Notes to Consolidated Financial Statements
(in thousands, except share and per share data)
(unaudited)
Note 1: Basis of Presentation
The accompanying unaudited consolidated financial statements include the accounts of Bentley Systems, Incorporated and its wholly-owned subsidiaries (“Bentley Systems, Incorporated” or the “Company”), and have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all the information and notes required by U.S. GAAP for annual financial statements. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s 2022 Annual Report on Form 10‑K. In management’s opinion, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal, recurring and non-recurring adjustments) that were considered necessary for the fair statement of the Company’s financial position, results of operations, and cash flows as of the dates and for the periods indicated. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts in the financial statements and accompanying notes. Actual results could differ materially from those estimates. The December 31, 2022 consolidated balance sheet included herein is derived from the Company’s audited consolidated financial statements.
Certain reclassifications of prior period amounts have been made to conform to the current period presentation. For the three months ended March 31, 2023, payments related to the Company’s interest rate swap were recognized in Other income (expense), net in the consolidated statements of operations and the corresponding prior period amounts, which were previously recognized in Interest expense, net, were reclassified to conform to the current period presentation. For the three months ended March 31, 2022, the amounts reclassified were not material, and Income before income taxes and Net income in the consolidated statements of operations did not change as a result of these reclassifications.
Note 2: Recent Accounting Pronouncements
In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2020‑04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020‑04”), which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. ASU 2020‑04 applies only to contracts, hedging relationships, and other transactions that reference the London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform between March 12, 2020 and December 31, 2022. In December 2022, the FASB issued ASU No. 2022‑06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, which provides optional guidance to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting by extending the sunset date of Topic 848 to December 31, 2024. The expedients and exceptions provided by these ASUs do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2024, except for hedging relationships existing as of December 31, 2024, that an entity has elected certain optional expedients for and that are retained through the end of the hedging relationship. The Company had no transactions that were impacted by these ASUs during the three months ended March 31, 2023.
Note 3: Revenue from Contracts with Customers
Disaggregation of Revenues
The Company’s revenues consist of the following:
| | | | | | | | | | | |
| Three Months Ended |
| March 31, |
| 2023 | | 2022 |
Subscriptions: | | | |
Enterprise subscriptions (1) | $ | 103,904 | | | $ | 81,827 | |
SELECT subscriptions | 63,343 | | | 66,598 | |
Term license subscriptions | 110,598 | | | 92,808 | |
Subscriptions | 277,845 | | | 241,233 | |
Perpetual licenses | 9,547 | | | 10,205 | |
Subscriptions and licenses | 287,392 | | | 251,438 | |
Services: | | | |
Recurring | 4,178 | | | 4,701 | |
Other | 22,841 | | | 19,378 | |
Services | 27,019 | | | 24,079 | |
Total revenues | $ | 314,411 | | | $ | 275,517 | |
(1)Enterprise subscriptions includes revenue attributable to Enterprise 365 (“E365”) subscriptions of $94,331 and $68,598 for the three months ended March 31, 2023 and 2022, respectively.
The Company recognizes perpetual licenses and the term license component of subscriptions as revenue when either the licenses are delivered or at the start of the subscription term. For the three months ended March 31, 2023 and 2022, the Company recognized $158,024 and $125,225 of license related revenues, respectively, of which $148,477 and $115,020, respectively, were attributable to the term license component of the Company’s subscription based commercial offerings recorded in Subscriptions in the consolidated statements of operations.
The Company derived 7% of its total revenues through channel partners for the three months ended March 31, 2023 and 2022.
Revenue from external customers is attributed to individual countries based upon the location of the customer. Revenues by geographic region are as follows:
| | | | | | | | | | | |
| Three Months Ended |
| March 31, |
| 2023 | | 2022 |
Americas (1) | $ | 168,345 | | | $ | 154,260 | |
Europe, the Middle East, and Africa (“EMEA”) | 92,832 | | | 77,480 | |
Asia-Pacific (“APAC”) | 53,234 | | | 43,777 | |
Total revenues | $ | 314,411 | | | $ | 275,517 | |
(1)Americas includes the United States (“U.S.”), Canada, and Latin America (including the Caribbean). Revenue attributable to the U.S. totaled $127,450 and $116,133 for the three months ended March 31, 2023 and 2022, respectively.
Contract Assets and Contract Liabilities
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Contract assets | $ | 535 | | | $ | 575 | |
Deferred revenues | 250,747 | | | 243,073 | |
As of March 31, 2023 and December 31, 2022, the Company’s contract assets relate to performance obligations completed in advance of the right to invoice and are included in Prepaid and other current assets in the consolidated balance sheets. Contract assets were not impaired as of March 31, 2023 and December 31, 2022.
