Quarterly Report (10-q)
01 Maio 2023 - 05:05PM
Edgar (US Regulatory)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
10-Q
(Mark One)
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☒
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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For the Quarterly Period Ended
March 31,
2023
OR
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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For the transition period from to
Commission File Number
000-24435
MICROSTRATEGY INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or
organization)
51-0323571
(I.R.S. Employer
Identification Number)
1850 Towers Crescent Plaza,
Tysons Corner,
VA
(Address of Principal Executive Offices)
22182
(Zip Code)
(703)
848-8600
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the
Act:
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Title of Each Class
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Trading Symbol
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Name of Each Exchange on which Registered
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Class A common stock, par value $0.001 per share
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MSTR
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The Nasdaq Global Select Market
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Indicate by check mark whether the registrant,: (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes
☒
No
☐
Indicate by check mark whether the registrant has submitted
electronically every Interactive Data File required to be submitted
pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter)
during the preceding 12 months (or for such shorter period that the
registrant was required to submit such files).
Yes
☒
No
☐
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, a
smaller reporting company, or an emerging growth company. See the
definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule
12b-2 of the Exchange Act.
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Large accelerated filer
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☒
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange
Act.
☐
Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act). Yes
☐
No
☒
As of April 24, 2023,
the registrant had
10,994,626
and
1,964,025
shares of class A common stock and class B common stock
outstanding, respectively.
MICROSTRATEGY INCORPORATED
FORM 10-Q
TABLE OF CONTENTS
PART I - FINANCIAL
INFORMATION
Item 1. Financial
Statements
MICROSTRATEGY INCORPORATED
CONSOLIDATED BALANCE
SHEETS
(in thousands, except per share data)
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March 31,
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December 31,
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2023
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2022
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(unaudited)
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Assets
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Current assets:
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Cash and cash equivalents
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$
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94,311
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$
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43,835
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Restricted cash
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2,153
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7,033
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Accounts receivable, net
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139,178
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189,280
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Prepaid expenses and other current assets
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|
24,034
|
|
|
|
24,418
|
|
|
Total current assets
|
|
|
259,676
|
|
|
|
264,566
|
|
|
Digital assets
|
|
|
2,000,392
|
|
|
|
1,840,028
|
|
|
Property and equipment, net
|
|
|
31,338
|
|
|
|
32,311
|
|
|
Right-of-use assets
|
|
|
59,655
|
|
|
|
61,299
|
|
|
Deposits and other assets
|
|
|
23,825
|
|
|
|
23,916
|
|
|
Deferred tax assets, net
|
|
|
651,516
|
|
|
|
188,152
|
|
|
Total assets
|
|
$
|
3,026,402
|
|
|
$
|
2,410,272
|
|
|
Liabilities and Stockholders’ Equity (Deficit)
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable, accrued expenses, and operating lease
liabilities
|
|
$
|
50,604
|
|
|
$
|
42,976
|
|
|
Accrued compensation and employee benefits
|
|
|
39,199
|
|
|
|
53,716
|
|
|
Accrued interest
|
|
|
10,368
|
|
|
|
2,829
|
|
|
Current portion of long-term debt, net
|
|
|
460
|
|
|
|
454
|
|
|
Deferred revenue and advance payments
|
|
|
211,768
|
|
|
|
217,428
|
|
|
Total current liabilities
|
|
|
312,399
|
|
|
|
317,403
|
|
|
Long-term debt, net
|
|
|
2,175,918
|
|
|
|
2,378,560
|
|
|
Deferred revenue and advance payments
|
|
|
11,646
|
|
|
|
12,763
|
|
|
Operating lease liabilities
|
|
|
65,355
|
|
|
|
67,344
|
|
|
Other long-term liabilities
|
|
|
17,675
|
|
|
|
17,124
|
|
|
Deferred tax liabilities
|
|
|
198
|
|
|
|
198
|
|
|
Total liabilities
|
|
|
2,583,191
|
|
|
|
2,793,392
|
|
|
Commitments and Contingencies
|
|
|
|
|
|
|
|
Stockholders’ Equity (Deficit)
|
|
|
|
|
|
|
|
Preferred stock undesignated, $0.001 par
value;
5,000 shares
authorized;
no shares
issued or outstanding
|
|
|
0
|
|
|
|
0
|
|
|
Class A common stock, $0.001 par
value;
330,000 shares
authorized;
19,679 shares
issued and
10,995 shares
outstanding, and
18,269 shares
issued and
9,585 shares
outstanding, respectively
|
|
|
20
|
|
|
|
18
|
|
|
Class B convertible common stock, $0.001 par
value;
165,000 shares
authorized;
1,964 shares
issued and outstanding, and
1,964 shares
issued and outstanding, respectively
|
|
|
2
|
|
|
|
2
|
|
|
Additional paid-in capital
|
|
|
2,205,518
|
|
|
|
1,841,120
|
|
|
Treasury stock, at cost;
8,684 shares
and
8,684 shares,
respectively
|
|
|
(782,104
|
)
|
|
|
(782,104
|
)
|
|
Accumulated other comprehensive loss
|
|
|
(13,063
|
)
|
|
|
(13,801
|
)
|
|
Accumulated deficit
|
|
|
(967,162
|
)
|
|
|
(1,428,355
|
)
|
|
Total stockholders’ equity (deficit)
|
|
|
443,211
|
|
|
|
(383,120
|
)
|
|
Total liabilities and stockholders’ equity (deficit)
|
|
$
|
3,026,402
|
|
|
$
|
2,410,272
|
|
The accompanying notes are an integral part of these Consolidated
Financial Statements.
