Document and Entity Information - USD ($) $ / shares in Units, $ in Millions |
12 Months Ended | |
|---|---|---|
Dec. 31, 2024 |
Mar. 06, 2025 |
|
| Document Information [Line Items] | ||
| Document Type | 10-K | |
| Amendment Flag | false | |
| Document Period End Date | Dec. 31, 2024 | |
| Document Fiscal Year Focus | 2024 | |
| Document Fiscal Period Focus | FY | |
| Current Fiscal Year End Date | --12-31 | |
| Document Annual Report | true | |
| Document Transition Report | false | |
| Entity Registrant Name | Paymentus Holdings, Inc. | |
| Entity Central Index Key | 0001841156 | |
| Entity File Number | 001-40429 | |
| Entity Tax Identification Number | 45-3188251 | |
| Entity Incorporation, State or Country Code | DE | |
| Entity Address, Address Line One | 11605 N. Community House Road | |
| Entity Address, Address Line Two | Suite 300 | |
| Entity Address, City or Town | Charlotte | |
| Entity Address, State or Province | NC | |
| Entity Address, Postal Zip Code | 28277 | |
| City Area Code | 888 | |
| Local Phone Number | 440-4826 | |
| Title of 12(b) Security | Class A Common Stock, par value $0.0001 per share | |
| Trading Symbol | PAY | |
| Security Exchange Name | NYSE | |
| Entity Well-known Seasoned Issuer | No | |
| Entity Voluntary Filers | No | |
| Entity Current Reporting Status | Yes | |
| Entity Interactive Data Current | Yes | |
| Entity Filer Category | Accelerated Filer | |
| Entity Small Business | false | |
| Entity Emerging Growth Company | true | |
| Entity Ex Transition Period | false | |
| ICFR Auditor Attestation Flag | false | |
| Document Financial Statement Error Correction [Flag] | false | |
| Entity Shell Company | false | |
| Documents Incorporated by Reference | Portions of the Registrant’s Definitive Proxy Statement for the 2025 Annual Meeting of Stockholders, which is expected to be filed within 120 days after the Registrant's fiscal year ended December 31, 2024, are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein. |
|
| Share Price | $ 19 | |
| Entity Public Float | $ 354.0 | |
| Auditor Name | PricewaterhouseCoopers LLP | |
| Auditor Firm ID | 238 | |
| Auditor Location | Charlotte, North Carolina | |
| Auditor Opinion | Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Paymentus Holdings, Inc. and its subsidiaries (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive income (loss), of stockholders’ equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America. |
|
| Common Class A [Member] | ||
| Document Information [Line Items] | ||
| Entity Common Stock, Shares Outstanding | 32,317,256 | |
| Common Class B [Member] | ||
| Document Information [Line Items] | ||
| Entity Common Stock, Shares Outstanding | 92,651,414 |
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Allowance for accounts and other receivables | $ 257 | $ 435 |
| Class A Common Stock [Member] | ||
| Common stock, par value | $ 0.0001 | $ 0.0001 |
| Common stock, shares authorized | 883,950,000 | 883,950,000 |
| Common stock, shares issued | 32,136,989 | 20,758,603 |
| Common stock, shares outstanding | 32,136,989 | 20,758,603 |
| Class B Common Stock [Member] | ||
| Common stock, par value | $ 0.0001 | $ 0.0001 |
| Common stock, shares authorized | 111,050,000 | 111,050,000 |
| Common stock, shares issued | 92,699,294 | 103,062,508 |
| Common stock, shares outstanding | 92,699,294 | 103,062,508 |
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Income Statement [Abstract] | |||
| Revenue | $ 871,745 | $ 614,490 | $ 497,001 |
| Cost of revenue | 633,575 | 432,148 | 347,323 |
| Gross profit | 238,170 | 182,342 | 149,678 |
| Operating expenses | |||
| Research and development | 51,334 | 44,248 | 41,220 |
| Sales and marketing | 105,052 | 83,996 | 73,295 |
| General and administrative | 36,927 | 36,005 | 38,139 |
| Total operating expenses | 193,313 | 164,249 | 152,654 |
| Income (loss) from operations | 44,857 | 18,093 | (2,976) |
| Interest income, net | 8,742 | 7,019 | 1,663 |
| Other income | 345 | 12 | 5 |
| Income (loss) before income taxes | 53,944 | 25,124 | (1,308) |
| (Provision for) benefit from income taxes | (9,775) | (2,802) | 795 |
| Net income (loss) | $ 44,169 | $ 22,322 | $ (513) |
| Net income per share | |||
| Basic | $ 0.36 | $ 0.18 | $ 0 |
| Diluted | $ 0.35 | $ 0.18 | $ 0 |
| Weighted-average number of shares used to compute net income per share | |||
| Basic | 124,372,031 | 123,511,608 | 122,099,437 |
| Diluted | 127,714,622 | 125,071,829 | 122,099,437 |
| Comprehensive income (loss) | |||
| Net Income (Loss) | $ 44,169 | $ 22,322 | $ (513) |
| Foreign currency translation adjustments, net of tax | (320) | 109 | (190) |
| Comprehensive income (loss) | $ 43,849 | $ 22,431 | $ (703) |
Pay vs Performance Disclosure - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Pay vs Performance Disclosure | |||
| Net Income (Loss) | $ 44,169 | $ 22,322 | $ (513) |
Insider Trading Arrangements - shares |
3 Months Ended | |
|---|---|---|
Dec. 31, 2024 |
Dec. 05, 2024 |
|
| Trading Arrangements, by Individual | ||
| Material Terms of Trading Arrangement | Item 9B. Other Information Except as set forth below, during the quarter ended December 31, 2024, none of the Company’s directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as such terms are defined in Item 408(a) of Regulation S‑K. On November 7, 2024, Sanjay Kalra, the Company’s Chief Financial Officer, terminated a trading arrangement he had previously adopted with respect to the sale of shares of the Company’s Class A common stock that was intended to satisfy the affirmative defense conditions of Securities Exchange Act Rule 10b5-1(c) (a "Rule 10b5-1 Trading Plan"). Mr. Kalra’s Rule 10b5-1 Trading Plan was adopted on and provided for the sale of up to 50,000 shares of Class A common stock pursuant to the terms of the Rule 10b5-1 Trading Plan. As of the date of termination of the Rule 10b-5 Trading Plan, Mr. Kalra had sold no shares of Class A common stock under the terms of the Rule 10b5-1 Trading Plan. On December 6, 2024, Mr. Kalra adopted a new Rule 10b5-1 Trading Plan for the sale of the Company’s Class A common stock. Mr. Kalra’s Rule 10b5-1 Trading Plan, which , provides for the sale of up to 50,000 shares of Class A common stock pursuant to the terms of the Rule 10b5-1 Trading Plan. On December 5, 2024, Andrew Gerber, the Company’s General Counsel, terminated a Rule 10b5-1 Trading Plan. Mr. Gerber’s Rule 10b5-1 Trading Plan was adopted on and provided for the sale of up to 56,765 shares of Class A common stock pursuant to the terms of the Rule 10b5-1 Trading Plan. As of the date of termination of the Rule 10b-5 Trading Plan, Mr. Gerber had sold 34,272 shares of Class A common stock under the terms of the Rule 10b5-1 Trading Plan. |
|
| Rule 10b5-1 Arrangement Adopted | false | |
| Non-Rule 10b5-1 Arrangement Adopted | false | |
| Rule 10b5-1 Arrangement Terminated | false | |
| Non-Rule 10b5-1 Arrangement Terminated | false | |
| Arrangement One [Member] | Sanjay Kalra [Member] | ||
| Trading Arrangements, by Individual | ||
| Name | Sanjay Kalra | |
| Title | Chief Financial Officer | |
| Rule 10b5-1 Arrangement Adopted | true | |
| Adoption Date | June 13, 2024 | |
| Rule 10b5-1 Arrangement Terminated | true | |
| Termination Date | November 7, 2024 | |
| Expiration Date | June 14, 2025 | |
| Arrangement Duration | 366 days | |
| Aggregate Available | 50,000 | |
| Arrangement Two [Member] | Sanjay Kalra [Member] | ||
| Trading Arrangements, by Individual | ||
| Rule 10b5-1 Arrangement Adopted | true | |
| Adoption Date | December 6, 2024 | |
| Expiration Date | March 2, 2026 | |
| Arrangement Duration | 451 days | |
| Aggregate Available | 50,000 | |
| Arrangement Three [Member] | Andrew Gerber [Member] | ||
| Trading Arrangements, by Individual | ||
| Name | Andrew Gerber | |
| Title | General Counsel | |
| Rule 10b5-1 Arrangement Adopted | true | |
| Adoption Date | September 4, 2024 | |
| Rule 10b5-1 Arrangement Terminated | true | |
| Termination Date | December 5, 2024 | |
| Expiration Date | February 27, 2026 | |
| Arrangement Duration | 541 days | |
| Aggregate Available | 56,765 | 34,272 |
Cybersecurity Risk Management, Strategy, and Governance |
12 Months Ended |
|---|---|
Dec. 31, 2024 | |
| Cybersecurity Risk Management, Strategy, and Governance [Line Items] | |
| Cybersecurity Risk Management Processes for Assessing, Identifying, and Managing Threats [Text Block] | Item 1C. Cybersecurity Overview We recognize the importance of assessing, identifying and managing material risks associated with cybersecurity threats, as such term is defined in Item 106(a) of Regulation S-K. These risks include, among other things, operational disruption; intellectual property theft; fraud; extortion; harm to employees or customers; violation of privacy or security laws; other litigation and legal risk; customer attrition; and reputational risks. We have implemented several cybersecurity processes, technologies and controls to aid in our efforts to assess, identify and manage such material risks. Risk Management and Strategy Our cybersecurity risk assessment process helps identify our cybersecurity threat risks by assessing our cybersecurity program against industry and best practices standards set by the National Institute of Standards and Technology (“NIST”), the International Organization for Standardization (“ISO”) and the Center for Internet Security (“CIS”), as well as by annually engaging experts to attempt to infiltrate/test our information systems (as such term is defined in Item 106(a) of Regulation S-K). We have established a cybersecurity risk management process that includes internal reporting of significant cybersecurity risk to our senior leadership and executive team on a monthly basis. At the management level, we have established an information security risk committee, chaired by our Chief Information Security Officer (“CISO”) and comprised of employees and executive management, to, among other things, coordinate and communicate the direction, current state, security risks (gaps) and governance of our information security program. Our cybersecurity program focuses in particular on the following key areas: Collaboration To identify and assess material risks from cybersecurity threats, our Cybersecurity Governance, Risk and Compliance ("GRC") team considers cybersecurity threat risks alongside other company risks as part of our overall risk assessment process. Our enterprise risk professionals collaborate with subject matter experts, as necessary, to gather insights for identifying and assessing material cybersecurity threat risks, their severity and potential mitigations. Risk Assessment We employ a range of tools and services including (but not limited to) regular network and endpoint monitoring, vulnerability assessments and penetration testing to inform our professionals’ risk identification and assessment. Technical Safeguards We regularly assess and deploy internal and third party technical safeguards designed to protect our information systems from cybersecurity threats. Such safeguards are regularly evaluated and improved based on vulnerability assessments, cybersecurity threat intelligence and incident response experience. Incident Response and Recovery Planning We have established incident response and recovery plans and continue to regularly test and evaluate the effectiveness of those plans. Our incident response and recovery plans address and guide our employees, management and board of directors on our response to a cybersecurity incident. We also have relationships with third party experts that can be utilized in the case of an incident. Third-Party Risk Management Our cybersecurity risk processes address risks associated with our use of third-party service providers, including subcontractors used by those third-parties. Third-party risks are included within our GRC and procurement program, including the selection and oversight of our third-party service providers. Education and Awareness Our policies require each of our employees to contribute to our data security efforts. We regularly train employees of the importance of handling and protecting customer and employee data, including through annual privacy and security training to enhance employee awareness of how to detect and respond to cybersecurity threats. We also have annual specialized training of our development staff that focuses on secure development best practices. External Assessments We perform periodic internal and third-party assessments to test our cybersecurity controls and regularly evaluate our policies and procedures for handling and control of sensitive data and systems in an effort to identify areas for continued focus, improvement and/or compliance under various applicable regulatory frameworks (e.g., SOC, SOX, PCI, HIPAA). Cybersecurity Risk Governance and Oversight Board's Oversight Role Cybersecurity is an important part of our risk management processes and an area of continued focus for our board of directors, audit committee and management. Our board of directors is responsible for the oversight of the overall corporate approach to cybersecurity risks. The board of directors has delegated such enterprise and cybersecurity risk management to its audit committee. At least quarterly, the audit committee and/or board of directors receives an overview from management of our cybersecurity threat risk management and strategy, covering topics such as data security posture, results from third-party assessments, progress towards pre-determined risk-mitigation-related goals, our incident response plan and any material cybersecurity threat risks or incidents and developments, as well as the steps management has taken to respond to such risks. Members of the audit committee and the board of directors are also encouraged to engage in ad hoc conversations with management on cybersecurity-related news events and discuss any updates to our cybersecurity risk management programs. Under its charter, the audit committee is charged with discussing our major financial, information technology and cybersecurity risk exposures and the steps management has taken to monitor and control such exposures as well as the oversight of management’s plans to address such risks. One member of our audit committee and board of directors has a strong background in information technology and cybersecurity risk management through service in related senior executive positions of other publicly traded companies meets regularly with our CISO to discuss our cybersecurity risk management processes. Management’s Role Our cybersecurity program, which is discussed in greater detail under the “Risk Management and Strategy” heading above, is led by our CISO, who has over 20 years of prior work experience in various roles with large public companies involving managing information security, developing cybersecurity strategy, implementing effective information and cybersecurity programs. In addition, our CISO manages a team of highly trained and experienced cybersecurity professionals in support of the cybersecurity program. Disclosure Controls and Procedures In addition to the information security risk committee discussed above, we maintain a disclosure committee with certain responsibilities that include among other things, the discussion of cybersecurity matters for materiality, proper internal reporting systems and incident disclosure evaluation. The disclosure committee also has a cybersecurity subcommittee that meets at least quarterly to discuss ongoing internal and external cyber-events, as well as mapping out the response process in the event of a cybersecurity incident that may reasonably be viewed as potentially material, including assessing the incident, materiality and disclosure obligations. Cybersecurity Risks In 2024, we did not identify any cybersecurity threats that resulted in a material adverse effect on our business strategy, results of operations, or financial condition. Notwithstanding the discussion above and our efforts to address cybersecurity risks, we cannot guarantee that we can mitigate or eliminate all cyber-related risks, including those related to operational disruption; intellectual property theft; fraud; extortion; harm to employees or customers; violation of privacy or security laws and other litigation and legal risk; customer attrition; and reputational risks. We urge you to read our discussion regarding whether and how risks from identified cybersecurity threats could materially affect us as part of our risk factor disclosures at “Item 1A - Risk Factors“—Risks Related to Our Business and Industry” and “—Risks Related to Our Technology and Intellectual Property” of this Annual Report on Form 10-K, which disclosures are incorporated by reference herein. |