Deferred revenues consist of billings made or payments received in advance of revenue recognition from subscriptions and services. The timing of revenue recognition may differ from the timing of billings to users.
For the three months ended March 31, 2023, $95,979 of revenues that were included in the December 31, 2022 deferred revenues balance were recognized. There were additional deferrals of $101,577, which were primarily related to new billings and acquisitions. For the three months ended March 31, 2022, $97,005 of revenues that were included in the December 31, 2021 deferred revenues balance were recognized. There were additional deferrals of $94,522, which were primarily related to new billings and acquisitions.
As of March 31, 2023 and December 31, 2022, the Company has deferred $17,753 and $17,338, respectively, related to portfolio balancing exchange rights which is included in Deferred revenues in the consolidated balance sheets.
Remaining Performance Obligations
The Company’s contracts with customers include amounts allocated to performance obligations that will be satisfied at a later date. As of March 31, 2023, amounts allocated to these remaining performance obligations are $250,747, of which the Company expects to recognize approximately 94% over the next 12 months with the remaining amount thereafter.
Note 4: Acquisitions
The aggregate details of the Company’s acquisition activity are as follows:
| | | | | | | | | | | | | |
| Acquisitions Completed during |
| Three Months Ended | | |
| March 31, | | |
| 2023 | | 2022 | | |
| |
| | | | | |
Number of acquisitions | 1 | | | 1 | | | |
Cash paid at closing (1) | $ | 10,299 | | | $ | 715,114 | | | |
Cash acquired | — | | | (19,146) | | | |
Net cash paid | $ | 10,299 | | | $ | 695,968 | | | |
(1)Of the cash paid at closing for the three months ended March 31, 2022, $3,000 was deposited into an escrow account to secure any potential indemnification and other obligations of the seller.
On January 31, 2022, the Company completed the acquisition of Power Line Systems (“PLS”), a leader in software for the design of overhead electric power transmission lines and their structures, for $695,968 in cash, net of cash acquired. The operating results of the acquired businesses were not material, individually or in the aggregate, to the Company’s consolidated statements of operations.
The fair value of the contingent consideration from acquisitions is included in the consolidated balance sheets as follows:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Accruals and other current liabilities | $ | 955 | | | $ | 1,196 | |
| | | |
Contingent consideration from acquisitions | $ | 955 | | | $ | 1,196 | |
The fair value of non-contingent consideration from acquisitions is included in the consolidated balance sheets as follows:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Accruals and other current liabilities | $ | 2,861 | | | $ | 2,434 | |
Other liabilities | 3,061 | | | 2,977 | |
Non-contingent consideration from acquisitions | $ | 5,922 | | | $ | 5,411 | |
The operating results of the acquired businesses are included in the Company’s consolidated financial statements from the closing date of each respective acquisition. The purchase price for each acquisition has been allocated to the net tangible and intangible assets and liabilities based on their estimated fair values at the respective acquisition date.
The Company is in the process of finalizing the purchase accounting for one acquisition completed during the three months ended March 31, 2023 and one acquisition completed during the year ended December 31, 2022. Identifiable assets acquired and liabilities assumed were provisionally recorded at their estimated fair values on the respective acquisition date. The initial accounting for these business combinations is not complete because the evaluation necessary to assess the fair values of certain net assets acquired is still in process. The provisional amounts are subject to revision until the evaluations are completed to the extent that additional information is obtained about the facts and circumstances that existed as of the acquisition date. The allocation of the purchase price may be modified from the date of the acquisition as more information is obtained about the fair values of assets acquired and liabilities assumed, however, such measurement period cannot exceed one year.
Acquisition costs are expensed as incurred and are recorded in General and administrative in the consolidated statements of operations. For the three months ended March 31, 2023 and 2022, the Company’s acquisition expenses were $5,185 and $10,574, respectively, which include costs related to legal, accounting, valuation, insurance, general administrative, and other consulting and transaction fees. For the three months ended March 31, 2022, $9,773 of the Company’s acquisition expenses related to the acquisition of PLS.
