Supplemental Financial Statement Information

3 Months Ended

Mar. 31, 2022

Additional Financial Information Disclosure [Abstract]

Supplemental Financial Statement Information

Cash Equivalents and Short-Term Investments

The following tables summarize the cost or amortized cost, gross unrealized gain, gross unrealized loss and fair value of the Company’s cash equivalents and short-term investments as of the dates indicated (in thousands):


	March 31, 2022
	Cost or Amortized Cost		Unrealized				Estimated Fair Value
			Gains		Losses
Unrestricted Balances(1)
Money market funds	$	10,824	$	—	$	—	$	10,824
Money market deposit accounts	115,099		—		—		115,099
Term deposits	210,000		—		—		210,000
Certificates of deposit	481,555		13		(1,440)		480,128
Commercial paper	1,198,296		3		(3,970)		1,194,329
Corporate bonds	165,693		—		(611)		165,082
U.S. government securities	3,098		—		(3)		3,095
Total unrestricted cash equivalents and short-term investments	2,184,565		16		(6,024)		2,178,557
Restricted Balances(2)
Money market funds	11,868		—		—		11,868
Term deposits	5,046		—		—		5,046
Certificates of deposit	281,852		3		(775)		281,080
Commercial paper	486,896		—		(1,854)		485,042
Corporate bonds	65,900		—		(158)		65,742
U.S. government securities	46,300		—		(202)		46,098
Total restricted cash equivalents and investments	897,862		3		(2,989)		894,876
Total unrestricted and restricted cash equivalents and investments	$	3,082,427	$	19	$	(9,013)	$	3,073,433

_______________

(1)Excludes $48.1 million of cash and $9.8 million of marketable equity securities, which are included within the $2.2 billion of cash and cash equivalents and short-term investments on the condensed consolidated balance sheets.

(2)Excludes $53.2 million of restricted cash, which is included within the $948.1 million of restricted cash and cash equivalents and restricted short-term investments on the condensed consolidated balance sheets.


	December 31, 2021
	Cost or Amortized Cost		Unrealized				Estimated Fair Value
			Gains		Losses
Unrestricted Balances(1)
Money market funds	$	22,250	$	—	$	—	$	22,250
Money market deposit accounts	330,252		—		—		330,252
Term deposits	385,000		—		—		385,000
Certificates of deposit	505,562		25		(149)		505,438
Commercial paper	806,446		132		(190)		806,388
Corporate bonds	99,779		4		(78)		99,705
Total unrestricted cash equivalents and short-term investments	2,149,289		161		(417)		2,149,033
Restricted Balances(2)
Money market funds	20,161		—		—		20,161
Term deposits	5,046		—		—		5,046
Certificates of deposit	421,243		35		(134)		421,144
Commercial paper	523,616		43		(169)		523,490
Corporate bonds	63,506		—		(48)		63,458
U.S. government securities	31,745		—		(28)		31,717
Total restricted cash equivalents and investments	1,065,317		78		(379)		1,065,016
Total unrestricted and restricted cash equivalents and investments	$	3,214,606	$	239	$	(796)	$	3,214,049

_______________

(1)Excludes $104.8 million of cash, which is included within the $2.3 billion of cash and cash equivalents and short-term investments on the condensed consolidated balance sheets.

(2)Excludes $53.7 million of restricted cash, which is included within the $1.1 billion of restricted cash and cash equivalents and restricted short-term investments on the condensed consolidated balance sheets.

The Company’s short-term investments consist of available-for-sale debt securities and term deposits. The term deposits are at cost, which approximates fair value.

The weighted-average remaining maturity of the Company’s investment portfolio was less than one year as of the periods presented. No individual security incurred continuous unrealized losses for greater than 12 months.

The Company purchases investment grade marketable debt securities which are rated by nationally recognized statistical credit rating organizations in accordance with its investment policy. This policy is designed to minimize the Company's exposure to credit losses. As of March 31, 2022, the credit-quality of the Company’s marketable available-for-sale debt securities had remained stable. The unrealized losses recognized on marketable available-for-sale debt securities as of March 31, 2022 was primarily related to the continued market volatility associated with market expectations of an aggressive pace of interest rate increases by the Federal Reserve. The contractual terms of these investments do not permit the issuer to settle the securities at a price less than the amortized cost basis of the investments and it is not expected that the investments would be settled at a price less than their amortized cost basis. The Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis. The Company is not aware of any specific event or circumstance that would require the Company to change its assessment of credit losses for any marketable available-for-sale debt security as of March 31, 2022. These estimates may change, as new events occur and additional information is obtained, and will be recognized on the condensed consolidated financial statements as soon as they become known. No credit losses were recognized as of March 31, 2022 for the Company’s marketable and non-marketable debt securities.

