QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
x | Accelerated filer | o | |||||||||
Non-accelerated filer | o | Smaller reporting company | |||||||||
Emerging growth company |
June 30, 2022 | December 31, 2021 | ||||||||||
Assets | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net of allowance for doubtful accounts of $ | |||||||||||
Inventory | |||||||||||
Prepaid expenses and other current assets (Note 10) | |||||||||||
Total current assets | |||||||||||
Noncurrent assets | |||||||||||
Goodwill (Note 4) | |||||||||||
Other intangible assets, net (Note 5) | |||||||||||
Capitalized acquisition costs, net (Note 6) | |||||||||||
Equipment for lease, net (Note 7) | |||||||||||
Property, plant and equipment, net (Note 8) | |||||||||||
Right-of-use assets (Note 13) | |||||||||||
Investments in securities | |||||||||||
Other noncurrent assets | |||||||||||
Total noncurrent assets | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities and Stockholders' Equity | |||||||||||
Current liabilities | |||||||||||
Accounts payable | $ | $ | |||||||||
Accrued expenses and other current liabilities (Note 10) | |||||||||||
Deferred revenue (Note 3) | |||||||||||
Current lease liabilities (Note 13) | |||||||||||
Total current liabilities | |||||||||||
Noncurrent liabilities | |||||||||||
Long-term debt (Note 9) | |||||||||||
Deferred tax liability (Note 12) | |||||||||||
Noncurrent lease liabilities (Note 13) | |||||||||||
Other noncurrent liabilities | |||||||||||
Total noncurrent liabilities | |||||||||||
Total liabilities | |||||||||||
Commitments and contingencies (Note 15) | |||||||||||
Stockholders' equity (Note 16) | |||||||||||
Preferred stock, $ | |||||||||||
Class A common stock, $ | |||||||||||
Class B common stock, $ | |||||||||||
Class C common stock, $ | |||||||||||
Additional paid-in capital | |||||||||||
Treasury stock, at cost; | ( | ( | |||||||||
Accumulated other comprehensive loss | ( | ||||||||||
Retained deficit | ( | ( | |||||||||
Total stockholders' equity attributable to Shift4 Payments, Inc. | |||||||||||
Noncontrolling interests (Note 17) | |||||||||||
Total stockholders' equity | |||||||||||
Total liabilities and stockholders' equity | $ | $ | |||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Gross revenue | $ | $ | $ | $ | |||||||||||||||||||
Cost of sales | |||||||||||||||||||||||
Gross profit | |||||||||||||||||||||||
General and administrative expenses | |||||||||||||||||||||||
Depreciation and amortization expense | |||||||||||||||||||||||
Professional fees | |||||||||||||||||||||||
Advertising and marketing expenses | |||||||||||||||||||||||
Restructuring expenses (Note 10) | |||||||||||||||||||||||
Transaction-related expenses (Note 9) | |||||||||||||||||||||||
Total operating expenses | |||||||||||||||||||||||
Income (loss) from operations | ( | ||||||||||||||||||||||
Loss on extinguishment of debt | ( | ||||||||||||||||||||||
Interest income | |||||||||||||||||||||||
Other income, net | |||||||||||||||||||||||
Interest expense | ( | ( | ( | ( | |||||||||||||||||||
Income (loss) before income taxes | ( | ( | ( | ||||||||||||||||||||
Income tax benefit (provision) (Note 12) | ( | ||||||||||||||||||||||
Net income (loss) | ( | ||||||||||||||||||||||
Net income (loss) attributable to noncontrolling interests | ( | ( | |||||||||||||||||||||
Net income (loss) attributable to Shift4 Payments, Inc. | $ | $ | $ | $ | ( | ||||||||||||||||||
Basic net income (loss) per share: | |||||||||||||||||||||||
Class A net income (loss) per share - basic | $ | $ | $ | $ | ( | ||||||||||||||||||
Class A weighted average common stock outstanding - basic | |||||||||||||||||||||||
Class C net income (loss) per share - basic | $ | $ | $ | $ | ( | ||||||||||||||||||
Class C weighted average common stock outstanding - basic | |||||||||||||||||||||||
Diluted net income (loss) per share: | |||||||||||||||||||||||
Class A net income (loss) per share - diluted | $ | $ | $ | $ | ( | ||||||||||||||||||
Class A weighted average common stock outstanding - diluted | |||||||||||||||||||||||
Class C net income (loss) per share - diluted | $ | $ | $ | $ | ( | ||||||||||||||||||
Class C weighted average common stock outstanding - diluted | |||||||||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | ( | ||||||||||||||||||
Other comprehensive income (loss) | |||||||||||||||||||||||
Unrealized income (loss) on foreign currency translation adjustment, net of tax | ( | ( | |||||||||||||||||||||
Total other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
Comprehensive income (loss) | ( | ||||||||||||||||||||||
Comprehensive income (loss) attributable to noncontrolling interests | ( | ( | |||||||||||||||||||||
Comprehensive income (loss) attributable to Shift4 Payments, Inc. | $ | $ | $ | $ | ( | ||||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Class A Common Stock | Class B Common Stock | Class C Common Stock | Additional Paid-In Capital | Treasury Stock | Retained Deficit | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2021 | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | — | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock and fair value of equity-based compensation awards assumed in connection with The Giving Block acquisition | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchases of Class A common stock to treasury stock | — | — | — | — | — | — | ( | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of shares held by Continuing Equity Owners | — | — | — | ( | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of tax withholding | — | — | — | — | — | ( | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at March 31, 2022 | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Repurchases of Class A common stock to treasury stock | — | — | — | — | — | — | ( | ( | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement of treasury stock | ( | — | — | — | — | — | ( | ( | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of shares held by Continuing Equity Owners | — | ( | — | ( | — | — | — | — | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of tax withholding | — | — | — | — | — | ( | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative translation adjustment | — | — | — | — | — | — | — | — | — | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at June 30, 2022 | $ | ( | $ | ( | $ | ( | $ | ( | $ | $ |
Class A Common Stock | Class B Common Stock | Class C Common Stock | Additional Paid-In Capital | Retained Deficit | Noncontrolling Interests | Total Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at December 31, 2020 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||
— | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of Class A common stock and fair value of equity-based compensation awards assumed in connection with VenueNext acquisition | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Transfer from Founder of right associated with Inspiration4 seat | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of shares held by Searchlight | — | ( | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of tax withholding | — | — | — | — | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at March 31, 2021 | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Exchange of shares held by Searchlight | — | ( | — | ( | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Vesting of restricted stock units, net of tax withholding | — | — | — | — | — | ( | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||||
Balances at June 30, 2021 | $ | $ | $ | $ | $ | ( | $ | $ | |||||||||||||||||||||||||||||||||||||||||||||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Six Months Ended June 30, | |||||||||||
2022 | 2021 | ||||||||||
Operating activities | |||||||||||
Net income (loss) | $ | $ | ( | ||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities | |||||||||||
Depreciation and amortization | |||||||||||
Amortization of capitalized financing costs | |||||||||||
Loss on extinguishment of debt | |||||||||||
Deferred income taxes | ( | ( | |||||||||
Provision for bad debts | |||||||||||
Revaluation of contingent liabilities | ( | ||||||||||
Impairment of intangible assets | |||||||||||
Equity-based compensation expense | |||||||||||
Other noncash items | |||||||||||
Change in operating assets and liabilities | |||||||||||
Accounts receivable | ( | ( | |||||||||
Prepaid expenses and other assets | ( | ||||||||||
Inventory | |||||||||||
Accounts payable | |||||||||||
Accrued expenses and other current liabilities | |||||||||||
Right-of-use assets and lease liabilities, net | ( | ||||||||||
Deferred revenue | |||||||||||
Net cash provided by operating activities | |||||||||||
Investing activities | |||||||||||
Acquisitions, net of cash acquired | ( | ( | |||||||||
Acquisition of equipment to be leased | ( | ( | |||||||||
Capitalized software development costs | ( | ( | |||||||||
Customer acquisition costs | ( | ( | |||||||||
Residual commission buyouts | ( | ( | |||||||||
Investments in securities | ( | ( | |||||||||
Acquisition of property, plant and equipment | ( | ( | |||||||||
Net cash used in investing activities | ( | ( | |||||||||
Financing activities | |||||||||||
Repurchases of Class A common stock to treasury stock | ( | ||||||||||
Payments for withholding tax related to vesting of restricted stock units | ( | ( | |||||||||
Deferred financing costs | ( | ( | |||||||||
Repayment of debt | ( | ||||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash and cash equivalents | ( | ||||||||||
Change in cash and cash equivalents | ( | ( | |||||||||
Cash and cash equivalents | |||||||||||
Beginning of period | |||||||||||
End of period | $ | $ | |||||||||
Supplemental cash flows information and noncash activities are further described in Note 20. | |||||||||||
See accompanying notes to unaudited condensed consolidated financial statements. |
Cash | $ | ||||
Shares of Class A common stock (a) | |||||
RSUs granted for fair value of equity-based compensation awards (b) | |||||
Contingent consideration (c) | |||||
Total purchase consideration | |||||
Less: cash acquired | ( | ||||
Total purchase consideration, net of cash acquired | $ | ||||
(a) Total purchase consideration includes | |||||
(b) The Company assumed all equity awards held by continuing employees. The portion of the fair value of the equity-based compensation awards associated with prior service of The Giving Block employees represents a component of the total consideration as presented above and was valued based on the fair value of The Giving Block awards on February 28, 2022, the acquisition date. | |||||
(c) The Company agreed to an earnout due to the former shareholders of The Giving Block in April 2023, calculated as a multiple of revenue earned by The Giving Block from March 1, 2022 to February 28, 2023, not to exceed $ |
Prepaid expenses and other current assets (a) | $ | ||||
Other intangible assets | |||||
Goodwill (b) | |||||
Accrued expenses and other current liabilities (a) | ( | ||||
Deferred revenue | ( | ||||
Deferred tax liability | ( | ||||
Net assets acquired | $ | ||||
(a) Includes $ | |||||
(b) Goodwill is not deductible for tax purposes. | |||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Payments-based revenue | $ | $ | $ | $ | |||||||||||||||||||
Subscription and other revenues | |||||||||||||||||||||||
Total | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Over-time revenue | $ | $ | $ | $ | |||||||||||||||||||
Point-in-time revenue | |||||||||||||||||||||||
Total | $ | $ | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Annual service fees and regulatory compliance fees | $ | $ | $ | $ | |||||||||||||||||||
Amount of these fees included in deferred revenue at beginning of period |
June 30, 2022 | June 30, 2021 | ||||||||||
Beginning balance | $ | $ | |||||||||
Additions to expense (a) | |||||||||||
Write-offs, net of recoveries and other adjustments | ( | ( | |||||||||
Ending balance | $ | $ | |||||||||
(a) For the six months ended June 30, 2021, includes a $ |
Balance at December 31, 2021 | $ | ||||
The Giving Block Acquisition (Note 2) | |||||
Balance at June 30, 2022 | $ |
Weighted Average Amortization Period (in years) | June 30, 2022 | ||||||||||||||||||||||
Carrying Value | Accumulated Amortization | Net Carrying Value | |||||||||||||||||||||
Merchant relationships | $ | $ | $ | ||||||||||||||||||||
Acquired technology | |||||||||||||||||||||||
Trademarks and trade names | |||||||||||||||||||||||
Capitalized software development costs | |||||||||||||||||||||||
Residual commission buyouts (a) | |||||||||||||||||||||||
Total other intangible assets, net | $ | $ | $ |
Weighted Average Amortization Period (in years) | December 31, 2021 | ||||||||||||||||||||||
Carrying Value | Accumulated Amortization | Net Carrying Value | |||||||||||||||||||||
Merchant relationships | $ | $ | $ | ||||||||||||||||||||
Acquired technology | |||||||||||||||||||||||
Trademarks and trade names | |||||||||||||||||||||||
Capitalized software development costs | |||||||||||||||||||||||
Residual commission buyouts (a) | |||||||||||||||||||||||
Total other intangible assets, net | $ | $ | $ | ||||||||||||||||||||
(a) Residual commission buyouts include contingent payments of $ |
2022 (remaining six months) | $ | ||||
2023 | |||||
2024 | |||||
2025 | |||||
2026 | |||||
Thereafter | |||||
Total | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Depreciation and amortization expense | $ | $ | $ | $ | |||||||||||||||||||
Cost of sales | |||||||||||||||||||||||
Total | $ | $ | $ | $ |
2022 (remaining six months) | $ | ||||
2023 | |||||
2024 | |||||
2025 | |||||
Total | $ |
Weighted Average Depreciation Period (in years) | June 30, 2022 | ||||||||||||||||||||||
Carrying Value | Accumulated Depreciation | Net Carrying Value | |||||||||||||||||||||
Equipment under lease | $ | $ | ( | $ | |||||||||||||||||||
Equipment held for lease (a) | N/A | ||||||||||||||||||||||
Total equipment for lease | $ | $ | ( | $ |
Weighted Average Depreciation Period (in years) | December 31, 2021 | ||||||||||||||||||||||
Carrying Value | Accumulated Depreciation | Net Carrying Value | |||||||||||||||||||||
Equipment under lease | $ | $ | ( | $ | |||||||||||||||||||
Equipment held for lease (a) | N/A | ||||||||||||||||||||||
Total equipment for lease, net | $ | $ | ( | $ | |||||||||||||||||||
(a) Represents equipment that was not yet initially deployed to a merchant and, accordingly, is not being depreciated. |
June 30, 2022 | December 31, 2021 | ||||||||||
Equipment | $ | $ | |||||||||
Capitalized software | |||||||||||
Leasehold improvements | |||||||||||
Furniture and fixtures | |||||||||||
Vehicles | |||||||||||
Total property, plant and equipment, gross | |||||||||||
Less: Accumulated depreciation | ( | ( | |||||||||
Total property, plant and equipment, net | $ | $ |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Depreciation and amortization expense | $ | $ | $ | $ | |||||||||||||||||||
Cost of sales | |||||||||||||||||||||||
Total depreciation expense | $ | $ | $ | $ |
Maturity | Effective Interest Rate | June 30, 2022 | December 31, 2021 | |||||||||||||||||||||||
Convertible Notes due 2025 (2025 Convertible Notes) | December 15, 2025 | $ | $ | |||||||||||||||||||||||
Convertible Notes due 2027 (2027 Convertible Notes) | August 1, 2027 | |||||||||||||||||||||||||
Senior Notes due 2026 (2026 Senior Notes) | November 1, 2026 | |||||||||||||||||||||||||
Total borrowings | ||||||||||||||||||||||||||
Less: Unamortized capitalized financing fees | ( | ( | ||||||||||||||||||||||||
Total long-term debt | $ | $ |
2025 | $ | |||||||
2026 | ||||||||
2027 | ||||||||
Total | $ |
June 30, 2022 | December 31, 2021 | ||||||||||
Principal outstanding | $ | $ | |||||||||
Unamortized debt issuance costs | ( | ( | |||||||||
Net carrying value | $ | $ |
June 30, 2022 | December 31, 2021 | ||||||||||
Principal outstanding | $ | $ | |||||||||
Unamortized debt issuance costs | ( | ( | |||||||||
Net carrying value | $ | $ |
June 30, 2022 | December 31, 2021 | ||||||||||
Crypto settlement assets (a) | $ | $ | |||||||||
Prepaid insurance | |||||||||||
Prepaid merchant signing bonuses (b) | |||||||||||
Other prepaid expenses (c) | |||||||||||
Taxes receivable | |||||||||||
Contract assets | |||||||||||
Agent and employee loan receivables | |||||||||||
Other current assets | |||||||||||
Total prepaid expenses and other current assets | $ | $ | |||||||||
