UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Mark One)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to .
Commission File Number
(Exact name of Registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
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(Address of Principal Executive Offices) |
(Zip Code) |
Registrant’s telephone number, including area code: (
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.
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).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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.
Large accelerated filer |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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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
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
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Name of each exchange on which registered |
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As of October 31, 2022, the registrant had
Marchex, Inc.
Form 10-Q
Table of Contents
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Page |
PART I. |
1 |
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Item 1. |
1 |
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1 |
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2 |
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3 |
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4 |
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5 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
16 |
Item 3. |
28 |
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Item 4. |
28 |
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PART II. |
29 |
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Item 1. |
29 |
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Item 1A. |
29 |
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Item 2. |
42 |
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Item 4. |
42 |
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Item 6. |
43 |
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44 |
PART I—FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
MARCHEX, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)
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December 31, |
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September 30, |
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2021 |
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2022 |
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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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$ |
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Accounts receivable, net |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment, net |
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Right-of-use lease asset |
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Other assets, net |
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Goodwill |
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Intangible assets from acquisitions, net |
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Total assets |
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$ |
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$ |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued benefits and payroll |
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Other accrued expenses and current liabilities |
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Deferred revenue and deposits |
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Lease liability, current |
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Total current liabilities |
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Deferred tax liabilities |
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Lease liability non-current |
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Total liabilities |
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Commitments and contingencies - See Note 10 |
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Stockholders’ equity: |
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Common stock, $ |
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Class A: outstanding at December 31, 2021 and September 30, 2022 |
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Class B: and outstanding at December 31, 2021, including of restricted stock; and at September 30, 2022, including |
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Additional paid-in capital |
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Accumulated deficit |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
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$ |
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$ |
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See accompanying Notes to the Condensed Consolidated Financial Statements.
1
MARCHEX, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
(unaudited)
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Nine Months Ended September 30, |
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Three Months Ended September 30, |
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2021 |
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2022 |
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2021 |
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2022 |
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Revenue |
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$ |
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$ |
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$ |
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$ |
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Expenses: |
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Service costs(1)(3) |
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Sales and marketing(1)(3) |
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Product development(1)(3) |
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General and administrative(1)(3) |
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Amortization of intangible assets from acquisitions(2) |
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Acquisition and disposition-related costs |
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Total operating expenses |
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Loss from operations |
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( |
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( |
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Gain on loan extinguishment |
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— |
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— |
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Interest income and other, net |
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Income (loss) before provision for income taxes |
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Income tax expense (benefit) |
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( |
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( |
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( |
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Net income (loss) applicable to common stockholders |
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$ |
( |
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$ |
( |
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$ |
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$ |
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Basic and diluted net income (loss) per Class A and Class B share applicable to common stockholders |
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$ |
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$ |
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$ |
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$ |
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Shares used to calculate basic net income (loss) per share applicable to common stockholders: |
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Class A |
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Class B |
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Shares used to calculate diluted net income (loss) per share applicable to common stockholders: |
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Class A |
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Class B |
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(1) Excludes amortization of intangibles from acquisitions |
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(2) Components of amortization of intangibles from acquisitions |
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Service costs |
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$ |
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$ |
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Sales and marketing |
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General and administrative |
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— |
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— |
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— |
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Total |
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$ |
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$ |
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$ |
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$ |
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(3) Components of related party support services fee recovery |
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Service costs |
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$ |
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$ |
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$ |
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Sales and marketing |
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Product development |
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General and administrative |
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Total |
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$ |
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$ |
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$ |
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$ |
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See accompanying Notes to the Condensed Consolidated Financial Statements.
2
MARCHEX, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Stockholders’ Equity
(in thousands)
(unaudited)
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Class A |
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Class B |
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Additional |
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Total |
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common stock |
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common stock |
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Treasury stock |
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paid-in |
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Accumulated |
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stockholders’ |
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Shares |
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Amount |
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Shares |
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Amount |
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Shares |
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Amount |
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capital |
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deficit |
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equity |
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Balances at December 31, 2020 |
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$ |
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$ |
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— |
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$ |
— |
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$ |
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$ |
( |
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$ |
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Issuance of common stock upon exercise of options, issuance and vesting of restricted stock and under employee stock purchase plan, net |
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— |
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— |
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— |
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— |
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— |
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Stock compensation from options and restricted stock, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Balances at March 31, 2021 |
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$ |
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$ |
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— |
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$ |
— |
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$ |
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$ |
( |
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$ |
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Issuance of common stock upon exercise of options, issuance and vesting of restricted stock and under employee stock purchase plan, net |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock compensation from options and restricted stock, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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Balances at June 30, 2021 |
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$ |
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$ |
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— |
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— |
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$ |
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$ |
( |
) |
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$ |
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Issuance of common stock upon exercise of options, issuance and vesting of restricted stock and under employee stock purchase plan, net |
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— |
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— |
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— |
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— |
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— |
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Stock compensation from options and restricted stock, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Net income |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Balances at September 30, 2021 |
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$ |
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$ |
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— |
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— |
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$ |
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$ |
( |
) |
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$ |
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Class A |
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Class B |
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Additional |
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Total |
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common stock |
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common stock |
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Treasury stock |
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paid-in |
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Accumulated |
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stockholders’ |
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Shares |
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Amount |
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Shares |
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Amount |
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Shares |
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Amount |
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capital |
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deficit |
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equity |
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Balances at December 31, 2021 |
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$ |
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$ |
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( |
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$ |
— |
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$ |
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$ |
( |
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Issuance of common stock upon exercise of options, issuance and vesting of restricted stock and under employee stock purchase plan, net |
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— |
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— |
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— |
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— |
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— |
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Retirements of restricted stock |
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— |
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— |
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( |
) |
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— |
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— |
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— |
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— |
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— |
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Stock compensation from options and restricted stock, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balances at March 31, 2022 |
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$ |
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$ |
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— |
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$ |
- |
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$ |
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$ |
( |
) |
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Issuance of common stock upon exercise of options, issuance and vesting of restricted stock and under employee stock purchase plan, net |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock compensation from options and restricted stock, net of forfeitures |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Net loss |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
) |
Balances at June 30, 2022 |
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