Document
false0001725579 0001725579 2020-07-29 2020-07-29
 
 
 


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________
FORM 8-K
_______________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
 
Date of Report (date of earliest event reported)
July 29, 2020
_______________________________________
PLURALSIGHT, INC.
(Exact name of registrant as specified in its charter)
_______________________________________
Delaware
001-38498
82-3605465
(State or other jurisdiction of incorporation or organization)
(Commission File Number)

(I.R.S. Employer Identification Number)


182 North Union Avenue
Farmington, Utah 84025
(Address of principal executive offices)

(801) 784-9007
(Registrant's telephone number, including area code)
 
 


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Class A Common Stock, $0.0001, par value per share
 
PS
 
The Nasdaq Global Select Market
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 
 
 



Item 2.02 Results of Operations and Financial Condition.

On July 29, 2020, Pluralsight, Inc. issued a press release announcing its financial results for the quarter ended June 30, 2020. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

The information contained in Item 2.02 and Item 9.01 in this Form 8-K, including the accompanying Exhibit 99.1 hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filings, unless expressly incorporated by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.
 
 
Exhibit No.
Description of Exhibit
99.1
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)



1


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
Pluralsight, Inc.
 
 
 
 
Date:
July 29, 2020
/s/
James Budge
 
 
 
James Budge
 
 
 
Chief Financial Officer


2
Exhibit
Exhibit 99.1

Pluralsight Announces Second Quarter 2020 Results

Silicon Slopes, Utah - July 29, 2020 - Pluralsight, Inc. (NASDAQ: PS), the enterprise technology skills and engineering management platform, today announced financial results for the second quarter ended June 30, 2020.
"Our commitment to our customers and each other has never been stronger despite these extraordinary circumstances. I’m proud to see this commitment reflected in our financial performance for the quarter, and I’m confident that our platform will continue to help companies and individuals adapt to the changing remote work environments around the globe," said Aaron Skonnard, co-founder and CEO of Pluralsight. “This need, coupled with our commitment to our customers and our world-class, highly differentiated product offerings allowed us to excel in the current environment."
Second Quarter Financial Highlights
Billings - Q2 2020 billings were $89.0 million, an increase of 11% period over period. Q2 2020 billings from business customers were $77.7 million, an increase of 12% period over period.
Revenue - Q2 2020 revenue was $94.8 million, an increase of 25% period over period.
Gross margin - Q2 2020 gross margin was 79%, compared to 77% in Q2 2019. Q2 2020 non-GAAP gross margin was 81%, compared to 78% in Q2 2019.
Net loss per share - GAAP net loss per share for Q2 2020 was $0.28, compared to $0.30 in Q2 2019. Adjusted pro forma net loss per share for Q2 2020 was $0.02, compared to $0.06 in Q2 2019.
Cash flows - Cash used in operations was $9.3 million for Q2 2020, compared to $7.2 million in Q2 2019. Free cash flow was negative $18.0 million for Q2 2020, compared to negative $11.1 million in Q2 2019.
For information regarding the non-GAAP financial measures discussed in this press release, please see the section titled “Non-GAAP Financial Measures.” Reconciliations between GAAP and non-GAAP financial measures are provided in the tables of this press release.
Financial Outlook
The following forward-looking statements reflect Pluralsight's expectations as of July 29, 2020.
Third Quarter 2020 Guidance
Revenue is expected to be in the range of $95.0 million to $96.0 million.
Adjusted pro forma net loss per share is expected to be in the range of $0.05 to $0.06, assuming weighted-average shares outstanding of approximately 144 million.