The following summarizes the fair values of the assets acquired and liabilities assumed, as well as the weighted average useful lives assigned to acquired intangible assets at the respective date of each acquisition (including contingent consideration):
| | | | | | | | | | | | | |
| Acquisitions Completed in | | |
| Three Months Ended | | Year Ended | | |
| March 31, 2023 | | December 31, 2022 | | |
Consideration: | | | | | |
Cash paid at closing | $ | 10,299 | | | $ | 763,228 | | | |
| | | | | |
Contingent consideration | — | | | 1,390 | | | |
Deferred, non-contingent consideration, net | 525 | | | 749 | | | |
Other | — | | | (269) | | | |
Total consideration | $ | 10,824 | | | $ | 765,098 | | | |
Assets acquired and liabilities assumed: | | | | | |
Cash | $ | — | | | $ | 20,221 | | | |
Accounts receivable and other current assets | 1,488 | | | 8,890 | | | |
Operating lease right-of-use assets | 345 | | | 1,237 | | | |
Property and equipment | — | | | 1,316 | | | |
Other assets | — | | | 7 | | | |
Software and technology (weighted average useful life of 3 and 5 years, respectively) | 1,300 | | | 10,608 | | | |
Customer relationships (weighted average useful life of 6 and 10 years, respectively) | 3,900 | | | 82,278 | | | |
Trademarks (weighted average useful life of 5 and 8 years, respectively) | 800 | | | 6,972 | | | |
| | | | | |
| | | | | |
Total identifiable assets acquired excluding goodwill | 7,833 | | | 131,529 | | | |
Accruals and other current liabilities | — | | | (4,079) | | | |
Deferred revenues | (3,953) | | | (14,176) | | | |
Operating lease liabilities | (345) | | | (1,237) | | | |
Deferred income taxes | — | | | (5,745) | | | |
| | | | | |
Total liabilities assumed | (4,298) | | | (25,237) | | | |
Net identifiable assets acquired excluding goodwill | 3,535 | | | 106,292 | | | |
Goodwill | 7,289 | | | 658,806 | | | |
Net assets acquired | $ | 10,824 | | | $ | 765,098 | | | |
The fair values of the working capital, other assets (liabilities), and property and equipment approximated their respective carrying values as of the acquisition date.
Deferred revenues were determined in accordance with the Company’s revenue recognition policies.
The fair values of the intangible assets were primarily determined using the income approach. When applying the income approach, indications of fair values were developed by discounting future net cash flows to their present values at market‑based rates of return. The cash flows were based on estimates used to price the acquisitions and the discount rates applied were benchmarked with reference to the implied rate of return from the Company’s pricing model and the weighted average cost of capital.
Goodwill recorded in connection with the acquisitions was attributable to synergies expected to arise from cost saving opportunities, as well as future expected cash flows. The Company expects $7,289 of the goodwill recorded relating to the 2023 acquisition will be deductible for income tax purposes.
Note 5: Property and Equipment, Net
Property and equipment, net consist of the following:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
Land | $ | 2,811 | | | $ | 2,811 | |
Building and improvements | 36,216 | | | 35,717 | |
Computer equipment and software | 56,828 | | | 54,636 | |
Furniture, fixtures, and equipment | 14,456 | | | 14,600 | |
Aircraft | 2,038 | | | 2,038 | |
Other | 156 | | | 156 | |
Property and equipment, at cost | 112,505 | | | 109,958 | |
Less: Accumulated depreciation | (79,467) | | | (77,707) | |
Total property and equipment, net | $ | 33,038 | | | $ | 32,251 | |
Depreciation expense for the three months ended March 31, 2023 and 2022 was $2,724 and $2,490, respectively.
Related Party Equipment Sale
In January 2022, the Audit Committee of the Company’s Board of Directors authorized the Company to sell 50% of its interest in the Company’s aircraft at fair market value to an entity controlled by the Company’s Chief Executive Officer. The transaction was completed on February 1, 2022 for $2,380 and resulted in a gain of $2,029, which was recorded in Other income, net in the consolidated statements of operations for the three months ended March 31, 2022. Subsequent to the transaction, ongoing operating and fixed costs of the aircraft are shared on a proportional use basis subject to a cost-sharing agreement. Such costs were not material during the three months ended March 31, 2023 and 2022. The Company determined this transaction was with a related party.
