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September 30, 2017 | December 31, 2016 | ||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
Cash and Cash Equivalents: | |||||||||||||||||||||||
Money market funds | $ | 384,546 | $ | — | $ | — | $ | 207,168 | $ | — | $ | — | |||||||||||
U.S. agency securities | — | — | — | — | — | — | |||||||||||||||||
Commercial paper | — | — | — | — | 7,496 | — | |||||||||||||||||
U.S. government securities | — | — | — | — | — | — | |||||||||||||||||
Corporate bonds | — | — | — | — | — | — | |||||||||||||||||
Municipal securities | — | — | — | — | 1,000 | — | |||||||||||||||||
Short-term securities: | |||||||||||||||||||||||
U.S. agency securities | — | 13,091 | — | — | 9,055 | — | |||||||||||||||||
Corporate bonds | — | 52,420 | — | — | 6,980 | — | |||||||||||||||||
Commercial paper | — | 58,298 | — | — | 17,298 | — | |||||||||||||||||
Municipal securities | — | 22,493 | — | — | 8,028 | — | |||||||||||||||||
U.S. government securities | 63,657 | — | 18,540 | — | — | ||||||||||||||||||
Long-term securities: | |||||||||||||||||||||||
U.S. agency securities | — | 25,269 | — | — | 3,502 | — | |||||||||||||||||
Corporate bonds | — | 88,673 | — | — | 12,914 | — | |||||||||||||||||
Municipal securities | — | 20,080 | — | — | 2,492 | — | |||||||||||||||||
U.S. government securities | 57,313 | — | — | 8,458 | — | — | |||||||||||||||||
Total | $ | 505,516 | $ | 280,324 | $ | — | $ | 234,166 | $ | 68,765 | $ | — |
September 30, 2017 | |||||||
Carrying Value | Fair Value (Level 2) | ||||||
Convertible senior notes | $ | 354,237 | $ | 616,000 | |||
Total | $ | 354,237 | $ | 616,000 |
September 30, 2017 | December 31, 2016 | ||||||||||||||
Carrying Value | Fair Value (Level 3) | Carrying Value | Fair Value (Level 3) | ||||||||||||
Loans held for sale | $ | 58,331 | $ | 60,375 | $ | 42,144 | $ | 42,633 | |||||||
Total | $ | 58,331 | $ | 60,375 | $ | 42,144 | $ | 42,633 |
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Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Short-term securities: | |||||||||||||||
U.S. agency securities | $ | 13,084 | $ | 7 | $ | — | $ | 13,091 | |||||||
Corporate bonds | 52,405 | 25 | (10 | ) | 52,420 | ||||||||||
Commercial paper | 58,298 | — | — | 58,298 | |||||||||||
Municipal securities | 22,513 | 5 | (25 | ) | 22,493 | ||||||||||
U.S. government securities | 63,674 | 15 | (32 | ) | 63,657 | ||||||||||
Total | $ | 209,974 | $ | 52 | $ | (67 | ) | $ | 209,959 | ||||||
Long-term securities: | |||||||||||||||
U.S. agency securities | $ | 25,306 | $ | — | $ | (37 | ) | $ | 25,269 | ||||||
Corporate bonds | 88,722 | 39 | (88 | ) | 88,673 | ||||||||||
Municipal securities | 20,104 | 9 | (33 | ) | 20,080 | ||||||||||
U.S. government securities | 57,388 | 22 | (97 | ) | 57,313 | ||||||||||
Total | $ | 191,520 | $ | 70 | $ | (255 | ) | $ | 191,335 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Short-term securities: | |||||||||||||||
U.S. agency securities | $ | 9,048 | $ | 7 | $ | — | $ | 9,055 | |||||||
Corporate bonds | 17,318 | — | (20 | ) | 17,298 | ||||||||||
Commercial paper | 6,980 | — | — | 6,980 | |||||||||||
Municipal securities | 8,037 | — | (9 | ) | 8,028 | ||||||||||
U.S. government securities | 18,537 | 3 | — | 18,540 | |||||||||||
Total | $ | 59,920 | $ | 10 | $ | (29 | ) | $ | 59,901 | ||||||
Long-term securities: | |||||||||||||||
U.S. agency securities | $ | 3,502 | $ | — | $ | — | $ | 3,502 | |||||||
Corporate bonds | 12,939 | — | (25 | ) | 12,914 | ||||||||||
Municipal securities | 2,505 | — | (13 | ) | 2,492 | ||||||||||
