10-Q 1 bcor-20220930.htm 10-Q bcor-20220930
2022Q3FALSE--12-31000106887500010688752022-01-012022-09-3000010688752022-10-25xbrli:shares00010688752022-09-30iso4217:USD00010688752021-12-31iso4217:USDxbrli:shares0001068875us-gaap:FinancialServiceMember2022-07-012022-09-300001068875us-gaap:FinancialServiceMember2021-07-012021-09-300001068875us-gaap:FinancialServiceMember2022-01-012022-09-300001068875us-gaap:FinancialServiceMember2021-01-012021-09-300001068875bcor:TaxSoftwareServicesMember2022-07-012022-09-300001068875bcor:TaxSoftwareServicesMember2021-07-012021-09-300001068875bcor:TaxSoftwareServicesMember2022-01-012022-09-300001068875bcor:TaxSoftwareServicesMember2021-01-012021-09-3000010688752022-07-012022-09-3000010688752021-07-012021-09-3000010688752021-01-012021-09-300001068875us-gaap:CommonStockMember2021-12-310001068875us-gaap:AdditionalPaidInCapitalMember2021-12-310001068875us-gaap:RetainedEarningsMember2021-12-310001068875us-gaap:TreasuryStockCommonMember2021-12-310001068875us-gaap:CommonStockMember2022-01-012022-03-310001068875us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-3100010688752022-01-012022-03-310001068875us-gaap:TreasuryStockCommonMember2022-01-012022-03-310001068875us-gaap:RetainedEarningsMember2022-01-012022-03-310001068875us-gaap:CommonStockMember2022-03-310001068875us-gaap:AdditionalPaidInCapitalMember2022-03-310001068875us-gaap:RetainedEarningsMember2022-03-310001068875us-gaap:TreasuryStockCommonMember2022-03-3100010688752022-03-310001068875us-gaap:CommonStockMember2022-04-012022-06-300001068875us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-3000010688752022-04-012022-06-300001068875us-gaap:TreasuryStockCommonMember2022-04-012022-06-300001068875us-gaap:RetainedEarningsMember2022-04-012022-06-300001068875us-gaap:CommonStockMember2022-06-300001068875us-gaap:AdditionalPaidInCapitalMember2022-06-300001068875us-gaap:RetainedEarningsMember2022-06-300001068875us-gaap:TreasuryStockCommonMember2022-06-3000010688752022-06-300001068875us-gaap:CommonStockMember2022-07-012022-09-300001068875us-gaap:AdditionalPaidInCapitalMember2022-07-012022-09-300001068875us-gaap:RetainedEarningsMember2022-07-012022-09-300001068875us-gaap:CommonStockMember2022-09-300001068875us-gaap:AdditionalPaidInCapitalMember2022-09-300001068875us-gaap:RetainedEarningsMember2022-09-300001068875us-gaap:TreasuryStockCommonMember2022-09-300001068875us-gaap:CommonStockMember2020-12-310001068875us-gaap:AdditionalPaidInCapitalMember2020-12-310001068875us-gaap:RetainedEarningsMember2020-12-310001068875us-gaap:TreasuryStockCommonMember2020-12-3100010688752020-12-310001068875us-gaap:CommonStockMember2021-01-012021-03-310001068875us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-3100010688752021-01-012021-03-310001068875us-gaap:RetainedEarningsMember2021-01-012021-03-310001068875us-gaap:CommonStockMember2021-03-310001068875us-gaap:AdditionalPaidInCapitalMember2021-03-310001068875us-gaap:RetainedEarningsMember2021-03-310001068875us-gaap:TreasuryStockCommonMember2021-03-3100010688752021-03-310001068875us-gaap:CommonStockMember2021-04-012021-06-300001068875us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-3000010688752021-04-012021-06-300001068875us-gaap:RetainedEarningsMember2021-04-012021-06-300001068875us-gaap:CommonStockMember2021-06-300001068875us-gaap:AdditionalPaidInCapitalMember2021-06-300001068875us-gaap:RetainedEarningsMember2021-06-300001068875us-gaap:TreasuryStockCommonMember2021-06-3000010688752021-06-300001068875us-gaap:CommonStockMember2021-07-012021-09-300001068875us-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300001068875us-gaap:RetainedEarningsMember2021-07-012021-09-300001068875us-gaap:CommonStockMember2021-09-300001068875us-gaap:AdditionalPaidInCapitalMember2021-09-300001068875us-gaap:RetainedEarningsMember2021-09-300001068875us-gaap:TreasuryStockCommonMember2021-09-3000010688752021-09-30bcor:segment0001068875us-gaap:OperatingSegmentsMemberbcor:WealthManagementMember2022-07-012022-09-300001068875us-gaap:OperatingSegmentsMemberbcor:WealthManagementMember2021-07-012021-09-300001068875us-gaap:OperatingSegmentsMemberbcor:WealthManagementMember2022-01-012022-09-300001068875us-gaap:OperatingSegmentsMemberbcor:WealthManagementMember2021-01-012021-09-300001068875us-gaap:OperatingSegmentsMemberbcor:TaxSoftwareMember2022-07-012022-09-300001068875us-gaap:OperatingSegmentsMemberbcor:TaxSoftwareMember2021-07-012021-09-300001068875us-gaap:OperatingSegmentsMemberbcor:TaxSoftwareMember2022-01-012022-09-300001068875us-gaap:OperatingSegmentsMemberbcor:TaxSoftwareMember2021-01-012021-09-300001068875us-gaap:CorporateNonSegmentMember2022-07-012022-09-300001068875us-gaap:CorporateNonSegmentMember2021-07-012021-09-300001068875us-gaap:CorporateNonSegmentMember2022-01-012022-09-300001068875us-gaap:CorporateNonSegmentMember2021-01-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:CommissionRevenueMemberbcor:WealthManagementMember2022-07-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:CommissionRevenueMemberbcor:WealthManagementMember2021-07-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:CommissionRevenueMemberbcor:WealthManagementMember2022-01-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:CommissionRevenueMemberbcor:WealthManagementMember2021-01-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2022-07-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2021-07-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2022-01-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2021-01-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMember2022-07-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMember2021-07-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMember2022-01-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:WealthManagementMember2021-01-012021-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMemberus-gaap:TransferredOverTimeMember2022-07-012022-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMemberus-gaap:TransferredOverTimeMember2021-07-012021-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMemberus-gaap:TransferredOverTimeMember2022-01-012022-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMemberus-gaap:TransferredOverTimeMember2021-01-012021-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2022-07-012022-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2021-07-012021-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2022-01-012022-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2021-01-012021-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:AssetBasedRevenueMember2022-07-012022-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:AssetBasedRevenueMember2021-07-012021-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:AssetBasedRevenueMember2022-01-012022-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:AssetBasedRevenueMember2021-01-012021-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:TransactionAndFeeRevenueMember2022-07-012022-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:TransactionAndFeeRevenueMember2021-07-012021-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:TransactionAndFeeRevenueMember2022-01-012022-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMemberbcor:TransactionAndFeeRevenueMember2021-01-012021-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2022-07-012022-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2021-07-012021-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2022-01-012022-09-300001068875bcor:WealthManagementMemberus-gaap:TransferredOverTimeMember2021-01-012021-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMember2022-07-012022-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMember2021-07-012021-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMember2022-01-012022-09-300001068875bcor:WealthManagementMemberbcor:AdvisoryRevenueMember2021-01-012021-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMember2022-07-012022-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMember2021-07-012021-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMember2022-01-012022-09-300001068875bcor:CommissionRevenueMemberbcor:WealthManagementMember2021-01-012021-09-300001068875bcor:WealthManagementMemberbcor:AssetBasedRevenueMember2022-07-012022-09-300001068875bcor:WealthManagementMemberbcor:AssetBasedRevenueMember2021-07-012021-09-300001068875bcor:WealthManagementMemberbcor:AssetBasedRevenueMember2022-01-012022-09-300001068875bcor:WealthManagementMemberbcor:AssetBasedRevenueMember2021-01-012021-09-300001068875bcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2022-07-012022-09-300001068875bcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2021-07-012021-09-300001068875bcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2022-01-012022-09-300001068875bcor:WealthManagementMemberbcor:TransactionAndFeeRevenueMember2021-01-012021-09-300001068875bcor:WealthManagementMember2022-07-012022-09-300001068875bcor:WealthManagementMember2021-07-012021-09-300001068875bcor:WealthManagementMember2022-01-012022-09-300001068875bcor:WealthManagementMember2021-01-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2022-07-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2021-07-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2022-01-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2021-01-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2022-07-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2021-07-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2022-01-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2021-01-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMember2022-07-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMember2021-07-012021-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMember2022-01-012022-09-300001068875us-gaap:TransferredAtPointInTimeMemberbcor:TaxSoftwareMember2021-01-012021-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2022-07-012022-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2021-07-012021-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2022-01-012022-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2021-01-012021-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMemberbcor:ProfessionalRevenueMember2022-07-012022-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMemberbcor:ProfessionalRevenueMember2021-07-012021-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMemberbcor:ProfessionalRevenueMember2022-01-012022-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMemberbcor:ProfessionalRevenueMember2021-01-012021-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2022-07-012022-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2021-07-012021-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2022-01-012022-09-300001068875bcor:TaxSoftwareMemberus-gaap:TransferredOverTimeMember2021-01-012021-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2022-07-012022-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2021-07-012021-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2022-01-012022-09-300001068875bcor:ConsumerRevenueMemberbcor:TaxSoftwareMember2021-01-012021-09-300001068875bcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2022-07-012022-09-300001068875bcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2021-07-012021-09-300001068875bcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2022-01-012022-09-300001068875bcor:TaxSoftwareMemberbcor:ProfessionalRevenueMember2021-01-012021-09-300001068875bcor:TaxSoftwareMember2022-07-012022-09-300001068875bcor:TaxSoftwareMember2021-07-012021-09-300001068875bcor:TaxSoftwareMember2022-01-012022-09-300001068875bcor:TaxSoftwareMember2021-01-012021-09-300001068875us-gaap:CustomerRelationshipsMember2022-01-012022-09-300001068875srt:MaximumMember2022-09-300001068875bcor:SeniorSecuredCreditFacilityMember2022-09-300001068875bcor:SeniorSecuredCreditFacilityMember2021-12-310001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMember2021-04-250001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMember2021-04-262021-04-260001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMember2021-04-260001068875bcor:TermLoanMember2022-09-300001068875us-gaap:RevolvingCreditFacilityMember2022-09-300001068875bcor:TermLoanMemberbcor:SeniorSecuredCreditFacilityMember2022-01-012022-09-300001068875bcor:SeniorSecuredCreditFacilityMember2022-08-052022-08-050001068875us-gaap:EurodollarMemberbcor:TermLoanMemberbcor:SeniorSecuredCreditFacilityMembersrt:MinimumMember2022-01-012022-09-30xbrli:pure0001068875us-gaap:EurodollarMemberbcor:TermLoanMemberbcor:SeniorSecuredCreditFacilityMember2022-01-012022-09-300001068875bcor:TermLoanMemberus-gaap:BaseRateMemberbcor:SeniorSecuredCreditFacilityMember2022-01-012022-09-300001068875us-gaap:EurodollarMemberus-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMembersrt:MinimumMember2022-01-012022-09-300001068875us-gaap:EurodollarMemberus-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMembersrt:MaximumMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberus-gaap:BaseRateMemberbcor:SeniorSecuredCreditFacilityMembersrt:MinimumMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberus-gaap:BaseRateMemberbcor:SeniorSecuredCreditFacilityMembersrt:MaximumMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMembersrt:MinimumMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMembersrt:MaximumMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberbcor:April12021ThroughDecember312021Memberbcor:SeniorSecuredCreditFacilityMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberbcor:January12022ThroughSeptember302022Memberbcor:SeniorSecuredCreditFacilityMember2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMemberbcor:October12022ThroughDecember312022Member2022-01-012022-09-300001068875us-gaap:RevolvingCreditFacilityMemberbcor:SeniorSecuredCreditFacilityMemberbcor:January12023ThroughFebruary212024Member2022-01-012022-09-300001068875bcor:HonkampKruegerFinancialServicesIncMember2022-09-300001068875bcor:HonkampKruegerFinancialServicesIncMember2021-12-310001068875bcor:HonkampKruegerFinancialServicesIncMember2020-07-012020-07-010001068875bcor:HonkampKruegerFinancialServicesIncMember2020-07-010001068875bcor:HonkampKruegerFinancialServicesIncMember2021-07-012021-09-300001068875us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-09-300001068875us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875us-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-09-300001068875us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875bcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875bcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-09-300001068875us-gaap:FairValueInputsLevel2Memberbcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875us-gaap:FairValueInputsLevel3Memberbcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMember2022-09-300001068875us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875us-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2021-12-310001068875us-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875us-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875us-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2021-12-310001068875us-gaap:FairValueInputsLevel2Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875bcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875bcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2021-12-310001068875us-gaap:FairValueInputsLevel2Memberbcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875us-gaap:FairValueInputsLevel3Memberbcor:HonkampKruegerFinancialServicesIncMemberus-gaap:FairValueMeasurementsRecurringMember2021-12-310001068875us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2021-12-3100010688752021-01-012021-12-310001068875bcor:TermLoanMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-09-300001068875bcor:TermLoanMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-09-300001068875bcor:TermLoanMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001068875bcor:TermLoanMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001068875us-gaap:DisposalGroupDisposedOfByMeansOtherThanSaleNotDiscontinuedOperationsMemberbcor:TaxSoftwareBusinessMemberus-gaap:SubsequentEventMember2022-10-312022-10-31

