STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

Non-cash compensation related to equity awards is included in the following line items in the accompanying consolidated statements of operations and comprehensive income (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost of revenue	$	66	$	417	$	311	$	1,252
Selling and marketing expense	1,127		2,198		4,207		6,522
General and administrative expense	5,828		11,212		19,721		32,685
Product development	1,571		1,748		4,760		6,448
Restructuring and severance	1,262		—		2,328		1,083
Total non-cash compensation	$	9,854	$	15,575	$	31,327	$	47,990

Stock Options

A summary of changes in outstanding stock options is as follows:


	Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value(a)
		(per option)		(in years)	(in thousands)
Options outstanding at January 1, 2023	805,079	$	155.10
Granted	—	—
Exercised	—	—
Forfeited	(14,833)	124.26
Expired	(51,042)	227.94
Options outstanding at September 30, 2023	739,204	150.69		4.02	$	—
Options exercisable at September 30, 2023	579,316	$	129.61	3.05	$	—

(a)The aggregate intrinsic value represents the total pre-tax intrinsic value (the difference between the Company's closing stock price of $15.50 on the last trading day of the quarter ended September 30, 2023 and the exercise price, multiplied by the number of shares covered by in-the-money options) that would have been received by the option holder had the option holder exercised these options on September 30, 2023. The intrinsic value changes based on the market value of the Company's common stock.

Stock Options with Market Conditions

A summary of changes in outstanding stock options with market conditions at target is as follows:


	Number of Options with Market Conditions	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value(a)
		(per option)		(in years)	(in thousands)
Options outstanding at January 1, 2023	734,685	$	230.79
Granted	—	—
Exercised	—	—
Forfeited	—	—
Expired	(16,247)	308.96
Options outstanding at September 30, 2023	718,438	229.02		4.93	$	—
Options exercisable at September 30, 2023	481,669	$	195.10	3.85	$	—

As of September 30, 2023, a maximum of 395,404 shares may be earned for achieving superior performance up to 167% of the remaining unvested target number of shares. As of September 30, 2023, no additional performance-based nonqualified stock options with a market condition had been earned.

Restricted Stock Units

A summary of changes in outstanding nonvested restricted stock units (“RSUs”) is as follows:


	RSUs
	Number of Units	Weighted Average Grant Date Fair Value
		(per unit)
Nonvested at January 1, 2023	485,053	$	127.46
Granted	390,338	31.74
Vested	(228,262)	131.92
Forfeited	(138,290)	72.31
Nonvested at September 30, 2023	508,839	$	67.03

Restricted Stock Units with Performance Conditions

A summary of changes in outstanding nonvested RSUs with performance conditions is as follows:


	RSUs with Performance Conditions
	Number of Units	Weighted Average Grant Date Fair Value
		(per unit)
Nonvested at January 1, 2023	16,000	$	83.25
Granted	—	—
Vested	—	—
Forfeited	(16,000)	83.25
Nonvested at September 30, 2023	—	$	—

Employee Stock Purchase Plan

In 2021, the Company implemented an employee stock purchase plan (“ESPP”), under which a total of 262,731 shares of the Company's common stock were reserved for issuance. As of September 30, 2023, 190,277 shares of common stock were available for issuance under the ESPP. The ESPP is a tax-qualified plan under Section 423 of the Internal Revenue Code. Under the terms of the ESPP, eligible employees are granted options to purchase shares of the Company's common stock at 85% of the lesser of (1) the fair market value at time of grant or (2) the fair market value at time of exercise. The offering periods and purchase periods are typically six-month periods ending on June 30 and December 31 of each year. During the nine months ended September 30, 2023, 36,536 shares were issued under the ESPP.

During the nine months ended September 30, 2023 and 2022, the Company granted employee stock purchase rights to certain employees with a grant date fair value per share of $8.53 and $20.96, respectively, calculated using the Black-Scholes option pricing model. For purposes of determining stock-based compensation expense, the grant date fair value per share estimated using the Black-Scholes option pricing model required the use of the following key assumptions:


	Nine Months Ended September 30,
	2023		2022
Expected term (1)	0.50 years		0.50 years
Expected dividend (2)	—		—
Expected volatility (3)	82	%	49 - 73%
Risk-free interest rate (4)	4.76 - 5.50%		0.19 - 2.51%

(1)The expected term was calculated using the time period between the grant date and the purchase date.

(2)No dividends are expected to be paid, resulting in a zero expected dividend rate.

(3)The expected volatility rate is based on the historical volatility of the Company's common stock.

(4)The risk-free interest rate is specific to the date of grant. The risk-free interest rate is based on U.S. Treasury yields for notes with comparable expected terms as the employee stock purchase rights, in effect at the grant date.