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Long-Term Debt
 12 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
Long-Term Debt Note 6. Long-Term Debt
The following table sets forth the net carrying amount of the Company’s long-term debt (in thousands):
Debt InstrumentMaturity DateDecember 31, 2024December 31, 2023
2030 Senior Notes
August 15, 2030$400,000 $400,000 
Term Loan under Credit Agreement (1)
February 14, 2028370,000 390,000 
Revolving Credit Facility under Credit Agreement (2)
February 14, 2028— — 
2026 Convertible NotesMarch 15, 2026609,065 609,065 
2025 Convertible NotesMarch 1, 2025161,326 161,326 
Total principal amount1,540,391 1,560,391 
Less: unamortized debt discount and issuance costs on long-term debt(11,258)(14,909)
Less: current portion of long-term debt, net (3)
(181,252)(20,000)
Net carrying amount of long-term debt$1,347,881 $1,525,482 
(1)The Company has $350.0 million available for drawdown under the Term Loan as of December 31, 2024.
(2)The Company has $225.0 million available for borrowing under the Revolving Credit Facility as of December 31, 2024.
(3)The current portion of long-term debt, net as of December 31, 2024 relates to $161.3 million net carrying amount from the 2025 Convertible Notes, and $20.0 million of expected principal payments due on the Term Loan. The Term Loan requires quarterly principal payments of 1.25% of the $400.0 million principal amount drawn, with balance due at maturity.
The following table sets forth the future minimum principal payments for long-term debt as of December 31, 2024 (in thousands):
2025 Convertible Notes2026 Convertible NotesTerm Loan2030 Senior NotesTotal
2025$161,326 $— $20,000 $— $181,326 
2026— 609,065 20,000 — 629,065 
2027— — 20,000 — 20,000 
2028— — 310,000 — 310,000 
2029 onwards— — — 400,000 400,000 
Total principal amount$161,326 $609,065 $370,000 $400,000 $1,540,391 
2030 Senior Notes
In August 2023, the Company issued $400.0 million aggregate principal amount of the 2030 Senior Notes in a private offering. The 2030 Senior Notes are senior unsecured obligations of the Company and bear interest at a fixed rate of 8.5% per annum payable semi-annually in arrears on February 15th and August 15th of each year. The 2030 Senior Notes are guaranteed by the Company’s domestic subsidiaries and are subject to certain covenants and redemption provisions outlined in the indenture governing the 2030 Senior Notes (the “Senior Notes Indenture”). As of December 31, 2024, the carrying value of the outstanding 2030 Senior Notes, net of unamortized debt discount and issuance costs, was $393.1 million, and the Company was in compliance with all covenants under the Senior Notes Indenture. The effective interest rate on the 2030 Senior Notes was 8.9% as of December 31, 2024.
Credit Agreement
In February 2023, the Company entered into a credit agreement with certain lenders, from time to time party thereto and Bank of America, N.A., as administrative agent and as collateral agent (as amended, the “Credit Agreement”), providing for a $200.0 million revolving credit facility (the “Revolving Credit Facility”) and a $400.0 million term loan (the “Term Loan”). In the second quarter of 2023, the Company drew down the initial $400.0 million Term Loan and used the proceeds to repurchase a portion of the 2025 Convertible Notes. The credit facilities were subsequently amended in 2023 and 2024 to increase the Revolving Credit Facility to $225.0 million and the Term Loan to $750.0 million. The proceeds from the Revolving Credit Facility can be used for working capital and general corporate purposes, while the remaining $350.0 million tranches of the Term Loan can be used to repurchase a portion of the Company’s convertible notes and for working capital and general corporate purposes. The credit facilities are guaranteed by certain material domestic subsidiaries of the Company, and secured by substantially all of the personal property of the Company and such subsidiary guarantors. If on any date that is within 91 days prior to the final scheduled maturity date of any series of the Convertible Notes (defined below), such series of Convertible Notes is in an aggregate principal amount outstanding that exceeds an amount equal to 50% of last twelve months EBITDA, calculated as set forth in the Credit Agreement, the maturity date of both the Revolving Credit Facility and Term Loan shall automatically be modified to be such date. As of December 31, 2024, $350.0 million of the Term Loan remains available for draw until May 2025. Additionally, the $225.0 million Revolving Credit Facility commitments remains available for draw until February 14, 2028, at which time it will terminate, and all outstanding revolving loans under the facility will be due and payable. The Company will continue to pay a quarterly ticking fee of up to 0.500% per annum on the daily unused amount of the Term Loan and Revolving Credit Facility commitments until the earlier of the funding or the end of the availability period. Any drawdown under the Credit Agreement would be subject to compliance with the restrictive covenants in the Senior Notes Indenture.
Borrowings under the Credit Agreement will bear interest, at the Company’s option, at either: (a) the fluctuating rate per annum equal to the greatest of (i) the prime rate then in effect, (ii) the federal funds rate then in effect, plus 0.5% per annum, (iii) an adjusted term Secured Overnight Financing Rate (“SOFR”) determined on the basis of a one-month interest period, plus 1.0% and (iv) 1.0%, in each case, plus a margin of between 0.75% and 2.0%; and (b) an adjusted term SOFR rate (based on one, three or six month interest periods), plus a margin of between 1.75% and 3.0%. The applicable margin in each case is determined based on the Company’s total net leverage ratio and varies between tranches of Term Loans. Interest is payable quarterly in arrears with respect to borrowings bearing interest at the alternate base rate or on the last day of an interest period, but at least every three months, with respect to borrowings bearing interest at the term SOFR rate.