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

  
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                          to                     
Commission File Number: 000-25131
bcor-20220930_g1.jpg
Blucora, Inc.
(Exact name of registrant as specified in its charter)
Delaware91-1718107
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
3200 Olympus Blvd, Suite 100, Dallas, Texas 75019
(Address of principal executive offices) (Zip Code)
(972870-6400
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.0001 per shareBCORNASDAQ Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. ý Yes o No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  ý Yes o No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
ý
Accelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ý No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
As of October 25, 2022, 47,884,243 shares of the registrant’s Common Stock were outstanding.



TABLE OF CONTENTS
Page
Item 1.
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
This report includes some of the trademarks, trade names, and service marks of Blucora, Inc. (referred to throughout this report as “Blucora,” the “Company,” “we,” “us,” or “our”), including Blucora, Avantax Wealth Management, Avantax Planning Partners, Avantax Retirement Plan Services, HD Vest, 1st Global, HKFS, and TaxAct. Each one of these trademarks, trade names, or service marks is either (i) our registered trademark, (ii) a trademark for which we have a pending application, (iii) a trade name or service mark for which we claim common law rights, or (iv) a registered trademark or application for registration that we have been authorized by a third party to use.
Solely for convenience, the trademarks, service marks, and trade names included in this report are without the ®, ™ or other applicable symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensors to these trademarks, service marks, and trade names. This report may also include additional trademarks, service marks, and trade names of others, which are the property of their respective owners. All trademarks, service marks, and trade names included in this report are, to our knowledge, the property of their respective owners.
References to our or our subsidiaries’ website addresses or the website addresses of third parties in this report do not constitute incorporation by reference of the information contained on such websites and should not be considered part of this report.

