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Company delivered $1.1 billion in revenue in 2021, up 44% year-over-year and exceeding guidance; guides to a range of 34%-36% revenue growth in 2022
SAN FRANCISCO, Calif., Feb 3, 2022 — Unity Software Inc. (NYSE: U), the world’s leading platform for creating and operating interactive, real-time 3D (RT3D) content, today announced fourth quarter 2021 revenue of $315.9 million, which is up 43% from the same period in 2020 and ahead of guidance. Additionally, the company announced full-year 2021 revenue of $1.1 billion, a growth of 44% year-over-year.
“Unity’s strong fourth-quarter and full-year results were driven by exceptional execution and innovation by the Unity teams,” said John Riccitiello, President and Chief Executive Officer, Unity. “We believe that the transition from linear 2D to interactive real-time 3D, presents a massive growth opportunity for the next decades. These are strong tailwinds that help us drive growth for years to come.”
Since becoming a public company in September 2020, Unity has averaged 43% revenue growth. Customers contributing $100,000 or more in revenue in the trailing 12 months increased 33%, from 793 as of December 31, 2020 to 1,052 as of December 31, 2021.
“We are encouraged by our performance in 2021 with strong results across Create and Operate Solutions,” said Luis Visoso, Chief Financial Officer, Unity. “The business momentum coupled with the quality of our innovation plans gives us confidence to guide to a revenue growth range of 34% to 36% in 2022 as we continue to improve margins.”
Fourth Quarter 2021 Financial Highlights
Full Year 2021 Financial Highlights
Recent Business Highlights
Outlook
Unity is providing the following guidance for the first quarter and guidance for the full year ending December 31, 2022.
Q1 2022 2022 Guidance Guidance Revenue (in millions) $315 — $320 $1,485 — $1,505 Year-over-year revenue growth 34% — 36% 34% — 36% Non-GAAP loss from operations (in millions) ($22) — ($23) ($39) — ($41) Non-GAAP operating margin (7%) (3%) Fully diluted shares outstanding 343M 349M
A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future and cannot be reasonably determined or predicted at this time, although it is important to note that these factors could be material to Unity’s results computed in accordance with GAAP.
Earnings Webcast Details
Unity plans to host a video webcast for analysts and investors today to discuss its fourth quarter and full-year 2021 financial results and outlook for its first quarter and full-year 2022. The video webcast is scheduled to begin at 2:00 p.m. Pacific Time/5:00 p.m. Eastern Time and can be accessed at the Unity Investor Relations website at investors.unity.com. The video webcast will be available live, and a replay will be available on the Investor Relations website following completion of the live broadcast for approximately 90 days.
About Unity
Unity is the world’s leading platform for creating and operating interactive, real-time 3D content. Our platform provides a comprehensive set of software solutions to create, run, and monetize interactive, real-time 2D and 3D content for mobile phones, tablets, PCs, consoles, and augmented and virtual reality devices. We serve customers of all sizes, at every stage of maturity, from individual creators to large enterprises. For more information, visit unity.com.
Unity uses its Investor Relations website (investors.unity.com), filings with the SEC, press releases, public conference calls, and public webcasts as means of disclosing material nonpublic information and for complying with its disclosure obligations under Regulation FD.
Use of Non-GAAP Financial Measures
Reconciliations of non-GAAP financial measures to Unity’s financial results as determined in accordance with GAAP are included at the end of this press release following the accompanying financial data. For a description of these non-GAAP financial measures, including the reasons management uses each measure, please see the section of the tables titled “About Non-GAAP Financial Measures.”