U.S. government securities | 8,478 | — | (20 | ) | 8,458 | ||||||||||
Total | $ | 27,424 | $ | — | $ | (58 | ) | $ | 27,366 |
Amortized Cost | Fair Value | ||||||
Due in one year or less | $ | 209,974 | $ | 209,959 | |||
Due in one to five years | 191,520 | 191,335 | |||||
Total | $ | 401,494 | $ | 401,294 |
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September 30, 2017 | December 31, 2016 | ||||||
Leasehold improvements | $ | 75,533 | $ | 73,366 | |||
Computer equipment | 61,694 | 52,915 | |||||
Capitalized software | 31,723 | 24,642 | |||||
Office furniture and equipment | 14,313 | 10,737 | |||||
183,263 | 161,660 | ||||||
Less: Accumulated depreciation and amortization | (94,597 | ) | (73,332 | ) | |||
Property and equipment, net | $ | 88,666 | $ | 88,328 |
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Balance at September 30, 2017 | |||||||||||
Cost | Accumulated Amortization | Net | |||||||||
Patents | $ | 1,285 | $ | (533 | ) | $ | 752 | ||||
Technology Assets | 29,158 | (19,843 | ) | 9,315 | |||||||
Customer Assets | 8,886 | (4,305 | ) | 4,581 | |||||||
Total | $ | 39,329 | $ | (24,681 | ) | $ | 14,648 |
Balance at December 31, 2016 | |||||||||||
Cost | Accumulated Amortization | Net | |||||||||
Patents | $ | 1,285 | $ | (454 | ) | $ | 831 | ||||
Technology Assets | 29,075 | (14,702 | ) | 14,373 | |||||||
Customer Assets | 7,745 | (3,657 | ) | 4,088 | |||||||
Total | $ | 38,105 | $ | (18,813 | ) | $ | 19,292 |
2017 (remaining 3 months) | $ | 1,734 | |
2018 | 6,037 | ||
2019 | 3,253 | ||
2020 | 1,296 | ||
2021 | 759 | ||
Thereafter | 1,569 | ||
Total | $ | 14,648 |
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September 30, 2017 | December 31, 2016 | ||||||
Inventory, net | $ | 21,204 | $ | 13,724 | |||
Processing costs receivable | 16,777 | 10,049 | |||||
Prepaid expenses | 7,901 | 7,365 | |||||
Accounts receivable, net | 4,209 | 6,191 | |||||
Deferred hardware costs | 2,648 | 4,546 | |||||
Deferred magstripe reader costs | 2,428 | 3,911 | |||||
Merchant cash advance receivable, net | 356 | 4,212 | |||||
Other | 11,016 | 10,545 | |||||
Total | $ | 66,539 | $ | 60,543 |
September 30, 2017 | December 31, 2016 | ||||||
Accrued payroll | $ | 11,878 | $ | 5,799 | |||
Accrued professional fees | 9,161 | 5,788 | |||||
Accrued advertising and other marketing | 10,482 | 5,008 | |||||
Processing costs payable | 5,766 | 9,655 | |||||
Accrued non income tax liabilities | 4,862 | 3,562 | |||||
Accrued hardware costs | 6,157 | 3,148 | |||||
Other accrued liabilities | 12,320 | 6,583 | |||||
Total | $ | 60,626 | $ | 39,543 |
September 30, 2017 | December 31, 2016 | ||||||
Square Capital payable | $ | 7,472 | $ | 4,907 | |||
Square Payroll payable | 2,350 | 4,769 | |||||
Deferred revenue | 3,424 | 5,407 | |||||
Current portion of deferred rent | 3,207 | 2,862 | |||||
Accrued redemptions | 1,084 | 1,628 | |||||
Other | 3,512 | 2,899 | |||||
Total | $ | 21,049 | $ | 22,472 |
September 30, 2017 | December 31, 2016 | ||||||
Investment in privately held entity (i) | $ | 25,000 | $ | — | |||
Deposits | 2,911 | 1,775 | |||||
Debt Issuance Costs | 858 | 1,063 | |||||
Deferred tax assets | 191 | 306 | |||||
Other | 840 | 50 | |||||
Total | $ | 29,800 | $ | 3,194 |
September 30, 2017 | December 31, 2016 | ||||||
Statutory liabilities | $ | 38,049 | $ | 29,497 | |||
Deferred rent | 21,029 | 23,119 | |||||
Deferred tax liabilities | 476 | 476 | |||||
Other | 6,473 | 4,653 | |||||
Total | $ | 66,027 | $ | 57,745 |
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September 30, 2017 | December 31, 2016 | ||||||
