Document and Entity Information - shares |
3 Months Ended | |
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Mar. 31, 2019 |
May 03, 2019 |
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Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | GRUB | |
Entity Registrant Name | GRUBHUB INC. | |
Entity Central Index Key | 0001594109 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 91,177,437 |
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Mar. 31, 2019 |
Dec. 31, 2018 |
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Statement Of Financial Position [Abstract] | ||
Preferred Stock, par value | $ 0.0001 | $ 0.0001 |
Preferred Stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Preferred Stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 91,074,285 | 90,756,548 |
Common stock, shares outstanding | 91,074,285 | 90,756,548 |
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | |
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Mar. 31, 2019 |
Mar. 31, 2018 |
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Income Statement [Abstract] | ||
Revenues | $ 323,770 | $ 232,570 |
Costs and expenses: | ||
Operations and support | 161,350 | 96,283 |
Sales and marketing | 78,454 | 48,756 |
Technology (exclusive of amortization) | 27,250 | 17,331 |
General and administrative | 22,787 | 17,697 |
Depreciation and amortization | 25,089 | 20,951 |
Total costs and expenses | 314,930 | 201,018 |
Income from operations | 8,840 | 31,552 |
Interest expense - net | 2,812 | 1,022 |
Income before provision for income taxes | 6,028 | 30,530 |
Income tax benefit | (862) | (236) |
Net income attributable to common stockholders | $ 6,890 | $ 30,766 |
Net income per share attributable to common stockholders: | ||
Basic | $ 0.08 | $ 0.35 |
Diluted | $ 0.07 | $ 0.34 |
Weighted-average shares used to compute net income per share attributable to common stockholders: | ||
Basic | 90,951 | 87,085 |
Diluted | 92,918 | 90,091 |
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands |
3 Months Ended | |
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Mar. 31, 2019 |
Mar. 31, 2018 |
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Statement Of Income And Comprehensive Income [Abstract] | ||
Net income | $ 6,890 | $ 30,766 |
OTHER COMPREHENSIVE INCOME | ||
Foreign currency translation adjustments | 227 | 356 |
COMPREHENSIVE INCOME | $ 7,117 | $ 31,122 |
Organization |
3 Months Ended |
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Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization |
1. Organization Grubhub Inc., a Delaware corporation, and its wholly-owned subsidiaries (collectively referred to as the “Company”) provide an online and mobile takeout marketplace for restaurant pick-up and delivery orders. The Company connects diners and restaurants through restaurant technology and easy-to-use platforms. Diners enter their delivery address or use geo-location within the mobile applications and the Company displays the menus and other relevant information for restaurants in its network. Orders may be placed directly online, via mobile applications or over the phone. The Company primarily charges the restaurant a per order commission that is largely fee based. In many markets, the Company also provides delivery services to restaurants on its platform that do not have their own delivery operations. The Company’s takeout marketplace, and related platforms where the Company provides marketing services to generate orders, are collectively referred to as the “Platform”. |
Significant Accounting Policies |
3 Months Ended |
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Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies |
2. Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated interim financial statements include the accounts of Grubhub Inc. and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited condensed consolidated interim financial statements include all wholly-owned subsidiaries and reflect all normal and recurring adjustments, as well as any other than normal adjustments, that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 filed with the SEC on February 28, 2019 (the “2018 Form 10-K”). All significant intercompany transactions have been eliminated in consolidation. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2019. Use of Estimates The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Significant items subject to such estimates, judgments and assumptions include revenue recognition, website and internal-use software development costs, goodwill, recoverability of intangible assets with finite lives and other long-lived assets, stock-based compensation, and income taxes. Actual results could differ from these estimates. Changes in Accounting Principle See “Recently Issued Accounting Pronouncements” below for a description of accounting principle changes adopted during the three months ended March 31, 2019 related to leases. There have been no other material changes to the Company’s significant accounting policies described in the 2018 Form 10-K. Recently Issued Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables and held-to-maturity debt securities, which will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. This ASU also expands disclosure requirements. ASU 2016-13 is effective for the Company beginning in the first quarter of 2020 and early adoption is permitted. The guidance will be applied using the modified-retrospective approach. The adoption of ASU 2016-13 is not expected to have a material impact on the Company’s consolidated financial position, results of operations or cash flows. In February 2016, and in subsequent updates, the FASB issued Accounting Standards Codification Topic 842, Leases (“ASC Topic 842”). Under ASC Topic 842, a lessee recognizes a liability to make lease payments and a right-of-use asset for all leases (with the exception of short-term leases) in the statement of financial position at the commencement date. ASC Topic 842 was effective for and adopted by the Company in the first quarter of 2019. The Company adopted ASC Topic 842 using the modified retrospective transition method applied to all existing leases beginning January 1, 2019. Periods prior to adoption were not adjusted and continue to be reported in accordance with historic accounting guidance under ASC Topic 840. The Company elected the optional practical expedient package which, among other things, includes retaining the historical classification of leases. The adoption of ASC Topic 842 resulted in the recognition on the condensed consolidated balance sheets as of January 1, 2019 of right-of-use assets of $81.2 million and lease liabilities for operating leases of $97.7 million, but did not result in a cumulative-effect adjustment on retained earnings. The operating lease right-of-use asset includes the impact upon adoption of ASC Topic 842 of the derecognition of lease incentives, deferred rent, below-market lease intangibles, cease-use liabilities and prepaid rent balances recognized in prepaid expenses and other current assets and current and noncurrent other accruals on the consolidated balance sheets as of December 31, 2018. The adoption of ASC Topic 842 did not have and is not expected to have a material impact to the Company's consolidated results of operations or cash flows. See Note 7, Commitments and Contingencies, for additional details. |
Acquisitions |
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Acquisitions |