(a) See the disclosure within “Accounting Pronouncements Adopted” in Note 1 for information regarding the Company’s crypto settlement assets. | |||||||||||
(b) Represents deal bonuses paid to merchants to obtain processing contracts, which are amortized over their contractual term of one year. | |||||||||||
(c) Includes prepayments related to information technology, rent, tradeshows and conferences. |
June 30, 2022 | December 31, 2021 | ||||||||||
Contingent liability earnout - The Giving Block (a) | $ | $ | |||||||||
Residuals payable | |||||||||||
Accrued interest | |||||||||||
Accrued payroll | |||||||||||
Taxes payable | |||||||||||
Deferred employer social security tax pursuant to the CARES Act | |||||||||||
Crypto settlement liabilities (b) | |||||||||||
Restructuring accrual (c) | |||||||||||
Other current liabilities | |||||||||||
Total accrued expenses and other current liabilities | $ | $ | |||||||||
(a) Represents the fair value of the contingent liability earnout for The Giving Block as of June 30, 2022, including $ | |||||||||||
(b) See the disclosure within “Accounting Pronouncements Adopted” in Note 1 for information regarding the Company’s crypto settlement liabilities. | |||||||||||
(c) The Company made severance payments of $ |
Six Months Ended June 30, | |||||||||||
2022 | 2021 | ||||||||||
Balance at beginning of period | $ | $ | |||||||||
Contingent consideration for The Giving Block acquisition | |||||||||||
Cash payments made for contingent liabilities related to earnout payments | ( | ||||||||||
Fair value adjustments | ( | ||||||||||
Balance at end of period | $ | $ | |||||||||
June 30, 2022 | December 31, 2021 | ||||||||||||||||||||||
Carrying Value (a) | Fair Value | Carrying Value (a) | Fair Value | ||||||||||||||||||||
2025 Convertible Notes | $ | $ | $ | $ | |||||||||||||||||||
2027 Convertible Notes | |||||||||||||||||||||||
2026 Senior Notes | |||||||||||||||||||||||
Total | $ | $ | $ | $ | |||||||||||||||||||
(a) Carrying value excludes unamortized debt issuance costs related to the Revolving Credit Facility of $ |
June 30, 2022 | December 31, 2021 | ||||||||||
Assets | |||||||||||
Right-of-use assets | $ | $ | |||||||||
Liabilities | |||||||||||
Current lease liabilities | $ | $ | |||||||||
Noncurrent lease liabilities | |||||||||||
Total lease liabilities | $ | $ |
2022 (remaining six months) | $ | ||||
2023 | |||||
2024 | |||||
2025 | |||||
2026 | |||||
Thereafter | |||||
Total lease payments | |||||
Less: Interest | ( | ||||
Present value of minimum payments | $ |
June 30, 2022 | December 31, 2021 | ||||||||||
Weighted average remaining lease term (in years): | |||||||||||
Weighted average discount rate | % | % |
June 30, 2022 | December 31, 2021 | ||||||||||||||||||||||
LLC Interests | Ownership % | LLC Interests | Ownership % | ||||||||||||||||||||
Shift4 Payments, Inc. | % | % | |||||||||||||||||||||
Continuing Equity Owners | % | % | |||||||||||||||||||||
Total | 100.0 | % | 100.0 | % |
Six Months Ended June 30, 2022 | |||||||||||
Number of RSUs | Weighted Average Grant Date Fair Value | ||||||||||
Unvested balance at beginning of period | $ | ||||||||||
Granted (a) | |||||||||||
Vested | ( | ||||||||||
Forfeited or cancelled | ( | ||||||||||
Unvested balance at end of period | $ | ||||||||||
(a) Includes |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Net income (loss) | $ | $ | $ | $ | ( | ||||||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | ( | ( | |||||||||||||||||||||
Net income (loss) attributable to Shift4 Payments, Inc. | ( | ||||||||||||||||||||||
Adjustment to net income (loss) attributable to common stockholders | ( | ||||||||||||||||||||||
Net income (loss) attributable to common stockholders | $ | $ | $ | $ | ( | ||||||||||||||||||
Numerator - allocation of net income (loss) attributable to common stockholders: | |||||||||||||||||||||||
Net income (loss) allocated to Class A common stock - basic | $ | $ | $ | $ | ( | ||||||||||||||||||
Reallocation of net income (loss) attributable to common stockholders from assumed conversion of LLC interests and assumed vesting of RSUs | ( | ||||||||||||||||||||||
Net income (loss) allocated to Class A common stock - diluted | $ | $ | $ | $ | ( | ||||||||||||||||||
Net income (loss) allocated to Class C common stock - basic | $ | $ | $ | $ | ( | ||||||||||||||||||
Reallocation of net income attributable to common stockholders from assumed conversion of LLC interests and assumed vesting of RSUs | ( | ( | |||||||||||||||||||||
Net income (loss) allocated to Class C common stock - diluted | $ | $ | $ | $ | ( | ||||||||||||||||||
Denominator: | |||||||||||||||||||||||
Weighted average shares of Class A common stock outstanding - basic | |||||||||||||||||||||||
Effect of dilutive securities: | |||||||||||||||||||||||
LLC Interests | |||||||||||||||||||||||
RSUs | |||||||||||||||||||||||
2025 Convertible Notes | |||||||||||||||||||||||
Weighted average shares of Class A common stock outstanding - diluted | |||||||||||||||||||||||
Weighted average shares of Class C common stock outstanding - basic and diluted | |||||||||||||||||||||||
Net income (loss) per share - Basic: | |||||||||||||||||||||||
Class A common stock | $ | $ | $ | $ | ( | ||||||||||||||||||
Class C common stock | $ | $ | $ | $ | ( | ||||||||||||||||||
Net income (loss) per share - Diluted: | |||||||||||||||||||||||
Class A Common Stock | $ | $ | $ | $ | ( | ||||||||||||||||||
Class C Common Stock | $ | $ | $ | $ | ( |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
LLC Interests that convert into potential Class A common shares | |||||||||||||||||||||||
RSUs and performance RSUs - employee | |||||||||||||||||||||||
RSUs - non-employee directors | |||||||||||||||||||||||
Total |
Six Months Ended June 30, | |||||||||||
2022 | 2021 | ||||||||||
Cash paid for interest | $ | $ | |||||||||
Cash paid for income taxes, net of refunds | |||||||||||
Noncash investing activities | |||||||||||
Shares and equity-based compensation awards issued in connection with The Giving Block acquisition | |||||||||||
Shares and equity-based compensation awards issued in connection with VenueNext acquisition | |||||||||||
Shares issued in connection with residual commission buyouts | |||||||||||
Equipment for lease | |||||||||||
Capitalized software development costs | |||||||||||
Noncash financing activities | |||||||||||
Right-of-use assets obtained in exchange for operating lease liabilities | |||||||||||
Right associated with Inspiration4 seat |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Payments-based revenue | $ | $ | $ | $ | |||||||||||||||||||
Subscription and other revenues | |||||||||||||||||||||||
Gross revenue | |||||||||||||||||||||||
Less: network fees | |||||||||||||||||||||||
Less: Other costs of sales | |||||||||||||||||||||||
Gross profit | $ | $ | $ | $ |
Three Months Ended June 30, | |||||||||||||||||||||||
(in millions) | 2022 | 2021 | $ change | % change | |||||||||||||||||||
Payments-based revenue | $ | 473.9 | $ | 324.8 | $ | 149.1 | 45.9 | % | |||||||||||||||
Subscription and other revenues | 32.8 | 26.2 | 6.6 | 25.2 | % | ||||||||||||||||||
Gross revenue | 506.7 | 351.0 | 155.7 | 44.4 | % | ||||||||||||||||||
Less: Network fees | 324.1 | 214.7 | 109.4 | 51.0 | % | ||||||||||||||||||
Less: Other costs of sales | 76.8 | 58.2 | 18.6 | 32.0 | % | ||||||||||||||||||
Gross profit | 105.8 | 78.1 | 27.7 | 35.5 | % | ||||||||||||||||||
General and administrative expenses | 58.0 | 51.7 | 6.3 | 12.2 | % | ||||||||||||||||||
Depreciation and amortization expense | 16.7 | 15.5 | 1.2 | 7.7 | % | ||||||||||||||||||
Professional fees | 5.2 | 3.5 | 1.7 | 48.6 | % | ||||||||||||||||||
Advertising and marketing expenses | 2.9 | 2.5 | 0.4 | 16.0 | % | ||||||||||||||||||
Restructuring expenses | 0.1 | — | 0.1 | NM | |||||||||||||||||||
Transaction-related expenses | — | — | — | NM | |||||||||||||||||||
Total operating expenses | 82.9 | 73.2 | 9.7 | 13.3 | % | ||||||||||||||||||
Income from operations | 22.9 | 4.9 | 18.0 | NM | |||||||||||||||||||
Loss on extinguishment of debt | — | — | — | NM | |||||||||||||||||||
Interest income | 1.4 | — | 1.4 | NM | |||||||||||||||||||
Other income, net | 0.1 | — | 0.1 | NM | |||||||||||||||||||
Interest expense | (8.4) | (6.3) | (2.1) | 33.3 | % | ||||||||||||||||||
Income (loss) before income taxes | 16.0 | (1.4) | 17.4 | NM | |||||||||||||||||||
Income tax benefit (provision) | (1.0) | 5.9 | (6.9) | NM | |||||||||||||||||||
Net income | 15.0 | 4.5 | 10.5 | 233.3 | % | ||||||||||||||||||
Net income attributable to noncontrolling interests | 4.7 | 1.3 | 3.4 | NM | |||||||||||||||||||
Net income attributable to Shift4 Payments, Inc. | $ | 10.3 | $ | 3.2 | $ | 7.1 | 221.9 | % |
Six Months Ended June 30, | |||||||||||||||||||||||
(in millions) | 2022 | 2021 | $ change | % change | |||||||||||||||||||
Payments-based revenue | $ | 845.4 | $ | 540.7 | $ | 304.7 | 56.4 | % | |||||||||||||||
Subscription and other revenues | 63.2 | 49.6 | 13.6 | 27.4 | % | ||||||||||||||||||
Gross revenue | 908.6 | 590.3 | 318.3 | 53.9 | % | ||||||||||||||||||
Less: Network fees | 577.2 | 356.5 | 220.7 | 61.9 | % | ||||||||||||||||||
Less: Other costs of sales | 141.0 | 103.9 | 37.1 | 35.7 | % | ||||||||||||||||||
Gross profit | 190.4 | 129.9 | 60.5 | 46.6 | % | ||||||||||||||||||
General and administrative expenses | 124.2 | 105.2 | 19.0 | 18.1 | % | ||||||||||||||||||
Depreciation and amortization expense | 34.0 | 30.9 | 3.1 | 10.0 | % | ||||||||||||||||||
Professional fees | 13.9 | 9.7 | 4.2 | 43.3 | % | ||||||||||||||||||
Advertising and marketing expenses | 5.6 | 22.6 | (17.0) | (75.2) | % | ||||||||||||||||||
Restructuring expenses | 0.1 | 0.1 | — | NM | |||||||||||||||||||
Transaction-related expenses | 1.4 | — | 1.4 | NM | |||||||||||||||||||
Total operating expenses | 179.2 | 168.5 | 10.7 | 6.4 | % | ||||||||||||||||||
Income (loss) from operations | 11.2 | (38.6) | 49.8 | (129.0) | % | ||||||||||||||||||
Loss on extinguishment of debt | — | (0.2) | 0.2 | (100.0) | % | ||||||||||||||||||
Interest income | 1.4 | — | 1.4 | NM | |||||||||||||||||||
Other income, net | 0.3 | — | 0.3 | NM | |||||||||||||||||||
Interest expense | (16.3) | (12.8) | (3.5) | 27.3 | % | ||||||||||||||||||
Loss before income taxes | (3.4) | (51.6) | 48.2 | (93.4) | % | ||||||||||||||||||
Income tax benefit | 5.2 | 5.1 | 0.1 | 2.0 | % | ||||||||||||||||||
Net income (loss) | 1.8 | (46.5) | 48.3 | NM | |||||||||||||||||||
Net loss attributable to noncontrolling interests | (1.0) | (16.9) | 15.9 | (94.1) | % | ||||||||||||||||||
Net income (loss) attributable to Shift4 Payments, Inc. | $ | 2.8 | $ | (29.6) | $ | 32.4 | NM |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
(in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
End-to-end payment volume | $ | 16,873.1 | $ | 11,833.9 | $ | 30,294.0 | $ | 19,820.7 | |||||||||||||||
Gross revenue less network fees | 182.6 | 136.3 | 331.4 | 233.8 | |||||||||||||||||||
EBITDA | 52.9 | 30.6 | 70.5 | 12.2 | |||||||||||||||||||
Adjusted EBITDA | 65.6 | 45.2 | 109.9 | 67.4 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
(in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Gross profit | $ | 105.8 | $ | 78.1 | $ | 190.4 | $ | 129.9 | |||||||||||||||
Add back: Other costs of sales | 76.8 | 58.2 | 141.0 | 103.9 | |||||||||||||||||||
Gross revenue less network fees | $ | 182.6 | $ | 136.3 | $ | 331.4 | $ | 233.8 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
(in millions) | 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||
Net income (loss) | $ | 15.0 | $ | 4.5 | $ | 1.8 | $ | (46.5) | |||||||||||||||
Interest expense | 8.4 | 6.3 | 16.3 | 12.8 | |||||||||||||||||||
Interest income | (1.4) | — | (1.4) | — | |||||||||||||||||||
Income tax provision (benefit) | 1.0 | (5.9) | (5.2) | (5.1) | |||||||||||||||||||
Depreciation and amortization expense | 29.9 | 25.7 | 59.0 | 51.0 | |||||||||||||||||||
EBITDA | 52.9 | 30.6 | 70.5 | 12.2 | |||||||||||||||||||
Acquisition, restructuring and integration costs (a) | 2.4 | 3.2 | 10.2 | 29.0 | |||||||||||||||||||
Equity-based compensation (b) | 9.7 | 11.3 | 26.8 | 25.4 | |||||||||||||||||||
Other nonrecurring items (c) | 0.6 | 0.1 | 2.4 | 0.8 | |||||||||||||||||||
Adjusted EBITDA | $ | 65.6 | $ | 45.2 | $ | 109.9 | $ | 67.4 | |||||||||||||||
(a) For the three months ended June 30, 2022, primarily consisted of $2.5 million of acquisition-related costs, partially offset by a $0.3 million adjustment to contingent consideration for the The Giving Block acquisition. For the three months ended June 30, 2021, primarily consisted of $1.4 million of acquisition-related costs and $1.3 million of expenses related to the integration of 3dcart and its rebranding as Shift4Shop. For the six months ended June 30, 2022, primarily consisted of $8.3 million of acquisition-related costs and $1.4 million of transaction-related expenses associated with a consent solicitation for the 2026 Senior Notes in March 2022, partially offset by a $0.3 million adjustment to contingent consideration for the The Giving Block acquisition. For the six months ended June 30, 2021, primarily consisted of $20.4 million of expenses related to the integration of 3dcart and its rebranding as Shift4Shop, $4.3 million of acquisition-related costs, and $2.1 million of expense for the Inspiration4 seat. | |||||||||||||||||||||||
(b) Represents equity-based compensation expense for RSUs, including employer taxes for vested RSUs. See Note 18 in the notes to the accompanying unaudited condensed consolidated financial statements for more information on equity-based compensation. | |||||||||||||||||||||||
(c) For the six months ended June 30, 2022, primarily consisted of $1.2 million of costs associated with an internal processing system disruption that required technical remediation, $0.4 million of costs associated with an early retirement initiative completed in the first quarter of 2022 and $0.3 million of legal and professional fees for one-time matters. |
Six Months Ended June 30, | |||||||||||
(in millions) | 2022 | 2021 | |||||||||
Net cash provided by operating activities | $ | 85.0 | $ | 5.0 | |||||||
Net cash used in investing activities | (87.1) | (115.5) | |||||||||
Net cash used in financing activities | (211.0) | (117.6) | |||||||||
Effect of exchange rate changes on cash and cash equivalents | (0.2) | — | |||||||||
Total | $ | (213.3) | $ | (228.1) |
Period | Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a) | Approximate Dollar Value of Shares that May Yet Be Purchased under the Plans or Programs (in millions) | ||||||||||||||||||||||
April 1-30, 2022 | 1,126,277 | $ | 54.39 | 1,126,277 | $ | — | ||||||||||||||||||||
May 1-31, 2022 | 1,793,954 | 44.58 | 1,793,954 | 20.4 | ||||||||||||||||||||||
June 1-30, 2022 | 665,450 | 38.92 | 665,450 | 44.5 | ||||||||||||||||||||||
Total | 3,585,681 | |||||||||||||||||||||||||
(a) On December 16, 2021, our Board authorized a stock repurchase program (the “December 2021 Program”), pursuant to which we were authorized to repurchase up to $100.0 million of shares of our Class A common stock through December 31, 2022. On May 11, 2022, the Board authorized a stock repurchase program (the “May 2022 Program”), pursuant to which we were authorized to repurchase up to an additional $100.0 million of shares of our Class A common stock through December 31, 2022. On June 15, 2022, the Board authorized a stock repurchase program (the “June 2022 Program” and, together with the December 2021 Program and the May 2022 Program, the “Programs”), pursuant to which we were authorized to repurchase up to an additional $50.0 million of shares of our Class A common stock through December 31, 2022. Repurchases under the Programs may be made in the open market, in privately negotiated transactions or otherwise, with the amount and timing of repurchases depending on market conditions and corporate needs. Open market repurchases will be structured to occur within the pricing and volume requirements of Rule 10b-18 of the Exchange Act. We may also, from time to time, enter into Rule 10b5-1 of the Exchange Act plans to facilitate repurchases of our shares under this authorization. The exact number of shares to be repurchased by us is not guaranteed and the Programs may be suspended, modified, or discontinued at any time at our discretion and without prior notice. |
Incorporated by Reference | ||||||||||||||||||||||||||||||||||||||
Exhibit Number | Exhibit Description | Form | File No. | Exhibit | Filing Date | Filed/Furnished Herewith | ||||||||||||||||||||||||||||||||