Blucora, Inc. | Q3 2022 Form 10-Q 2


CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (“Form 10-Q”) contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. Many of the forward-looking statements are located in Part I, Item 2 of this Form 10-Q under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Forward-looking statements can also be identified by words such as “anticipates,” “believes,” “plans,” “expects,” “future,” “intends,” “may,” “will,” “would,” “could,” “should,” “estimates,” “predicts,” “potential,” “continues,” “target,” “outlook,” and similar terms and expressions, but the absence of these words does not mean that the statement is not forward-looking. Actual results may differ significantly from management’s expectations due to various risks and uncertainties including, but not limited to:
our ability to effectively compete within our industries;
our ability to generate strong performance for our clients and the impact of the financial markets on our clients’ portfolios;
our expectations concerning the revenues we generate from fees associated with the financial products that we distribute;
our ability to attract and retain financial professionals, employees, clients, and customers, as well as our ability to provide strong customer/client service;
our future capital requirements and the availability of financing, if necessary;
our ability to meet our current and future debt service obligations, including our ability to maintain compliance with our debt covenants;
any downgrade of the Company’s credit ratings;
the impact of new or changing legislation and regulations (or interpretations thereof) on our business, including our ability to successfully address and comply with such legislation and regulations (or interpretations thereof) and increased costs, reductions of revenue, and potential fines, penalties, or disgorgement to which we may be subject as a result thereof;
risks, burdens, and costs, including fines, penalties, or disgorgement, associated with our business being subjected to regulatory inquiries, investigations, or initiatives, including those of the Financial Industry Regulatory Authority, Inc. and the Securities and Exchange Commission (the “SEC”);
risks associated with legal proceedings, including litigation and regulatory proceedings;
our ability to close, finance, and realize all of the anticipated benefits of acquisitions, as well as our ability to integrate the operations of recently acquired businesses, and the potential impact of such acquisitions on our existing indebtedness and leverage;
our ability to retain employees and acquired client assets following acquisitions;
any compromise of confidentiality, availability or integrity of information, including cyberattacks;
our ability to manage leadership and employee transitions, including costs and time burdens on management and our board of directors related thereto;
political and economic conditions and events that directly or indirectly impact the wealth management and tax software industries;
the impact of the continuing COVID-19 pandemic on our results of operations and our business, including the impact of the resulting economic and market disruption, the extension of tax filing deadlines and other related government actions, and changes in customer behavior related to the foregoing;
our ability to maintain our relationships with third-party partners, providers, suppliers, vendors, distributors, contractors, financial institutions, industry associations, and licensing partners, and our expectations regarding and reliance on the products, tools, platforms, systems, and services provided by these third parties;
our ability to respond to rapid technological changes, including our ability to successfully release new products and services or improve upon existing products and services;
risks related to goodwill and acquired intangible asset impairment;
Blucora, Inc. | Q3 2022 Form 10-Q 3


our ability to develop, establish, and maintain strong brands;
risks associated with the use and implementation of information technology and the effect of security breaches, computer viruses, and computer hacking attacks;
our ability to comply with laws and regulations regarding privacy and protection of user data;
the seasonality of our business;
our assessments and estimates that determine our effective tax rate;
our ability to protect our intellectual property and the impact of any claim that we infringed on the intellectual property rights of others;
disruptions to our business and operations resulting from our agreement to sell our Tax Software business (or the announcement thereof);
our inability to successfully close the sale of our Tax Software business;
our failure to realize the expected benefits of the transaction if it does close;
if we are unable to secure financing on desirable terms after the consummation of the sale of our Tax Software business, our capital structure may include limited or no indebtedness and we may not be able to return capital to stockholders in the amount anticipated; and
the effects on our business of actions of activist stockholders.
Forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors that may cause our results, levels of activity, performance, achievements, and prospects to be materially different from those expressed or implied by such forward-looking statements. These risks, uncertainties, and other factors include, among others, the risk factors set forth in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, as well as in our other filings with the SEC. All forward-looking statements speak only as of the date of this Form 10-Q. We do not undertake any obligation and do not intend to update or revise any forward-looking statement to reflect new information, events, or circumstances after the date of this Form 10-Q or to reflect the occurrence of unanticipated events, except as required by law.




Blucora, Inc. | Q3 2022 Form 10-Q 4


PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
BLUCORA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
September 30,
2022
December 31,
2021
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents$91,104 $134,824 
Accounts receivable, net 25,683 21,906 
Commissions and advisory fees receivable20,486 25,073 
Prepaid expenses and other current assets19,670 18,476 
Total current assets156,943 200,279 
Long-term assets:
Property, equipment, and software, net75,086 73,638 
Right-of-use assets, net19,753 20,466 
Goodwill, net454,821 454,821 
Acquired intangible assets, net288,610 302,289 
Other long-term assets30,376 20,450 
Total long-term assets868,646 871,664 
Total assets$1,025,589 $1,071,943 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable$3,804 $8,216 
Commissions and advisory fees payable13,803 17,940 
Accrued expenses and other current liabilities33,948 65,678 
Current deferred revenue5,908 13,180 
Current lease liabilities5,112 4,896 
Current portion of long-term debt 1,812 
Total current liabilities62,575 111,722 
Long-term liabilities:
Long-term debt, net521,094 553,134 
Long-term lease liabilities31,176 33,267 
Deferred tax liabilities, net19,546 20,124 
Long-term deferred revenue4,627 5,322 
Other long-term liabilities14,981 6,752 
Total long-term liabilities591,424 618,599 
Total liabilities653,999 730,321 
Commitments and contingencies (Note 8)
Stockholders’ equity:
Common stock, par value $0.0001 per share—900,000 shares authorized; 50,955 shares issued and 47,774 shares outstanding as of September 30, 2022; 50,137 shares issued and 48,831 shares outstanding at December 31, 2021
5 5 
Additional paid-in capital1,632,569 1,619,805 
Accumulated deficit(1,197,585)(1,249,789)
Treasury stock, at cost—3,181 shares as of September 30, 2022 and 1,306 shares as of December 31, 2021
(63,399)(28,399)
Total stockholders’ equity371,590 341,622 
Total liabilities and stockholders’ equity$1,025,589 $1,071,943 

See accompanying notes.
Blucora, Inc. | Q3 2022 Form 10-Q 5


BLUCORA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) (In thousands, except per share amounts)