| Cybersecurity Risk Management Processes Integrated [Flag] | true |
| Cybersecurity Risk Management Processes Integrated [Text Block] | We have implemented several cybersecurity processes, technologies and controls to aid in our efforts to assess, identify and manage such material risks.Our cybersecurity risk assessment process helps identify our cybersecurity threat risks by assessing our cybersecurity program against industry and best practices standards set by the National Institute of Standards and Technology (“NIST”), the International Organization for Standardization (“ISO”) and the Center for Internet Security (“CIS”), |
| Cybersecurity Risk Management Third Party Engaged [Flag] | true |
| Cybersecurity Risk Third Party Oversight and Identification Processes [Flag] | true |
| Cybersecurity Risk Materially Affected or Reasonably Likely to Materially Affect Registrant [Flag] | false |
| Cybersecurity Risk Board of Directors Oversight [Text Block] | Cybersecurity Risk Governance and Oversight Board's Oversight Role Cybersecurity is an important part of our risk management processes and an area of continued focus for our board of directors, audit committee and management. Our board of directors is responsible for the oversight of the overall corporate approach to cybersecurity risks. The board of directors has delegated such enterprise and cybersecurity risk management to its audit committee. At least quarterly, the audit committee and/or board of directors receives an overview from management of our cybersecurity threat risk management and strategy, covering topics such as data security posture, results from third-party assessments, progress towards pre-determined risk-mitigation-related goals, our incident response plan and any material cybersecurity threat risks or incidents and developments, as well as the steps management has taken to respond to such risks. Members of the audit committee and the board of directors are also encouraged to engage in ad hoc conversations with management on cybersecurity-related news events and discuss any updates to our cybersecurity risk management programs. Under its charter, the audit committee is charged with discussing our major financial, information technology and cybersecurity risk exposures and the steps management has taken to monitor and control such exposures as well as the oversight of management’s plans to address such risks. One member of our audit committee and board of directors has a strong background in information technology and cybersecurity risk management through service in related senior executive positions of other publicly traded companies meets regularly with our CISO to discuss our cybersecurity risk management processes. Management’s Role |
| Cybersecurity Risk Board Committee or Subcommittee Responsible for Oversight [Text Block] | Our board of directors is responsible for the oversight of the overall corporate approach to cybersecurity risks. |
| Cybersecurity Risk Process for Informing Board Committee or Subcommittee Responsible for Oversight [Text Block] | The board of directors has delegated such enterprise and cybersecurity risk management to its audit committee. At least quarterly, the audit committee and/or board of directors receives an overview from management of our cybersecurity threat risk management and strategy, covering topics such as data security posture, results from third-party assessments, progress towards pre-determined risk-mitigation-related goals, our incident response plan and any material cybersecurity threat risks or incidents and developments, as well as the steps management has taken to respond to such risks. |
| Cybersecurity Risk Role of Management [Text Block] | Management’s Role Our cybersecurity program, which is discussed in greater detail under the “Risk Management and Strategy” heading above, is led by our CISO, who has over 20 years of prior work experience in various roles with large public companies involving managing information security, developing cybersecurity strategy, implementing effective information and cybersecurity programs. In addition, our CISO manages a team of highly trained and experienced cybersecurity professionals in support of the cybersecurity program. |
| Cybersecurity Risk Management Positions or Committees Responsible [Flag] | true |
| Cybersecurity Risk Management Positions or Committees Responsible [Text Block] | Under its charter, the audit committee is charged with discussing our major financial, information technology and cybersecurity risk exposures and the steps management has taken to monitor and control such exposures as well as the oversight of management’s plans to address such risks. |
| Cybersecurity Risk Management Expertise of Management Responsible [Text Block] | Our cybersecurity program, which is discussed in greater detail under the “Risk Management and Strategy” heading above, is led by our CISO, who has over 20 years of prior work experience in various roles with large public companies involving managing information security, developing cybersecurity strategy, implementing effective information and cybersecurity programs. In addition, our CISO manages a team of highly trained and experienced cybersecurity professionals in support of the cybersecurity program. |
| Cybersecurity Risk Process for Informing Management or Committees Responsible [Text Block] | To identify and assess material risks from cybersecurity threats, our Cybersecurity Governance, Risk and Compliance ("GRC") team considers cybersecurity threat risks alongside other company risks as part of our overall risk assessment process. Our enterprise risk professionals collaborate with subject matter experts, as necessary, to gather insights for identifying and assessing material cybersecurity threat risks, their severity and potential mitigations. |
Organization and Description of Business |
12 Months Ended |
|---|---|
Dec. 31, 2024 | |
| Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
| Organization and Description of Business | 1. Organization and Description of Business Description of Business Paymentus Holdings, Inc. and its wholly owned subsidiaries ("Paymentus" or "the Company") provides electronic bill presentment and payment services, enterprise customer communication and self-service revenue management to billers through a Software-as-a-Service, ("SaaS"), secure, omni-channel technology platform. The platform seamlessly integrates into a biller’s core financial and operating systems to provide flexible and secure access to payment processing of credit cards, debit cards, eChecks and digital wallets across a significant number of channels including online, mobile, IVR, call center, chatbot and voice-based assistants. Paymentus was incorporated in the state of Delaware on September 2, 2011 with primary office locations in Charlotte, North Carolina, Dallas, Texas, Santa Clara, California, Richmond Hill, Ontario (Canada), and Gurugram, Mohali and Bangalore (India). The Company is headquartered in Charlotte, North Carolina. |
Basis of Presentation and Summary of Significant Accounting Policies |
12 Months Ended |
|---|---|
Dec. 31, 2024 | |
| Accounting Policies [Abstract] | |
| Basis of Presentation and Summary of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and balances have been eliminated upon consolidation. Segment Information Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker ("CODM") in deciding how to make operating decisions, allocate resources and assess performance. The Company has three operating segments based on geography. The United States segment represents the vast majority of the Company’s consolidated net sales and gross profit. The additional two operating segments, Canada and India, do not meet the quantitative thresholds for separate reporting, either individually or in the aggregate. None of the operating segments qualified for aggregation. The Company’s CODM is its chief executive officer. The CODM reviews financial information presented on a consolidated basis for purposes of making operating decision and allocating resources but evaluates the performance of the Company’s operating segments based on revenue and gross profit. The Company does not analyze discrete segment balance sheet information related to long-term assets as the business is managed on a consolidated basis. All other financial information is presented on a consolidated basis. See Note 11 for additional information. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Such estimates include revenue recognition, cost of revenue recognition, the allowance for credit losses, the lives of tangible and intangible assets, the valuation of acquired intangible assets and the recoverability or impairment of intangible assets, including goodwill, internal-use software development costs, valuation of stock warrants issued, stock-based compensation, and accounting for income taxes. The Company bases its estimates on historical experience and also on assumptions that management considers reasonable. The Company assesses these estimates on a regular basis; however, actual results could differ from these estimates. Foreign Currency The reporting currency of the Company is the United States Dollar. The Company’s foreign subsidiaries use the local currency of their respective countries as their functional currency. Assets and liabilities are translated using the exchange rates at the balance sheet date. Revenue and expenses are translated at average exchange rates during the period. Equity transactions are translated using historical exchange rates. The effects of foreign currency translation adjustments are recorded in accumulated other comprehensive income (loss) or ("AOCI") as a component of stockholders' equity, and related periodic movements are summarized as a line item in the consolidated statements of operations and comprehensive income (loss). Gains and losses from the remeasurement of foreign currency transactions into the functional currency are recognized as foreign exchange gain (loss) in the consolidated statements of operations and comprehensive income (loss). Revenue Recognition The Company generates revenue primarily from payment transaction fees processed through the Company’s platform. The fees are generated as a percentage of transaction value or a specified fee per transaction. For biller transactions the actual fees are dependent on payment type, payment channel or industry vertical. The payment transaction fees are received directly (i) from billers, who absorb the cost, or from customers in the form of a convenience-type fee, or (ii) from financial institutions. Transaction fees are collected for each completed transaction processed through the platform. The Company also earns other revenue, which primarily consists of maintenance revenue and subscription revenue. Other revenue represented approximately 1.1% of total revenue for the year ended December 31, 2024 and 1.3% for each of the years ended December 31, 2023 and 2022. Contract Liabilities Contract liabilities relate to fees billed in advance of services provided. The terms of the contract normally require the customer to pay a fixed monthly fee for hosting and maintenance, plus a non-refundable up-front fee for set-up, integration services, and data conversion at contract inception. The non-refundable up-front fees are typically billed in advance of services provided and are recorded as contract liability in the consolidated balance sheets. These fees are amortized ratably over the term of the agreement and recognized as revenue. The fixed monthly fee is for a promised service of hosting and maintenance. These services are provided over the same period and have the same pattern of transfer to the customer as the payment processing services. They are both stand-ready obligations satisfied ratably over the contractual period, and assessed as a single performance obligation. Therefore, they are recognized in the same manner as the variable consideration. Assets Recognized From the Costs to Obtain a Contract With a Customer The Company capitalizes certain costs to obtain contracts with customers, including employee sales commissions, when the commission is tied to new sales and is therefore considered an incremental cost of obtaining a customer. At contract inception, the Company capitalizes commission costs that the Company expects to recover and that would not have been incurred if the contract had not been obtained. For the years ended December 31, 2024 and 2023, the Company had capitalized sales commissions of $1.8 million and $1.0 million, respectively. As of December 31, 2024 and 2023, unamortized sales commissions were $2.1 million and $1.2 million, respectively, which are included in prepaid expenses and other assets in the consolidated balance sheets. Amortization of capitalized commissions to obtain customer contracts is included in sales and marketing expense in the consolidated statements of operations. The Company utilizes a straight-line method as it best depicts the pattern of transfer of the goods or services to the customer. The Company amortizes these assets over the expected period of benefit, which is typically three to five years. The Company evaluates contract costs for impairment by comparing, on a pooled basis, the expected future net cash flows from underlying customer relationships to the carrying amount of the capitalized contract costs. Some of the Company’s sales compensation paid to the sales force is earned based on the margins earned from the contract over the contract term and is contingent on continued employment with the Company by the salesperson. Sales commissions tied to key operating metrics other than new sales, are not considered incremental costs of obtaining a customer and are expensed in the same period as they are earned, rather than being capitalized. The Company records commission expense within sales and marketing expense in the consolidated statements of operations. The fair value of the warrant agreements with a reseller/vendor and customer or their affiliates, which was considered to be cost to obtain contracts with customers, was recognized as an asset. The fair value of the warrants was estimated on the grant date. The grant date fair value is determined using the Black-Scholes option pricing model, in accordance with ASC 718, Compensation-Stock Compensation, incorporating the Company's expectations regarding the number of warrants expected to vest in accordance with the warrant agreements. The Company accounts for consideration payable in the form of warrants as share-based compensation expense. Consideration payable to a customer or their affiliate was recorded as a reduction of the transaction price, thereby reducing revenue, following the guidance in ASC 606, while consideration payable to a reseller/vendor or their affiliate is recorded as an operating expense within sales and marketing expenses in the consolidated statements of operations. As of December 31, 2024 and 2023, unamortized warrants cost of $3.3 million and $4.5 million, respectively, were included in prepaid expenses and other assets in the consolidated balance sheets. For further details on warrant agreements, refer to Note 12 in the consolidated financial statements.