Inventory, net | $ | 21,204 | $ | 13,724 | |||
Processing costs receivable | 16,777 | 10,049 | |||||
Prepaid expenses | 7,901 | 7,365 | |||||
Accounts receivable, net | 4,209 | 6,191 | |||||
Deferred hardware costs | 2,648 | 4,546 | |||||
Deferred magstripe reader costs | 2,428 | 3,911 | |||||
Merchant cash advance receivable, net | 356 | 4,212 | |||||
Other | 11,016 | 10,545 | |||||
Total | $ | 66,539 | $ | 60,543 |
September 30, 2017 | December 31, 2016 | ||||||
Accrued payroll | $ | 11,878 | $ | 5,799 | |||
Accrued professional fees | 9,161 | 5,788 | |||||
Accrued advertising and other marketing | 10,482 | 5,008 | |||||
Processing costs payable | 5,766 | 9,655 | |||||
Accrued non income tax liabilities | 4,862 | 3,562 | |||||
Accrued hardware costs | 6,157 | 3,148 | |||||
Other accrued liabilities | 12,320 | 6,583 | |||||
Total | $ | 60,626 | $ | 39,543 |
September 30, 2017 | December 31, 2016 | ||||||
Square Capital payable | $ | 7,472 | $ | 4,907 | |||
Square Payroll payable | 2,350 | 4,769 | |||||
Deferred revenue | 3,424 | 5,407 | |||||
Current portion of deferred rent | 3,207 | 2,862 | |||||
Accrued redemptions | 1,084 | 1,628 | |||||
Other | 3,512 | 2,899 | |||||
Total | $ | 21,049 | $ | 22,472 |
September 30, 2017 | December 31, 2016 | ||||||
Investment in privately held entity (i) | $ | 25,000 | $ | — | |||
Deposits | 2,911 | 1,775 | |||||
Debt Issuance Costs | 858 | 1,063 | |||||
Deferred tax assets | 191 | 306 | |||||
Other | 840 | 50 | |||||
Total | $ | 29,800 | $ | 3,194 |
September 30, 2017 | December 31, 2016 | ||||||
Statutory liabilities | $ | 38,049 | $ | 29,497 | |||
Deferred rent | 21,029 | 23,119 | |||||
Deferred tax liabilities | 476 | 476 | |||||
Other | 6,473 | 4,653 | |||||
Total | $ | 66,027 | $ | 57,745 |
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September 30, 2017 | |||
Principal | $ | 440,000 | |
Less: unamortized debt discount | (77,291 | ) | |
Less: unamortized debt issuance costs | (8,472 | ) | |
Net carrying amount | $ | 354,237 |
September 30, 2017 | |||
Debt discount related to value of conversion option | $ | 86,203 | |
Less: allocated debt issuance costs | (2,302 | ) | |
Equity component, net | $ | 83,901 |
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2017 | 2017 | ||||||
Contractual interest expense based on 0.375% per annum | $ | 413 | $ | 938 | |||
Amortization of debt discount and issuance costs | 4,277 | 9,889 | |||||
Total | $ | 4,690 | $ | 10,827 | |||
Effective interest rate of the liability component | 5.34 | % | 5.34 | % |
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Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Accrued transaction losses, beginning of the period | $ | 22,455 | $ | 16,093 | $ | 20,064 | $ | 17,176 | |||||||
Provision for transaction losses | 15,102 | 13,483 | 39,737 | 36,875 | |||||||||||
Charge-offs to accrued transaction losses | (10,837 | ) | (8,148 | ) | (33,081 | ) | (32,623 | ) | |||||||
Accrued transaction losses, end of the period | $ | 26,720 | $ | 21,428 | $ | 26,720 | $ | 21,428 |
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Total stockholders’ equity | |||
Balance at December 31, 2016 | $ | 576,153 | |
Net loss | (47,150 | ) | |
Exercise of stock options | 104,251 | ||
Purchases under the employee stock purchase plan | 7,767 | ||
Vesting of early exercised stock options and other | 563 | ||
Share-based compensation | 113,826 | ||
Tax withholding related to vesting of restricted stock units | (18,298 | ) | |
Conversion feature of convertible senior notes, due 2022, net of allocated debt issuance costs | 83,901 | ||