 Three Months Ended September 30,Nine Months Ended
September 30,
 2022202120222021
Revenue:
Wealth Management$165,032 $169,135 $494,104 $486,021 
Tax Software6,664 5,039 242,028 220,848 
Total revenue171,696 174,174 736,132 706,869 
Operating expenses:
Cost of revenue:
Wealth Management 105,301 120,641 338,819 343,174 
Tax Software 3,879 2,323 20,178 12,330 
Total cost of revenue109,180 122,964 358,997 355,504 
Engineering and technology7,474 7,874 24,598 22,233 
Sales and marketing30,485 28,399 162,396 140,809 
General and administrative27,778 23,102 83,499 71,619 
Acquisition and integration416 2,241 (4,710)28,513 
Depreciation3,839 2,867 9,907 8,371 
Amortization of acquired intangible assets6,342 7,009 19,435 21,247 
Total operating expenses185,514 194,456 654,122 648,296 
Operating income (loss)(13,818)(20,282)82,010 58,573 
Interest expense and other, net(9,749)(8,295)(25,707)(24,202)
Income (loss) before income taxes(23,567)(28,577)56,303 34,371 
Income tax benefit (expense)1,726 774 (4,099)(2,920)
Net income (loss)$(21,841)$(27,803)$52,204 $31,451 
Net income (loss) per share:
Basic$(0.46)$(0.57)$1.09 $0.65 
Diluted$(0.46)$(0.57)$1.06 $0.64 
Weighted average shares outstanding:
Basic47,847 48,707 47,981 48,492 
Diluted47,847 48,707 49,153 49,373 

















See accompanying notes.
Blucora, Inc. | Q3 2022 Form 10-Q 6


BLUCORA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited) (In thousands)
Common stockAdditional paid-in capitalAccumulated deficitTreasury stock
SharesAmountSharesAmountTotal
Balance as of December 31, 202150,137 $5 $1,619,805 $(1,249,789)1,306 $(28,399)$341,622 
Common stock issued pursuant to stock incentive and employee stock purchase plans247 — 96 — — — 96 
Stock repurchases— — — — 1,645 (30,537)(30,537)
Stock-based compensation— — 4,641 — — — 4,641 
Tax payments from shares withheld for equity awards— — (1,569)— — — (1,569)
Net income— — — 34,620 — — 34,620 
Balance as of March 31, 202250,384 $5 $1,622,973 $(1,215,169)2,951 $(58,936)$348,873 
Common stock issued pursuant to stock incentive and employee stock purchase plans537 — 2,402 — — — 2,402 
Stock repurchases— — — — 230 (4,463)(4,463)
Stock-based compensation— — 3,683 — — — 3,683 
Tax payments from shares withheld for equity awards— — (467)— — — (467)
Net income— — — 39,425 — — 39,425 
Balance as of June 30, 202250,921 $5 $1,628,591 $(1,175,744)3,181 $(63,399)$389,453 
Common stock issued pursuant to stock incentive and employee stock purchase plans34 — 307 — — — 307 
Stock-based compensation— — 3,725 — — — 3,725 
Tax payments from shares withheld for equity awards— — (54)— — — (54)
Net loss— — — (21,841)— — (21,841)
Balance as of September 30, 202250,955 $5 $1,632,569 $(1,197,585)3,181 $(63,399)$371,590 
Common stockAdditional paid-in capitalAccumulated deficitTreasury stock
SharesAmountSharesAmountTotal
Balance as of December 31, 202049,483 $5 $1,598,230 $(1,257,546)1,306 $(28,399)$312,290 
Common stock issued pursuant to stock incentive and employee stock purchase plans132 — 63 — — — 63 
Stock-based compensation— — 5,520 — — — 5,520 
Tax payments from shares withheld for equity awards— — (865)— — — (865)
Net income— — — 27,646 — — 27,646 
Balance as of March 31, 202149,615 $5 $1,602,948 $(1,229,900)1,306 $(28,399)$344,654 
Common stock issued pursuant to stock incentive and employee stock purchase plans347 — 1,989 — — — 1,989 
Stock-based compensation— — 4,720 — — — 4,720 
Tax payments from shares withheld for equity awards— — (464)— — — (464)
Net income— — — 31,608 — — 31,608 
Balance as of June 30, 202149,962 $5 $1,609,193 $(1,198,292)1,306 $(28,399)$382,507 
Common stock issued pursuant to stock incentive and employee stock purchase plans63 — 328 — — — 328 
Stock-based compensation— — 4,387 — — — 4,387 
Tax payments from shares withheld for equity awards— — (284)— — — (284)
Net loss— — — (27,803)— — (27,803)
Balance as of September 30, 202150,025 $5 $1,613,624 $(1,226,095)1,306 $(28,399)$359,135 




See accompanying notes.
Blucora, Inc. | Q3 2022 Form 10-Q 7


BLUCORA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) (In thousands)

 Nine Months Ended September 30,
 20222021
Operating activities:
Net income$52,204 $31,451 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of acquired intangible assets35,131 32,498 
Stock-based compensation17,129 15,499 
Change in the fair value of acquisition-related contingent consideration(5,320)19,500 
Reduction of right-of-use lease assets1,103 2,694 
Deferred income taxes(578)(1,161)
Amortization of debt discount and issuance costs2,084 1,979 
Accretion of lease liabilities1,522 731 
Other non-cash items4,387 1,371 
Changes in operating assets and liabilities, net of acquisitions and disposals:
Accounts receivable, net(3,670)(5,008)
Commissions and advisory fees receivable4,587 1,129 
Prepaid expenses and other current assets160 (549)
Other long-term assets(14,887)(10,898)
Accounts payable(4,412)(358)
Commissions and advisory fees payable(4,137)(500)
Lease liabilities(3,788)(1,047)
Deferred revenue(7,967)(7,523)
Accrued expenses and other current and long-term liabilities(11,632)(5,417)
Net cash provided by operating activities61,916 74,391 
Investing activities:
Purchases of property, equipment, and software(17,154)(21,624)
Asset acquisitions(3,743)(3,823)
Net cash used by investing activities(20,897)(25,447)
Financing activities:
Proceeds from credit facilities, net of debt discount and issuance costs (502)
Payments on credit facilities(35,906)(1,359)
Acquisition-related contingent consideration payments(14,548)(13,150)
Stock repurchases(35,000) 
Proceeds from issuance of stock through employee stock purchase plan2,324 1,845 
Tax payments from shares withheld for equity awards(2,090)(1,613)
Proceeds from stock option exercises481 535 
Net cash used by financing activities(84,739)(14,244)
Net increase (decrease) in cash, cash equivalents, and restricted cash(43,720)34,700 
Cash, cash equivalents, and restricted cash, beginning of period134,824 150,762 
Cash, cash equivalents, and restricted cash, end of period$91,104 $185,462 
Supplemental cash flow information:
Cash paid for income taxes$2,408 $2,864 
Cash paid for interest$23,005 $21,626 







