10-Q 1 gddy-20220331.htm 10-Q gddy-20220331
000160971112/312022Q1FALSE
Costs and operating expenses include equity-based compensation expense as follows:
Three months ended
 March 31,
20222021
Cost of revenue$0.3 $0.2 
Technology and development32.9 27.0 
Marketing and advertising7.0 6.2 
Customer care4.2 3.0 
General and administrative16.8 16.2 
Total equity-based compensation expense$61.2 $52.6 
Components of OCI are net of the tax effects reflected below:
Unrealized swap gain (loss), net(2.5)0.5 
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 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: 001-36904
GoDaddy Inc.
(Exact name of registrant as specified in its charter)
Delaware46-5769934
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification Number)
2155 E. GoDaddy Way
Tempe, Arizona 85284
(Address of principal executive offices, including zip code)
(480) 505-8800
(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
Class A Common Stock, $0.001 par value per shareGDDYNYSE
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.    Yes    ☒    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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).                    Yes    ☒    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
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller 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    ☐    No    ☒
As of April 29, 2022, there were 161,752,747 shares of GoDaddy Inc.'s Class A common stock, $0.001 par value per share, outstanding and 312,223 shares of GoDaddy Inc.'s Class B common stock, $0.001 par value per share, outstanding.



GoDaddy Inc.
Quarterly Report on Form 10-Q
For the Quarterly Period Ended March 31, 2022

TABLE OF CONTENTS

i

NOTE ABOUT FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including the sections titled "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Risk Factors," contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, involving substantial risks and uncertainties. The words "believe," "may," "will," "potentially," "plan," "could," "should," "predict," "ongoing," "estimate," "continue," "anticipate," "intend," "project," "expect," "seek," or the negative of these words, or terms or similar expressions conveying uncertainty of future events or outcomes, or that concern our expectations, strategy, plans or intentions, are intended to identify forward-looking statements. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected, anticipated, or expected. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements discussed under the heading "Risk Factors" and in our publicly available filings and press releases. These statements include, among other things, those regarding:
•our ability to continue to add new customers and increase sales to our existing customers;
•our ability to develop new solutions and bring them to market in a timely manner;
•our ability to timely and effectively scale and adapt our existing solutions;
•our dependence on establishing and maintaining a strong brand;
•the occurrence of service interruptions and security or privacy breaches and related remediation efforts and fines;
•system failures or capacity constraints;
•the rate of growth of, and anticipated trends and challenges in, our business and in the market for our products;
•our future financial performance, including our expectations regarding our revenue, cost of revenue, operating expenses, including changes in technology and development, marketing and advertising, general and administrative and customer care expenses, and our ability to achieve and maintain future profitability;
•our ability to continue to efficiently acquire customers, maintain our high customer retention rates and maintain the level of our customers' lifetime spend;
•our ability to provide high quality customer care;
•the effects of increased competition in our markets and our ability to compete effectively;
•our ability to grow internationally;
•the impact of fluctuations in foreign currency exchange rates on our business and our ability to effectively manage the exposure to such fluctuations;
•our ability to effectively manage our growth and associated investments, including our migration of the vast majority of our infrastructure to the public cloud;
•our ability to integrate acquisitions, including our recent acquisitions of Poynt Co. (now known as GoDaddy Payments) and Pagely, our entry into new lines of business and our ability to achieve expected results from our integrations and new lines of business;
•our ability to maintain our relationships with our partners;
•adverse consequences of our substantial level of indebtedness and our ability to repay our debt;
•our ability to maintain, protect and enhance our intellectual property;
•our ability to maintain or improve our market share;
•sufficiency of cash and cash equivalents to meet our needs for at least the next 12 months;
•beliefs and objectives for future operations;
•our ability to stay in compliance with laws and regulations currently applicable to, or which may become applicable to, our business both in the United States (U.S.) and internationally;
•economic and industry trends or trend analysis;
•our ability to attract and retain qualified employees and key personnel;
ii

NOTE ABOUT FORWARD-LOOKING STATEMENTS (continued)

•anticipated income tax rates, tax estimates and tax standards;
•interest rate changes;
•the future trading prices of our Class A common stock;
•our expectations regarding the outcome of any regulatory investigation or litigation;
•the amount and timing of future repurchases of our Class A common stock under any share repurchase program;
•the potential impact of shareholder activism on our business and operations;
•the length and severity of the coronavirus (COVID-19) pandemic and its impact on our business, customers and employees;
as well as other statements regarding our future operations, financial condition, growth prospects and business strategies.