Purchase of bond hedges in conjunction with issuance of convertible senior notes, due 2022 | (92,136 | ) | |
Sale of warrants in conjunction with issuance of convertible senior notes, due 2022 | 57,244 | ||
Payment for termination of Starbucks warrant | (54,808 | ) | |
Change in other comprehensive loss | 1,596 | ||
Balance at September 30, 2017 | $ | 732,909 |
Number of Stock Options Outstanding | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | |||||||||
Balance at December 31, 2016 | 73,261,562 | $ | 7.70 | 7.28 | $ | 443,711 | ||||||
Granted | 1,216,959 | 17.20 | ||||||||||
Exercised | (19,050,042 | ) | 5.47 | |||||||||
Forfeited | (2,423,888 | ) | 11.42 | |||||||||
Balance at September 30, 2017 | 53,004,591 | $ | 8.55 | 6.76 | $ | 1,073,815 | ||||||
Options exercisable as of | ||||||||||||
September 30, 2017 | 49,642,480 | $ | 8.26 | 6.63 | $ | 1,020,272 |
Number of RSUs | Weighted Average Grant Date Fair Value | |||||
Unvested as of December 31, 2016 | 15,443,391 | $ | 12.09 | |||
Granted | 12,241,086 | 18.81 | ||||
Vested | (4,145,734 | ) | 12.37 | |||
Forfeited | (1,989,820 | ) | 12.90 | |||
Unvested as of September 30, 2017 | 21,548,923 | $ | 15.78 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2016 | 2017 | 2016 | ||||||
Dividend yield | — | % | — | % | — | % | ||
Risk-free interest rate | 1.31 | % | 1.88 | % | 1.54 | % | ||
Expected volatility | 43.51 | % | 32.22 | % | 42.74 | % | ||
Expected term (years) | 6.08 | 6.02 | 6.08 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Cost of revenue | $ | 29 | $ | — | $ | 47 | $ | — | |||||||
Product development | 25,254 | 23,949 | 69,746 | 70,064 | |||||||||||
Sales and marketing | 4,579 | 3,697 | 12,869 | 9,963 | |||||||||||
General and administrative | 10,186 | 9,133 | 28,649 | 24,872 | |||||||||||
Total | $ | 40,048 | $ | 36,779 | $ | 111,311 | $ | 104,899 |
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Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net loss | $ | (16,098 | ) | $ | (32,323 | ) | $ | (47,150 | ) | $ | (156,423 | ) | |||
Basic shares: | |||||||||||||||
Weighted-average common shares outstanding | 385,409 | 346,299 | 377,374 | 339,728 | |||||||||||
Weighted-average unvested shares | (1,458 | ) | (2,406 | ) | (1,631 | ) | (3,135 | ) | |||||||
Weighted-average shares used to compute basic net loss per share | 383,951 | 343,893 | 375,743 | 336,593 | |||||||||||
Diluted shares: | |||||||||||||||
Weighted-average shares used to compute diluted loss per share | 383,951 | 343,893 | 375,743 | 336,593 | |||||||||||
Net loss per share: | |||||||||||||||
Basic | $ | (0.04 | ) | $ | (0.09 | ) | $ | (0.13 | ) | $ | (0.46 | ) | |||
Diluted | $ | (0.04 | ) | $ | (0.09 | ) | $ | (0.13 | ) | $ | (0.46 | ) |
Three and Nine Months Ended September 30, | |||||
2017 | 2016 | ||||
Stock options and restricted stock units | 74,554 | 101,972 | |||
Common stock warrants | 19,173 | 9,458 | |||
Unvested shares | 1,446 | 1,997 | |||
Employee stock purchase plan | 642 | 637 | |||
Total anti-dilutive securities | 95,815 | 114,064 |
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Capital | Operating | ||||||
Year: | |||||||
2017 (remaining 3 months) | $ | 376 | $ | 4,381 | |||
2018 | 1,495 | 18,001 | |||||
2019 | 1,380 | 16,911 | |||||
2020 | 142 | 16,905 | |||||
2021 | — | 16,626 | |||||
Thereafter | — | 36,088 | |||||
Total | $ | 3,393 | $ | 108,912 | |||
Less amount representing interest | (1 | ) | |||||
Present value of capital lease obligations | 3,392 | ||||||
Less current portion of capital lease obligation | (1,500 | ) | |||||
Non-current portion of capital lease obligation | $ | 1,892 |