See accompanying notes.
Blucora, Inc. | Q3 2022 Form 10-Q 8


BLUCORA, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1: Description of the Business
Blucora, Inc. (the “Company,” “Blucora,” “we,” “our,” or “us”) operates two primary businesses: the Wealth Management business and the digital Tax Software business.
Wealth Management
Our Wealth Management business consists of the operations of Avantax Wealth Management and Avantax Planning Partners (collectively, the “Wealth Management business” or the “Wealth Management segment”).
Avantax Wealth Management provides tax-focused wealth management solutions for financial professionals, tax professionals, certified public accounting (“CPA”) firms, and their clients. Avantax Wealth Management offers its services through its registered broker-dealer, registered investment advisor (“RIA”), and insurance agency subsidiaries and is a leading U.S. tax-focused independent broker-dealer. Avantax Wealth Management works with a nationwide network of financial professionals that operate as independent contractors. Avantax Wealth Management provides these financial professionals with an integrated platform of technical, practice, compliance, operations, sales, and product support tools that enable them to offer tax-advantaged planning, investing, and wealth management services to their clients.
Avantax Planning Partners is an in-house/employee-based RIA, insurance agency, and wealth management business that partners with CPA firms in order to provide their consumer and small business clients with holistic financial planning and advisory services, as well as retirement plan solutions through Avantax Retirement Plan Services. Avantax Planning Partners formerly operated as Honkamp Krueger Financial Services, Inc. (“HKFS”). We acquired HKFS in July 2020 (the “HKFS Acquisition”) and subsequently rebranded it in order to create tighter brand alignment through one common and recognizable brand. Any reference to Avantax Planning Partners in this Form 10-Q is inclusive of HKFS.
Tax Software
Our Tax Software business consists of the operations of TaxAct, Inc. (“TaxAct,” the “Tax Software business,” or the “Tax Software segment”) and provides digital tax preparation services and ancillary services for consumers, small business owners, and tax professionals through its website www.TaxAct.com and its mobile applications.

Our Tax Software segment is highly seasonal with a significant portion of its annual revenue typically earned in the first two quarters of the fiscal year. During the third and fourth quarters of the fiscal year, the Tax Software segment typically reports losses because revenue from the segment is minimal while core operating expenses continue.
Segments
We have two reportable segments: (1) the Wealth Management segment and (2) the Tax Software segment.
Note 2: Summary of Significant Accounting Policies
Interim Financial Information
The accompanying unaudited condensed consolidated financial statements have been prepared by us under the rules and regulations of the SEC for interim financial reporting. These condensed consolidated financial statements are unaudited and, in management’s opinion, include all adjustments, consisting of normal recurring adjustments and accruals, necessary for a fair presentation of the condensed consolidated financial position, results of operations, and cash flows for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in conformity with accounting principles generally accepted in the United States (GAAP”) have been omitted in accordance with the rules and regulations of the SEC. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2021. Interim results are not necessarily indicative of results for a full year.
Blucora, Inc. | Q3 2022 Form 10-Q 9


A summary of our significant accounting policies is included in Note 2 to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2021. There have been no significant changes in our significant accounting policies since December 31, 2021.
Note 3: Segment Information and Revenue
We have two reportable segments: (1) the Wealth Management segment and (2) the Tax Software segment. Our Chief Executive Officer is the chief operating decision maker and reviews financial information presented on a disaggregated basis. This information is used for purposes of allocating resources and evaluating financial performance.
We do not allocate certain general and administrative costs (including personnel and overhead costs), stock-based compensation, acquisition and integration costs, depreciation, amortization of acquired intangible assets, or contested proxy, transaction and other legal and consulting costs to the reportable segments. Such amounts are reflected under the heading “Corporate-level activity.” In addition, we do not allocate interest expense and other, net, or income taxes to the reportable segments. We do not report assets or capital expenditures by segment to the chief operating decision maker.
Information on reportable segments currently presented to our chief operating decision maker and a reconciliation to consolidated net income (loss) are presented below (in thousands):
Three Months Ended September 30,Nine Months Ended
September 30,
2022202120222021
Revenue:
Wealth Management$165,032 $169,135 $494,104 $486,021 
Tax Software6,664 5,039 242,028 220,848 
Total revenue171,696 174,174 736,132 706,869 
Operating income (loss):
Wealth Management27,626 19,564 59,920 60,356 
Tax Software(12,517)(13,864)99,372 100,472 
Corporate-level activity(28,927)(25,982)(77,282)(102,255)
Total operating income (loss)(13,818)(20,282)82,010 58,573 
Interest expense and other, net(9,749)(8,295)(25,707)(24,202)
Income (loss) before income taxes(23,567)(28,577)56,303 34,371 
Income tax benefit (expense)1,726 774 (4,099)(2,920)
Net income (loss)$(21,841)$(27,803)$52,204 $31,451 
Blucora, Inc. | Q3 2022 Form 10-Q 10