3. Acquisitions There were no acquisitions during the three months ended March 31, 2019. 2018 Acquisitions On November 7, 2018, the Company acquired all of the issued and outstanding shares of Tapingo Ltd. (“Tapingo”) for approximately $152.1 million, including $151.7 million of cash paid (net of cash acquired of $1.5 million) and $0.4 million of other non-cash consideration. Tapingo is a leading platform for campus food ordering with direct integration into college meal plans and point of sale systems. The acquisition of Tapingo has enhanced the Company’s diner network on college campuses. On September 13, 2018, the Company acquired SCVNGR, Inc. d/b/a LevelUp (“LevelUp”) for approximately $369.4 million, including $366.8 million of cash paid (net of cash acquired of $6.0 million) and $2.6 million of other non-cash consideration. LevelUp is a leading provider of mobile diner engagement and payment solutions for national and regional restaurant brands. The acquisition of LevelUp has simplified the Company’s integrations with restaurants’ systems, increased diner engagement and accelerated product development. The Company assumed Tapingo and LevelUp employees’ unvested incentive stock option (“ISO”) awards as of the respective closing dates. Approximately $0.4 million and $2.6 million of the fair value of the assumed ISO awards granted to acquired Tapingo and LevelUp employees, respectively, was attributable to the pre-combination services of the awardees and was included in the respective purchase prices. These amounts are reflected within goodwill in the respective purchase price allocations. As of the respective acquisition dates, aggregate post-combination expense of approximately $21.4 million was expected to be recognized related to the combined assumed ISO awards over the remaining post-combination service period. The results of operations of Tapingo and LevelUp have been included in the Company’s financial statements since November 7, 2018 and September 13, 2018, respectively. The excess of the consideration transferred in the acquisitions over the amounts assigned to the fair value of the assets was recorded as goodwill, which represents the value of LevelUp’s technology team, the ability to simplify integrations with restaurants on the Company’s platform, and the expanded breadth and depth of the Company’s network of diners and campus relationships. The total goodwill related to the acquisitions of Tapingo and LevelUp of $415.5 million is not deductible for income tax purposes. The assets acquired and liabilities assumed of Tapingo and LevelUp were recorded at their estimated fair values as of the closing dates of November 7, 2018 and September 13, 2018, respectively. The purchase price allocations for Tapingo and LevelUp are subject to change within the measurement period as certain significant fair value estimates are subject to management review and approval. See Note 5, Goodwill and Acquired Intangible Assets, for a description of changes to the purchase price allocations for Tapingo and LevelUp during the three months ended March 31, 2019. The following table summarizes the preliminary purchase price allocation acquisition-date fair values of the asset and liabilities acquired in connection with the Tapingo and LevelUp acquisitions:
Additional Information The estimated fair values of the intangible assets acquired were determined based on a combination of the income, cost, and market approaches to measure the fair value of the restaurant relationships, diner acquisition and developed technology as follows:
The fair value of the LevelUp below-market lease was measured based on the present value of the difference between the contractual amounts to be paid pursuant to the lease and an estimate of current fair market lease rates measured over the non-cancelable remaining term of the lease. As of January 1, 2019, the below-market lease intangible asset was derecognized from acquired intangible assets resulting in a corresponding adjustment to the opening balance of operating lease right-of-use assets on the condensed consolidated balance sheets upon adoption of ASC Topic 842. These fair value measurements were based on significant inputs not observable in the market and thus represent Level 3 measurements within the fair value hierarchy. The Company incurred certain expenses directly and indirectly related to acquisitions which were recognized in general and administrative expenses within the condensed consolidated statements of operations for the three months ended March 31, 2019 and 2018 of $0.5 million and $1.3 million, respectively. Pro Forma (unaudited) The following unaudited pro forma information presents a summary of the operating results of the Company for the three months ended March 31, 2018 as if the acquisitions of Tapingo and LevelUp had occurred as of January 1 of the year prior to acquisition:
The pro forma adjustments that reflect the amortization that would have been recognized for intangible assets, elimination of transaction costs incurred, stock-based compensation expense for assumed equity awards and interest expense for transaction financings, as well as the pro forma tax impact of such adjustments for the three months ended March 31, 2018 were as follows:
The unaudited pro forma revenues and net income are not intended to represent or be indicative of the Company’s condensed consolidated results of operations or financial condition that would have been reported had the acquisitions been completed as of the beginning of the period presented and should not be taken as indicative of the Company’s future consolidated results of operations or financial condition. |
Marketable Securities |
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Investments Debt And Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketable Securities |
4. Marketable Securities The amortized cost, unrealized gains and losses and estimated fair value of the Company’s held-to-maturity marketable securities as of March 31, 2019 and December 31, 2018 were as follows:
All of the Company’s marketable securities were classified as held-to-maturity investments and have maturities within one year of March 31, 2019. The gross unrealized losses, estimated fair value and length of time the individual marketable securities were in a continuous loss position for those marketable securities in an unrealized loss position as of March 31, 2019 and December 31, 2018 were as follows:
The Company recognized interest income during the three months ended March 31, 2019 and 2018 of $0.7 million and $0.6 million, respectively, within net interest expense on the condensed consolidated statements of operations. During the three months ended March 31, 2019 and 2018, the Company did not recognize any other-than-temporary impairment losses related to its marketable securities. The Company’s marketable securities are classified within Level 2 of the fair value hierarchy (see Note 13, Fair Value Measurement, for further details). |
Goodwill and Acquired Intangible Assets |
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Goodwill And Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Acquired Intangible Assets |
5. Goodwill and Acquired Intangible Assets The components of acquired intangible assets as of March 31, 2019 and December 31, 2018 were as follows:
Upon adoption of ASC Topic 842, the acquired below-market lease intangible was derecognized resulting in a corresponding adjustment to the operating lease right-of-use asset within the condensed consolidated balance sheets as of January 1, 2019. Amortization of the acquired below-market lease intangible was recognized as rent expense within the condensed consolidated statements of operations. See Note 7, Commitments and Contingencies, for further details. Amortization expense for acquired intangible assets recognized within depreciation and amortization on the condensed consolidated statements of operations was $11.9 million and $11.5 million for the three months ended March 31, 2019 and 2018, respectively.