Cost of Revenue Cost of revenue consists primarily of interchange and assessment fees, processing fees and bank settlement fees paid to third-party payment processors and financial institutions, and personnel-related costs associated with the Company’s customer support teams, including salaries, benefits, and bonuses. Cost of revenue also includes an allocation of hosting and data center costs for the Company’s infrastructure and platform environment, telecommunication expenses used by sales and customer support teams, a portion of amortization of capitalized internal-use software development costs, and a portion of amortization of intangible assets acquired through acquisition. Research and Development Costs Research and development costs are expensed as incurred, unless they qualify as internal-use software development costs. Research and development expenses consist primarily of employee-related expenses associated with the Company’s research and development staff, including salaries, benefits, stock-based compensation and bonuses. Advertising Costs Advertising costs are expensed as incurred and are included in sales and marketing expenses in the consolidated statement of operations. These costs were $0.8 million, $1.3 million and $2.0 million for the years ended December 31, 2024, 2023 and 2022, respectively. Self-Insurance The Company is self-insured for a significant portion of its employee medical exposures. Liabilities for self-insured exposures are accrued at the present value of amounts expected to be paid based on historical claims experience and actuarial data for forecasted settlements of claims filed and for incurred but not yet reported claims. Accruals for self-insured exposures are included in current liabilities based on the expected periods of payment. Excess liability insurance has been purchased to limit the amount of self-insured risk on claims. Income Taxes The Company is subject to income taxes in the United States and numerous foreign jurisdictions. Significant judgment is required in determining its provision for income taxes and deferred tax assets and liabilities, including evaluating uncertainties in the application of accounting principles and complex tax laws. The Company records a provision for income taxes for the anticipated tax consequences of the reported results of operations using the asset and liability method. Under this method, the Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts for financial reporting purposes and the tax bases of assets and liabilities, as well as for loss and tax credit carryforwards. The deferred assets and liabilities are measured using the statutorily enacted tax rates anticipated to be in effect when those tax assets and liabilities are expected to be realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance is established if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company considers all available evidence, both positive and negative, including historical levels of income, expectations and risks associated with estimates of future taxable income in assessing the need for a valuation allowance. The Company’s tax positions are subject to income tax audits by multiple tax jurisdictions throughout the world. The Company recognizes the tax benefit of an uncertain tax position only if it is more likely than not the position will be sustainable upon examination by the taxing authority, including resolution of any related appeals or litigation processes. This evaluation is based on all available evidence and assumes that the tax authorities have full knowledge of all relevant information concerning the tax position. The tax benefit recognized is measured as the largest amount of benefit which is more likely than not (greater than 50% likely) to be realized upon ultimate settlement with the taxing authority. The Company recognizes interest accrued and penalties related to unrecognized tax benefits in income tax expense. The Company adjusts these reserves in accordance with the income tax guidance when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different from the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on the Company’s financial condition and operating results. Stock-based Compensation The Company measures and recognizes stock-based compensation expense for all stock-based awards, including grants of restricted stock units ("RSUs") and options to purchase stock granted to employees, outside directors and consultants based on the estimated fair value of the awards on the grant date of the award. The Company estimates the grant date fair value for options using the Black-Scholes option pricing model. The determination of the grant-date fair value using an option-pricing model is affected by the fair value of the Company’s common stock as well as assumptions regarding a number of other complex and subjective variables. These variables include expected stock price volatility over the expected term of the award, actual and projected employee stock option exercise behaviors, the risk-free interest rate for the expected term of the award, and expected dividends. The fair value of an RSU is measured using the market price of the Company's Class A common stock on the date of grant. Compensation cost is recognized on a straight-line basis over the employee requisite service period, which is the stated vesting period of the award, provided that total compensation cost recognized at least equals the pro rata value of the awards that have vested. Forfeitures are accounted for in the period in which they occur. For further details on the recognition and presentation of stock-based compensation expense, please refer to Note 13 in the consolidated financial statements. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents, which are composed of primarily bank deposits. Cash in the Company’s bank accounts may exceed federally insured limits. Restricted Cash and Cash Equivalents Restricted cash and cash equivalents consist of deposits required by certain counterparties to merchant counterparty processing agreements and required reserves under certain health insurance policies. Deposit balances are required through the term of the agreement and for six months following the termination of the merchant counterparty processing agreements. Custodial Accounts The Company has established a relationship with its merchant processors to act as collection and paying agents, whereby a merchant processor receives funds from customers and forwards such funds to the respective Paymentus client, based on the instructions received from the Company. These merchant processors act as custodians of the cash received and the Company has no legal ownership rights to the funds held in such custodial accounts and does not control the use of these funds. As the Company does not take ownership of the funds, these custodial accounts are not included in the Company’s consolidated balance sheets. The balance of cash in the custodial accounts held by these merchant processors was $147.2 million and $510.8 million as of December 31, 2024 and 2023, respectively. Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk primarily consist of cash, cash equivalents, and accounts receivable. The Company maintains its cash and cash equivalents with high-quality financial institutions with investment-grade ratings. For accounts receivable, the Company is exposed to credit risk in the event of nonpayment by customers to the extent of the amounts recorded in the consolidated balance sheets. No customer accounted for more than 10% of revenue for either of the years ended December 31, 2024, 2023 and 2022. One reseller accounted for more than 10% of accounts receivable for both December 31, 2024 and 2023. Fair Value Measurements The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: • Level 1 inputs - unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date; • Level 2 inputs - other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability; and • Level 3 inputs - unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. Due to their short maturities, the amounts reported on the consolidated balance sheet for accounts receivable, term deposits (recorded as prepaid expenses and other current assets and classified as Level 2 instrument), and accounts payable closely approximate their fair values. Accounts and Other Receivables and Allowance for Credit Losses Accounts receivable are recorded at invoiced amounts and do not bear interest. The Company will evaluate its accounts receivable portfolio to determine if an allowance for credit losses is necessary. The development of the allowance for credit losses is based on an expected loss model that considers reasonable and supportable forecasts of future conditions and a review of past due amounts, historical write-off and recovery experience. Provisions are established for outstanding balances on the basis of their age and the Company's assessment of their recoverability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet exposure related to its customers. As of December 31, 2024, and 2023, accounts receivable included rebate receivables of $6.7 million and $5.5 million, respectively, related to interchange and processing fees. Internal-use Software Development Costs The Company capitalizes qualifying internal-use software development costs related to its platform. The costs consist of personnel costs (including related benefits) that are incurred during the application development stage, as well as implementation costs incurred to fulfill our contracts with customers as they (1) relate directly to the contract, (2) are expected to generate resources that will be used to satisfy the performance obligation under the contract, and (3) are expected to be recovered through revenues generated under the contract. Capitalization of costs begins when two criteria are met: (1) the preliminary project stage is completed, and (2) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. Costs related to preliminary project activities and post implementation operating activities are expensed as incurred. Capitalized costs are amortized over the estimated useful life of the software, which management estimated to be a range of to five years, and are recorded on a straight-line basis, which represents the manner in which the expected benefit will be derived. Amortization expense is recorded in cost of revenue and operating expenses in the consolidated statement of operations aligned with the internal organizations that are the primary beneficiaries of such assets. Property and Equipment, Net Property and equipment, net is stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful life of the related asset as follows: Computer equipment.................................................................. 3 years Furniture and fixtures ................................................................. 5 years Leasehold improvements are amortized over the shorter of estimated useful life or the remaining lease term. Expenses that improve an asset or extend its remaining useful life are capitalized. Upon retirement or sale, the cost of assets disposed of, and the related accumulated depreciation, is removed from the accounts and any resulting gain or loss is reflected in other income (loss) in the consolidated statements of operations. Costs of maintenance or repairs that do not extend the lives of the respective assets are expensed as incurred. Business Combinations The purchase price of an acquisition is allocated to the tangible and intangible assets and liabilities assumed based on their estimated fair values at the acquisition dates. The excess of total consideration over the fair values of the assets acquired and the liabilities assumed is recorded as goodwill. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments would be recorded in the consolidated statements of operations. Impairment of Long-lived Assets (Including Goodwill and Intangible Assets) Long-lived assets with finite lives include property and equipment, capitalized internal-use software development costs, and acquired intangible assets. The Company evaluates long-lived assets, including intangible assets and capitalized internal-use software development costs, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by comparison of the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset exceeds these estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the assets exceeds the fair value of the asset or asset group. Goodwill is not amortized but rather tested at the reporting unit level for impairment at least annually in the fourth quarter, or more frequently if events or changes in circumstances indicate that goodwill may be impaired. The Company has three reporting units. Goodwill impairment is recognized when the quantitative assessment results in the carrying value of the reporting unit exceeding its fair value, in which case an impairment charge is recorded to goodwill to the extent the carrying value exceeds the fair value, limited to the amount of goodwill. See Note 6 for more information regarding the carrying value of goodwill by reporting unit. When reviewing goodwill for impairment, the Company performs a qualitative assessment which considers the following circumstances as well as others: • Changes in general macroeconomic conditions such as a deterioration in general economic conditions; limitations on accessing capital; or other developments in equity and credit markets; • Changes in industry and market conditions such as a deterioration in the environment in which the Company operates; an increased competitive environment; a decline in market-dependent multiples or metrics (in both absolute terms and relative to peers); a change in the market for an entity’s products or services; or a regulatory or political development; • Changes in cost factors that have a negative effect on earnings and cash flows; and • Decline in overall financial performance (for both actual and expected performance). The Company completed its annual goodwill impairment test as of November 30, 2024 using a qualitative assessment. The Company did not recognize any impairment of goodwill during the years ended December 31, 2024 or 2023. Leases The Company classifies leases as either operating or financing at inception and as necessary at modification. Leased assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. The Company does not obtain and control its right to use the identified asset until the lease commencement date. Although it may have a right and an obligation to exchange lease payments for a leased asset from the date of inception, the Company is unlikely to have an obligation to make lease payments before the asset is made available for use; therefore, lease classification, recognition, and measurement are determined at the lease commencement date. The Company made accounting policy elections, including a short-term lease exception policy, permitting the Company to not apply the recognition requirements of this standard to short-term leases (i.e., leases with expected terms of 12 months or less), and an accounting policy to account for lease and certain non-lease components as a single component for certain classes of assets other than computer equipment leases. For computer equipment leases, the Company has agreements with lease and non-lease components, which are accounted for separately. For these agreements, lease payments are allocated between the lease and non-lease components based on the relative stand-alone price of these components. The Company has leases for office facilities, computer equipment, and data centers. The Company’s leases have remaining initial lease terms of less than one year to approximately five years, some of which include options to extend the leases for up to 3 years, and some of which include options to terminate the leases. Operating leases are included in operating lease ROU assets, and operating lease liabilities on the Company’s consolidated balance sheets. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company uses the incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term and in a similar economic environment. The operating lease ROU asset also includes any initial direct costs, lease payments made prior to lease commencement, and lease incentives received. The Company’s lease terms are the noncancelable period including any rent-free periods provided by the lessor and may include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. At lease inception, and upon modification or remeasurement, the Company estimates the lease term based on its assessment of extension and termination options that are reasonably certain to be exercised. Lease cost for lease payments is recognized on a straight-line basis over the lease term. Leased property under finance leases are included in property and equipment, net. Finance lease liabilities are included within accrued liabilities, and finance lease and other finance obligations, net of current portion on the Company’s consolidated balance sheets. Property and equipment under finance leases is generally amortized over the lease term and is included in general and administrative expenses. The interest on the finance lease liabilities is included in interest income, net. Judgment is required when determining whether any of the Company’s data center contracts contain a lease. The Company concluded a lease exists when the asset is specifically identifiable, substantially all the economic benefit of the asset is obtained, and the right to direct the use of the asset exists during the term of the lease. Accounting Pronouncements The Company is provided the option to adopt new or revised accounting guidance as an "emerging growth company" under the Jumpstart Our Business Startups Act of 2012 either (1) within the same periods as those otherwise applicable to public business entities, or (2) within the same time periods as non-public business entities, including early adoption when permissible. With the exception of standards the Company elected to early adopt, when permissible, the Company has elected to adopt new or revised accounting guidance within the same time period as non-public business entities, as indicated below. Recently Adopted Accounting Pronouncements Accounting Standards Updates ("ASU") not listed below were assessed and determined to be either not applicable or are not expected to have a material impact on the consolidated financial statements. On January 1, 2024, the Company adopted ASU 2023-07, Segment Reporting—Improvements to Reportable Segment Disclosures, which requires public entities to provide disclosures of significant segment expenses and other segment items. The guidance requires public entities to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually and also applies to public entities with a single reportable segment. Entities are permitted to disclose more than one measure of a segment’s profit or loss if such measures are used by the CODM to allocate resources and assess performance, as long as at least one of those measures is determined in a way that is most consistent with the measurement principles used to measure the corresponding amounts in the consolidated financial statements. The Company adopted this standard which is effective beginning with our 2024 fiscal year Form 10-K, and it has been applied to all prior periods presented in the Consolidated Financial Statements. See Note 11 for additional information. Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09 "Income Tax Disclosures". ASU 2023-09 makes changes to annual disclosures of income taxes paid for all entities and requires entities to disclose the amount of income taxes paid, net of refunds received, disaggregated by federal, state and foreign jurisdiction. Additionally, entities are required to disclose income taxes paid, net of refunds received, for individual jurisdictions that comprise 5% or more of total income taxes paid. The 5% threshold is evaluated using the absolute value of the net refund or net payment in each jurisdiction compared to the absolute value of the total income taxes paid (net of refunds received). ASU 2023-09 requires all entities to disclose disaggregated domestic and foreign pre-tax income (or loss) from continuing operations along with disaggregated income tax expense (or benefit) by federal, state and foreign components. Such disaggregation by jurisdiction should classify taxes by jurisdiction based on the jurisdiction imposing the taxes. The amendments in ASU 2023-09 are effective for public companies for fiscal years beginning after December 15, 2024. Early adoption is permitted. The adoption of ASU 2023-09 is not expected to have a material impact on the Company's financial position or results of operations. On November 4, 2024, the FASB issued new guidance requiring additional disclosure of the nature of expenses included in the income statement in response to longstanding requests from investors for more information about an entity’s expenses. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. ASU 2024-03, Disaggregation of Income Statement Expenses (DISE), applies to all public business entities (PBEs) and is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The adoption of ASU 2024-03 is not expected to have a material impact on the Company's financial position or results of operations. |
Revenue Performance Obligations and Contract Balances |
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| Revenue, Performance Obligations and Contract Balances | 3. Revenue, Performance Obligations and Contract Balances Pursuant to ASC 606, the Company evaluates the services promised in contracts with customers at contract inception, and identifies a performance obligation for each promise to transfer a service that is distinct. For the payment transaction services, the promise to the customer is that the Company stands ready to process payment transactions the customer requests on a daily basis over the contract term. Since the timing and quantity of transactions to be processed by Paymentus is not determinable, the Company views payment services to comprise an obligation to stand ready to process as many transactions as the customer requests. Under a stand-ready obligation, the evaluation of the nature of a performance obligation is focused on each time increment rather than the underlying activities. Therefore, the Company views payment services to comprise a series of distinct days of service that are substantially the same and have the same pattern of transfer to the customer. Accordingly, the promise to stand ready is accounted for as a single-series performance obligation. ASC 606 requires that the Company determines for each customer arrangement whether revenue should be recognized at a point in time or over time. Substantially all of the Company’s revenues are recognized over time. The majority of the payment transaction services are priced as a percentage of transaction value or a specified fee per transaction. Given the nature of the promise based on unknown quantities or outcomes of services to be performed over the contract term, the total consideration is determined to be variable consideration. The variable consideration for the Company’s payment service is usage-based and, therefore, it specifically relates to the Company’s efforts to satisfy its payment services obligation. The variability is satisfied each day the service is provided to the customer. The Company directly assigns variable fees to the distinct day of service to which it relates, by considering the services performed each day. Therefore, Paymentus measures revenue for its payment service on a daily basis based on the services that are performed on that day and recognizes revenue once the transaction is complete. The initial term of customer contracts is typically between three to five years. Termination provisions vary by customer, however the majority of customers may not terminate their contract early without penalty. Some of the contracts include tiered pricing, based primarily on volume. The fee charged per transaction is adjusted up or down if the volume processed for a specified period is different from prior period defined volumes. The Company has concluded that this volume-based pricing approach does not constitute a future material right since the discount is within a range typically offered to a class of customers with similar volume. In addition, some contracts include prescribed annual or monthly minimums, penalties for early termination, and service level agreements that may affect contractual fees if specific service levels are not achieved. The Company has determined that these processing services represent a stand-ready obligation comprising a series of distinct days of services that are substantially the same and have the same pattern of transfer to the customer. The Company also has reseller and partner agreements, some of which contain guaranteed revenue or transaction minimum commitments and revenue sharing arrangements. Because of these minimum commitments, the Company has to evaluate the agreements to determine the fixed and variable consideration and the amount of revenue to be recognized. For the minimum commitments, the Company records the fixed consideration ratably over the commitment period and the variable consideration to the extent that the Company believes that the variable consideration is not constrained. The revenue recorded for these arrangements is net of any revenue sharing with the customer, which is typically determined based on a calculation of revenue less certain fees incurred by the Company, as defined in the agreement. The Company recognizes fees charged to customers primarily on a gross basis as transaction revenue when the Company is the principal in respect of completing a payment transaction. In order to provide payment services, the Company routes and clears each transaction through the applicable payment network. The Company obtains authorization for the transaction and requests funds settlement from the card issuing financial institution through the payment network. When third parties are involved in the transfer of goods or services to customers, the Company considers the nature of each specific promised good or service and applies judgment to determine whether the Company controls the good or service before it is transferred to the customer or whether the Company is acting as an agent of the third party. To determine whether or not the Company controls the good or service before it is transferred to the customer, the Company assesses indicators including whether the Company or the third party is primarily responsible for fulfillment and which party has discretion in determining pricing for the good or service, as well as other considerations. Based on an assessment of these indicators, the Company has concluded that the Company bears primary responsibility for the fulfillment of the payment service with the majority of the customers, contracts directly with customers, controls the product specifications, and defines the value proposal from the Company’s services. The Company therefore bears full margin risk when completing a payment transaction, and on that basis, controls those services prior to being transferred to the customer. The interchange fees charged by the card issuing financial institutions and the fees charged by the payment networks are recognized as transaction expense within cost of revenue in the consolidated statements of operations. The Company also evaluates and establishes a reserve for expected revenue reversals at the time revenue is recognized if it is probable that credit adjustments will occur and the amount can be reasonably estimated. The reserve is recorded as a reduction to revenue in the period the related revenue is recognized. The reserve amount is determined based on historical credit adjustment trends, customer-specific information, and other relevant factors. Accounts receivable included reserve balance of $1.0 million and $0.2 million for credit adjustments as of December 31, 2024, and 2023, respectively. ASC 606 requires disclosure of the aggregate amount of the transaction price allocated to unsatisfied performance obligations. As permitted by ASC 606, the Company has elected to exclude from this disclosure any contracts with an original duration of one year or less and any variable consideration that meets specified criteria. As described above, most significant performance obligations consist of variable consideration under a stand-ready series of distinct days of service. Such variable consideration meets the specified criteria for the disclosure exclusion; therefore, the majority of the aggregate amount of transaction price that is allocated to performance obligations that have not yet been satisfied is variable consideration that is not required for this disclosure. Disaggregation of Revenue The following table presents a disaggregation of revenue from contracts with customers (in thousands):