We operate in very competitive and rapidly-changing environments, and new risks emerge from time-to-time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this report may not occur, and actual results could differ materially and adversely from those implied in our forward-looking statements.
You should not rely upon forward-looking statements as predictions of future events. Although we believe the expectations reflected in our forward-looking statements are reasonable, we cannot guarantee the future results, levels of activity, performance or events and circumstances described in the forward-looking statements will be achieved or occur. Neither we, nor any other person, assume responsibility for the accuracy and completeness of the forward-looking statements. We undertake no obligation to publicly update any forward-looking statements for any reason after the date of this report to conform such statements to actual results or to changes in our expectations, except as required by law. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.
Unless expressly indicated or the context suggests otherwise, references to "GoDaddy," "company," "we," "us" and "our" refer to GoDaddy Inc. and its consolidated subsidiaries, including Desert Newco, LLC and its subsidiaries (Desert Newco).
iii
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements
GoDaddy Inc.
Consolidated Balance Sheets (unaudited)
(In millions, except shares in thousands and per share amounts)
March 31,December 31,
 20222021
Assets
Current assets:
Cash and cash equivalents$742.7 $1,255.7 
Accounts and other receivables59.7 63.6 
Prepaid domain name registry fees433.3 419.7 
Prepaid expenses and other current assets208.0 150.8 
Total current assets1,443.7 1,889.8 
Property and equipment, net222.6 220.0 
Operating lease assets100.8 109.2 
Prepaid domain name registry fees, net of current portion186.8 181.4 
Goodwill3,514.4 3,540.8 
Intangible assets, net1,343.8 1,384.7 
Other assets89.2 91.2 
Total assets$6,901.3 $7,417.1 
Liabilities and stockholders' equity (deficit)
Current liabilities:
Accounts payable$114.2 $85.2 
Accrued expenses and other current liabilities374.1 437.3 
Deferred revenue1,961.6 1,890.1 
Long-term debt24.1 24.1 
Total current liabilities2,474.0 2,436.7 
Deferred revenue, net of current portion763.7 743.3 
Long-term debt, net of current portion3,852.8 3,858.2 
Operating lease liabilities, net of current portion136.5 142.7 
Other long-term liabilities74.7 77.7 
Deferred tax liabilities68.3 75.3 
Commitments and contingencies
Stockholders' equity (deficit):
Preferred stock, $0.001 par value - 50,000 shares authorized; none issued and outstanding
— — 
Class A common stock, $0.001 par value - 1,000,000 shares authorized; 161,686 and 166,901 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively
0.2 0.2 
Class B common stock, $0.001 par value - 500,000 shares authorized; 312 and 320 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively
— — 
Additional paid-in capital1,665.6 1,594.7 
Accumulated deficit(2,156.4)(1,474.6)
Accumulated other comprehensive income (loss)20.1 (38.6)
Total stockholders' equity (deficit) attributable to GoDaddy Inc.(470.5)81.7 
Non-controlling interests1.8 1.5 
Total stockholders' equity (deficit)(468.7)83.2 
Total liabilities and stockholders' equity (deficit)$6,901.3 $7,417.1 
See accompanying notes to consolidated financial statements.
1
GoDaddy Inc.
Consolidated Statements of Operations (unaudited)
(In millions, except shares in thousands and per share amounts)

Three Months Ended
March 31,
20222021
Revenue:
Applications & commerce$303.1 $262.0 
Core platform699.6 639.1 
Total revenue1,002.7 901.1 
Costs and operating expenses(1):
Cost of revenue (excluding depreciation and amortization)370.2 321.2 
Technology and development190.1 186.4 
Marketing and advertising116.3 132.7 
Customer care77.7 78.6 
General and administrative90.6 95.2 
Depreciation and amortization48.2 49.0 
Total costs and operating expenses893.1 863.1 
Operating income109.6 38.0 
Interest expense(33.6)(28.7)
Other income (expense), net(1.1)0.7 
Income before income taxes74.9 10.0 
Benefit (provision) for income taxes(6.3)0.8 
Net income 68.6 10.8 
Less: net income attributable to non-controlling interests0.2 — 
Net income attributable to GoDaddy Inc. $68.4 $10.8 
Net income attributable to GoDaddy Inc. per share of Class A common stock:
Basic$0.42 $0.06 
Diluted$0.41 $0.06 
Weighted-average shares of Class A common stock outstanding:
Basic164,323 169,435 
Diluted166,811 173,053 
___________________________
(1) Costs and operating expenses include equity-based compensation expense as follows:
Cost of revenue$0.3 $0.2 
Technology and development32.9 27.0 
Marketing and advertising7.0 6.2 
Customer care4.2 3.0 
General and administrative16.8 16.2 
Total equity-based compensation expense$61.2 $52.6 
See accompanying notes to consolidated financial statements.
