carrying Value | Accumulated Amortization | Net Carrying Value | ||||||||||||||||||||||||
Residual commission buyouts from asset acquisitions | $ | $ | ( | $ | ||||||||||||||||||||||
Residual commission buyouts from business combinations | ( | |||||||||||||||||||||||||
Total residual commission buyouts | $ | $ | ( | $ | ||||||||||||||||||||||
Weighted Average Amortization Period (in years) | December 31, 2022 | |||||||||||||||||||||||||
Carrying Value | Accumulated Amortization | Net Carrying Value | ||||||||||||||||||||||||
Residual commission buyouts from asset acquisitions | $ | $ | ( | $ | ||||||||||||||||||||||
Residual commission buyouts from business combinations | ( | |||||||||||||||||||||||||
Total residual commission buyouts | $ | $ | ( | $ |
Weighted Average Amortization Period (in years) | March 31, 2023 | ||||||||||||||||||||||
Carrying Value | Accumulated Amortization | Net Carrying Value | |||||||||||||||||||||
Merchant relationships | $ | $ | ( | $ | |||||||||||||||||||
Acquired technology | ( | ||||||||||||||||||||||
Trademarks and trade names | ( | ||||||||||||||||||||||
Capitalized software development costs | ( | ||||||||||||||||||||||
Total other intangible assets, net | $ | $ | ( | $ |
Weighted Average Amortization Period (in years) | December 31, 2022 | ||||||||||||||||||||||
Carrying Value | Accumulated Amortization | Net Carrying Value | |||||||||||||||||||||
Merchant relationships | $ | $ | ( | $ | |||||||||||||||||||
Acquired technology | ( | ||||||||||||||||||||||
Trademarks and trade names | ( | ||||||||||||||||||||||
Capitalized software development costs | ( | ||||||||||||||||||||||
Total other intangible assets, net | $ | $ | ( | $ |
Weighted Average Depreciation Period (in years) | March 31, 2023 | ||||||||||||||||||||||
Carrying Value | Accumulated Depreciation | Net Carrying Value | |||||||||||||||||||||
Equipment under lease | $ | $ | ( | $ | |||||||||||||||||||
Equipment held for lease (a) | N/A | ||||||||||||||||||||||
Total equipment for lease | $ | $ | ( | $ |
Weighted Average Depreciation Period (in years) | December 31, 2022 | ||||||||||||||||||||||
Carrying Value | Accumulated Depreciation | Net Carrying Value | |||||||||||||||||||||
Equipment under lease | $ | $ | ( | $ | |||||||||||||||||||
Equipment held for lease (a) | N/A | ||||||||||||||||||||||
Total equipment for lease, net | $ | $ | ( | $ | |||||||||||||||||||
(a) Represents equipment that was not yet initially deployed to a merchant and, accordingly, is not being depreciated. |
March 31, 2023 | December 31, 2022 | ||||||||||
Equipment | $ | $ | |||||||||
Capitalized software | |||||||||||
Leasehold improvements | |||||||||||
Furniture and fixtures | |||||||||||
Vehicles | |||||||||||
Total property, plant and equipment, gross | |||||||||||
Less: Accumulated depreciation | ( | ( | |||||||||
Total property, plant and equipment, net | $ | $ |
Maturity | Effective Interest Rate | March 31, 2023 | December 31, 2022 | |||||||||||||||||||||||
Convertible Notes due 2025 (2025 Convertible Notes) | December 15, 2025 | $ | $ | |||||||||||||||||||||||
Convertible Notes due 2027 (2027 Convertible Notes) | August 1, 2027 | |||||||||||||||||||||||||
Senior Notes due 2026 (2026 Senior Notes) | November 1, 2026 | |||||||||||||||||||||||||
Total borrowings | ||||||||||||||||||||||||||
Less: Unamortized capitalized financing fees | ( | ( | ||||||||||||||||||||||||
Total long-term debt | $ | $ |
2025 | $ | |||||||
2026 | ||||||||
2027 | ||||||||
Total | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Principal outstanding | $ | $ | |||||||||
Unamortized debt issuance costs | ( | ( | |||||||||
Net carrying value | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Principal outstanding | $ | $ | |||||||||
Unamortized debt issuance costs | ( | ( | |||||||||
Net carrying value | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Principal outstanding | $ | $ | |||||||||
Unamortized debt issuance costs | ( | ( | |||||||||
Net carrying value | $ | $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Prepaid insurance | $ | $ | |||||||||
Taxes receivable | |||||||||||
Crypto settlement assets | |||||||||||
Other prepaid expenses (a) | |||||||||||
Other current assets (b) | |||||||||||
Total prepaid expenses and other current assets | $ | $ | |||||||||
(a) Includes prepayments related to information technology, rent, tradeshows and conferences. | |||||||||||
(b) Includes $ |
March 31, 2023 | December 31, 2022 | ||||||||||
Contingent liability earnouts for acquisitions (a) | $ | $ | |||||||||
Contingent liability earnouts for residual commission buyouts | |||||||||||
Residuals payable | |||||||||||
Accrued interest | |||||||||||
Accrued payroll | |||||||||||
Taxes payable | |||||||||||
Crypto settlement liabilities | |||||||||||
Other current liabilities | |||||||||||
Total accrued expenses and other current liabilities | $ | $ | |||||||||
(a) As of March 31, 2023, primarily represents the fair value of the contingent liability earnout for Online Payments Group. As of December 31, 2022, primarily represents the fair value of the contingent liability earnouts for The Giving Block and Online Payments Group. See Note 2 for more information. | |||||||||||
March 31, 2023 | December 31, 2022 | ||||||||||
Indemnification asset (Note 2) | $ | $ | |||||||||
Prepaid expenses and other noncurrent assets | |||||||||||
Contract assets (a) | |||||||||||
Total other noncurrent assets | $ | $ | |||||||||
(a) There was |
March 31, 2023 | December 31, 2022 | ||||||||||
Contingent liability earnouts for acquisitions (a) | $ | $ | |||||||||
Taxes payable (b) | |||||||||||
Deferred revenue | |||||||||||
TRA liability (Note 14) | |||||||||||
Other noncurrent liabilities | |||||||||||
Total other noncurrent liabilities | $ | $ | |||||||||
(a) Primarily represents the fair value of the contingent liability earnout for Online Payments Group. See Note 2 for more information. | |||||||||||
(b) Includes uncertain tax positions of $ |
Three Months Ended March 31, 2023 | |||||||||||||||||
Contingent Liabilities for Acquisitions | Contingent Liabilities for Residual Commission Buyouts | Total Contingent Liabilities | |||||||||||||||
Balance at beginning of period | $ | $ | $ | ||||||||||||||
Contingent consideration for acquisitions | |||||||||||||||||
Contingent liabilities that achieved earnout | ( | ( | ( | ||||||||||||||
Fair value adjustments | |||||||||||||||||
Balance at end of period | $ | $ | $ | ||||||||||||||
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
Carrying Value (a) | Fair Value | Carrying Value (a) | Fair Value | ||||||||||||||||||||
2025 Convertible Notes | $ | $ | $ | $ | |||||||||||||||||||
2027 Convertible Notes | |||||||||||||||||||||||
2026 Senior Notes | |||||||||||||||||||||||
Total | $ | $ | $ | $ | |||||||||||||||||||
(a) Carrying value excludes unamortized debt issuance costs related to the Revolving Credit Facility of $ |
March 31, 2023 | December 31, 2022 | ||||||||||||||||||||||
LLC Interests | Ownership % | LLC Interests | Ownership % | ||||||||||||||||||||
Shift4 Payments, Inc. | % | % | |||||||||||||||||||||
Rook | % | % | |||||||||||||||||||||
Total | 100.0 | % | 100.0 | % |
Three Months Ended March 31, 2023 | |||||||||||
Number of RSUs | Weighted Average Grant Date Fair Value | ||||||||||
Unvested balance at December 31, 2022 | $ | ||||||||||
Granted | |||||||||||
Vested | ( | ||||||||||
Forfeited or cancelled | ( | ||||||||||
Unvested balance at March 31, 2023 | $ | ||||||||||
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Net income (loss) | $ | $ | ( | ||||||||
Less: Net income (loss) attributable to noncontrolling interests | ( | ||||||||||
Net income (loss) attributable to Shift4 Payments, Inc. | ( | ||||||||||
Adjustment to net income (loss) attributable to common stockholders | |||||||||||
Net income (loss) attributable to common stockholders | $ | $ | ( | ||||||||
Numerator - allocation of net income (loss) attributable to common stockholders: | |||||||||||
Net income (loss) allocated to Class A common stock - basic | $ | $ | ( | ||||||||
Reallocation of net income attributable to common stockholders from assumed conversion of LLC interests and assumed vesting of RSUs | |||||||||||
Net income (loss) allocated to Class A common stock - diluted | $ | $ | ( | ||||||||
Net income (loss) allocated to Class C common stock - basic | $ | $ | ( | ||||||||
Reallocation of net income attributable to common stockholders from assumed conversion of LLC interests | ( | ||||||||||
Net income (loss) allocated to Class C common stock - diluted | $ | $ | ( | ||||||||
Denominator: | |||||||||||
Weighted average shares of Class A common stock outstanding - basic | |||||||||||
Effect of dilutive securities: | |||||||||||
LLC Interests | |||||||||||
RSUs | |||||||||||
Weighted average shares of Class A common stock outstanding - diluted | |||||||||||
Weighted average shares of Class C common stock outstanding - basic and diluted | |||||||||||
Net income (loss) per share - Basic: | |||||||||||
Class A common stock | $ | $ | ( | ||||||||
Class C common stock | $ | $ | ( | ||||||||
Net income (loss) per share - Diluted: | |||||||||||
Class A Common Stock | $ | $ | ( | ||||||||
Class C Common Stock | $ | $ | ( |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
LLC Interests that convert into potential Class A common shares | |||||||||||
RSUs and performance RSUs | |||||||||||
Total |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Cash paid for interest | $ | $ | |||||||||
Cash paid for income taxes, net of refunds | |||||||||||
Noncash investing activities | |||||||||||
Shares and equity-based compensation awards issued in connection with acquisitions | |||||||||||
Contingent consideration for acquisitions | |||||||||||
Equipment for lease | |||||||||||
Capitalized software development costs | |||||||||||
Acquisition of property, plant and equipment | |||||||||||
Noncash financing activities | |||||||||||
Shares and equity-based compensation awards measured but not yet issued in connection with settlement of contingent consideration for acquisitions | |||||||||||
Right-of-use assets obtained in exchange for operating lease liabilities |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Payments-based revenue | $ | $ | |||||||||
Subscription and other revenues | |||||||||||
Gross revenue | $ | $ |
Three Months Ended March 31, | |||||||||||||||||||||||
(in millions) | 2023 | 2022 | $ change | % change | |||||||||||||||||||
Payments-based revenue | $ | 511.0 | $ | 371.5 | $ | 139.5 | 37.6 | % | |||||||||||||||
Subscription and other revenues | 36.0 | 30.4 | 5.6 | 18.4 | % | ||||||||||||||||||
Gross revenue | 547.0 | 401.9 | 145.1 | 36.1 | % | ||||||||||||||||||
Network fees | (347.0) | (253.1) | (93.9) | 37.1 | % | ||||||||||||||||||
Other costs of sales (exclusive of certain depreciation and amortization expense shown separately below) | (54.6) | (64.2) | 9.6 | (15.0) | % | ||||||||||||||||||
General and administrative expenses | (85.7) | (66.2) | (19.5) | 29.5 | % | ||||||||||||||||||
Revaluation of contingent liabilities | (7.0) | — | (7.0) | NM | |||||||||||||||||||
Depreciation and amortization expense (a) | (35.3) | (17.3) | (18.0) | 104.0 | % | ||||||||||||||||||
Professional fees | (6.1) | (10.1) | 4.0 | (39.6) | % | ||||||||||||||||||
Advertising and marketing expenses | (2.5) | (2.7) | 0.2 | (7.4) | % | ||||||||||||||||||
Income (loss) from operations | 8.8 | (11.7) | 20.5 | NM | |||||||||||||||||||
Interest income | 7.6 | — | 7.6 | NM | |||||||||||||||||||
Other income, net | 0.1 | 0.2 | (0.1) | (50.0) | % | ||||||||||||||||||
Unrealized gain on investments in securities | 8.9 | — | 8.9 | NM | |||||||||||||||||||
Change in TRA liability | (0.5) | — | (0.5) | NM | |||||||||||||||||||
Interest expense | (8.1) | (7.9) | (0.2) | 2.5 | % | ||||||||||||||||||
Income (loss) before income taxes | 16.8 | (19.4) | 36.2 | NM | |||||||||||||||||||
Income tax benefit | 3.6 | 6.2 | (2.6) | (41.9) | % | ||||||||||||||||||
Net income (loss) | 20.4 | (13.2) | 33.6 | NM | |||||||||||||||||||
Net income (loss) attributable to noncontrolling interests | 5.6 | (5.7) | 11.3 | NM | |||||||||||||||||||
Net income (loss) attributable to Shift4 Payments, Inc. | $ | 14.8 | $ | (7.5) | $ | 22.3 | NM |
Three Months Ended March 31, | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
End-to-end payment volume | $ | 22,256.9 | $ | 13,420.9 | |||||||
Gross revenue less network fees | 200.0 | 148.8 | |||||||||
EBITDA | 64.9 | 17.6 | |||||||||
Adjusted EBITDA | 89.3 | 44.3 |
Three Months Ended March 31, | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Gross revenue | $ | 547.0 | $ | 401.9 | |||||||
Less: Network fees | (347.0) | (253.1) | |||||||||
Less: Other costs of sales (exclusive of depreciation of equipment under lease) | (54.6) | (64.2) | |||||||||
145.4 | 84.6 | ||||||||||
Less: Depreciation of equipment under lease | (7.2) | (7.0) | |||||||||
Gross profit (a) | $ | 138.2 | $ | 77.6 | |||||||
Gross profit (a) | $ | 138.2 | $ | 77.6 | |||||||
Add back: Other costs of sales | 54.6 | 64.2 | |||||||||
Add back: Depreciation of equipment under lease | 7.2 | 7.0 | |||||||||
Gross revenue less network fees | $ | 200.0 | $ | 148.8 | |||||||
Three Months Ended March 31, | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Net income (loss) | $ | 20.4 | $ | (13.2) | |||||||
Interest expense | 8.1 | 7.9 | |||||||||
Interest income | (7.6) | — | |||||||||
Income tax provision (benefit) | (3.6) | (6.2) | |||||||||
Depreciation and amortization expense | 47.6 | 29.1 | |||||||||
EBITDA | 64.9 | 17.6 | |||||||||
Acquisition, restructuring and integration costs (a) | 4.3 | 7.8 | |||||||||
Revaluation of contingent liabilities (b) | 7.0 | — | |||||||||
Change in unrealized gain on investments in securities (c) | (8.9) | — | |||||||||
Change in TRA liability (d) | 0.5 | — | |||||||||
Equity-based compensation (e) | 21.2 | 17.1 | |||||||||
Other nonrecurring items (f) | 0.3 | 1.8 | |||||||||
Adjusted EBITDA | $ | 89.3 | $ | 44.3 | |||||||
(a) For the three months ended March 31, 2023, primarily consisted of $3.9 million of acquisition-related costs. For the three months ended March 31, 2022, primarily consisted of $6.3 million of acquisition-related costs and $1.4 million of transaction-related expenses associated with a consent solicitation for the 2026 Senior Notes in March 2022. | |||||||||||
(b) For the three months ended March 31, 2023, primarily consisted of fair value adjustments to contingent liabilities arising from acquisitions. | |||||||||||
(c) For the three months ended March 31, 2023, represents adjustments to the fair value of investments in non-marketable securities. See Note 13 to the accompanying unaudited condensed consolidated financial statements for more information on the investments in non-marketable securities. | |||||||||||
(d) For the three months ended March 31, 2023, represents adjustments to the TRA liability. See Note 14 to the accompanying unaudited condensed consolidated financial statements for more information on the TRA. | |||||||||||
(e) Represents equity-based compensation expense for RSUs, including employer taxes for vested RSUs. See Note 20 to the accompanying unaudited condensed consolidated financial statements for more information on equity-based compensation. | |||||||||||
(f) For the three months ended March 31, 2022, primarily consisted of $1.2 million of costs associated with an internal processing system disruption that required technical remediation and $0.4 million of costs associated with an early retirement initiative completed in the first quarter of 2022. |
Three Months Ended March 31, | |||||||||||
(in millions) | 2023 | 2022 | |||||||||
Net cash provided by operating activities | $ | 79.4 | $ | 30.8 | |||||||
Net cash used in investing activities | (31.4) | (37.6) | |||||||||
Net cash used in financing activities | (7.0) | (35.7) | |||||||||
Effect of exchange rate changes on cash and cash equivalents | 0.4 | — | |||||||||
Change in cash and cash equivalents | $ | 41.4 | $ | (42.5) |
Incorporated by Reference | ||||||||||||||||||||||||||||||||||||||
Exhibit Number | Exhibit Description | Form | File No. | Exhibit | Filing Date | Filed/Furnished Herewith | ||||||||||||||||||||||||||||||||
3.1 | S-8 | 333-239042 | 4.1 | 06/09/2020 | ||||||||||||||||||||||||||||||||||
3.2 | S-8 | 333-239042 | 4.2 | 06/09/2020 | ||||||||||||||||||||||||||||||||||
4.1 | S-1/A | 333-238307 | 4.1 | 06/01/2020 | ||||||||||||||||||||||||||||||||||
4.2 | 8-K | 001-39313 | 4.1 | 10/29/2020 | ||||||||||||||||||||||||||||||||||
4.3 | 8-K | 001-39313 | 4.1 | 12/07/2020 | ||||||||||||||||||||||||||||||||||
4.4 | 8-K | 001-39313 | 4.1 | 07/26/2021 | ||||||||||||||||||||||||||||||||||
4.5 | 10-Q | 001-39313 | 4.5 | 05/06/2022 | ||||||||||||||||||||||||||||||||||
31.1 | * | |||||||||||||||||||||||||||||||||||||
31.2 | * | |||||||||||||||||||||||||||||||||||||
32.1 | ** | |||||||||||||||||||||||||||||||||||||
32.2 | ** | |||||||||||||||||||||||||||||||||||||
101.INS | Inline 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.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | * | ||||||||||||||||||||||||||||||||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | * | ||||||||||||||||||||||||||||||||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | * | ||||||||||||||||||||||||||||||||||||
104 | Cover Page Interactive Data File (formatting as Inline XBRL and contained in Exhibit 101). | * | ||||||||||||||||||||||||||||||||||||
* Filed herewith. | ||||||||||||||||||||||||||||||||||||||
** Furnished herewith. | ||||||||||||||||||||||||||||||||||||||
Shift4 Payments, Inc. | |||||||||||
By: | /s/ Jared Isaacman | ||||||||||
Jared Isaacman | |||||||||||
Date: | May 9, 2023 | Chief Executive Officer (principal executive officer) | |||||||||
By: | /s/ Nancy Disman | ||||||||||
Nancy Disman | |||||||||||
Date: | May 9, 2023 | Chief Financial Officer (principal financial officer) |
Date: May 9, 2023 | By: | /s/Jared Isaacman | ||||||
Jared Isaacman | ||||||||
Chief Executive Officer | ||||||||
(principal executive officer) |
Date: May 9, 2023 | By: | /s/ Nancy Disman | ||||||
Nancy Disman | ||||||||
Chief Financial Officer | ||||||||
(principal financial officer) |