Remaining Performance Obligations As of December 31, 2024, the aggregate amount of transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied was $5.7 million, which the Company expects to recognize over 72% within the next two years, 21% between to four years and the remainder thereafter. The timing of revenue recognition within the next year is largely dependent upon the go-live dates of the Company's customers under the Company's contracts. As of December 31, 2024, the Company has contractual rights under its commercial agreements to receive $75.5 million of fixed consideration related to the future minimum guarantees through 2029. As permitted, the Company has elected to exclude from this disclosure any variable consideration that meets specified criteria. Accordingly, the total unsatisfied or partially unsatisfied performance obligations related to processing services is significantly higher than the amount disclosed. Contract Liabilities Contract liabilities consist of the following:
Revenue recognized during the year ended December 31, 2024 and 2023 that was included in the contract liabilities balance at the beginning of each of the periods was $3.9 million and $1.6 million, respectively. |
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Business Combinations |
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| Business Combinations | 4. Business Combinations PROFIT Financial, Inc. On December 19, 2022, the Company completed its acquisition of PROFIT Financial, Inc. ("PROFIT") by acquiring all outstanding shares of PROFIT for a total purchase price of approximately $4.3 million, net of cash acquired, comprised of $3.3 million cash of which $0.1 million is included as a short term payable at December 31, 2022 and a $0.6 million holdback by the Company for a period of 12 to 24 months following the transaction close date and is recorded in accrued liabilities in the consolidated balance sheets. In 2023, $0.2 million of the $0.6 million holdback was released to the former stockholders of PROFIT. PROFIT is a financial and accounting software company with offerings to small business. The acquisition was accounted for as a business combination and, accordingly, the total fair value of purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on their fair values on the acquisition date. The major classes of assets and liabilities to which the Company has allocated the fair value of purchase consideration were as follows (in thousands):
The finalization of the purchase price allocation did not result in any changes to the preliminary estimate. There were no measurement period adjustments during the year ended December 31, 2023. The goodwill recognized was primarily attributed to increased synergies that are expected to be achieved from the integration of PROFIT and the assembled workforce. The goodwill is not deductible for income tax purposes. The fair values and estimated useful lives of the acquired intangible assets by category were as follows (in thousands, except years):
Costs incurred for the PROFIT acquisition were not material. The revenue and expenses of the acquired business have been included in the Company's consolidated financial results since the acquisition date. |
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| Property and Equipment, Net | 5. Property and Equipment, Net Property and equipment, net consisted of the following (in thousands):
Depreciation expense recorded for property and equipment was $0.8 million, $0.9 million and $1.2 million for the years ended December 31, 2024, 2023 and 2022, respectively. |
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Goodwill, Internal-use Software Development Costs and Intangible Assets |
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| Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Goodwill, Internal-use Software Development Costs and Intangible Assets | 6. Goodwill, Internal-use Software Development Costs and Intangible Assets Goodwill The changes in the carrying amount of goodwill by reporting unit were as follows (in thousands):
Internal-use Software Development Costs During the years ended December 31, 2024, 2023 and 2022, the Company capitalized $36.2 million, $33.7 million and $29.8 million in software development costs, respectively. Amortization expense included in the consolidated statements of operations was as follows (in thousands):
Intangible Assets Intangible assets, net consisted of the following (in thousands):
Amortization expense of intangible assets was $8.1 million, $8.4 million and $8.3 million for the years ended December 31, 2024, 2023 and 2022 respectively. As of December 31, 2024, future expected amortization expense is as follows (in thousands):
There were no impairments of goodwill, internal-use software development costs or intangible assets in the years ended December 31, 2024, 2023 and 2022. |
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Prepaid expenses and other assets |
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| Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Prepaid expenses and other assets | 7. Prepaid expenses and other assets The composition of prepaid expenses and other assets is as follows (in thousands):
Contract acquisition costs consist of upfront customer contract discounts and unamortized warrants cost and sales commission. Other assets consist of security deposit for leased properties, investment in term deposits and inputs tax receivables. |
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Leases |
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| Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Leases | 8. Leases The Company enters into operating and finance leases, primarily related to rental of office space, equipment and data centers. Both operating and finance leases have remaining lease terms which range from less than one year to seven years, and often include one or more renewal or termination options. These options are not included in the determination of the lease term at commencement unless it is reasonably certain that the Company will exercise the option. The components of lease cost were as follows (in thousands):
Supplemental cash flow information related to leases was as follows (in thousands):
The total remaining lease payments under non-cancelable operating leases as of December 31, 2024 were as follows (in thousands):
As of December 31, 2024, and 2023, the weighted-average remaining lease term and discount rate for the Company’s operating leases were 4.6 years and 3.8%, and 5.5 years and 3.7%, respectively. |
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Accrued Liabilities |
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| Accrued Liabilities, Current [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Accrued Liabilities | 9. Accrued Liabilities The composition of accrued liabilities is as follows:
Other accrued liabilities consist of professional services, insurance and legal accruals, acquisition-related holdback liability, obligations related to agency commissions and refunds, as well as other miscellaneous accruals. |
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Commitments and Contingencies |
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| Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||
| Commitments and Contingencies | 10. Commitments and Contingencies Other Commitments The Company has entered into certain non-cancellable agreements for software and marketing services that specify all significant terms, including fixed or minimum services to be used, pricing provisions and the approximate timing of the transaction. Future minimum payments under other non-cancellable agreements as of December 31, 2024 were as follows (in thousands):
Retirement Plans The Company sponsors a 401(k) defined contribution plan covering all eligible U.S. employees. Contributions to the 401(k) plan are discretionary. The Company also has a Deferred Profit Sharing Plan covering all eligible Canadian employees. The Company made $1.6, $1.4 and $1.2 million of matching contributions to the two retirement plans for the years ended December 31, 2024, 2023 and 2022, respectively. Legal Matters From time to time, the Company is subject to or otherwise involved in various lawsuits, claims and legal proceedings that arise out of or are incidental to the conduct of our business, including those relating to employment matters, and contractual and other commercial disputes. The Company records a liability in its consolidated financial statements for these matters when a loss is known or considered probable and the amount can be reasonably estimated. The Company reviews these estimates each accounting period as additional information is known and adjusts the loss provision when appropriate. If a matter is both probable to result in a liability and the amounts of loss can be reasonably estimated, the Company estimates and records an accrued liability. Accrued liabilities related to legal matters are included within other accrued liabilities in Note 9. If the loss is not probable or cannot be reasonably estimated, a liability is not recorded in its consolidated financial statements. While it is not feasible to predict or determine the ultimate outcome of these matters, the Company believes that, as of December 31, 2024, except for estimated liabilities recorded in the consolidated financial statements, no current claims and legal proceedings are expected to have a material adverse effect on its financial position, results of operations, or cash flows. Indemnification The Company enters into indemnification provisions under agreements with other parties in the ordinary course of business, including business partners, investors, contractors, customers, and the Company’s officers, directors, and certain employees. The Company has agreed to indemnify and defend the indemnified party claims and related losses suffered or incurred by the indemnified party from actual or threatened third-party claims due to the Company’s activities or non-compliance with obligations or representations made by the Company. The Company generally seeks to limit, or cap, its indemnification exposure in its commercial and other contracts, although some agreements are not limited or capped. It is not possible to determine the maximum potential loss under these indemnification provisions due to the Company’s limited history of prior indemnification claims and the unique facts and circumstances involved in each particular provision. |
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Segment Reporting |
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| Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Segment Reporting | 11. Segment Reporting The Company conducts business in three operating segments based on geography. Based on quantitative criteria, it identifies the United States of America (“USA”) as its sole reporting segment. The USA segment is the primary driver of the Company’s consolidated revenues and represents the majority of its total consolidated assets. "Other" includes operations in Canada and India. The accounting policies of the segment are the same as those described in Note 2. The table below summarizes segment Gross Profit, including Revenue and Cost of sales (in thousands):
(1) Total Gross profit to income before income taxes is reconciled in the Consolidated Statements of Operations and Comprehensive Income (Loss). The CODM is provided with consolidated information on other operating expenses including sales and marketing, research and development, general and administrative expenses, as well as interest income and other expenses. There are no other significant expense categories regularly provided to the CODM beyond those disclosed in the Consolidated Statements of Operations. There are no intra-entity sales or transfers. The CODM manages the business using consolidated expense information, as well as regularly provided budgeted or forecasted revenue, cost of revenue and operating expenses information on a consolidated basis. Assets provided to the CODM are consistent with those reported on the Consolidated Balance Sheets with particular emphasis on the Company’s available liquidity, including its cash, cash equivalents and restricted cash and accounts receivable and reduced by current liabilities. The Company's long lived assets primarily consist of computer equipment and furniture. The table below summarizes long-lived assets based on its geographical area:
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Equity |
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| Equity | 12. Equity Preferred Stock The Company’s amended and restated certificate of incorporation authorizes the issuance of 5,000,000 shares of undesignated preferred stock with a par value of $0.0001 per share with rights and preferences, including voting rights, designated from time to time by the board of directors. The Company had no shares of preferred stock issued or outstanding at December 31, 2024 or 2023. Common Stock The Company has two classes of common stock: Class A common stock and Class B common stock. In connection with the IPO, the Company’s amended and restated certificate of incorporation became effective, which authorized the issuance of 883,950,000 shares of Class A common stock and 111,050,000 shares of Class B common stock. The shares of Class A common stock and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote. Each share of Class B common stock is entitled to ten votes. Class A and Class B common stock have a par value of $0.0001 per share, and are referred to as common stock throughout the notes to the consolidated financial statements, unless otherwise noted. Holders of common stock are entitled to receive any dividends as may be declared from time to time by the board of directors. Shares of Class B common stock may be converted to Class A common stock at any time at the option of the stockholder. Shares of Class B common stock automatically convert to Class A common stock upon the following: (i) sale or transfer of such share of Class B common stock; (ii) the death of the Class B common stockholder (or nine months after the date of death if the stockholder is one of the Company’s founders); and (iii) on the first trading day on or after the date on which the outstanding shares of Class B common stock represent less than 10% of the then outstanding Class A and Class B common stock. Following the conversion of all outstanding shares of Class B common stock into Class A common stock, no further shares of Class B common stock will be issued. Warrants On May 13, 2021, the Company entered into a warrant agreement with JPMC Strategic Investments I Corporation (“JPMC”), an affiliate of J.P. Morgan Securities LLC, an underwriter in our 2021 initial public offering ("IPO"), pursuant to which the Company agreed to issue a warrant to JPMC for up to 509,370 shares of Class A common stock upon completion of the IPO at an exercise price of $18.38 per share (the “May 2021 warrant agreement”). Upon completion of the IPO, 382,027 of the warrant shares vested and were exercisable. The vesting of the remaining 127,343 shares of Class A common stock underlying the warrant were subject to the achievement of certain commercial milestones through December 31, 2025 pursuant to a related commercial agreement with JPMorgan Chase Bank, National Association (“JPM Chase”), an affiliate of JPMC. As discussed below, this commercial agreement was amended in August 2022, and the achievement of certain commercial milestones was extended through December 31, 2026 and minimum revenue commitments were set for each of the calendar years through 2026. As of December 31, 2024 and 2023, 509,370 and 448,880 warrant shares respectively, were vested and exercisable under the May 2021 warrant agreement. On August 29, 2022, the Company entered into a second warrant agreement with JPMC, in connection with an amendment to the Company's existing commercial agreement with JPM Chase discussed above, pursuant to which the Company issued a warrant to JPMC for up to 684,510 shares of Class A common stock at an exercise price of $10.10 per share (the “August 2022 warrant agreement”). Upon signing the August 2022 warrant agreement, 171,128 of the warrant shares vested and were exercisable. The vesting of the remaining 513,382 shares of Class A common stock underlying the warrant were subject to the achievement of certain commercial milestones through December 31, 2026 pursuant to the commercial agreement, as amended. During 2024, the Company reassessed the probability relating to achievement of certain milestones related to the August 2022 warrant, the resulting increase of $ 0.8 million was recorded as additional paid-in capital and as contract acquisition cost included in prepaid expenses and other assets in the consolidated balance sheets. As of December 31, 2024 and 2023, 175,904 and 171,128 warrant shares were vested and exercisable under the August 2022 warrant agreement. Warrants granted, vested and exercisable by period, and unvested under outstanding JPMC warrant agreements are shown below:
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Stock-Based Compensation |
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| Share-Based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-Based Compensation | 13. Stock-Based Compensation In May 2021, the Company’s board of directors (the "Board") adopted, and its stockholders approved, the 2021 Equity Incentive Plan (the "2021 Plan"), which became effective in connection with the IPO. The 2021 Plan provides for the grant of incentive stock options, within the meaning of Section 422 of the Internal Revenue Code, to the Company's employees and any of its parent or subsidiary corporations’ employees, and for the grant of non-statutory stock options, restricted stock, restricted stock units, stock appreciation rights, and performance awards to the Company’s employees, directors and consultants and any of its parent or subsidiary corporations’ employees and consultants. A total of 10,459,000 shares of the Company’s Class A common stock have been reserved for issuance under the 2021 Plan in addition to (i) an annual increase of 4% of the outstanding shares of the Company's common stock, with Class A and Class B common stock taken together, on the first day of each fiscal year (subject to the Compensation Committee of the Board exercising discretion to increase or decrease such amount, the "Evergreen Addition") and (ii) upon the expiration, forfeiture, cancellation, or reacquisition of any shares of Class B common stock underlying outstanding stock awards granted under the 2012 Equity Incentive Plan, an equal number of shares of Class A common stock, such number of shares not to exceed 7,563,990. On January 1, 2023 and 2024, pursuant to the Evergreen Addition, approximately 4.9 million and 5.0 million shares of Class A common stock were added to the 2021 Plan issuance reserve. At December 31, 2024, there were 21.8 million remaining shares available for the Company to grant under the 2021 Plan. Stock Options A summary of the Company’s option activity during the year ended December 31, 2024 was as follows (in thousands, except share and per share amounts):
There were no options granted during the year ended December 31, 2024 and 2023. Aggregate intrinsic value represents the difference between the exercise price of the options and the fair value of the Company’s common stock. The aggregate intrinsic value of options exercised for the years ended December 31, 2024 and 2023 was $7.1 million and $1.6 million, respectively. The determination of the fair value of stock options on the date of grant using a Black-Scholes option-pricing model is affected by the fair value of the Company’s common stock, as well as assumptions regarding a number of variables that are complex, subjective and generally require significant judgment to determine. The valuation assumptions were determined as follows: Expected Term The expected life of options granted to employees was determined by using management’s best estimation of exercise activity. Risk-Free Interest Rate The Company utilizes a risk-free interest rate in the option valuation model based on U.S. Treasury zero-coupon issues, with remaining terms similar to the expected term of the options. Expected Volatility As the Company does not have an extensive trading history for its common stock, the expected volatility is based on the historical volatility of the Company’s publicly traded industry peers utilizing a period of time consistent with the Company’s estimate of expected term. Expected Dividend Yield The Company does not anticipate paying any cash dividends in the foreseeable future and, therefore, uses an expected dividend yield of zero in the option valuation model. Fair Value of Underlying Common Stock Prior to the IPO, our common stock was not yet publicly traded, therefore we estimated the fair value of common stock. Our board of directors considered numerous objective and subjective factors to determine the fair value of our common stock at each meeting in which awards are approved. These factors included historical and projected financial information, prospects and risks, company performance, various corporate documents, capitalization and economic and financial market conditions. Management, with its third-party valuation firm, also used other economic, industry and market information obtained from other resources considered reliable. After the IPO, the fair value of the shares of common stock underlying stock options was determined using publicly quoted price as reported on the New York Stock Exchange as the fair value of its common stock. At December 31, 2024, there was $0.1 million of total unrecognized compensation cost related to unvested stock options granted under the 2012 Equity Incentive Plan, which is expected to be recognized over a remaining weighted-average period of 0.9 years. Restricted Stock Units ("RSUs") A summary of the Company’s RSU activity during the year ended December 31, 2024 was as follows:
The fair value of RSU grants is determined based upon the market closing price of the Company's Class A common stock on the date of grant. RSUs vest over the requisite service period, which generally ranges between four years and five years from the date of grant for employees and one to three years for directors, subject to continued employment for employees and provision of services for non-employees. At December 31, 2024, there was $29.1 million of total unrecognized compensation cost related to unvested RSUs granted under the 2021 Plan, which is expected to be recognized over a remaining weighted-average period of 3.2 years.
