PROPERTY AND EQUIPMENT

9 Months Ended

Sep. 30, 2022

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

6.      PROPERTY AND EQUIPMENT

The major components of property and equipment are as follows:

	As of September 30,		As of December 31,
	2022		2021
	(unaudited)
Leasehold improvements	$	20,904	$	20,956
Equipment		38,974		41,937
Computer software purchased		12,005		11,792
Internal-use software developed:
Cloud-based customer solutions		132,062		114,872
Internal systems and tools		40,368		32,408
Furniture and fixtures		7,661		7,675
In-process internal-use software		27,773		16,965
Property and equipment		279,747		246,605
Less accumulated depreciation and amortization		(170,624)		(148,215)
Property and equipment, net	$	109,123	$	98,390

Depreciation expense for property and equipment, excluding all internal-use software developed and finance leases, was $1,535 and $1,849 for the three months ended September 30, 2022 and 2021, respectively, $4,923 and $5,658 for the nine months ended September 30, 2022 and 2021 and is reflected in depreciation and amortization in the condensed consolidated statements of comprehensive loss.

Finance lease amortization was $174 and $944 for the three and nine months ended September 30, 2022, respectively, and depreciation expense for assets held under capital leases was $363 and $826 for the three and nine months ended September 30, 2021, respectively. Finance lease amortization and depreciation expense for assets held under capital leases are included in depreciation and amortization expense in the condensed consolidated statements of comprehensive loss.

Assets under finance leases of $2,225 and $1,533, net of accumulated amortization of $1,875 and $931, respectively, at September 30, 2022 and December 31, 2021, respectively, are included in property and equipment in the condensed consolidated balance sheets.

The major components of internal-use software are as follows:

	As of September 30,		As of December 31,
	2022		2021
	(unaudited)
Internal-use software developed	$	172,430	$	147,280
Less accumulated depreciation		(108,881)		(87,281)
Internal-use software developed, net of accumulated depreciation		63,549		59,999
In-process internal-use software		27,773		16,965
Internal-use software developed, net	$	91,322	$	76,964

Amounts included in property and equipment additions related to capitalized internal-use software on the condensed consolidated statements of cash flows are as follows:

	For the nine months ended September 30,
	2022		2021
	(unaudited)
Cloud-based customer solutions	$	22,014	$	13,881
Internal systems and tools		18,924		7,762
Total	$	40,938	$	21,643

In-process internal-use software developed is not depreciated until it is available for its intended use. Depreciation expense for internal-use software developed for cloud-based customer solutions for the three months ended September 30, 2022 and 2021 was $6,881 and $7,561, respectively, $20,139 and $12,906, for the nine months ended September 30, 2022 and 2021, respectively, and is included in cost of revenues, software subscriptions in the condensed consolidated statements of comprehensive loss.

Depreciation expense for internal-use software developed for internal systems and tools for the three months ended September 30, 2022 and 2021 was $1,228 and $870, respectively, and $3,253 and $2,303 for the nine months ended September 30, 2022 and 2021, and is included in depreciation and amortization in the condensed consolidated statements of comprehensive loss.