1
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS
OF OPERATIONS
(in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
2023
|
|
|
2022
|
|
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
Revenues:
|
|
|
|
|
|
|
|
Product licenses
|
|
$
|
17,412
|
|
|
$
|
16,513
|
|
|
Subscription services
|
|
|
18,810
|
|
|
|
12,845
|
|
|
Total product licenses and subscription services
|
|
|
36,222
|
|
|
|
29,358
|
|
|
Product support
|
|
|
65,481
|
|
|
|
67,151
|
|
|
Other services
|
|
|
20,212
|
|
|
|
22,768
|
|
|
Total revenues
|
|
|
121,915
|
|
|
|
119,277
|
|
|
Cost of revenues:
|
|
|
|
|
|
|
|
Product licenses
|
|
|
534
|
|
|
|
477
|
|
|
Subscription services
|
|
|
7,856
|
|
|
|
5,410
|
|
|
Total product licenses and subscription services
|
|
|
8,390
|
|
|
|
5,887
|
|
|
Product support
|
|
|
5,768
|
|
|
|
5,191
|
|
|
Other services
|
|
|
13,783
|
|
|
|
14,599
|
|
|
Total cost of revenues
|
|
|
27,941
|
|
|
|
25,677
|
|
|
Gross profit
|
|
|
93,974
|
|
|
|
93,600
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
Sales and marketing
|
|
|
36,106
|
|
|
|
33,240
|
|
|
Research and development
|
|
|
31,358
|
|
|
|
33,523
|
|
|
General and administrative
|
|
|
27,906
|
|
|
|
26,706
|
|
|
Digital asset impairment losses
|
|
|
18,911
|
|
|
|
170,091
|
|
|
Total operating expenses
|
|
|
114,281
|
|
|
|
263,560
|
|
|
Loss from operations
|
|
|
(20,307
|
)
|
|
|
(169,960
|
)
|
|
Interest expense, net
|
|
|
(14,930
|
)
|
|
|
(11,039
|
)
|
|
Gain on debt extinguishment
|
|
|
44,686
|
|
|
|
0
|
|
|
Other (expense) income, net
|
|
|
(1,443
|
)
|
|
|
2,225
|
|
|
Income (loss) before income taxes
|
|
|
8,006
|
|
|
|
(178,774
|
)
|
|
Benefit from income taxes
|
|
|
(453,187
|
)
|
|
|
(48,023
|
)
|
|
Net income (loss)
|
|
$
|
461,193
|
|
|
$
|
(130,751
|
)
|
|
Basic earnings (loss) per share (1)
|
|
$
|
38.97
|
|
|
$
|
(11.58
|
)
|
|
Weighted average shares outstanding used in computing basic
earnings (loss) per share
|
|
|
11,834
|
|
|
|
11,289
|
|
|
Diluted earnings (loss) per share (1)
|
|
$
|
31.79
|
|
|
$
|
(11.58
|
)
|
|
Weighted average shares outstanding used in computing diluted
earnings (loss) per share
|
|
|
14,575
|
|
|
|
11,289
|
|
(1)
Basic and fully diluted earnings (loss) per share for class A and
class B common stock are the same.
The accompanying notes are an integral part of these Consolidated
Financial Statements.
2
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS
OF COMPREHENSIVE INCOME (LOSS)
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
March 31,
|
|
|
|
|
2023
|
|
|
2022
|
|
|
|
|
(unaudited)
|
|
|
(unaudited)
|
|
|
Net income (loss)
|
|
$
|
461,193
|
|
|
$
|
(130,751
|
)
|
|
Other comprehensive income (loss), net of applicable
taxes:
|
|
|
|
|
|
|
|
Foreign currency translation adjustment
|
|
|
738
|
|
|
|
(2,009
|
)
|
|
Total other comprehensive income (loss)
|
|
|
738
|
|
|
|
(2,009
|
)
|
|
Comprehensive income (loss)
|
|
$
|
461,931
|
|
|
$
|
(132,760
|
)
|
The accompanying notes are an integral part of these Consolidated
Financial Statements.