Wealth Management Revenue Recognition
Wealth management revenue primarily consists of advisory revenue, commission revenue, asset-based revenue, and transaction and fee revenue.
Revenues by major category within the Wealth Management segment and the timing of Wealth Management revenue recognition was as follows (in thousands):
Three Months Ended September 30,Nine Months Ended
September 30,
2022202120222021
Recognized upon transaction:
Commission$17,868 $22,372 $56,373 $65,815 
Transaction and fee1,307 1,213 3,813 3,779 
Total revenue recognized upon transaction$19,175 $23,585 $60,186 $69,594 
Recognized over time:
Advisory$95,070 $103,540 $306,394 $291,167 
Commission23,920 30,589 75,905 91,382 
Asset-based21,147 5,659 33,774 16,514 
Transaction and fee5,720 5,762 17,845 17,364 
Total revenue recognized over time$145,857 $145,550 $433,918 $416,427 
Total Wealth Management revenue:
Advisory$95,070 $103,540 $306,394 $291,167 
Commission41,788 52,961 132,278 157,197 
Asset-based21,147 5,659 33,774 16,514 
Transaction and fee7,027 6,975 21,658 21,143 
Total Wealth Management revenue$165,032 $169,135 $494,104 $486,021 
Tax Software Revenue Recognition
We generate Tax Software revenue from the sale of digital tax preparation services, packaged tax preparation software, ancillary services, and multiple element arrangements that may include a combination of these items.
Revenues by major category within the Tax Software segment and the timing of Tax Software revenue recognition was as follows (in thousands):
Three Months Ended September 30,Nine Months Ended
September 30,
2022202120222021
Recognized upon transaction:
Consumer$5,974 $4,479 $222,198 $203,891 
Professional525 370 16,473 14,626 
Total revenue recognized upon transaction$6,499 $4,849 $238,671 $218,517 
Recognized over time:
Consumer$ $ $64 $ 
Professional165 190 3,293 2,331 
Total revenue recognized over time$165 $190 $3,357 $2,331 
Total Tax Software revenue:
Consumer$5,974 $4,479 $222,262 $203,891 
Professional690 560 19,766 16,957 
Total Tax Software revenue$6,664 $5,039 $242,028 $220,848 
Note 4: Asset Acquisitions
During the nine months ended September 30, 2022, we completed acquisitions in our Wealth Management business that met the criteria to be accounted for as asset acquisitions. Total initial purchase consideration,
Blucora, Inc. | Q3 2022 Form 10-Q 11


including acquisition costs and fixed deferred payments, was $4.1 million. This purchase consideration was allocated to the acquired assets, primarily customer relationship intangibles. Customer relationship intangibles are amortized on a straight-line basis over an amortization period of 15 years.
We are subject to variable contingent consideration payments related to our asset acquisitions that are not recognized as a liability on our condensed consolidated balance sheets until all contingencies related to the achievement of future financial targets are resolved and the consideration is payable. As of September 30, 2022, the maximum future fixed and contingent payments associated with all prior asset acquisitions were $23.7 million, with specified payment dates from 2022 through 2026.
During the three months ended September 30, 2022, variable contingent consideration related to prior asset acquisitions became payable for approximately $1.5 million, which is included within the $23.7 million discussed above. This accrued consideration is within customer relationship intangibles and is expected to be paid during the fourth quarter of 2022.
Note 5: Debt
Our debt consisted of the following as of the periods indicated in the table below (in thousands):
September 30,
2022
December 31,
2021
Senior Secured Credit Facility
Principal outstanding$525,438 $561,344 
Unamortized debt issuance costs(2,289)(3,371)
Unamortized debt discount(2,055)(3,027)
Net carrying value$521,094 $554,946 
In May 2017, we entered into a credit agreement (as the same has been amended, the “Credit Agreement”) with a syndicate of lenders that provides for a term loan facility (the “Term Loan”) and a revolving line of credit (including a letter of credit sub-facility) (the “Revolver”) for working capital, capital expenditures, and general business purposes (as amended, the “Senior Secured Credit Facility”). The Term Loan has a maturity date of May 22, 2024 (the “Term Loan Maturity Date”). On April 26, 2021, to ensure adequate liquidity and flexibility to support the Company’s growth, we entered into Amendment No. 5 to the Credit Agreement (the “Credit Agreement Amendment”). Pursuant to the Credit Agreement Amendment, the Credit Agreement was amended to, among other things, refinance the existing $65.0 million Revolver and add $25.0 million of additional revolving credit commitments, for an aggregate principal amount of $90.0 million in revolving credit commitments (the “New Revolver”). The New Revolver has a maturity date of February 21, 2024 (the “New Revolver Maturity Date”).
The Company capitalized approximately $0.5 million of debt issuance costs paid in connection with the Credit Agreement Amendment, which are included in other long-term assets on the Company’s condensed consolidated balance sheets as part of the total deferred financing costs associated with the New Revolver.
As of September 30, 2022, we had $525.4 million in principal amount outstanding under the Term Loan and no amounts outstanding under the New Revolver. Based on aggregate loan commitments as of September 30, 2022, approximately $90.0 million was available for future borrowings under the Senior Secured Credit Facility, subject to customary terms and conditions.
The Company is required to make mandatory annual prepayments on the Term Loan in certain circumstances, including in the event that the Company generates Excess Cash Flow (as defined in the Credit Agreement) in a given fiscal year. The Credit Agreement permits the Company to voluntarily prepay the Term Loan without premium or penalty. In addition, the Company is required to make principal amortization payments on the Term Loan quarterly on the last business day of each March, June, September, and December, in an amount equal to approximately $0.5 million (subject to reduction for prepayments), with the remaining principal amount of the Term Loan due on the Term Loan Maturity Date. On August 5, 2022, and as provided for within our Senior Secured Credit Facility, we voluntarily prepaid $35.0 million of principal outstanding under our Term Loan. At our election, this prepayment was first applied to the remaining quarterly principal amortization payments due on the Term Loan, with the remaining amount applied to the principal amount due at the Term Loan Maturity Date. In connection with this prepayment, we recorded a $0.2 million loss on extinguishment of debt for the proportionate amount of unamortized debt issuance costs and debt discount associated with the principal repaid. This loss is included within “Interest expense and other, net” of the condensed consolidated statements of operations.
Blucora, Inc. | Q3 2022 Form 10-Q 12