The change in the carrying amount of goodwill during the three months ended March 31, 2019 related to changes in the fair value of net deferred tax assets for the purchase price allocations of the Tapingo and LevelUp acquisitions during the measurement period were as follows:
Estimated future amortization expense of acquired intangible assets as of March 31, 2019 was as follows:
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Property and Equipment |
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Property Plant And Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and Equipment |
6. Property and Equipment The components of the Company’s property and equipment as of March 31, 2019 and December 31, 2018 were as follows:
The Company recorded depreciation and amortization expense for property and equipment other than developed software of $6.2 million and $5.1 million for the three months ended March 31, 2019 and 2018, respectively. The Company capitalized developed software costs of $14.5 million and $8.2 million for the three months ended March 31, 2019 and 2018, respectively. Amortization expense for developed software costs, recognized in depreciation and amortization in the condensed consolidated statements of operations, for the three months ended March 31, 2019 and 2018 was $7.0 million and $4.4 million, respectively. |
Commitments and Contingencies |
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Commitments And Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies |
7. Commitments and Contingencies Leases As of March 31, 2019, the Company had operating lease agreements for its office facilities in various locations throughout the U.S, as well as in the U.K. and Israel, which expire at various dates through September 2029. The terms of the lease agreements provide for fixed rental payments on a graduated basis. For its primary operating leases, the Company can, after the initial lease term, renew its leases under right of first offer terms at fair value at the time of renewal for a period of five years. The Company's lease term includes options to extend or terminate the lease when it is reasonably certain that it will exercise that option. The Company determines if an arrangement is a lease at inception of a contract. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Non-lease components associated with lease components in the Company’s lease contracts are treated as a single lease component. As of March 31, 2019, the Company recognized on its condensed consolidated balance sheets operating lease right-of-use assets of $78.7 million that represent the Company's right to use an underlying asset during the lease term and current and noncurrent operating lease liabilities of $13.4 million and $82.4 million, respectively, that represent the Company's obligation to make lease payments. Operating lease right-of-use assets and liabilities commencing after January 1, 2019 are recognized at commencement date based on the present value of lease payments over the lease term. Because the rate implicit in each lease is not readily determinable, the Company uses its incremental borrowing rate to determine the present value of the lease payments. To determine the incremental borrowing rate, the Company uses information including the risk-free interest rate for the remaining lease term, the Company’s implied credit rating and interest rates of similar debt instruments of entities with comparable credit ratings. The Company recognizes rent expense on a straight-line basis over the lease term, which is allocated on a headcount basis to operations and support, sales and marketing, technology and general and administrative costs and expenses in the condensed consolidated statements of operations. The components of lease costs, which consists of rent expense for leased office space, during the three months ended March 31, 2019 were as follows:
Supplemental cash flow information related to the Company’s operating leases as well as the weighted-average lease term and discount rate as of March 31, 2019, were as follows:
Future minimum lease payments under the Company’s operating lease agreements as of March 31, 2019 were as follows:
The table above does not reflect the Company’s option to exercise early termination rights or the payment of related early termination fees. Additionally, as of March 31, 2019, the Company had future obligations for office facilities of approximately $27 million that have not yet commenced, and as such, have not been recognized on the Company's condensed consolidated balance sheets or included in the table above. This operating lease, with an eleven year term, is expected to commence in 2019.
As previously reported in the 2018 Form 10-K under ASC Topic 840, future minimum lease payments under the Company’s operating lease agreements that had initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2018 were as follows:
Legal In August 2011, Ameranth, Inc. (“Ameranth”) filed a patent infringement action against a number of defendants, including Grubhub Holdings Inc., in the U.S. District Court for the Southern District of California, Case No. 3:11-cv-1810. Ameranth subsequently initiated additional actions for infringement of a related patent, including separate actions against Grubhub Holdings Inc., Case No. 3:12-cv-739, and Seamless North America, LLC, Case No. 3:12-cv-737, which were consolidated along with approximately 40 other cases Ameranth filed in the same district. In September 2018, the district court granted summary judgment (on another defendant’s motion) of unpatentability on the sole remaining patent and vacated the December 3, 2018 jury trial date for the claims against Grubhub Holdings Inc. and Seamless North America, LLC. In October 2018, the district court entered final judgment on all claims in the case in which summary judgment was granted, and then stayed the remaining cases (including the cases against Grubhub and Seamless). Ameranth then appealed this decision to the U.S. Court of Appeals for the Federal Circuit. The Company believes this case lacks merit and that it has strong defenses to all of the infringement claims. The Company intends to defend the suit vigorously. However, the Company is unable to predict the likelihood of success of Ameranth’s infringement claims and is unable to predict the likelihood of success of its counterclaims. The Company has not recorded an accrual related to this lawsuit as of March 31, 2019, as it does not believe a material loss is probable. It is a reasonable possibility that a loss may be incurred; however, the possible range of loss is not estimable given the status of the case and the uncertainty as to whether the claims at issue are with or without merit, will be settled out of court, or will be determined in the Company’s favor, whether the Company may be required to expend significant management time and financial resources on the defense of such claims, and whether the Company will be able to recover any losses under its insurance policies. In addition to the matter described above, from time to time, the Company is involved in various other legal proceedings arising from the normal course of business activities, including labor and employment claims, some of which relate to the alleged misclassification of independent contractors. In September 2015, a claim was brought in the United States District Court for the Northern District of California under the Private Attorneys General Act by an individual plaintiff on behalf of himself and seeking to represent other drivers and the State of California. The claim sought monetary penalties and injunctive relief for alleged violations of the California Labor Code based on the alleged misclassification of drivers as independent contractors. A decision was issued on February 8, 2018, and the court ruled in favor of the Company, finding that plaintiff was properly classified as an independent contractor. In March 2018, the plaintiff appealed this decision to the U.S. Court of Appeals for the Ninth Circuit. The Company does not believe any of the foregoing claims will have a material impact on its consolidated financial statements. However, there is no assurance that any claim will not be combined into a collective or class action. Indemnification In connection with the merger of Seamless North America, LLC, Seamless Holdings Corporation and Grubhub Holdings Inc. in August 2013, the Company agreed to indemnify Aramark Holdings Corporation for negative income tax consequences associated with the October 2012 spin-off of Seamless Holdings Corporation that were the result of certain actions taken by the Company through October 29, 2014, in certain instances subject to a $15.0 million limitation. Management is not aware of any actions that would impact the indemnification obligation. |
Debt |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt |
8. Debt The following table summarizes the carrying value of the Company’s debt as of March 31, 2019 and December 31, 2018:
On February 6, 2019, the Company entered into an amended and restated credit agreement (the “Credit Agreement”) which provides, among other things, for aggregate revolving loans up to $225 million and term loans in an aggregate principal amount of $325 million. In addition, the Company may incur up to $250 million of incremental revolving or term loans pursuant to the terms and conditions of the Credit Agreement. The credit facility under the Credit Agreement will be available to the Company until February 5, 2024. The Credit Agreement replaced the Company’s prior $350 million credit facility, which was due to expire on October 9, 2022. There have been no changes in the terms of the Credit Agreement as described in Part II, Item 8, Note 16, Subsequent Events, to the Company’s 2018 Form 10-K. During the three months ended March 31, 2019, the Company made principal payments of $2.0 million from cash on hand. As of March 31, 2019, outstanding borrowings under the Credit Agreement were $340.3 million. The fair value of the Company’s outstanding debt approximates its carrying value as of March 31, 2019 (see Note 13, Fair Value Measurement, for additional details). The Company was in compliance with the covenants of the Credit Agreement as of March 31, 2019. Additional capacity under the Credit Agreement may be used for general corporate purposes, including funding working capital and future acquisitions. As of March 31, 2019 and December 31, 2018, total unamortized debt issuance costs of $3.3 million and $1.9 million, respectively, were recorded as other assets and as a reduction of long-term debt on the condensed consolidated balance sheets in proportion to the borrowing capacities of the revolving and term loans. Interest expense includes interest on outstanding borrowings, amortization of debt issuance costs and commitment fees on the undrawn portion available under the credit facility. The Company recognized interest expense of $3.5 million and $1.6 million during the three months ended March 31, 2019 and 2018, respectively. |
Stock-Based Compensation |
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Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation |
9. Stock-Based Compensation The Company has granted non-qualified and incentive stock options, restricted stock units and restricted stock awards under its incentive plans. The Company recognizes compensation expense based on estimated grant date fair values for all stock-based awards issued to employees and directors, including stock options, restricted stock awards and restricted stock units. Stock-based Compensation Expense The total stock-based compensation expense related to all stock-based awards was $16.5 million and $10.2 million during the three months ended March 31, 2019 and 2018, respectively. As of March 31, 2019, $244.7 million of total unrecognized stock-based compensation expense is expected to be recognized over a weighted-average period of 3.2 years. Excess tax benefits reflect the total realized value of the Company’s tax deductions from individual stock option exercise transactions and the vesting of restricted stock units in excess of the deferred tax assets that were previously recorded. During the three months ended March 31, 2019 and 2018, the Company recognized excess tax benefits from stock-based compensation of $2.3 million and $8.2 million, respectively, within income tax benefit on the condensed consolidated statements of operations and within cash flows from operating activities on the condensed consolidated statements of cash flows. The Company capitalized stock-based compensation expense as website and software development costs of $3.2 million and $1.7 million during the three months ended March 31, 2019 and 2018, respectively. Stock Options The Company granted 301,873 and 332,723 stock options under the Grubhub Inc. 2015 Long-Term Incentive Plan during the three months ended March 31, 2019 and 2018, respectively. The fair value of each stock option award was estimated based on the assumptions below as of the grant date using the Black-Scholes-Merton option pricing model. Expected volatility is based on the historical and implied volatilities of the Company’s own common stock. The Company uses historical data to estimate option exercises and employee terminations within the valuation model. Separate groups of employees that have similar historical exercise behavior are considered separately for valuation purposes. The expected term calculation for option awards considers a combination of the Company’s historical and estimated future exercise behavior. The risk-free rate for the period within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The assumptions used to determine the fair value of the stock options granted during the three months ended March 31, 2019 and 2018 were as follows:
Stock option awards as of December 31, 2018 and March 31, 2019, and changes during the three months ended March 31, 2019, were as follows:
The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between the fair value of the common stock and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their in-the-money options on each date. This amount will change in future periods based on the fair value of the Company’s stock and the number of options outstanding. The aggregate intrinsic value of awards exercised during the three months ended March 31, 2019 and 2018 was $6.1 million and $14.6 million, respectively. The Company recorded compensation expense for stock options of $4.0 million and $2.4 million for the three months ended March 31, 2019 and 2018, respectively. As of March 31, 2019, total unrecognized compensation cost, adjusted for estimated forfeitures, related to non-vested stock options was $38.5 million and is expected to be recognized over a weighted-average period of 2.7 years. Restricted Stock Units Non-vested restricted stock units as of December 31, 2018 and March 31, 2019, and changes during the three months ended March 31, 2019 were as follows:
Compensation expense related to restricted stock units was $12.5 million and $7.8 million during the three months ended March 31, 2019 and 2018, respectively. The aggregate fair value as of the vest date of restricted stock units that vested during the three months ended March 31, 2019 and 2018 was $26.9 million and $30.3 million, respectively. As of March 31, 2019, $206.2 million of total unrecognized compensation cost, adjusted for estimated forfeitures, related to 3,052,839 non-vested restricted stock units expected to vest with weighted-average grant date fair values of $72.06 is expected to be recognized over a weighted-average period of 3.2 years. The fair value of these awards was determined based on the Company’s stock price at the grant date and assumes no expected dividend payments through the vesting period. |
Income Taxes |
3 Months Ended |
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Mar. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes |
10. Income Taxes The Company’s effective tax rate was negative 14.3% and negative 0.8% during the three months ended March 31, 2019 and 2018, respectively. The income tax benefit for the three months ended March 31, 2019 and 2018, included the net impact of excess tax benefits for stock-based compensation of $2.3 million and $8.2 million, respectively (see Note 9, Stock-based Compensation, for additional details).
The Company is currently under examination for Tapingo’s federal income tax return for the tax year ended December 31, 2016. The Company does not believe, but cannot predict with certainty, that there will be any additional tax liabilities, penalties or interest as a result of the audit. |
Stockholders' Equity |
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Mar. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity |
11. Stockholders’ Equity As of March 31, 2019 and December 31, 2018, the Company was authorized to issue two classes of stock: common stock and preferred stock. Common Stock Each holder of common stock has one vote per share of common stock held on all matters that are submitted for stockholder vote. At March 31, 2019 and December 31, 2018, there were 500,000,000 shares of common stock authorized. At March 31, 2019 and December 31, 2018, there were 91,074,285 and 90,756,548 shares issued and outstanding, respectively. The Company did not hold any shares as treasury shares as of March 31, 2019 or December 31, 2018. On April 25, 2018, the Company issued and sold 2,820,464 shares of the Company’s common stock to Yum Restaurant Services Group, LLC (the “Investor”), a wholly owned subsidiary of Yum! Brands, Inc., for an aggregate purchase price of $200 million pursuant to an investment agreement dated February 7, 2018, by and between the Company and the Investor. The Company has used and expects to use the proceeds for general corporate purposes.