2
GoDaddy Inc.
Consolidated Statements of Comprehensive Income (unaudited)
(In millions)

Three Months Ended
March 31,
20222021
Net income$68.6 $10.8 
Foreign exchange forward contracts gain (loss), net3.2 2.1 
Unrealized swap gain (loss), net(1)
89.9 24.4 
Change in foreign currency translation adjustment(34.3)33.7 
Comprehensive income127.4 71.0 
Less: comprehensive income attributable to non-controlling interests0.3 0.3 
Comprehensive income attributable to GoDaddy Inc.$127.1 $70.7 
___________________________
(1) Components of OCI are net of the tax effects reflected below:
Unrealized swap gain (loss), net$(2.5)$0.5 
See accompanying notes to consolidated financial statements.
3
GoDaddy Inc.
Consolidated Statements of Stockholders' Deficit (unaudited)
(In millions, except shares in thousands)

Class A Common StockClass B Common StockAdditional
Paid-in
Capital		Accumulated DeficitAccumulated Other Comprehensive Income (Loss)Non-
Controlling
Interests		Total
SharesAmountSharesAmount
Balance at December 31, 2021166,901 $0.2 320 $— $1,594.7 $(1,474.6)$(38.6)$1.5 $83.2 
Net income — — — — — 68.4 — 0.2 68.6 
Equity-based compensation, including amounts capitalized— — — — 62.2 — — — 62.2 
Stock option exercises202 — — — 8.5 — — — 8.5 
Repurchases of Class A common stock(6,532)— — — — (750.2)— — (750.2)
Impact of derivatives, net— — — — — — 93.1 — 93.1 
Change in foreign currency translation adjustment— — — — — — (34.3)— (34.3)
Vesting of restricted stock units and other1,115 — (8)— 0.2 — (0.1)0.1 0.2 
Balance at March 31, 2022161,686 $0.2 312 $— $1,665.6 $(2,156.4)$20.1 $1.8 $(468.7)
Class A Common StockClass B Common StockAdditional
Paid-in
Capital		Accumulated DeficitAccumulated Other Comprehensive LossNon-
Controlling
Interests		Total
SharesAmountSharesAmount
Balance at December 31, 2020169,157 $0.2 688 $— $1,308.8 $(1,190.9)$(131.0)$1.1 $(11.8)
Net income — — — — — 10.8 — — 10.8 
Equity-based compensation, including amounts capitalized— — — — 53.2 — — — 53.2 
Stock option exercises309 — — — 11.8 — — (0.2)11.6 
Repurchases of Class A common stock(2,544)— — — — (195.1)— — (195.1)
Impact of derivatives, net— — — — — — 26.5 — 26.5 
Change in foreign currency translation adjustment— — — — — — 33.7 — 33.7 
Vesting of restricted stock units and other1,523 — (209)— (0.4)— (0.4)0.9 0.1 
Balance at March 31, 2021168,445 $0.2 479 $— $1,373.4 $(1,375.2)$(71.2)$1.8 $(71.0)
See accompanying notes to consolidated financial statements.
4
GoDaddy Inc.