The following table summarizes the Company’s available-for-sale debt securities in an unrealized loss position for which no allowance for credit losses was recorded, aggregated by major security type (in thousands):


	March 31, 2022
	Estimated Fair Value		Unrealized Losses
Certificates of deposit	$	703,093	$	(2,215)
Corporate bonds	230,825		(769)
Commercial paper	1,617,500		(5,824)
U.S. government securities	49,192		(205)
Total available-for-sale debt securities in an unrealized loss position	$	2,600,610	$	(9,013)

Accrued and Other Current Liabilities

Accrued and other current liabilities consisted of the following as of the dates indicated (in thousands):


	March 31, 2022		December 31, 2021
Legal accruals	$	368,640	$	349,518
Insurance-related accruals	345,740		336,340
Ride-related accruals	198,807		196,716
Deferred gain related to the Reinsurance Transaction (1)	108,053		52,785
Long-term debt, current	55,921		56,264
Insurance claims payable and related fees	27,985		33,696
Other	258,873		239,107
Accrued and other current liabilities	$	1,364,019	$	1,264,426

_______________

(1)Refer to Note 2 “ Summary of Significant Accounting Policies” above and the rest of this Note 4 “Supplemental Financial Information - Insurance Reserves” below for more information on this deferred gain.

Insurance Reserves

The following table provides a rollforward of the insurance reserve for the periods presented (in thousands):


	Three Months Ended March 31,
	2022		2021
Balance at beginning of period	$	1,068,628	$	987,064
Reinsurance recoverable at beginning of period	(245,179)		—
Additions related to:
Reserves for current period	55,110		64,468
Change in estimates for prior periods	—		128,045
Losses paid	(102,830)		(121,161)
Transfer of certain legacy auto insurance liabilities	—		—
Net balance at the end of the period	775,729		1,058,416
Add: Reinsurance recoverable at the end of the period	290,152		—
Balance at end of period	$	1,065,881	$	1,058,416

Reinsurance of Certain Legacy Auto Liability Insurance

On April 22, 2021, the Company’s wholly-owned subsidiary, Pacific Valley Insurance Company, Inc. (“PVIC”), entered into a Quota Share Reinsurance Agreement (the “Reinsurance Agreement”) with DARAG Bermuda LTD (“DARAG”), under which DARAG reinsured a legacy portfolio of auto insurance policies, based on reserves in place as of March 31, 2021, for $183.2 million of coverage above the liabilities recorded as of that date. Under the terms of the Reinsurance Agreement, PVIC ceded to DARAG approximately $251.3 million of certain legacy insurance liabilities for policies underwritten during the period of October 1, 2018 to October 1, 2020, with an aggregate limit of $434.5 million, for a premium of $271.5 million (“the Reinsurance Transaction”). The Reinsurance Agreement is on a funds withheld basis, meaning that funds are withheld by PVIC from the insurance premium owed to DARAG in order to pay future reinsurance claims on DARAG’s behalf. Upon consummation of the Reinsurance Transaction, a reinsurance recoverable of $251.3 million was established, and since a contractual right of offset exists, the reinsurance recoverable has been netted against the funds withheld liability balance of

$271.5 million for a $20.2 million net funds withheld liability balance included in accrued and other current liabilities on the condensed consolidated balance sheet. In addition to the initial funds withheld balance of $271.5 million, additional coverage of certain legacy insurance liabilities is collateralized by a trust account established by DARAG for the benefit of PVIC, which was $75.0 million upon consummation. As of March 31, 2022, the balance of the net funds withheld liability is zero. At the inception of the Reinsurance Agreement, a loss of approximately $20.4 million for the total cost of the Reinsurance Transaction was recognized on the condensed consolidated statement of operations for the year ended December 31, 2021, with $20.2 million in cost of revenue and $0.2 million in general and administrative expenses.

The Reinsurance Transaction does not discharge PVIC of its obligations to the policyholder. Management evaluated reinsurance counterparty credit risk and does not consider it to be material since the premium of $271.5 million was retained by PVIC on a funds withheld basis on behalf of the reinsurer.

As of March 31, 2022, the Company has $108.1 million of deferred gains related to losses ceded under the Reinsurance Agreement which are included within accrued and other current liabilities on the consolidated balance sheets. The reinsurance recoverable receivable from DARAG, net of the funds withheld liability, is included in prepaid expenses and other current assets on the consolidated balance sheets.

Other Income (Expense), Net

The following table sets forth the primary components of other income (expense), net as reported on the condensed consolidated statements of operations (in thousands):


	Three Months Ended March 31,
	2022		2021
Interest income	$	2,654	$	2,879
Gain (loss) on sale of securities, net	1		701
Foreign currency exchange gains (losses), net	77		(588)
Sublease income	3,714		—

Other, net	3,317		613
Other income (expense), net	$	9,763	$	3,605