3.1 | S-8 | 333-239042 | 4.1 | 06/09/2020 | ||||||||||||||||||||||||||||||||||
3.2 | S-8 | 333-239042 | 4.2 | 06/09/2020 | ||||||||||||||||||||||||||||||||||
4.1 | S-1/A | 333-238307 | 4.1 | 06/01/2020 | ||||||||||||||||||||||||||||||||||
4.2 | 8-K | 001-39313 | 4.1 | 10/29/2020 |
4.3 | 8-K | 001-39313 | 4.1 | 12/07/2020 | ||||||||||||||||||||||||||||||||||
4.4 | 8-K | 001-39313 | 4.1 | 07/26/2021 | ||||||||||||||||||||||||||||||||||
4.5 | 10-Q | 001-39313 | 4.5 | 05/06/2022 | ||||||||||||||||||||||||||||||||||
10.1 | 8-K | 001-39313 | 10.1 | 06/13/2022 | ||||||||||||||||||||||||||||||||||
31.1 | * | |||||||||||||||||||||||||||||||||||||
31.2 | * | |||||||||||||||||||||||||||||||||||||
32.1 | ** | |||||||||||||||||||||||||||||||||||||
32.2 | ** | |||||||||||||||||||||||||||||||||||||
101.INS | Inline XBRL Instance Document. | * | ||||||||||||||||||||||||||||||||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document. | * | ||||||||||||||||||||||||||||||||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | * | ||||||||||||||||||||||||||||||||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | * | ||||||||||||||||||||||||||||||||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | * | ||||||||||||||||||||||||||||||||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | * | ||||||||||||||||||||||||||||||||||||
104* | Cover Page Interactive Data File (formatting as Inline XBRL and contained in Exhibit 101). | |||||||||||||||||||||||||||||||||||||
* Filed herewith. | ||||||||||||||||||||||||||||||||||||||
** Furnished herewith. | ||||||||||||||||||||||||||||||||||||||
Shift4 Payments, Inc. | |||||||||||
By: | /s/ Jared Isaacman | ||||||||||
Jared Isaacman | |||||||||||
Date: | August 5, 2022 | Chief Executive Officer (principal executive officer) | |||||||||
By: | /s/ Bradley Herring | ||||||||||
Bradley Herring | |||||||||||
Date: | August 5, 2022 | Chief Financial Officer (principal financial officer) |
Date: August 5, 2022 | By: | /s/Jared Isaacman | ||||||
Jared Isaacman | ||||||||
Chief Executive Officer | ||||||||
(principal executive officer) |
Date: August 5, 2022 | By: | /s/ Bradley Herring | ||||||
Bradley Herring | ||||||||
Chief Financial Officer | ||||||||
(principal financial officer) |
Date: August 5, 2022 | By: | /s/ Jared Isaacman | ||||||
Jared Isaacman | ||||||||
Chief Executive Officer | ||||||||
(principal executive officer) |
Date: August 5, 2022 | By: | /s/ Bradley Herring | ||||||
Bradley Herring | ||||||||
Chief Financial Officer | ||||||||
(principal financial officer) |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 15.0 | $ 4.5 | $ 1.8 | $ (46.5) |
Other comprehensive income (loss) | ||||
Unrealized income (loss) on foreign currency translation adjustment, net of tax | (0.6) | 0.0 | (0.6) | 0.0 |
Total other comprehensive income (loss) | (0.6) | 0.0 | (0.6) | 0.0 |
Comprehensive income (loss) | 14.4 | 4.5 | 1.2 | (46.5) |
Comprehensive income (loss) attributable to noncontrolling interests | 4.5 | 1.3 | (1.2) | (16.9) |
Comprehensive income (loss) attributable to Shift4 Payments, Inc. | $ 9.9 | $ 3.2 | $ 2.4 | $ (29.6) |
Organization, Basis of Presentation and Significant Accounting Policies |
6 Months Ended |
---|---|
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Basis of Presentation and Significant Accounting Policies | Organization, Basis of Presentation and Significant Accounting Policies Organization Shift4 Payments, Inc., (“Shift4 Payments”) (“the Company”), was incorporated in Delaware on November 5, 2019 in order to carry on the business of Shift4 Payments, LLC and its consolidated subsidiaries. The Company is a leading provider of integrated payment processing and technology solutions. Through the Shift4 Model, the Company offers software providers a single integration to an end-to-end payments offering, a powerful gateway and a robust suite of technology solutions (including cloud enablement, business intelligence, analytics, and mobile) to enhance the value of their software suites and simplify payment acceptance. The Company provides for its merchants a seamless customer experience at scale, rather than simply acting as one of multiple providers they rely on to operate their businesses. The Shift4 Model is built to serve a range of merchants from small-to-medium-sized businesses to large and complex enterprises across numerous verticals, including food and beverage, hospitality, stadiums and arenas, gaming, specialty retail, non-profits, eCommerce, and exciting technology companies. This includes the Company’s point of sale (“POS”) software offerings, as well as over 425 additional software integrations in virtually every industry. Basis of Presentation The accompanying interim condensed consolidated financial statements of the Company are unaudited. These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial information. As such, these financial statements do not include all information and footnotes required by U.S. GAAP for complete financial statements. The December 31, 2021 Condensed Consolidated Balance Sheet was derived from audited financial statements as of that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments consisting only of normal recurring adjustments necessary to state fairly the financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP applicable to interim periods. The results of operations for the interim periods presented are not necessarily indicative of results for the full year or future periods. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto as of and for the fiscal year ended December 31, 2021, as disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (the “2021 Form 10-K”). The unaudited condensed consolidated financial statements include the accounts of Shift4 Payments, Inc. and its wholly-owned subsidiaries. Shift4 Payments, Inc. consolidates the financial results of Shift4 Payments, LLC, which is considered a variable interest entity (“VIE”). Shift4 Payments, Inc. is the primary beneficiary and sole managing member of Shift4 Payments, LLC and has decision making authority that significantly affects the economic performance of the entity. As a result, the Company consolidates Shift4 Payments, LLC and reports a noncontrolling interest representing the economic interest in Shift4 Payments, LLC held by Rook Holdings Inc. (“Rook”). Prior to May 24, 2022, the noncontrolling interest also included the economic interest in Shift4 Payments, LLC held by certain affiliates of Searchlight Capital Partners (“Searchlight”) (together with Rook, the “Continuing Equity Owners”). All intercompany balances and transactions have been eliminated in consolidation. The assets and liabilities of Shift4 Payments, LLC represent substantially all of the consolidated assets and liabilities of Shift4 Payments, Inc. with the exception of certain cash balances, contingent consideration for earnout liabilities for The Giving Block, Inc. (“The Giving Block”), and the aggregate principal amount of $690.0 million of 2025 Convertible Notes and $632.5 million of 2027 Convertible Notes that are held by Shift4 Payments, Inc. directly. As of both June 30, 2022 and December 31, 2021, $9.8 million of cash was held by Shift4 Payments, Inc. As of June 30, 2022, the earnout liabilities for The Giving Block were $58.9 million. Shift4 Payments, Inc., which was established November 5, 2019, has not had any material operations on a standalone basis since its inception, and all of the operations of the Company are carried out by Shift4 Payments, LLC and its subsidiaries. Certain prior year balances have been adjusted to present contract assets within the line item “Prepaid expenses and other current assets” rather than in its own line item on the Company’s unaudited Condensed Consolidated Balance Sheets. Liquidity and Management’s Plan As of June 30, 2022, the Company had $1,772.5 million total principal amount of debt outstanding and was in compliance with the financial covenants under its debt agreements. The Company expects to be in compliance for at least 12 months following issuance of these unaudited condensed consolidated financial statements. See Note 9 for further information on the Company’s debt obligations. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Significant estimates inherent in the preparation of the accompanying unaudited condensed consolidated financial statements include estimates of fair value of acquired assets and liabilities through business combinations, fair value of contingent liabilities related to earnout payments, fair value of debt instruments, allowance for doubtful accounts, income taxes, investments in securities and noncontrolling interests. Estimates are based on past experience and other considerations reasonable under the circumstances. Actual results may differ from these estimates. Significant Accounting Policies The Company’s significant accounting policies are discussed in Note 2 to Shift4 Payments, Inc.’s consolidated financial statements as of and for the year ended December 31, 2021 in the 2021 Form 10-K. There have been no significant changes to these policies which have had a material impact on the Company’s unaudited condensed consolidated financial statements and related notes during the six months ended June 30, 2022 except for the below. Crypto Settlement Assets and Liabilities The Company recognizes a liability accompanied by an asset of the same value to reflect its obligation to safeguard the crypto settlement assets it holds on behalf of users of The Giving Block’s platform. These crypto settlement assets are comprised of numerous cryptocurrencies that are traded on numerous cryptocurrency exchanges. The liability and asset are remeasured at each reporting date at the fair value of the crypto settlement assets, which is determined using quoted prices from cryptocurrency exchanges. The Company’s agent, which acts as a cryptocurrency exchange and custodian, holds the cryptographic key information of the crypto settlement assets and is primarily obligated to secure the assets and protect them from loss or theft. The Company maintains the internal recordkeeping of the assets. Recent Accounting Pronouncements Accounting Pronouncements Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Codification (“ASC”) 842, Leases (“ASC 842”) with amendments in 2018 and 2019. This accounting guidance requires a lessee to record assets and liabilities on the balance sheet for the rights and obligations arising from leases with terms of more than 12 months. On January 1, 2021, the Company adopted ASC 842 using the modified retrospective method, reflecting the adoption in the Company’s annual results for the period ended December 31, 2021. Prior period amounts were not adjusted and continue to be reported in accordance with historic accounting under previous lease guidance, ASC 840, Leases (“ASC 840”). The Company elected to use the package of practical expedients permitted under the transition guidance. The Company did not reassess (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases, or (iii) initial direct costs for any existing leases. For lease agreements where the Company is a lessee that include lease and non-lease components, the Company elected to use the practical expedient on all leases entered into or modified after January 1, 2021 to combine lease and non-lease components for all classes of assets. Additionally, the Company elected to not record leases with a term of twelve months or less on the balance sheet. Upon adoption, the Company recorded right-of-use assets of $21.4 million and lease liabilities of $25.7 million. The adoption of ASC 842 did not result in a material impact to the unaudited Condensed Consolidated Statements of Operations or unaudited Condensed Consolidated Statements of Cash Flows. See Note 13 for ASC 842-related disclosures. In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326), which changes the impairment model for most financial assets, including accounts receivable, and replaces the existing incurred loss impairment model with a current expected credit loss (“CECL”) methodology, which will result in more timely recognition of credit losses. The Company adopted ASU 2016-13 on a modified retrospective basis on December 31, 2021, reflecting the adoption as of January 1, 2021 in the Company's annual results for the period ended December 31, 2021 and interim periods beginning January 1, 2022. The adoption of ASU 2016-13 did not result in a material impact on the Company’s unaudited condensed consolidated financial statements and disclosures. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an acquirer to account for revenue contracts acquired in a business combination in accordance with ASC 606, as if it had originated the contracts. Prior to ASU 2021-08, an acquirer generally recognized assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers and other similar contracts, at fair value on the acquisition date. The Company adopted ASU 2021-08 in the third quarter of 2021 and retrospectively applied the ASU to its acquisitions that occurred in 2021. The adoption of ASU 2021-08 resulted in an increase to “Deferred revenue” of $5.7 million, of which $1.8 million was recognized as an increase to “Gross revenue” for the fiscal year ended December 31, 2021. In July 2021, the FASB issued ASU 2021-05, Lessors—Certain Leases with Variable Lease Payments, to amend lessor accounting for certain leases with variable lease payments that do not depend on a reference index or a rate and would have resulted in the recognition of a loss at lease commencement if classified as a sales-type or a direct financing lease. ASU 2021-05 amends the classification requirements of such leases for lessors to require operating lease classification. The Company adopted ASU 2021-05 on a retrospective basis effective January 1, 2022. The adoption did not have a significant impact on the Company’s unaudited condensed consolidated financial statements. In March 2022, the SEC issued Staff Accounting Bulletin No. 121 (“SAB 121”), which provided interpretive guidance regarding the accounting for obligations to safeguard crypto-assets an entity holds for users of its crypto platform. This guidance requires entities that hold crypto-assets on behalf of platform users to recognize a liability accompanied by an asset of the same value on its balance sheet to reflect the entity’s obligation to safeguard the crypto-assets held for its platform users. The liability and asset should be measured at initial recognition and each reporting date at the fair value of the crypto-assets that the entity is responsible for holding for its platform users. The entity should also describe in the footnotes to the financial statements the nature and amount of crypto-assets the entity is responsible for safeguarding for its platform users and how the fair value is determined, and should also consider including information regarding who (e.g. the entity, its agent, or another third party) holds the cryptographic key information, maintains the internal recordkeeping of those assets, and is obligated to secure the assets and protect them from loss or theft. This guidance is effective from the first interim period after June 15, 2022 and should be applied retrospectively. The Company adopted SAB 121 on a retrospective basis effective June 30, 2022, resulting in the recognition of $1.2 million of crypto settlement assets within “Prepaid expenses and other current assets” and $1.2 million of crypto settlement liabilities within “Accrued expenses and other current liabilities” on the Company’s unaudited Condensed Consolidated Balance Sheets as of June 30, 2022 associated with The Giving Block. The adoption of this guidance had no impact on the Company’s unaudited Condensed Consolidated Statements of Operations and unaudited Condensed Consolidated Statements of Cash Flows. Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform, which provides optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships, subject to certain criteria, that reference the London Interbank Offered Rate (“LIBOR”), or another reference rate that is expected to be discontinued. Companies may elect to apply these amendments through December 31, 2022. The Company is currently evaluating whether we will elect the optional expedients, as well as evaluating the impact of ASU 2020-04 on the Company’s unaudited condensed consolidated financial statements.