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Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenue | |||||||||||||||
United States | $ | 559,053 | $ | 421,317 | $ | 1,533,960 | $ | 1,210,704 | |||||||
International | 26,106 | 17,685 | 64,258 | 46,100 | |||||||||||
Total net revenue | $ | 585,159 | $ | 439,002 | $ | 1,598,218 | $ | 1,256,804 |
September 30, 2017 | December 31, 2016 | ||||||
Long-lived assets | |||||||
United States | $ | 156,850 | $ | 162,118 | |||
International | 4,425 | 2,675 | |||||
Total long-lived assets | $ | 161,275 | $ | 164,793 |
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Nine Months Ended September 30, | |||||||
2017 | 2016 | ||||||
Supplemental Cash Flow Data: | |||||||
Cash paid for interest | $ | 1,230 | $ | 428 | |||
Cash paid for income taxes | 1,117 | 321 | |||||
Supplemental disclosures of non-cash investing and financing activities: | |||||||
Change in purchases of property and equipment in accounts payable and accrued expenses | (123 | ) | 1,310 | ||||
Unpaid business acquisition purchase price | 644 | — |
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September 30, 2017 | December 31, 2016 | ||||||||||||||
Carrying Value | Fair Value (Level 3) | Carrying Value | Fair Value (Level 3) | ||||||||||||
Loans held for sale | $ | 58,331 | $ | 60,375 | $ | 42,144 | $ | 42,633 | |||||||
Total | $ | 58,331 | $ | 60,375 | $ | 42,144 | $ | 42,633 |
September 30, 2017 | December 31, 2016 | ||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Level 1 | Level 2 | Level 3 | ||||||||||||||||||
Cash and Cash Equivalents: | |||||||||||||||||||||||
Money market funds | $ | 384,546 | $ | — | $ | — | $ | 207,168 | $ | — | $ | — | |||||||||||
U.S. agency securities | — | — | — | — | — | — | |||||||||||||||||
Commercial paper | — | — | — | — | 7,496 | — | |||||||||||||||||
U.S. government securities | — | — | — | — | — | — | |||||||||||||||||
Corporate bonds | — | — | — | — | — | — | |||||||||||||||||
Municipal securities | — | — | — | — | 1,000 | — | |||||||||||||||||
Short-term securities: | |||||||||||||||||||||||
U.S. agency securities | — | 13,091 | — | — | 9,055 | — | |||||||||||||||||
Corporate bonds | — | 52,420 | — | — | 6,980 | — | |||||||||||||||||
Commercial paper | — | 58,298 | — | — | 17,298 | — | |||||||||||||||||
Municipal securities | — | 22,493 | — | — | 8,028 | — | |||||||||||||||||
U.S. government securities | 63,657 | — | 18,540 | — | — | ||||||||||||||||||
Long-term securities: | |||||||||||||||||||||||
U.S. agency securities | — | 25,269 | — | — | 3,502 | — | |||||||||||||||||
Corporate bonds | — | 88,673 | — | — | 12,914 | — | |||||||||||||||||
Municipal securities | — | 20,080 | — | — | 2,492 | — | |||||||||||||||||
U.S. government securities | 57,313 | — | — | 8,458 | — | — | |||||||||||||||||
Total | $ | 505,516 | $ | 280,324 | $ | — | $ | 234,166 | $ | 68,765 | $ | — |
September 30, 2017 | |||||||
Carrying Value | Fair Value (Level 2) | ||||||
Convertible senior notes | $ | 354,237 | $ | 616,000 | |||
Total | $ | 354,237 | $ | 616,000 |
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Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Short-term securities: | |||||||||||||||
U.S. agency securities | $ | 13,084 | $ | 7 | $ | — | $ | 13,091 | |||||||
Corporate bonds | 52,405 | 25 | (10 | ) | 52,420 | ||||||||||
Commercial paper | 58,298 | — | — | 58,298 | |||||||||||
Municipal securities | 22,513 | 5 | (25 | ) | 22,493 | ||||||||||
U.S. government securities | 63,674 | 15 | (32 | ) | 63,657 | ||||||||||