Forward-Looking Statements
This press release and the earnings call referencing this press release contain “forward-looking statements,” as that term is defined under federal securities laws, including, but not limited to, statements regarding Unity’s first quarter and full-year 2022 outlook and future financial performance, including the evolution to RT3D content; and Unity’s belief that it presents a massive growth opportunity and strong tailwinds to help Unity drive growth for decades to come; that Unity is committed to improving operating margins as it continues to gain scale; that Unity expects revenue to grow at or above 40% for the long-term and to expand operating margins sequentially, breaking even on a non-GAAP basis within 2023; Unity’s belief that there is significant upside in its non-gaming business due to embedded structural advantages; that innovation, new product initiatives and strategic acquisitions are expected to expand Unity’s total addressable market, increase its serviceable market and the value of the Unity platform to its customers; that since Unity prudently assesses risks when constructing guidance, it can beat guidance if things fall Unity’s way; that Unity continues to make progress across industries and use-cases and expects to build long term partnerships as Unity software is embedded into its customers’ digital strategy; business plans, priorities and objectives, potential market and growth opportunities; product features, functionality, and expected benefits to the business and Unity’s customers; competitive position; product strategies and future product and platform features; technological or market trends; and industry environment. The words “believe,” “may,” “will,” “estimate,” “continue,” “intend,” “expect,” “plan,” “project,” and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to risks, uncertainties, and assumptions. If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. Risks include, but are not limited to: (i) the impact of the ongoing COVID-19 pandemic on our business, as well as our customers, prospects, partners, and service providers; (ii) our ability to achieve profitability and the timing for any such achievement; (iii) our ability to retain existing customers and expand the use of our platform; (iv) our ability to further expand into new industries and attract new customers; (v) the impact of any changes of terms of service, policies or technical requirements from operating system platform providers or application stores which may result in changes to our or our customers’ business practices; (vi) our ability to maintain favorable relationships with hardware, operating system, device, game console and other technology providers; (vii) our ability to compete effectively in the markets in which we participate; (viii) breaches in our security measures, unauthorized access to our platform, our data, or our customers’ or other users’ personal data; (ix) our ability to manage growth effectively; (x) the rapidly changing and increasingly stringent laws, contractual obligations and industry standards that relate to privacy, data security and the protection of children; (xi) Unity’s ability to successfully integrate Weta Digital’s technology and business; (xii) costs related to the integration; (xiii) whether potential benefits of the transaction extend to Unity and Weta Digital's customers and other potential creators; (xiv) Unity’s and Weta Digital’s success developing new products or modifying existing products and the degree to which these gain market acceptance; (xvi) any unanticipated impact of accounting for the acquisition; and (xvii) the conditional closing of the transaction. Further information on these and additional risks that could affect Unity’s results is included in our filings with the Securities and Exchange Commission (SEC), including our Quarterly Report on Form 10-Q filed with the SEC on November 9, 2021, and our future reports that we may file with the SEC from time to time, which could cause actual results to vary from expectations. Copies of reports filed with the SEC are available on the Unity Investor Relations website. Unity assumes no obligation to, and does not currently intend to, update any such forward-looking statements after the date of this release.
Any unreleased services, features, or functions referenced in this document, our website, or other press releases or public statements that are not currently available are subject to change at Unity’s discretion and may not be delivered as planned or at all. Customers who purchase Unity services should make their purchase decisions based upon services, features, and functions that are currently available.
© 2022 Unity Software Inc. All rights reserved. The Unity design logos, “Unity” and our other registered or common law trademarks, service marks, or trade names are the property of Unity Software Inc. or its affiliates. Other trade names, trademarks, and service marks are the property of their respective owners.About Non-GAAP Financial Measures
To supplement our consolidated financial statements prepared and presented in accordance with generally accepted accounting principles in the United States (GAAP) we use certain non-GAAP performance financial measures, as described below, to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe the following non-GAAP measures are useful in evaluating our operating performance. We are presenting these non-GAAP financial measures because we believe, when taken collectively, they may be helpful to investors because they provide consistency and comparability with past financial performance.
However, non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning prescribed by GAAP and are not prepared under any comprehensive set of accounting rules or principles. In addition, other companies, including companies in our industry, may calculate similarly-titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. As a result, our non-GAAP financial measures are presented for supplemental informational purposes only and should not be considered in isolation or as a substitute for our consolidated financial statements presented in accordance with GAAP.
Non-GAAP Gross Profit, Non-GAAP Operating Expenses, and Non-GAAP Loss from Operations
We define non-GAAP gross profit as gross profit excluding stock-based compensation expense, employer tax related to employee stock transactions, and amortization of acquired intangible assets expense. We define non-GAAP research and development expense and non-GAAP sales and marketing expense as research and development expense and sales and marketing expense, respectively, excluding stock-based compensation expense, employer tax related to employee stock transactions, and amortization of acquired intangible assets expense. We define non-GAAP general and administrative expense as general and administrative expense excluding stock-based compensation expense, employer tax related to employee stock transactions, a one-time expense for the termination of a future lease agreement, and non-cash charitable contribution expense. We define non-GAAP loss from operations as loss from operations excluding stock-based compensation expense, employer tax related to employee stock transactions, amortization of acquired intangible assets expense, a one-time expense for the termination of a future lease agreement, and non-cash charitable contribution expense.
