v3.22.2.2
COMMON STOCK AND STOCKHOLDERS' (DEFICIT) EQUITY
 9 Months Ended
Sep. 30, 2022
Equity [Abstract]  
COMMON STOCK AND STOCKHOLDERS' (DEFICIT) EQUITY
NOTE 11: COMMON STOCK AND STOCKHOLDERS' (DEFICIT) EQUITY
Preferred Stock
As of September 30, 2022, no terms of the preferred stock had been designated, no shares of preferred stock were outstanding, and we had no present plan to issue any shares of preferred stock.
Common Stock
We have three authorized classes of common stock: Class A, Class B, and Class C. Holders of our Class A common stock are entitled to one vote per share on all matters to be voted upon by our stockholders, holders of our Class B common stock are entitled to 10 votes per share on all matters to be voted upon by our stockholders and, except as otherwise required by applicable law, holders of our Class C common stock are not entitled to vote on any matter to be voted upon by our stockholders. The holders of our Class A common stock and Class B common stock vote together as a single class, unless otherwise required by our Charter or applicable law.
The convertible notes issued in February 2021 (see Note 7 for further information) were converted into 137.3 million shares of Class A common stock at a conversion price of $26.60 per share upon completion of our IPO.
Warrants
As of September 30, 2022, warrants outstanding consisted of warrants to purchase 14.3 million shares of Class A common stock with a strike price of $26.60 per share for a maximum purchase amount of $380 million. The warrants expire on February 12, 2031 and can be exercised in cash or for net shares
at the holder’s option. As of September 30, 2022, the warrants have not been exercised and are included as a component of additional paid in capital on the unaudited condensed consolidated balance sheets.
Equity Incentive Plans
Amended and Restated 2013 Stock Plan and 2020 Equity Incentive Plan
Our Amended and Restated 2013 Stock Plan, as amended (the “2013 Plan”), and our 2020 Equity Incentive Plan, as amended (the “2020 Plan”), provided for share-based awards to eligible participants, granted as incentive stock options (“ISOs”), non-statutory stock options (“NSOs”), restricted stock units ("RSUs"), stock appreciation rights (“SARs”) or restricted stock awards (“RSAs”). Our 2013 Plan was terminated in connection with adoption of our 2020 Plan, and our 2020 Plan was terminated in connection with the adoption of our 2021 Plan (defined below) but any awards outstanding under our 2013 Plan and 2020 Plan remain in effect in accordance with their terms. Any shares that were or otherwise would become available for grant under the 2013 Plan or 2020 Plan will be available for grant under the 2021 Plan. No new awards may be granted under our 2013 Plan or 2020 Plan.
2021 Omnibus Incentive Plan
Our 2021 Omnibus Incentive Plan (the “2021 Plan”) became effective on July 27, 2021, and provides for the grant of share-based awards (such as options, including ISOs and NSOs, SARs, RSAs, RSUs, performance units, and other equity-based awards) and cash-based awards.
As of September 30, 2022, an aggregate of 360 million shares had been authorized for issuance under the 2013 Plan, 2020 Plan, and 2021 Plan, of which 90 million shares had been issued under the plans, 146 million shares were reserved for issuance upon the exercise or settlement of outstanding equity awards under the plans, and 123 million shares remained available for new grants under the 2021 Plan.
Stock Option Activity
A summary of stock option activity for the nine months ended September 30, 2022 is as follows:
Number of SharesWeighted-Average Exercise PriceWeighted- Average Remaining Life
Total Intrinsic Value
(in millions)
Balance at December 31, 202114,527,468$2.20 5.37$226 
Granted during the period4,463,248 14.15 
Exercised during the period(2,272,363)2.22 
Cancelled and forfeited during the period(812,778)12.90 
Balance at September 30, 202215,905,575 $5.01 4.93$96 
Options vested and expected to vest at September 30, 202215,905,575$5.01 4.93$96 
Options exercisable at September 30, 202211,916,639$2.05 4.58$96 
Time-Based RSUs
We grant RSUs that vest upon the satisfaction of a time-based service condition (“Time-Based RSUs”). The following table summarizes the activity related to our Time-Based RSUs for the nine months ended September 30, 2022:
Number of RSUsWeighted- average grant date fair value
Unvested at December 31, 202149,428,070 $31.78 
Granted59,499,760 11.70 
Vested(17,524,831)23.37 
Forfeited(19,475,105)25.88 
Unvested at September 30, 202271,927,894 $18.81 
Market-Based RSUs
In 2019 and 2021, we granted to our founders RSUs under which vesting is conditioned upon both the achievement of share price targets and the continued employment by each recipient over defined service periods (“Market-Based RSUs”). The following table summarizes the activity related to our Market-Based RSUs for the nine months ended September 30, 2022:
Eligible to Vest(1)
Not Eligible to Vest(2)
Total Number of RSUsWeighted- average grant date fair value
Unvested at December 31, 20211,267,918 57,650,926 58,918,844 $23.50 
Granted— — — 
Vested(345,796)— (345,796)2.34 
Forfeited— — — 
Unvested at September 30, 2022922,122 57,650,926 58,573,048 $23.63 
________________
(1)Represents RSUs that became eligible to vest upon achievement of share price targets and vest upon satisfaction of time-based service requirements.
(2)Represents RSUs that have not yet become eligible to vest because share price targets have not yet been achieved.

Share-Based Compensation
The following table presents share-based compensation on our unaudited condensed consolidated statements of operations for the periods indicated:
Three Months Ended
September 30,		Nine Months Ended
September 30,
(in millions)2021202220212022
Brokerage and transaction$6 $2 $6 $4 
Technology and development 503 25 505 166 
Operations 16 — 16 5 
Marketing41 — 41 3 
General and administrative678 83 686 316 
Total$1,244 $110 $1,254 $494 
The following table presents share-based compensation by award type for the periods indicated:
Three Months Ended
September 30,		Nine Months Ended
September 30,
(in millions)2021202220212022
Time-Based RSUs$881 $27 $889 $235 
Market-Based RSUs360 79 360 245 
Employee Share Purchase Plan (“ESPP”)2 2 2 9 
Options1 2 3 5 
Total$1,244 $110 $1,254 $494 
The April 2022 Restructuring and the August 2022 Restructuring resulted in net reductions of $24 million and $53 million in share-based compensation expense, recognized in the three months ended June 30, 2022 and September 30, 2022, respectively. Both reductions were substantially all related to Time-Based RSUs. The net reductions were primarily recognized in technology and development expense, $16 million and $22 million, and general and administrative expense, $6 million and $28 million.
We capitalized share-based compensation expense related to internally developed software of $4 million and $21 million during the three and nine months ended September 30, 2022. The corresponding amount during the three and nine months ended September 30, 2021 was $20 million in both periods.
As of September 30, 2022, there was $1.4 billion of unrecognized share-based compensation expense that is expected to be recognized over a weighted-average period of 2.1 years. Scheduled vesting for awards outstanding as of September 30, 2022, is as follows:
(in millions, except for number of shares)
Number of Shares(1)
Expense
Remainder of 20228,513,485 $194 
202328,262,503 577 
202420,943,065 378 
202514,571,511 253 
20264,565,337 48 
Total76,855,901 $1,450 
________________
(1) Excludes future ESPP shares and Market-Based RSUs for which the share price target has not been met as we cannot forecast the vesting of these shares.
The above schedule describes awards actually outstanding on September 30, 2022, without any adjustments for potential subsequent forfeitures, which are recognized as they occur, or subsequent equity grants.