Date: May 9, 2023 | By: | /s/ Jared Isaacman | ||||||
Jared Isaacman | ||||||||
Chief Executive Officer | ||||||||
(principal executive officer) |
Date: May 9, 2023 | By: | /s/ Nancy Disman | ||||||
Nancy Disman | ||||||||
Chief Financial Officer | ||||||||
(principal financial officer) |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (Parenthetical) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Income Statement [Abstract] | ||
Depreciation and amortization expenses of equipment | $ 7.2 | $ 7.0 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 20.4 | $ (13.2) |
Other comprehensive income | ||
Unrealized gain on foreign currency translation adjustment, net of tax | 3.0 | 0.0 |
Total other comprehensive income | 3.0 | 0.0 |
Comprehensive income (loss) | 23.4 | (13.2) |
Comprehensive income (loss) attributable to noncontrolling interests | 6.5 | (5.7) |
Comprehensive income (loss) attributable to Shift4 Payments, Inc. | $ 16.9 | $ (7.5) |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (Unaudited) - USD ($) $ in Millions |
Total |
Additional Paid-In Capital |
Treasury Stock |
Retained Deficit |
Accumulated Other Comprehensive Income |
Noncontrolling Interests |
Class A Common Stock |
Class A Common Stock
Common Stock
|
Class B Common Stock |
Class B Common Stock
Common Stock
|
Class C Common Stock |
Class C Common Stock
Common Stock
|
---|---|---|---|---|---|---|---|---|---|---|---|---|
Balance at beginning of period (in shares) at Dec. 31, 2021 | 51,793,127 | 26,272,654 | 5,035,181 | |||||||||
Balance at beginning of period at Dec. 31, 2021 | $ 399.7 | $ 619.2 | $ (21.1) | $ (325.3) | $ 126.9 | $ 0.0 | $ 0.0 | $ 0.0 | ||||
Balance at beginning of period, Treasury stock (in shares) at Dec. 31, 2021 | (378,475) | |||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income (loss) | (13.2) | (7.5) | (5.7) | |||||||||
Exchange of shares held (in shares) | 732,524 | (732,524) | ||||||||||
Exchange of shares held | 0.0 | |||||||||||
Issuance of Class A common stock and fair value of equity-based compensation awards assumed in connection with acquisition (in shares) | 785,969 | |||||||||||
Issuance of Class A common stock and fair value of equity-based compensation awards assumed in connection with acquisition | 36.5 | 24.7 | 11.8 | |||||||||
Repurchases of Class A common stock to treasury stock (in shares) | (301,510) | |||||||||||
Repurchases of Class A common stock to treasury stock | (17.2) | 4.5 | $ (17.2) | (4.5) | ||||||||
Equity-based compensation | 15.8 | 15.8 | ||||||||||
Vesting of restricted stock units, net of tax withholding (in shares) | 306,953 | |||||||||||
Vesting of restricted stock units, net of tax withholding | (3.4) | (4.6) | 1.2 | |||||||||
Balance at end of period (in shares) at Mar. 31, 2022 | 53,618,573 | 26,272,654 | 4,302,657 | |||||||||
Balance at end of period at Mar. 31, 2022 | 418.2 | 659.6 | $ (38.3) | (332.8) | 129.7 | $ 0.0 | $ 0.0 | $ 0.0 | ||||
Balance at end of period, Treasury stock (in shares) at Mar. 31, 2022 | (679,985) | (301,510) | ||||||||||
Balance at beginning of period (in shares) at Dec. 31, 2022 | 54,153,218 | 54,153,218 | 25,829,016 | 25,829,016 | 2,889,811 | 2,889,811 | ||||||
Balance at beginning of period at Dec. 31, 2022 | 480.6 | 702.6 | (363.6) | $ 8.3 | 133.3 | $ 0.0 | $ 0.0 | $ 0.0 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income (loss) | 20.4 | 14.8 | 5.6 | |||||||||
Issuance of Class A common stock in connection with acquisitions and residual commission buyouts (in shares) | 27,780 | |||||||||||
Issuance of Class A common stock in connection with acquisitions and residual commission buyouts | 7.6 | 5.5 | 2.1 | |||||||||
Exchange of shares held (in shares) | 2,465,770 | (1,666,665) | (1,666,665) | (799,105) | ||||||||
Exchange of shares held | 0.0 | 4.9 | (4.9) | |||||||||
Distributions to noncontrolling interests | (1.8) | (1.8) | ||||||||||
Equity-based compensation | 21.9 | 21.9 | ||||||||||
Vesting of restricted stock units, net of tax withholding (in shares) | 123,846 | |||||||||||
Vesting of restricted stock units, net of tax withholding | (5.3) | (4.7) | (0.6) | |||||||||
Other comprehensive income | 3.0 | 2.1 | 0.9 | |||||||||
Balance at end of period (in shares) at Mar. 31, 2023 | 56,770,614 | 56,770,614 | 24,162,351 | 24,162,351 | 2,090,706 | 2,090,706 | ||||||
Balance at end of period at Mar. 31, 2023 | $ 526.4 | $ 730.2 | $ (348.8) | $ 10.4 | $ 134.6 | $ 0.0 | $ 0.0 | $ 0.0 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Operating activities | ||
Net income (loss) | $ 20.4 | $ (13.2) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation and amortization | 47.6 | 29.1 |
Amortization of capitalized financing costs | 2.1 | 1.9 |
Deferred income taxes | (5.6) | (6.3) |
Provision for bad debts | 3.2 | 3.0 |
Revaluation of contingent liabilities | 7.0 | 0.0 |
Unrealized gain on investments in securities | (8.9) | 0.0 |
Change in TRA liability | 0.5 | 0.0 |
Equity-based compensation expense | 20.9 | 16.9 |
Other noncash items | 0.3 | 0.3 |
Change in operating assets and liabilities | ||
Accounts receivable | (17.1) | (20.0) |
Prepaid expenses and other assets | 0.1 | 0.6 |
Inventory | 0.7 | 1.7 |
Capitalized customer acquisition costs | (7.3) | (6.3) |
Accounts payable | 5.3 | 15.4 |
Accrued expenses and other current liabilities | 5.9 | 3.1 |
Right-of-use assets and lease liabilities, net | 0.1 | (0.1) |
Deferred revenue | 4.2 | 4.7 |
Net cash provided by operating activities | 79.4 | 30.8 |
Investing activities | ||
Residual commission buyouts | (2.1) | (4.6) |
Acquisitions, net of cash acquired | (1.2) | (12.6) |
Acquisition of equipment to be leased | (14.7) | (9.9) |
Capitalized software development costs | (10.7) | (8.0) |
Acquisition of property, plant and equipment | (2.7) | (1.0) |
Investments in securities | 0.0 | (1.5) |
Net cash used in investing activities | (31.4) | (37.6) |
Financing activities | ||
Repurchases of Class A common stock to treasury stock | 0.0 | (18.7) |
Payments for withholding tax related to vesting of restricted stock units | (5.3) | (12.2) |
Deferred financing costs | 0.0 | (4.8) |
Distributions to noncontrolling interests | (1.4) | 0.0 |
Payments on contingent liabilities | (0.3) | 0.0 |
Net cash used in financing activities | (7.0) | (35.7) |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | 0.4 | 0.0 |
Change in cash and cash equivalents and restricted cash | 41.4 | (42.5) |
Cash and cash equivalents and restricted cash | ||
Beginning of period | 776.5 | 1,231.5 |
End of period | $ 817.9 | $ 1,189.0 |
Organization, Basis of Presentation and Significant Accounting Policies |
3 Months Ended |
---|---|
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Basis of Presentation and Significant Accounting Policies | Organization, Basis of Presentation and Significant Accounting Policies Organization Shift4 Payments, Inc. (“Shift4 Payments” or “the Company”) was incorporated in Delaware on November 5, 2019 in order to carry on the business of Shift4 Payments, LLC and its consolidated subsidiaries. The Company is a leading independent provider of software and payment processing solutions in the United States (“U.S.”) based on total volume of payments processed. The Company has achieved its leadership position through decades of solving business and operational challenges facing its customers’ overall commerce needs. The Company’s merchants range in size from small owner-operated local businesses to multinational enterprises conducting commerce throughout the world. The Company distributes its services through a scaled network of seasoned internal sales and support teams, as well as through its network of software partners. For its software partners, the Company offers a single integration to a global end-to-end payment offering, a proprietary gateway and a robust suite of technology solutions (including cloud enablement, business intelligence, analytics, and mobile) to enhance the value of their software and simplify payment acceptance. For its merchants, the Company provides a seamless, unified consumer experience and fulfills business needs that would otherwise require multiple software, hardware and payment vendors. The Shift4 Model is built to serve a range of merchants from small owner-operated local businesses to multinational enterprises conducting commerce throughout the world, including food and beverage, hospitality, stadiums and arenas, gaming, specialty retail, non-profits, eCommerce, and exciting technology companies. This includes the Company’s point of sale (“POS”) software offerings, as well as over 500 software integrations across virtually every industry vertical. Basis of Presentation The accompanying interim condensed consolidated financial statements of the Company are unaudited. These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the U.S. (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial information. As such, these financial statements do not include all information and footnotes required by U.S. GAAP for complete financial statements. The December 31, 2022 Condensed Consolidated Balance Sheet was derived from audited financial statements as of that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments consisting only of normal recurring adjustments necessary to state fairly the financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP applicable to interim periods. The results of operations for the interim periods presented are not necessarily indicative of results for the full year or future periods. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto as of and for the fiscal year ended December 31, 2022, as disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the “2022 Form 10-K”). The unaudited condensed consolidated financial statements include the accounts of Shift4 Payments, Inc. and its wholly-owned subsidiaries. Shift4 Payments, Inc. consolidates the financial results of Shift4 Payments, LLC, which is considered a variable interest entity. Shift4 Payments, Inc. is the primary beneficiary and sole managing member of Shift4 Payments, LLC and has decision making authority that significantly affects the economic performance of the entity. As a result, the Company consolidates Shift4 Payments, LLC and reports a noncontrolling interest representing the economic interest in Shift4 Payments, LLC held by Rook Holdings Inc. (“Rook”). All intercompany balances and transactions have been eliminated in consolidation. The assets and liabilities of Shift4 Payments, LLC represent substantially all of the consolidated assets and liabilities of Shift4 Payments, Inc. with the exception of certain cash balances, contingent consideration for earnout liabilities for The Giving Block, Inc. (“The Giving Block”), amounts payable under the Tax Receivable Agreement (“TRA”), and the aggregate principal amount of $690.0 million of 2025 Convertible Notes and $632.5 million of 2027 Convertible Notes (together, the “Convertible Notes”) that are held by Shift4 Payments, Inc. directly. As of March 31, 2023 and December 31, 2022, $12.3 million and $9.8 million of cash, respectively, was directly held by Shift4 Payments, Inc. As of March 31, 2023 and December 31, 2022, the earnout liability for The Giving Block was $2.9 million and $10.9 million, respectively. The $2.9 million liability as of March 31, 2023 represents the cash portion of the earnout, which is expected to be paid in the second quarter of 2023. As of March 31, 2023 and December 31, 2022, the TRA liability was $2.2 million and $1.7 million, respectively. In connection with the issuance of the Convertible Notes, Shift4 Payments, Inc. entered into Intercompany Convertible Notes with Shift4 Payments, LLC, whereby Shift4 Payments, Inc. provided the net proceeds from the issuance of the Convertible Notes to Shift4 Payments, LLC in the amount of $1,322.5 million. Shift4 Payments, Inc., which was incorporated on November 5, 2019, has not had any material operations on a standalone basis since its inception, and all of the operations of the Company are carried out by Shift4 Payments, LLC and its subsidiaries. Shift4 Payments, Inc. recognized fair value adjustments to the contingent liability for The Giving Block of $(0.5) million for the three months ended March 31, 2023 due to the final measurement of the earnout payment. Change in Presentation of Unaudited Condensed Consolidated Balance Sheets Certain prior year balances have been adjusted to present “Restricted cash” on its own line item rather than within “Cash and cash equivalents” on the Company’s unaudited Condensed Consolidated Balance Sheets to conform to the current period presentation. Change in Presentation of Unaudited Condensed Consolidated Statements of Operations Certain prior year balances have been adjusted to present “Transaction-related expenses” within “Professional fees” rather than its own line item on the Company’s unaudited Condensed Consolidated Statements of Operations. Liquidity and Management’s Plan As of March 31, 2023, the Company had $1,772.5 million total principal amount of debt outstanding and was in compliance with the financial covenants under its debt agreements. The Company expects to be in compliance with such financial covenants for at least 12 months following the issuance of these unaudited condensed consolidated financial statements. See Note 11 for further information on the Company’s debt obligations. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s unaudited condensed consolidated financial statements and accompanying notes. Significant estimates inherent in the preparation of the accompanying unaudited condensed consolidated financial statements include estimates of fair value of acquired assets and liabilities through business combinations, fair value of contingent liabilities related to earnout payments, deferred income tax valuation allowances, amounts associated with the Company’s tax receivable agreement with Rook and certain affiliates of Searchlight Capital Partners (together, the “Continuing Equity Owners”), fair value of debt instruments, allowance for doubtful accounts, income taxes, investments in securities and noncontrolling interests. Estimates are based on past experience and other considerations reasonable under the circumstances. Actual results may differ from these estimates. Significant Accounting Policies The Company’s significant accounting policies are discussed in Note 2 to Shift4 Payments, Inc.’s consolidated financial statements as of and for the year ended December 31, 2022 in the 2022 Form 10-K. There have been no significant changes to these policies which have had a material impact on the Company’s unaudited condensed consolidated financial statements and related notes during the three months ended March 31, 2023, except for the below. Cash and Cash Equivalents and Restricted Cash Highly liquid investments with maturities of three months or less at the date of purchase are considered to be cash equivalents and are stated at cost, which approximates fair value. The Company’s cash equivalents consist of highly liquid investments in money market funds, which amounted to $672.2 million and $652.8 million as of March 31, 2023 and December 31, 2022, respectively. The Company classifies as restricted certain cash that is not available for use in its operations. Prior to December 2022, the Company had funds deposited in a sponsor bank merchant settlement account (“Settlement Funds”) to facilitate gross card transaction deposits for those customers the Company bills on a monthly, versus a daily basis. This amount fluctuates based upon end-to-end payment volumes and timing of billing cycles. The funds deposited at the sponsor bank were included within “Accounts receivable, net” prior to December 2022. In December 2022 and March 2023, pursuant to amendments to its agreement, the Company received in cash its Settlement Funds of $74.0 million, which was restricted as to withdrawal by the sponsor bank. In January 2023 and April 2023, the Company, as required by the amendments, deposited $74.0 million to its sponsor bank merchant settlement account. See Note 24 for more information on the April 2023 amendment to the sponsor bank agreement. As of both March 31, 2023 and December 31, 2022, Restricted cash was $74.0 million, representing the Company’s Settlement Funds. The Company maintains its cash with what are widely considered to be high credit quality financial institutions. The total cash balances insured by the Federal Deposit Insurance Corporation are up to $250 thousand per bank. Recent Accounting Pronouncements Accounting Pronouncements Not Yet Adopted In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform, which provides optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships, subject to certain criteria, that reference the London Interbank Offered Rate (“LIBOR”), or another reference rate that is expected to be discontinued. ASU 2020-04 was subsequently amended by ASU 2022-06, Reference Rate Reform, which extends the date through which entities can elect these optional expedients and exceptions. Companies may elect to apply these amendments as of March 12, 2020 through December 31, 2024. The Company is currently evaluating whether it will elect the optional expedients, as well as evaluating the impact of ASU 2020-04 on the Company’s unaudited condensed consolidated financial statements. In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, to clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring the fair value of the equity security. ASU 2022-03 also clarifies that an entity cannot recognize and measure a contractual sale restriction as a separate unit of account. The amendments in ASU 2022-03 may be early adopted and are effective on a prospective basis for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The Company currently considers sale restrictions in measuring the fair value of shares of its Class A common stock equity securities issued in conjunction with acquisitions. The Company is currently evaluating whether it will early adopt the amendments in ASU 2022-03 and is evaluating the impact of the amendments on the Company’s unaudited condensed consolidated financial statements.