We use non-GAAP gross profit and non-GAAP loss from operations in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP gross profit and non-GAAP loss from operations provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations, as these metrics exclude stock-based compensation expense, employer tax related to employee stock transactions, amortization of acquired intangible assets expense, a one-time expense for the termination of a future lease agreement, and non-cash charitable contribution expense, which we do not consider to be indicative of our overall operating performance.
Non-GAAP gross profit, non-GAAP operating expenses, and non-GAAP loss from operations have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:
Non-GAAP Net Loss and Non-GAAP Net Loss per Share
We define non-GAAP net loss and non-GAAP net loss per share as net loss and net loss per share excluding stock-based compensation expense, employer tax related to employee stock transactions, amortization of acquired intangible assets expense, a one-time expense for the termination of a future lease agreement, and non-cash charitable contribution expense, as well as the related tax effects of these items. Non-GAAP net loss per share also adds back expense relating to deemed dividends representing excess paid over initial issuance price to repurchase convertible preferred stock. We use non-GAAP net loss and non-GAAP net loss per share in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that these non-GAAP measures provide our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations.
Non-GAAP net loss and non-GAAP net loss per share have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:
Income Tax Effects of Non-GAAP Adjustments
We utilize a fixed projected tax rate in our computation of non-GAAP income tax effects to provide better consistency across interim reporting periods. In projecting this non-GAAP tax rate, we utilize a financial projection that excludes the direct impact of the non-GAAP adjustments described above, and eliminates the effects of non-recurring and period specific items which can vary in size and frequency. The projected rate considers other factors such as our current operating structure, existing tax positions in various jurisdictions, and key legislation in major jurisdictions where we operate. For the year ended December 31, 2020, the non-GAAP tax rate was (17)%. For the year ending December 31, 2021, we have determined the projected non-GAAP tax rate to be (22)%. We will periodically re-evaluate this tax rate, as necessary, for significant events, based on relevant tax law changes, material changes in the forecasted geographic earnings mix, and any significant acquisitions.
Free Cash Flow
We define free cash flow as net cash used in operating activities less cash used for purchases of property and equipment. We believe that free cash flow is a useful indicator of liquidity as it measures our ability to generate cash, or our need to access additional sources of cash, to fund operations and investments.
Free cash flow has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:
Key Metrics
We monitor the following key metrics to help us evaluate the health of our business, identify trends affecting our growth, formulate goals and objectives, and make strategic decisions.
Customers Contributing More Than $100,000 of Revenue
We focus on the number of customers that generated more than $100,000 of revenue in the trailing 12 months, as this segment of our customer base represents the majority of our revenue and revenue growth. We define a customer as an individual or entity that generated revenue during the measurement period. A single organization with multiple divisions, segments, or subsidiaries is generally counted as a single customer, even though we may enter into commercial agreements with multiple parties within that organization.
Dollar-Based Net Expansion Rate
We track our performance by measuring our dollar-based net expansion rate, which compares our Create and Operate Solutions revenue from the same set of customers across comparable periods, calculated on a trailing 12-month basis. Our dollar-based net expansion rate as of a period end is calculated as current period revenue divided by prior period revenue. Prior period revenue is the trailing 12-month revenue measured as of such prior period end and includes revenue from all customers that contributed revenue during such trailing 12-month period. Current period revenue is the trailing 12-month revenue from these same customers as of the current period end. Our dollar-based net expansion rate includes the effect of any customer renewals, expansion, contraction, and churn but excludes revenue from new customers in the current period.