Note 6: Goodwill and Other Intangible Assets
The changes in the carrying amount of goodwill are as follows:
| | | | | |
Balance, December 31, 2022 | $ | 2,237,184 | |
Acquisitions | 7,289 | |
Foreign currency translation adjustments | 4,082 | |
Other adjustments | (758) | |
Balance, March 31, 2023 | $ | 2,247,797 | |
Details of intangible assets other than goodwill are as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | March 31, 2023 | | December 31, 2022 |
| Estimated Useful Life | | Gross Carrying Amount | | Accumulated Amortization | | Net Book Value | | Gross Carrying Amount | | Accumulated Amortization | | Net Book Value |
Intangible assets subject to amortization: | | | | | | | | | | | | | |
Software and technology | 3-5 years | | $ | 92,960 | | | $ | (54,588) | | | $ | 38,372 | | | $ | 92,390 | | | $ | (51,938) | | | $ | 40,452 | |
Customer relationships | 3-10 years | | 326,025 | | | (122,414) | | | 203,611 | | | 323,164 | | | (114,387) | | | 208,777 | |
Trademarks | 3-10 years | | 70,465 | | | (28,605) | | | 41,860 | | | 69,803 | | | (26,904) | | | 42,899 | |
Non-compete agreements | 5 years | | 350 | | | (224) | | | 126 | | | 350 | | | (207) | | | 143 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Total intangible assets | | | $ | 489,800 | | | $ | (205,831) | | | $ | 283,969 | | | $ | 485,707 | | | $ | (193,436) | | | $ | 292,271 | |
The aggregate amortization expense for purchased intangible assets with finite lives was reflected in the Company’s consolidated statements of operations as follows:
| | | | | | | | | | | | | | | |
| | | Three Months Ended |
| | | March 31, |
| | | | | 2023 | | 2022 |
Cost of subscriptions and licenses | | | | | $ | 3,187 | | | $ | 3,022 | |
Amortization of purchased intangibles | | | | | 10,548 | | | 9,906 | |
Total amortization expense | | | | | $ | 13,735 | | | $ | 12,928 | |
Note 7: Investments
Investments consist of the following:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Cost method investments | $ | 31,914 | | | $ | 22,174 | |
Equity method investments | 96 | | | 96 | |
Total investments | $ | 32,010 | | | $ | 22,270 | |
Cost Method Investments
Through its iTwin Ventures initiative, the Company invests in technology development companies, generally in the form of equity interests or convertible notes. In March 2023, the Company acquired an equity interest in Worldsensing, a leading global connectivity hardware platform company for infrastructure monitoring, via contribution of its sensemetrics’ Thread connectivity device business (the “Thread business”) and cash. The non-cash contribution of the Thread business resulted in an insignificant gain, which was recorded in Other income, net in the consolidated statements of operations for the three months ended March 31, 2023. In July 2022, the Company acquired an equity interest in Teralytics Holdings AG, a global platform company for human mobility analysis.
During the three months ended March 31, 2023, the Company invested a total of $9,678, including $8,928 of cash and non-cash for our investment in Worldsensing. During the three months ended March 31, 2022, the Company invested a total of $2,111. As of March 31, 2023, our investment balance in Worldsensing and Teralytics Holdings AG was $8,928 and $11,130, respectively. As of December 31, 2022, our investment balance in Teralytics Holdings AG was $11,130.
Note 8: Leases
The Company’s operating leases consist of office facilities, office equipment, and automobiles. As of March 31, 2023, the Company’s leases have remaining terms of less than one year to eight years, some of which include one or more options to renew, with renewal terms from one year to ten years and some of which include options to terminate the leases from less than one year to five years.
The components of operating lease cost reflected in the consolidated statements of operations were as follows:
| | | | | | | | | | | |
| Three Months Ended |
| March 31, |
| 2023 | | 2022 |
Operating lease cost (1) | $ | 4,628 | | | $ | 5,753 | |
Variable lease cost | 1,202 | | | 1,273 | |
Short-term lease cost | — | | | 5 | |
Total operating lease cost | $ | 5,830 | | | $ | 7,031 | |
(1)Operating lease cost includes rent cost related to operating leases for office facilities of $4,417 and $5,553 for the three months ended March 31, 2023 and 2022, respectively.
Supplemental operating cash flow and other information related to leases was as follows:
| | | | | | | | | | | |
| Three Months Ended |
| March 31, |
| 2023 | | 2022 |
Cash paid for operating leases included in operating cash flows | $ | 4,710 | | | $ | 5,114 | |
Right-of-use assets obtained in exchange for new operating lease liabilities (1) | $ | 2,797 | | | $ | 2,876 | |
(1)Right‑of‑use assets obtained in exchange for new operating lease liabilities does not include the impact from acquisitions of $345 and $1,237 for the three months ended March 31, 2023 and 2022, respectively.
The weighted average remaining lease term for operating leases was 3.8 years and 3.9 years as of March 31, 2023 and December 31, 2022, respectively. The weighted average discount rate was 3.6% and 3.4% as of March 31, 2023 and December 31, 2022, respectively.
As of March 31, 2023, the Company had additional minimum operating lease payments of $1,196 for executed leases that have not yet commenced, primarily for office locations.