On January 22, 2016, the Company’s Board of Directors approved a program that authorizes the repurchase of up to $100 million of the Company’s common stock exclusive of any fees, commissions or other expenses relating to such repurchases through open market purchases or privately negotiated transactions at the prevailing market price at the time of purchase. The repurchase program was announced on January 25, 2016. Repurchased stock may be retired or held as treasury shares. The repurchase authorizations do not obligate the Company to acquire any particular amount of common stock or adopt any particular method of repurchase and may be modified, suspended or terminated at any time at management’s discretion. Repurchased and retired shares will result in an immediate reduction of the outstanding shares used to calculate the weighted-average common shares outstanding for basic and diluted net income per share at the time of the transaction. During the three months ended March 31, 2019, the Company did not repurchase any shares of its common stock. Preferred Stock The Company was authorized to issue 25,000,000 shares of preferred stock. There were no issued or outstanding shares of preferred stock as of March 31, 2019 or December 31, 2018. |
Earnings Per Share Attributable to Common Stockholders |
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Earnings Per Share Attributable to Common Stockholders |
12. Earnings Per Share Attributable to Common Stockholders Basic earnings per share is computed by dividing net income attributable to common stockholders by the weighted-average number of common shares outstanding during the period without consideration for common stock equivalents. Diluted net income per share attributable to common stockholders is computed by dividing net income by the weighted-average number of common shares outstanding during the period and potentially dilutive common stock equivalents, including stock options and restricted stock units, except in cases where the effect of the common stock equivalent would be antidilutive. Potential common stock equivalents consist of common stock issuable upon exercise of stock options and vesting of restricted stock units using the treasury stock method. The following table presents the calculation of basic and diluted net income per share attributable to common stockholders for the three months ended March 31, 2019 and 2018:
The number of shares of common stock underlying stock-based awards excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been antidilutive for the three months ended March 31, 2019 and 2018 were as follows:
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Fair Value Measurement |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurement |
13. Fair Value Measurement Certain assets and liabilities are required to be recorded at fair value on a recurring basis. Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The standards also establish a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The accounting guidance for fair value measurements prioritizes valuation methodologies based on the reliability of the inputs in the following three-tier value hierarchy:
The Company applied the following methods and assumptions in estimating its fair value measurements. The Company’s commercial paper, investments in corporate bonds and certain money market funds are classified as Level 2 within the fair value hierarchy because they are valued using inputs other than quoted prices in active markets that are observable directly or indirectly. The Company’s long-term debt is classified as Level 3 within the fair value hierarchy because it is valued using an income approach, which utilizes a discounted cash flow technique that considers the credit profile of the Company. Accounts receivable, restaurant food liability and accounts payable approximate fair value due to their generally short-term maturities. The following table presents the fair value, for disclosure purposes only, and carrying value of the Company’s assets and liabilities that are recorded at other than fair value as of March 31, 2019 and December 31, 2018:
The Company is required to record certain assets and liabilities at fair value on a nonrecurring basis, generally as a result of acquisitions. See Note 3, Acquisitions, for further discussion of the fair value of assets and liabilities associated with acquisitions. |
Significant Accounting Policies (Policies) |
3 Months Ended |
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Mar. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principles of Consolidation |
Basis of Presentation and Principles of Consolidation The accompanying unaudited condensed consolidated interim financial statements include the accounts of Grubhub Inc. and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and in accordance with the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited condensed consolidated interim financial statements include all wholly-owned subsidiaries and reflect all normal and recurring adjustments, as well as any other than normal adjustments, that are, in the opinion of management, necessary for a fair presentation of the results for the interim periods and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 filed with the SEC on February 28, 2019 (the “2018 Form 10-K”). All significant intercompany transactions have been eliminated in consolidation. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2019. |
Use of Estimates |
Use of Estimates The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Significant items subject to such estimates, judgments and assumptions include revenue recognition, website and internal-use software development costs, goodwill, recoverability of intangible assets with finite lives and other long-lived assets, stock-based compensation, and income taxes. Actual results could differ from these estimates. |
Changes in Accounting Principle |
Changes in Accounting Principle See “Recently Issued Accounting Pronouncements” below for a description of accounting principle changes adopted during the three months ended March 31, 2019 related to leases. There have been no other material changes to the Company’s significant accounting policies described in the 2018 Form 10-K. |
Recently Issued Accounting Pronouncements |
Recently Issued Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 introduces a new forward-looking approach, based on expected losses, to estimate credit losses on certain types of financial instruments, including trade receivables and held-to-maturity debt securities, which will require entities to incorporate considerations of historical information, current information and reasonable and supportable forecasts. This ASU also expands disclosure requirements. ASU 2016-13 is effective for the Company beginning in the first quarter of 2020 and early adoption is permitted. The guidance will be applied using the modified-retrospective approach. The adoption of ASU 2016-13 is not expected to have a material impact on the Company’s consolidated financial position, results of operations or cash flows. In February 2016, and in subsequent updates, the FASB issued Accounting Standards Codification Topic 842, Leases (“ASC Topic 842”). Under ASC Topic 842, a lessee recognizes a liability to make lease payments and a right-of-use asset for all leases (with the exception of short-term leases) in the statement of financial position at the commencement date. ASC Topic 842 was effective for and adopted by the Company in the first quarter of 2019. The Company adopted ASC Topic 842 using the modified retrospective transition method applied to all existing leases beginning January 1, 2019. Periods prior to adoption were not adjusted and continue to be reported in accordance with historic accounting guidance under ASC Topic 840. The Company elected the optional practical expedient package which, among other things, includes retaining the historical classification of leases. The adoption of ASC Topic 842 resulted in the recognition on the condensed consolidated balance sheets as of January 1, 2019 of right-of-use assets of $81.2 million and lease liabilities for operating leases of $97.7 million, but did not result in a cumulative-effect adjustment on retained earnings. The operating lease right-of-use asset includes the impact upon adoption of ASC Topic 842 of the derecognition of lease incentives, deferred rent, below-market lease intangibles, cease-use liabilities and prepaid rent balances recognized in prepaid expenses and other current assets and current and noncurrent other accruals on the consolidated balance sheets as of December 31, 2018. The adoption of ASC Topic 842 did not have and is not expected to have a material impact to the Company's consolidated results of operations or cash flows. See Note 7, Commitments and Contingencies, for additional details. |