Contact
Investor Relations:
Richard Davis
richard.davis@unity3d.com
Media Relations:
Marisa Graves
marisag@unity3d.com
Source: Unity
UNITY SOFTWARE INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands, except par value) (Unaudited) As of December 31,
2021 December 31,
2020 Assets Current assets: Cash and cash equivalents $ 1,055,776 $ 1,272,578 Marketable securities 681,323 479,406 Accounts receivable, net of allowances of $5,447 and $2,714 as of December 31, 2021 and December 31, 2020, respectively 340,491 274,255 Prepaid expenses 39,097 32,025 Other current assets 34,423 22,396 Total current assets 2,151,110 2,080,660 Property and equipment, net 106,106 95,544 Operating lease right-of-use assets 98,393 103,609 Goodwill 1,620,127 286,251 Intangible assets, net 814,386 57,459 Restricted cash 10,823 21,369 Other assets 40,401 26,333 Total assets $ 4,841,346 $ 2,671,225 Liabilities and stockholders’ equity Current liabilities: Accounts payable $ 14,009 $ 11,303 Accrued expenses and other current liabilities 144,873 106,306 Publisher payables 237,637 182,269 Income and other taxes payable 64,759 64,116 Deferred revenue 140,528 113,853 Operating lease liabilities 23,729 25,375 Total current liabilities 625,535 503,222 Convertible notes 1,703,035 — Long-term deferred revenue 15,945 20,523 Long-term operating lease liabilities 92,539 98,532 Other long-term liabilities 9,901 11,805 Total liabilities 2,446,955 634,082 Commitments and contingencies Stockholders’ equity: Preferred stock, $0.000005 par value; 100,000 shares authorized, and no shares issued and outstanding as of December 31, 2021; 100,000 shares authorized, no shares issued and outstanding as of December 31, 2020 — — Common stock, $0.000005 par value; 1,000,000 and 1,000,000 shares authorized as of December 31, 2021 and December 31, 2020, respectively; 292,592 and 273,537 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively 2 2 Additional paid-in capital 3,729,874 2,838,057 Accumulated other comprehensive loss (3,858 ) (3,418 ) Accumulated deficit (1,331,627 ) (797,498 ) Total stockholders’ equity 2,394,391 2,037,143 Total liabilities and stockholders’ equity $ 4,841,346 $ 2,671,225 UNITY SOFTWARE INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (In thousands, except per share amounts) (Unaudited) Three Months Ended Year Ended December 31, December 31, 2021 2020 2021 2020 Revenue $ 315,864 $ 220,336 $ 1,110,526 $ 772,445 Cost of revenue 73,654 52,507 253,630 172,347 Gross profit 242,210 167,829 856,896 600,098 Operating expenses Research and development 209,066 120,008 695,710 403,515 Sales and marketing 102,833 68,677 344,939 216,416 General and administrative 75,140 59,991 347,912 254,979 Total operating expenses 387,039 248,676 1,388,561 874,910 Loss from operations (144,829 ) (80,847 ) (531,665 ) (274,812 ) Interest expense (531 ) (117 ) (1,131 ) (1,520 ) Interest income and other expense, net (5 ) (3,056 ) 1,566 (3,885 ) Loss before provision for income taxes (145,365 ) (84,020 ) (531,230 ) (280,217 ) Provision for (benefit from) income taxes 16,288 (518 ) 1,377 2,091 Net loss (161,653 ) (83,502 ) (532,607 ) (282,308 ) Other comprehensive loss, net of taxes: Change in foreign currency translation adjustment 542 29 583 161 Change in unrealized gains (losses) on marketable securities (989 ) 53 (1,023 ) 53 Comprehensive loss $ (162,100 ) $ (83,420 ) $ (533,047 ) $ (282,094 ) Basic and diluted net loss per share: Net loss per share attributable to our common stockholders, basic and diluted $ (0.56 ) $ (0.31 ) $ (1.89 ) $ (1.66 ) Weighted-average shares used in per share calculation attributable to our common stockholders, basic and diluted 288,469 272,134 282,195 169,973 UNITY SOFTWARE INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Three Months Ended December 31, Year Ended December 31, 2021 2020 2021 2020 Operating activities Net loss $ (161,653 ) $ (83,502 ) $ (532,607 ) $ (282,308 ) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization 25,345 11,690 64,567 42,974 Common stock charitable donation expense — — — 63,615 Stock-based compensation expense 97,875 51,102 334,529 134,554 Stock-based compensation expense in connection with modified awards for certain employees 6 67 12,630 75 Other 2,839 1,728 13,843 3,246 Changes in assets and liabilities, net of effects of acquisitions: Accounts receivable, net (38,815 ) (48,576 ) (65,151 ) (63,294 ) Prepaid expenses (7,794 ) (5,958 ) (6,831 ) (9,131 ) Other current assets (9,399 ) (2,902 ) (13,170 ) (12,985 ) Operating lease right-of-use ("ROU") assets 5,913 5,665 23,739 23,923 Deferred tax, net 13,879 (1,922 ) (13,033 ) (213 ) Other assets (92 ) (1,724 ) (6,628 ) (1,867 ) Accounts payable 2,205 1,632 2,022 (2,526 ) Accrued expenses and other current liabilities 10,608 21,935 34,571 41,618 Publisher payables 38,951 31,126 55,368 44,605 Income and other taxes payable (16,617 ) 21,763 (1,296 ) 19,525 Operating lease liabilities (5,647 ) (2,724 ) (26,473 ) (20,204 ) Other long-term liabilities (3,091 ) (4,449 ) (3,282 ) 898 Deferred revenue 5,978 19,814 15,753 37,408 Net cash provided by (used in) operating activities (39,509 ) 14,765 (111,449 ) 19,913 Investing activities Purchase of marketable securities (223,839 ) (482,453 ) (519,698 ) (482,453 ) Proceeds from principal repayments on marketable securities 3,719 1,644 18,572 1,644 Maturities of marketable securities 60,585 — 290,385 — Purchase of non-marketable investments — (1,000 ) (4,600 ) (1,000 ) Purchase of property and equipment (13,979 ) (11,200 ) (41,938 ) (40,156 ) Acquisition of intangible assets — — — (750 ) Business acquisitions, net of cash acquired (1,154,883 ) (17,507 ) (1,580,081 ) (52,475 ) Net cash used in investing activities (1,328,397 ) (510,516 ) (1,837,360 ) (575,190 ) Financing activities Proceeds from issuance of convertible notes 1,725,000 — 1,725,000 — Purchase of capped calls (48,127 ) — (48,127 ) — Proceeds from revolving loan facility — — — 125,000 Payment of principal related to revolving loan facility — — — (125,000 ) Payment of debt issuance costs (22,575 ) — (22,575 ) (247 ) Proceeds from initial public offering, net of underwriting discounts, commissions, and offering costs — (2,563 ) — 1,417,582 Proceeds from issuance of convertible preferred stock, net of issuance costs — — — 149,970 Proceeds from issuance of common stock — — — 100,000 Purchase and retirement of treasury stock — — — (110 ) Proceeds from exercise of stock options 13,554 9,945 66,704 25,404 Proceeds from exercise of stock options in connection with nonrecourse promissory note — — — 8,856 Net cash provided by financing activities 1,667,852 7,382 1,721,002 1,701,455 Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash 401 492 459 673 Increase (decrease) in cash, cash equivalents, and restricted cash 300,347 (487,877 ) (227,348 ) 1,146,851 Cash and restricted cash, beginning of period 766,252 1,781,824 1,293,947 147,096 Cash, cash equivalents, and restricted cash, end of period $ 1,066,599 $ 1,293,947 $ 1,066,599 $ 1,293,947
UNITY SOFTWARE INC. RECONCILIATION BETWEEN GAAP AND NON-GAAP FINANCIAL MEASURES (In thousands, except percentages and per share data) (Unaudited) Three Months Ended Year Ended December 31, December 31, 2021 2020 2021 2020 Gross profit reconciliation GAAP gross profit $ 242,210 $ 167,829 $ 856,896 $ 600,098 Add: Stock-based compensation expense 6,574 4,307 24,811 10,626 Employer tax related to employee stock transactions 1,187 477 5,434 1,117 Amortization of intangible assets expense 2,274 — 2,274 — Non-GAAP gross profit $ 252,245 $ 172,613 $ 889,415 $ 611,841 GAAP gross margin 77 % 76 % 77 % 78 % Non-GAAP gross margin 80 % 78 % 80 % 79 % Operating expenses reconciliation Research and development GAAP research and development expense $ 209,066 $ 120,008 $ 695,710 $ 403,515 Add: Stock-based