Total | $ | 209,974 | $ | 52 | $ | (67 | ) | $ | 209,959 | ||||||
Long-term securities: | |||||||||||||||
U.S. agency securities | $ | 25,306 | $ | — | $ | (37 | ) | $ | 25,269 | ||||||
Corporate bonds | 88,722 | 39 | (88 | ) | 88,673 | ||||||||||
Municipal securities | 20,104 | 9 | (33 | ) | 20,080 | ||||||||||
U.S. government securities | 57,388 | 22 | (97 | ) | 57,313 | ||||||||||
Total | $ | 191,520 | $ | 70 | $ | (255 | ) | $ | 191,335 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
Short-term securities: | |||||||||||||||
U.S. agency securities | $ | 9,048 | $ | 7 | $ | — | $ | 9,055 | |||||||
Corporate bonds | 17,318 | — | (20 | ) | 17,298 | ||||||||||
Commercial paper | 6,980 | — | — | 6,980 | |||||||||||
Municipal securities | 8,037 | — | (9 | ) | 8,028 | ||||||||||
U.S. government securities | 18,537 | 3 | — | 18,540 | |||||||||||
Total | $ | 59,920 | $ | 10 | $ | (29 | ) | $ | 59,901 | ||||||
Long-term securities: | |||||||||||||||
U.S. agency securities | $ | 3,502 | $ | — | $ | — | $ | 3,502 | |||||||
Corporate bonds | 12,939 | — | (25 | ) | 12,914 | ||||||||||
Municipal securities | 2,505 | — | (13 | ) | 2,492 | ||||||||||
U.S. government securities | 8,478 | — | (20 | ) | 8,458 | ||||||||||
Total | $ | 27,424 | $ | — | $ | (58 | ) | $ | 27,366 |
Amortized Cost | Fair Value | ||||||
Due in one year or less | $ | 209,974 | $ | 209,959 | |||
Due in one to five years | 191,520 | 191,335 | |||||
Total | $ | 401,494 | $ | 401,294 |
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September 30, 2017 | December 31, 2016 | ||||||
Leasehold improvements | $ | 75,533 | $ | 73,366 | |||
Computer equipment | 61,694 | 52,915 | |||||
Capitalized software | 31,723 | 24,642 | |||||
Office furniture and equipment | 14,313 | 10,737 | |||||
183,263 | 161,660 | ||||||
Less: Accumulated depreciation and amortization | (94,597 | ) | (73,332 | ) | |||
Property and equipment, net | $ | 88,666 | $ | 88,328 |
|
Balance at September 30, 2017 | |||||||||||
Cost | Accumulated Amortization | Net | |||||||||
Patents | $ | 1,285 | $ | (533 | ) | $ | 752 | ||||
Technology Assets | 29,158 | (19,843 | ) | 9,315 | |||||||
Customer Assets | 8,886 | (4,305 | ) | 4,581 | |||||||
Total | $ | 39,329 | $ | (24,681 | ) | $ | 14,648 |
Balance at December 31, 2016 | |||||||||||
Cost | Accumulated Amortization | Net | |||||||||
Patents | $ | 1,285 | $ | (454 | ) | $ | 831 | ||||
Technology Assets | 29,075 | (14,702 | ) | 14,373 | |||||||
Customer Assets | 7,745 | (3,657 | ) | 4,088 | |||||||
Total | $ | 38,105 | $ | (18,813 | ) | $ | 19,292 |
2017 (remaining 3 months) | $ | 1,734 | |
2018 | 6,037 | ||
2019 | 3,253 | ||
2020 | 1,296 | ||
2021 | 759 | ||
Thereafter | 1,569 | ||
Total | $ | 14,648 |
|
September 30, 2017 | December 31, 2016 | ||||||
Inventory, net | $ | 21,204 | $ | 13,724 | |||
Processing costs receivable | 16,777 | 10,049 | |||||
Prepaid expenses | 7,901 | 7,365 | |||||
Accounts receivable, net | 4,209 | 6,191 | |||||
Deferred hardware costs | 2,648 | 4,546 | |||||
Deferred magstripe reader costs | 2,428 | 3,911 | |||||
Merchant cash advance receivable, net | 356 | 4,212 | |||||
Other | 11,016 | 10,545 | |||||
Total | $ | 66,539 | $ | 60,543 |
September 30, 2017 | December 31, 2016 | ||||||
Accrued payroll | $ | 11,878 | $ | 5,799 | |||
Accrued professional fees | 9,161 | 5,788 | |||||
Accrued advertising and other marketing | 10,482 | 5,008 | |||||
Processing costs payable | 5,766 | 9,655 | |||||
Accrued non income tax liabilities | 4,862 | 3,562 | |||||
Accrued hardware costs | 6,157 | 3,148 | |||||
Other accrued liabilities | 12,320 | 6,583 | |||||