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Acquisitions |
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Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisitions | Acquisitions Each of the following acquisitions was accounted for as a business combination using the acquisition method of accounting. The respective purchase prices were allocated to the assets acquired and liabilities assumed based on the estimated fair values at the date of acquisition. The excess of the purchase price over the fair value of the net assets acquired was allocated to goodwill and represents the future economic benefits arising from other assets acquired, which cannot be individually identified or separately recognized. Under the acquisition method of accounting for business combinations, if there are changes to acquired deferred tax balances, valuation allowances or liabilities related to uncertain tax positions during the measurement period, and they are related to new information obtained about facts and circumstances that existed as of the acquisition date, those changes are considered a measurement-period adjustment, with the offset recorded to goodwill. The Giving Block On February 28, 2022, the Company acquired The Giving Block by acquiring 100% of its common stock for $106.9 million of estimated total purchase consideration, net of cash acquired. The Giving Block is a cryptocurrency donation marketplace that the Company expects to accelerate its growth in the non-profit sector with significant cross-sell potential. Total purchase consideration was as follows:
The following table summarizes the fair value assigned to the assets acquired and liabilities assumed at the acquisition date. These amounts reflect various preliminary fair value estimates and assumptions, and are subject to change within the measurement period as valuations are finalized. The primary areas of preliminary purchase price allocation subject to change relate to the valuation of contingent consideration, accrued expenses and other current liabilities assumed, and residual goodwill.
In the six months ended June 30, 2022, the Company incurred expenses in connection with The Giving Block acquisition of $2.2 million. These expenses are included in “Professional fees” in the Company’s unaudited Condensed Consolidated Statements of Operations. The fair values of intangible assets were estimated using inputs classified as Level 3 under the income approach using either the relief-from-royalty method (developed technology and trade name), the with or without method (donor relationships) or the multi-period excess earnings method (customer relationships). The contingent liability arising from the expected earnout payment included in purchase consideration was measured on the acquisition date using a Monte Carlo simulation in a risk-neutral framework, calibrated to Management’s revenue forecasts. The transaction was not taxable for income tax purposes. The weighted average life of developed technology, the trade name, donor relationships and customer relationships is 8 years, 15 years, 5 years and 15 years, respectively. The goodwill arising from the acquisition largely consisted of revenue synergies associated with a larger total addressable market and the ability to cross-sell existing customers, new customers and technology capabilities. The Giving Block acquisition did not have a material impact on the Company’s unaudited condensed consolidated financial statements. Accordingly, revenue and expenses related to the acquisition and pro forma financial information have not been presented. Postec On September 1, 2021, the Company acquired Postec, Inc. (“Postec”) by acquiring 100% of its membership interests for $14.3 million in cash, net of cash acquired. The purchase was funded with cash on hand. This acquisition enables the boarding of the vendor’s customers on the Company’s end-to-end acquiring solution and empowers the Company’s distribution partners to sign the vendor’s customer accounts and leverage the combined expertise to handle all aspects of installation, service, and support, similar to the hospitality technology vendor acquired in October 2020. Pending Finaro Acquisition On March 1, 2022, the Company entered into a definitive agreement to acquire Credorax, Inc. d/b/a Finaro (“Finaro”) for $200.0 million in cash on hand, 6,439,316 shares of the Company’s Class A common stock with a value of approximately $325.0 million as of March 1, 2022, determined by the volume weighted average price for the thirty trading days preceding the date of the agreement, and a performance-based earnout of up to $50.0 million in the Company’s Class A common stock. Consummation of the merger is subject to regulatory approvals, which the Company expects to receive in the fourth quarter of 2022. Finaro is a cross-border eCommerce platform and bank specializing in solving complex payment problems for multi-national merchants that the Company believes will accelerate its growth in international markets. In the three and six months ended June 30, 2022, the Company incurred expenses in connection with the Finaro acquisition of $1.1 million and $4.7 million, respectively. These expenses are included in “Professional fees” in the Company’s unaudited Condensed Consolidated Statements of Operations.
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Revenue |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue | Revenue ASC 606, Revenue from Contracts with Customers (“ASC 606”) Under ASC 606, the Company has three separate performance obligations under its recurring software as a service agreements (“SaaS”) arrangements for point-of-sale systems provided to merchants: (1) point-of-sale software, (2) lease of hardware and (3) other support services. Disaggregated Revenue Based on similar operational characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
Based on similar economic characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
Contract Assets Contract assets of $0.2 million and $0.3 million as of June 30, 2022 and December 31, 2021, respectively, are included within “Prepaid expenses and other current assets” on the Company’s unaudited Condensed Consolidated Balance Sheets. There was no allowance for contract assets as of June 30, 2022 and December 31, 2021. Contract Liabilities The Company charges merchants for various post-contract license support/service fees and annual regulatory compliance fees. These fees typically relate to a period of one year. The Company recognizes the revenue on a straight-line basis over its respective period. As of June 30, 2022 and December 31, 2021, the Company had deferred revenue of $20.6 million and $17.4 million, respectively. The change in the contract liabilities was primarily the result of a timing difference between payment from the customer and the Company’s satisfaction of each performance obligation. The following reflects the amounts the Company recognized as annual service fees and regulatory compliance fees within “Gross revenue” in the Company’s unaudited Condensed Consolidated Statements of Operations and the amount of such fees that was included in deferred revenue at the beginning of the respective period:
Accounts Receivable The change in the Company’s allowance for doubtful accounts was as follows:
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Goodwill |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||
Goodwill | Goodwill The changes in the carrying amount of goodwill were as follows:
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Other Intangible Assets, Net |
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Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Intangible Assets, Net | Other Intangible Assets, Net Other intangible assets, net consisted of the following:
As of June 30, 2022, the estimated amortization expense for other intangible assets for each of the five succeeding years and thereafter is as follows:
Amounts charged to expense in the Company’s unaudited Condensed Consolidated Statements of Operations for amortization of other intangible assets were as follows:
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Capitalized Acquisition Costs, Net |
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Capitalized Acquisition Costs, Net [Abstract] | |||||||||||||||||||||||||||||||||||||
Capitalized Acquisition Costs, Net | Capitalized Acquisition Costs, Net Capitalized acquisition costs, net were $36.6 million and $35.1 million at June 30, 2022 and December 31, 2021, respectively, consisting of upfront processing bonuses with a gross carrying value of $73.0 million and $69.1 million less accumulated amortization of $36.4 million and $34.0 million at June 30, 2022 and December 31, 2021, respectively. Capitalized acquisition costs had a weighted average amortization period of three years at both June 30, 2022 and December 31, 2021. Amortization expense for capitalized acquisition costs was $6.6 million and $12.7 million for the three and six months ended June 30, 2022, respectively, $5.1 million and $10.1 million for the three and six months ended June 30, 2021, respectively, and is included in “Cost of sales” in the Company’s unaudited Condensed Consolidated Statements of Operations. As of June 30, 2022, the estimated future amortization expense for capitalized acquisition costs is as follows:
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Equipment for Lease, Net |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equipment for Lease, Net | Equipment for Lease, Net Equipment for lease, net consisted of the following:
The amount charged to “Depreciation and amortization expense” in the Company’s unaudited Condensed Consolidated Statements of Operations for depreciation of equipment under lease was $7.4 million and $14.4 million for the three and six months ended June 30, 2022, respectively, and $5.1 million and $9.6 million for the three and six months ended June 30, 2021, respectively.
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Property, Plant and Equipment, Net |
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Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment, net consisted of the following:
Amounts charged to expense in the Company’s unaudited Condensed Consolidated Statements of Operations for depreciation of property, plant and equipment were as follows:
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Debt |
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Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt The Company’s outstanding debt consisted of the following:
Amortization of capitalized financing fees is included in “Interest expense” in the Company’s unaudited Condensed Consolidated Statements of Operations. Amortization expense for capitalized financing fees was $2.0 million and $3.9 million for the three and six months ended June 30, 2022, respectively, and $1.2 million and $2.4 million for the three and six months ended June 30, 2021, respectively. Future principal payments As of June 30, 2022, future principal payments associated with the Company’s long-term debt were as follows:
Convertible Notes due 2025 The net carrying amount of the Convertible Senior Notes due 2025 (“2025 Convertible Notes”) was as follows:
Convertible Notes due 2027 The net carrying amount of the 0.50% Convertible Senior Notes due 2027 (“2027 Convertible Notes”) was as follows:
Senior Notes due 2026 In March 2022, Shift4 Payments, LLC (the “Issuer”) and Shift4 Payments Finance Sub, Inc. (the “Co-Issuer” and together with the Issuer, the “Issuers”), completed a consent solicitation to amend the indenture governing the $450.0 million principal amount of 4.625% Senior Notes due 2026 (“2026 Senior Notes”) to allow for the repurchase of capital stock as part of the Market Capitalization exception that had been included. In connection with the solicitation, the Company paid $4.5 million of consent payments to note holders, which was capitalized and recognized in the unaudited Condensed Consolidated Balance Sheets as a reduction of long-term debt, and incurred fees of $1.4 million, which were recorded to “Transaction-related expenses” in the unaudited Condensed Consolidated Statements of Operations in the six months ended June 30, 2022. Revolving Credit Facility Borrowing capacity on the Company’s Revolving Credit Facility under the First Lien Credit Agreement (“Revolving Credit Facility”) was $99.5 million as of June 30, 2022, net of a $0.5 million letter of credit. Restrictions and Covenants The 2025 Convertible Notes, 2026 Senior Notes, 2027 Convertible Notes (collectively, the “Notes”) and Revolving Credit Facility include certain restrictions on the ability of Shift4 Payments, LLC to make loans, advances, or pay dividends to Shift4 Payments, Inc. At June 30, 2022 and December 31, 2021, the Company was in compliance with all financial covenants. Other than as provided above, there are no significant changes to the information disclosed in the 2021 Form 10-K.
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Other Consolidated Balance Sheet Components |
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Other Consolidated Balance Sheet Components [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Consolidated Balance Sheet Components | Other Consolidated Balance Sheet Components Prepaid expenses and other current assets Prepaid expenses and other current assets consisted of the following:
Accrued expenses and other current liabilities Accrued expenses and other current liabilities consisted of the following:
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Fair Value Measurement |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurement | Fair Value Measurement U.S. GAAP defines a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted process in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The Company determines the fair values of its assets and liabilities that are recognized or disclosed at fair value in accordance with the hierarchy described below. The following three levels of inputs may be used to measure fair value: •Level 1—Quoted prices in active markets for identical assets or liabilities; •Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and •Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include items where the determination of fair value requires significant management judgment or estimation. The Company makes recurring fair value measurements of contingent liabilities arising from certain acquisitions using Level 3 unobservable inputs. These amounts relate to expected earnout payments related to the number of existing point-of-sale merchants that convert to full acquiring merchants. In conjunction with the acquisition of The Giving Block, Inc. on February 28, 2022, the Company entered into a contingent consideration agreement that requires the Company to pay up to $246.0 million if certain revenue thresholds of the acquired business are achieved for the twelve months ending February 28, 2023. The fair value of the contingent consideration was estimated using a Monte-Carlo simulation model, which included significant unobservable Level 3 inputs, such as projected financial performance over the earn-out period along with estimates for revenue volatility of 20.9% and 16.7% as of June 30, 2022 and February 28, 2022, respectively, and the discount rate of 8.5% and 7.1% as of June 30, 2022 and February 28, 2022, respectively. Changes in the volatility and discount rate were due to broader market conditions. See Note 2 for more information on the terms of the earnout agreement. The estimated fair value of the contingent consideration related to purchase consideration of $57.5 million as of June 30, 2022 is recognized in “Accrued expenses and other current liabilities” on the Company’s unaudited Condensed Consolidated Balance Sheets. The table below provides a reconciliation of the beginning and ending balances for the Level 3 contingent liabilities:
Fair value adjustments are recorded within “General and administrative expenses” in the Company’s unaudited Condensed Consolidated Statements of Operations. There were no transfers into or out of Level 3 during the six months ended June 30, 2022 and 2021. The estimated fair value of the Company’s outstanding debt using quoted prices from over-the-counter markets, considered Level 2 inputs, was as follows:
The estimated fair value of the Company’s crypto settlement assets and crypto settlement liabilities using quoted prices from active cryptocurrency exchanges, considered Level 1 inputs, was $1.2 million as of June 30, 2022. See Note 1 for more information on the Company’s crypto settlement assets and crypto settlement liabilities. Other financial instruments not measured at fair value on the Company’s unaudited Condensed Consolidated Balance Sheets at June 30, 2022 and December 31, 2021 include cash and cash equivalents, accounts receivable, prepaid expenses and other current assets, other noncurrent assets, accounts payable, and accrued expenses and other current liabilities, as their estimated fair values reasonably approximate their carrying value as reported on the Company’s unaudited Condensed Consolidated Balance Sheets.