compensation expense (51,558 ) (23,925 ) (165,604 ) (66,038 ) Employer tax related to employee stock transactions (12,323 ) (2,936 ) (32,529 ) (5,134 ) Amortization of intangible assets expense (10,129 ) (3,106 ) (20,946 ) (12,142 ) Non-GAAP research and development expense $ 135,056 $ 90,041 $ 476,631 $ 320,201 GAAP research and development expense as a percentage of revenue 66 % 54 % 63 % 52 % Non-GAAP research and development expense as a percentage of revenue 43 % 41 % 43 % 41 % Sales and marketing GAAP sales and marketing expense $ 102,833 $ 68,677 $ 344,939 $ 216,416 Add: Stock-based compensation expense (21,935 ) (8,923 ) (70,663 ) (23,769 ) Employer tax related to employee stock transactions (3,202 ) (555 ) (7,898 ) (888 ) Amortization of intangible assets expense (4,768 ) (1,604 ) (10,263 ) (5,613 ) Non-GAAP sales and marketing expense $ 72,928 $ 57,595 $ 256,115 $ 186,146 GAAP sales and marketing expense as a percentage of revenue 33 % 31 % 31 % 28 % Non-GAAP sales and marketing expense as a percentage of revenue 23 % 26 % 23 % 24 % General and administrative GAAP general and administrative expense $ 75,140 $ 59,991 $ 347,912 $ 254,979 Add: Stock-based compensation expense (17,814 ) (14,014 ) (86,081 ) (34,196 ) Employer tax related to employee stock transactions (1,064 ) (908 ) (4,713 ) (1,037 ) Lease termination expense — — (49,795 ) — Charitable contribution to donor-advised fund — — — (63,615 ) Non-GAAP general and administrative expense $ 56,262 $ 45,069 $ 207,323 $ 156,131 GAAP general and administrative expense as a percentage of revenue 24 % 27 % 31 % 33 % Non-GAAP general and administrative expense as a percentage of revenue 18 % 20 % 19 % 20 % Loss from operations reconciliation GAAP loss from operations $ (144,829 ) $ (80,847 ) $ (531,665 ) $ (274,812 ) Add: Stock-based compensation expense 97,881 51,169 347,159 134,629 Employer tax related to employee stock transactions 17,776 4,876 50,574 8,176 Amortization of intangible assets expense 17,171 4,710 33,483 17,755 Lease termination expense — — 49,795 — Charitable contribution to donor-advised fund — — — 63,615 Non-GAAP loss from operations $ (12,001 ) $ (20,092 ) $ (50,654 ) $ (50,637 ) GAAP operating margin (46 ) % (37 ) % (48 ) % (36 ) % Non-GAAP operating margin (4 ) % (9 ) % (5 ) % (7 ) % Net loss and net loss per share reconciliation GAAP net loss $ (161,653 ) $ (83,502 ) $ (532,607 ) $ (282,308 ) Add: Stock-based compensation expense 97,881 51,169 347,159 134,629 Employer tax related to employee stock transactions 17,776 4,876 50,574 8,176 Amortization of intangible assets expense 17,171 4,710 33,483 17,755 Lease termination expense — — 49,795 — Charitable contribution to donor-advised fund — — — 63,615 Income tax effect of non-GAAP adjustments 13,530 (4,474 ) (10,182 ) (7,437 ) Non-GAAP net loss $ (15,295 ) $ (27,221 ) $ (61,778 ) $ (65,570 ) GAAP net loss per share attributable to our common stockholders, basic and diluted $ (0.56 ) $ (0.31 ) $ (1.89 ) $ (1.66 ) Total impact on net loss per share, basic and diluted, from non-GAAP adjustments 0.51 0.21 1.67 1.27 Non-GAAP net loss per share attributable to our common stockholders, basic and diluted $ (0.05 ) $ (0.10 ) $ (0.22 ) $ (0.39 ) Weighted-average common shares used in GAAP net loss per share computation, basic and diluted 288,469 272,134 282,195 169,973 Weighted-average common shares used in non-GAAP net loss per share computation, basic and diluted 288,469 272,134 282,195 169,973 Free cash flow reconciliation Net cash provided by (used in) operating activities $ (39,509 ) $ 14,765 $ (111,449 ) $ 19,913 Less: Purchase of property and equipment (13,979 ) (11,200 ) (41,938 ) (40,156 ) Free cash flow $ (53,488 ) $ 3,565 $ (153,387 ) $ (20,243 ) Net cash used in investing activities $ (1,328,397 ) $ (510,516 ) $ (1,837,360 ) $ (575,190 ) Net cash provided by financing activities $ 1,667,852 $ 7,382 $ 1,721,002 $ 1,701,455