Full Year 2020 Guidance
Revenue is expected to be in the range of $375.0 million to $390.0 million.
Adjusted pro forma net loss per share is expected to be in the range of $0.19 to $0.27, assuming weighted-average shares outstanding of approximately 143.5 million.
Guidance for non-GAAP financial measures excludes equity-based compensation, amortization of acquired intangible assets, employer payroll taxes on employee stock transactions, amortization of debt discount and issuance costs, and, as applicable, other special items, which may be significant. Pluralsight has not reconciled its expectations as to adjusted pro forma net loss per share to their most directly comparable GAAP measures because certain items cannot be reasonably predicted. Accordingly, a reconciliation for expectations of adjusted pro forma net loss per share is not available without unreasonable effort.
Pluralsight’s guidance for the third quarter and full year 2020 reflects its expectations for the periods after taking into account the impact of COVID-19. However, the crisis that this pandemic has created is very fluid, and the situation is constantly evolving. As such, Pluralsight’s actual results may differ materially from such guidance based on a variety of factors, including Pluralsight’s ability to execute its business during this crisis, the impact of the crisis on Pluralsight’s suppliers, customers and partners, governmental action taken in response to COVID-19, and other factors.
Conference Call Information
Pluralsight will host a conference call for analysts and investors to discuss its second quarter 2020 results and outlook for its third quarter and full year 2020, today at 2:30 p.m. Mountain Time (4:30 p.m. Eastern Time).
Date:
July 29, 2020
Time:
2:30 p.m. MT (4:30 p.m. ET)
Webcast:
https://investors.pluralsight.com/
Dial-in number:
(877) 350-6732 or (629) 228-0693, conference ID: 1883129
A live audio webcast of the conference call will also be accessible from the Pluralsight website at investors.pluralsight.com. A telephonic replay of the call will be available three hours after the call, will run for seven days, and may be accessed by dialing (855) 859-2056 or (404) 537-3406 and entering the passcode 1883129.
About Pluralsight
Pluralsight is the leading technology skills and engineering management platform. Trusted by forward-thinking companies of every size in every industry, Pluralsight helps individuals and businesses transform with technology through its Skills and Flow products. Skills helps build technology skills at scale with expert-authored courses on today’s most important technologies, including cloud, artificial intelligence, machine learning, data science, and security, among others. Skills also offers analytics and Skill IQ and Role IQ assessments. Flow complements Skills by providing visibility and analytics into software development workflows to accelerate the delivery of products and services.




Pluralsight and the Pluralsight logo are trademarks of Pluralsight, LLC in the United States and in jurisdictions throughout the world.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws that involve risks and uncertainties, including the quotations of management and statements regarding our future financial and operating performance, and our financial outlook for the third quarter and full year 2020. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including: our ability to attract and retain customers; our ability to expand our course library and develop new platform features; the demand for, and market acceptance of our platform; competition; our ability to improve sales management and execution; our expectations of the potential impact the COVID-19 pandemic may have on our business; and other market, political, economic, and business conditions.
Additional risks and uncertainties that could affect our financial results are included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K/A filed with the SEC on March 2, 2020 and in our quarterly report on Form 10-Q filed with the SEC on July 29, 2020, which is available on our website at investors.pluralsight.com and on the SEC’s website at www.sec.gov. Additional information will also be set forth in other filings that we make with the SEC from time to time. All forward-looking statements in this press release are based on information available to us as of the date hereof, and we do not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
Key Business Metrics
Billings. Billings represents total revenue plus the change in deferred revenue in the period, as presented in our condensed consolidated statements of cash flows, less the change in contract assets and unbilled accounts receivable in the period. Billings in any particular period represents amounts invoiced to customers and reflects subscription renewals and upsells to existing customers plus sales to new customers. We use billings to measure our ability to sell subscriptions to our platform to both new and existing customers. We use billings from business customers and our percentage of billings from business customers to measure and monitor our ability to sell subscriptions to our platform to business customers.
Non-GAAP Financial Measures
Pluralsight has provided in this press release financial information that has not been prepared in accordance with generally accepted accounting principles in the United States (GAAP). Pluralsight uses the non-GAAP financial measures of non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating loss, adjusted pro forma net loss, adjusted pro forma net loss per share, and free cash flow in analyzing its financial results and believes that the use of these metrics is useful to investors as an additional tool to evaluate ongoing operating results and trends and in comparing Pluralsight’s financial results with other companies in its industry, many of which present similar non-GAAP financial measures.