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Acquisitions |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions | AcquisitionsEach of the following acquisitions was accounted for as a business combination using the acquisition method of accounting. The respective purchase prices were allocated to the assets acquired and liabilities assumed based on the estimated fair values at the date of acquisition. The excess of the purchase price over the fair value of the net assets acquired was allocated to goodwill and represents the future economic benefits arising from other assets acquired, which cannot be individually identified or separately recognized. Online Payments Group On September 29, 2022, the Company completed the acquisition of Online Payments Group AG (“Online Payments Group”) by acquiring 100% of its common stock for $125.9 million of estimated total purchase consideration, net of cash acquired. Online Payments Group is a European payment service provider with a world-class developer portal and checkout experience that management believes will accelerate the Company’s global eCommerce growth. Total purchase consideration was as follows:
The following table summarizes the fair value assigned to the assets acquired and liabilities assumed at the acquisition date. These amounts reflect various preliminary fair value estimates and assumptions, and are subject to change within the measurement period as valuations are finalized. The primary areas of preliminary purchase price allocation subject to change relate to the valuation of contingent consideration, accounts receivable, accrued expenses and other current liabilities assumed, and residual goodwill.
Upon acquisition, the Company assessed the probability Online Payments Group would be required to pay certain tax liabilities and recorded to “Other noncurrent liabilities” on the Company’s unaudited Condensed Consolidated Balance Sheets $6.7 million for income taxes related to unrecognized tax benefits determined in accordance with the provisions of ASC 740, “Accounting for income taxes” and $1.8 million for non-income taxes determined in accordance with the provisions of ASC 450, “Contingencies.” Online Payments Group has agreed to indemnify the Company for tax liabilities related to periods prior to the acquisition and an indemnification asset was established for $7.5 million in the purchase price allocation, which is recorded to “Other noncurrent assets” on the Company’s unaudited Condensed Consolidated Balance Sheets. The contingent liability arising from the expected earnout payment included in purchase consideration was measured on the acquisition date using a Monte Carlo simulation in a risk-neutral framework, calibrated to Management’s revenue forecasts. The transaction was not taxable for income tax purposes. Other intangible assets consists of definite-lived intangible assets, which includes customer relationships and developed technology. The fair values of these intangible assets were estimated using inputs classified as Level 3 under the income approach using the relief-from-royalty method (developed technology) or the multi-period excess earnings method (customer relationships). Management’s estimates of fair value are based upon assumptions related to projected revenues, earnings before interest expense and income tax (“EBIT”) margins, customer attrition rates, and discount rates. The transaction was not taxable for income tax purposes. The weighted average life of developed technology and customer relationships is 8 years and 13 years, respectively. The goodwill arising from the acquisition largely consisted of revenue synergies associated with a larger total addressable market and the ability to cross-sell existing customers, new customers and technology capabilities. The acquisition of Online Payments Group did not have a material impact on the Company’s unaudited condensed consolidated financial statements. Accordingly, revenue and expenses related to the acquisition and pro forma financial information have not been presented. Restaurant Technology Partners During the year ended December 31, 2022, the Company completed the acquisitions of Pinnacle Hospitality Systems LLC (“Pinnacle”), FPOS Group, Inc. (“FPOS”), Retail Control Solutions, Inc. (“RCS”), and three other restaurant technology partners in separate transactions for $80.3 million of total purchase consideration, net of cash acquired. In addition, on January 20, 2023, the Company completed the acquisition of one restaurant technology partner for $1.5 million, net of cash acquired. The Company acquired 100% of each entity’s ownership interests. These acquisitions enable the boarding of the restaurant technology partners’ customers on the Company’s end-to-end acquiring solution and empower the Company’s distribution partners to sign the restaurant technology partners’ customer accounts and leverage the combined expertise to handle all aspects of installation, service, and support. Total purchase consideration was as follows:
The following table summarizes the fair value assigned to the assets acquired and liabilities assumed at the acquisition dates. These amounts reflect various preliminary fair value estimates and assumptions, and are subject to change within the measurement period as valuations are finalized. The primary areas of preliminary purchase price allocation subject to change relate to the valuation of contingent consideration, other intangible assets, and residual goodwill.
The fair values of intangible assets were estimated using inputs classified as Level 3 under the income approach using the multi-period excess earnings method (customer relationships). Four of the transactions were taxable for income tax purposes and three of the transactions were not taxable for income tax purposes. The weighted average lives of customer relationships range from 6 years to 14 years. The weighted average lives of residual commission buyouts range from 5 years to 9 years. The goodwill arising from the acquisitions largely consisted of revenue synergies associated with a larger total addressable market and the ability to cross-sell existing and new customers. The acquisitions of the restaurant technology partners did not have a material impact on the Company’s unaudited condensed consolidated financial statements. Accordingly, revenue and expenses related to the acquisition and pro forma financial information have not been presented. The Giving Block On February 28, 2022, the Company completed the acquisition of The Giving Block by acquiring 100% of its common stock for $106.9 million of total purchase consideration, net of cash acquired. The Giving Block is a cryptocurrency donation marketplace that the Company expects to accelerate its growth in the non-profit sector with significant cross-sell potential. Total purchase consideration was as follows:
The following table summarizes the fair value assigned to the assets acquired and liabilities assumed at the acquisition date:
The fair values of intangible assets were estimated using inputs classified as Level 3 under the income approach using either the relief-from-royalty method (developed technology and trade name), the with or without method (donor relationships) or the multi-period excess earnings method (customer relationships). The contingent liability arising from the expected earnout payment included in purchase consideration was measured on the acquisition date using a Monte Carlo simulation in a risk-neutral framework, calibrated to Management’s revenue forecasts. The transaction was not taxable for income tax purposes. The weighted average life of developed technology, the trade name, donor relationships and customer relationships is 8 years, 15 years, 5 years and 15 years, respectively. The goodwill arising from the acquisition largely consisted of revenue synergies associated with a larger total addressable market and the ability to cross-sell existing customers, new customers and technology capabilities. The acquisition of The Giving Block did not have a material impact on the Company’s unaudited condensed consolidated financial statements. Accordingly, revenue and expenses related to the acquisition and pro forma financial information have not been presented.
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Revenue |
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Revenue | Revenue ASC 606, Revenue from Contracts with Customers (“ASC 606”) Under ASC 606, the Company has three separate performance obligations under its recurring software as a service agreements (“SaaS”) arrangements for point-of-sale systems provided to merchants: (1) point-of-sale software, (2) lease of hardware and (3) other support services. Disaggregated Revenue Based on similar operational characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
Based on similar economic characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
Contract Liabilities The Company charges merchants for various post-contract license support/service fees and annual regulatory compliance fees. These fees typically relate to a period of one year. The Company recognizes the revenue on a straight-line basis over its respective period. As of March 31, 2023 and December 31, 2022, the Company had deferred revenue of $23.3 million and $19.1 million, respectively. The change in the contract liabilities was primarily the result of a timing difference between payment from the customer and the Company’s satisfaction of each performance obligation. The following reflects the amounts the Company recognized as annual service fees and regulatory compliance fees within “Gross revenue” in the Company’s unaudited Condensed Consolidated Statements of Operations and the amount of such fees that were included in deferred revenue at the beginning of each respective period:
Allowance for Doubtful Accounts The change in the Company’s allowance for doubtful accounts was as follows:
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Goodwill |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Goodwill | Goodwill The changes in the carrying amount of goodwill were as follows:
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Depreciation and Amortization |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Depreciation and Amortization | Depreciation and Amortization Amounts charged to expense in the Company’s unaudited Condensed Consolidated Statements of Operations for depreciation and amortization were as follows:
(a) Total amortization of $38.9 million consisted of amortization of acquired intangibles of $30.0 million and amortization of non-acquired intangibles of $8.9 million. (b) Total amortization of $20.8 million consisted of amortization of acquired intangibles of $12.5 million and amortization of non-acquired intangibles of $8.3 million. As of March 31, 2023, the estimated amortization expense for each of the five succeeding years and thereafter is as follows:
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Residual Commission Buyouts |
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residual Commission Buyouts | Residual Commission Buyouts Residual commission buyouts, net consisted of the following:
Residual commission buyouts represent transactions with certain third-party distribution partners, pursuant to which the Company acquires their ongoing merchant relationships that subscribe to the Company’s end-to-end payments platform. During the year ended December 31, 2022, the Company executed $305.4 million of residual commission buyouts under the Company’s strategic buyout program in support of the Company’s initiative to insource its sales distribution network. Contingent consideration included in Residual commission buyouts, net as of March 31, 2023 and December 31, 2022 was $14.2 million, of which $8.3 million was related to residual commission buyouts executed under the strategic buyout program which was estimated based on projected attrition rates and other financial metrics within the respective merchant portfolios over the earnout periods. As of March 31, 2023 and December 31, 2022, the maximum contingent consideration for residual buyout commissions executed under the Company’s strategic buyout program was $23.0 million.
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Other Intangible Assets, Net |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Intangible Assets, Net | Other Intangible Assets, Net Other intangible assets, net consisted of the following:
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Capitalized Customer Acquisition Costs, Net |
3 Months Ended |
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Mar. 31, 2023 | |
Capitalized Customer Acquisition Costs, Net [Abstract] | |
Capitalized Customer Acquisition Costs, Net | Capitalized Customer Acquisition Costs, Net Capitalized customer acquisition costs, net were $39.6 million and $36.1 million at March 31, 2023 and December 31, 2022, respectively. These amounts consist of upfront processing bonuses with a gross carrying value of $78.6 million and $72.3 million less accumulated amortization of $39.0 million and $36.2 million at March 31, 2023 and December 31, 2022, respectively. Capitalized customer acquisition costs had a weighted average amortization period of four years at both March 31, 2023 and December 31, 2022.
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Equipment for Lease, Net |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equipment for Lease, Net | Equipment for Lease, Net Equipment for lease, net consisted of the following:
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Property, Plant and Equipment, Net |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment, net consisted of the following:
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Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt The Company’s outstanding debt consisted of the following:
Amortization of capitalized financing fees is included within “Interest expense” in the Company’s unaudited Condensed Consolidated Statements of Operations. Amortization expense for capitalized financing fees was $2.1 million and $1.9 million for the three months ended March 31, 2023 and 2022, respectively. Future principal payments As of March 31, 2023, future principal payments associated with the Company’s long-term debt were as follows:
Convertible Notes due 2025 The net carrying amount of the Convertible Senior Notes due 2025 (“2025 Convertible Notes”) was as follows:
Senior Notes due 2026 The net carrying amount of the 4.625% Senior Notes due 2026 (“2026 Senior Notes”) was as follows:
Convertible Notes due 2027 The net carrying amount of the 0.50% Convertible Senior Notes due 2027 (“2027 Convertible Notes”) was as follows:
Revolving Credit Facility Borrowing capacity on the Company’s Revolving Credit Facility was $100.0 million as of March 31, 2023. Restrictions and Covenants The 2025 Convertible Notes, 2026 Senior Notes, 2027 Convertible Notes (collectively, the “Notes”) and Revolving Credit Facility include certain restrictions on the ability of Shift4 Payments, LLC to make loans, advances, or pay dividends to Shift4 Payments, Inc. At March 31, 2023 and December 31, 2022, the Company was in compliance with all financial covenants. Other than as provided above, there are no significant changes to the information disclosed in the 2022 Form 10-K.