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Income Taxes |
6 Months Ended |
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Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company holds an economic interest in Shift4 Payments, LLC and consolidates its financial position and results. The remaining ownership of Shift4 Payments, LLC not held by the Company is considered a noncontrolling interest. Shift4 Payments, LLC is treated as a partnership for income tax reporting and its members, including the Company, are liable for federal, state, and local income taxes based on their share of the LLC’s taxable income. In addition, Shift4 Corporation and VenueNext, Inc., two operating subsidiaries of Shift4 Payments, LLC, are considered C-Corporations for U.S. federal, state and local income tax purposes. Taxable income or loss from Shift4 Corporation and VenueNext Inc. is not passed through to Shift4 Payments, LLC. Instead, it is taxed at the corporate level subject to the prevailing corporate tax rates. The Company has assessed the realizability of the net deferred tax assets and in that analysis has considered the relevant positive and negative evidence available to determine whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The Company has recorded a full valuation allowance against the deferred tax assets at Shift4 Payments, Inc. as of June 30, 2022, which will be maintained until there is sufficient evidence to support the reversal of all or some portion of these allowances. The Company’s effective tax rate was 6.3% and (152.9)% for the three and six months ended June 30, 2022, respectively. The Company’s effective tax rate was (421.4)% and (9.9)% for the three and six months ended June 30, 2021, respectively. The effective tax rate for the three and six months ended June 30, 2022 was different than the U.S. federal statutory income tax rate of 21% primarily due to the loss allocated to the noncontrolling interest and the full valuation allowances on Shift4 Payments, Inc. and VenueNext, Inc. in the United States. In addition, the six months ended June 30, 2022 also includes the impact of a $6.4 million income tax benefit related to the valuation allowance release due to acquired deferred tax liabilities from The Giving Block. The effective tax rate for the three and six months ended June 30, 2021 was different than the U.S. federal statutory income tax rate of 21% primarily due to the loss allocated to the noncontrolling interest, the full valuation allowances on Shift4 Payments, Inc. and VenueNext, Inc. in the United States, the tax windfall related to vested equity-based compensation awards, and the near break-even loss before income taxes for the three months ended June 30, 2021. Tax Receivable Agreement The Company expects to obtain an increase in its share of the tax basis in the net assets of Shift4 Payments, LLC as LLC Interests are redeemed from or exchanged by Rook, at the option of the Company, determined solely by the Company’s independent directors. The Company intends to treat any redemptions and exchanges of LLC Interests as direct purchases of LLC Interests for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that it would otherwise pay in the future to various tax authorities. In connection with the Reorganization Transactions and the IPO, the Company entered into the Tax Receivable Agreement (“TRA”) with the Continuing Equity Owners. The TRA provides for the payment by Shift4 Payments, Inc. of 85% of the amount of any tax benefits the Company actually realizes, or in some cases is deemed to realize, as a result of (i) increases in the Company’s share of the tax basis in the net assets of Shift4 Payments, LLC resulting from any redemptions or exchanges of LLC Interests, (ii) tax basis increases attributable to payments made under the TRA, and (iii) deductions attributable to imputed interest pursuant to the TRA. The Company expects to benefit from the remaining 15% of any of cash savings that it realizes. The Company has not recognized a $248.3 million liability under the TRA after concluding it was not probable that such TRA Payments would be paid based on its estimates of future taxable income. No payments were made to the Continuing Equity Owners pursuant to the TRA during the three and six months ended June 30, 2022. The amounts payable under the TRA will vary depending upon a number of factors, including the amount, character, and timing of the taxable income of Shift4 Payments, Inc. in the future. If the valuation allowance recorded against the deferred tax assets applicable to the tax attributes referenced above is released in a future period, the TRA liability may be considered probable at that time and recorded within earnings. If Rook were to exchange all of its LLC Units, the Company does not expect the deferred tax asset or TRA liability to vary substantially from the amounts reported in the 2021 Form 10-K. The actual amount of deferred tax assets and related liabilities are impacted by the timing of the exchanges, the valuation of Shift4 Corporation, the price of the Company’s shares of Class A common stock at the time of the exchange, and the tax rates then in effect.
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Lease Agreements |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Lease Agreements | Lease Agreements As Lessee The Company has operating leases primarily for office space and equipment. The following amounts were recorded on the Company’s unaudited Condensed Consolidated Balance Sheets relating to operating leases:
The expected future payments related to leases with initial non-cancellable lease terms in excess of one year at June 30, 2022 were as follows:
Total operating lease expense, which is included in “General and administrative expenses” in the Company’s unaudited Condensed Consolidated Statements of Operations, was $1.4 million and $2.8 million for the three and six months ended June 30, 2022, respectively, and $1.4 million and $2.9 million for the three and six months ended June 30, 2021, respectively. Supplemental balance sheet information related to leases was as follows:
Operating lease payments included in operating cash flows were $3.0 million and $3.2 million for the six months ended June 30, 2022 and 2021, respectively. As Lessor The Company provides hardware, including terminals and point-of-sale equipment, to its merchants under operating leases. The Company’s operating leases generally include options to extend the contract for successive one-year periods. Extension options are not included in the determination of lease income unless, at lease inception, it is reasonably certain that the option will be exercised. The Company’s operating leases do not generally include purchase options. Lease payments received are recognized as income on a straight-line basis over the term of the agreement in accordance with ASC 606 and classified as gross revenue on the Company’s unaudited Condensed Consolidated Statements of Operations. Total lease income for the three and six months ended June 30, 2022 was $4.4 million and $8.7 million, respectively, and $4.2 million and $8.2 million for the three and six months ended June 30, 2021, respectively. Variable lease income was not material for the three and six months ended June 30, 2022 or 2021. The Company expects to receive future minimum lease payments for hardware provided under the Company’s SaaS agreements of $10.3 million from July 1, 2022 through June 30, 2023. See Note 3 and Note 7 for more information on the accounting for these operating leases.
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Lease Agreements | Lease Agreements As Lessee The Company has operating leases primarily for office space and equipment. The following amounts were recorded on the Company’s unaudited Condensed Consolidated Balance Sheets relating to operating leases:
The expected future payments related to leases with initial non-cancellable lease terms in excess of one year at June 30, 2022 were as follows:
Total operating lease expense, which is included in “General and administrative expenses” in the Company’s unaudited Condensed Consolidated Statements of Operations, was $1.4 million and $2.8 million for the three and six months ended June 30, 2022, respectively, and $1.4 million and $2.9 million for the three and six months ended June 30, 2021, respectively. Supplemental balance sheet information related to leases was as follows:
Operating lease payments included in operating cash flows were $3.0 million and $3.2 million for the six months ended June 30, 2022 and 2021, respectively. As Lessor The Company provides hardware, including terminals and point-of-sale equipment, to its merchants under operating leases. The Company’s operating leases generally include options to extend the contract for successive one-year periods. Extension options are not included in the determination of lease income unless, at lease inception, it is reasonably certain that the option will be exercised. The Company’s operating leases do not generally include purchase options. Lease payments received are recognized as income on a straight-line basis over the term of the agreement in accordance with ASC 606 and classified as gross revenue on the Company’s unaudited Condensed Consolidated Statements of Operations. Total lease income for the three and six months ended June 30, 2022 was $4.4 million and $8.7 million, respectively, and $4.2 million and $8.2 million for the three and six months ended June 30, 2021, respectively. Variable lease income was not material for the three and six months ended June 30, 2022 or 2021. The Company expects to receive future minimum lease payments for hardware provided under the Company’s SaaS agreements of $10.3 million from July 1, 2022 through June 30, 2023. See Note 3 and Note 7 for more information on the accounting for these operating leases.
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Related Party Transactions |
6 Months Ended |
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Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company has a service agreement with Jared Isaacman, the Company’s Chief Executive Officer and founder (“Founder”), including access to aircrafts and a property. Total expense for this service, which is included in “General and administrative expenses” in the unaudited Condensed Consolidated Statements of Operations, was $0.3 million and $0.5 million for the three and six months ended both June 30, 2022 and 2021, respectively. There were no amounts outstanding at June 30, 2022 or December 31, 2021. In the third and fourth quarters of 2021, the Company incurred $1.1 million in costs associated with a proposed Follow-on Offering that were reimbursable by Searchlight, which were included in “Accounts receivable, net” on the Company’s unaudited Condensed Consolidated Balance Sheets as of December 31, 2021. There were no amounts outstanding at June 30, 2022. In addition, on May 24, 2022, Searchlight redeemed all of its remaining LLC Interests. As a result, Searchlight is no longer a Continuing Equity Owner or a related party of the Company as of May 24, 2022. In February 2021, the Company accepted the transfer of the right to select a participant for one seat on board Inspiration4, the first all-civilian mission to space, from the Founder, who is also the commander of the mission. The right was transferred to the Company as a non-cash contribution and recorded at its estimated fair value of $2.1 million in “Additional paid-in capital” on the Company’s unaudited Condensed Consolidated Balance Sheets and expensed within “Advertising and marketing” on the Company’s unaudited Condensed Consolidated Statements of Operations in March 2021 when the participant was selected for the mission through a contest held by the Company. In the fiscal year ended December 31, 2021, the Company incurred a significant amount of nonrecurring expenses to integrate, rebrand and promote 3dcart to Shift4Shop in conjunction with the Inspiration4 announcement. Certain expenses, totaling $0.9 million, were directly associated with the Inspiration4 mission and were reimbursable by the Founder. As of December 31, 2021, a $0.1 million receivable from the Founder was recorded as “Accounts receivable” on the Company’s unaudited Condensed Consolidated Balance Sheets. There were no amounts outstanding at June 30, 2022. In March 2021, the Founder, through a wholly-owned special purpose vehicle (“SPV”), entered into a variable prepaid forward contract (“VPF Contract”) with an unaffiliated dealer (“Dealer”), covering approximately 2.0 million shares of the Company’s Class A common stock. The VPF Contract is scheduled to settle on specified dates in February, March and April 2023, at which time the actual number of shares of the Company’s Class A common stock to be delivered by the SPV will be determined based on the price of the Company’s Class A common stock on such dates relative to the forward floor price of $73.19 per share and the forward cap price of $137.24 per share, with the aggregate number not to exceed approximately 2.0 million shares, which is the number of shares of Company’s Class B common stock and LLC units pledged by Rook to secure its obligations under the contract. Subject to certain conditions, the SPV can also elect to settle the VPF Contract in cash and thereby retain full ownership of the pledged shares and units. In September 2021, the Founder, through the SPV, entered into two VPF Contracts with a Dealer, one covering approximately 2.18 million shares of the Company’s Class A common stock and the other covering approximately 2.26 million shares of the Company’s Class A common stock. The VPF Contracts are both scheduled to settle on specified dates in June, July, August and September 2024, at which time the actual number of shares of the Company’s Class A common stock to be delivered by the SPV will be determined based on the price of the Company’s Class A common stock on such dates relative to the forward floor price of approximately $66.424 per share and the forward cap price of approximately $112.09 per share for the contract covering approximately 2.18 million shares of the Company’s Class A common stock, and to the forward floor price of $66.424 per share and the forward cap price of approximately $120.39 per share for the contract covering approximately 2.26 million shares of the Company’s Class A common stock, with the aggregate number not to exceed approximately 4.44 million shares, which is the aggregate number of shares of Company’s Class B common stock and their associated common units of Shift4 Payments, LLC pledged by the SPV to secure its obligations under the contracts. Subject to certain conditions, the SPV can also elect to settle the VPF Contracts in cash and thereby retain full ownership of the pledged shares and units. If Rook were to default on its obligations under the VPF Contracts and fail to cure such default, the Dealer would have the right to exchange the pledged Class B stock and LLC interests for an equal number of the Company’s Class A common stock, and sell such Class A common stock to satisfy Rook’s obligation. In June 2022, the Company entered into a $3.6 million residual commission buyout agreement with a relative of the Founder, consisting of an initial payment of $2.5 million in cash and $0.6 million in shares of the Company’s Class A common stock, and a contingent payment of $0.5 million in cash payable after 12 months, subject to certain conditions related to the performance of the acquired assets.
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Commitments and Contingencies |
6 Months Ended |
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Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies From time to time, the Company may become involved in various lawsuits and legal proceedings, which arise, in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these, or other matters, may arise from time to time that may harm the Company’s business. In August 2021, TSYS, a Global Payments company and an important vendor to the Company, experienced a significant platform outage resulting in a payment processing service disruption that lasted for several hours. TSYS is utilized by many major credit card issuers and payment processors, which meant the impact of the outage was felt by many card accepting merchants and cardholders across the nation. The Company took steps to lessen the financial impact to its merchants and partners due to the TSYS outage and is seeking compensation through a variety of channels, including engaging with the responsible party. The Company is currently not aware of any legal proceedings or claims that the Company believes will have a material adverse effect on its business, financial condition or operating results.
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Stockholders' Equity/Members' Deficit |
6 Months Ended |
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Jun. 30, 2022 | |
Equity [Abstract] | |
Stockholders' Equity/Members' Deficit | Stockholders’ Equity/Members’ Deficit Stock Repurchases On December 16, 2021, the Company’s Board of Directors (the “Board”) authorized a stock repurchase program (the “December 2021 Program”), pursuant to which the Company was authorized to repurchase up to $100.0 million of shares of its Class A common stock through December 31, 2022. On May 11, 2022, the Board authorized a stock repurchase program (the “May 2022 Program”), pursuant to which the Company was authorized to repurchase up to an additional $100.0 million of shares of its Class A common stock through December 31, 2022, and on June 15, 2022, the Board authorized a stock repurchase program (the “June 2022 Program” and, together with the December 2021 Program and the May 2022 Program, the “Programs”), pursuant to which the Company was authorized to repurchase up to an additional $50.0 million of shares of its Class A common stock through December 31, 2022. Repurchases under the Programs may be made in the open market, in privately negotiated transactions or otherwise, with the amount and timing of repurchases depending on market conditions and corporate needs. Open market repurchases will be structured to occur within the pricing and volume requirements of Rule 10b-18. The Company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares pursuant to the Programs. The Programs do not obligate the Company to acquire any particular amount of common stock. The Programs may be extended, modified, suspended or discontinued at any time at the Company’s discretion. As of December 31, 2021, the Company had repurchased 378,475 shares of Class A common stock under the December 2021 Program for $21.1 million, including commissions paid, at an average price paid of $55.81 per share. On May 24, 2022, Searchlight exchanged its shares of the Company’s Class B and Class C common stock for an equal number of shares of Class A common stock, which Searchlight subsequently redeemed. During the six months ended June 30, 2022, the Company repurchased 3,887,191 shares of Class A common stock under the Programs for $184.4 million, including commissions paid, at an average price paid of $47.40 per share. Included in these amounts during the six months ended June 30, 2022 is the Company’s repurchase of all 967,600 shares of Searchlight’s Class A common stock for $43.1 million at an average price paid of $44.54 per share. As of June 30, 2022, approximately $44.5 million remained available for future purchases under the Programs. Repurchased shares of common stock that have not been retired are recorded as “Treasury stock” on the Company’s unaudited Condensed Consolidated Balance Sheets. Upon retirement, the Company allocates the value of treasury stock between Additional paid-in capital and Retained earnings. During the six months ended June 30, 2022, the Company retired 3,539,016 shares of common stock it had repurchased under the Programs. There were 726,650 shares of treasury stock outstanding as of June 30, 2022, which were retired on July 1, 2022.