3
MICROSTRATEGY INCORPORATED
CONSOLIDATED STATEMENTS
OF STOCKHOLDERS’ EQUITY (DEFICIT)
(in thousands, unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A
|
|
|
Class B Convertible
|
|
|
Additional
|
|
|
|
|
|
|
|
|
Accumulated Other
|
|
|
(Accumulated Deficit)
|
|
|
|
|
|
|
|
Common Stock
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Treasury Stock
|
|
|
Comprehensive
|
|
|
Retained
|
|
|
|
|
Total
|
|
|
Shares
|
|
|
Amount
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Shares
|
|
|
Amount
|
|
|
Loss
|
|
|
Earnings
|
|
|
Balance at January 1, 2022
|
|
$
|
978,958
|
|
|
|
18,006
|
|
|
$
|
18
|
|
|
|
1,964
|
|
|
$
|
2
|
|
|
$
|
1,727,143
|
|
|
|
(8,684
|
)
|
|
$
|
(782,104
|
)
|
|
$
|
(7,543
|
)
|
|
$
|
41,442
|
|
|
Net loss
|
|
|
(130,751
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(130,751
|
)
|
|
Other comprehensive loss
|
|
|
(2,009
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(2,009
|
)
|
|
|
0
|
|
|
Issuance of class A common stock upon exercise of stock
options
|
|
|
288
|
|
|
|
2
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
288
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Issuance of class A common stock under employee stock purchase
plan
|
|
|
2,805
|
|
|
|
7
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
2,805
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Issuance of class A common stock upon vesting of restricted stock
units, net of withholding taxes
|
|
|
(501
|
)
|
|
|
3
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(501
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Share-based compensation expense
|
|
|
14,209
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
14,209
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Balance at March 31, 2022
|
|
$
|
862,999
|
|
|
|
18,018
|
|
|
$
|
18
|
|
|
|
1,964
|
|
|
$
|
2
|
|
|
$
|
1,743,944
|
|
|
|
(8,684
|
)
|
|
$
|
(782,104
|
)
|
|
$
|
(9,552
|
)
|
|
$
|
(89,309
|
)
|
|
Net loss
|
|
|
(1,062,298
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(1,062,298
|
)
|
|
Other comprehensive loss
|
|
|
(4,113
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(4,113
|
)
|
|
|
0
|
|
|
Issuance of class A common stock upon exercise of stock
options
|
|
|
423
|
|
|
|
3
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
423
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Issuance of class A common stock upon vesting of restricted stock
units, net of withholding taxes
|
|
|
(49
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(49
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Share-based compensation expense
|
|
|
15,970
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
15,970
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Balance at June 30, 2022
|
|
$
|
(187,068
|
)
|
|
|
18,021
|
|
|
$
|
18
|
|
|
|
1,964
|
|
|
$
|
2
|
|
|
$
|
1,760,288
|
|
|
|
(8,684
|
)
|
|
$
|
(782,104
|
)
|
|
$
|
(13,665
|
)
|
|
$
|
(1,151,607
|
)
|
|
Net loss
|
|
|
(27,079
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(27,079
|
)
|
|
Other comprehensive loss
|
|
|
(4,514
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(4,514
|
)
|
|
|
0
|
|
|
Issuance of class A common stock upon exercise of stock
options
|
|
|
621
|
|
|
|
4
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
621
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Issuance of class A common stock under employee stock purchase
plan
|
|
|
1,668
|
|
|
|
9
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
1,668
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Issuance of class A common stock upon vesting of restricted stock
units, net of withholding taxes
|
|
|
(642
|
)
|
|
|
4
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(642
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Share-based compensation expense
|
|
|
16,725
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
16,725
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Balance at September 30, 2022
|
|
$
|
(200,289
|
)
|
|
|
18,038
|
|
|
$
|
18
|
|
|
|
1,964
|
|
|
$
|
2
|
|
|
$
|
1,778,660
|
|
|
|
(8,684
|
)
|
|
$
|
(782,104
|
)
|
|
$
|
(18,179
|
)
|
|
$
|
(1,178,686
|
)
|
|
Net loss
|
|
|
(249,669
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(249,669
|
)
|
|
Other comprehensive income
|
|
|
4,378
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
4,378
|
|
|
|
0
|
|
|
Issuance of class A common stock upon exercise of stock
options
|
|
|
61
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
61
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Issuance of class A common stock upon vesting of restricted stock
units, net of withholding taxes
|
|
|
(1,021
|
)
|
|
|
12
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
(1,021
|
)
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Issuance of class A common stock under public offerings, net of
issuance costs
|
|
|
46,219
|
|
|
|
219
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
46,219
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Share-based compensation expense
|
|
|
17,201
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
17,201
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
Balance at December 31, 2022
|
|
$
|
(383,120
|
)
|
|
|
18,269
|
|
|
$
|
18
|
|
|
|
1,964
|
|
|
$
|
2
|
|
|
$
|
1,841,120
|
|
|
|
(8,684
|
)
|
|
$
|
(782,104
|
)
|
|
$
|
(13,801
|
)
|
|
$
|
(1,428,355
|
)
|
|
Net income
|
|
|
461,193
|