Stock-Based Compensation Expense Stock-based compensation expense (including amortization of capitalized warrants cost for 2024 - see note 12) included in the consolidated statements of operations was as follows (in thousands):
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Income Taxes |
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| Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Taxes | 14. Income Taxes The components of income before income taxes were as follows (in thousands):
The provision for income taxes consisted of the following (in thousands):
The effective income tax rate differs from the federal statutory income tax rate applied to the income before provision for income taxes due to the following:
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities at December 31, 2024 and 2023 were as follows (in thousands):
The Company had a valuation allowance of $0.3 million and $2.5 million as of December 31, 2024 and 2023, respectively. During the third quarter of 2024, given demonstrated profitability net of permanent adjustments resulting in cumulative income in recent years and other positive factors including the utilization of federal net operating losses and continued forecasted profitability, the Company determined to release its valuation allowance against most US deferred tax assets, resulting in a discrete benefit during 2024 of $1.8 million. The Company retains a valuation allowance against certain foreign tax credits that are not more likely than not to be utilized. As of December 31, 2024, the Company had $0.4 million of federal and $7.2 million of state net operating loss carryforwards available to offset future taxable income. State net operating losses, if not utilized, will begin to expire in 2032. As of December 31, 2024 and 2023, the total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate was not material. Interest and penalties related to income tax matters are classified as a component of income tax expense and were immaterial for the years ended December 31, 2024, 2023, and 2022. Although it is possible that certain unrecognized tax benefits may increase or decrease within the next 12 months, the Company does not anticipate any significant changes to unrecognized tax benefits over the next 12 months. As of December 31, 2024, the Company is subject to ongoing examinations in various jurisdictions, but is not aware of any potential tax liabilities associated with the ongoing audits. The Company files income tax returns in the U.S. federal jurisdiction, various state jurisdictions, and in various international jurisdictions. The Company’s tax filings remain subject to audits by applicable tax authorities for a certain length of time following the tax year to which those filings relate. Tax years 2021 and forward generally remain open for examination for federal and state tax purposes. Tax years 2020 and forward generally remain open for examination for foreign tax purposes. The Company has not recorded foreign withholding taxes or deferred income tax liabilities related to undistributed earnings of foreign operations of approximately $13.0 million and $9.9 million as of December 31, 2024 and 2023, respectively, since such earnings are considered permanently reinvested. |
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Net Income (Loss) Per Share Attributable to Common Stock |
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| Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net Income (Loss) Per Share Attributable to Common Stock | 15. Net Income (Loss) Per Share Attributable to Common Stock Basic net income (loss) per share attributable to common stock is computed by dividing the net income for the period attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net income (loss) per share attributable to common stock is computed by giving effect to all potentially dilutive common stock equivalents to the extent they are dilutive. The dilutive effect of outstanding options, RSUs and warrants is reflected in diluted net income (loss) per share attributable to common stock by application of the treasury stock method. The calculation of diluted net income (loss) per share attributable to common stock excludes all anti-dilutive common shares. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a proportionate basis to each class of common stock and the resulting basic and diluted net income per share attributable to common stockholders are, therefore, the same for both Class A and Class B common stock on both an individual and combined basis. The following table sets forth the computation of basic and diluted net income (loss) per share attributable to common stock (in thousands except share and per share data):
The following table summarizes weighted average securities that were excluded from the computation of diluted net income per share attributable to common stock as their inclusion would have been antidilutive for the respective year:
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Geographic Information |
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| Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Geographic Information | 11. Segment Reporting The Company conducts business in three operating segments based on geography. Based on quantitative criteria, it identifies the United States of America (“USA”) as its sole reporting segment. The USA segment is the primary driver of the Company’s consolidated revenues and represents the majority of its total consolidated assets. "Other" includes operations in Canada and India. The accounting policies of the segment are the same as those described in Note 2. The table below summarizes segment Gross Profit, including Revenue and Cost of sales (in thousands):
(1) Total Gross profit to income before income taxes is reconciled in the Consolidated Statements of Operations and Comprehensive Income (Loss). The CODM is provided with consolidated information on other operating expenses including sales and marketing, research and development, general and administrative expenses, as well as interest income and other expenses. There are no other significant expense categories regularly provided to the CODM beyond those disclosed in the Consolidated Statements of Operations. There are no intra-entity sales or transfers. The CODM manages the business using consolidated expense information, as well as regularly provided budgeted or forecasted revenue, cost of revenue and operating expenses information on a consolidated basis. Assets provided to the CODM are consistent with those reported on the Consolidated Balance Sheets with particular emphasis on the Company’s available liquidity, including its cash, cash equivalents and restricted cash and accounts receivable and reduced by current liabilities. The Company's long lived assets primarily consist of computer equipment and furniture. The table below summarizes long-lived assets based on its geographical area:
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Related Party Transactions |
12 Months Ended |
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Dec. 31, 2024 | |
| Related Party Transactions [Abstract] | |
| Related Party Transactions | 16. Related Party Transactions Transactions involving related parties cannot be presumed to be carried out on an arm’s length basis due to the absence of free market forces that naturally exist in business dealings between two or more unrelated entities. Related party transactions may not always be favorable to the Company’s business and may include terms, conditions and agreements that are not necessarily beneficial to or in the best interest of the Company. The spouse of the Company’s Chief Executive Officer serves as a vice president for the Company. She received aggregate compensation, inclusive of her base salary and bonus, of $0.3 million for her employment with the Company for each of the years ended December 31, 2024, 2023 and 2022. In addition, the son of a member of the Company’s board of directors serves as a vice president of the Company. He received aggregate compensation, inclusive of his base salary and bonus, of $0.4 million for his employment with the Company for the year ended December 31, 2024 and $0.3 million for each of the years ended December 31, 2023 and 2022. In addition, for the year ended December 31, 2024, he received a grant of restricted stock units with a value of $0.4 million that vests over five years from the grant date, and for the years ended December 31, 2023 and 2022, he received grants of restricted stock units with an aggregate value of $1.1 million and $0.3 million, respectively, that each vest over four years from the grant date. |
Basis of Presentation and Summary of Significant Accounting Policies (Policies) |
12 Months Ended |
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Dec. 31, 2024 | |
| Accounting Policies [Abstract] | |
| Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). |
| Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and balances have been eliminated upon consolidation. |
| Segment Information | Segment Information Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker ("CODM") in deciding how to make operating decisions, allocate resources and assess performance. The Company has three operating segments based on geography. The United States segment represents the vast majority of the Company’s consolidated net sales and gross profit. The additional two operating segments, Canada and India, do not meet the quantitative thresholds for separate reporting, either individually or in the aggregate. None of the operating segments qualified for aggregation. The Company’s CODM is its chief executive officer. The CODM reviews financial information presented on a consolidated basis for purposes of making operating decision and allocating resources but evaluates the performance of the Company’s operating segments based on revenue and gross profit. The Company does not analyze discrete segment balance sheet information related to long-term assets as the business is managed on a consolidated basis. All other financial information is presented on a consolidated basis. See Note 11 for additional information. |
| Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Such estimates include revenue recognition, cost of revenue recognition, the allowance for credit losses, the lives of tangible and intangible assets, the valuation of acquired intangible assets and the recoverability or impairment of intangible assets, including goodwill, internal-use software development costs, valuation of stock warrants issued, stock-based compensation, and accounting for income taxes. The Company bases its estimates on historical experience and also on assumptions that management considers reasonable. The Company assesses these estimates on a regular basis; however, actual results could differ from these estimates. |
| Foreign Currency | Foreign Currency The reporting currency of the Company is the United States Dollar. The Company’s foreign subsidiaries use the local currency of their respective countries as their functional currency. Assets and liabilities are translated using the exchange rates at the balance sheet date. Revenue and expenses are translated at average exchange rates during the period. Equity transactions are translated using historical exchange rates. The effects of foreign currency translation adjustments are recorded in accumulated other comprehensive income (loss) or ("AOCI") as a component of stockholders' equity, and related periodic movements are summarized as a line item in the consolidated statements of operations and comprehensive income (loss). Gains and losses from the remeasurement of foreign currency transactions into the functional currency are recognized as foreign exchange gain (loss) in the consolidated statements of operations and comprehensive income (loss). |
| Revenue Recognition | Revenue Recognition The Company generates revenue primarily from payment transaction fees processed through the Company’s platform. The fees are generated as a percentage of transaction value or a specified fee per transaction. For biller transactions the actual fees are dependent on payment type, payment channel or industry vertical. The payment transaction fees are received directly (i) from billers, who absorb the cost, or from customers in the form of a convenience-type fee, or (ii) from financial institutions. Transaction fees are collected for each completed transaction processed through the platform. The Company also earns other revenue, which primarily consists of maintenance revenue and subscription revenue. Other revenue represented approximately 1.1% of total revenue for the year ended December 31, 2024 and 1.3% for each of the years ended December 31, 2023 and 2022. Contract Liabilities Contract liabilities relate to fees billed in advance of services provided. The terms of the contract normally require the customer to pay a fixed monthly fee for hosting and maintenance, plus a non-refundable up-front fee for set-up, integration services, and data conversion at contract inception. The non-refundable up-front fees are typically billed in advance of services provided and are recorded as contract liability in the consolidated balance sheets. These fees are amortized ratably over the term of the agreement and recognized as revenue. The fixed monthly fee is for a promised service of hosting and maintenance. These services are provided over the same period and have the same pattern of transfer to the customer as the payment processing services. They are both stand-ready obligations satisfied ratably over the contractual period, and assessed as a single performance obligation. Therefore, they are recognized in the same manner as the variable consideration. Assets Recognized From the Costs to Obtain a Contract With a Customer The Company capitalizes certain costs to obtain contracts with customers, including employee sales commissions, when the commission is tied to new sales and is therefore considered an incremental cost of obtaining a customer. At contract inception, the Company capitalizes commission costs that the Company expects to recover and that would not have been incurred if the contract had not been obtained. For the years ended December 31, 2024 and 2023, the Company had capitalized sales commissions of $1.8 million and $1.0 million, respectively. As of December 31, 2024 and 2023, unamortized sales commissions were $2.1 million and $1.2 million, respectively, which are included in prepaid expenses and other assets in the consolidated balance sheets. Amortization of capitalized commissions to obtain customer contracts is included in sales and marketing expense in the consolidated statements of operations. The Company utilizes a straight-line method as it best depicts the pattern of transfer of the goods or services to the customer. The Company amortizes these assets over the expected period of benefit, which is typically three to five years. The Company evaluates contract costs for impairment by comparing, on a pooled basis, the expected future net cash flows from underlying customer relationships to the carrying amount of the capitalized contract costs. Some of the Company’s sales compensation paid to the sales force is earned based on the margins earned from the contract over the contract term and is contingent on continued employment with the Company by the salesperson. Sales commissions tied to key operating metrics other than new sales, are not considered incremental costs of obtaining a customer and are expensed in the same period as they are earned, rather than being capitalized. The Company records commission expense within sales and marketing expense in the consolidated statements of operations. The fair value of the warrant agreements with a reseller/vendor and customer or their affiliates, which was considered to be cost to obtain contracts with customers, was recognized as an asset. The fair value of the warrants was estimated on the grant date. The grant date fair value is determined using the Black-Scholes option pricing model, in accordance with ASC 718, Compensation-Stock Compensation, incorporating the Company's expectations regarding the number of warrants expected to vest in accordance with the warrant agreements. The Company accounts for consideration payable in the form of warrants as share-based compensation expense. Consideration payable to a customer or their affiliate was recorded as a reduction of the transaction price, thereby reducing revenue, following the guidance in ASC 606, while consideration payable to a reseller/vendor or their affiliate is recorded as an operating expense within sales and marketing expenses in the consolidated statements of operations. As of December 31, 2024 and 2023, unamortized warrants cost of $3.3 million and $4.5 million, respectively, were included in prepaid expenses and other assets in the consolidated balance sheets. For further details on warrant agreements, refer to Note 12 in the consolidated financial statements. |