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Noncontrolling Interests |
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Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interests | Noncontrolling Interests Shift4 Payments, Inc. is the sole managing member of Shift4 Payments, LLC, and consolidates the financial results of Shift4 Payments, LLC. The noncontrolling interests balance represents the economic interest in Shift4 Payments, LLC held by the Continuing Equity Owners. On May 24, 2022, Searchlight redeemed all of its outstanding LLC Interests and is therefore no longer a Continuing Equity Owner or a component of noncontrolling interests as of that date. The following table summarizes the ownership of LLC Interests in Shift4 Payments, LLC:
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Equity-based Compensation |
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Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity-based Compensation | Equity-based Compensation 2020 Incentive Award Plan In June 2020, the Company adopted the 2020 Incentive Award Plan (“2020 Plan”), which provides for the grant of stock options, restricted stock dividend equivalents, stock payments, restricted stock units (“RSUs”), performance restricted stock units (“PRSUs”), stock appreciation rights, and other stock or cash awards. A maximum of 418,973 shares of the Company’s Class A common stock is available for issuance under the 2020 Plan. The number of shares available for issuance is subject to an annual increase on the first day of each year beginning in 2021 and ending in and including 2030, equal to the lesser of (1) 1% of the shares outstanding (on an as-converted basis, taking into account any and all securities convertible into, or exercisable, exchangeable or redeemable for, shares of Class A common stock (including LLC Interests of Shift4 Payments, LLC)) on the last day of the immediately preceding fiscal year and (2) such smaller number of shares as determined by the Board. On April 28, 2022, the Board adopted, and on June 10, 2022, the Company’s shareholders approved, the amendment and restatement of the Shift4 Payments, Inc. 2020 Incentive Award Plan (the “Restated Equity Plan”). The Restated Equity Plan (a) increased the number of shares of the Company’s Class A common stock available for issuance under the Restated Equity Plan to a total of 7,500,000 shares, (b) increased the annual “evergreen” increase to the number of shares of the Company’s Class A common stock available for issuance under the Restated Equity Plan from 1% of the shares outstanding to 2% of the shares outstanding, (c) limited the number of shares of the Company’s Class A common stock that may be issued upon the exercise of incentive stock options to no more than 7,500,000 shares, and (d) extended the term of the Restated Equity Plan to ten years from the date it was adopted by the Board. RSUs and PRSUs RSUs represent the right to receive shares of the Company’s Class A common stock at a specified date in the future. The RSU activity for the six months ended June 30, 2022 was as follows:
The grant date fair value of RSUs and PRSUs subject to continued service or those that vest immediately was determined based on the price of the Company’s Class A common stock on the grant date. The Company recognized equity-based compensation expense of $9.3 million and $26.2 million for the three and six months ended June 30, 2022, respectively, and $6.6 million and $20.6 million for the three and six months ended June 30, 2021, respectively. At June 30, 2022, the total unrecognized equity-based compensation expense related to outstanding RSUs and PRSUs was $92.9 million, which is expected to be recognized over a weighted-average period of 3.33 years.
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Basic and Diluted Net Income (Loss) per Share |
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Basic and Diluted Net Income (Loss) per Share | Basic and Diluted Net Income (Loss) per Share Basic net income (loss) per share has been computed by dividing net income (loss) attributable to common shareholders by the weighted average number of shares of common stock outstanding for the same period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period in which the shares were outstanding. Diluted net income (loss) per share has been computed in a manner consistent with that of basic net income (loss) per share while giving effect to all shares of potentially dilutive common stock that were outstanding during the period. The following table presents the calculation of basic and diluted net income (loss) per share under the two-class method:
The following were excluded from the calculation of diluted net income (loss) per share as the effect would be anti-dilutive:
For the three and six months ended June 30, 2022, the Company has excluded from the calculation of diluted net income per share the effect of the conversion of the 2025 Convertible Notes and 2027 Convertible Notes, as the last reported sales price of the Company’s Class A common stock was not greater than or equal to 130% of the conversion price for 20 trading days during a period of 30 consecutive trading days prior to June 30, 2022, per the terms of the agreement. For the six months ended June 30, 2021, the Company has excluded from the calculation of diluted net income (loss) per share the effect of the conversion of the 2025 Convertible Notes, as the last reported sales price of the Company’s Class A common stock was not greater than or equal to 130% of the conversion price for 20 trading days during a period of 30 consecutive trading days prior to June 30, 2021, per the terms of the agreement. The Company will pay in cash the $690.0 million principal of the 2025 Convertible Notes and the $632.5 million principal of the 2027 Convertible Notes with any excess to be paid or delivered in cash or shares of the Company’s Class A common stock or a combination of both at the Company’s election. In addition, for the three and six months ended June 30, 2022, the Company has excluded from the calculation of diluted net income per share the effect of shares of the Company’s Class A common stock to be issued in connection with the earnout due to the former shareholders of The Giving Block. The earnout will be calculated as a multiple of revenue earned by The Giving Block from March 1, 2022 to February 28, 2023, not to exceed $246.0 million in total, of which 75% will be paid in a combination of RSUs and shares of the Company’s Class A common stock. See Note 2 for more information.
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Supplemental Cash Flow Information |
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Supplemental Cash Flow Information | Supplemental Cash Flows Information Supplemental cash flows disclosures and noncash information consisted of the following:
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Segments |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segments | Segments Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”) for the purposes of allocating resources and evaluating financial performance. The Company’s CODM is the chief executive officer, who reviews financial information on a consolidated level for purposes of allocating resources and evaluating financial performance, and as such, the Company’s operations constitute one operating segment and one reportable segment. The following table summarizes gross revenue by revenue type:
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Subsequent Events |
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Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Acquisitions and Investments Subsequent to June 30, 2022, the Company acquired three technology vendors for approximately $56.8 million of total purchase consideration, comprised of a combination of cash and shares of the Company’s Class A common stock. Due to the timing of these acquisitions, the initial accounting for the acquisitions, including the valuation of assets and liabilities acquired, is incomplete. As such, the Company is unable to disclose certain information, including the preliminary fair value of assets acquired and liabilities assumed, at this time. In addition, subsequent to June 30, 2022, the Company committed approximately $120.0 million, comprised of a combination of cash and shares of the Company’s Class A common stock, to acquire ongoing merchant relationships and secure non-solicitation rights from third-party distribution partners. Departure of Bradley Herring and Appointment of Nancy Disman as Chief Financial Officer On August 3, 2022, Bradley Herring and the Company agreed that Mr. Herring will no longer serve as the Company’s Chief Financial Officer, effective August 5, 2022. In connection with Mr. Herring’s resignation, the Company entered into a separation and release of claims agreement with Mr. Herring on August 3, 2022. On August 3, 2022, Nancy Disman tendered her resignation as a Class II director of the Board and stepped down from the Board and its Audit, Compensation and Nominating and Corporate Governance Committees, in each case effective August 5, 2022. On August 3, 2022, the Board appointed Ms. Disman as the Company’s Chief Financial Officer and principal financial officer, in each case effective August 5, 2022, (the “Transition Date”). In connection with Ms. Disman’s appointment as the Chief Financial Officer, the Company entered into an employment agreement (the “Employment Agreement”) with Ms. Disman on August 3, 2022, effective the Transition Date. The Employment Agreement provides for an initial three-year term of employment with automatic one-year renewal terms unless otherwise terminated in accordance with the terms of the Employment Agreement. Realignment of Board Classification On August 3, 2022, in accordance with the Company’s amended and restated bylaws, the Board decreased the size of the Board to six members and, in order to achieve an equal balance of membership among the classes of directors, determined to move Christopher N. Cruz from Class III with a term expiring at the 2023 Annual Meeting of Stockholders to Class II with a term expiring at the 2025 Annual Meeting of Stockholders, in each case effective August 5, 2022. Accordingly, on the same date, Mr. Cruz, who was a Class III director, resigned as a director and was immediately elected by the Board as a Class II director. The resignation and re-election of Mr. Cruz was effected solely to rebalance the Board's classes and, for all other purposes, including compensation, Mr. Cruz’s service on the Board is deemed to have continued uninterrupted. The Board now consists of two Class I directors, two Class II directors and two Class III directors. The current Class I Directors are now Karen Roter Davis and Jared Isaacman; the current Class II Directors are Christopher Cruz and Sarah Goldsmith-Grover; and the current Class III Directors are Jonathan Halkyard and Donald Isaacman.
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Organization, Basis of Presentation and Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim condensed consolidated financial statements of the Company are unaudited. These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial information. As such, these financial statements do not include all information and footnotes required by U.S. GAAP for complete financial statements. The December 31, 2021 Condensed Consolidated Balance Sheet was derived from audited financial statements as of that date, but does not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments consisting only of normal recurring adjustments necessary to state fairly the financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP applicable to interim periods. The results of operations for the interim periods presented are not necessarily indicative of results for the full year or future periods. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto as of and for the fiscal year ended December 31, 2021, as disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (the “2021 Form 10-K”). The unaudited condensed consolidated financial statements include the accounts of Shift4 Payments, Inc. and its wholly-owned subsidiaries. Shift4 Payments, Inc. consolidates the financial results of Shift4 Payments, LLC, which is considered a variable interest entity (“VIE”). Shift4 Payments, Inc. is the primary beneficiary and sole managing member of Shift4 Payments, LLC and has decision making authority that significantly affects the economic performance of the entity. As a result, the Company consolidates Shift4 Payments, LLC and reports a noncontrolling interest representing the economic interest in Shift4 Payments, LLC held by Rook Holdings Inc. (“Rook”). Prior to May 24, 2022, the noncontrolling interest also included the economic interest in Shift4 Payments, LLC held by certain affiliates of Searchlight Capital Partners (“Searchlight”) (together with Rook, the “Continuing Equity Owners”). All intercompany balances and transactions have been eliminated in consolidation. The assets and liabilities of Shift4 Payments, LLC represent substantially all of the consolidated assets and liabilities of Shift4 Payments, Inc. with the exception of certain cash balances, contingent consideration for earnout liabilities for The Giving Block, Inc. (“The Giving Block”), and the aggregate principal amount of $690.0 million of 2025 Convertible Notes and $632.5 million of 2027 Convertible Notes that are held by Shift4 Payments, Inc. directly. As of both June 30, 2022 and December 31, 2021, $9.8 million of cash was held by Shift4 Payments, Inc. As of June 30, 2022, the earnout liabilities for The Giving Block were $58.9 million. Shift4 Payments, Inc., which was established November 5, 2019, has not had any material operations on a standalone basis since its inception, and all of the operations of the Company are carried out by Shift4 Payments, LLC and its subsidiaries. Certain prior year balances have been adjusted to present contract assets within the line item “Prepaid expenses and other current assets” rather than in its own line item on the Company’s unaudited Condensed Consolidated Balance Sheets.
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Liquidity and Managements Plan | Liquidity and Management’s Plan As of June 30, 2022, the Company had $1,772.5 million total principal amount of debt outstanding and was in compliance with the financial covenants under its debt agreements. The Company expects to be in compliance for at least 12 months following issuance of these unaudited condensed consolidated financial statements. See Note 9 for further information on the Company’s debt obligations.
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Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Significant estimates inherent in the preparation of the accompanying unaudited condensed consolidated financial statements include estimates of fair value of acquired assets and liabilities through business combinations, fair value of contingent liabilities related to earnout payments, fair value of debt instruments, allowance for doubtful accounts, income taxes, investments in securities and noncontrolling interests. Estimates are based on past experience and other considerations reasonable under the circumstances. Actual results may differ from these estimates.
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Significant Accounting Policies | Significant Accounting Policies The Company’s significant accounting policies are discussed in Note 2 to Shift4 Payments, Inc.’s consolidated financial statements as of and for the year ended December 31, 2021 in the 2021 Form 10-K. There have been no significant changes to these policies which have had a material impact on the Company’s unaudited condensed consolidated financial statements and related notes during the six months ended June 30, 2022 except for the below.
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Crypto Settlement Assets and Liabilities | Crypto Settlement Assets and Liabilities The Company recognizes a liability accompanied by an asset of the same value to reflect its obligation to safeguard the crypto settlement assets it holds on behalf of users of The Giving Block’s platform. These crypto settlement assets are comprised of numerous cryptocurrencies that are traded on numerous cryptocurrency exchanges. The liability and asset are remeasured at each reporting date at the fair value of the crypto settlement assets, which is determined using quoted prices from cryptocurrency exchanges. The Company’s agent, which acts as a cryptocurrency exchange and custodian, holds the cryptographic key information of the crypto settlement assets and is primarily obligated to secure the assets and protect them from loss or theft. The Company maintains the internal recordkeeping of the assets.