Consolidated Statements of Cash Flows (unaudited)
(In millions)
 
Three Months Ended
March 31,
 20222021
Operating activities
Net income$68.6 $10.8 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization48.2 49.0 
Equity-based compensation expense61.2 52.6 
Other17.6 6.4 
Changes in operating assets and liabilities, net of amounts acquired:
Prepaid domain name registry fees(19.8)(28.3)
Deferred revenue94.6 127.1 
Other operating assets and liabilities(19.5)3.7 
Net cash provided by operating activities250.9 221.3 
Investing activities
Business acquisitions, net of cash acquired— (298.5)
Purchases of property and equipment(12.3)(9.0)
Other investing activities(0.2)1.0 
Net cash used in investing activities(12.5)(306.5)
Financing activities
Proceeds received from:
Issuance of senior notes— 800.0 
Stock option exercises8.5 11.6 
Payments made for:
Repurchases of Class A common stock(750.1)(180.1)
Repayment of term loans(8.1)(8.1)
Other financing obligations(0.9)(9.7)
Net cash provided by (used in) financing activities(750.6)613.7 
Effect of exchange rate changes on cash and cash equivalents(0.8)(0.6)
Net increase (decrease) in cash and cash equivalents(513.0)527.9 
Cash and cash equivalents, beginning of period1,255.7 765.2 
Cash and cash equivalents, end of period$742.7 $1,293.1 
Cash paid during the period for:
Interest on long-term debt, including impact of interest rate swaps$28.1 $15.0 
Income taxes, net of refunds received$4.5 $1.2 
Amounts included in the measurement of operating lease liabilities$13.7 $12.7 
Supplemental disclosure of non-cash transactions
Operating lease assets obtained in exchange for operating lease liabilities$3.0 $2.6 
Accrued purchases of property and equipment at period end$5.9 $2.3 
Share repurchases not yet settled$— $15.0 
See accompanying notes to consolidated financial statements.
5
GoDaddy Inc.
Notes to Consolidated Financial Statements (unaudited)
(In millions, except shares in thousands and per share amounts)

1.    Organization and Background
Organization
We are the sole managing member of Desert Newco, and as a result, we consolidate its financial results and report non-controlling interests representing the economic interests held by other members. The calculation of non-controlling interests excludes any net income attributable directly to GoDaddy Inc. As of March 31, 2022, we owned more than 99.8% of Desert Newco.
Basis of Presentation
Our financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP) and include our accounts and the accounts of our subsidiaries. All material intercompany accounts and transactions have been eliminated.
Our interim financial statements are unaudited, and in our opinion, include all adjustments of a normal recurring nature necessary for the fair presentation of the periods presented. The results for interim periods are not necessarily indicative of the results to be expected for any subsequent period or for the year ending December 31, 2022.
These financial statements should be read in conjunction with our audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2021 (the 2021 Form 10-K).
Prior Period Reclassifications
In the first quarter of 2022, we revised the presentation of revenue in our statements of operations, as described in Note 2. Reclassifications of certain other immaterial prior period amounts have been made to conform to the current period presentation.
Use of Estimates
GAAP requires us to make estimates and assumptions affecting amounts reported in our financial statements. We periodically evaluate our estimates and adjust prospectively, if necessary. We believe our estimates and assumptions are reasonable; however, actual results may differ.
6
Segments
Beginning in the first quarter of 2022, we revised the presentation of segment information to reflect changes in the way we manage and evaluate our business. As such, we now report our operating results through two reportable segments: Applications and Commerce (A&C) and Core Platform (Core), as further discussed in Note 14. Accordingly, we have revised our segment information for the comparable prior year period.
2.    Summary of Significant Accounting Policies
Property and Equipment
Property and equipment, net by geography was as follows:
 March 31, 2022December 31, 2021
U.S.$164.8 $162.6 
France24.2 23.8 
All other international33.6 33.6 
$222.6 $220.0 
No other international country represented more than 10% of property and equipment, net in any period presented.
Derivative Financial Instruments
We are exposed to changes in foreign currency exchange rates, primarily relating to intercompany debt, the net assets of our foreign operations and sales transactions denominated in currencies other than the U.S. dollar, as well as to changes in interest rates as a result of our variable-rate debt. Consequently, we use derivative financial instruments to manage and mitigate such risks. We do not enter into derivative transactions for speculative or trading purposes.
We utilize a variety of derivative instruments and expect that each derivative instrument qualifying for hedge accounting will be highly effective at reducing the risk associated with the exposure being hedged. For each derivative instrument designated as a hedge, we formally document, at inception, the related risk management strategy and objective, including identification of the hedging instrument, the hedged item and the risk of exposure. In addition, we formally assess, both at the inception and at least quarterly thereafter, whether the financial instruments used in the hedging transactions are effective at offsetting changes in either the fair values or cash flows of the relating underlying exposures.
