Earnout Shares |
3 Months Ended |
|---|---|
Mar. 31, 2026 | |
| Earnout Shares | |
| Earnout Shares | Earnout Shares Certain stockholders and employees hold “earnout shares” that convert to the Company’s Class A common stock, to be issued in tranches, when the Company’s Class A common stock’s price achieves certain market share price milestones within specified periods. As of March 31, 2026, the total number of earnout shares issued and outstanding were approximately 23 million. The earnout shares held by stockholders are accounted under Accounting Standard Codification 815, “Derivatives and Hedging” (“ASC 815”) and remeasured at fair value at each reporting date. The change in fair value of the earnout shares is recognized in the Company’s consolidated statements of operations. The fair value of the earnout shares is estimated using the Monte Carlo simulation of the stock prices based on historical market volatility (see note 15 – Fair Value Measurements). As of March 31, 2026 the fair value of the earnout shares derivative liability was estimated to be $6 million. The Company recognized a gain on the fair value change in earnout shares derivative liability of $31 million and $74 million in its consolidated statement of operations for the three months ended March 31, 2026, and March 31, 2025 respectively.
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