Total | $ | 60,626 | $ | 39,543 |
September 30, 2017 | December 31, 2016 | ||||||
Square Capital payable | $ | 7,472 | $ | 4,907 | |||
Square Payroll payable | 2,350 | 4,769 | |||||
Deferred revenue | 3,424 | 5,407 | |||||
Current portion of deferred rent | 3,207 | 2,862 | |||||
Accrued redemptions | 1,084 | 1,628 | |||||
Other | 3,512 | 2,899 | |||||
Total | $ | 21,049 | $ | 22,472 |
|
September 30, 2017 | December 31, 2016 | ||||||
Investment in privately held entity (i) | $ | 25,000 | $ | — | |||
Deposits | 2,911 | 1,775 | |||||
Debt Issuance Costs | 858 | 1,063 | |||||
Deferred tax assets | 191 | 306 | |||||
Other | 840 | 50 | |||||
Total | $ | 29,800 | $ | 3,194 |
September 30, 2017 | December 31, 2016 | ||||||
Statutory liabilities | $ | 38,049 | $ | 29,497 | |||
Deferred rent | 21,029 | 23,119 | |||||
Deferred tax liabilities | 476 | 476 | |||||
Other | 6,473 | 4,653 | |||||
Total | $ | 66,027 | $ | 57,745 |
|
September 30, 2017 | |||
Principal | $ | 440,000 | |
Less: unamortized debt discount | (77,291 | ) | |
Less: unamortized debt issuance costs | (8,472 | ) | |
Net carrying amount | $ | 354,237 |
September 30, 2017 | |||
Debt discount related to value of conversion option | $ | 86,203 | |
Less: allocated debt issuance costs | (2,302 | ) | |
Equity component, net | $ | 83,901 |
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2017 | 2017 | ||||||
Contractual interest expense based on 0.375% per annum | $ | 413 | $ | 938 | |||
Amortization of debt discount and issuance costs | 4,277 | 9,889 | |||||
Total | $ | 4,690 | $ | 10,827 | |||
Effective interest rate of the liability component | 5.34 | % | 5.34 | % |
|
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Accrued transaction losses, beginning of the period | $ | 22,455 | $ | 16,093 | $ | 20,064 | $ | 17,176 | |||||||
Provision for transaction losses | 15,102 | 13,483 | 39,737 | 36,875 | |||||||||||
Charge-offs to accrued transaction losses | (10,837 | ) | (8,148 | ) | (33,081 | ) | (32,623 | ) | |||||||
Accrued transaction losses, end of the period | $ | 26,720 | $ | 21,428 | $ | 26,720 | $ | 21,428 |
|
Total stockholders’ equity | |||
Balance at December 31, 2016 | $ | 576,153 | |
Net loss | (47,150 | ) | |
Exercise of stock options | 104,251 | ||
Purchases under the employee stock purchase plan | 7,767 | ||
Vesting of early exercised stock options and other | 563 | ||
Share-based compensation | 113,826 | ||
Tax withholding related to vesting of restricted stock units | (18,298 | ) | |
Conversion feature of convertible senior notes, due 2022, net of allocated debt issuance costs | 83,901 | ||
Purchase of bond hedges in conjunction with issuance of convertible senior notes, due 2022 | (92,136 | ) | |
Sale of warrants in conjunction with issuance of convertible senior notes, due 2022 | 57,244 | ||
Payment for termination of Starbucks warrant | (54,808 | ) | |
Change in other comprehensive loss | 1,596 | ||
Balance at September 30, 2017 | $ | 732,909 |
Number of Stock Options Outstanding | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | |||||||||
Balance at December 31, 2016 | 73,261,562 | $ | 7.70 | 7.28 | $ | 443,711 | ||||||
Granted | 1,216,959 | 17.20 | ||||||||||
Exercised | (19,050,042 | ) | 5.47 | |||||||||
Forfeited | (2,423,888 | ) | 11.42 | |||||||||
Balance at September 30, 2017 | 53,004,591 | $ | 8.55 | 6.76 | $ | 1,073,815 | ||||||
Options exercisable as of | ||||||||||||
September 30, 2017 | 49,642,480 | $ | 8.26 | 6.63 | $ | 1,020,272 |
Number of RSUs | Weighted Average Grant Date Fair Value | |||||
Unvested as of December 31, 2016 | 15,443,391 | $ | 12.09 | |||