The presentation of these non-GAAP financial measures is not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. A reconciliation of our historical non-GAAP financial measures to their most directly comparable GAAP measures have been provided in the financial statement tables included in this press release, and investors are encouraged to review these reconciliations.
Non-GAAP gross profit. We define non-GAAP gross profit as gross profit plus equity-based compensation, amortization of acquired intangible assets, and employer payroll taxes on employee stock transactions.
Non-GAAP gross margin. We define non-GAAP gross margin as non-GAAP gross profit divided by our revenue.
Non-GAAP operating expenses. We define non-GAAP operating expenses as operating expenses less equity-based compensation, amortization of acquired intangible assets, and employer payroll taxes on employee stock transactions, and, as applicable, other special items.
Non-GAAP operating loss. We define non-GAAP operating loss as loss from operations plus equity-based compensation, amortization of acquired intangible assets, employer payroll taxes on employee stock transactions, and, as applicable, other special items.
Adjusted pro forma net loss and adjusted pro forma net loss per share. We define adjusted pro forma net loss as net loss attributable to Pluralsight, Inc. adjusted for the reallocation of loss attributable to non-controlling interests from the assumed exchange of LLC Units of Pluralsight Holdings for newly-issued shares of Class A common stock of Pluralsight, Inc. and further adjusted for equity-based compensation, amortization of acquired intangible assets, employer payroll taxes on employee stock transactions, amortization of debt discount and issuance costs, and, as applicable, other special items. We define adjusted pro forma net loss per share as adjusted pro forma net loss divided by the weighted-average shares of Class A common stock outstanding, assuming the full exchange of all outstanding LLC Units of Pluralsight Holdings for newly-issued shares of Class A common stock of Pluralsight, Inc.
Free cash flow. We define free cash flow as cash provided by (used in) operating activities less purchases of property and equipment and purchases of our content library.



PLURALSIGHT, INC.
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
(unaudited)
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Revenue
 
$
94,765

 
$
75,862

 
$
187,411

 
$
145,479

Cost of revenue(1)(2)
 
19,717

 
17,803

 
38,725

 
34,515

Gross profit
 
75,048

 
58,059

 
148,686

 
110,964

Operating expenses(1)(2):
 
 
 
 
 
 
 
 
Sales and marketing
 
57,759

 
50,046

 
120,174

 
94,217

Technology and content
 
29,514

 
24,819

 
59,658

 
45,090

General and administrative
 
22,996

 
20,575

 
46,367

 
42,766

Total operating expenses
 
110,269

 
95,440

 
226,199

 
182,073

Loss from operations
 
(35,221
)
 
(37,381
)
 
(77,513
)
 
(71,109
)
Other income (expense):
 
 
 
 
 
 
 
 
Interest expense
 
(7,241
)
 
(7,346
)
 
(14,390
)
 
(9,024
)
Other income, net
 
2,267

 
4,106

 
4,437

 
5,782

Loss before income taxes
 
(40,195
)
 
(40,621
)
 
(87,466
)
 
(74,351
)
Income tax benefit (expense)
 
465

 
(143
)
 
223

 
(297
)
Net loss
 
$
(39,730
)
 
$
(40,764
)
 
$
(87,243
)
 
$
(74,648
)
Less: Net loss attributable to non-controlling interests
 
(9,801
)
 
(11,637
)
 
(21,995
)
 
(26,446
)
Net loss attributable to Pluralsight, Inc.
 
$
(29,929
)
 
$
(29,127
)
 
$
(65,248
)
 
$
(48,202
)
Net loss per share, basic and diluted(3)
 
$
(0.28
)
 
$
(0.30
)
 
$
(0.62
)
 
$
(0.56
)
Weighted-average shares of Class A common stock used in computing basic and diluted net loss per share
 
107,153

 
97,608

 
105,899

 
86,827

(1) Includes equity-based compensation as follows:
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Cost of revenue
 
$
296

 
$
133

 
$
566

 
$
217

Sales and marketing
 
10,878

 
7,952

 
20,400

 
14,228

Technology and content
 
6,884

 
5,137

 
13,220

 
8,847

General and administrative
 
8,367

 
9,510

 
17,817

 
19,708

Total equity-based compensation
 
$
26,425

 
$
22,732

 
$
52,003

 
$
43,000

(2) Includes amortization of acquired intangible assets as follows:
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Cost of revenue
 
$
1,209

 
$
702

 
$
2,418

 
$
1,227

Sales and marketing
 
50

 
29

 
100

 
29

Technology and content
 
161

 
176

 
337

 
353

Total amortization of acquired intangible assets
 
$
1,420

 
$
907

 
$
2,855

 
$
1,609




PLURALSIGHT, INC.
Key Business Metrics and Non-GAAP Financial Measures
(dollars in thousands)
(unaudited)

Key Business Metrics
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Billings
 
$
89,034

 
$
80,552

 
$
179,312

 
$
158,480

Billings from business customers
 
$
77,695

 
$
69,104

 
$
158,167

 
$
136,260

% of billings from business customers
 
87
%
 
86
%
 
88
%
 
86
%

Non-GAAP Financial Measures
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Reconciliation of gross profit to non-GAAP gross profit:
 
 
 
 
 
 
 