Note 9: Accruals and Other Current Liabilities
Accruals and other current liabilities consist of the following:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Cloud Services Subscription (“CSS”) deposits | $ | 263,975 | | | $ | 201,082 | |
Accrued benefits | 41,253 | | | 35,493 | |
Accrued compensation | 39,467 | | | 40,296 | |
Due to customers | 14,666 | | | 13,720 | |
Accrued indirect taxes | 8,761 | | | 9,766 | |
Accrued acquisition stay bonus | 7,384 | | | 9,135 | |
Accrued cloud provisioning costs | 3,751 | | | 4,224 | |
Accrued professional fees | 3,353 | | | 4,984 | |
Non-contingent consideration from acquisitions | 2,861 | | | 2,434 | |
Employee stock purchase plan contributions | 2,785 | | | 5,230 | |
Deferred compensation plan liabilities | 2,133 | | | 2,067 | |
Contingent consideration from acquisitions | 955 | | | 1,196 | |
Other accrued and current liabilities | 29,591 | | | 32,421 | |
Total accruals and other current liabilities | $ | 420,935 | | | $ | 362,048 | |
Note 10: Long-Term Debt
Long‑term debt consists of the following:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Credit facility: | | | |
Revolving loan facility due November 2025 | $ | 239,613 | | | $ | 345,597 | |
Term loan due November 2025 | 193,750 | | | 195,000 | |
Convertible senior notes due January 2026 (the “2026 Notes”) | 687,830 | | | 687,830 | |
Convertible senior notes due July 2027 (the “2027 Notes”) | 575,000 | | | 575,000 | |
Unamortized debt issuance costs | (21,162) | | | (22,731) | |
Total debt | 1,675,031 | | | 1,780,696 | |
Less: Current portion of long-term debt | (6,250) | | | (5,000) | |
Long-term debt | $ | 1,668,781 | | | $ | 1,775,696 | |
The Company had $150 of letters of credit and surety bonds outstanding as of March 31, 2023 and December 31, 2022 under the credit facility. As of March 31, 2023 and December 31, 2022, the Company had $610,237 and $504,253, respectively, available under the credit facility.
As of March 31, 2023 and December 31, 2022, the Company was in compliance with all debt covenants and none of the conditions of the 2026 Notes or 2027 Notes to early convert had been met.
Interest Expense, Net
Interest expense, net consists of the following:
| | | | | | | | | | | | | | | |
| | | Three Months Ended |
| | | March 31, |
| | | | | 2023 | | 2022 |
Contractual interest expense | | | | | $ | (9,310) | | | $ | (4,047) | |
Amortization of deferred debt issuance costs | | | | | (1,823) | | | (1,778) | |
Other interest expense | | | | | (188) | | | (1,005) | |
Interest income | | | | | 229 | | | 82 | |
Interest expense, net | | | | | $ | (11,092) | | | $ | (6,748) | |
The Company’s revolving loan facility and term loan weighted average interest rate was 6.67% and 2.32% for the three months ended March 31, 2023 and 2022, respectively.
Note 11: Executive Bonus Plan
For the three months ended March 31, 2023 and 2022, the incentive compensation, including cash payments, election to receive shares of fully vested Class B Common Stock, and deferred compensation to plan participants, recognized under the amended and restated Bentley Systems, Incorporated Bonus Pool Plan (the “Bonus Plan”) (net of all applicable holdbacks) was $7,948 and $9,719, respectively.
Note 12: Retirement Plans
Deferred Compensation Plan
Deferred compensation plan expense (income) was $4,146 and $(5,138) for the three months ended March 31, 2023 and 2022, respectively.
For the three months ended March 31, 2023 and 2022, elective participant deferrals into the Company’s unfunded amended and restated Bentley Systems, Incorporated Nonqualified Deferred Compensation Plan (the “DCP”) were $1,533 and $669, respectively. No discretionary contributions were made to the DCP during the three months ended March 31, 2023 and 2022. As of March 31, 2023 and December 31, 2022, phantom shares of the Company’s Class B Common Stock issuable by the DCP were 20,231,452 and 21,587,831, respectively.
The total liabilities related to the DCP is included in the consolidated balance sheets as follows:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Accruals and other current liabilities | $ | 2,133 | | | $ | 2,067 | |
Deferred compensation plan liabilities | 80,674 | | | 77,014 | |
Total DCP liabilities | $ | 82,807 | | | $ | 79,081 | |
Note 13: Common Stock
BSY Stock Repurchase Program
On May 11, 2022, the Company announced that its Board of Directors approved the BSY Stock Repurchase Program (the “Repurchase Program”) authorizing the Company to repurchase up to $200,000 of the Company’s Class B Common Stock through June 30, 2024. On December 14, 2022, the Company’s Board of Directors amended the Repurchase Program to allow the Company also to repurchase its outstanding convertible senior notes. This additional authorization did not increase the overall dollar limit of the Repurchase Program. The shares and notes proposed to be acquired in the Repurchase Program may be repurchased from time to time in open market transactions, through privately negotiated transactions, or by other means in accordance with federal securities laws. The Company intends to fund repurchases from available working capital and cash provided by operating activities. The timing, as well as the number and value of shares and/or notes repurchased under the Repurchase Program, will be determined by the Company at its discretion and will depend on a variety of factors, including management’s assessment of the intrinsic value of the Company’s shares, the market price of the Company’s Class B Common Stock and outstanding notes, general market and economic conditions, available liquidity, compliance with the Company’s debt and other agreements, and applicable legal requirements. The exact number of shares and/or notes to be repurchased by the Company is not guaranteed, and the Repurchase Program may be suspended, modified, or discontinued at any time without prior notice. As of March 31, 2023, $169,752 was available under the Company’s Board of Directors authorization for future repurchases of Class B Common Stock and/or outstanding convertible senior notes under the Repurchase Program.