Our derivative instruments are recorded at fair value on a gross basis. For cash flow reporting purposes, proceeds received or amounts paid upon the settlement of a derivative instrument are classified in the same manner as the related item being hedged.
Cash Flow Hedges
We utilize a variety of derivative instruments designated as cash flow hedges:
•foreign exchange forward contracts to hedge certain forecasted sales transactions denominated in foreign currencies;
•cross-currency swaps used to manage variability due to movements in foreign currency exchange rates related to a Euro-denominated intercompany loan; and
•pay-fixed rate, receive-floating rate interest rate swaps to effectively convert portions of our variable-rate debt to fixed.
We reflect unrealized gains or losses on our cash flow hedges as components of accumulated other comprehensive income (loss) (AOCI). Gains and losses on these instruments are recorded as a component of AOCI until the underlying transaction is recorded in earnings. When the hedged item is realized, gains or losses are reclassified from AOCI to earnings within the same line items as the underlying transactions. At inception, and each reporting period, we evaluate the effectiveness of each of our hedges, and all hedges were determined to be effective.
7
Net Investment Hedges
We use cross-currency swaps to reduce the risk associated with exchange rate fluctuations on our net investments in certain foreign operations. Changes in the fair value of these derivative instruments are recorded in equity as a component of AOCI in the same manner as foreign currency translation adjustments (CTA). We elected to use the spot method to assess effectiveness of these derivatives. Under this method, changes in fair value of the hedging instruments attributed to changes in spot rates are initially recorded in the CTA component of AOCI and will remain there until the hedged net investments are sold or substantially liquidated. Changes in fair value of the hedging instruments other than those due to changes in the spot rate are initially recorded in the CTA component of AOCI and are amortized to interest expense using a systematic and rational method over the instruments’ term.
See Note 9 for further discussion of our derivative instruments.
Revenue Recognition
In the first quarter of 2022, we revised the presentation of revenue in our statements of operations in order to provide better visibility into our business and products as well as a more consistent way to track our progress against our strategic objectives. This change also aligns our revenue presentation with the products in each of our two reportable segments, which are discussed in Note 14. Following this change, our revenue is categorized as follows:
Applications and Commerce. A&C revenue primarily consists of revenue from sales of third-party email and productivity solutions such as Microsoft Office 365, products containing proprietary software such as Websites + Marketing and Managed WordPress and commerce products such as payment processing fees and point-of-sale (POS) hardware. A&C revenue also includes revenue from sales of products, such as website security products, when they are included in bundled offerings of our proprietary software products. Consideration is generally recorded as deferred revenue when received, which is typically at the time of sale, and revenue from most A&C products is recognized ratably over the period in which the performance obligations are satisfied, which is typically over the contract term. Payment processing fee revenue is recognized at the time of the transaction and revenue from the sale of POS hardware is recognized at the time when ownership is transferred to the customer.
Core Platform. Core revenue primarily consists of revenue from sales of domain registrations and renewals, aftermarket domain sales, website hosting products and website security products when not included in bundled offerings of our proprietary software products. Core revenue also includes revenue from sales of products not containing a software component such as professional web services as well as fee surcharges paid to ICANN. Consideration is generally recorded as deferred revenue when received, which is typically at the time of sale, and revenue from most Core products is recognized ratably over the period in which the performance obligations are satisfied, which is typically over the contract term. Aftermarket domain revenue is recognized at the time when ownership of the domain is transferred to the buyer.
8
The prior period statement of operations was revised to retrospectively present revenue in the new groupings as shown in the table below. There was no impact on total revenue, operating income, net income, deferred revenue or our statement of cash flows as a result of these revisions.
Three Months Ended March 31, 2021
As Previously Reported
Revenue:
Domains$422.7 
Hosting and presence310.3 
Business applications168.1 
Total revenue$901.1 
As Revised
Revenue:
Applications and commerce$262.0 
Core platform639.1 
Total revenue$901.1 
Disaggregated Revenue
Revenue by major product type was as follows:
 Three Months Ended March 31,
 20222021
Applications and commerce$303.1 $262.0 
Core platform: domains483.9 424.0 
Core platform: other215.7 215.1 
$1,002.7 $901.1 
No single customer represented over 10% of our total revenue for any period presented.