| Cost of Revenue | Cost of Revenue Cost of revenue consists primarily of interchange and assessment fees, processing fees and bank settlement fees paid to third-party payment processors and financial institutions, and personnel-related costs associated with the Company’s customer support teams, including salaries, benefits, and bonuses. Cost of revenue also includes an allocation of hosting and data center costs for the Company’s infrastructure and platform environment, telecommunication expenses used by sales and customer support teams, a portion of amortization of capitalized internal-use software development costs, and a portion of amortization of intangible assets acquired through acquisition. |
| Research and Development Costs | Research and Development Costs Research and development costs are expensed as incurred, unless they qualify as internal-use software development costs. Research and development expenses consist primarily of employee-related expenses associated with the Company’s research and development staff, including salaries, benefits, stock-based compensation and bonuses. |
| Advertising Costs | Advertising Costs Advertising costs are expensed as incurred and are included in sales and marketing expenses in the consolidated statement of operations. These costs were $0.8 million, $1.3 million and $2.0 million for the years ended December 31, 2024, 2023 and 2022, respectively. |
| Self-Insurance | Self-Insurance The Company is self-insured for a significant portion of its employee medical exposures. Liabilities for self-insured exposures are accrued at the present value of amounts expected to be paid based on historical claims experience and actuarial data for forecasted settlements of claims filed and for incurred but not yet reported claims. Accruals for self-insured exposures are included in current liabilities based on the expected periods of payment. Excess liability insurance has been purchased to limit the amount of self-insured risk on claims. |
| Income Taxes | Income Taxes The Company is subject to income taxes in the United States and numerous foreign jurisdictions. Significant judgment is required in determining its provision for income taxes and deferred tax assets and liabilities, including evaluating uncertainties in the application of accounting principles and complex tax laws. The Company records a provision for income taxes for the anticipated tax consequences of the reported results of operations using the asset and liability method. Under this method, the Company recognizes deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts for financial reporting purposes and the tax bases of assets and liabilities, as well as for loss and tax credit carryforwards. The deferred assets and liabilities are measured using the statutorily enacted tax rates anticipated to be in effect when those tax assets and liabilities are expected to be realized or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date. A valuation allowance is established if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company considers all available evidence, both positive and negative, including historical levels of income, expectations and risks associated with estimates of future taxable income in assessing the need for a valuation allowance. The Company’s tax positions are subject to income tax audits by multiple tax jurisdictions throughout the world. The Company recognizes the tax benefit of an uncertain tax position only if it is more likely than not the position will be sustainable upon examination by the taxing authority, including resolution of any related appeals or litigation processes. This evaluation is based on all available evidence and assumes that the tax authorities have full knowledge of all relevant information concerning the tax position. The tax benefit recognized is measured as the largest amount of benefit which is more likely than not (greater than 50% likely) to be realized upon ultimate settlement with the taxing authority. The Company recognizes interest accrued and penalties related to unrecognized tax benefits in income tax expense. The Company adjusts these reserves in accordance with the income tax guidance when facts and circumstances change, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different from the amounts recorded, such differences will affect the provision for income taxes in the period in which such determination is made and could have a material impact on the Company’s financial condition and operating results. |
| Stock-based Compensation | Stock-based Compensation The Company measures and recognizes stock-based compensation expense for all stock-based awards, including grants of restricted stock units ("RSUs") and options to purchase stock granted to employees, outside directors and consultants based on the estimated fair value of the awards on the grant date of the award. The Company estimates the grant date fair value for options using the Black-Scholes option pricing model. The determination of the grant-date fair value using an option-pricing model is affected by the fair value of the Company’s common stock as well as assumptions regarding a number of other complex and subjective variables. These variables include expected stock price volatility over the expected term of the award, actual and projected employee stock option exercise behaviors, the risk-free interest rate for the expected term of the award, and expected dividends. The fair value of an RSU is measured using the market price of the Company's Class A common stock on the date of grant. Compensation cost is recognized on a straight-line basis over the employee requisite service period, which is the stated vesting period of the award, provided that total compensation cost recognized at least equals the pro rata value of the awards that have vested. Forfeitures are accounted for in the period in which they occur. For further details on the recognition and presentation of stock-based compensation expense, please refer to Note 13 in the consolidated financial statements. |
| Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents, which are composed of primarily bank deposits. Cash in the Company’s bank accounts may exceed federally insured limits. |
| Restricted Cash and Cash Equivalents | Restricted Cash and Cash Equivalents Restricted cash and cash equivalents consist of deposits required by certain counterparties to merchant counterparty processing agreements and required reserves under certain health insurance policies. Deposit balances are required through the term of the agreement and for six months following the termination of the merchant counterparty processing agreements. |
| Custodial Accounts | Custodial Accounts The Company has established a relationship with its merchant processors to act as collection and paying agents, whereby a merchant processor receives funds from customers and forwards such funds to the respective Paymentus client, based on the instructions received from the Company. These merchant processors act as custodians of the cash received and the Company has no legal ownership rights to the funds held in such custodial accounts and does not control the use of these funds. As the Company does not take ownership of the funds, these custodial accounts are not included in the Company’s consolidated balance sheets. The balance of cash in the custodial accounts held by these merchant processors was $147.2 million and $510.8 million as of December 31, 2024 and 2023, respectively. |
| Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk primarily consist of cash, cash equivalents, and accounts receivable. The Company maintains its cash and cash equivalents with high-quality financial institutions with investment-grade ratings. For accounts receivable, the Company is exposed to credit risk in the event of nonpayment by customers to the extent of the amounts recorded in the consolidated balance sheets. No customer accounted for more than 10% of revenue for either of the years ended December 31, 2024, 2023 and 2022. One reseller accounted for more than 10% of accounts receivable for both December 31, 2024 and 2023. |
| Fair Value Measurements | Fair Value Measurements The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: • Level 1 inputs - unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date; • Level 2 inputs - other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability; and • Level 3 inputs - unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. Due to their short maturities, the amounts reported on the consolidated balance sheet for accounts receivable, term deposits (recorded as prepaid expenses and other current assets and classified as Level 2 instrument), and accounts payable closely approximate their fair values. |
| Accounts and Other Receivables and Allowance for Credit Losses | Accounts and Other Receivables and Allowance for Credit Losses Accounts receivable are recorded at invoiced amounts and do not bear interest. The Company will evaluate its accounts receivable portfolio to determine if an allowance for credit losses is necessary. The development of the allowance for credit losses is based on an expected loss model that considers reasonable and supportable forecasts of future conditions and a review of past due amounts, historical write-off and recovery experience. Provisions are established for outstanding balances on the basis of their age and the Company's assessment of their recoverability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance sheet exposure related to its customers. As of December 31, 2024, and 2023, accounts receivable included rebate receivables of $6.7 million and $5.5 million, respectively, related to interchange and processing fees. |
| Internal-use Software Development Costs | Internal-use Software Development Costs The Company capitalizes qualifying internal-use software development costs related to its platform. The costs consist of personnel costs (including related benefits) that are incurred during the application development stage, as well as implementation costs incurred to fulfill our contracts with customers as they (1) relate directly to the contract, (2) are expected to generate resources that will be used to satisfy the performance obligation under the contract, and (3) are expected to be recovered through revenues generated under the contract. Capitalization of costs begins when two criteria are met: (1) the preliminary project stage is completed, and (2) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. Costs related to preliminary project activities and post implementation operating activities are expensed as incurred. Capitalized costs are amortized over the estimated useful life of the software, which management estimated to be a range of to five years, and are recorded on a straight-line basis, which represents the manner in which the expected benefit will be derived. Amortization expense is recorded in cost of revenue and operating expenses in the consolidated statement of operations aligned with the internal organizations that are the primary beneficiaries of such assets. |
| Property and Equipment, Net | Property and Equipment, Net Property and equipment, net is stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful life of the related asset as follows: Computer equipment.................................................................. 3 years Furniture and fixtures ................................................................. 5 years Leasehold improvements are amortized over the shorter of estimated useful life or the remaining lease term. Expenses that improve an asset or extend its remaining useful life are capitalized. Upon retirement or sale, the cost of assets disposed of, and the related accumulated depreciation, is removed from the accounts and any resulting gain or loss is reflected in other income (loss) in the consolidated statements of operations. Costs of maintenance or repairs that do not extend the lives of the respective assets are expensed as incurred. |
| Business Combinations | Business Combinations The purchase price of an acquisition is allocated to the tangible and intangible assets and liabilities assumed based on their estimated fair values at the acquisition dates. The excess of total consideration over the fair values of the assets acquired and the liabilities assumed is recorded as goodwill. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments would be recorded in the consolidated statements of operations. |
| Impairment of Long-lived Assets (Including Goodwill and Intangible Assets) | Impairment of Long-lived Assets (Including Goodwill and Intangible Assets) Long-lived assets with finite lives include property and equipment, capitalized internal-use software development costs, and acquired intangible assets. The Company evaluates long-lived assets, including intangible assets and capitalized internal-use software development costs, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by comparison of the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset exceeds these estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the assets exceeds the fair value of the asset or asset group. Goodwill is not amortized but rather tested at the reporting unit level for impairment at least annually in the fourth quarter, or more frequently if events or changes in circumstances indicate that goodwill may be impaired. The Company has three reporting units. Goodwill impairment is recognized when the quantitative assessment results in the carrying value of the reporting unit exceeding its fair value, in which case an impairment charge is recorded to goodwill to the extent the carrying value exceeds the fair value, limited to the amount of goodwill. See Note 6 for more information regarding the carrying value of goodwill by reporting unit. When reviewing goodwill for impairment, the Company performs a qualitative assessment which considers the following circumstances as well as others: • Changes in general macroeconomic conditions such as a deterioration in general economic conditions; limitations on accessing capital; or other developments in equity and credit markets; • Changes in industry and market conditions such as a deterioration in the environment in which the Company operates; an increased competitive environment; a decline in market-dependent multiples or metrics (in both absolute terms and relative to peers); a change in the market for an entity’s products or services; or a regulatory or political development; • Changes in cost factors that have a negative effect on earnings and cash flows; and • Decline in overall financial performance (for both actual and expected performance). The Company completed its annual goodwill impairment test as of November 30, 2024 using a qualitative assessment. The Company did not recognize any impairment of goodwill during the years ended December 31, 2024 or 2023. |
| Leases | Leases The Company classifies leases as either operating or financing at inception and as necessary at modification. Leased assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. The Company does not obtain and control its right to use the identified asset until the lease commencement date. Although it may have a right and an obligation to exchange lease payments for a leased asset from the date of inception, the Company is unlikely to have an obligation to make lease payments before the asset is made available for use; therefore, lease classification, recognition, and measurement are determined at the lease commencement date. The Company made accounting policy elections, including a short-term lease exception policy, permitting the Company to not apply the recognition requirements of this standard to short-term leases (i.e., leases with expected terms of 12 months or less), and an accounting policy to account for lease and certain non-lease components as a single component for certain classes of assets other than computer equipment leases. For computer equipment leases, the Company has agreements with lease and non-lease components, which are accounted for separately. For these agreements, lease payments are allocated between the lease and non-lease components based on the relative stand-alone price of these components. The Company has leases for office facilities, computer equipment, and data centers. The Company’s leases have remaining initial lease terms of less than one year to approximately five years, some of which include options to extend the leases for up to 3 years, and some of which include options to terminate the leases. Operating leases are included in operating lease ROU assets, and operating lease liabilities on the Company’s consolidated balance sheets. Operating lease ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company uses the incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term and in a similar economic environment. The operating lease ROU asset also includes any initial direct costs, lease payments made prior to lease commencement, and lease incentives received. The Company’s lease terms are the noncancelable period including any rent-free periods provided by the lessor and may include options to extend or terminate the lease when it is reasonably certain that it will exercise that option. At lease inception, and upon modification or remeasurement, the Company estimates the lease term based on its assessment of extension and termination options that are reasonably certain to be exercised. Lease cost for lease payments is recognized on a straight-line basis over the lease term. Leased property under finance leases are included in property and equipment, net. Finance lease liabilities are included within accrued liabilities, and finance lease and other finance obligations, net of current portion on the Company’s consolidated balance sheets. Property and equipment under finance leases is generally amortized over the lease term and is included in general and administrative expenses. The interest on the finance lease liabilities is included in interest income, net. Judgment is required when determining whether any of the Company’s data center contracts contain a lease. The Company concluded a lease exists when the asset is specifically identifiable, substantially all the economic benefit of the asset is obtained, and the right to direct the use of the asset exists during the term of the lease. |