Common Stock Issuances, Sales, and Repurchases
For the three months ended March 31, 2023, the Company issued 928,300 shares of Class B Common Stock to colleagues who exercised their stock options, net of 73,822 shares withheld at exercise to pay for the cost of the stock options, as well as for $1,701 of applicable income tax withholdings. The Company received $4,202 in proceeds from the exercise of stock options. For the three months ended March 31, 2022, the Company issued 1,401,249 shares of Class B Common Stock to colleagues who exercised their stock options, net of 314,659 shares withheld at exercise to pay for the cost of the stock options, as well as for $7,651 of applicable income tax withholdings. The Company received $2,768 in proceeds from the exercise of stock options.
For the three months ended March 31, 2022, the Company issued 149,855 shares of Class B Common Stock related to the exercise of acquisition options, net of 585,145 shares withheld at exercise to pay for the cost of the options. The Company did not receive any proceeds from the exercise of these options.
For the three months ended March 31, 2023 and 2022, the Company issued 79,804 and 72,105 shares of Class B Common Stock, respectively, in connection with Bonus Plan incentive compensation, net of shares withheld. Of the total 143,114 shares awarded for the three months ended March 31, 2023, 63,310 shares were sold back to the Company in the same period to pay for applicable income tax withholdings of $2,425. Of the total 128,496 shares awarded for the three months ended March 31, 2022, 56,391 shares were sold back to the Company in the same period to pay for applicable income tax withholdings of $2,192.
For the three months ended March 31, 2023 and 2022, the Company issued 1,052,738 and 809,751 shares of Class B Common Stock, respectively, to DCP participants in connection with distributions from the plan. The distribution in shares for the three months ended March 31, 2023 totaled 1,421,471 shares of which 368,733 shares were sold back to the Company in the same period to pay for applicable income tax withholdings of $13,626. The distribution in shares for the three months ended March 31, 2022 totaled 1,310,061 shares of which 500,310 shares were sold back to the Company in the same period to pay for applicable income tax withholdings of $24,246.
Dividends
The Company declared cash dividends during the periods presented as follows:
| | | | | | | | | | | |
| Dividend | | |
| Per Share | | Amount |
2023: | | | |
| | | |
| | | |
First quarter | $ | 0.05 | | | $ | 14,522 | |
2022: | | | |
| | | |
| | | |
First quarter | $ | 0.03 | | | $ | 8,353 | |
Global Employee Stock Purchase Plan
During the three months ended March 31, 2023, colleagues who elected to participate in the Bentley Systems, Incorporated Global Employee Stock Purchase Plan (the “ESPP”) purchased a total of 153,381 shares of Class B Common Stock, net of shares withheld, resulting in cash proceeds to the Company of $4,557. Of the total 159,377 shares purchased, 5,996 shares were sold back to the Company to pay for applicable income tax withholdings of $222. During the three months ended March 31, 2022, colleagues who elected to participate in the ESPP purchased a total of 109,749 shares of Class B Common Stock, net of shares withheld, resulting in cash proceeds to the Company of $4,611. Of the total 112,249 shares purchased, 2,500 shares were sold back to the Company to pay for applicable income tax withholdings of $121. As of March 31, 2023 and December 31, 2022, $2,785 and $5,230 of ESPP withholdings via colleague payroll deduction were recorded in Accruals and other current liabilities in the consolidated balance sheets, respectively. As of March 31, 2023, shares of Class B Common Stock available for future issuance under the ESPP were 24,434,497.