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Other Consolidated Balance Sheet Components |
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Other Consolidated Balance Sheet Components [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Consolidated Balance Sheet Components | Other Consolidated Balance Sheet Components Prepaid expenses and other current assets Prepaid expenses and other current assets consisted of the following:
Accrued expenses and other current liabilities Accrued expenses and other current liabilities consisted of the following:
Other noncurrent assets Other noncurrent assets consisted of the following:
Other noncurrent liabilities Other noncurrent liabilities consisted of the following:
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Fair Value Measurement |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurement | Fair Value Measurement U.S. GAAP defines a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted process in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The Company determines the fair values of its assets and liabilities that are recognized or disclosed at fair value in accordance with the hierarchy described below. The following three levels of inputs may be used to measure fair value: •Level 1—Quoted prices in active markets for identical assets or liabilities; •Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and •Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include items where the determination of fair value requires significant management judgment or estimation. The Company makes recurring fair value measurements of contingent liabilities arising from certain acquisitions and residual commission buyouts using Level 3 unobservable inputs. Contingent liabilities for residual commission buyouts are expected earnout payments related to the number of existing point-of-sale merchants that convert to full acquiring merchants. Contingent liabilities included in the purchase price of an acquisition are based on achievement of specified performance metrics as defined in the purchase agreement. In conjunction with the acquisition of Online Payments Group on September 29, 2022, the Company entered into a contingent consideration agreement that requires the Company to pay up to $60.0 million if key customers of Online Payments Group contribute a certain amount of revenue for the twelve months ending September 28, 2023 and the twenty-four months ending September 28, 2024. The fair value of the contingent consideration was estimated using a Monte-Carlo simulation model, which included significant unobservable Level 3 inputs, such as projected revenues over the earnout period along with estimates for revenue volatility of 53.6% and 54.4% as of March 31, 2023 and December 31, 2022, respectively, and the discount rate of 7.6% and 7.2% as of March 31, 2023 and December 31, 2022, respectively. See Note 2 for more information on the terms of the earnout agreement. The Company recognized fair value adjustments to the contingent liability for Online Payments Group of $7.0 million for the three months ended March 31, 2023, primarily due to an increase in projected revenues over the earnout period. The fair value adjustments are recognized in “Revaluation of contingent liabilities” on the Company’s unaudited Condensed Consolidated Statements of Operations. The estimated fair value of the contingent consideration was $40.2 million as of March 31, 2023, of which $28.0 million is recognized in “Accrued expenses and other current liabilities” and $12.2 million is recognized in “Other noncurrent liabilities” on the Company’s unaudited Condensed Consolidated Balance Sheets. In conjunction with the acquisition of The Giving Block on February 28, 2022, the Company entered into a contingent consideration agreement that required the Company to pay up to $246.0 million if certain revenue thresholds of the acquired business were achieved for the twelve months ending February 28, 2023. Prior to the final measurement date, the fair value of the contingent consideration was estimated using a Monte-Carlo simulation model, which included significant unobservable Level 3 inputs, such as projected revenues over the earnout period, estimates for revenue volatility, and the discount rate. See Note 2 for more information on the terms of the earnout agreement. The earnout, valued at $10.2 million as of March 31, 2023, reflects the final measurement of the earnout payment. The Company recognized a fair value adjustment to the contingent liability for The Giving Block of $(0.5) million for the three months ended March 31, 2023 due to the final measurement of the earnout payment. The fair value adjustment is recognized in “Revaluation of contingent liabilities” on the Company’s unaudited Condensed Consolidated Statements of Operations. In conjunction with the acquisitions of certain restaurant technology partners in 2022 and 2023, the Company entered into contingent consideration agreements that require the Company to pay up to an aggregate of $6.5 million. The fair values of the contingent consideration were estimated using Monte-Carlo simulation models, which included significant unobservable Level 3 inputs, such as projected performance over the earnout periods and discount rates ranging from 6.5% to 7.3% as of March 31, 2023 and from 5.1% to 6.7% as of December 31, 2022. See Note 2 for more information on the terms of the earnout agreements. The Company recognized fair value adjustments to the contingent liability for the restaurant technology partners of $0.5 million for the three months ended March 31, 2023, primarily due to an increase in expected performance over the earnout period. The estimated fair value of the contingent consideration is $2.1 million as of March 31, 2023, of which $0.5 million is recognized in “Accrued expenses and other current liabilities” and $1.6 million is recognized in “Other noncurrent liabilities” on the Company’s unaudited Condensed Consolidated Balance Sheets. In conjunction with residual commission buyouts executed in conjunction with asset acquisitions, the Company entered into contingent consideration agreements that require the Company to pay up to an aggregate of $24.5 million. The fair values of the contingent consideration were estimated based on projected attrition rates and other financial metrics within the respective merchant portfolios over the earnout periods. The estimated fair value of the contingent consideration related to residual commission buyouts of $9.8 million as of March 31, 2023 is recognized in “Accrued expenses and other current liabilities” on the Company’s Consolidated Balance Sheets. The table below provides a reconciliation of the beginning and ending balances for the Level 3 contingent liabilities:
Fair value adjustments for contingent liabilities are recorded within “Revaluation of contingent liabilities” in the Company’s unaudited Condensed Consolidated Statements of Operations. There were no transfers into or out of Level 3 during the three months ended March 31, 2023. The estimated fair value of the Company’s outstanding debt using quoted prices from over-the-counter markets, considered Level 2 inputs, was as follows:
The estimated fair value of the Company’s investments in securities was $56.0 million and $47.1 million as of March 31, 2023 and December 31, 2022, respectively. These non-marketable equity investments have no readily determinable fair values and are measured using the measurement alternative, which is defined as cost, less impairment, adjusted for observable price changes from orderly transactions for identical or similar investments of the same issuer. Adjustments for these investments, if any, are recorded in “Unrealized gain on investments in securities” on the Company’s unaudited Condensed Consolidated Statements of Operations. The Company recognized fair value adjustments to its investments in securities of $8.9 million for the three months ended March 31, 2023, the entire amount of which related to securities still held as of March 31, 2023, based on secondary offerings of identical securities by the respective companies in 2023. The Company has recognized cumulative fair value adjustments to its investments in securities of $24.0 million. The estimated fair value of the Company’s crypto settlement assets and crypto settlement liabilities was $3.2 million and $1.8 million as of March 31, 2023 and December 31, 2022, respectively. There are no active markets for the Company’s crypto settlement liabilities and the corresponding crypto settlement assets. Accordingly, the Company has valued the assets and liabilities using quoted prices from active cryptocurrency exchanges for the underlying crypto assets, considered Level 2 inputs. Other financial instruments not measured at fair value on the Company’s unaudited Condensed Consolidated Balance Sheets as of March 31, 2023 and December 31, 2022 include cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, other noncurrent assets, accounts payable, accrued expenses and other current liabilities, and other noncurrent liabilities, as their estimated fair values reasonably approximate their carrying value as reported on the Company’s unaudited Condensed Consolidated Balance Sheets.
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Income Taxes |
3 Months Ended |
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Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company holds an economic interest in Shift4 Payments, LLC and consolidates its financial position and results. The remaining ownership of Shift4 Payments, LLC not held by the Company is considered a noncontrolling interest. Shift4 Payments, LLC is treated as a partnership for income tax reporting and its members, including the Company, are liable for federal, state, and local income taxes based on their share of the LLC’s taxable income. In addition, Shift4 Payments, LLC wholly owns various U.S. and foreign subsidiaries which are taxed as corporations for tax reporting. Taxable income or loss from these subsidiaries is not passed through to Shift4 Payments, LLC. Instead, such taxable income or loss is taxed at the corporate level subject to the prevailing corporate tax rates. The Company has assessed the realizability of the net deferred tax assets and in that analysis has considered the relevant positive and negative evidence available to determine whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The Company has recorded a full valuation allowance against the deferred tax assets at Shift4 Payments, Inc. as of March 31, 2023, which will be maintained until there is sufficient evidence to support the reversal of all or some portion of these allowances. The Company’s effective tax rate was (21.4)% and (32.0)% for the three months ended March 31, 2023 and 2022, respectively. The effective tax rate for the three months ended March 31, 2023 was different than the U.S. federal statutory income tax rate of 21% primarily due to the income allocated to the noncontrolling interest, the full valuation allowances on Shift4 Payments, Inc. and certain corporate subsidiaries in the U.S., and a $4.8 million tax benefit related to the valuation allowance release due to a legal entity restructuring. The effective tax rate for the three months ended March 31, 2022 was different than the U.S. federal statutory income tax rate of 21% primarily due to the loss allocated to the noncontrolling interest, the full valuation allowance on Shift4 Payments, Inc. and certain corporate subsidiaries in the U.S., and a $6.4 million income tax benefit related to the valuation allowance release due to acquired deferred tax liabilities from The Giving Block. Uncertain Tax Positions The effects of uncertain tax positions are recognized in the condensed consolidated financial statements if these positions meet a “more-likely-than-not” threshold. For those uncertain tax positions that are recognized in the condensed consolidated financial statements, liabilities are established to reflect the portion of those positions it cannot conclude “more-likely-than-not” to be realized upon ultimate settlement. The Company’s policy is to recognize interest and penalties related to unrecognized tax benefits within “Income tax (provision) benefit” in the Company’s unaudited Condensed Consolidated Statements of Operations. Accrued interest and penalties, if any, are included within “Deferred tax liability” in the Company’s Condensed Consolidated Balance Sheets. As of March 31, 2023 and December 31, 2022, $8.1 million and $8.0 million, respectively, of uncertain tax positions were recognized within “Other noncurrent liabilities” in the Company’s unaudited Condensed Consolidated Balance Sheets, which were recognized in conjunction with acquisitions. Tax Receivable Agreement The Company expects to obtain an increase in its share of the tax basis in the net assets of Shift4 Payments, LLC as LLC Interests are redeemed from or exchanged by the Continuing Equity Owners, at the option of the Company, determined solely by the Company’s independent directors. The Company intends to treat any redemptions and exchanges of LLC Interests as direct purchases of LLC Interests for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that it would otherwise pay in the future to various tax authorities. In connection with the Company’s initial public offering in June 2020 and certain organizational transactions that the Company effected in connection with it, the Company entered into the TRA with the Continuing Equity Owners. The TRA provides for the payment by Shift4 Payments, Inc. of 85% of the amount of any tax benefits the Company actually realizes, or in some cases is deemed to realize, as a result of (i) increases in the Company’s share of the tax basis in the net assets of Shift4 Payments, LLC resulting from any redemptions or exchanges of LLC Interests, (ii) tax basis increases attributable to payments made under the TRA, and (iii) deductions attributable to imputed interest pursuant to the TRA. The Company expects to benefit from the remaining 15% of any of cash savings that it realizes. As of March 31, 2023 and December 31, 2022, the Company recognized a TRA liability of $2.2 million and $1.7 million, respectively, after concluding it was probable that, based on estimates of future taxable income, the Company will realize tax benefits associated with the TRA. The liability is recognized in “Other noncurrent liabilities” on the Company’s unaudited Condensed Consolidated Balance Sheets. As of March 31, 2023, the Company has not recognized the remaining $291.6 million liability under the TRA after concluding it was not probable that the Company will be able to realize the remaining tax benefits based on estimates of future taxable income. No payments were made to the Continuing Equity Owners pursuant to the TRA during the three months ended March 31, 2023 and 2022. The estimation of liability under the tax receivable agreement is by its nature imprecise and subject to significant assumptions regarding the amount, character, and timing of the taxable income of Shift4 Payments, Inc. in the future. If the valuation allowance recorded against the deferred tax assets applicable to the tax attributes referenced above is released in a future period, the remaining TRA liability may be considered probable at that time and recorded within earnings. If Rook were to exchange any of its LLC Interests subsequent to March 31, 2023, such exchanges could generate additional deferred tax assets and TRA liability. As of December 31, 2022, the estimated impact of the exchange of all of Rook’s LLC Interests was an additional deferred tax asset of approximately $457.3 million and a TRA liability of approximately $388.7 million. The actual amounts as of March 31, 2023 could differ materially from those disclosed as of December 31, 2022 as they are impacted by the timing of the exchanges, the valuation of corporate subsidiaries, the price of the Company’s shares of Class A common stock at the time of the exchange, and the tax rates then in effect.
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Lease Agreements |
3 Months Ended |
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Mar. 31, 2023 | |
Leases [Abstract] | |
Lease Agreements | Lease Agreements As Lessor The Company provides hardware, including terminals and point-of-sale equipment, to its merchants under operating leases. The Company’s operating leases generally include options to extend the contract for successive one-year periods. Extension options are not included in the determination of lease income unless, at lease inception, it is reasonably certain that the option will be exercised. The Company’s operating leases do not generally include purchase options. Lease payments received are recognized as income on a straight-line basis over the term of the agreement in accordance with ASC 606 and classified as gross revenue on the Company’s unaudited Condensed Consolidated Statements of Operations. Total lease income for the three months ended March 31, 2023 and 2022 was $5.3 million and $4.3 million, respectively. Variable lease income was not material for the three months ended March 31, 2023 or 2022. The Company expects to receive future minimum lease payments for hardware provided under the Company’s SaaS agreements of $11.8 million from April 1, 2023 through March 31, 2024. See Note 3 and Note 9 for more information on the accounting for these operating leases.
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Lease Agreements | Lease Agreements As Lessor The Company provides hardware, including terminals and point-of-sale equipment, to its merchants under operating leases. The Company’s operating leases generally include options to extend the contract for successive one-year periods. Extension options are not included in the determination of lease income unless, at lease inception, it is reasonably certain that the option will be exercised. The Company’s operating leases do not generally include purchase options. Lease payments received are recognized as income on a straight-line basis over the term of the agreement in accordance with ASC 606 and classified as gross revenue on the Company’s unaudited Condensed Consolidated Statements of Operations. Total lease income for the three months ended March 31, 2023 and 2022 was $5.3 million and $4.3 million, respectively. Variable lease income was not material for the three months ended March 31, 2023 or 2022. The Company expects to receive future minimum lease payments for hardware provided under the Company’s SaaS agreements of $11.8 million from April 1, 2023 through March 31, 2024. See Note 3 and Note 9 for more information on the accounting for these operating leases.
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Related Party Transactions |
3 Months Ended |
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Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company has a service agreement with Jared Isaacman, the Company’s Chief Executive Officer and founder (“Founder”), including access to aircrafts and a property. Total expense for this service, which is included in “General and administrative expenses” in the Company’s unaudited Condensed Consolidated Statements of Operations, was $0.2 million for the three months ended both March 31, 2023 and 2022. There were no amounts outstanding at March 31, 2023 or December 31, 2022. In addition, during the three months ended March 31, 2023, the Company made $1.4 million of distributions related to income taxes paid on behalf of Rook, which are included in “Distributions to noncontrolling interests” in the Company’s unaudited Condensed Consolidated Statements of Cash Flows. In November 2021, the Company implemented a one-time discretionary equity award program for non-management employees. The Founder agreed to fund 50% of this program through a contribution of shares of his Class C common stock. As of March 31, 2023, the expected contribution from the Founder totaled 767,748 shares of his Class C common stock. The one-time discretionary equity award program will vest in three equal installments annually beginning in the third year. Vesting of the awards is subject to the continued employment of non-management employees. Rook has entered into margin loan agreements, pursuant to which, in addition to other collateral, it has pledged LLC Interests and shares of the Company’s Class A and Class B common stock (collectively, “Rook Units”) to secure a margin loan. If Rook were to default on its obligations under the margin loan and fail to cure such default, the lender would have the right to exchange and sell up to 15,000,000 Rook units to satisfy Rook’s obligation. In March 2021, the Founder, through a wholly-owned special purpose vehicle (“SPV”), entered into a variable prepaid forward contract (“VPF Contract”) with an unaffiliated dealer (“Dealer”), covering approximately 2.0 million shares of the Company’s Class A common stock. The VPF Contract settles on specified dates in February, March and April 2023, at which time the actual number of shares of the Company’s Class A common stock to be delivered by the SPV will be determined based on the price of the Company’s Class A common stock on such dates relative to the forward floor price of $73.19 per share and the forward cap price of $137.24 per share, with the aggregate number not to exceed approximately 2.0 million shares, which is the number of shares of the Company’s Class B common stock and LLC units pledged by Rook to secure its obligations under the contract. Subject to certain conditions, the SPV can also elect to settle the VPF Contract in cash and thereby retain full ownership of the pledged shares and units. During the three months ended March 31, 2023, 1,666,665 shares of the Company’s Class B common stock owned by the SPV were effectively converted to Class A common stock and delivered to the SPV through the VPF Contract. In September 2021, the Founder, through the SPV, entered into two VPF Contracts with a Dealer, one covering approximately 2.18 million shares of the Company’s Class A common stock and the other covering approximately 2.26 million shares of the Company’s Class A common stock. The VPF Contracts are both scheduled to settle on specified dates in June, July, August and September 2024, at which time the actual number of shares of the Company’s Class A common stock to be delivered by the SPV will be determined based on the price of the Company’s Class A common stock on such dates relative to the forward floor price of approximately $66.424 per share and the forward cap price of approximately $112.09 per share for the contract covering approximately 2.18 million shares of the Company’s Class A common stock, and to the forward floor price of $66.424 per share and the forward cap price of approximately $120.39 per share for the contract covering approximately 2.26 million shares of the Company’s Class A common stock, with the aggregate number not to exceed approximately 4.44 million shares, which is the aggregate number of shares of Company’s Class B common stock and their associated common units of Shift4 Payments, LLC pledged by the SPV to secure its obligations under the contracts. Subject to certain conditions, the SPV can also elect to settle the VPF Contracts in cash and thereby retain full ownership of the pledged shares and units. If Rook were to default on its obligations under the VPF Contracts and fail to cure such default, the Dealer would have the right to exchange the pledged Class B stock and LLC interests for an equal number of the Company’s Class A common stock, and sell such Class A common stock to satisfy Rook’s obligation.
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Commitments and Contingencies |
3 Months Ended |
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Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies From time to time, the Company may become involved in various lawsuits and legal proceedings, which arise, in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these, or other matters, may arise from time to time that may harm the Company’s business. In August 2021, TSYS, a Global Payments company and an important vendor to the Company, experienced a significant platform outage resulting in a payment processing service disruption that lasted for several hours. TSYS is utilized by many major credit card issuers and payment processors, which meant the impact of the outage was felt by many card-accepting merchants and cardholders across the nation. The Company took steps to lessen the financial impact to its merchants and partners due to the TSYS outage and is seeking compensation through a variety of channels, including engaging with the responsible party. The Company is currently not aware of any legal proceedings or claims that the Company believes will have a material adverse effect on its business, financial condition or operating results.
