Stock-Based Compensation |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Share-Based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-Based Compensation | Stock-Based Compensation Stock-Based Award Plans As of March 31, 2026, 11,976,909 shares were available for future issuance under the 2025 Incentive Award Plan. Stock-Based Compensation Expense Total stock-based compensation costs recognized in the condensed consolidated statements of operations were as follows (in thousands):
In addition, $0.2 million of stock-based compensation costs were capitalized as internal use software during the three months ended March 31, 2026. Stock Options Granted For the three months ended March 31, 2026, the Company has granted options to employees to purchase an aggregate 2,087,000 shares of the Company’s common stock. The options have a weighted average exercise price of $10.05 per share, and generally vest over four years subject to continued service requirements. The fair values of stock option awards are estimated on the grant date using the Black-Scholes option pricing model, which requires the Company to make certain assumptions including the fair value of the underlying common stock, expected term, expected volatility, risk-free interest rate, dividend yield, and derived service period, summarized as follows: •Fair Value of the Underlying Common Stock – The fair value of common stock is based on the closing price of the Company's Class A common stock on grant date. •Risk-Free Interest Rate – The risk-free interest rate used is based on the implied yield in effect at the time of grant of U.S. Treasury securities with maturities similar to the expected term of the options. •Expected Term – The Company calculates the expected term of its employee options based upon the simplified method, which estimates the expected term as the average of the contractual life of the option and its vesting period. •Volatility – The expected volatility is based on the historical volatility of comparable companies from a representative peer group selected based on industry, financial, and market-capitalization data as the Company does not have sufficient trading history for its Class A common stock. •Dividend Yield – The dividend yield is zero as the Company has not declared or paid any dividends to date and does not currently expect to do so in the future. The range of assumptions that were used to calculate the grant date fair value of the Company’s stock option grants for the three months ended March 31, 2026 were as follows:
Partial Recourse Promissory Notes On August 25, 2021, three employees early exercised 2,032,429 outstanding stock options resulting in the issuance of shares of common stock. However, the exercises were paid via issuance of partial recourse promissory notes, and as a result, the Company concluded that the early exercises of the stock options will continue to be accounted for as outstanding stock option grants until the time that the notes are repaid or extinguished. On February 28, 2025, the Company forgave the outstanding principal and accrued interest associated with the partial recourse promissory notes for two employees related to 1,894,054 options. Shares that are related to outstanding partial recourse promissory notes are not reflected as outstanding shares on the condensed consolidated balance sheets and are excluded from the denominator of basic earnings per share. As of March 31, 2026, there are 138,375 early exercised stock options still subject to a partial recourse promissory note. On August 25, 2021, the Company executed restricted stock purchase agreements with three individuals. However, the purchase agreements were executed in conjunction with the issuance of partial recourse promissory notes for the amounts owed. Accordingly, the shares are considered legally issued and outstanding but are not reflected as outstanding shares on the condensed consolidated balance sheets and are excluded from the denominator of basic earnings per share until such time that the promissory notes have been paid. As of March 31, 2026, there are 2,380,979 shares of restricted stock subject to these partial recourse promissory notes. Employee Stock Purchase Plan The 2025 Employee Stock Purchase Plan (“ESPP”) allows employees to purchase shares by authorizing contributions at a minimum of 1% up to a maximum of 15% of his or her base salary for each pay period, which will then be used to purchase shares on the last business day of the offering period at a price equal to 85% of the fair market value of common stock on the grant date or the purchase date whichever is less. The offering periods of six months end on February 15th and August 15th of each year. As of March 31, 2026, 1,849,866 shares were available for future issuance under the ESPP. The first offering period to the Company's employees to purchase shares under the ESPP began on February 16, 2026. As of March 31, 2026, the Company has withheld $0.4 million of contributions from its employees within accrued payroll and related liabilities on the condensed consolidated balance sheets related to the purchase period that ends August 15, 2026.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||