Noncash Share-based Compensation (Note)

3 Months Ended

Mar. 31, 2024

Noncash Share-based Compensation [Abstract]

The Company's 2017 Equity Incentive Plan (as amended and restated, the "2017 Stock Plan") had an aggregate authorized limit of 7,650,000 shares for issuance. In May 2023, the Company's stockholders approved an amendment to the 2017 Stock Plan increasing the aggregate amount of shares available for issuance to 10,550,000. As of March 31, 2024, 3,281,287 shares remain available for issuance under the 2017 Stock Plan.

The following table presents the number of shares or units outstanding for each award type as of March 31, 2024 and December 31, 2023 (in thousands):


Award type	March 31, 2024	December 31, 2023

Restricted stock units (time-based)	3,212	2,767



Market stock units	391	358

During the three months ended March 31, 2024, the Company granted 1,196,087 RSUs (time-based) with a weighted average grant-date fair value of $35.69 per share. The Company also granted 131,892 MSUs with a weighted average grant-date fair value of $41.07 to certain executive employees during the three months ended March 31, 2024. These MSUs vest on January 31, 2027 and the actual number of MSUs that will be eligible to vest is based on the total stockholder return of the Company relative to the total stockholder return of the Index over the performance period, as defined by each award's plan documents or individual award agreements. The maximum number of shares issuable upon vesting is 200% of the MSUs initially granted.

The assumptions used to value the MSUs granted during the three months ended March 31, 2024 were as follows:


	Three Months Ended March 31, 2024
Volatility	50.94	%
Risk-free interest rate	3.89	%
Expected award life in years	2.97
Dividend yield	—	%

Share-based compensation expense is allocated to expense categories in the unaudited condensed consolidated statements of comprehensive loss. The following table summarizes share-based compensation expense included in the

Company's unaudited condensed consolidated statements of comprehensive loss for the three months ended March 31, 2024 and 2023 (in thousands):


	Three Months Ended March 31,
		2024		2023
Share-based compensation:
Cost of revenue		$	1,068	$	832
Operating expenses:
Selling and marketing		3,628		2,928
Research and development		3,531		2,350
General and administrative		4,473		3,794
Total included in operating expenses		11,632		9,072
Total share-based compensation expense		$	12,700	$	9,904

At March 31, 2024, the Company had an estimated $100.0 million of total unrecognized compensation costs related to share-based compensation arrangements. These costs will be recognized over a weighted average period of 2.8 years.

The Company's Employee Stock Purchase Plan (as amended, the "ESPP") permits eligible employees to purchase Company shares on an after-tax basis in an amount between 1% and 10% of their annual pay: (i) on June 30 of each year at a 15% discount of the fair market value of the Company's common stock on January 1 or June 30, whichever is lower, and (ii) on December 31 of each year at a 15% discount of the fair market value of the Company's common stock on July 1 or December 31, whichever is lower. An employee may not purchase more than $5,000 in either of the six-month measurement periods described above or more than $10,000 annually. In May 2021, the Company's stockholders approved an amendment to the ESPP increasing the aggregate amount of shares available for issuance under the ESPP to 1,000,000. During the three months ended March 31, 2024, the Company issued 40,408 shares under the ESPP. As of March 31, 2024, 242,709 shares remain authorized and available for issuance under the ESPP. As of March 31, 2024, the Company held approximately $0.7 million on behalf of employees for future purchases under the ESPP, and this amount was recorded in accrued payroll and other employee benefits in the Company's unaudited condensed consolidated balance sheet.