Note 14: Accumulated Other Comprehensive Loss
Accumulated other comprehensive loss consists of the following during the three months ended March 31, 2023 and 2022:
| | | | | | | | | | | | | | | | | |
| Foreign | | Actuarial (Loss) | | |
| Currency | | Gain on | | |
| Translation | | Retirement Plan | | Total |
Balance, December 31, 2022 | $ | (89,408) | | | $ | (332) | | | $ | (89,740) | |
Other comprehensive income, before taxes | 340 | | | 32 | | | 372 | |
Tax expense | — | | | (6) | | | (6) | |
Other comprehensive income, net of taxes | 340 | | | 26 | | | 366 | |
Balance, March 31, 2023 | $ | (89,068) | | | $ | (306) | | | $ | (89,374) | |
| | | | | | | | | | | | | | | | | |
| Foreign | | Actuarial (Loss) | | |
| Currency | | Gain on | | |
| Translation | | Retirement Plan | | Total |
Balance, December 31, 2021 | $ | (90,867) | | | $ | (907) | | | $ | (91,774) | |
Other comprehensive income, before taxes | 16,437 | | | 18 | | | 16,455 | |
Tax expense | — | | | (5) | | | (5) | |
Other comprehensive income, net of taxes | 16,437 | | | 13 | | | 16,450 | |
Balance, March 31, 2022 | $ | (74,430) | | | $ | (894) | | | $ | (75,324) | |
Note 15: Stock-Based Compensation
Total stock‑based compensation expense consists of the following:
| | | | | | | | | | | | | | | |
| | | Three Months Ended |
| | | March 31, |
| | | | | 2023 | | 2022 |
Restricted stock and restricted stock units (“RSUs”) expense | | | | | $ | 13,923 | | | $ | 5,365 | |
Bonus Plan expense (see Note 11) | | | | | 4,546 | | | 8,161 | |
ESPP expense (see Note 13) | | | | | 575 | | | 680 | |
Stock option expense | | | | | 343 | | | 756 | |
| | | | | | | |
DCP elective participant deferrals expense (1) (see Note 12) | | | | | 97 | | | 137 | |
Total stock-based compensation expense (2) | | | | | $ | 19,484 | | | $ | 15,099 | |
(1)DCP elective participant deferrals expense excludes deferred incentive bonus payable pursuant to the Bonus Plan.
(2)As of March 31, 2023 and December 31, 2022, $5,213 and $7,300 remained in Accruals and other current liabilities in the consolidated balance sheets, respectively.
Total stock‑based compensation expense is included in the consolidated statements of operations as follows:
| | | | | | | | | | | | | | | |
| | | Three Months Ended |
| | | March 31, |
| | | | | 2023 | | 2022 |
Cost of subscriptions and licenses | | | | | $ | 1,034 | | | $ | 385 | |
Cost of services | | | | | 1,007 | | | 383 | |
Research and development | | | | | 5,286 | | | 5,395 | |
Selling and marketing | | | | | 2,870 | | | 1,454 | |
General and administrative | | | | | 9,287 | | | 7,482 | |
Total stock-based compensation expense | | | | | $ | 19,484 | | | $ | 15,099 | |
Stock‑based compensation expense is measured at the grant date fair value of the award and is recognized ratably over the requisite service period, which is generally the vesting period. Specifically for performance‑based RSUs, stock‑based compensation expense is measured at the grant date fair value of the award and is recognized ratably over the requisite service period based on the number of awards expected to vest at each reporting date. The Company accounts for forfeitures of equity awards as those forfeitures occur.
Stock Options
The following is a summary of stock option activity and related information under the Company’s applicable equity incentive plans:
| | | | | | | | | | | | | | | | | | | | | | | |
| | | | | Weighted | | |
| | | Weighted | | Average | | |
| | | Average | | Remaining | | Aggregate |
| Stock | | Exercise Price | | Contractual | | Intrinsic |
| Options | | Per Share | | Life (in years) | | Value |
Outstanding, December 31, 2022 | 3,794,515 | | | $ | 5.57 | | | | | |
Exercised | (1,002,122) | | | 5.46 | | | | | |
Forfeited and expired | (7,500) | | | 5.60 | | | | | |
Outstanding, March 31, 2023 | 2,784,893 | | | $ | 5.62 | | | 0.7 | | $ | 104,084 | |
Exercisable, March 31, 2023 | 2,782,393 | | | $ | 5.62 | | | 0.7 | | $ | 103,991 | |
For the three months ended March 31, 2023 and 2022, the Company received cash proceeds of $4,202 and $2,768, respectively, related to the exercise of stock options. The total intrinsic value of stock options exercised for the three months ended March 31, 2023 and 2022 was $35,076 and $62,025, respectively.
As of March 31, 2023, there was no remaining unrecognized compensation expense related to unvested stock options.
Restricted Stock and RSUs
Under the equity incentive plans, the Company may grant both time‑based and performance‑based shares of restricted Class B Common Stock and RSUs to eligible colleagues. Time‑based awards generally vest ratably on each of the first four anniversaries of the grant date. Performance‑based awards vesting is determined by the achievement of certain business profitability and growth targets, which include growth in annualized recurring revenues (“ARR”), as well as actual bookings for perpetual licenses and non‑recurring services, and certain non‑financial performance targets. Performance targets are generally set for performance periods of one to three years.