Granted | 12,241,086 | 18.81 | ||||
Vested | (4,145,734 | ) | 12.37 | |||
Forfeited | (1,989,820 | ) | 12.90 | |||
Unvested as of September 30, 2017 | 21,548,923 | $ | 15.78 |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||
2016 | 2017 | 2016 | ||||||
Dividend yield | — | % | — | % | — | % | ||
Risk-free interest rate | 1.31 | % | 1.88 | % | 1.54 | % | ||
Expected volatility | 43.51 | % | 32.22 | % | 42.74 | % | ||
Expected term (years) | 6.08 | 6.02 | 6.08 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Cost of revenue | $ | 29 | $ | — | $ | 47 | $ | — | |||||||
Product development | 25,254 | 23,949 | 69,746 | 70,064 | |||||||||||
Sales and marketing | 4,579 | 3,697 | 12,869 | 9,963 | |||||||||||
General and administrative | 10,186 | 9,133 | 28,649 | 24,872 | |||||||||||
Total | $ | 40,048 | $ | 36,779 | $ | 111,311 | $ | 104,899 |
|
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Net loss | $ | (16,098 | ) | $ | (32,323 | ) | $ | (47,150 | ) | $ | (156,423 | ) | |||
Basic shares: | |||||||||||||||
Weighted-average common shares outstanding | 385,409 | 346,299 | 377,374 | 339,728 | |||||||||||
Weighted-average unvested shares | (1,458 | ) | (2,406 | ) | (1,631 | ) | (3,135 | ) | |||||||
Weighted-average shares used to compute basic net loss per share | 383,951 | 343,893 | 375,743 | 336,593 | |||||||||||
Diluted shares: | |||||||||||||||
Weighted-average shares used to compute diluted loss per share | 383,951 | 343,893 | 375,743 | 336,593 | |||||||||||
Net loss per share: | |||||||||||||||
Basic | $ | (0.04 | ) | $ | (0.09 | ) | $ | (0.13 | ) | $ | (0.46 | ) | |||
Diluted | $ | (0.04 | ) | $ | (0.09 | ) | $ | (0.13 | ) | $ | (0.46 | ) |
Three and Nine Months Ended September 30, | |||||
2017 | 2016 | ||||
Stock options and restricted stock units | 74,554 | 101,972 | |||
Common stock warrants | 19,173 | 9,458 | |||
Unvested shares | 1,446 | 1,997 | |||
Employee stock purchase plan | 642 | 637 | |||
Total anti-dilutive securities | 95,815 | 114,064 |
|
Capital | Operating | ||||||
Year: | |||||||
2017 (remaining 3 months) | $ | 376 | $ | 4,381 | |||
2018 | 1,495 | 18,001 | |||||
2019 | 1,380 | 16,911 | |||||
2020 | 142 | 16,905 | |||||
2021 | — | 16,626 | |||||
Thereafter | — | 36,088 | |||||
Total | $ | 3,393 | $ | 108,912 | |||
Less amount representing interest | (1 | ) | |||||
Present value of capital lease obligations | 3,392 | ||||||
Less current portion of capital lease obligation | (1,500 | ) | |||||
Non-current portion of capital lease obligation | $ | 1,892 |
|
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenue | |||||||||||||||
United States | $ | 559,053 | $ | 421,317 | $ | 1,533,960 | $ | 1,210,704 | |||||||
International | 26,106 | 17,685 | 64,258 | 46,100 | |||||||||||
Total net revenue | $ | 585,159 | $ | 439,002 | $ | 1,598,218 | $ | 1,256,804 |
September 30, 2017 | December 31, 2016 | ||||||
Long-lived assets | |||||||
United States | $ | 156,850 | $ | 162,118 | |||
International | 4,425 | 2,675 | |||||
Total long-lived assets | $ | 161,275 | $ | 164,793 |
|
Nine Months Ended September 30, | |||||||
2017 | 2016 | ||||||
Supplemental Cash Flow Data: | |||||||
Cash paid for interest | $ | 1,230 | $ | 428 | |||
Cash paid for income taxes | 1,117 | 321 | |||||
Supplemental disclosures of non-cash investing and financing activities: | |||||||
Change in purchases of property and equipment in accounts payable and accrued expenses | (123 | ) | 1,310 | ||||
Unpaid business acquisition purchase price | 644 | — |
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