| Accounting Pronouncements | Accounting Pronouncements The Company is provided the option to adopt new or revised accounting guidance as an "emerging growth company" under the Jumpstart Our Business Startups Act of 2012 either (1) within the same periods as those otherwise applicable to public business entities, or (2) within the same time periods as non-public business entities, including early adoption when permissible. With the exception of standards the Company elected to early adopt, when permissible, the Company has elected to adopt new or revised accounting guidance within the same time period as non-public business entities, as indicated below. Recently Adopted Accounting Pronouncements Accounting Standards Updates ("ASU") not listed below were assessed and determined to be either not applicable or are not expected to have a material impact on the consolidated financial statements. On January 1, 2024, the Company adopted ASU 2023-07, Segment Reporting—Improvements to Reportable Segment Disclosures, which requires public entities to provide disclosures of significant segment expenses and other segment items. The guidance requires public entities to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually and also applies to public entities with a single reportable segment. Entities are permitted to disclose more than one measure of a segment’s profit or loss if such measures are used by the CODM to allocate resources and assess performance, as long as at least one of those measures is determined in a way that is most consistent with the measurement principles used to measure the corresponding amounts in the consolidated financial statements. The Company adopted this standard which is effective beginning with our 2024 fiscal year Form 10-K, and it has been applied to all prior periods presented in the Consolidated Financial Statements. See Note 11 for additional information. Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU 2023-09 "Income Tax Disclosures". ASU 2023-09 makes changes to annual disclosures of income taxes paid for all entities and requires entities to disclose the amount of income taxes paid, net of refunds received, disaggregated by federal, state and foreign jurisdiction. Additionally, entities are required to disclose income taxes paid, net of refunds received, for individual jurisdictions that comprise 5% or more of total income taxes paid. The 5% threshold is evaluated using the absolute value of the net refund or net payment in each jurisdiction compared to the absolute value of the total income taxes paid (net of refunds received). ASU 2023-09 requires all entities to disclose disaggregated domestic and foreign pre-tax income (or loss) from continuing operations along with disaggregated income tax expense (or benefit) by federal, state and foreign components. Such disaggregation by jurisdiction should classify taxes by jurisdiction based on the jurisdiction imposing the taxes. The amendments in ASU 2023-09 are effective for public companies for fiscal years beginning after December 15, 2024. Early adoption is permitted. The adoption of ASU 2023-09 is not expected to have a material impact on the Company's financial position or results of operations. On November 4, 2024, the FASB issued new guidance requiring additional disclosure of the nature of expenses included in the income statement in response to longstanding requests from investors for more information about an entity’s expenses. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. ASU 2024-03, Disaggregation of Income Statement Expenses (DISE), applies to all public business entities (PBEs) and is effective for annual reporting periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted. The adoption of ASU 2024-03 is not expected to have a material impact on the Company's financial position or results of operations. |
Revenue Performance Obligations and Contract Balances (Tables) |
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| Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Summary of Disaggregation of Revenue | The following table presents a disaggregation of revenue from contracts with customers (in thousands):
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| Summary of Contract Asset and Liability | Contract liabilities consist of the following:
Revenue recognized during the year ended December 31, 2024 and 2023 that was included in the contract liabilities balance at the beginning of each of the periods was $3.9 million and $1.6 million, respectively. |
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Business Combinations (Tables) - PROFIT Financial, Inc. [Member] |
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| Restructuring Cost and Reserve [Line Items] | ||||||||||||||||||||||||||||||||||||
| Schedule of Assets Acquired and Liabilities Assumed | The major classes of assets and liabilities to which the Company has allocated the fair value of purchase consideration were as follows (in thousands):
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| Schedule of Fair Value of Identified Intangible Assets and Useful Lives | The fair values and estimated useful lives of the acquired intangible assets by category were as follows (in thousands, except years):
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Property and Equipment, Net (Tables) |
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| Property, Plant and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Property and Equipment, Net | Property and equipment, net consisted of the following (in thousands):
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Goodwill, Internal-use Software Development Costs and Intangible Assets (Tables) |
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| Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Summary of Goodwill by Reporting Unit | The changes in the carrying amount of goodwill by reporting unit were as follows (in thousands):
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| Schedule of Amortization expense | Amortization expense included in the consolidated statements of operations was as follows (in thousands):
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| Summary of Intangible Assets | Intangible assets, net consisted of the following (in thousands):
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| Schedule of Expected Future Amortization Expense | As of December 31, 2024, future expected amortization expense is as follows (in thousands):
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Prepaid expenses and other assets (Tables) |
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| Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Prepaid expenses and other assets | The composition of prepaid expenses and other assets is as follows (in thousands):
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Leases (Tables) |
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| Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Components of Lease Cost | The components of lease cost were as follows (in thousands):
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| Summary of Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows (in thousands):
The total remaining lease payments under non-cancelable operating leases as of December 31, 2024 were as follows (in thousands): |
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| Summary of Remaining Lease Payments under Non-Cancelable Operating Leases |
As of December 31, 2024, and 2023, the weighted-average remaining lease term and discount rate for the Company’s operating leases were 4.6 years and 3.8%, and 5.5 years and 3.7%, respectively. |
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Accrued Liabilities (Tables) |
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| Accrued Liabilities, Current [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Summary of Accrued Liabilities | The composition of accrued liabilities is as follows:
Other accrued liabilities consist of professional services, insurance and legal accruals, acquisition-related holdback liability, obligations related to agency commissions and refunds, as well as other miscellaneous accruals. |
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Commitments and Contingencies (Tables) |
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| Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||
| Schedule of Future Minimum Payments for Non Cancellable Agreements | Future minimum payments under other non-cancellable agreements as of December 31, 2024 were as follows (in thousands):
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Segment Reporting (Tables) |
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| Summary of Long-lived Assets by Geographic Areas | The table below summarizes long-lived assets based on its geographical area:
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| Summary of Segment Gross Profit Including Revenue and Cost of Sales | The table below summarizes segment Gross Profit, including Revenue and Cost of sales (in thousands):
(1) Total Gross profit to income before income taxes is reconciled in the Consolidated Statements of Operations and Comprehensive Income (Loss). |
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Equity (Tables) |
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Dec. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule Of vested and were exercisable under the outstanding warrant agreements table text block | Warrants granted, vested and exercisable by period, and unvested under outstanding JPMC warrant agreements are shown below:
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Stock-Based Compensation (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-Based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Stock Option Activity | A summary of the Company’s option activity during the year ended December 31, 2024 was as follows (in thousands, except share and per share amounts):
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| Summary of RSU Activity | A summary of the Company’s RSU activity during the year ended December 31, 2024 was as follows:
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| Summary of Stock Based Compensation Expense | Stock-based compensation expense (including amortization of capitalized warrants cost for 2024 - see note 12) included in the consolidated statements of operations was as follows (in thousands):
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Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Components of Income Tax Expense (Benefit) | The components of income before income taxes were as follows (in thousands):
The provision for income taxes consisted of the following (in thousands):
|
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| Schedule of Effective Income Tax Rate Reconciliation | The effective income tax rate differs from the federal statutory income tax rate applied to the income before provision for income taxes due to the following:
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| Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company's deferred tax assets and liabilities at December 31, 2024 and 2023 were as follows (in thousands):
|
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Net Income (Loss) Per Share Attributable to Common Stock (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Schedule of Computation of Basic and Diluted Net Income Per Share Attributable to Common Stock | The following table sets forth the computation of basic and diluted net income (loss) per share attributable to common stock (in thousands except share and per share data):
|
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| Schedule of Common Stock Equivalents Excluded from Income (Loss) Per Diluted Share | The following table summarizes weighted average securities that were excluded from the computation of diluted net income per share attributable to common stock as their inclusion would have been antidilutive for the respective year:
|
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Revenue Performance Obligations and Contract Balances - Summary of Disaggregation of Revenue from Contracts with Customer (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Disaggregation Of Revenue [Line Items] | |||
| Revenue | $ 871,745 | $ 614,490 | $ 497,001 |
| Payment Transaction Processing Revenue [Member] | |||
| Disaggregation Of Revenue [Line Items] | |||
| Revenue | 861,736 | 606,595 | 490,377 |
| Other [Member] | |||
| Disaggregation Of Revenue [Line Items] | |||
| Revenue | $ 10,009 | $ 7,895 | $ 6,624 |
Revenue Performance Obligations and Contract Balances - Summary of Contract Asset and Liability (Details) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Disaggregation of Revenue [Line Items] | ||
| Contract liabilities | $ 2,937 | $ 4,089 |
| Non-current | 2,783 | 2,731 |
| Total contract liabilities | $ 5,720 | $ 6,820 |
Business Combinations - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
|---|---|---|---|---|
Dec. 19, 2022 |
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Restructuring Cost and Reserve [Line Items] | ||||
| Total Purchase price | $ 0 | $ 0 | $ 3,260 | |
| PROFIT Financial, Inc. [Member] | ||||
| Restructuring Cost and Reserve [Line Items] | ||||
| Total Purchase price | $ 4,300 | |||
| Cash Purchase Price | 3,300 | |||
| Short Term payable | 100 | |||
| Cash Held Back for Acquisition Closing | $ 600 | 600 | 600 | $ 600 |
| Holdback liability paid | $ 200 | $ 200 | ||
Business Combinations - Schedule Of Assets Acquired And Liabilities Assumed (Details) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
Dec. 19, 2022 |
|---|---|---|---|---|
| Business Acquisition [Line Items] | ||||
| Goodwill | $ 131,815 | $ 131,860 | $ 131,851 | |
| PROFIT Financial, Inc. [Member] | ||||
| Business Acquisition [Line Items] | ||||
| Cash | $ 261 | |||
| Intangible assets | 1,873 | |||
| Goodwill | 2,509 | |||
| Deferred taxes | (382) | |||
| Total | $ 4,261 |
Business Combinations - Schedule Of Fair Values And Estimated Useful Lives Of Intangible Assets (Details) - PROFIT Financial, Inc. [Member] $ in Thousands |
12 Months Ended |
|---|---|
|
Dec. 31, 2024
USD ($)
| |
| Acquired Finite-Lived Intangible Assets [Line Items] | |
| Fair value | $ 1,873 |
| Developed Technology [Member] | |
| Acquired Finite-Lived Intangible Assets [Line Items] | |
| Fair value | $ 1,828 |
| Estimated useful life | 4 years |
| Brand [Member] | |
| Acquired Finite-Lived Intangible Assets [Line Items] | |
| Fair value | $ 45 |
| Estimated useful life | 4 years |
Property and Equipment, Net - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Property Plant And Equipment [Line Items] | ||
| Total property and equipment | $ 8,277 | $ 8,170 |
| Less: Accumulated depreciation | (7,120) | (6,612) |
| Property and equipment, net | 1,157 | 1,558 |
| Computer Equipment [Member] | ||
| Property Plant And Equipment [Line Items] | ||
| Total property and equipment | 6,178 | 6,059 |
| Furniture And Fixtures [Member] | ||
| Property Plant And Equipment [Line Items] | ||
| Total property and equipment | 1,724 | 1,715 |
| Leasehold Improvements [Member] | ||
| Property Plant And Equipment [Line Items] | ||
| Total property and equipment | $ 375 | $ 396 |
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Property, Plant and Equipment [Abstract] | |||
| Depreciation, Depletion and Amortization | $ 0.8 | $ 0.9 | $ 1.2 |
Goodwill, Internal-use Software Development Costs and Intangible Assets - Summary of Goodwill by Reporting Units (Details) - USD ($) $ in Thousands |
12 Months Ended | |
|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
|
| Goodwill [Line Items] | ||
| Beginning Balance | $ 131,860 | $ 131,851 |
| Foreign currency translation adjustments | (45) | 9 |
| Ending Balance | 131,815 | 131,860 |
| United States [Member] | ||
| Goodwill [Line Items] | ||