 
Gross profit
 
$
75,048

 
$
58,059

 
$
148,686

 
$
110,964

Equity-based compensation
 
296

 
133

 
566

 
217

Amortization of acquired intangible assets
 
1,209

 
702

 
2,418

 
1,227

Employer payroll taxes on employee stock transactions
 
15

 
13

 
32

 
16

Non-GAAP gross profit
 
$
76,568

 
$
58,907

 
$
151,702

 
$
112,424

Gross margin
 
79
%
 
77
%
 
79
%
 
76
%
Non-GAAP gross margin
 
81
%
 
78
%
 
81
%
 
77
%




PLURALSIGHT, INC.
Key Business Metrics and Non-GAAP Financial Measures (cont.)
(dollars in thousands)
(unaudited)

 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Reconciliation of operating expenses to non-GAAP operating expenses:
 
 
 
 
 
 
 
 
Sales and marketing
 
$
57,759

 
$
50,046

 
$
120,174

 
$
94,217

Less: Equity-based compensation
 
(10,878
)
 
(7,952
)
 
(20,400
)
 
(14,228
)
Less: Amortization of acquired intangible assets
 
(50
)
 
(29
)
 
(100
)
 
(29
)
Less: Employer payroll taxes on employee stock transactions
 
(329
)
 
(533
)
 
(821
)
 
(1,141
)
Non-GAAP sales and marketing
 
$
46,502

 
$
41,532

 
$
98,853

 
$
78,819

Sales and marketing as a percentage of revenue
 
61
%
 
66
%
 
64
%
 
65
%
Non-GAAP sales and marketing as a percentage of revenue
 
49
%
 
55
%
 
53
%
 
54
%
 
 
 
 
 
 
 
 
 
Technology and content
 
$
29,514

 
$
24,819

 
$
59,658

 
$
45,090

Less: Equity-based compensation
 
(6,884
)
 
(5,137
)
 
(13,220
)
 
(8,847
)
Less: Amortization of acquired intangible assets
 
(161
)
 
(176
)
 
(337
)
 
(353
)
Less: Employer payroll taxes on employee stock transactions
 
(381
)
 
(434
)
 
(852
)
 
(914
)
Non-GAAP technology and content
 
$
22,088

 
$
19,072

 
$
45,249

 
$
34,976

Technology and content as a percentage of revenue
 
31
%
 
33
%
 
32
%
 
31
%
Non-GAAP technology and content as a percentage of revenue
 
23
%
 
25
%
 
24
%
 
24
%
 
 
 
 
 
 
 
 
 
General and administrative
 
$
22,996

 
$
20,575

 
$
46,367

 
$
42,766

Less: Equity-based compensation
 
(8,367
)
 
(9,510
)
 
(17,817
)
 
(19,708
)
Less: Employer payroll taxes on employee stock transactions
 
(272
)
 
(349
)
 
(670
)
 
(702
)
Less: Secondary offering costs
 
(1,260
)
 

 
(1,260
)
 
(918
)
Less: Acquisition-related costs
 

 
(835
)
 

 
(835
)
Non-GAAP general and administrative
 
$
13,097

 
$
9,881

 
$
26,620

 
$
20,603

General and administrative as a percentage of revenue
 
24
%
 
27
%
 
25
%
 
29
%
Non-GAAP general and administrative as a percentage of revenue
 
14
%
 
13
%
 
14
%
 
14
%
Reconciliation of loss from operations to non-GAAP operating loss:
 
 
 
 
 
 
 
 
Loss from operations
 
$
(35,221
)
 
$
(37,381
)
 
$
(77,513
)
 
$
(71,109
)
Equity-based compensation
 
26,425

 
22,732

 
52,003

 
43,000

Amortization of acquired intangible assets
 
1,420

 
907

 
2,855

 
1,609

Employer payroll taxes on employee stock transactions
 
997

 
1,329

 
2,375

 
2,773

Secondary offering costs
 
1,260

 

 
1,260

 
918

Acquisition-related costs
 

 
835

 

 
835

Non-GAAP operating loss
 
$
(5,119
)
 
$
(11,578
)
 
$
(19,020
)
 
$
(21,974
)



PLURALSIGHT, INC.
Key Business Metrics and Non-GAAP Financial Measures (cont.)
(in thousands, except per share amounts)
(unaudited)

 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Adjusted pro forma net loss per share
 
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
 
Net loss attributable to Pluralsight, Inc.
 