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Stockholders’ Equity |
3 Months Ended |
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Mar. 31, 2023 | |
Equity [Abstract] | |
Stockholders’ Equity | Stockholders’ Equity Stock Repurchases In 2021 and 2022, the Company’s Board of Directors (the “Board”) authorized three sequential stock repurchase programs (the “Programs”), pursuant to which the Company was authorized to repurchase up to an aggregate of $250.0 million of shares of its Class A common stock through December 31, 2022. Repurchases under the Programs were able to be made in the open market, in privately negotiated transactions or otherwise, with the amount and timing of repurchases depending on market conditions and corporate needs. Open market repurchases were structured to occur within the pricing and volume requirements of Rule 10b-18. The third of these Programs expired on December 31, 2022. During the three months ended March 31, 2022, the Company repurchased 301,510 shares of Class A common stock under the Programs for $17.2 million, including commissions paid, at an average price paid of $56.78 per share. Repurchased shares of common stock that have not been retired are recorded as “Treasury stock” on the Company’s unaudited Condensed Consolidated Balance Sheets. Upon retirement, the Company allocates the value of treasury stock between Additional paid-in capital and Retained earnings. There were no shares of treasury stock outstanding as of March 31, 2023 or December 31, 2022.
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Noncontrolling Interests |
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Noncontrolling Interests | Noncontrolling Interests Shift4 Payments, Inc. is the sole managing member of Shift4 Payments, LLC, and consolidates the financial results of Shift4 Payments, LLC. The noncontrolling interests balance represents the economic interest in Shift4 Payments, LLC held by Rook. The following table summarizes the ownership of LLC Interests in Shift4 Payments, LLC:
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Equity-based Compensation |
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Equity-based Compensation | Equity-based Compensation 2020 Incentive Award Plan The Company’s 2020 Incentive Award Plan, as amended and restated in June 2022 (the “Restated Equity Plan”), provides for the grant of stock options, restricted stock dividend equivalents, stock payments, restricted stock units (“RSUs”), performance restricted stock units (“PRSUs”), stock appreciation rights, and other stock or cash awards. The number of shares available for issuance is subject to an annual increase on the first day of each year beginning in 2023 and ending in and including 2032, equal to the lesser of (1) 2% of the shares outstanding (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable or redeemable for, shares of Class A common stock (including LLC Interests of Shift4 Payments, LLC)) on the last day of the immediately preceding fiscal year and (2) such smaller number of shares as determined by the Board. As of March 31, 2023, a maximum of 721,911 shares of the Company’s Class A common stock were available for issuance under the Restated Equity Plan. RSUs and PRSUs RSUs represent the right to receive shares of the Company’s Class A common stock at a specified date in the future. The RSU activity for the three months ended March 31, 2023 was as follows:
The grant date fair value of RSUs and PRSUs subject to continued service or those that vest immediately was determined based on the price of the Company’s Class A common stock on the grant date (or, in the case of the RSUs granted in connection with the IPO, the IPO price of $23.00 per share). The grant date fair value of the RSUs issued in connection with the IPO, that are not subject to continued service, was determined using the Finnerty discount for lack of marketability pricing model, taking into account the vesting provisions on the shares prior to June 2021. The Company recognized equity-based compensation expense of $20.9 million and $16.9 million for the three months ended March 31, 2023 and 2022, respectively. As of March 31, 2023, the Company had $139.7 million of total unrecognized equity-based compensation expense related to outstanding RSUs and PRSUs, which is expected to be recognized over a weighted-average period of 3.27 years.
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Basic and Diluted Net Income (Loss) per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and Diluted Net Income (Loss) per Share | Basic and Diluted Net Income (Loss) per Share Basic net income (loss) per share has been computed by dividing net income (loss) attributable to common shareholders by the weighted average number of shares of common stock outstanding for the same period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period in which the shares were outstanding. Diluted net income (loss) per share has been computed in a manner consistent with that of basic net income (loss) per share while giving effect to all shares of potentially dilutive common stock that were outstanding during the period. The following table presents the calculation of basic and diluted net income (loss) per share under the two-class method:
The following were excluded from the calculation of diluted net income (loss) per share as the effect would be anti-dilutive:
For the three months ended March 31, 2023, the Company has excluded from the calculation of diluted net income per share the effect of the following: •the conversion of the 2025 Convertible Notes and 2027 Convertible Notes, as the last reported sales price of the Company’s Class A common stock was not greater than or equal to 130% of the conversion price for 20 trading days during a period of 30 consecutive trading days prior to March 31, 2023, per the terms of the agreement, and •shares of the Company’s Class A common stock to be issued in connection with the earnouts due to the former shareholders of Online Payments Group and certain restaurant technology partners. See Note 2 for more information about shares to be issued in connection with earnouts. For the three months ended March 31, 2022, the Company has excluded from the calculation of diluted net loss per share the effect of the following: •the conversion of the 2025 Convertible Notes and 2027 Convertible Notes, as the last reported sales price of the Company’s Class A common stock was not greater than or equal to 130% of the conversion price for 20 trading days during a period of 30 consecutive trading days prior to March 31, 2022, per the terms of the agreement, and •shares of the Company’s Class A common stock to be issued in connection with the earnout due to the former shareholders of The Giving Block. See Note 2 for more information about shares to be issued in connection with earnouts. The Company will pay in cash the $690.0 million principal of the 2025 Convertible Notes and the $632.5 million principal of the 2027 Convertible Notes with any excess to be paid or delivered in cash or shares of the Company’s Class A common stock or a combination of both at the Company’s election.
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Supplemental Cash Flow Information |
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Supplemental Cash Flow Information [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information | Supplemental Cash Flows Information Supplemental cash flows disclosures and noncash information consisted of the following:
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Segments |
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segments | Segments Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”) for the purposes of allocating resources and evaluating financial performance. The Company’s CODM is the chief executive officer, who reviews financial information on a consolidated level for purposes of allocating resources and evaluating financial performance, and as such, the Company’s operations constitute one operating segment and one reportable segment. The following table summarizes gross revenue by revenue type:
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Subsequent Events |
3 Months Ended |
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Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Acquisition Subsequent to March 31, 2023, the Company acquired Focus POS Systems for $45.0 million of total purchase consideration, comprised of $35.0 million of cash and $10.0 million of shares of the Company’s Class A common stock. Due to the timing of this acquisition, the initial accounting for the acquisition, including the valuation of assets and liabilities acquired, is incomplete. As such, the Company is unable to disclose certain information, including the preliminary fair value of assets acquired and liabilities assumed, at this time. Material Agreements Prior to an amendment to the Company’s agreement with its sponsor bank, as discussed in Note 1, Settlement Funds to facilitate gross card transaction deposits for those customers the Company bills on a monthly, versus a daily basis funds were deposited at the sponsor bank and included within “Accounts receivable, net” on the Company’s unaudited Condensed Consolidated Balance Sheets prior to December 2022. In April 2023, the Company finalized an amendment which established a new long-term agreement with its sponsor bank, which augments services and expands tiered pricing that lowers the Company’s cost as transaction volume increases. The agreement also establishes by what means the Company’s cash will be restricted based on settlement activity flows. Under this agreement, the Company is required to maintain an account in the Company’s name at the sponsor bank, with a minimum balance equal to the greater of $25.0 million or 110% of the highest merchant settlement account overdraft balance over a rolling 90-day period. This amount will fluctuate based on end-to-end payment volumes and the timing of billing cycles and will be recognized as “Restricted cash” on the Company’s unaudited Condensed Consolidated Balance Sheets. Stock Repurchase Program On May 3, 2023, the Board authorized a new stock repurchase program (the “May 2023 Program”), pursuant to which the Company is authorized to repurchase up to $250.0 million of shares of its Class A common stock through December 31, 2023. Repurchases under the May 2023 Program may be made in the open market, in privately negotiated transactions or otherwise, with the amount and timing of repurchases depending on market conditions and corporate needs. Open market repurchases will be structured to occur within the pricing and volume requirements of Rule 10b-18. The Company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares pursuant to the May 2023 Program. The May 2023 Program does not obligate the Company to acquire any particular amount of common stock. The May 2023 Program may be extended, modified, suspended or discontinued at any time at the Company’s discretion.
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Organization, Basis of Presentation and Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim condensed consolidated financial statements of the Company are unaudited. These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the U.S. (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial information. As such, these financial statements do not include all information and footnotes required by U.S. GAAP for complete financial statements. The December 31, 2022 Condensed Consolidated Balance Sheet was derived from audited financial statements as of that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments consisting only of normal recurring adjustments necessary to state fairly the financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP applicable to interim periods. The results of operations for the interim periods presented are not necessarily indicative of results for the full year or future periods. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto as of and for the fiscal year ended December 31, 2022, as disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the “2022 Form 10-K”). The unaudited condensed consolidated financial statements include the accounts of Shift4 Payments, Inc. and its wholly-owned subsidiaries. Shift4 Payments, Inc. consolidates the financial results of Shift4 Payments, LLC, which is considered a variable interest entity. Shift4 Payments, Inc. is the primary beneficiary and sole managing member of Shift4 Payments, LLC and has decision making authority that significantly affects the economic performance of the entity. As a result, the Company consolidates Shift4 Payments, LLC and reports a noncontrolling interest representing the economic interest in Shift4 Payments, LLC held by Rook Holdings Inc. (“Rook”). All intercompany balances and transactions have been eliminated in consolidation. The assets and liabilities of Shift4 Payments, LLC represent substantially all of the consolidated assets and liabilities of Shift4 Payments, Inc. with the exception of certain cash balances, contingent consideration for earnout liabilities for The Giving Block, Inc. (“The Giving Block”), amounts payable under the Tax Receivable Agreement (“TRA”), and the aggregate principal amount of $690.0 million of 2025 Convertible Notes and $632.5 million of 2027 Convertible Notes (together, the “Convertible Notes”) that are held by Shift4 Payments, Inc. directly. As of March 31, 2023 and December 31, 2022, $12.3 million and $9.8 million of cash, respectively, was directly held by Shift4 Payments, Inc. As of March 31, 2023 and December 31, 2022, the earnout liability for The Giving Block was $2.9 million and $10.9 million, respectively. The $2.9 million liability as of March 31, 2023 represents the cash portion of the earnout, which is expected to be paid in the second quarter of 2023. As of March 31, 2023 and December 31, 2022, the TRA liability was $2.2 million and $1.7 million, respectively. In connection with the issuance of the Convertible Notes, Shift4 Payments, Inc. entered into Intercompany Convertible Notes with Shift4 Payments, LLC, whereby Shift4 Payments, Inc. provided the net proceeds from the issuance of the Convertible Notes to Shift4 Payments, LLC in the amount of $1,322.5 million. Shift4 Payments, Inc., which was incorporated on November 5, 2019, has not had any material operations on a standalone basis since its inception, and all of the operations of the Company are carried out by Shift4 Payments, LLC and its subsidiaries. Shift4 Payments, Inc. recognized fair value adjustments to the contingent liability for The Giving Block of $(0.5) million for the three months ended March 31, 2023 due to the final measurement of the earnout payment.
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Change in Presentation of Unaudited Condensed Consolidated Balance Sheets and Statements of Operations | Change in Presentation of Unaudited Condensed Consolidated Balance Sheets Certain prior year balances have been adjusted to present “Restricted cash” on its own line item rather than within “Cash and cash equivalents” on the Company’s unaudited Condensed Consolidated Balance Sheets to conform to the current period presentation. Change in Presentation of Unaudited Condensed Consolidated Statements of Operations Certain prior year balances have been adjusted to present “Transaction-related expenses” within “Professional fees” rather than its own line item on the Company’s unaudited Condensed Consolidated Statements of Operations.
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Liquidity and Managements Plan | Liquidity and Management’s Plan As of March 31, 2023, the Company had $1,772.5 million total principal amount of debt outstanding and was in compliance with the financial covenants under its debt agreements. The Company expects to be in compliance with such financial covenants for at least 12 months following the issuance of these unaudited condensed consolidated financial statements. See Note 11 for further information on the Company’s debt obligations.
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Use of Estimates | Use of EstimatesThe preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s unaudited condensed consolidated financial statements and accompanying notes. Significant estimates inherent in the preparation of the accompanying unaudited condensed consolidated financial statements include estimates of fair value of acquired assets and liabilities through business combinations, fair value of contingent liabilities related to earnout payments, deferred income tax valuation allowances, amounts associated with the Company’s tax receivable agreement with Rook and certain affiliates of Searchlight Capital Partners (together, the “Continuing Equity Owners”), fair value of debt instruments, allowance for doubtful accounts, income taxes, investments in securities and noncontrolling interests. Estimates are based on past experience and other considerations reasonable under the circumstances. Actual results may differ from these estimates. |
Significant Accounting Policies | Significant Accounting Policies The Company’s significant accounting policies are discussed in Note 2 to Shift4 Payments, Inc.’s consolidated financial statements as of and for the year ended December 31, 2022 in the 2022 Form 10-K. There have been no significant changes to these policies which have had a material impact on the Company’s unaudited condensed consolidated financial statements and related notes during the three months ended March 31, 2023, except for the below.
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Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash Highly liquid investments with maturities of three months or less at the date of purchase are considered to be cash equivalents and are stated at cost, which approximates fair value. The Company’s cash equivalents consist of highly liquid investments in money market funds, which amounted to $672.2 million and $652.8 million as of March 31, 2023 and December 31, 2022, respectively. The Company classifies as restricted certain cash that is not available for use in its operations. Prior to December 2022, the Company had funds deposited in a sponsor bank merchant settlement account (“Settlement Funds”) to facilitate gross card transaction deposits for those customers the Company bills on a monthly, versus a daily basis. This amount fluctuates based upon end-to-end payment volumes and timing of billing cycles. The funds deposited at the sponsor bank were included within “Accounts receivable, net” prior to December 2022. In December 2022 and March 2023, pursuant to amendments to its agreement, the Company received in cash its Settlement Funds of $74.0 million, which was restricted as to withdrawal by the sponsor bank. In January 2023 and April 2023, the Company, as required by the amendments, deposited $74.0 million to its sponsor bank merchant settlement account. See Note 24 for more information on the April 2023 amendment to the sponsor bank agreement. As of both March 31, 2023 and December 31, 2022, Restricted cash was $74.0 million, representing the Company’s Settlement Funds. The Company maintains its cash with what are widely considered to be high credit quality financial institutions. The total cash balances insured by the Federal Deposit Insurance Corporation are up to $250 thousand per bank.
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Cash and Cash Equivalents and Restricted Cash | Cash and Cash Equivalents and Restricted Cash Highly liquid investments with maturities of three months or less at the date of purchase are considered to be cash equivalents and are stated at cost, which approximates fair value. The Company’s cash equivalents consist of highly liquid investments in money market funds, which amounted to $672.2 million and $652.8 million as of March 31, 2023 and December 31, 2022, respectively. The Company classifies as restricted certain cash that is not available for use in its operations. Prior to December 2022, the Company had funds deposited in a sponsor bank merchant settlement account (“Settlement Funds”) to facilitate gross card transaction deposits for those customers the Company bills on a monthly, versus a daily basis. This amount fluctuates based upon end-to-end payment volumes and timing of billing cycles. The funds deposited at the sponsor bank were included within “Accounts receivable, net” prior to December 2022. In December 2022 and March 2023, pursuant to amendments to its agreement, the Company received in cash its Settlement Funds of $74.0 million, which was restricted as to withdrawal by the sponsor bank. In January 2023 and April 2023, the Company, as required by the amendments, deposited $74.0 million to its sponsor bank merchant settlement account. See Note 24 for more information on the April 2023 amendment to the sponsor bank agreement. As of both March 31, 2023 and December 31, 2022, Restricted cash was $74.0 million, representing the Company’s Settlement Funds. The Company maintains its cash with what are widely considered to be high credit quality financial institutions. The total cash balances insured by the Federal Deposit Insurance Corporation are up to $250 thousand per bank.
