Change in Accounting Principle

9 Months Ended

Sep. 30, 2021

Accounting Changes and Error Corrections [Abstract]

Change in Accounting Principle

Change in Accounting Principle

In the first quarter of 2021, the Company changed its policy for recognizing equity-based compensation expense from the graded vesting attribution method of accounting to the straight-line attribution method of accounting for its equity-based compensation arrangements with service only vesting conditions.

The Company believes the straight-line attribution method of accounting for equity-based compensation expense for awards with service only vesting conditions is preferable because it more appropriately reflects how awards are earned over an employee’s service period and is the predominant method used in its industry.

Comparative financial statements for prior periods have been adjusted to apply the straight-line attribution method retrospectively. The following table presents the comparative effect of the change in accounting method and its impact on the Company’s condensed consolidated statements of operations and comprehensive loss:

	Three Months Ended September 30, 2020				Nine Months Ended September 30, 2020
(in thousands, except for per share amounts)	As Reported		As Adjusted		As Reported		As Adjusted
Total net revenues	$	3,136,507	$	3,136,507	$	8,163,846	$	8,163,846
Cost of sales	2,669,479		2,669,552		6,826,847		6,826,861
Operating, general and administrative	684,893		683,192		1,728,585		1,722,077
Total operating cost and expenses	3,354,372		3,352,744		8,555,432		8,548,938
Operating loss	(217,865)		(216,237)		(391,586)		(385,092)
Loss before income taxes	(174,606)		(172,978)		(386,668)		(380,174)
Income tax expense	21		21		228		228
Net loss	(174,627)		(172,999)		(386,896)		(380,402)
Net loss attributable to Class A and Class B common stockholders	$	(174,627)	$	(172,999)	$	(479,630)	$	(473,136)
Net loss attributable to Class A and Class B common stockholders per share, basic and diluted(1)	$	(5.96)	$	(5.91)	$	(17.71)	$	(17.47)
Weighted-average number of Class A and Class B common shares outstanding used in computing per share amounts, basic and diluted(1)	29,284		29,284		27,085		27,085
Comprehensive loss	$	(177,547)	$	(175,919)	$	(391,428)	$	(384,934)

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(1)As reported net loss per share reflects the retrospective adjustments from the Corporate Conversion described in Note 14 — "Net Loss per Share."

The following table presents the comparative effect of the change in accounting method and its impact on the Company’s condensed consolidated balance sheets:

	As of December 31, 2020
(in thousands)	As Reported		As Adjusted
Stockholders'/members’ equity (deficit)
Common units	$	54,950	$	45,122
Additional paid-in capital	25,036		25,036
Accumulated other comprehensive income (loss)	(31,093)		(31,093)
Accumulated deficit	(4,117,755)		(4,107,927)
Total stockholders'/members’ equity (deficit)	$	(4,068,862)	$	(4,068,862)

There was no net impact to the amounts reported for net cash used in/provided by operating, investing or financing activities in the condensed consolidated statements of cash flows for prior periods as a result of the change in accounting method. However, for the nine months ended September 30, 2020, net loss and equity-based compensation expense in cash flows from operating activities each decreased $6 million to reflect the change in accounting method. The cumulative effect of the change in accounting method had no net impact on stockholders’/members’ equity (deficit) as of January 1, 2020, the beginning of the earliest year presented in the condensed consolidated financial statements.