SUPPLEMENTAL BALANCE SHEET INFORMATION

9 Months Ended

Sep. 30, 2024

Balance Sheet Related Disclosures [Abstract]

Cash, cash equivalents and restricted cash

Cash and cash equivalents include cash on hand and all liquid investments with a maturity of three months or less when purchased. We regularly maintain cash balances with financial institutions in excess of the Federal Deposit Insurance Corporation insurance limit or the equivalent outside the U.S. As of September 30, 2024, approximately 75% of our total balance of cash and cash equivalents was held within a small group of financial institutions, primarily large money center banks. Although we currently believe that the financial institutions with whom we do business will be able to fulfill their commitments to us, there is no assurance that those institutions will be able to continue to do so. We have not experienced any losses associated with our balances in such accounts for the three and nine months ended September 30, 2024 and 2023.

Restricted cash includes amounts that cannot be withdrawn or used for general operating activities under legal or regulatory restrictions. Restricted cash consists of amounts under legal restriction, amounts deposited by customers for prepaid card transactions and funds held as a liquidity reserve that are subject to local regulatory restrictions requiring appropriate segregation and restriction in their use. Restricted cash is included in prepaid expenses and other current assets in the consolidated balance sheets with a corresponding liability in accounts payable and accrued liabilities.

A reconciliation of the amounts of cash and cash equivalents and restricted cash in the consolidated balance sheets to the amount in the consolidated statements of cash flows is as follows:


	September 30, 2024		December 31, 2023

	(in thousands)
Cash and cash equivalents	$	2,941,940	$	2,088,887
Restricted cash	197,575		167,190
Cash included in assets held for sale	—		798
Cash, cash equivalents and restricted cash shown in the statements of cash flows	$	3,139,515	$	2,256,875

Long-lived assets

As a result of decisions made in the third quarter of 2024 regarding the future state of our technology architecture model, we wrote off capitalized software assets of $27.3 million and capitalized cloud implementation cost assets of $28.5 million that will no longer be utilized under a revised development strategy. These charges for the three and nine months ended September 30, 2024 are presented within selling, general and administrative expenses in our consolidated statements of income and included within Corporate expenses for segment reporting purposes.

During the three and nine months ended September 30, 2024, we entered into agreements to acquire hardware, of which $10.1 million was financed under a four-year vendor financing arrangement.

During the three and nine months ended September 30, 2023, we entered into agreements to acquire hardware, software and related services, of which $19.6 million and $67.6 million, respectively, was financed under four to five-year vendor financing arrangements. Certain of the agreements included the purchase of assets previously leased.

Visa preferred shares

Through certain of our subsidiaries in Europe, we were a member and shareholder of Visa Europe Limited ("Visa Europe"). In June 2016, Visa Inc. ("Visa") acquired all of the membership interests in Visa Europe, and we received consideration in the form of cash and Series B and C convertible preferred shares of Visa. We assigned the preferred shares received a value of zero based on transfer restrictions, Visa's ability to adjust the conversion rate and the estimation uncertainty associated with those factors. Based on the outcome of any current or potential litigation involving Visa Europe in the United Kingdom and elsewhere in Europe, the conversion rate of the preferred shares could be adjusted down such that the number of Visa common shares we receive could be as low as zero.

The Series B and C convertible preferred shares become convertible in stages based on developments in the litigation and become fully convertible no later than 2028 (subject to a holdback to cover any then pending claims). In July 2024, in connection with the third mandatory release assessment, a portion of the Series B and C convertible preferred shares was converted by Visa. We recognized a gain of $18.8 million reported in interest and other income in our consolidated statement of income for the three and nine months ended September 30, 2024 based on the fair value of the shares received. The converted shares were subsequently sold in September and October 2024. The remaining Series B and C convertible preferred shares continue to be carried at an assigned value of zero based on the aforementioned factors.

Accounts payable and accrued liabilities

In 2024, certain actions were taken to align our workforce to our new operating model. During the three months ended September 30, 2024, we recognized charges for employee termination benefits of $56.4 million, which included $15.5 million of share-based compensation expense. During the nine months ended September 30, 2024, we recognized charges for employee termination benefits of $94.1 million, which included $18.2 million of share-based compensation expense. These charges are presented within selling, general and administrative expenses in our consolidated statements of income and included within Corporate expenses for segment reporting purposes. At September 30, 2024, accounts payable and accrued liabilities in the consolidated balance sheet included obligations totaling $34.1 million for employee termination benefits, which are expected to be paid within the next 12 months.