Leases |
The Company determines if an arrangement is a lease at inception of a contract. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Non-lease components associated with lease components in the Company’s lease contracts are treated as a single lease component. As of March 31, 2019, the Company recognized on its condensed consolidated balance sheets operating lease right-of-use assets of $78.7 million that represent the Company's right to use an underlying asset during the lease term and current and noncurrent operating lease liabilities of $13.4 million and $82.4 million, respectively, that represent the Company's obligation to make lease payments. Operating lease right-of-use assets and liabilities commencing after January 1, 2019 are recognized at commencement date based on the present value of lease payments over the lease term. Because the rate implicit in each lease is not readily determinable, the Company uses its incremental borrowing rate to determine the present value of the lease payments. To determine the incremental borrowing rate, the Company uses information including the risk-free interest rate for the remaining lease term, the Company’s implied credit rating and interest rates of similar debt instruments of entities with comparable credit ratings. The Company recognizes rent expense on a straight-line basis over the lease term, which is allocated on a headcount basis to operations and support, sales and marketing, technology and general and administrative costs and expenses in the condensed consolidated statements of operations. |
Acquisitions (Tables) - Tapingo and LevelUp |
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Acquisition [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Acquisition Date Fair Value of Assets and Liabilities |
The following table summarizes the preliminary purchase price allocation acquisition-date fair values of the asset and liabilities acquired in connection with the Tapingo and LevelUp acquisitions:
|
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Valuation Methods for Intangible Assets Acquired |
The estimated fair values of the intangible assets acquired were determined based on a combination of the income, cost, and market approaches to measure the fair value of the restaurant relationships, diner acquisition and developed technology as follows:
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Pro Forma Summary of Operation |
The following unaudited pro forma information presents a summary of the operating results of the Company for the three months ended March 31, 2018 as if the acquisitions of Tapingo and LevelUp had occurred as of January 1 of the year prior to acquisition:
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Pro Forma Adjustments |
The pro forma adjustments that reflect the amortization that would have been recognized for intangible assets, elimination of transaction costs incurred, stock-based compensation expense for assumed equity awards and interest expense for transaction financings, as well as the pro forma tax impact of such adjustments for the three months ended March 31, 2018 were as follows:
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Marketable Securities (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments Debt And Equity Securities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Held-to-Maturity Marketable Securities |
The amortized cost, unrealized gains and losses and estimated fair value of the Company’s held-to-maturity marketable securities as of March 31, 2019 and December 31, 2018 were as follows:
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Summary of Continuous Unrealized Loss on Marketable Securities |
The gross unrealized losses, estimated fair value and length of time the individual marketable securities were in a continuous loss position for those marketable securities in an unrealized loss position as of March 31, 2019 and December 31, 2018 were as follows:
|
Goodwill and Acquired Intangible Assets (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Acquired Intangible Assets (Finite Lived) |
The components of acquired intangible assets as of March 31, 2019 and December 31, 2018 were as follows:
|
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Components of Acquired Intangible Assets (Infinite Lived) |
The components of acquired intangible assets as of March 31, 2019 and December 31, 2018 were as follows:
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Changes in Carrying Amount of Goodwill |
The change in the carrying amount of goodwill during the three months ended March 31, 2019 related to changes in the fair value of net deferred tax assets for the purchase price allocations of the Tapingo and LevelUp acquisitions during the measurement period were as follows:
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Estimated Future Amortization of Acquired Intangible Assets |
Estimated future amortization expense of acquired intangible assets as of March 31, 2019 was as follows:
|
Property and Equipment (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property Plant And Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Property and Equipment |
The components of the Company’s property and equipment as of March 31, 2019 and December 31, 2018 were as follows:
|
Commitments and Contingencies (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments And Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Lease Costs |
The components of lease costs, which consists of rent expense for leased office space, during the three months ended March 31, 2019 were as follows:
|
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Supplemental Cash Flow Information Related to Operating Leases Average Lease Terms and Discount Rates |
Supplemental cash flow information related to the Company’s operating leases as well as the weighted-average lease term and discount rate as of March 31, 2019, were as follows:
|
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Summary of Future Minimum Operating Lease Payments |
Future minimum lease payments under the Company’s operating lease agreements as of March 31, 2019 were as follows:
|
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Summary of Future Minimum Payments under Non cancelable Operating Lease |
As previously reported in the 2018 Form 10-K under ASC Topic 840, future minimum lease payments under the Company’s operating lease agreements that had initial or remaining non-cancelable lease terms in excess of one year as of December 31, 2018 were as follows:
|
Debt (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt |
The following table summarizes the carrying value of the Company’s debt as of March 31, 2019 and December 31, 2018:
|
Stock-Based Compensation (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assumptions Used to Determine Fair Value of Stock Options Granted | The assumptions used to determine the fair value of the stock options granted during the three months ended March 31, 2019 and 2018 were as follows:
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Summary of Stock Option Activity |
Stock option awards as of December 31, 2018 and March 31, 2019, and changes during the three months ended March 31, 2019, were as follows:
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Non-vested Restricted Stock Units |
Non-vested restricted stock units as of December 31, 2018 and March 31, 2019, and changes during the three months ended March 31, 2019 were as follows:
|
Earnings Per Share Attributable to Common Stockholders (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Computation of Basic and Diluted Net Income Per Share |
The following table presents the calculation of basic and diluted net income per share attributable to common stockholders for the three months ended March 31, 2019 and 2018:
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Anti-dilutive Securities Excluded from Calculation of Diluted Net Income Per Share |
The number of shares of common stock underlying stock-based awards excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been antidilutive for the three months ended March 31, 2019 and 2018 were as follows:
|
Fair Value Measurement (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Mar. 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value and Carrying Value of Assets and Liabilities Recorded at Other Than Fair Value |
The following table presents the fair value, for disclosure purposes only, and carrying value of the Company’s assets and liabilities that are recorded at other than fair value as of March 31, 2019 and December 31, 2018:
|
Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Jan. 01, 2019 |
---|---|---|
Accounting Policies [Abstract] | ||
Operating leases, right of use assets | $ 78,674 | $ 81,200 |
Operating leases, liabilities | $ 95,841 | $ 97,700 |
Acquisitions - Valuation Methods for Intangible Assets Acquired (Detail) |
3 Months Ended |
---|---|
Mar. 31, 2019 | |
Restaurant relationships | Tapingo | |
Business Acquisition [Line Items] | |
Valuation Method | Multi-period excess earnings |
Restaurant relationships | LevelUp | |
Business Acquisition [Line Items] | |
Valuation Method | With or without comparative business valuation |
Diner acquisition | Tapingo | |
Business Acquisition [Line Items] | |
Valuation Method | n/a |
Diner acquisition | LevelUp | |
Business Acquisition [Line Items] | |
Valuation Method | Cost to recreate |
Developed technology | Tapingo | |
Business Acquisition [Line Items] | |
Valuation Method | Cost to recreate |
Developed technology | LevelUp | |
Business Acquisition [Line Items] | |
Valuation Method | Multi-period excess earnings |
Pro forma Summary of Operation (Detail) - Tapingo and LevelUp $ / shares in Units, $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2018
USD ($)
$ / shares
| |
Business Acquisition [Line Items] | |
Revenues | $ | $ 243,347 |
Net income | $ | $ 21,621 |
Net income per share attributable to common shareholders: | |
Basic | $ / shares | $ 0.25 |
Diluted | $ / shares | $ 0.24 |
Pro Forma Adjustments for Additional Amortization of That Would Have Been Recognized on the Intangible Assets (Detail) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Business Acquisition Pro Forma Information Nonrecurring Adjustment [Line Items] | ||
Interest expense | $ 3,500 | $ 1,600 |
Income tax (benefit) expense | $ (862) | (236) |
Tapingo and LevelUp | Pro Forma | ||
Business Acquisition Pro Forma Information Nonrecurring Adjustment [Line Items] | ||
Depreciation and amortization | 1,626 | |
Transaction costs | (1,232) | |
Stock-based compensation | 1,872 | |
Interest expense | 525 | |
Income tax (benefit) expense | $ (826) |
Summary of Held-to-Maturity Marketable Securities (Detail) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Schedule Of Held To Maturity Securities [Line Items] | ||
Amortized Cost | $ 27,155 | $ 27,051 |
Unrealized Losses | (98) | (109) |
Estimated Fair Value | 27,057 | 26,942 |
Commercial Paper | Cash and Cash Equivalents | ||
Schedule Of Held To Maturity Securities [Line Items] | ||
Amortized Cost | 11,451 | 12,097 |
Unrealized Losses | (20) | (21) |
Estimated Fair Value | 11,431 | 12,076 |
Commercial Paper | Short Term Investments | ||
Schedule Of Held To Maturity Securities [Line Items] | ||
Amortized Cost | 14,704 | 13,334 |
Unrealized Losses | (78) | (88) |
Estimated Fair Value | 14,626 | 13,246 |
Corporate Bonds | Cash and Cash Equivalents | ||
Schedule Of Held To Maturity Securities [Line Items] | ||
Amortized Cost | 1,000 | 870 |
Estimated Fair Value | $ 1,000 | 870 |
Corporate Bonds | Short Term Investments | ||
Schedule Of Held To Maturity Securities [Line Items] | ||
Amortized Cost | 750 | |
Estimated Fair Value | $ 750 |
Marketable Securities - Additional Information (Detail) - USD ($) |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Schedule Of Held To Maturity Securities [Line Items] | ||
Other-than-temporary impairment losses related to marketable securities | $ 0 | $ 0 |
Net Interest (Income) Expense | ||
Schedule Of Held To Maturity Securities [Line Items] | ||
Interest income | $ 700,000 | $ 600,000 |
Goodwill and Acquired Intangible Assets - Additional Information (Detail) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Intangible assets amortization expense | $ 11,900 | $ 11,500 |
Schedule of Carrying Amount of Goodwill (Detail) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill, Begining Balance | $ 1,019,239 |
Goodwill, Acquisition | (13,858) |
Goodwill, Ending Balance | 1,005,381 |
Net Book Value, Beginning Balance | 1,019,239 |
Net Book Value, Acquisition | (13,858) |
Net Book Value, Ending Balance | $ 1,005,381 |
Estimated Future Amortization of Acquired Intangible Assets (Detail) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Goodwill And Intangible Assets Disclosure [Abstract] | ||
The remainder of 2019 | $ 35,105 | |
2020 | 44,381 | |
2021 | 38,745 | |
2022 | 36,776 | |
2023 | 30,281 | |
Thereafter | 260,025 | |
Amortizable intangible assets, Net Carrying Value | $ 445,313 | $ 459,337 |
Components of Property and Equipment (Detail) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Property Plant And Equipment [Line Items] | ||
Property and equipment | $ 227,804 | $ 198,092 |
Accumulated depreciation and amortization | (91,457) | (78,597) |
Property and equipment, net | 136,347 | 119,495 |
Developed software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment | 104,818 | 90,302 |
Computer equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment | 55,838 | 50,767 |
Leasehold improvements | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment | 41,827 | 39,550 |
Furniture and fixtures | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment | 12,408 | 10,801 |
Purchased Software and Digital Assets | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment | 6,467 | 4,696 |
Construction in progress | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment | $ 6,446 | $ 1,976 |
Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Property Plant And Equipment [Line Items] | ||
Depreciation and amortization | $ 25,089 | $ 20,951 |
Capitalized developed software costs | 14,500 | 8,200 |
Property And Equipment Excluding Developed Software | ||
Property Plant And Equipment [Line Items] | ||
Depreciation and amortization | 6,200 | 5,100 |
Developed software | ||
Property Plant And Equipment [Line Items] | ||
Depreciation and amortization | $ 7,000 | $ 4,400 |
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Jan. 01, 2019 |
|
Commitments And Contingencies Disclosure [Abstract] | ||
Description of operating lease agreements | As of March 31, 2019, the Company had operating lease agreements for its office facilities in various locations throughout the U.S, as well as in the U.K. and Israel, which expire at various dates through September 2029. | |
Lease renewal period | 5 years | |
Lessee, operating lease, existence of option to extend [true false] | true | |
Lessee, operating lease, existence of option to terminate [true false] | true | |