As of December 31, 2024, the carrying value of the Term Loan, net of unamortized debt discount and issuance costs, was $367.7 million. As of December 31, 2024, the Company incurred $9.8 million of debt issuance costs in connection with the Credit Agreement, of which $7.0 million was capitalized in the Consolidated Balance Sheets and amortized primarily using the effective interest rate over the term of the Credit Agreement, while the remaining amount was expensed in the period incurred. As of December 31, 2024, the effective interest rate on the Term Loan was 7.4%. As of December 31, 2024, the Company was in compliance with all covenants under the Credit Agreement.
Convertible Notes
In March 2020, the Company issued $1.0 billion of the 2025 Convertible Notes, and in September 2020, it issued $650.0 million of the 2026 Convertible Notes. The Convertible Notes are senior, unsecured obligations that do not bear regular interest and the principal amount of the Convertible Notes does not accrete. As of December 31, 2024, the carrying values of the 2025 and 2026 Convertible Notes, net of unamortized debt issuance costs, were $161.3 million and $607.0 million, respectively, and the Company was in compliance with all covenants under the Convertible Notes Indentures.
Other Terms of the Notes
2025 Convertible Notes2026 Convertible Notes
$1,000 principal amount initially convertible into number of the Company’s Class A Common Stock par value $0.0001
2.7745 shares
2.3583 shares
Equivalent initial approximate conversion price per share
$360.43 $424.03 
During the three months and twelve months ended December 31, 2024 and prior to December 1, 2024, the conditions allowing holders of the 2025 Convertible Notes to convert were not met. On or after December 1, 2024 until the close of business on the scheduled trading day immediately preceding the maturity date, holders of the 2025 Convertible Notes may convert their 2025 Convertible Notes at any time. During the three months and twelve months ended December 31, 2024, the conditions allowing holders of the 2026 Convertible Notes to convert were not met. The 2026 Convertible Notes may be convertible thereafter if one or more of the conversion conditions specified in the indenture governing the 2026 Convertible Notes is satisfied during future measurement periods.
Partial Repurchase of 2025 and 2026 Convertible Notes
In May 2023, the Company used the entire proceeds from the drawdown of the $400.0 million Term Loan and $27.3 million of other available cash to repurchase $460.7 million principal amount of the 2025 Convertible Notes, resulting in a gain on early debt extinguishment of $31.1 million, net of related unamortized debt issuance costs.
In August 2023, the Company used a portion of the net proceeds from the offering of the 2030 Senior Notes to repurchase $125.3 million and $40.9 million principal of the 2025 Convertible Notes and 2026 Convertible Notes, respectively, by paying an aggregate amount of $153.6 million in cash, resulting in a gain on early debt extinguishment of $11.8 million, net of related unamortized debt issuance costs.
In December 2023, the Company used a portion of the remaining net proceeds from the offering of the 2030 Senior Notes to repurchase $252.7 million principal of the 2025 Convertible Notes by paying $241.3 million in cash, resulting in a gain of early debt extinguishment in the amount of $10.5 million, net of related unamortized debt issuance costs.
Capped Calls
In connection with the offering of the 2026 Convertible Notes, the Company entered into privately-negotiated capped call transactions with certain counterparties (the “Capped Calls”). The initial strike price of the 2026 Convertible Notes corresponds to the initial conversion price of the 2026 Convertible Notes. The Capped Calls are generally intended to reduce or offset the potential dilution to the Class A Common Stock upon any conversion of the 2026 Convertible Notes with such reduction or offset, as the case may be, subject to a cap based on the cap price.
The following table below sets forth key terms and costs incurred for the outstanding Capped Calls:
2026 Convertible Notes
Initial approximate strike price per share, subject to certain adjustments$424.03 
Initial cap price per share, subject to certain adjustments$556.10 
Net cost incurred (in millions)$41.8 
Class A Common Stock covered, subject to anti-dilution adjustments (in millions)1.5
Settlement commencement date2/13/2025
Settlement expiration date3/13/2025
The following table sets forth the interest expense recognized related to long-term debt (in thousands):
Twelve Months Ended December 31,
202420232022
Contractual interest expense$59,138 $29,285 $— 
Amortization of debt discount and issuance costs4,272 4,566 4,468 
Total interest expense related to long-term debt$63,410 $33,851 $4,468 
The following table sets forth the future minimum contractual interest for long-term debt as of December 31, 2024 (in thousands):
Term Loan (1)
2030 Senior NotesTotal
2025$23,160 $34,000 $57,160 
202621,882 34,000 55,882 
202720,605 34,000 54,605 
20282,421 34,000 36,421 
2029 onwards— 68,000 68,000 
Total contractual interest amount$68,068 $204,000 $272,068 
(1)Includes the impact of interest rate swap. Refer to Note 7 - Derivative Instruments in this Annual Report on Form 10-K for additional information.