Restructuring and Reorganization Charges

9 Months Ended

Sep. 30, 2022

Restructuring and Related Activities [Abstract]

Restructuring and Reorganization Charges

6. RESTRUCTURING AND REORGANIZATION CHARGES

During the third quarters of 2022 and 2021, we recorded restructuring and reorganization charges of $14.2 million and $0.2 million, respectively, and for the nine months ended September 30, 2022 and 2021, we recorded restructuring and reorganization charges of $46.3 million and $3.0 million, respectively.

During the nine months ended September 30, 2022 we implemented the following restructuring and reorganizational activities:

•In connection with our workplace of the future philosophy, we consolidated space at thirteen of our leased real estate locations in Australia, India, Sweden, and the U.S., resulting in restructuring charges of $23.0 million related to the impairments of operating lease right-of-use assets, furniture and fixtures, and leasehold improvements, and $4.1 million of accelerated depreciation.

•In June 2022, our management team, with the support of our Board, decided to dissolve the MobileCard business, in which we had acquired a controlling interest in July of 2021 (see Note 5). MobileCard was not meeting its projected targets. As a result, we recorded net impairment charges of $7.0 million, to include the write-offs of the remaining acquired intangible assets, goodwill, and the noncontrolling interest. We also terminated approximately 40 employees, which resulted in restructuring charges related to involuntary terminations of $0.6 million.

•We reduced our workforce by approximately 80 employees, mainly in North America, as a result of organizational changes and efficiencies, to include a margin improvement initiative that began in the second quarter of 2022. As a result, we incurred restructuring charges related to involuntary terminations of $7.0 million.

The activity in the restructuring and reorganization reserves during the nine months ended September 30, 2022 was as follows (in thousands):

	Termination
	Benefits			Other			Total
January 1, 2022, balance	$	675		$	-		$	675
Charged to expense during period		7,604			38,700			46,304
Cash payments		(5,024	)		(4,578	)		(9,602	)
Adjustment for asset impairment		-			(29,986	)		(29,986	)
Adjustment for accelerated depreciation		-			(4,136	)		(4,136	)
Other		788			-			788
September 30, 2022, balance	$	4,043		$	-		$	4,043

As of September 30, 2022, $3.9 million of the restructuring and reorganization reserves were included in current liabilities.