Equity-Based Compensation

3 Months Ended

Mar. 31, 2025

Share-Based Payment Arrangement [Abstract]

Management Incentive Plan

The table below presents the activity of the Company's stock options for the three months ended March 31, 2025:


	Number of stock options	Weighted average exercise price per stock option		Weighted average remaining contractual term (in years)	Aggregate intrinsic value (in $ millions)
Balance as of December 31, 2024	13,338,391	$	7.52
Exercised	(3,348,336)	$	5.86
Expired	(60,777)	$	10.03

Balance as of March 31, 2025	9,929,278	$	8.06
Exercisable as of March 31, 2025	9,929,278	$	8.06	3.5	$	4

Total shares withheld to cover the stock option costs and taxes were 2,709,601 shares and were based on the value of the shares on their respective exercise dates. Total payment for the employees’ tax obligations to taxing authorities was $2 million of which $1 million was paid during the three months ended March 31, 2025 and is reflected as a financing activity within the consolidated statements of cash flows.

2022 Equity Incentive Plan

Restricted Stock Units ("RSUs")

During the three months ended March 31, 2025, as part of its annual grant program, the Company granted 6 million RSUs under the 2022 Equity Incentive Plan to certain of its key employees. The RSUs generally vest one-third annually on the first three anniversaries of the grant date. The vesting is conditional upon continued employment of the grantee through the applicable vesting period and subject to such other terms and conditions as set forth in the applicable restricted stock

unit award agreement. The RSUs do not accrue dividends or dividend equivalent rights associated with the underlying stock. The fair value of the RSUs is determined to be the market price of the Company’s Class A common stock at the date of grant.

The table below presents the activity of the Company’s RSUs for the three months ended March 31, 2025:


	Number of RSUs	Weighted average grant date fair value
Balance as of December 31, 2024	25,410,910	$	6.17
Granted	6,228,922	$	8.52
Forfeited	(280,498)	$	5.92
Vested	(11,387,027)	$	6.39
Balance as of March 31, 2025	19,972,307	$	6.78

During the three months ended March 31, 2025, the vested RSUs were net-share settled such that the Company withheld shares with value equivalent to no more than the employee’s maximum statutory obligation for applicable income and other employment taxes, and remitted the cash to the appropriate taxing authorities. A total of 4,584,930 shares were withheld based on the value of the RSUs on their respective vesting dates as determined by the Company’s closing stock price. Total employees’ tax obligations to taxing authorities was $39 million of which $23 million was paid during the three months ended March 31, 2025 and is reflected as a financing activity within the consolidated statements of cash flows.

Performance Stock Units (PSUs")

During the three months ended March 31, 2025, as part of its annual grant program, the Company granted 774,644 PSUs under the 2022 Equity Incentive Plan to certain of its key employees. The PSUs cliff-vest at the end of three years from the grant date based on the outcome of certain performance criteria that are established and approved by the Compensation Committee of the Board of Directors. The actual number of equity awards earned is based on the average level of performance goals achieved over a three-year period, relative to established performance goals for each of the respective years within the three-year period. The number of PSUs that will vest based on achievement of performance goals range from 0% to 150% of the original grant. No PSUs vest if the actual performance is less than 50% of performance goals set. The number of PSUs earned upon achievement of performance goals will further be adjusted and the ultimate number of PSUs that will be earned by the grantee will be based on the percentile ranking of the Company’s total shareholder return ("TSR") over the three-year performance period as compared to the TSR of the members of the S&P 500 Index over the same period ("TSR Goal"). However, the total number of PSUs that will ultimately be earned by the grantee will not exceed 187.5% of the original grant, and if the Company's TSR is negative, the ultimate number of PSUs earned by the grantee cannot exceed the original grant. All the PSUs will be settled in the Company's Class A common stock. The PSUs do not accrue dividends or dividend equivalent rights associated with the underlying stock.

The TSR Goal is considered a “market condition” under ASC 718, Compensation-Stock Compensation. The Company uses a Monte Carlo simulation model to determine the grant date fair value of PSUs with a market condition utilizing following assumptions: the expected volatility of 47.4%, the expected term of 2.8 years, the dividend rate of 0% and the risk-free interest rate of 3.94%, which resulted in a calculated fair value of $11.14 per PSU. The Monte Carlo simulation takes into consideration the probability that the market condition will be achieved based on predicted stock price paths compared to peer companies in the S&P 500 Index. The Company recognizes the equity compensation expense related to PSUs based on the grant-date fair value and number of PSUs expected to vest. Each reporting period, the Company assesses the probability of vesting of the PSUs and, if there is any change in such probability, the Company records the cumulative effect of the adjustment in the current reporting period.

Employee Stock Purchase Plan (“ESPP”)

During the three months ended March 31, 2025, 535,229 shares were issued under the ESPP.

Total equity-based compensation expense recognized in the Company’s consolidated statements of operations for the three months ended March 31, 2025 and 2024 amount to $19 million and $18 million, respectively ($15 million and $14 million, net of taxes, respectively) and were included as follows:


(in $ millions)	Three months ended March 31,
		2025		2024
Cost of revenue (excluding depreciation and amortization)		$	1	$	1
Sales and marketing		5		4
Technology and content		5		4
General and administrative		8		9
Total		$	19	$	18

As of March 31, 2025, the Company expects compensation expense related to unvested RSUs and PSUs of approximately $128 million to be recognized over the remaining weighted average period of 2 years.