$
(29,929
)
 
$
(29,127
)
 
$
(65,248
)
 
$
(48,202
)
Net loss attributable to non-controlling interests
 
(9,801
)
 
(11,637
)
 
(21,995
)
 
(26,446
)
Equity-based compensation
 
26,425

 
22,732

 
52,003

 
43,000

Amortization of acquired intangibles
 
1,420

 
907

 
2,855

 
1,609

Employer payroll taxes on employee stock transactions
 
997

 
1,329

 
2,375

 
2,773

Secondary offering costs
 
1,260

 

 
1,260

 
918

Acquisition-related costs
 

 
835

 

 
835

Amortization of debt discount and issuance costs
 
6,684

 
6,749

 
13,275

 
8,294

Adjusted pro forma net loss
 
$
(2,944
)
 
$
(8,212
)
 
$
(15,475
)
 
$
(17,219
)
Denominator:
 
 
 
 
 
 
 
 
Weighted-average shares of Class A common stock outstanding
 
107,153

 
97,608

 
105,899

 
86,827

Weighted-average LLC Units of Pluralsight Holdings that are convertible into Class A common stock
 
35,276

 
39,006

 
35,702

 
48,923

Adjusted pro forma weighted-average common shares outstanding, basic and diluted
 
142,429

 
136,614

 
141,601

 
135,750

Adjusted pro forma net loss per share
 
$
(0.02
)
 
$
(0.06
)
 
$
(0.11
)
 
$
(0.13
)
Reconciliation of net cash (used in) provided by operating activities to free cash flow:
 
 
 
 
 
 
 
 
Net cash (used in) provided by operating activities
 
$
(9,250
)
 
$
(7,184
)
 
$
9,045

 
$
(1,648
)
Less: Purchases of property and equipment
 
(6,626
)
 
(2,457
)
 
(20,520
)
 
(4,590
)
Less: Purchases of content library
 
(2,113
)
 
(1,504
)
 
(3,793
)
 
(2,441
)
Free cash flow
 
$
(17,989
)
 
$
(11,145
)
 
$
(15,268
)
 
$
(8,679
)






PLURALSIGHT, INC.
Condensed Consolidated Balance Sheets
(in thousands)
(unaudited)

 
 
June 30,
2020
 
December 31,
2019
 
 
 
 
 
Assets
 
 
 
 
Current assets:
 
 
 
 
Cash and cash equivalents
 
$
87,982

 
$
90,515

Short-term investments
 
318,483

 
332,234

Accounts receivable, net
 
61,578

 
101,576

Deferred contract acquisition costs
 
17,745

 
18,331

Prepaid expenses and other current assets
 
14,764

 
14,174

Total current assets
 
500,552

 
556,830

Restricted cash and cash equivalents
 
21,622

 
28,916

Long-term investments
 
122,224

 
105,805

Property and equipment, net
 
60,788

 
22,896

Right-of-use assets
 
62,982

 
15,804

Content library, net
 
11,017

 
8,958

Intangible assets, net
 
19,787

 
22,631

Goodwill
 
262,532

 
262,532

Deferred contract acquisition costs, noncurrent
 
7,164

 
5,982

Other assets
 
1,709

 
1,599

Total assets
 
$
1,070,377

 
$
1,031,953

Liabilities and stockholders' equity
 
 
 
 
Current liabilities:
 
 
 
 
Accounts payable
 
$
5,985

 
$
10,615

Accrued expenses
 
38,950

 
40,703

Accrued author fees
 
11,711

 
11,694

Lease liabilities
 
7,752

 
5,752

Deferred revenue
 
207,575

 
215,137

Total current liabilities
 
271,973

 
283,901

Deferred revenue, noncurrent
 
18,813

 
19,517

Convertible senior notes, net
 
483,503

 
470,228

Lease liabilities, noncurrent
 
76,340

 
11,167

Other liabilities
 
70

 
980

Total liabilities
 
850,699

 
785,793

Stockholders' equity:
 
 
 
 
Preferred stock
 

 

Class A common stock
 
11

 
10

Class B common stock
 
2

 
2

Class C common stock
 
1

 
1

Additional paid-in capital
 
693,768

 
641,128

Accumulated other comprehensive income
 
1,154

 
225

Accumulated deficit
 
(523,629
)
 
(458,381
)
Total stockholders’ equity attributable to Pluralsight, Inc.
 
