Quarterly report pursuant to Section 13 or 15(d)

Summary of Significant Accounting Policies (Policies)

v3.22.2.2
Summary of Significant Accounting Policies (Policies)
9 Months Ended
Sep. 30, 2022
Accounting Policies [Abstract]  
Principles of Consolidation

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company. All material intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of the unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements. Estimates also affect the reported amounts of revenue and expenses during the periods reported. Some of the significant estimates that the Company has made pertain to the determination of deferred tax assets and liabilities; estimates utilized to determine the fair value of assets acquired and liabilities assumed in business combinations and the related goodwill and intangibles; and certain assumptions used related to the evaluation of goodwill, intangibles, and property and equipment asset impairment. Actual results could differ from those estimates.

Accounts Receivable, Net

Accounts Receivable, Net

Accounts receivable are presented net of an allowance for doubtful accounts of $119 and $70 as of September 30, 2022 and December 31, 2021, respectively. The activity in the allowance for doubtful accounts was immaterial for the three and nine months ended September 30, 2022 and 2021.

Other Receivables

Other Receivables

Other receivables consisted of the following for the periods presented:

 

As of

 

 

September 30, 2022

 

 

December 31, 2021

 

Payroll tax withholding and exercise proceeds receivable

$

9

 

 

$

8,477

 

Construction receivable

 

8,034

 

 

 

5,574

 

Income tax receivable

 

1,891

 

 

 

4,935

 

Insurance receivable

 

2,977

 

 

 

2,594

 

Other

 

1,530

 

 

 

1,216

 

Total other receivables

$

14,441

 

 

$

22,796

 

Inventory

Inventory, Net

Inventory consisted of the following for the periods presented:

 

As of

 

 

September 30, 2022

 

 

December 31, 2021

 

Chemical washing solutions

$

9,063

 

 

$

6,406

 

Other

 

-

 

 

 

52

 

Total inventory, gross

 

9,063

 

 

 

6,458

 

Reserve for obsolescence

 

(175

)

 

 

(124

)

Total inventory, net

$

8,888

 

 

$

6,334

 

The activity in the reserve for obsolescence was immaterial for the three and nine months ended September 30, 2022 and 2021.

Revenue Recognition

Revenue Recognition

The following table summarizes the composition of the Company’s net revenues for the periods presented:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Recognized over time

$

150,873

 

 

$

127,825

 

 

$

440,809

 

 

$

358,456

 

Recognized at a point in time

 

66,590

 

 

 

66,026

 

 

 

220,420

 

 

 

206,087

 

Other revenue

 

113

 

 

 

459

 

 

 

925

 

 

 

2,355

 

Net revenues

$

217,576

 

 

$

194,310

 

 

$

662,154

 

 

$

566,898

 

 

Net Income Per Share

Net Income (loss) Per Share

Basic net income (loss) per share is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted net income (loss) per share is computed by dividing net income by the weighted-average shares outstanding for the period and includes the dilutive impact of potential new shares issuable upon vesting and exercise of stock options, vesting of restricted stock units, and stock purchase rights granted under an employee stock purchase plan. Potentially dilutive securities are excluded from the computation of diluted net income per share if their effect is antidilutive. Reconciliations of the numerators and denominators of the basic and diluted net income per share calculations for the periods presented are as follows:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Numerator:

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

$

23,997

 

 

$

27,366

 

 

$

95,144

 

 

$

(58,350

)

 

 

 

 

 

 

 

 

 

 

 

 

Denominator:

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding - basic

 

304,290,590

 

 

 

296,360,660

 

 

 

302,641,749

 

 

 

274,387,532

 

Effect of potentially dilutive securities:

 

 

 

 

 

 

 

 

 

 

 

Stock options

 

22,377,790

 

 

 

30,251,223

 

 

 

24,433,580

 

 

 

-

 

Restricted stock units

 

154,987

 

 

 

652,019

 

 

 

678,005

 

 

 

-

 

Employee stock purchase plan

 

57,785

 

 

 

56,267

 

 

 

20,010

 

 

 

-

 

Weighted-average common shares outstanding - diluted

 

326,881,152

 

 

 

327,320,169

 

 

 

327,773,344

 

 

 

274,387,532

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share - basic

$

0.08

 

 

$

0.09

 

 

$

0.31

 

 

$

(0.21

)

Net income (loss) per share - diluted

$

0.07

 

 

$

0.08

 

 

$

0.29

 

 

$

(0.21

)

 

The following potentially dilutive shares were excluded from the computation of diluted net income per share for the periods presented because including them would have been antidilutive:

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Stock options

 

2,384,530

 

 

 

2,086,437

 

 

 

2,188,289

 

 

 

33,773,922

 

Restricted stock units

 

15,165

 

 

 

-

 

 

 

60,612

 

 

 

1,592,524

 

Employee stock purchase plan

 

7,186

 

 

 

-

 

 

 

34,466

 

 

 

244,751

 

Deferred Offering Costs

Deferred Offering Costs

The Company capitalizes certain legal, accounting, and other third-party fees that are directly related to the Company’s equity financings, including the IPO, until such financings are consummated. After consummation of an equity financing, these costs are then recorded as a reduction of the proceeds received as a result of the financing. Should a planned equity financing be abandoned, terminated, or significantly delayed, the deferred offering costs would be immediately written off to operating expenses. Upon the closing of the IPO in June 2021, all deferred offering costs in the accompanying unaudited condensed consolidated balance sheets were reclassified from prepaid expenses and other current assets and recorded against the IPO proceeds as a reduction to additional paid-in capital. As of September 30, 2022 and December 31, 2021, there were no deferred offering costs capitalized.

Prior Period Reclassification

Prior Period Reclassification

Certain prior period amounts related to other receivables within accounts receivable, net and prepaid expenses and other current assets in the accompanying unaudited condensed consolidated financial statements have been reclassified to conform to the current period presentation. There was no change to prior period current or total assets.

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU No. 2016-13”), which replaces the existing incurred loss impairment model with an expected credit loss model and requires a financial asset measured at amortized cost to be presented at the net amount expected to be collected. The guidance will be effective for the Company beginning January 1, 2023, and interim periods therein. Early adoption is permitted. The Company is currently evaluating the effect that ASU No. 2016-13 will have on its consolidated financial statements and related disclosures.

In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805) – Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU No. 2021-08”). The guidance improves the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and certain inconsistencies in application. Under current U.S. GAAP, an acquirer generally recognizes contract assets acquired and liabilities assumed in a business combination at fair value on the acquisition date. The amendments in this update require that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC Topic 606 as if it had originated the contracts. The amendments in this update will be effective for the Company beginning January 1, 2023, and interim periods thereafter. Early adoption is permitted, including adoption in an interim period. The Company is currently evaluating the effect that ASU No. 2021-08 will have on its consolidated financial statements and related disclosures.