The interest rate on the Term Loan is variable at the London Interbank Offered Rate (subject to a floor of 1.0%), plus the applicable interest rate margin of 4.0% for Eurodollar Rate Loans (as defined in the Credit Agreement) and 3.0% for ABR Loans (as defined in the Credit Agreement). As of September 30, 2022, the applicable interest rate on the Term Loan was 6.3%. Depending on the Consolidated First Lien Net Leverage Ratio (as defined in the Credit Agreement), the applicable interest rate margin on the New Revolver ranges from 2.0% to 2.5% for Eurodollar Rate Loans and 1.0% to 1.5% for ABR Loans. The Company is required to pay a commitment fee on the undrawn commitment under the New Revolver in a percentage that is dependent on the Consolidated First Lien Net Leverage Ratio that ranges from 0.35% to 0.4%. Interest is payable at the end of each interest period, typically quarterly.
Obligations under the Senior Secured Credit Facility are guaranteed by certain of the Company’s subsidiaries and secured by substantially all the assets of the Company and certain of its subsidiaries (including certain subsidiaries acquired in the acquisition of Avantax Planning Partners and certain other material subsidiaries). The Senior Secured Credit Facility includes financial and operating covenants (including a Consolidated Total Net Leverage Ratio), which are set forth in detail in the Credit Agreement.
Pursuant to the Credit Agreement Amendment, if the Company’s usage of the New Revolver exceeds 30% of the aggregate commitments under the New Revolver on the last day of any calendar quarter, the Company shall not permit the Consolidated Total Net Leverage Ratio (as defined in the Credit Agreement) to exceed (i) 4.75 to 1.00 for the period beginning on April 1, 2021 and ending on December 31, 2021, (ii) 4.25 to 1.00 for the period beginning on January 1, 2022 and ending on September 30, 2022, (iii) 4.00 to 1.00 for the period beginning on October 1, 2022 and ending on December 31, 2022, and (iv) 3.50 to 1.00 for the period beginning on January 1, 2023 and ending on February 21, 2024.
Except as described above, the New Revolver has substantially the same terms as the previous Revolver, including certain covenants and events of default. The Company was in compliance with the debt covenants of the Senior Secured Credit Facility as of September 30, 2022.
Note 6: Leases
Our leases are primarily related to office space and are classified as operating leases. Operating lease cost, net of sublease income, is recognized in “General and administrative” expense for those net costs related to leases used in our operations and within “Acquisition and integration” expense for those net costs related to an unoccupied lease assumed in a previous acquisition on the condensed consolidated statements of operations.
Operating lease cost, net of sublease income, and cash paid on operating lease liabilities for the three and nine months ended September 30, 2022 and 2021 were as follows (in thousands):
Three Months Ended September 30,Nine Months Ended
September 30,
2022202120222021
Fixed lease cost$965 $1,001 $2,885 $3,254 
Variable lease cost258 462 1,023 707 
Operating lease cost, before sublease income1,223 1,463 3,908 3,961 
Sublease income(235)(116)(703)(348)
Total operating lease cost, net of sublease income$988 $1,347 $3,205 $3,613 
Additional lease information:
Cash paid on operating lease liabilities$1,297 $602 $3,788 $1,047 
Lease liabilities obtained from new right-of-use assets$262 $ $390 $93 
Blucora, Inc. | Q3 2022 Form 10-Q 13


Right-of-use assets and operating lease liabilities were recorded on the condensed consolidated balance sheets as follows (in thousands):
September 30, 2022December 31, 2021
Right-of-use assets, net$19,753 $20,466 
Current lease liabilities$5,112 $4,896 
Long-term lease liabilities31,176 33,267 
Total operating lease liabilities$36,288 $38,163 
Weighted-average remaining lease term (in years)9.710.3
Weighted-average discount rate5.4 %5.4 %
The maturities of our operating lease liabilities as of September 30, 2022 were as follows (in thousands):
Undiscounted cash flows:
Remainder of 2022$1,307 
20235,289 
20245,184 
20255,086 
20264,256 
Thereafter26,172 
Total undiscounted cash flows47,294 
Imputed interest(11,006)
Present value of cash flows$36,288 
Note 7: Balance Sheet Components
Prepaid expenses and other current assets consisted of the following (in thousands):
September 30, 2022December 31, 2021
Prepaid expenses$10,640 $13,138 
Forgivable loans5,670 4,316 
Other current assets3,360 1,022 
Total prepaid expenses and other current assets$19,670 $18,476 
Accrued expenses and other current liabilities consisted of the following (in thousands):
September 30, 2022December 31, 2021
Salaries and related benefit expenses$20,446 $26,417 
HKFS Contingent Consideration liability (1)
 28,300 
Accrued legal costs996 2,871 
Accrued vendor and advertising costs4,812 3,777 
Accrued taxes2,785  
Accrued fixed and variable acquisition consideration2,414 837 
Other2,495 3,476 
Total accrued expenses and other current liabilities$