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Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Pronouncements Not Yet Adopted In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform, which provides optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships, subject to certain criteria, that reference the London Interbank Offered Rate (“LIBOR”), or another reference rate that is expected to be discontinued. ASU 2020-04 was subsequently amended by ASU 2022-06, Reference Rate Reform, which extends the date through which entities can elect these optional expedients and exceptions. Companies may elect to apply these amendments as of March 12, 2020 through December 31, 2024. The Company is currently evaluating whether it will elect the optional expedients, as well as evaluating the impact of ASU 2020-04 on the Company’s unaudited condensed consolidated financial statements. In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, to clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring the fair value of the equity security. ASU 2022-03 also clarifies that an entity cannot recognize and measure a contractual sale restriction as a separate unit of account. The amendments in ASU 2022-03 may be early adopted and are effective on a prospective basis for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The Company currently considers sale restrictions in measuring the fair value of shares of its Class A common stock equity securities issued in conjunction with acquisitions. The Company is currently evaluating whether it will early adopt the amendments in ASU 2022-03 and is evaluating the impact of the amendments on the Company’s unaudited condensed consolidated financial statements.
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Acquisitions (Tables) |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Purchase Price Included the Forms of Consideration | Total purchase consideration was as follows:
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Schedule of Assets Acquired and Liabilities Assumed | The following table summarizes the fair value assigned to the assets acquired and liabilities assumed at the acquisition date. These amounts reflect various preliminary fair value estimates and assumptions, and are subject to change within the measurement period as valuations are finalized. The primary areas of preliminary purchase price allocation subject to change relate to the valuation of contingent consideration, accounts receivable, accrued expenses and other current liabilities assumed, and residual goodwill.
The following table summarizes the fair value assigned to the assets acquired and liabilities assumed at the acquisition date:
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Revenue (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disaggregation of Revenue | Based on similar operational characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
Based on similar economic characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
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Summary of Annual Service Fees and Regulatory Compliance Fees | The following reflects the amounts the Company recognized as annual service fees and regulatory compliance fees within “Gross revenue” in the Company’s unaudited Condensed Consolidated Statements of Operations and the amount of such fees that were included in deferred revenue at the beginning of each respective period:
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Schedule of Changes in Allowance for Doubtful Accounts | The change in the Company’s allowance for doubtful accounts was as follows:
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Goodwill (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill were as follows:
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Depreciation and Amortization (Tables) |
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Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Depreciation and Amortization | Amounts charged to expense in the Company’s unaudited Condensed Consolidated Statements of Operations for depreciation and amortization were as follows:
(a) Total amortization of $38.9 million consisted of amortization of acquired intangibles of $30.0 million and amortization of non-acquired intangibles of $8.9 million. (b) Total amortization of $20.8 million consisted of amortization of acquired intangibles of $12.5 million and amortization of non-acquired intangibles of $8.3 million.
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Schedule of Estimated Amortization Expense for Intangible Assets | As of March 31, 2023, the estimated amortization expense for each of the five succeeding years and thereafter is as follows:
|
Residual Commission Buyouts (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Residual Commission Buyouts | Residual commission buyouts, net consisted of the following:
|
Other Intangible Assets, Net (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Intangible Assets, Net | Other intangible assets, net consisted of the following:
|
Equipment for Lease, Net (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Equipment for Lease, Net | Equipment for lease, net consisted of the following:
|
Property, Plant and Equipment, Net (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Property, Plant and Equipment, Net | Property, plant and equipment, net consisted of the following:
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Debt (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Outstanding Debt | The Company’s outstanding debt consisted of the following:
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Schedule of Maturities of Long-term Debt | As of March 31, 2023, future principal payments associated with the Company’s long-term debt were as follows:
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Schedule of Long-Term Debt Instruments | The net carrying amount of the Convertible Senior Notes due 2025 (“2025 Convertible Notes”) was as follows:
The net carrying amount of the 4.625% Senior Notes due 2026 (“2026 Senior Notes”) was as follows:
The net carrying amount of the 0.50% Convertible Senior Notes due 2027 (“2027 Convertible Notes”) was as follows:
|
Other Consolidated Balance Sheet Components (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Consolidated Balance Sheet Components [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following:
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Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following:
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Schedule of Other Noncurrent Assets | Other noncurrent assets consisted of the following:
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Schedule of Other Noncurrent Liabilities | Other noncurrent liabilities consisted of the following:
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Fair Value Measurement (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Beginning and Ending Balances for Level 3 Contingent Liabilities | The table below provides a reconciliation of the beginning and ending balances for the Level 3 contingent liabilities:
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Summary of Estimated Fair Value | The estimated fair value of the Company’s outstanding debt using quoted prices from over-the-counter markets, considered Level 2 inputs, was as follows:
|
Noncontrolling Interests (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Ownership of LLC Interests |
|
Equity-based Compensation (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-Based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of RSU Activity | The RSU activity for the three months ended March 31, 2023 was as follows:
|
Basic and Diluted Net Income (Loss) per Share (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Calculation of Basic and Diluted Net Loss Per Share | Basic net income (loss) per share has been computed by dividing net income (loss) attributable to common shareholders by the weighted average number of shares of common stock outstanding for the same period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period in which the shares were outstanding. Diluted net income (loss) per share has been computed in a manner consistent with that of basic net income (loss) per share while giving effect to all shares of potentially dilutive common stock that were outstanding during the period. The following table presents the calculation of basic and diluted net income (loss) per share under the two-class method:
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Schedule of Calculation of Diluted Net Loss Per Share as the Effect Would be Anti-dilutive | The following were excluded from the calculation of diluted net income (loss) per share as the effect would be anti-dilutive:
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Supplemental Cash Flow Information (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Supplemental Cash Flows and Noncash Information | Supplemental cash flows disclosures and noncash information consisted of the following:
|
Segments (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Gross Revenue by Revenue | The following table summarizes gross revenue by revenue type:
|
Organization, Basis of Presentation and Significant Accounting Policies (Details) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Nov. 05, 2019 |
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||
Cash | $ 12,300,000 | $ 9,800,000 | ||
Tax receivable agreement recognized liability | 2,200,000 | 1,700,000 | ||
Revaluation of contingent liabilities | 7,000,000.0 | $ 0 | ||
Total borrowings | 1,772,500,000 | 1,772,500,000 | ||
Cash equivalents | 672,200,000 | 652,800,000 | ||
Restricted cash | 74,000,000 | 74,000,000.0 | ||
The Giving Block | ||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||
Contingent liability earnouts | 2,900,000 | 10,900,000 | ||
Tax receivable agreement recognized liability | 2,200,000 | $ 1,700,000 | ||
Revaluation of contingent liabilities | (500,000) | |||
Senior Notes Due 2025 | ||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||
Debt instrument, face amount | 690,000,000 | |||
2027 Convertible Notes | Convertible Debt | ||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||
Debt instrument, face amount | 632,500,000 | |||
Convertible Notes Due 2025 and Convertible Notes Due 2027 | ||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||
Proceeds from 2025 notes offering | $ 1,322,500,000 | |||
First Lien Term Loan Facility | ||||
Organization Consolidation And Presentation Of Financial Statements [Line Items] | ||||
Total borrowings | $ 1,772,500,000 |
Acquisitions - Narrative (Details) $ in Millions |
12 Months Ended | 13 Months Ended | |||
---|---|---|---|---|---|
Jan. 20, 2023
USD ($)
vendor
|
Sep. 29, 2022
USD ($)
|
Feb. 28, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
vendor
|
Jan. 20, 2023
USD ($)
|
|
Online Payments Group | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, percentage of voting interests acquired | 100.00% | ||||
Business combination, consideration transferred | $ 125.9 | ||||
Uncertain tax position | 6.7 | ||||
Indemnification asset, contingencies | 1.8 | ||||
Indemnification asset | $ 7.5 | ||||
Online Payments Group | Developed Technology | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 8 years | ||||
Online Payments Group | Customer Relationships | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 13 years | ||||
2022 Restaurant Technology Partner | |||||
Business Acquisition [Line Items] | |||||
Business combination, consideration transferred | $ 80.3 | ||||
Number of vendors acquired | vendor | 3 | ||||
2023 Restaurant Technology Partner | |||||
Business Acquisition [Line Items] | |||||
Business combination, consideration transferred | $ 1.5 | ||||
Number of vendors acquired | vendor | 1 | ||||
Restaurant Technology Partners | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, percentage of voting interests acquired | 100.00% | ||||
Business combination, consideration transferred | $ 81.8 | ||||
Restaurant Technology Partners | Customer Relationships | Minimum | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 6 years | ||||
Restaurant Technology Partners | Customer Relationships | Maximum | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 14 years | ||||
Restaurant Technology Partners | Residual commission buyouts from asset acquisitions | Minimum | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 5 years | ||||
Restaurant Technology Partners | Residual commission buyouts from asset acquisitions | Maximum | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 9 years | ||||
The Giving Block | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, percentage of voting interests acquired | 100.00% | ||||
Business combination, consideration transferred | $ 106.9 | ||||
The Giving Block | Developed Technology | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 8 years | ||||
The Giving Block | Trademarks and trade names | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 15 years | ||||
The Giving Block | Donor Relationships | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 5 years | ||||
The Giving Block | Customer Relationships | |||||
Business Acquisition [Line Items] | |||||
Weighted average life | 15 years |
Acquisitions - Schedule of Purchase Price Included the Forms of Consideration (Details) - USD ($) $ in Millions |
3 Months Ended | 12 Months Ended | 13 Months Ended | ||||
---|---|---|---|---|---|---|---|
Jan. 20, 2023 |
Sep. 29, 2022 |
Feb. 28, 2022 |
Mar. 31, 2023 |
Dec. 31, 2022 |
Jan. 20, 2023 |
Mar. 31, 2022 |
|
Business Acquisition [Line Items] | |||||||
Contingent consideration | $ 0.3 | $ 57.8 | |||||
Contingent liability earnouts, noncurrent | 13.8 | $ 10.3 | |||||
Online Payments Group | |||||||
Business Acquisition [Line Items] | |||||||
Cash | $ 74.1 | ||||||
Shares of Class A common stock | 38.6 | ||||||
Contingent consideration | 22.0 | 40.2 | |||||
Shareholder loans transfer | 2.5 | ||||||
Total purchase consideration | 137.2 | ||||||
Less: cash acquired | (11.3) | ||||||
Total purchase consideration, net of cash acquired | $ 125.9 | ||||||
Business acquisition, number of shares issued (in shares) | 971,371 | ||||||
Contingent consideration, maximum earnout | $ 60.0 | ||||||
Contingent consideration, earnout to be paid year one | 30.0 | ||||||
Contingent consideration, earnout to be paid year two | $ 30.0 | ||||||
Contingent consideration, cash, earnout percentage | 50.00% | ||||||
Online Payments Group | Accrued Expenses and Other Current Liabilities | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration | 28.0 | ||||||
Online Payments Group | Other Noncurrent Liabilities | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration | 12.2 | ||||||
Online Payments Group | Tranche One | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration, equity interests issued and issuable, earnout percentage | 50.00% | ||||||
Online Payments Group | Tranche Two | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration, equity interests issued and issuable, earnout percentage | 50.00% | ||||||
Restaurant Technology Partners | |||||||
Business Acquisition [Line Items] | |||||||
Cash | $ 65.1 | ||||||
Shares of Class A common stock | 20.7 | ||||||
Settlement of preexisting relationship | (2.5) | ||||||
Contingent consideration | $ 2.5 | 2.5 | |||||
Total purchase consideration | 85.8 | ||||||
Less: cash acquired | (4.0) | ||||||
Total purchase consideration, net of cash acquired | $ 81.8 | ||||||
Business acquisition, number of shares issued (in shares) | 598,759 | ||||||
2022 Restaurant Technology Partner | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration | 1.8 | ||||||
Total purchase consideration, net of cash acquired | 80.3 | ||||||
Contingent consideration, maximum earnout | $ 4.0 | ||||||
Contingent consideration, earnout period | 18 months | ||||||
Contingent liability earnouts, current | 0.5 | ||||||
Contingent liability earnouts, noncurrent | 1.3 | ||||||
2023 Restaurant Technology Partner | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration | 0.3 | ||||||
Total purchase consideration, net of cash acquired | 1.5 | ||||||
Contingent consideration, maximum earnout | $ 2.5 | ||||||
The Giving Block | |||||||
Business Acquisition [Line Items] | |||||||
Cash | $ 16.8 | ||||||
Contingent consideration | 57.8 | ||||||
Total purchase consideration | 111.1 | ||||||
Less: cash acquired | (4.2) | ||||||
Total purchase consideration, net of cash acquired | $ 106.9 | ||||||
Business acquisition, number of shares issued (in shares) | 785,969 | ||||||
Contingent consideration, maximum earnout | 246.0 | ||||||
Acquisition cost expensed | $ 10.2 | ||||||
Contingent consideration, equity interests issued and issuable, earnout percentage | 75.00% | ||||||
Contingent consideration, cash, earnout percentage | 25.00% | ||||||
Contingent liability earnouts, current | $ 2.9 | $ 10.9 | |||||
Contingent liability earnouts, noncurrent | $ 7.3 | ||||||
The Giving Block | RSUs | |||||||
Business Acquisition [Line Items] | |||||||
RSUs granted for fair value of equity-based compensation awards | $ 0.1 | ||||||
The Giving Block | Class A Common Stock | |||||||
Business Acquisition [Line Items] | |||||||