| Beginning Balance | 131,028 | 131,028 |
| Foreign currency translation adjustments | 0 | 0 |
| Ending Balance | 131,028 | 131,028 |
| Other [Member] | ||
| Goodwill [Line Items] | ||
| Beginning Balance | 832 | 823 |
| Foreign currency translation adjustments | (45) | 9 |
| Ending Balance | $ 787 | $ 832 |
Goodwill, Internal-use Software Development Costs and Intangible Assets - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Finite-Lived Intangible Assets [Line Items] | |||
| Amortization of Intangible Assets | $ 8,100 | $ 8,400 | $ 8,300 |
| Capitalized internal-use software development costs | (36,119) | (33,699) | (29,763) |
| Software and Software Development Costs [Member] | |||
| Finite-Lived Intangible Assets [Line Items] | |||
| Capitalized internal-use software development costs | (36,200) | (33,700) | (29,800) |
| Computer Software, Intangible Asset [Member] | |||
| Finite-Lived Intangible Assets [Line Items] | |||
| Impairment of Intangible Assets (Excluding Goodwill) | $ 0 | $ 0 | $ 0 |
Goodwill, Internal-use Software Development Costs and Intangible Assets - Schedule of Amortization expense (Details) - Software and Software Development Costs [Member] - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Finite-Lived Intangible Assets [Line Items] | |||
| Amortizaion expense of capitalized software costs | $ 27,586 | $ 21,349 | $ 14,621 |
| Cost Of Revenue | |||
| Finite-Lived Intangible Assets [Line Items] | |||
| Amortizaion expense of capitalized software costs | 17,911 | 13,341 | 8,761 |
| Research and Development | |||
| Finite-Lived Intangible Assets [Line Items] | |||
| Amortizaion expense of capitalized software costs | $ 9,675 | $ 8,008 | $ 5,860 |
Goodwill, Internal-use Software Development Costs and Intangible Assets - Schedule of Expected Future Amortization Expense (Details) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Goodwill and Intangible Assets Disclosure [Abstract] | ||
| 2025 | $ 6,620 | |
| 2026 | 3,738 | |
| 2027 | 3,269 | |
| 2028 | 3,269 | |
| 2029 | 2,180 | |
| Total future amortization expense | $ 19,076 | $ 27,158 |
Prepaid expenses and other assets - Schedule of Prepaid expenses and other assets (Details) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Prepaid Expense and Other Assets [Abstract] | ||
| Prepaid expenses | $ 6,584 | $ 5,996 |
| Contract acquisition costs | 6,657 | 7,679 |
| Other assets | 2,832 | 1,861 |
| Total prepaid expenses and other assets | 16,073 | 15,536 |
| Prepaid expenses and other assets current | 13,058 | 10,505 |
| Prepaid expenses and other assets, less current portion | 3,015 | 5,031 |
| Total prepaid expenses and other assets: | $ 16,073 | $ 15,536 |
Leases - Additional Information (Details) |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Lessee Lease Description [Line Items] | ||
| Operating lease, remaining lease term | 4 years 7 months 6 days | 5 years 6 months |
| Lease discount rate | 3.80% | 3.70% |
| Minimum [Member] | ||
| Lessee Lease Description [Line Items] | ||
| Operating lease, remaining lease term | 1 year | |
| Maximum [Member] | ||
| Lessee Lease Description [Line Items] | ||
| Operating lease, remaining lease term | 7 years |
Leases - Schedule of Components of Lease Cost (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Leases [Abstract] | |||
| Amortization of right-of-use-assets | $ 0 | $ 66 | $ 268 |
| Interest on lease liabilities | 0 | 0 | 8 |
| Total finance lease costs | 0 | 66 | 276 |
| Operating lease costs | 2,389 | 2,150 | 2,460 |
| Short-term lease costs | 631 | 707 | 972 |
| Total lease costs | $ 3,020 | $ 2,923 | $ 3,708 |
Leases - Summary of Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Cash paid for amounts included in the measurement of lease liabilities | |||
| Operating cash flows for operating leases | $ 2,361 | $ 2,152 | $ 2,103 |
| Operating cash flows for finance lease | 0 | 0 | 8 |
| Financing cash flows for finance leases | 0 | 102 | 268 |
| Right-of-use assets obtained in exchange of operating lease obligations | $ 467 | $ 2,132 | $ 3,938 |
Leases - Summary of Remaining Lease Payments under Non-Cancelable Operating Leases (Details) $ in Thousands |
Dec. 31, 2024
USD ($)
|
|---|---|
| Operating Leases: | |
| 2025 | $ 2,424 |
| 2026 | 2,395 |
| 2027 | 1,438 |
| 2028 | 1,021 |
| 2029 | 832 |
| Thereafter | 936 |
| Total minimum lease payments including interest | 9,046 |
| Less imputed interest | (638) |
| Total lease liabilities | $ 8,408 |
Accrued Liabilities - Summary of Accrued Liabilities (Details) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Accrued Liabilities, Current [Abstract] | ||
| Payroll and employee-related expenses | $ 16,650 | $ 15,455 |
| Other accrued liabilities | 9,812 | 5,846 |
| Accrued liabilities | $ 26,462 | $ 21,301 |
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Commitments and Contingencies Disclosure [Abstract] | |||
| Other commitments, description | The Company has entered into certain non-cancellable agreements for software and marketing services that specify all significant terms, including fixed or minimum services to be used, pricing provisions and the approximate timing of the transaction. | ||
| Contributions under plan | $ 1.6 | $ 1.4 | $ 1.2 |
Commitments and Contingencies - Schedule of Future Minimum Payments for Non Cancellable Agreements (Details) $ in Thousands |
Dec. 31, 2024
USD ($)
|
|---|---|
| Commitments and Contingencies Disclosure [Abstract] | |
| 2025 | $ 7,716 |
| 2026 | 2,701 |
| 2027 | 526 |
| Other commitment | $ 10,943 |
Segment Reporting - Summary of Segment Gross Profit Including Revenue and Cost of Sales (Details) - USD ($) $ in Thousands |
12 Months Ended | ||||
|---|---|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|||
| Revenues From External Customers And Long Lived Assets [Line Items] | |||||
| Revenue | $ 871,745 | $ 614,490 | $ 497,001 | ||
| Cost of revenue | 633,575 | 432,148 | 347,323 | ||
| Gross Profit | 238,170 | 182,342 | 149,678 | ||
| Revenue and Sales Segment [Member] | |||||
| Revenues From External Customers And Long Lived Assets [Line Items] | |||||
| Revenue | 871,745 | 614,490 | 497,001 | ||
| Cost of revenue | 633,575 | 432,148 | 347,323 | ||
| Gross Profit | [1] | 238,170 | 182,342 | 149,678 | |
| United States [Member] | Revenue and Sales Segment [Member] | |||||
| Revenues From External Customers And Long Lived Assets [Line Items] | |||||
| Revenue | 856,374 | 603,120 | 487,084 | ||
| Cost of revenue | 625,405 | 426,488 | 342,275 | ||
| Gross Profit | 230,969 | 176,632 | 144,809 | ||
| Other [Member] | Revenue and Sales Segment [Member] | |||||
| Revenues From External Customers And Long Lived Assets [Line Items] | |||||
| Revenue | 15,371 | 11,370 | 9,917 | ||
| Cost of revenue | 8,170 | 5,660 | 5,048 | ||
| Gross Profit | $ 7,201 | $ 5,710 | $ 4,869 | ||
| |||||
Segment Reporting - Summary of Long-lived Assets by Geographic Areas (Details) - USD ($) $ in Thousands |
Dec. 31, 2024 |
Dec. 31, 2023 |
|---|---|---|
| Revenues From External Customers And Long Lived Assets [Line Items] | ||
| Long-lived assets, comprising property and equipment assets | $ 1,157 | $ 1,558 |
| United States [Member] | ||
| Revenues From External Customers And Long Lived Assets [Line Items] | ||
| Long-lived assets, comprising property and equipment assets | 450 | 558 |
| Other [Member] | ||
| Revenues From External Customers And Long Lived Assets [Line Items] | ||
| Long-lived assets, comprising property and equipment assets | $ 707 | $ 1,000 |
Segment Reporting (Additional Information) (Details) |
12 Months Ended |
|---|---|
|
Dec. 31, 2024
Segment
| |
| Segment Reporting [Abstract] | |
| Number of Operating Segments | 3 |
Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions |
12 Months Ended | |||
|---|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Aug. 29, 2022 |
May 13, 2021 |
|
| Class Of Stock [Line Items] | ||||
| Common stock, par value | $ 10.1 | $ 18.38 | ||
| Common Stock, Terms of Conversion | Shares of Class B common stock may be converted to Class A common stock at any time at the option of the stockholder. Shares of Class B common stock automatically convert to Class A common stock upon the following: (i) sale or transfer of such share of Class B common stock; (ii) the death of the Class B common stockholder (or nine months after the date of death if the stockholder is one of the Company’s founders); and (iii) on the first trading day on or after the date on which the outstanding shares of Class B common stock represent less than 10% of the then outstanding Class A and Class B common stock. Following the conversion of all outstanding shares of Class B common stock into Class A common stock, no further shares of Class B common stock will be issued. | |||
| Issue of warrant | 684,510 | 509,370 | ||
| Fully Vested | 171,128 | 382,027 | ||
| Vesting of the Remaining Shares of the Warrant | 513,382 | 127,343 | ||
| May 2021 Warrant Agreement [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Vested And Exercisable | 509,370 | 448,880 | ||
| August 2022 Warrant Agreement [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Vested And Exercisable | 175,904 | 171,128 | ||
| Warrants [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Vested And Exercisable | 685,274 | |||
| Equity, Increase | $ 0.8 | |||
| Warrants [Member] | May 2021 Warrant Agreement [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Vested And Exercisable | 509,370 | |||
| Warrants [Member] | August 2022 Warrant Agreement [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Vested And Exercisable | 175,904 | |||
| Class A Common Stock [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Common stock, shares authorized | 883,950,000 | 883,950,000 | ||
| Common Stock, Voting Rights | one | |||
| Common stock, par value | $ 0.0001 | $ 0.0001 | ||
| Common stock, shares issued | 32,136,989 | 20,758,603 | ||
| Class B Common Stock [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Common stock, shares authorized | 111,050,000 | 111,050,000 | ||
| Common Stock, Voting Rights | one | |||
| Common stock, par value | $ 0.0001 | $ 0.0001 | ||
| Common stock, shares issued | 92,699,294 | 103,062,508 | ||
| Undesignated Preferred Stock [Member] | ||||
| Class Of Stock [Line Items] | ||||
| Preferred stock, shares authorized | 5,000,000 | |||
| Preferred stock, par value | $ 0.0001 |
Stock-Based compensation - Schedule of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | |
|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
|
| Share-Based Payment Arrangement [Abstract] | ||
| Options Outstanding, Beginning | 3,849,350 | |
| Options exercised | (312,643) | |
| Options forfeited | (2,604) | |
| Options Outstanding, Ending | 3,534,103 | 3,849,350 |
| Options Outstanding, Exercisable | 3,513,856 | |
| Weighted Average Exercise Price, Beginning | $ 7.87 | |
| Weighted Average Exercise Price, Exercised | 1.08 | |
| Weighted Average Exercise Price, Forfeited | 8.66 | |
| Weighted Average Exercise Price, Ending | 8.47 | $ 7.87 |
| Weighted Average Exercise Price, Exercisable | $ 8.47 | |
| Weighted Average Remaining Contractual Term (years) | 4 years 3 months 3 days | 5 years 21 days |
| Weighted Average Remaining Contractual Term (years), Exercisable | 4 years 3 months | |
| Aggregate Intrinsic Value, Beginning | $ 38,505 | |
| Aggregate Intrinsic Value, Ending | 85,525 | $ 38,505 |
| Aggregate Intrinsic Value, Exercisable | $ 85,046 | |
Stock Based Compensation - Summary of RSU Activity (Details) - Restricted Stock Units (RSUs) [Member] |
12 Months Ended |
|---|---|
|
Dec. 31, 2024
$ / shares
shares
| |
| Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
| Awarded and unvested, Beginning Balance | shares | shares | 1,946,006 |
| Awards, Granted | shares | shares | 1,047,722 |
| Awards, Vested | shares | shares | (701,029) |
| Awards,Forfeited | shares | shares | (196,531) |
| Awarded and unvested, Ending Balance | shares | shares | 2,096,168 |
| Weighted Average Grant-Date Fair Value, Unvested, Beginning Balance | $ / shares | $ / shares | $ 12.74 |
| Weighted Average Grant-Date Fair Value, Granted | $ / shares | $ / shares | 19.24 |
| Weighted Average Grant-Date Fair Value, Vested | $ / shares | $ / shares | 12.89 |
| Weighted Average Grant-Date Fair Value, Forfeited | $ / shares | $ / shares | 11.89 |
| Weighted Average Grant-Date Fair Value, Unvested, Ending Balance | $ / shares | $ / shares | $ 16.01 |
Stock-Based compensation - Summary of Stock Based Compensation Expense (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
| Total stock-based compensation | $ 12,855 | $ 9,390 | $ 6,736 |
| Cost Of Revenue | |||
| Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
| Total stock-based compensation | 251 | 156 | 0 |
| Research and Development | |||
| Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
| Total stock-based compensation | 3,100 | 1,990 | 1,647 |
| Sales and Marketing [Member] | |||
| Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
| Total stock-based compensation | 5,639 | 2,808 | 1,736 |
| General and Administrative [Member] | |||
| Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
| Total stock-based compensation | $ 3,865 | $ 4,436 | $ 3,353 |
Income Taxes - Components of Income Before Income Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Income Tax Disclosure [Abstract] | |||
| United States | $ 49,116 | $ 21,225 | $ (4,579) |
| Foreign | 4,828 | 3,899 | 3,271 |
| Income (loss) before income taxes | $ 53,944 | $ 25,124 | $ (1,308) |
Income Taxes - The Provision for Income Taxes (Details) - USD ($) $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Current | |||
| Domestic | $ 9,983 | $ 1,327 | $ 1,303 |
| Foreign | 1,139 | 1,061 | 875 |
| Total | 11,122 | 2,388 | 2,178 |
| Deferred | |||
| Domestic | (1,331) | 388 | (3,020) |
| Foreign | (16) | 26 | 47 |
| Total | (1,347) | 414 | (2,973) |
| Provision for income taxes | $ 9,775 | $ 2,802 | $ (795) |
Income Taxes - The Income Before Provision for Income Taxes Due (Details) |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Income Tax Disclosure [Abstract] | |||
| Federal statutory rate | 21.00% | 21.00% | 21.00% |
| State taxes | 4.40% | 6.00% | (40.00%) |
| Non-deductible executive compensation | 2.80% | 2.50% | (32.40%) |
| Other permanent differences | 0.20% | 0.40% | (8.30%) |
| Excess tax benefit on stock-based compensation | (6.10%) | 0.00% | 675.60% |
| Difference in prior year tax filings from provision | (0.20%) | 1.10% | (22.60%) |
| Foreign tax rate differences | 0.10% | 0.30% | 0.10% |
| Valuation Allowance | (4.00%) | (21.30%) | (542.80%) |
| R&D Credits | (0.90%) | (0.40%) | 0.00% |
| Other | 0.80% | 1.60% | 10.20% |
| Effective Income Tax Rate Reconciliation, Percent, Total | 18.10% | 11.20% | 60.80% |
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands |
12 Months Ended | |
|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
|
| Operating Loss Carryforwards [Line Items] | ||
| Valuation allowance | $ 284 | $ 2,454 |
| Change in Deferred Tax Assets Valuation Allowance | 1,800 | |
| Undistributed earnings of foreign operations | 13,000 | $ 9,900 |
| State | ||
| Operating Loss Carryforwards [Line Items] | ||
| Net operating losses | 7,200 | |
| Federal | ||
| Operating Loss Carryforwards [Line Items] | ||
| Net operating losses | $ 400 |
Net Income (Loss) Per Share Attributable to Common Stock - Schedule of Computation of Basic and Diluted Net Income Per Share Attributable to Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Numerator: | |||
| Net Income (Loss) | $ 44,169 | $ 22,322 | $ (513) |
| Denominator: | |||
| Weighted-average shares of common stock - basic | 124,372,031 | 123,511,608 | 122,099,437 |
| Dilutive effect of stock options | 2,323,355 | 1,262,918 | 0 |
| Dilutive effect of RSUs | 850,024 | 271,754 | 0 |
| Dilutive effect of warrants | 169,212 | 25,549 | 0 |
| Weighted-average shares of common stock - diluted | 127,714,622 | 125,071,829 | 122,099,437 |
| Net income (loss) per share | |||
| Basic | $ 0.36 | $ 0.18 | $ 0 |
| Diluted | $ 0.35 | $ 0.18 | $ 0 |
Net Income (Loss) Per Share Attributable to Common Stock - Schedule of Common Stock Equivalents Excluded from Income (Loss) Per Diluted Share (Details) - shares |
12 Months Ended | ||
|---|---|---|---|
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|
| Employee Stock Option | |||
| Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
| Antidilutive securities | 0 | 0 | 5,335,115 |
| RSUs [Member] | |||
| Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
| Antidilutive securities | 171,101 | 1,055,467 | 996,256 |
| Warrants [Member] | |||
| Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
| Antidilutive securities | 0 | 417,132 | 456,602 |
Related Party Transactions - Additional Information (Details) - USD ($) $ in Millions |
Dec. 31, 2024 |
Dec. 31, 2023 |
Dec. 31, 2022 |
|---|---|---|---|
| Vice President (spouse of CEO) [Member] | |||
| Related Party Transaction [Line Items] | |||
| Aggregate compensation | $ 0.3 | $ 0.3 | $ 0.3 |
| Vice President (Son of board member) [Member] | |||
| Related Party Transaction [Line Items] | |||
| Aggregate compensation | 0.4 | 0.3 | 0.3 |
| Grants receivable | $ 0.4 | $ 1.1 | $ 0.3 |