Operating lease right-of-use assets | $ 78,674 | $ 81,200 |
Operating lease liabilities current | 13,436 | |
Operating lease liabilities non current | 82,405 | |
Future obligations for office facilities not yet commenced | $ 27,000 | |
Operating lease term not yet commenced | 11 years |
Components of Lease Costs (Detail) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Lessee Operating Lease Description [Abstract] | |
Fixed operating lease cost | $ 3,808 |
Short-term lease cost | 450 |
Sublease income | (47) |
Total lease cost | $ 4,211 |
Supplemental Cash Flow Information Related to Operating Leases Average Lease Terms and Discount Rates (Detail) $ in Thousands |
3 Months Ended |
---|---|
Mar. 31, 2019
USD ($)
| |
Lessee Operating Lease Description [Abstract] | |
Cash paid for operating lease liabilities (in thousands) | $ 3,169 |
Weighted-average remaining lease term (years) | 8 years 10 months 24 days |
Weighted-average discount rate | 5.20% |
Summary of Future Minimum Operating Lease Payments (Detail) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Jan. 01, 2019 |
---|---|---|
Lessee Operating Lease Description [Abstract] | ||
The remainder of 2019 | $ 10,459 | |
2020 | 14,878 | |
2021 | 14,244 | |
2022 | 12,218 | |
2023 | 12,218 | |
Thereafter | 57,572 | |
Total future lease payments | 121,589 | |
Less interest | (25,748) | |
Present value of lease liabilities | $ 95,841 | $ 97,700 |
Summary of Future Minimum Payments under Non cancelable Operating Lease (Detail) $ in Thousands |
Dec. 31, 2018
USD ($)
|
---|---|
Leases [Abstract] | |
2019 | $ 13,009 |
2020 | 14,874 |
2021 | 14,243 |
2022 | 12,219 |
2023 | 12,220 |
Thereafter | 57,503 |
Total | $ 124,068 |
Commitments and Contingencies - Additional Information (Detail1) $ in Millions |
Mar. 31, 2019
USD ($)
|
---|---|
Maximum | Merger Income Tax Consequences | |
Loss Contingencies [Line Items] | |
Indemnification related to business combination | $ 15.0 |
Schedule of Debt (Detail) - USD ($) $ in Thousands |
Mar. 31, 2019 |
Dec. 31, 2018 |
---|---|---|
Debt Instrument [Line Items] | ||
Total debt | $ 340,281 | $ 342,312 |
Less current portion | (10,156) | (6,250) |
Less unamortized deferred debt issuance costs | (1,932) | (514) |
Long-term debt | 328,193 | 335,548 |
Term loan | ||
Debt Instrument [Line Items] | ||
Total debt | 322,968 | 120,312 |
Revolving loan | ||
Debt Instrument [Line Items] | ||
Total debt | $ 17,313 | $ 222,000 |
Debt - Additional Information (Detail) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Feb. 06, 2019 |
Mar. 31, 2019 |
Mar. 31, 2018 |
Dec. 31, 2018 |
|
Debt Instrument [Line Items] | ||||
Repayment of borrowings | $ 2,031,000 | $ 25,781,000 | ||
Long-term debt | 340,281,000 | $ 342,312,000 | ||
Unamortized Debt Issuance Expense | 3,300,000 | 1,900,000 | ||
Interest expense | 3,500,000 | $ 1,600,000 | ||
Revolving Loans | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | $ 17,313,000 | $ 222,000,000 | ||
Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Credit facility, additional borrowing capacity | $ 250,000,000 | |||
Credit facility, expiration date | Feb. 05, 2024 | |||
Credit Agreement | Revolving Loans | ||||
Debt Instrument [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 225,000,000 | |||
Credit Agreement | Term Loans | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | 325,000,000 | |||
Prior Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Credit facility, maximum borrowing capacity | $ 350,000,000 | |||
Credit facility, expiration date | Oct. 09, 2022 |
Assumptions Used to Determine Fair Value of Stock Options Granted (Detail) - $ / shares |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Weighted-average fair value options granted | $ 31.27 | $ 33.24 |
Average risk-free interest rate | 2.44% | 2.38% |
Expected stock price volatility | 48.10% | 45.70% |
Dividend yield | 0.00% | 0.00% |
Expected stock option life (years) | 4 years | 4 years |
Non-vested Restricted Stock Units (Detail) - Restricted Stock Units |
3 Months Ended |
---|---|
Mar. 31, 2019
$ / shares
shares
| |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares, Beginning Balance | shares | 2,328,857 |
Shares, Granted | shares | 1,323,526 |
Shares, Forfeited | shares | (175,710) |
Shares, Vested | shares | (336,290) |
Shares, Cancelled | shares | (52,357) |
Shares, Ending Balance | shares | 3,088,026 |
Weighted-Average Grant Date Fair Value, Beginning Balance | $ / shares | $ 67.33 |
Weighted-Average Grant Date Fair Value, Granted | $ / shares | 77.95 |
Weighted-Average Grant Date Fair Value, Forfeited | $ / shares | 68.60 |
Weighted-Average Grant Date Fair Value, Vested | $ / shares | 63.84 |
Weighted-Average Grant Date Fair Value, Cancelled | $ / shares | 85.39 |
Weighted-Average Grant Date Fair Value, Ending Balance | $ / shares | $ 72.17 |
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Income Tax Disclosure [Abstract] | ||
Effective income tax rate | (14.30%) | (0.80%) |
Excess tax benefits from stock-based compensation | $ 2.3 | $ 8.2 |
Income tax examination description | The Company is currently under examination for Tapingo’s federal income tax return for the tax year ended December 31, 2016. The Company does not believe, but cannot predict with certainty, that there will be any additional tax liabilities, penalties or interest as a result of the audit. |
Stockholders' Equity - Additional Information (Detail) - USD ($) |
3 Months Ended | |||
---|---|---|---|---|
Apr. 25, 2018 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Jan. 22, 2016 |
|
Class Of Stock [Line Items] | ||||
Number of votes per share | one vote per share | |||
Common stock, shares authorized | 500,000,000 | 500,000,000 | ||
Common stock, shares issued | 91,074,285 | 90,756,548 | ||
Common stock, shares outstanding | 91,074,285 | 90,756,548 | ||
Treasury stock, shares | 0 | 0 | ||
Preferred Stock, shares authorized | 25,000,000 | 25,000,000 | ||
Preferred Stock, shares issued | 0 | 0 | ||
Preferred Stock, shares outstanding | 0 | 0 | ||
Common stock | Stock Repurchase Program | ||||
Class Of Stock [Line Items] | ||||
Stock repurchase program, announced date | Jan. 25, 2016 | |||
Common stock repurchased, Shares | 0 | |||
Common stock | Maximum | Stock Repurchase Program | ||||
Class Of Stock [Line Items] | ||||
Authorized to repurchase of common stock | $ 100,000,000 | |||
Investment Agreement | Common stock | Accredited Investor | ||||
Class Of Stock [Line Items] | ||||
Stock Issued and sold | 2,820,464 | |||
Aggregate purchase price | $ 200,000,000 |
Computation of Basic and Diluted Net Income Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Basic earnings per share: | ||
Net income attributable to common stockholders (numerator) | $ 6,890 | $ 30,766 |
Shares used in computation (denominator) | ||
Weighted-average common shares outstanding | 90,951 | 87,085 |
Basic earnings per share | $ 0.08 | $ 0.35 |
Diluted earnings per share: | ||
Net income attributable to common stockholders (numerator) | $ 6,890 | $ 30,766 |
Shares used in computation (denominator) | ||
Weighted-average common shares outstanding | 90,951 | 87,085 |
Effect of dilutive securities: | ||
Weighted-average diluted shares | 92,918 | 90,091 |
Diluted earnings per share | $ 0.07 | $ 0.34 |
Stock Options | ||
Effect of dilutive securities: | ||
Stock options, Restricted stock units, shares | 1,308 | 1,621 |
Restricted Stock Units | ||
Effect of dilutive securities: | ||
Stock options, Restricted stock units, shares | 659 | 1,385 |
Anti-dilutive Securities Excluded from Calculation of Diluted Net Income Per Share (Detail) - shares shares in Thousands |
3 Months Ended | |
---|---|---|
Mar. 31, 2019 |
Mar. 31, 2018 |
|
Stock Options | ||
Anti-dilutive shares underlying stock-based awards: | ||
Anti-dilutive shares underlying stock-based awards | 845 | 333 |
Restricted Stock Units | ||
Anti-dilutive shares underlying stock-based awards: | ||
Anti-dilutive shares underlying stock-based awards | 572 | 60 |