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Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Pronouncements Adopted In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Codification (“ASC”) 842, Leases (“ASC 842”) with amendments in 2018 and 2019. This accounting guidance requires a lessee to record assets and liabilities on the balance sheet for the rights and obligations arising from leases with terms of more than 12 months. On January 1, 2021, the Company adopted ASC 842 using the modified retrospective method, reflecting the adoption in the Company’s annual results for the period ended December 31, 2021. Prior period amounts were not adjusted and continue to be reported in accordance with historic accounting under previous lease guidance, ASC 840, Leases (“ASC 840”). The Company elected to use the package of practical expedients permitted under the transition guidance. The Company did not reassess (i) whether any expired or existing contracts are or contain leases, (ii) the lease classification for any expired or existing leases, or (iii) initial direct costs for any existing leases. For lease agreements where the Company is a lessee that include lease and non-lease components, the Company elected to use the practical expedient on all leases entered into or modified after January 1, 2021 to combine lease and non-lease components for all classes of assets. Additionally, the Company elected to not record leases with a term of twelve months or less on the balance sheet. Upon adoption, the Company recorded right-of-use assets of $21.4 million and lease liabilities of $25.7 million. The adoption of ASC 842 did not result in a material impact to the unaudited Condensed Consolidated Statements of Operations or unaudited Condensed Consolidated Statements of Cash Flows. See Note 13 for ASC 842-related disclosures. In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326), which changes the impairment model for most financial assets, including accounts receivable, and replaces the existing incurred loss impairment model with a current expected credit loss (“CECL”) methodology, which will result in more timely recognition of credit losses. The Company adopted ASU 2016-13 on a modified retrospective basis on December 31, 2021, reflecting the adoption as of January 1, 2021 in the Company's annual results for the period ended December 31, 2021 and interim periods beginning January 1, 2022. The adoption of ASU 2016-13 did not result in a material impact on the Company’s unaudited condensed consolidated financial statements and disclosures. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires an acquirer to account for revenue contracts acquired in a business combination in accordance with ASC 606, as if it had originated the contracts. Prior to ASU 2021-08, an acquirer generally recognized assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts with customers and other similar contracts, at fair value on the acquisition date. The Company adopted ASU 2021-08 in the third quarter of 2021 and retrospectively applied the ASU to its acquisitions that occurred in 2021. The adoption of ASU 2021-08 resulted in an increase to “Deferred revenue” of $5.7 million, of which $1.8 million was recognized as an increase to “Gross revenue” for the fiscal year ended December 31, 2021. In July 2021, the FASB issued ASU 2021-05, Lessors—Certain Leases with Variable Lease Payments, to amend lessor accounting for certain leases with variable lease payments that do not depend on a reference index or a rate and would have resulted in the recognition of a loss at lease commencement if classified as a sales-type or a direct financing lease. ASU 2021-05 amends the classification requirements of such leases for lessors to require operating lease classification. The Company adopted ASU 2021-05 on a retrospective basis effective January 1, 2022. The adoption did not have a significant impact on the Company’s unaudited condensed consolidated financial statements. In March 2022, the SEC issued Staff Accounting Bulletin No. 121 (“SAB 121”), which provided interpretive guidance regarding the accounting for obligations to safeguard crypto-assets an entity holds for users of its crypto platform. This guidance requires entities that hold crypto-assets on behalf of platform users to recognize a liability accompanied by an asset of the same value on its balance sheet to reflect the entity’s obligation to safeguard the crypto-assets held for its platform users. The liability and asset should be measured at initial recognition and each reporting date at the fair value of the crypto-assets that the entity is responsible for holding for its platform users. The entity should also describe in the footnotes to the financial statements the nature and amount of crypto-assets the entity is responsible for safeguarding for its platform users and how the fair value is determined, and should also consider including information regarding who (e.g. the entity, its agent, or another third party) holds the cryptographic key information, maintains the internal recordkeeping of those assets, and is obligated to secure the assets and protect them from loss or theft. This guidance is effective from the first interim period after June 15, 2022 and should be applied retrospectively. The Company adopted SAB 121 on a retrospective basis effective June 30, 2022, resulting in the recognition of $1.2 million of crypto settlement assets within “Prepaid expenses and other current assets” and $1.2 million of crypto settlement liabilities within “Accrued expenses and other current liabilities” on the Company’s unaudited Condensed Consolidated Balance Sheets as of June 30, 2022 associated with The Giving Block. The adoption of this guidance had no impact on the Company’s unaudited Condensed Consolidated Statements of Operations and unaudited Condensed Consolidated Statements of Cash Flows. Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform, which provides optional expedients and exceptions for applying U.S. GAAP to contract modifications and hedging relationships, subject to certain criteria, that reference the London Interbank Offered Rate (“LIBOR”), or another reference rate that is expected to be discontinued. Companies may elect to apply these amendments through December 31, 2022. The Company is currently evaluating whether we will elect the optional expedients, as well as evaluating the impact of ASU 2020-04 on the Company’s unaudited condensed consolidated financial statements.
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Acquisitions (Tables) |
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combination and Asset Acquisition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Purchase Price Included the Forms of Consideration | Total purchase consideration was as follows:
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Schedule of Assets Acquired and Liabilities Assumed | The following table summarizes the fair value assigned to the assets acquired and liabilities assumed at the acquisition date. These amounts reflect various preliminary fair value estimates and assumptions, and are subject to change within the measurement period as valuations are finalized. The primary areas of preliminary purchase price allocation subject to change relate to the valuation of contingent consideration, accrued expenses and other current liabilities assumed, and residual goodwill.
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Revenue (Tables) |
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Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disaggregation of Revenue | Based on similar operational characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
Based on similar economic characteristics, the Company’s revenue from contracts with customers is disaggregated as follows:
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Summary of Annual Service Fees and Regulatory Compliance Fees | The following reflects the amounts the Company recognized as annual service fees and regulatory compliance fees within “Gross revenue” in the Company’s unaudited Condensed Consolidated Statements of Operations and the amount of such fees that was included in deferred revenue at the beginning of the respective period:
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Schedule of Changes in Allowance for Doubtful Accounts | The change in the Company’s allowance for doubtful accounts was as follows:
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Goodwill (Tables) |
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Jun. 30, 2022 | |||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill were as follows:
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Other Intangible Assets, Net (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Intangible Assets, Net | Other intangible assets, net consisted of the following:
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Schedule of Estimated Amortization Expense for Intangible Assets | As of June 30, 2022, the estimated amortization expense for other intangible assets for each of the five succeeding years and thereafter is as follows:
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Schedule of Amounts Charged to Expense in Amortization of Intangible Assets | Amounts charged to expense in the Company’s unaudited Condensed Consolidated Statements of Operations for amortization of other intangible assets were as follows:
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Capitalized Acquisition Costs, Net (Tables) |
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||
Capitalized Acquisition Costs, Net [Abstract] | |||||||||||||||||||||||||||||||||||||
Summary of Estimated Future Amortization Expense for Capitalized Acquisition Costs | As of June 30, 2022, the estimated future amortization expense for capitalized acquisition costs is as follows:
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Equipment for Lease, Net (Tables) |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Equipment for Lease, Net | Equipment for lease, net consisted of the following:
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Property, Plant and Equipment, Net (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant and Equipment [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Property, Plant and Equipment, Net | Property, plant and equipment, net consisted of the following:
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Summary of Amounts Charged to Expense in the Unaudited Condensed Consolidated Statements of Operations for Depreciation | Amounts charged to expense in the Company’s unaudited Condensed Consolidated Statements of Operations for depreciation of property, plant and equipment were as follows:
|
Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Outstanding Debt | The Company’s outstanding debt consisted of the following:
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Schedule of Maturities of Long-term Debt | As of June 30, 2022, future principal payments associated with the Company’s long-term debt were as follows:
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Summary of Net Carrying Amount of Convertible Notes | The net carrying amount of the Convertible Senior Notes due 2025 (“2025 Convertible Notes”) was as follows:
The net carrying amount of the 0.50% Convertible Senior Notes due 2027 (“2027 Convertible Notes”) was as follows:
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Other Consolidated Balance Sheet Components (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Consolidated Balance Sheet Components [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consisted of the following:
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Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consisted of the following:
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Fair Value Measurement (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reconciliation of Beginning and Ending Balances for Level 3 Contingent Liabilities | The table below provides a reconciliation of the beginning and ending balances for the Level 3 contingent liabilities:
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Summary of Estimated Fair Value | The estimated fair value of the Company’s outstanding debt using quoted prices from over-the-counter markets, considered Level 2 inputs, was as follows:
|
Lease Agreements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets and Liabilities, Lessee | The following amounts were recorded on the Company’s unaudited Condensed Consolidated Balance Sheets relating to operating leases:
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Summary of Expected Payments Related to Non-cancellable Lease Terms | The expected future payments related to leases with initial non-cancellable lease terms in excess of one year at June 30, 2022 were as follows:
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Operating Lease Costs | Supplemental balance sheet information related to leases was as follows:
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Noncontrolling Interests (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Noncontrolling Interest [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Ownership of LLC Interests | The following table summarizes the ownership of LLC Interests in Shift4 Payments, LLC:
|
Equity-based Compensation (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of RSU Activity | The RSU activity for the six months ended June 30, 2022 was as follows:
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Basic and Diluted Net Income (Loss) per Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Calculation of Basic and Diluted Net Loss Per Share | Basic net income (loss) per share has been computed by dividing net income (loss) attributable to common shareholders by the weighted average number of shares of common stock outstanding for the same period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period in which the shares were outstanding. Diluted net income (loss) per share has been computed in a manner consistent with that of basic net income (loss) per share while giving effect to all shares of potentially dilutive common stock that were outstanding during the period. The following table presents the calculation of basic and diluted net income (loss) per share under the two-class method:
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Schedule of Calculation of Diluted Net Loss Per Share as the Effect Would be Anti-dilutive | The following were excluded from the calculation of diluted net income (loss) per share as the effect would be anti-dilutive:
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Supplemental Cash Flow Information (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Information [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Supplemental Cash Flows and Noncash Information | Supplemental cash flows disclosures and noncash information consisted of the following:
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Segments (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2022 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Gross Revenue by Revenue | The following table summarizes gross revenue by revenue type:
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Acquisitions - Schedule of Purchase Price Included the Forms of Consideration (Details) - USD ($) $ in Millions |
6 Months Ended | |
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Feb. 28, 2022 |
Jun. 30, 2022 |
|
The Giving Block | ||
Business Acquisition [Line Items] | ||
Contingent consideration | $ 57.8 | $ 57.5 |
Total purchase consideration | 111.1 | |
Less: cash acquired | (4.2) | |
Total purchase consideration, net of cash acquired | $ 106.9 | |
Business acquisition, number of shares issued (in shares) | 785,969 | |
Contingent consideration, maximum earnout | $ 246.0 | |
Contingent consideration, equity interests issued and issuable, earnout percentage | 75.00% | |
Contingent consideration, cash, earnout percentage | 25.00% | |
Acquisition cost expensed | $ 1.4 | |
The Giving Block | RSUs | ||
Business Acquisition [Line Items] | ||
RSUs granted for fair value of equity-based compensation awards | $ 0.1 | |
The Giving Block | Class A Common Stock | ||
Business Acquisition [Line Items] | ||
Shares of Class A common stock | 36.4 | |
Postec | ||
Business Acquisition [Line Items] | ||
Cash | $ 16.8 |
Acquisitions - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Feb. 28, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Business Acquisition [Line Items] | |||
Prepaid expenses and other current assets | $ 4.8 | ||
Goodwill | $ 627.1 | $ 537.7 | |
Accrued expenses and other current liabilities | (4.9) | ||
Crypto settlement assets | 1.2 | 4.8 | 0.0 |
Crypto settlement liabilities | $ 1.2 | 4.8 | $ 0.0 |
The Giving Block | |||
Business Acquisition [Line Items] | |||
Other intangible assets | 26.0 | ||
Goodwill | 89.4 | ||
Deferred revenue | (2.0) | ||
Deferred tax liability | (6.4) | ||
Net assets acquired | $ 106.9 |
Revenue - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Disaggregation Of Revenue [Line Items] | ||||
Revenue from contracts with customers | $ 506.7 | $ 351.0 | $ 908.6 | $ 590.3 |
Over-time revenue | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue from contracts with customers | 495.0 | 341.1 | 887.0 | 571.3 |
Point-in-time revenue | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue from contracts with customers | 11.7 | 9.9 | 21.6 | 19.0 |
Payments-based revenue | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue from contracts with customers | 473.9 | 324.8 | 845.4 | 540.7 |
Subscription and other revenues | ||||
Disaggregation Of Revenue [Line Items] | ||||