Revenue by geography is based on the customer's billing address and was as follows:
 Three Months Ended March 31,
 20222021
U.S.$672.9 $598.0 
International329.8 303.1 
$1,002.7 $901.1 
No international country represented more than 10% of total revenue in any period presented.
See Note 6 for information regarding our deferred revenue.
Assets Recognized from Contract Costs
Fees paid to various registries at the inception of a domain registration or renewal represent costs to fulfill a contract. We capitalize and amortize these prepaid domain name registry fees to cost of revenue consistent with the pattern of transfer of the product to which the asset relates. Amortization expense of such asset was $174.1 million and $160.9 million for the three months ended March 31, 2022 and 2021, respectively.
9
Fair Value Measurements
The following tables set forth our material assets and liabilities measured and recorded at fair value on a recurring basis:
March 31, 2022
Level 1Level 2Level 3Total
Assets:
 Cash and cash equivalents:
Money market funds and time deposits$350.1 $— $— $350.1 
 Derivative assets— 72.5 — 72.5 
Total assets$350.1 $72.5 $— $422.6 
Liabilities:
 Derivative liabilities$— $49.8 $— $49.8 
Total liabilities$— $49.8 $— $49.8 
December 31, 2021
Level 1Level 2Level 3Total
Assets:
 Cash and cash equivalents:
Money market funds and time deposits$178.1 $— $— $178.1 
 Derivative assets— 30.3 — 30.3 
Total assets$178.1 $30.3 $— $208.4 
Liabilities:
 Derivative liabilities $— $89.5 $— $89.5 
Total liabilities$— $89.5 $— $89.5 
Recent Accounting Pronouncements
In October 2021, the FASB issued final guidance changing the measurement of acquired liabilities from contracts with customers in a business combination. The new guidance requires the recognition of contract liabilities at amounts generally consistent with those recorded by the acquiree immediately before the acquisition date. Under existing guidance, contract liabilities are measured at fair value, which generally results in a reduction to acquired contract liabilities and therefore lower revenue recognized during the post-acquisition period. We early adopted the new guidance on January 1, 2022, which we will apply to future business acquisitions.
3.    Goodwill and Intangible Assets
As described in Note 14, beginning in the first quarter of 2022, we revised the presentation of segment information to reflect changes in the way we manage and evaluate our business. As such, we now have two operating segments, which are also our reporting units. We evaluated the goodwill of each reporting unit for impairment immediately before and after this change; no impairment was identified.
The following table summarizes changes in our goodwill balance by segment:
A&CCoreTotal
Balance at December 31, 2021$1,522.5 $2,018.3 $3,540.8 
Impact of foreign currency translation(11.4)(15.0)(26.4)
Balance at March 31, 2022$1,511.1 $2,003.3 $3,514.4 
10
Intangible assets, net are summarized as follows:
March 31, 2022
Gross 
Carrying
Amount		Accumulated
Amortization		Net Carrying
Amount
Indefinite-lived intangible assets:
Trade names and branding$445.0 n/a$445.0 
Domain portfolio245.8 n/a245.8 
Contractual-based assets253.8 n/a253.8 
Finite-lived intangible assets:
Customer-related512.7 $(279.8)232.9 
Developed technology236.4 (138.0)98.4 
Trade names and other114.8 (46.9)67.9 
$1,808.5 $(464.7)$1,343.8 
 December 31, 2021
Gross 
Carrying
Amount		Accumulated
Amortization		Net Carrying
Amount
Indefinite-lived intangible assets:
Trade names and branding$445.0 n/a$445.0 
Domain portfolio246.8 n/a246.8 
Contractual-based assets253.8 n/a253.8 
Finite-lived intangible assets:
Customer-related535.1 $(279.3)255.8 
Developed technology243.5 (133.1)110.4 
Trade names and other118.4 (45.5)72.9 
$1,842.6 $(457.9)$1,384.7 
Amortization expense was $33.2 million and $30.4 million for the three months ended March 31, 2022 and 2021, respectively. As of March 31, 2022, the weighted-average remaining amortization period for amortizable intangible assets was 46 months for customer-related, 34 months for developed technology and 62 months for trade names and other, and was 46 months in total.