171,307

 
182,985

Non-controlling interests
 
48,371

 
63,175

Total stockholders’ equity
 
219,678

 
246,160

Total liabilities and stockholders' equity
 
$
1,070,377

 
$
1,031,953





PLURALSIGHT, INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
 
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
 
2020
 
2019
 
2020
 
2019
 
 
 
 
 
 
 
 
 
Operating activities
 
 
 
 
 
 
 
 
Net loss
 
$
(39,730
)
 
$
(40,764
)
 
$
(87,243
)
 
$
(74,648
)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
 
 
 
 
 
 
 
 
Depreciation of property and equipment
 
3,225

 
2,332

 
5,868

 
4,579

Amortization of acquired intangible assets
 
1,420

 
907

 
2,855

 
1,609

Amortization of course creation costs
 
820

 
611

 
1,581

 
1,190

Equity-based compensation
 
26,425

 
22,732

 
52,003

 
43,000

Amortization of deferred contract acquisition costs
 
6,316

 
5,444

 
12,767

 
11,311

Amortization of debt discount and issuance costs
 
6,684

 
6,749

 
13,275

 
8,294

Investment discount and premium amortization, net
 
(52
)
 
(706
)
 
(428
)
 
(706
)
Other
 
32

 
275

 
693

 
300

Changes in assets and liabilities, net of acquired assets and liabilities:
 
 
 
 
 
 
 
 
Accounts receivable
 
(1,107
)
 
(4,276
)
 
38,093

 
7,116

Deferred contract acquisition costs
 
(7,492
)
 
(5,579
)
 
(13,363
)
 
(11,430
)
Prepaid expenses and other assets
 
(497
)
 
(2,243
)
 
(211
)
 
(4,044
)
Right-of-use assets
 
1,548

 
1,643

 
3,038

 
2,927

Accounts payable
 
(2,139
)
 
18

 
(4,606
)
 
1,053

Accrued expenses and other liabilities
 
1,719

 
2,030

 
(4,612
)
 
(3,129
)
Accrued author fees
 
114

 
564

 
16

 
1,299

Lease liabilities
 
(949
)
 
(1,636
)
 
(2,874
)
 
(3,372
)
Deferred revenue
 
(5,587
)
 
4,715

 
(7,807
)
 
13,003

Net cash (used in) provided by operating activities
 
(9,250
)
 
(7,184
)
 
9,045

 
(1,648
)
Investing activities
 
 
 
 
 
 
 
 
Purchases of property and equipment
 
(6,626
)
 
(2,457
)
 
(20,520
)
 
(4,590
)
Purchases of content library
 
(2,113
)
 
(1,504
)
 
(3,793
)
 
(2,441
)
Cash paid for acquisition, net of cash acquired
 

 
(163,871
)
 

 
(163,871
)
Purchases of investments
 
(155,150
)
 
(317,080
)
 
(317,012
)
 
(317,080
)
Proceeds from sales of investments
 

 
4,967

 

 
4,967

Proceeds from maturities of investments
 
155,070

 

 
315,605

 

Net cash used in investing activities
 
(8,819
)
 
(479,945
)
 
(25,720
)
 
(483,015
)
Financing activities
 
 
 
 
 
 
 
 
Proceeds from issuance of common stock from employee equity plans
 
10,179

 
12,010

 
10,878

 
14,631

Taxes paid related to net share settlement
 
(1,523
)
 

 
(3,873
)
 

Proceeds from issuance of convertible senior notes, net of discount and issuance costs
 

 
(1,009
)
 

 
616,654

Purchase of capped calls related to issuance of convertible senior notes
 

 

 

 
(69,432
)
Net cash provided by financing activities
 
8,656

 
11,001

 
7,005

 
561,853

Effect of exchange rate changes on cash, cash equivalents, and restricted cash and cash equivalents
 
110

 
(4
)
 
(157
)
 
22

Net (decrease) increase in cash, cash equivalents, and restricted cash and cash equivalents
 
(9,303
)
 
(476,132
)
 
(9,827
)
 
77,212

Cash, cash equivalents, and restricted cash and cash equivalents, beginning of period
 
118,907

 
764,415

 
119,431

 
211,071

Cash, cash equivalents, and restricted cash and cash equivalents, end of period
 
$
109,604

 
$
288,283

 
$
109,604

 
$
288,283




Investor Relations Contact:
Mark McReynolds
Investor Relations
Pluralsight
801-784-9007
ir@pluralsight.com

Media Contact:
DJ Anderson
Communications/Press
Pluralsight
801-784-9007
dj@pluralsight.com