Shares of Class A common stock | $ 36.4 |
Acquisitions - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
Sep. 29, 2022 |
Feb. 28, 2022 |
---|---|---|---|---|
Business Acquisition [Line Items] | ||||
Goodwill | $ 737.0 | $ 735.0 | ||
Crypto settlement assets | 3.2 | 1.8 | $ 4.8 | |
Crypto settlement liabilities | $ 3.2 | 1.8 | 4.8 | |
Online Payments Group | ||||
Business Acquisition [Line Items] | ||||
Accounts receivable | $ 2.2 | |||
Shareholder loan receivable | 2.5 | |||
Goodwill | 49.9 | |||
Other intangible assets | 84.0 | |||
Indemnification asset | 7.5 | |||
Accounts payable | (0.4) | |||
Accrued expenses and other current liabilities | (1.4) | |||
Uncertain tax position | (6.7) | |||
Deferred tax liability | (9.9) | |||
Other noncurrent liabilities | (1.8) | |||
Net assets acquired | $ 125.9 | |||
Restaurant Technology Partners | ||||
Business Acquisition [Line Items] | ||||
Accounts receivable | 1.2 | |||
Inventory | 1.2 | |||
Prepaid expenses and other current assets | 0.3 | |||
Goodwill | 54.3 | |||
Other intangible assets | 20.8 | |||
Property, plant and equipment | 0.2 | |||
Right-of-use assets | 1.3 | |||
Accounts payable | (2.7) | |||
Accrued expenses and other current liabilities | (0.8) | |||
Deferred revenue | (1.9) | |||
Current lease liabilities | (0.5) | |||
Deferred tax liability | (3.5) | |||
Noncurrent lease liabilities | (0.8) | |||
Net assets acquired | 81.8 | |||
Goodwill, expected tax deductible amount | 27.7 | |||
Goodwill, non expected tax deductible amount | 26.6 | |||
Restaurant Technology Partners | Residual commission buyouts | ||||
Business Acquisition [Line Items] | ||||
Other intangible assets | $ 12.7 | |||
The Giving Block | ||||
Business Acquisition [Line Items] | ||||
Prepaid expenses and other current assets | 4.8 | |||
Goodwill | 89.4 | |||
Other intangible assets | 26.0 | |||
Accrued expenses and other current liabilities | (4.9) | |||
Deferred revenue | (2.0) | |||
Deferred tax liability | (6.4) | |||
Net assets acquired | $ 106.9 |
Revenue - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Revenue from Contract with Customer [Abstract] | ||
Fee recognition period | 1 year | |
Deferred revenue | $ 23.3 | $ 19.1 |
Revenue - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation Of Revenue [Line Items] | ||
Revenue from contracts with customers | $ 547.0 | $ 401.9 |
Over-time revenue | ||
Disaggregation Of Revenue [Line Items] | ||
Revenue from contracts with customers | 538.2 | 392.0 |
Point-in-time revenue | ||
Disaggregation Of Revenue [Line Items] | ||
Revenue from contracts with customers | 8.8 | 9.9 |
Payments-based revenue | ||
Disaggregation Of Revenue [Line Items] | ||
Revenue from contracts with customers | 511.0 | 371.5 |
Subscription and other revenues | ||
Disaggregation Of Revenue [Line Items] | ||
Revenue from contracts with customers | $ 36.0 | $ 30.4 |
Revenue - Summary of Annual Service Fees and Regulatory Compliance Fees (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation Of Revenue [Line Items] | ||
Gross revenue | $ 547.0 | $ 401.9 |
Annual service fees and regulatory compliance fees | ||
Disaggregation Of Revenue [Line Items] | ||
Gross revenue | 10.8 | 9.6 |
Amount of these fees included in deferred revenue at beginning of period | ||
Disaggregation Of Revenue [Line Items] | ||
Gross revenue | $ 6.4 | $ 4.9 |
Revenue - Schedule of Changes in Allowance for Doubtful Accounts (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ 18.1 | $ 8.0 |
Additions to expense | 3.2 | 3.0 |
Write-offs, net of recoveries and other adjustments | (1.1) | (1.5) |
Ending balance | $ 20.2 | $ 9.5 |
Goodwill (Details) $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2023
USD ($)
| |
Goodwill [Roll Forward] | |
Balance at December 31, 2022 | $ 735.0 |
Restaurant technology partner acquisition | 1.1 |
Purchase price adjustments related to prior period acquisitions | (0.2) |
Effect of foreign currency translation | 1.1 |
Balance at March 31, 2023 | $ 737.0 |
Depreciation and Amortization - Schedule of Depreciation and Amortization (Details) - USD ($) $ in Millions |
3 Months Ended | |||
---|---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|||
Amortization | ||||
Total depreciation and amortization | $ 38.9 | $ 20.8 | ||
Total | ||||
Depreciation and amortization expense | [1] | 35.3 | 17.3 | |
Cost of sales | 12.3 | 11.8 | ||
Total depreciation and amortization | 47.6 | 29.1 | ||
Equipment Under Lease | ||||
Depreciation | ||||
Depreciation and amortization expense | 7.2 | 7.0 | ||
Cost of sales | 0.0 | 0.0 | ||
Total depreciation and amortization | 7.2 | 7.0 | ||
Property, Plant and Equipment | ||||
Depreciation | ||||
Depreciation and amortization expense | 1.3 | 1.0 | ||
Cost of sales | 0.2 | 0.3 | ||
Total depreciation and amortization | 1.5 | 1.3 | ||
Residual Commission Buyouts | ||||
Amortization | ||||
Depreciation and amortization expense | 21.6 | 1.9 | ||
Cost of sales | 0.0 | 0.0 | ||
Total depreciation and amortization | 21.6 | 1.9 | ||
Other Intangible Assets | ||||
Amortization | ||||
Depreciation and amortization expense | 5.2 | 7.4 | ||
Cost of sales | 8.3 | 5.4 | ||
Total depreciation and amortization | 13.5 | 12.8 | ||
Capitalized Acquisition Costs | ||||
Amortization | ||||
Depreciation and amortization expense | 0.0 | 0.0 | ||
Cost of sales | 3.8 | 6.1 | ||
Total depreciation and amortization | 3.8 | 6.1 | ||
Acquired Intangible Assets | ||||
Amortization | ||||
Total depreciation and amortization | 30.0 | 12.5 | ||
Non-Acquired Intangible Assets | ||||
Amortization | ||||
Total depreciation and amortization | $ 8.9 | $ 8.3 | ||
|
Depreciation and Amortization - Schedule of Estimated Amortization Expense (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Total Amortization | ||
2023 (remaining nine months) | $ 121.5 | |
2024 | 157.3 | |
2025 | 143.0 | |
2026 | 82.5 | |
2027 | 24.4 | |
Thereafter | 99.9 | |
Net Carrying Value | 628.6 | |
Residual Commission Buyouts | ||
Total Amortization | ||
2023 (remaining nine months) | 63.0 | |
2024 | 83.8 | |
2025 | 81.9 | |
2026 | 48.3 | |
2027 | 1.6 | |
Thereafter | 4.4 | |
Net Carrying Value | 283.0 | $ 303.9 |
Other Intangible Assets | ||
Total Amortization | ||
2023 (remaining nine months) | 47.0 | |
2024 | 59.5 | |
2025 | 51.1 | |
2026 | 30.3 | |
2027 | 22.6 | |
Thereafter | 95.5 | |
Net Carrying Value | 306.0 | 306.8 |
Capitalized Acquisition Costs | ||
Total Amortization | ||
2023 (remaining nine months) | 11.5 | |
2024 | 14.0 | |
2025 | 10.0 | |
2026 | 3.9 | |
2027 | 0.2 | |
Thereafter | 0.0 | |
Net Carrying Value | $ 39.6 | $ 36.1 |
Residual Commission Buyouts - Schedule of Residual Commission Buyouts (Details) - USD ($) $ in Millions |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Residual Commission Buyouts [Line Items] | ||
Net Carrying Value | $ 628.6 | |
Residual commission buyouts from asset acquisitions | ||
Residual Commission Buyouts [Line Items] | ||
Weighted Average Amortization Period | 4 years | 4 years |
Carrying Value | $ 334.6 | $ 334.5 |
Accumulated Amortization | (63.3) | (42.6) |
Net Carrying Value | $ 271.3 | $ 291.9 |
Residual commission buyouts from business combinations | ||
Residual Commission Buyouts [Line Items] | ||
Weighted Average Amortization Period | 8 years | 8 years |
Carrying Value | $ 12.7 | $ 12.6 |
Accumulated Amortization | (1.0) | (0.6) |
Net Carrying Value | 11.7 | 12.0 |
Residual commission buyouts | ||
Residual Commission Buyouts [Line Items] | ||
Carrying Value | 347.3 | 347.1 |
Accumulated Amortization | (64.3) | (43.2) |
Net Carrying Value | $ 283.0 | $ 303.9 |
Residual Commission Buyouts - Narrative (Details) - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2022 |
Mar. 31, 2023 |
|
Residual Commission Buyouts [Line Items] | ||
Residual commission buyouts, contingent consideration, asset | $ 14.2 | $ 14.2 |
Mass Strategic Buyout | ||
Residual Commission Buyouts [Line Items] | ||
Residual commission buyouts, consideration transferred | 305.4 | |
Residual commission buyouts, contingent consideration, asset | 8.3 | 8.3 |
Residual commission buyouts, contingent consideration, asset, maximum | $ 23.0 | $ 23.0 |
Other Intangible Assets, Net (Details) - USD ($) $ in Millions |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Finite Lived Intangible Assets [Line Items] | ||
Net Carrying Value | $ 628.6 | |
Merchant relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period | 12 years | 12 years |
Carrying Value | $ 198.4 | $ 196.3 |
Accumulated Amortization | (41.0) | (36.4) |
Net Carrying Value | $ 157.4 | $ 159.9 |
Acquired technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period | 9 years | 10 years |
Carrying Value | $ 123.3 | $ 123.1 |
Accumulated Amortization | (67.4) | (64.1) |
Net Carrying Value | $ 55.9 | $ 59.0 |
Trademarks and trade names | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period | 13 years | 13 years |
Carrying Value | $ 27.2 | $ 27.2 |
Accumulated Amortization | (4.4) | (3.8) |
Net Carrying Value | $ 22.8 | $ 23.4 |
Capitalized software development costs | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period | 3 years | 3 years |
Carrying Value | $ 90.4 | $ 80.3 |
Accumulated Amortization | (20.5) | (15.8) |
Net Carrying Value | 69.9 | 64.5 |
Other intangible assets | ||
Finite Lived Intangible Assets [Line Items] | ||
Carrying Value | 439.3 | 426.9 |
Accumulated Amortization | (133.3) | (120.1) |
Net Carrying Value | $ 306.0 | $ 306.8 |
Capitalized Customer Acquisition Costs, Net (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Capitalized Customer Acquisition Costs, Net [Abstract] | ||
Capitalized acquisition cost, net | $ 39.6 | $ 36.1 |
Capitalized acquisition cost, gross carrying value | 78.6 | 72.3 |
Capitalized acquisition cost, accumulated amortization | $ 39.0 | $ 36.2 |
Capitalized acquisition costs, weighted average amortization period | 4 years | 4 years |
Equipment for Lease, Net (Details) - USD ($) $ in Millions |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Operating Leased Assets [Line Items] | ||
Carrying Value | $ 136.7 | $ 121.0 |
Accumulated Depreciation | (47.1) | (40.3) |
Net Carrying Value | $ 89.6 | $ 80.7 |
Equipment under lease | ||
Operating Leased Assets [Line Items] | ||
Weighted Average Depreciation Period | 4 years | 4 years |
Carrying Value | $ 124.0 | $ 107.7 |
Accumulated Depreciation | (47.1) | (40.3) |
Net Carrying Value | 76.9 | 67.4 |
Equipment held for lease | ||
Operating Leased Assets [Line Items] | ||
Carrying Value | 12.7 | 13.3 |
Accumulated Depreciation | 0.0 | 0.0 |
Net Carrying Value | $ 12.7 | $ 13.3 |
Property, Plant and Equipment, Net (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 35.7 | $ 33.0 |
Less: Accumulated depreciation | (12.0) | (10.7) |
Total property, plant and equipment, net | 23.7 | 22.3 |
Equipment | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 17.5 | 17.0 |
Capitalized software | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 3.8 | 3.8 |
Leasehold improvements | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 12.8 | 10.4 |
Furniture and fixtures | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 1.1 | 1.3 |
Vehicles | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 0.5 | $ 0.5 |
Debt - Summary of Outstanding Debt (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Debt Instrument [Line Items] | ||
Total borrowings | $ 1,772.5 | $ 1,772.5 |
Less: Unamortized capitalized financing fees | (28.5) | (30.6) |
Total long-term debt | $ 1,744.0 | 1,741.9 |
Convertible Notes Due 2025 | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 0.49% | |
Total borrowings | $ 690.0 | 690.0 |
2027 Convertible Notes | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 0.90% | |
Total borrowings | $ 632.5 | 632.5 |
2026 Senior Notes | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 5.13% | |
Total borrowings | $ 450.0 | $ 450.0 |
Debt - Narrative (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Debt Instrument [Line Items] | ||
Amortization of capitalized financing fees | $ 2,100,000 | $ 1,900,000 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | |
4.625% Senior Notes Due 2026 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate, stated percentage | 4.625% | |
2027 Convertible Notes | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate, stated percentage | 0.50% |
Debt - Schedule of Maturities of Long-term Debt (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Long-term Debt, Fiscal Year Maturity [Abstract] | ||
2025 | $ 690.0 | |
2026 | 450.0 | |
2027 | 632.5 | |
Total borrowings | $ 1,772.5 | $ 1,772.5 |
Debt - Schedule of Long-Term Debt Instruments (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Debt Instrument [Line Items] | ||
Principal outstanding | $ 1,772.5 | $ 1,772.5 |
Unamortized debt issuance costs | (28.5) | (30.6) |
Convertible Notes Due 2025 | ||
Debt Instrument [Line Items] | ||
Principal outstanding | 690.0 | 690.0 |
Convertible Notes Due 2025 | Convertible Debt | ||
Debt Instrument [Line Items] | ||
Principal outstanding | 690.0 | 690.0 |
Unamortized debt issuance costs | (8.9) | (9.7) |
Total | 681.1 | 680.3 |
2026 Senior Notes | ||
Debt Instrument [Line Items] | ||
Principal outstanding | 450.0 | 450.0 |
2026 Senior Notes | Senior Notes | ||
Debt Instrument [Line Items] | ||
Principal outstanding | 450.0 | 450.0 |
Unamortized debt issuance costs | (8.0) | (8.6) |
Total | 442.0 | 441.4 |
Convertible Notes Due 2027 | ||
Debt Instrument [Line Items] | ||
Principal outstanding | 632.5 | 632.5 |
Convertible Notes Due 2027 | Convertible Debt | ||
Debt Instrument [Line Items] | ||
Principal outstanding | 632.5 | 632.5 |
Unamortized debt issuance costs | (10.9) | (11.5) |
Total | $ 621.6 | $ 621.0 |
Other Consolidated Balance Sheet Components - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) |
Mar. 31, 2023 |
Dec. 31, 2022 |
Feb. 28, 2022 |
---|---|---|---|
Other Consolidated Balance Sheet Components [Abstract] | |||
Prepaid insurance | $ 2,400,000 | $ 3,200,000 | |
Taxes receivable | 1,400,000 | 1,800,000 | |
Crypto settlement assets | 3,200,000 | 1,800,000 | $ 4,800,000 |
Other prepaid expenses | 8,700,000 | 7,300,000 | |
Other current assets | 1,800,000 | 1,300,000 | |
Total prepaid expenses and other current assets | 17,500,000 | 15,400,000 | |
Contract assets | 100,000 | 100,000 | |
Allowance for contract assets | $ 0 | $ 0 |
Other Consolidated Balance Sheet Components - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
Feb. 28, 2022 |
---|---|---|---|
Other Consolidated Balance Sheet Components [Abstract] | |||
Contingent liability earnouts for acquisitions | $ 28.5 | $ 34.9 | |
Contingent liability earnouts for residual commission buyouts | 9.8 | 10.0 | |
Residuals payable | 9.4 | 8.9 | |
Accrued interest | 9.3 | 4.9 | |
Accrued payroll | 13.0 | 10.0 | |
Taxes payable | 5.3 | 4.4 | |
Crypto settlement liabilities | 3.2 | 1.8 | $ 4.8 |
Other current liabilities | 4.0 | 5.1 | |
Total accrued expenses and other current liabilities | $ 82.5 | $ 80.0 |
Other Consolidated Balance Sheet Components - Other Noncurrent Assets (Details) - USD ($) |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Offsetting [Abstract] | ||
Indemnification asset | $ 7,500,000 | $ 7,500,000 |
Prepaid expenses and other noncurrent assets | 2,500,000 | 3,000,000.0 |
Contract assets | 400,000 | 400,000 |
Total other noncurrent assets | 10,400,000 | 10,900,000 |
Contract assets, allowance for credit loss | $ 0 | $ 0 |
Other Consolidated Balance Sheet Components - Schedule of Other Noncurrent Liabilities (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Contingent liability earnouts for acquisitions | $ 13.8 | $ 10.3 |
Taxes payable | 10.0 | 9.9 |
Deferred revenue | 2.3 | 2.8 |
TRA liability | 2.2 | 1.7 |
Other noncurrent liabilities | 1.2 | 1.8 |
Total other noncurrent liabilities | 29.5 | 26.5 |
Unrecognized Tax Benefits | $ 8.1 | $ 8.0 |
Fair Value Measurement - Narrative (Details) $ in Millions |
3 Months Ended | |||||
---|---|---|---|---|---|---|
Mar. 31, 2023
USD ($)
|
Mar. 31, 2022
USD ($)
|
Jan. 20, 2023
USD ($)
|
Dec. 31, 2022
USD ($)
|
Sep. 29, 2022
USD ($)
|
Feb. 28, 2022
USD ($)
|
|
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Revaluation of contingent liabilities | $ 7.0 | $ 0.0 | ||||
Contingent consideration | 0.3 | 57.8 | ||||
Contingent liability earnouts for acquisitions | 13.8 | $ 10.3 | ||||
Equity securities without readily determinable fair value, amount | 56.0 | 47.1 | ||||
Unrealized gain on investments in securities (Note 13) | 8.9 | $ 0.0 | ||||
Cumulative unrealized gain (loss) on investments in securities | 24.0 | |||||
Crypto settlement assets | 3.2 | $ 1.8 | $ 4.8 | |||
Online Payments Group | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Contingent consideration arrangements, maximum | $ 60.0 | |||||
Revaluation of contingent liabilities | 7.0 | |||||
Contingent consideration | 40.2 | $ 22.0 | ||||
Online Payments Group | Accrued Expenses and Other Current Liabilities | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Contingent consideration | 28.0 | |||||
Online Payments Group | Other Noncurrent Liabilities | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Contingent consideration | $ 12.2 | |||||
Online Payments Group | Price Volatility | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Measurement input | 0.536 | 0.544 | ||||