Based on the balance of finite-lived intangible assets as of March 31, 2022, expected future amortization expense is as follows:
Year Ending December 31:
2022 (remainder of)$97.3 
2023103.8 
202485.0 
202579.1 
202626.1 
Thereafter7.9 
$399.2 
11
4.    Stockholders' Equity
Share Repurchases
In January 2022, our Board approved the repurchase of up to an additional $2,251.0 million of our Class A common stock. Such approval was in addition to the amount remaining available for repurchases under prior Board approvals, such that we have authority to repurchase up to $3,000.0 million of our Class A common stock. Shares may be repurchased in open market purchases, block transactions and privately negotiated transactions, in accordance with applicable federal securities laws. This authorization has no time limits, does not obligate us to make any repurchases and may be modified, suspended or terminated by us at any time without prior notice.
In February 2022, we entered into accelerated share repurchase agreements (ASRs) to repurchase shares of our Class A common stock in exchange for an up-front aggregate payment of $750.0 million. The counterparties to the ASRs initially delivered an aggregate of 6,532 shares, which were immediately retired and the up-front payment was recorded as a charge to accumulated deficit. The ASRs are forward contracts indexed to our Class A common stock and meet all of the applicable criteria for equity classification; therefore, they are not accounted for as derivative instruments. The total number of shares ultimately delivered under the ASRs, and therefore the average repurchase price paid per share, will be determined based on the volume weighted-average price of our stock during the purchase period, which is expected to be completed during the second quarter of 2022. Expenses incurred in connection with the ASRs were recorded as a charge to accumulated deficit.
As of March 31, 2022, we had $2,250.0 million of remaining authorization available for repurchases.
5.    Equity-Based Compensation Plans
Equity Plans
On March 31, 2015, we adopted the 2015 Equity Incentive Plan (the 2015 Plan). On January 1, 2022, an additional 6,689 shares of our Class A common stock were reserved for issuance pursuant to the automatic increase provisions of the 2015 Equity Incentive Plan. As of March 31, 2022, 34,485 shares were available for issuance as future awards under the plan.
On March 31, 2015, we adopted the 2015 Employee Stock Purchase Plan (the ESPP). On January 1, 2022, an additional 1,000 shares of our Class A common stock were reserved for issuance pursuant to the automatic increase provisions of the ESPP. As of March 31, 2022, 5,592 shares were available for issuance under the plan.
Equity Plan Activity
We have granted stock options at exercise prices equal to the fair market value of our Class A common stock on the grant date. We have granted both stock options and restricted stock awards (RSUs) vesting solely upon the continued service of the recipient as well as performance-based awards (PSUs) with vesting based on either (i) our achievement of financial targets or (ii) our relative total stockholder return (TSR) as compared to an index of public internet companies. We recognize the accounting grant date fair value of equity-based awards as compensation expense over the required service period of each award, taking into account the probability of our achievement of associated performance targets. Compensation expense for TSR-based PSUs is recognized regardless of whether the TSR market condition is satisfied.
The following table summarizes stock option activity:
Number of
Shares of Class A Common Stock (#)		Weighted-
Average
Exercise
Price Per Share ($)
Outstanding at December 31, 2021
1,999 42.94 
Exercised(202)42.03 
Forfeited(11)73.02 
Outstanding at March 31, 2022
1,786 42.86 
Vested at March 31, 2022
1,585 39.56 
12
The following table summarizes stock award activity:
Number of
Shares of Class A Common Stock (#)
Outstanding at December 31, 20216,766 
Granted: RSUs3,370 
Granted: TSR-based PSUs246 
Vested(1,107)
Forfeited(284)
Outstanding at March 31, 2022(1)
8,991 
_________________________________
(1)Includes financial-based PSUs for which performance targets have not yet been established, and which are not yet considered granted for accounting purposes. The balance of outstanding awards is comprised of the following:
Number of
Shares of Class A Common Stock (#)		Weighted-Average Grant-Date Fair Value Per Share ($)
RSUs8,162 79.73
TSR-based PSUs757 119.44
Financial-based PSUs granted for accounting purposes47 82.52
Financial-based PSUs not yet granted for accounting purposes25 N/A
Outstanding at March 31, 20228,991 
As of March 31, 2022, total unrecognized compensation expense related to non-vested stock options and stock awards was $4.0 million and $533.6 million, respectively, with expected remaining weighted-average recognition periods of 1.3 years and 2.8 years, respectively. Such amounts exclude PSUs not yet considered granted for accounting purposes.
6.    Deferred Revenue
Deferred revenue consisted of the following:
March 31, 2022December 31, 2021
Current:
A&C$601.8 $