Revenue from contracts with customers | $ 32.8 | $ 26.2 | $ 63.2 | $ 49.6 |
Revenue - Narrative (Details) - USD ($) |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Dec. 31, 2021 |
|
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 200,000 | $ 300,000 |
Allowance for contract assets | $ 0 | 0 |
Fee recognition period | 1 year | |
Deferred revenue | $ 20,600,000 | $ 17,400,000 |
Revenue - Summary of Annual Service Fees and Regulatory Compliance Fees (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Disaggregation Of Revenue [Line Items] | ||||
Gross revenue | $ 506.7 | $ 351.0 | $ 908.6 | $ 590.3 |
Annual service fees and regulatory compliance fees | ||||
Disaggregation Of Revenue [Line Items] | ||||
Gross revenue | 10.0 | 5.7 | 19.6 | 10.1 |
Amount of these fees included in deferred revenue at beginning of period | ||||
Disaggregation Of Revenue [Line Items] | ||||
Gross revenue | $ 8.5 | $ 4.6 | $ 8.8 | $ 4.0 |
Revenue - Schedule of Changes in Allowance for Doubtful Accounts (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ 8.0 | $ 5.7 |
Additions to expense | 4.3 | 8.1 |
Write-offs, net of recoveries and other adjustments | (1.5) | (1.0) |
Ending balance | 10.8 | 12.8 |
Additions to expense | $ 4.3 | 8.1 |
Cost of sales | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Additions to expense | 5.5 | |
Additions to expense | $ 5.5 |
Goodwill (Details) $ in Millions |
6 Months Ended |
---|---|
Jun. 30, 2022
USD ($)
| |
Goodwill [Roll Forward] | |
Balance at December 31, 2021 | $ 537.7 |
Balance at June 30, 2022 | 627.1 |
The Giving Block | |
Goodwill [Roll Forward] | |
Acquisition during period | $ 89.4 |
Other Intangible Assets, Net - Schedule of Estimated Amortization Expense for Intangible Assets (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2022 (remaining six months) | $ 27.4 | |
2023 | 50.8 | |
2024 | 45.2 | |
2025 | 29.2 | |
2026 | 17.6 | |
Thereafter | 48.8 | |
Net Carrying Value | $ 219.0 | $ 188.5 |
Other Intangible Assets, Net - Schedule of Amounts Charged to Expense in Amortization of Intangible Assets (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Finite Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ 14.7 | $ 14.1 | $ 29.4 | $ 28.7 |
Depreciation and amortization expense | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | 8.4 | 9.4 | 17.7 | 19.5 |
Cost of sales | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ 6.3 | $ 4.7 | $ 11.7 | $ 9.2 |
Capitalized Acquisition Costs, Net - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Dec. 31, 2021 |
|
Capitalized Contract Cost [Line Items] | |||||
Capitalized acquisition cost, net | $ 36.6 | $ 36.6 | $ 35.1 | ||
Capitalized acquisition cost, gross carrying value | 73.0 | 73.0 | 69.1 | ||
Capitalized acquisition cost, accumulated amortization | $ 36.4 | $ 36.4 | $ 34.0 | ||
Capitalized acquisition costs, weighted average amortization period | 3 years | 3 years | 3 years | ||
Cost of sales | |||||
Capitalized Contract Cost [Line Items] | |||||
Capitalized acquisition cost, amortization expense | $ 6.6 | $ 5.1 | $ 12.7 | $ 10.1 |
Capitalized Acquisition Costs, Net - Summary of Estimate Future Amortization Expense for Capitalized Acquisition Costs (Details) $ in Millions |
Jun. 30, 2022
USD ($)
|
---|---|
Capitalized Acquisition Costs, Net [Abstract] | |
2022 (remaining six months) | $ 11.1 |
2023 | 16.4 |
2024 | 8.2 |
2025 | 0.9 |
Total | $ 36.6 |
Equipment for Lease, Net - Schedule of Equipment for Lease, Net (Details) - USD ($) $ in Millions |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2022 |
Dec. 31, 2021 |
|
Operating Leased Assets [Line Items] | ||
Carrying Value | $ 100.1 | $ 82.6 |
Accumulated Depreciation | (34.9) | (24.2) |
Net Carrying Value | $ 65.2 | $ 58.4 |
Equipment under lease | ||
Operating Leased Assets [Line Items] | ||
Weighted Average Depreciation Period | 3 years | 3 years |
Carrying Value | $ 89.8 | $ 72.9 |
Accumulated Depreciation | (34.9) | (24.2) |
Net Carrying Value | 54.9 | 48.7 |
Equipment held for lease | ||
Operating Leased Assets [Line Items] | ||
Carrying Value | 10.3 | 9.7 |
Accumulated Depreciation | 0.0 | 0.0 |
Net Carrying Value | $ 10.3 | $ 9.7 |
Equipment for Lease, Net - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Leases [Abstract] | ||||
Depreciation and amortization expenses of equipment | $ 7.4 | $ 5.1 | $ 14.4 | $ 9.6 |
Property, Plant and Equipment, Net - Summary of Property, Plant and Equipment, Net (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 27.0 | $ 27.0 |
Less: Accumulated depreciation | (9.3) | (8.6) |
Total property, plant and equipment, net | 17.7 | 18.4 |
Equipment | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 11.6 | 10.5 |
Capitalized software | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 4.1 | 5.1 |
Leasehold improvements | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 9.4 | 9.1 |
Furniture and fixtures | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | 1.7 | 2.0 |
Vehicles | ||
Property Plant and Equipment [Line Items] | ||
Total property, plant and equipment, gross | $ 0.2 | $ 0.3 |
Property, Plant and Equipment, Net - Summary of Amounts Charged to Expense in the Unaudited Condensed Consolidated Statements of Operations for Depreciation (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Property Plant and Equipment [Line Items] | ||||
Depreciation and amortization expense | $ 16.7 | $ 15.5 | $ 34.0 | $ 30.9 |
Cost of sales | 0.3 | 0.4 | 0.6 | 0.8 |
Total depreciation expense | 1.2 | 1.4 | 2.5 | 2.6 |
Depreciation and amortization expense | ||||
Property Plant and Equipment [Line Items] | ||||
Depreciation and amortization expense | $ 0.9 | $ 1.0 | $ 1.9 | $ 1.8 |
Debt - Summary of Outstanding Debt (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Dec. 31, 2021 |
|
Debt Instrument [Line Items] | ||
Total borrowings | $ 1,772.5 | $ 1,772.5 |
Less: Unamortized capitalized financing fees | (34.7) | (34.0) |
Total long-term debt | $ 1,737.8 | 1,738.5 |
Convertible Notes Due 2025 | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 0.49% | |
Total borrowings | $ 690.0 | 690.0 |
2027 Convertible Notes | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 0.90% | |
Total borrowings | $ 632.5 | 632.5 |
2026 Senior Notes | ||
Debt Instrument [Line Items] | ||
Effective Interest Rate | 5.13% | |
Total borrowings | $ 450.0 | $ 450.0 |
Debt - Narrative (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
Oct. 31, 2020 |
|
Debt Instrument [Line Items] | |||||
Amortization of capitalized financing fees | $ 2,000,000 | $ 1,200,000 | $ 3,900,000 | $ 2,400,000 | |
Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | 99,500,000 | 99,500,000 | |||
Standby Letter of Credit | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | 500,000 | 500,000 | |||
Convertible Notes Due 2025 | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | 690,000,000 | 690,000,000 | |||
4.625% Senior Notes Due 2026 | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 450,000,000 | ||||
Debt instrument, interest rate, stated percentage | 4.625% | ||||
Debt instrument, capitalized amount | 4,500,000 | 4,500,000 | |||
Debt instrument, fee amount | $ 1,400,000 | $ 1,400,000 |
Debt - Schedule of Maturities of Long-term Debt (Details) $ in Millions |
Jun. 30, 2022
USD ($)
|
---|---|
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2025 | $ 690.0 |
2026 | 450.0 |
2027 | 632.5 |
Net carrying value | $ 1,772.5 |
Debt - Summary of Net Carrying Amount of Convertible Notes (Details) - USD ($) |
Jun. 30, 2022 |
Dec. 31, 2021 |
Jul. 31, 2021 |
---|---|---|---|
Debt Instrument [Line Items] | |||
Unamortized debt issuance costs | $ (34,700,000) | $ (34,000,000.0) | |
Net carrying value | 1,772,500,000 | ||
Convertible Notes Due 2025 | |||
Debt Instrument [Line Items] | |||
Principal outstanding | 690,000,000 | ||
Convertible Notes Due 2025 | Convertible Debt | |||
Debt Instrument [Line Items] | |||
Principal outstanding | 690,000,000.0 | 690,000,000.0 | |
Unamortized debt issuance costs | (11,300,000) | (13,000,000.0) | |
Net carrying value | 678,700,000 | 677,000,000.0 | |
2027 Convertible Notes | Convertible Debt | |||
Debt Instrument [Line Items] | |||
Principal outstanding | 632,500,000 | 632,500,000 | |
Unamortized debt issuance costs | (12,800,000) | (13,800,000) | |
Net carrying value | $ 619,700,000 | $ 618,700,000 | |
Debt instrument, interest rate, stated percentage | 0.50% |
Other Consolidated Balance Sheet Components - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Feb. 28, 2022 |
Dec. 31, 2021 |
---|---|---|---|
Other Consolidated Balance Sheet Components [Abstract] | |||
Crypto settlement assets | $ 1.2 | $ 4.8 | $ 0.0 |
Prepaid insurance | 0.9 | 3.3 | |
Prepaid merchant signing bonuses | 0.2 | 0.7 | |
Other prepaid expenses | 7.2 | 6.1 | |
Taxes receivable | 1.7 | 1.8 | |
Contract assets | 0.2 | 0.3 | |
Agent and employee loan receivables | 0.1 | 0.2 | |
Other current assets | 0.6 | 0.3 | |
Total prepaid expenses and other current assets | $ 12.1 | $ 12.7 |
Other Consolidated Balance Sheet Components - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Millions |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2022 |
Feb. 28, 2022 |
Dec. 31, 2021 |
|
Business Acquisition [Line Items] | |||
Residuals payable | $ 17.0 | $ 13.1 | |
Accrued interest | 4.8 | 4.8 | |
Accrued payroll | 5.6 | 15.3 | |
Taxes payable | 2.1 | 1.6 | |
Deferred employer social security tax pursuant to the CARES Act | 1.6 | 1.6 | |
Crypto settlement liabilities | 1.2 | $ 4.8 | 0.0 |
Restructuring accrual | 0.7 | 1.5 | |
Other current liabilities | 5.4 | 5.0 | |
Total accrued expenses and other current liabilities | 97.3 | 42.9 | |
Severance payments | 0.9 | ||
The Giving Block | |||
Business Acquisition [Line Items] | |||
Contingent liability earnout | 58.9 | $ 0.0 | |
Contingent consideration | 57.5 | $ 57.8 | |
Acquisition cost expensed | $ 1.4 |
Fair Value Measurement - Narrative (Details) $ in Millions |
Jun. 30, 2022
USD ($)
|
Feb. 28, 2022
USD ($)
|
Dec. 31, 2021
USD ($)
|
---|---|---|---|
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Crypto settlement assets | $ 1.2 | $ 4.8 | $ 0.0 |
Price Volatility | |||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Measurement input | 0.209 | 0.167 | |
Discount Rate | |||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Measurement input | 0.085 | 0.071 | |
The Giving Block | |||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Contingent consideration arrangements, maximum | $ 246.0 | ||
Contingent consideration | $ 57.5 | $ 57.8 |
Fair Value Measurement - Reconciliation of Beginning and Ending Balances for Level 3 Contingent Liabilities (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Contingent consideration for The Giving Block acquisition | $ (0.3) | $ 0.2 |
Significant Observable Inputs (Level 3) | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | 0.0 | 0.0 |
Contingent consideration for The Giving Block acquisition | 57.8 | 0.0 |
Fair value adjustments | (0.3) | 0.2 |
Balance at end of period | 57.5 | 0.0 |
Significant Observable Inputs (Level 3) | Earnout Payments | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Cash payments made for contingent liabilities related to earnout payments | $ 0.0 | $ (0.2) |
Income Taxes (Details) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022
USD ($)
|
Jun. 30, 2021 |
Jun. 30, 2022
USD ($)
subsidiary
|
Jun. 30, 2021 |
|
Income Tax Disclosure [Abstract] | ||||
Number of operating subsidiaries | subsidiary | 2 | |||
Effective tax rate | 6.30% | (421.40%) | (152.90%) | (9.90%) |
Tax benefit of net operating loss carryback allowed due to CARES Act | $ 6.4 | |||
Tax receivable agreement realized tax benefit percentage | 85.00% | |||
Tax receivable agreement expected remaining tax benefit percentage | 15.00% | |||
Tax receivable agreement unrecognized liability | $ 248.3 | $ 248.3 |
Lease Agreements - Assets and Liabilities, Lessee (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Assets | ||
Right-of-use assets | $ 16.2 | $ 18.5 |
Liabilities | ||
Current lease liabilities | 4.1 | 4.8 |
Noncurrent lease liabilities | 16.0 | 17.9 |
Total lease liabilities | $ 20.1 | $ 22.7 |
Lease Agreements - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Disaggregation of Revenue [Line Items] | ||||
Operating lease, expense | $ 1.4 | $ 1.4 | $ 2.8 | $ 2.9 |
Operating lease, payments | 3.0 | 3.2 | ||
Operating lease, lease income | 4.4 | $ 4.2 | 8.7 | $ 8.2 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2022-07-01 | SaaS Agreement | ||||
Disaggregation of Revenue [Line Items] | ||||
Total remaining performance obligations amount | $ 10.3 | $ 10.3 | ||
Total remaining performance obligations period | 1 year | 1 year |
Lease Agreements - Summary of Expected Payments Related to Non-cancellable Lease Terms (Details) - USD ($) $ in Millions |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
2022 (remaining six months) | $ 2.4 | |
2023 | 4.5 | |
2024 | 4.4 | |
2025 | 3.4 | |
2026 | 2.9 | |
Thereafter | 4.4 | |
Total lease payments | 22.0 | |
Less: Interest | (1.9) | |
Present value of minimum payments | $ 20.1 | $ 22.7 |
Lease Agreements - Additional Information Related to Operating Leases (Details) |
Jun. 30, 2022 |
Dec. 31, 2021 |
---|---|---|
Leases [Abstract] | ||
Weighted average remaining lease term (in years): | 5 years 4 months 24 days | 5 years 7 months 6 days |
Weighted average discount rate | 3.20% | 3.20% |
Stockholders' Equity/Members' Deficit (Details) - USD ($) |
3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
---|---|---|---|---|---|---|---|
May 24, 2022 |
Jun. 30, 2022 |
Jun. 30, 2022 |
Dec. 31, 2021 |
Jun. 15, 2022 |
May 11, 2022 |
Dec. 16, 2021 |
|
Class of Stock [Line Items] | |||||||
Treasury stock, common stock (in shares) | 3,887,191 | 3,887,191 | 378,475 | ||||
Treasury stock, common stock | $ 21,100,000 | ||||||
Treasury stock acquired (in dollars per share) | $ 47.40 | $ 55.81 | |||||
Stock repurchase program, remaining authorized repurchase amount | $ 44,500,000 | $ 44,500,000 | |||||
Retirement of treasury stock (in shares) | 3,539,016 | ||||||
Treasury stock, repurchased (in shares) | 726,650 | 726,650 | 378,475 | ||||
Searchlight | |||||||
Class of Stock [Line Items] | |||||||
Treasury stock, common stock (in shares) | 967,600 | ||||||
Treasury stock, common stock | $ 43,100,000 | ||||||
Treasury stock acquired (in dollars per share) | $ 44.54 | ||||||
Class A Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchase program, authorized amount | $ 50,000,000 | $ 100,000,000 | $ 100,000,000 | ||||
Treasury stock, common stock | $ 184,400,000 | $ 184,400,000 |
Noncontrolling Interests (Details) - Shift4 Payments, LLC. - shares |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2022 |
Dec. 31, 2021 |
|
Noncontrolling Interest [Line Items] | ||
LLC Interests (in shares) | 80,211,058 | 82,722,487 |
Shift4 Payments, Inc. | ||
Noncontrolling Interest [Line Items] | ||
LLC Interests (in shares) | 54,382,042 | 56,449,833 |
Ownership % | 67.80% | 68.20% |
Continuing Equity Owners | ||
Noncontrolling Interest [Line Items] | ||
LLC Interests (in shares) | 25,829,016 | 26,272,654 |
Ownership % | 32.20% | 31.80% |
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Supplemental Cash Flow Information [Line Items] | ||
Cash paid for interest | $ 12.4 | $ 10.5 |
Cash paid for income taxes, net of refunds | 0.1 | 0.3 |
Noncash investing activities | ||
Shares issued in connection with residual commission buyouts | 0.6 | 0.0 |
Equipment for lease | 2.0 | 5.8 |
Capitalized software development costs | 1.6 | 0.5 |
Noncash financing activities | ||
Right-of-use assets obtained in exchange for operating lease liabilities | 0.5 | 0.0 |
Right associated with Inspiration4 seat | 0.0 | 2.1 |
The Giving Block | ||
Noncash investing activities | ||
Shares and equity-based compensation awards issued in connection with acquisition | 36.5 | 0.0 |
VenueNext | ||
Noncash investing activities | ||
Shares and equity-based compensation awards issued in connection with acquisition | $ 0.0 | $ 26.3 |
Segments - Narrative (Details) |
6 Months Ended |
---|---|
Jun. 30, 2022
segment
| |
Segment Reporting [Abstract] | |
Number of operating segment | 1 |
Number of reportable segment | 1 |
Segments - Summary of Gross Revenue by Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2022 |
Jun. 30, 2021 |
Jun. 30, 2022 |
Jun. 30, 2021 |
|
Segment Reporting Information [Line Items] | ||||
Gross revenue | $ 506.7 | $ 351.0 | $ 908.6 | $ 590.3 |
Less: network fees | 324.1 | 214.7 | 577.2 | 356.5 |
Less: Other costs of sales | 76.8 | 58.2 | 141.0 | 103.9 |
Gross profit | 105.8 | 78.1 | 190.4 | 129.9 |
Payments-based revenue | ||||
Segment Reporting Information [Line Items] | ||||
Gross revenue | 473.9 | 324.8 | 845.4 | 540.7 |
Subscription and other revenues | ||||
Segment Reporting Information [Line Items] | ||||
Gross revenue | $ 32.8 | $ 26.2 | $ 63.2 | $ 49.6 |
Subsequent Events (Details) - Subsequent Events $ in Millions |
1 Months Ended | |
---|---|---|
Aug. 03, 2022
directors
|
Aug. 05, 2022
USD ($)
vendor
|
|
Chief Financial Officer | ||
Subsequent Event [Line Items] | ||
Employment agreement, term | 3 years | |
Employment agreement, renewal term | 1 year | |
Class I Director | ||
Subsequent Event [Line Items] | ||
Number of board directors | 2 | |
Class II Director | ||
Subsequent Event [Line Items] | ||
Number of board directors | 2 | |
Class III Director | ||
Subsequent Event [Line Items] | ||
Number of board directors | 2 | |
Residual commission buyouts | ||
Subsequent Event [Line Items] | ||
Asset acquisition, consideration transferred | $ | $ 120.0 | |
Technology Vendors | ||
Subsequent Event [Line Items] | ||
Number of vendors acquired | vendor | 3 | |
Business combination, consideration transferred | $ | $ 56.8 |
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