Online Payments Group | Discount Rate | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Measurement input | 0.076 | 0.072 | ||||
The Giving Block | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Contingent consideration arrangements, maximum | 246.0 | |||||
Revaluation of contingent liabilities | $ (0.5) | |||||
Contingent consideration | $ 57.8 | |||||
Acquisition cost expensed | 10.2 | |||||
Contingent liability earnouts | 2.9 | $ 10.9 | ||||
Contingent liability earnouts for acquisitions | 7.3 | |||||
Certain Restaurant Technology Partners | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Revaluation of contingent liabilities | 0.5 | |||||
Contingent consideration | 6.5 | |||||
Contingent liability earnouts for acquisitions | 1.6 | |||||
Certain Restaurant Technology Partners | Accrued Expenses and Other Current Liabilities | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Contingent consideration | $ 2.1 | |||||
Certain Restaurant Technology Partners | Discount Rate | Minimum | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Measurement input | 0.065 | 0.051 | ||||
Certain Restaurant Technology Partners | Discount Rate | Maximum | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Measurement input | 0.073 | 0.067 | ||||
ISS | ||||||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||||
Contingent consideration arrangements, maximum | $ 24.5 | |||||
Contingent consideration for residual commission buyouts | $ 9.8 |
Fair Value Measurement - Reconciliation of Beginning and Ending Balances for Level 3 Contingent Liabilities (Details) - Significant Observable Inputs (Level 3) $ in Millions |
3 Months Ended |
---|---|
Mar. 31, 2023
USD ($)
| |
Contingent Liabilities for Acquisitions | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | $ 45.2 |
Contingent consideration for acquisitions | 0.3 |
Contingent liabilities that achieved earnout | (10.2) |
Fair value adjustments | 7.0 |
Balance at end of period | 42.3 |
Contingent Liabilities for Residual Commission Buyouts | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | 10.0 |
Contingent consideration for acquisitions | 0.0 |
Contingent liabilities that achieved earnout | (0.2) |
Fair value adjustments | 0.0 |
Balance at end of period | 9.8 |
Total Contingent Liabilities | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | 55.2 |
Contingent consideration for acquisitions | 0.3 |
Contingent liabilities that achieved earnout | (10.4) |
Fair value adjustments | 7.0 |
Balance at end of period | $ 52.1 |
Fair Value Measurement - Summary of Estimated Fair Value (Details) - USD ($) $ in Millions |
Mar. 31, 2023 |
Dec. 31, 2022 |
---|---|---|
Carrying Value | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | $ 1,744.7 | $ 1,742.7 |
Fair Value | Level 2 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | 1,819.0 | 1,643.6 |
2025 Convertible Notes | Carrying Value | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | 681.1 | 680.3 |
2025 Convertible Notes | Fair Value | Level 2 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | 790.7 | 686.9 |
2027 Convertible Notes | Carrying Value | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | 621.6 | 621.0 |
2027 Convertible Notes | Fair Value | Level 2 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | 601.1 | 533.7 |
2026 Senior Notes | Carrying Value | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | 442.0 | 441.4 |
2026 Senior Notes | Fair Value | Level 2 | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Long-term debt | 427.2 | 423.0 |
Line of Credit | Revolving Credit Facility | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Unamortized debt issuance costs | $ 0.7 | $ 0.8 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
Dec. 31, 2022 |
|
Valuation Allowance [Line Items] | |||
Effective tax rate | (21.40%) | (32.00%) | |
Tax benefit, valuation allowance | $ 4.8 | ||
Tax benefit of net operating loss carryback allowed due to CARES Act | 6.4 | ||
Uncertain tax positions | $ 8.1 | $ 8.0 | |
Tax receivable agreement realized tax benefit percentage | 85.00% | ||
Tax receivable agreement expected remaining tax benefit percentage | 15.00% | ||
Tax receivable agreement recognized liability | $ 2.2 | 1.7 | |
Tax receivable agreement unrecognized liability | 291.6 | ||
TRA liability | $ 2.2 | 1.7 | |
Rook | |||
Valuation Allowance [Line Items] | |||
Deferred tax asset exchange of interests | 457.3 | ||
TRA liability | $ 388.7 |
Lease Agreements (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Disaggregation of Revenue [Line Items] | ||
Operating lease, lease income | $ 5.3 | $ 4.3 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2023-04-01 | ||
Disaggregation of Revenue [Line Items] | ||
Total remaining performance obligations amount | $ 11.8 | |
Total remaining performance obligations period | 1 year |
Related Party Transactions (Details) |
1 Months Ended | 3 Months Ended | |||||
---|---|---|---|---|---|---|---|
Sep. 30, 2021
contract
$ / Unit
shares
|
Mar. 31, 2021
shares
|
Mar. 31, 2023
USD ($)
shares
|
Mar. 31, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
Dec. 31, 2021
$ / Unit
shares
|
Nov. 30, 2021 |
|
Related Party Transaction [Line Items] | |||||||
Distributions to noncontrolling interests | $ | $ 1,400,000 | $ 0 | |||||
Rook | |||||||
Related Party Transaction [Line Items] | |||||||
Right to exchange and sell limited liability company shares by lender upon default (in shares) | 15,000,000 | ||||||
Class B Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Exchange of shares held (in shares) | 1,666,665 | ||||||
Aircraft Service | Founder | |||||||
Related Party Transaction [Line Items] | |||||||
Outstanding to related parties | $ | $ 0 | $ 0 | |||||
One-Time Discretionary Equity Award Program | Affiliated Entity | Non Management Employees | Class C Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Equity funded portion, percentage | 50.00% | ||||||
Equity funded portion (in shares) | 767,748 | ||||||
VPF Contract | Affiliated Entity | |||||||
Related Party Transaction [Line Items] | |||||||
Forward floor price (in dollars per share) | $ / Unit | 73.19 | ||||||
Forward cap price (in dollars per share) | $ / Unit | 137.24 | ||||||
VPF Contract | Affiliated Entity | Class A Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares covering under contract (in shares) | 2,000,000 | ||||||
VPF Contract | Affiliated Entity | Class B Common Stock | Maximum | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares pledged under contract (in shares) | 4,440,000 | 2,000,000 | |||||
VPF Contracts With Dealer | Affiliated Entity | |||||||
Related Party Transaction [Line Items] | |||||||
Number of VPF contracts | contract | 2 | ||||||
VPF Contract Dealer One | Affiliated Entity | |||||||
Related Party Transaction [Line Items] | |||||||
Forward cap price (in dollars per share) | $ / Unit | 112.09 | ||||||
VPF Contract Dealer One | Affiliated Entity | Class A Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares covering under contract (in shares) | 2,180,000 | ||||||
VPF Contract Dealer Two | Affiliated Entity | |||||||
Related Party Transaction [Line Items] | |||||||
Forward floor price (in dollars per share) | $ / Unit | 66.424 | ||||||
Forward cap price (in dollars per share) | $ / Unit | 120.39 | ||||||
VPF Contract Dealer Two | Affiliated Entity | Class A Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Number of shares covering under contract (in shares) | 2,260,000 | ||||||
General and Administrative Expenses | Aircraft Service | Shareholder | |||||||
Related Party Transaction [Line Items] | |||||||
Total expense transaction with related party | $ | $ 200,000 | $ 200,000 |
Stockholders’ Equity (Details) |
3 Months Ended | ||||
---|---|---|---|---|---|
Mar. 31, 2022
USD ($)
$ / shares
shares
|
Mar. 31, 2023
shares
|
Dec. 31, 2022
program
|
Jun. 15, 2022
USD ($)
|
Dec. 31, 2021
program
|
|
Class of Stock [Line Items] | |||||
Number of stock repurchase programs | program | 3 | 3 | |||
Treasury stock, repurchased (in shares) | shares | 0 | ||||
Class A Common Stock | |||||
Class of Stock [Line Items] | |||||
Stock repurchase program, authorized amount | $ | $ 250,000,000 | ||||
Treasury stock, common stock (in shares) | shares | 301,510 | ||||
Treasury stock, common stock | $ | $ 17,200,000 | ||||
Treasury stock acquired (in dollars per share) | $ / shares | $ 56.78 |
Noncontrolling Interests (Details) - Shift4 Payments, LLC. - shares |
3 Months Ended | 12 Months Ended |
---|---|---|
Mar. 31, 2023 |
Dec. 31, 2022 |
|
Noncontrolling Interest [Line Items] | ||
LLC Interests (in shares) | 83,186,588 | 82,950,330 |
Shift4 Payments, Inc. | ||
Noncontrolling Interest [Line Items] | ||
LLC Interests (in shares) | 59,024,237 | 57,121,314 |
Ownership % | 71.00% | 68.90% |
Rook | ||
Noncontrolling Interest [Line Items] | ||
LLC Interests (in shares) | 24,162,351 | 25,829,016 |
Ownership % | 29.00% | 31.10% |
Equity-based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | ||
---|---|---|---|
Jun. 10, 2022 |
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Equity-based compensation expense | $ 20.9 | $ 16.9 | |
Initial Public Offering | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Share price (in dollars per share) | $ 23.00 | ||
RSUs and PRSUs | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized equity-based compensation expense | $ 139.7 | ||
Unrecognized equity-based compensation expense expected to be recognized over weighted-average period | 3 years 3 months 7 days | ||
2020 Incentive Award Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Maximum common stock available for issuance (in shares) | 721,911 | ||
Restated Equity Plan | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Percentage of outstanding shares of all classes of common stock | 2.00% |
Equity-based Compensation - Schedule of RSU Activity (Details) - RSUs |
3 Months Ended |
---|---|
Mar. 31, 2023
$ / shares
shares
| |
Number of RSUs | |
Unvested balance at beginning of period (in shares) | shares | 2,465,355 |
Granted (in shares) | shares | 1,245,155 |
Vested (in shares) | shares | (194,613) |
Forfeited or cancelled (in shares) | shares | (129,176) |
Unvested balance at end of period (in shares) | shares | 3,386,721 |
Weighted Average Grant Date Fair Value | |
Unvested balance at beginning of period (in dollars per share) | $ / shares | $ 47.57 |
Granted (in dollars per share) | $ / shares | 64.30 |
Vested (in dollars per share) | $ / shares | 60.59 |
Forfeited or cancelled (in dollars per share) | $ / shares | 53.40 |
Unvested balance at end of period (in dollars per share) | $ / shares | $ 52.75 |
Basic and Diluted Net Income (Loss) per Share - Schedule of Calculation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Earnings Per Share Basic and Diluted [Line Items] | ||
Net income (loss) | $ 20.4 | $ (13.2) |
Less: Net income (loss) attributable to noncontrolling interests | 5.6 | (5.7) |
Net income (loss) attributable to Shift4 Payments, Inc. | 14.8 | (7.5) |
Adjustment to net income (loss) attributable to common stockholders | 0.0 | 0.0 |
Net income (loss) attributable to common stockholders | 14.8 | (7.5) |
Numerator - allocation of net income (loss) attributable to common stockholders: | ||
Net income (loss) allocated to common stock - basic | 14.8 | (7.5) |
Class A Common Stock | ||
Earnings Per Share Basic and Diluted [Line Items] | ||
Net income (loss) attributable to common stockholders | 14.2 | (6.9) |
Numerator - allocation of net income (loss) attributable to common stockholders: | ||
Net income (loss) allocated to common stock - basic | 14.2 | (6.9) |
Reallocation of net income attributable to common stockholders from assumed conversion of LLC interests and assumed vesting of RSUs | 5.7 | 0.0 |
Net income (loss) allocated to common stock - diluted | $ 19.9 | $ (6.9) |
Denominator: | ||
Weighted average shares of common stock outstanding, basic (in shares) | 55,236,204 | 52,119,378 |
Weighted average shares of common stock outstanding, diluted (in shares) | 82,238,704 | 52,119,378 |
Net income (loss) per share - Basic: | ||
Net income (loss) per share - basic (in dollars per share) | $ 0.26 | $ (0.13) |
Net income (loss) per share - Diluted: | ||
Net income (loss) per share - diluted (in dollars per share) | $ 0.24 | $ (0.13) |
Class A Common Stock | LLC Interests | ||
Denominator: | ||
Effect of dilutive securities (in shares) | 25,533,462 | 0 |
Class A Common Stock | RSUs | ||
Denominator: | ||
Effect of dilutive securities (in shares) | 1,469,038 | 0 |
Class C Common Stock | ||
Earnings Per Share Basic and Diluted [Line Items] | ||
Net income (loss) attributable to common stockholders | $ 0.6 | $ (0.6) |
Numerator - allocation of net income (loss) attributable to common stockholders: | ||
Net income (loss) allocated to common stock - basic | 0.6 | (0.6) |
Reallocation of net income attributable to common stockholders from assumed conversion of LLC interests and assumed vesting of RSUs | (0.1) | 0.0 |
Net income (loss) allocated to common stock - diluted | $ 0.5 | $ (0.6) |
Denominator: | ||
Weighted average shares of common stock outstanding, basic (in shares) | 2,241,648 | 4,573,372 |
Weighted average shares of common stock outstanding, diluted (in shares) | 2,241,648 | 4,573,372 |
Net income (loss) per share - Basic: | ||
Net income (loss) per share - basic (in dollars per share) | $ 0.26 | $ (0.13) |
Net income (loss) per share - Diluted: | ||
Net income (loss) per share - diluted (in dollars per share) | $ 0.24 | $ (0.13) |
Basic and Diluted Net Income (Loss) per Share - Schedule of Calculation of Diluted Net Loss Per Share as the Effect Would be Anti-dilutive (Details) - shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Earnings Per Share Basic and Diluted [Line Items] | ||
Antidilutive securities excluded from computation of net loss per share (in shares) | 6,908 | 28,929,329 |
LLC Interests that convert into potential Class A common shares | ||
Earnings Per Share Basic and Diluted [Line Items] | ||
Antidilutive securities excluded from computation of net loss per share (in shares) | 0 | 26,272,654 |
RSUs and performance RSUs | ||
Earnings Per Share Basic and Diluted [Line Items] | ||
Antidilutive securities excluded from computation of net loss per share (in shares) | 6,908 | 2,656,675 |
Basic and Diluted Net Income (Loss) per Share - Narrative (Details) |
1 Months Ended | |
---|---|---|
Jul. 31, 2021
day
|
Mar. 31, 2023
USD ($)
|
|
Convertible Notes Due 2025 | ||
Schedule Of Earnings Per Share Basic And Diluted By Common Class [Line Items] | ||
Debt instrument, face amount | $ | $ 690,000,000 | |
Convertible Notes Due 2025 | Quarter Commencing After March 31, 2022 | Convertible Debt | ||
Schedule Of Earnings Per Share Basic And Diluted By Common Class [Line Items] | ||
Debt Instrument, convertible price percentage | 130.00% | |
Debt Instrument, number of trading days | day | 20 | |
Debt Instrument, number of consecutive trading days | day | 30 | |
Senior Notes Due 2027 | ||
Schedule Of Earnings Per Share Basic And Diluted By Common Class [Line Items] | ||
Debt instrument, face amount | $ | $ 632,500,000 |
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Supplemental Cash Flow Information [Abstract] | ||
Cash paid for interest | $ 1.6 | $ 1.6 |
Cash paid for income taxes, net of refunds | 1.3 | 0.0 |
Noncash investing activities | ||
Shares and equity-based compensation awards issued in connection with acquisitions | 0.0 | 36.5 |
Contingent consideration for acquisitions | 0.3 | 57.8 |
Equipment for lease | 6.0 | 3.9 |
Capitalized software development costs | 2.1 | 2.2 |
Acquisition of property, plant and equipment | 1.9 | 0.0 |
Noncash financing activities | ||
Shares and equity-based compensation awards measured but not yet issued in connection with settlement of contingent consideration for acquisitions | 7.6 | 0.0 |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 2.4 | $ 0.0 |
Segments - Narrative (Details) |
3 Months Ended |
---|---|
Mar. 31, 2023
segment
| |
Segment Reporting [Abstract] | |
Number of operating segment | 1 |
Number of reportable segment | 1 |
Segments - Summary of Gross Revenue by Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2023 |
Mar. 31, 2022 |
|
Segment Reporting Information [Line Items] | ||
Gross revenue | $ 547.0 | $ 401.9 |
Payments-based revenue | ||
Segment Reporting Information [Line Items] | ||
Gross revenue | 511.0 | 371.5 |
Subscription and other revenues | ||
Segment Reporting Information [Line Items] | ||
Gross revenue | $ 36.0 | $ 30.4 |
Subsequent Events (Details) - Subsequent Events - USD ($) |
1 Months Ended | ||
---|---|---|---|
May 05, 2023 |
Apr. 30, 2023 |
May 03, 2023 |
|
Subsequent Event [Line Items] | |||
Restricted cash, funds held at bank, minimum balance | $ 25,000,000 | ||
Restricted cash, funds held at bank, minimum balance, percentage of highest overdraft balance | 110.00% | ||
Restricted cash, funds held at bank, minimum balance, percentage of highest overdraft balance, period | 90 days | ||
Stock repurchase program, authorized amount | $ 250,000,000 | ||
Secret POS Systems | |||
Subsequent Event [Line Items] | |||
Business combination, consideration transferred | $ 45,000,000 | ||
Cash | 35,000,000 | ||
Equity interest issued or issuable, value assigned | $ 10,000,000 |
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