Balance Sheet Details

9 Months Ended

Sep. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Property and equipment, net

Property and equipment, net consisted of the following:



	September 30, 2023		December 31, 2022
Computers and equipment	$	613,305	$	564,763
Furniture and fixtures	1,511		1,511
Leasehold improvements	6,820		6,820
Internal-use software	82,377		78,649
Equipment under finance leases(1)	11,922		—
Property and equipment, gross	$	715,935	$	651,743

Less: accumulated depreciation(1)	$	(363,141)	$	(317,329)
Less: accumulated amortization	(67,988)		(61,244)
Property and equipment, net	$	284,806	$	273,170

___________________

(1)As part of the Paperspace acquisition on July 5, 2023, the Company recognized finance leases for data center equipment for which it is reasonably certain that the Company will exercise, or the Company will substantially utilize, the assets over the estimated lives. Amortization expense of finance lease ROU assets is recognized on a straight-line basis over the lease term of one to five years, and interest expense for finance lease liabilities is recognized under the effective interest rate method based on the incremental borrowing rate. The Company includes the amortization of assets that are recorded under finance leases in depreciation expense included in Cost of revenue on the Company’s Condensed Consolidated Statements of Operations. Interest expense is included in Other income (expense), net on the Company’s Condensed Consolidated Statements of Operations. As of September 30, 2023, finance lease ROU assets, net of amortization, of $10,598 are included in Property and equipment, net; finance lease liabilities of $5,277 and $5,861 are included in Other current liabilities and Other non-current liabilities, respectively, on the Company’s Condensed Consolidated Balance Sheets.

Depreciation expense on property and equipment for the three months ended September 30, 2023 and 2022 was $22,912 and $20,982, respectively, and $66,956 and $62,009 for the nine months ended September 30, 2023 and 2022, respectively.

The Company capitalized costs related to the development of computer software for internal use of $5,070 and $7,879 for the nine months ended September 30, 2023 and 2022, respectively, which is included in internal-use software costs within Property and equipment, net. Amortization expense related to internal-use software for the three months ended September 30, 2023 and 2022 was $1,991 and $2,983, respectively, and $6,898 and $9,205 for the nine months ended September 30, 2023 and 2022, respectively.