The following is a summary of unvested restricted stock and RSU activity and related information under the Company’s applicable equity incentive plans:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | Time- | | Performance- |
| | | | | | | Based | | Based |
| | | Time- | | | | Weighted | | Weighted |
| Total | | Based | | | | Average | | Average |
| Restricted | | Restricted | | Performance- | | Grant Date | | Grant Date |
| Stock | | Stock | | Based | | Fair Value | | Fair Value |
| and RSUs | | and RSUs | | RSUs | | Per Share | | Per Share |
Unvested, December 31, 2022 | 3,068,851 | | | 2,706,078 | | (3) | 362,773 | | (4) | $ | 36.67 | | | $ | 38.21 | |
Granted | 1,152,992 | | (1) | 962,574 | | | 190,418 | | (5) | 41.09 | | 38.93 |
Vested | (370,127) | | | (212,967) | | | (157,160) | | | 39.37 | | | 38.20 | |
Forfeited and canceled | (38,959) | | | (30,165) | | | (8,794) | | | 27.23 | | | 34.36 | |
Unvested, March 31, 2023 | 3,812,757 | | (2) | 3,425,520 | | | 387,237 | | | 37.83 | | | 38.65 | |
(1)For the three months ended March 31, 2023, the Company only granted RSUs.
(2)Includes 68,159 RSUs which are expected to be settled in cash.
(3)Includes 199,076 time‑based RSUs granted during the three months ended March 31, 2022 to certain officers and key employees, which cliff vest on January 31, 2025.
(4)Primarily relates to the 2022 annual performance period, except for 185,186 performance‑based RSUs granted during the year ended December 31, 2022 with extraordinary terms, which are described below.
(5)Primarily relates to the 2023 annual performance period, except for 13,367 additional shares earned based on the achievement of 2022 performance goals for performance‑based RSUs granted during the year ended December 31, 2022.
During the year ended December 31, 2022, the Company granted 185,186 performance‑based RSUs to certain officers and key employees, which vest subject to the achievement of certain performance goals over a three‑year performance period (the “Performance Period”). For each year of the Performance Period, one‑third of the performance‑based RSUs will be subject to a cliff, whereby no vesting of that portion will occur unless the Company’s applicable margin metrics (which, for 2022, was Adjusted EBITDA margin and for 2023 and 2024, will be Adjusted operating income inclusive of stock-based compensation expense (“Adjusted OI w/SBC”) margin, excluding the impact of currency exchange fluctuations) also equals or exceeds the relevant target level for such year. Provided that the applicable margin targets are met, the total number of performance‑based RSUs that will vest is determined by the achievement of growth targets, which include growth in ARR, as well as actual bookings for perpetual licenses and non‑recurring services. Final actual vesting will be determined on January 31, 2025. The 2022 Adjusted EBITDA margin target for the performance‑based RSUs was met.
In 2016, the Company granted RSUs subject to performance‑based vesting as determined by the achievement of certain business growth targets. Certain colleagues elected to defer delivery of such shares upon vesting. During the three months ended March 31, 2023, 7 shares were earned as a result of dividends. During the three months ended March 31, 2022, 10,888 shares were delivered to colleagues and 7 additional shares were earned as a result of dividends. As of March 31, 2023 and December 31, 2022, 9,370 and 9,363 shares, respectively, of these vested and deferred RSUs remained outstanding.
The weighted average grant date fair values of RSUs granted were $40.73 and $39.26, for the three months ended March 31, 2023 and 2022, respectively.
For the three months ended March 31, 2023 and 2022, restricted stock and RSUs were issued net of 78,993 and 38,955 shares, respectively, which were sold back to the Company to settle applicable income tax withholdings of $3,025 and $1,555, respectively.
As of March 31, 2023, there was $104,808 of unrecognized compensation expense related to unvested time‑based restricted stock and RSUs, which is expected to be recognized over a weighted average period of approximately 2.0 years. As of March 31, 2023, there was $11,651 of unrecognized compensation expense related to unvested performance‑based RSUs, which is expected to be recognized over a weighted average period of approximately 1.3 years.
Note 16: Income Taxes
The following is a summary of Income before income taxes, Provision for income taxes, and effective tax rate for the periods presented:
| | | | | | | | | | | | | | | |
| | | Three Months Ended |
| | | March 31, |
| | | | | 2023 | | 2022 |
Income before income taxes | | | | | $ | 54,982 | | | $ | 60,191 | |
Provision for income taxes | | | | | $ | 9,492 | | | $ | 3,231 | |
Effective tax rate | | | | | 17.3 | % | | 5.4 | % |
For the three months ended March 31, 2023, the effective tax rate was higher primarily due to the decrease in discrete tax benefits recognized in the current year period. For the three months ended March 31, 2023 and 2022, the Company recorded tax benefits of $7,073 and $12,728, respectively, primarily associated with windfall tax benefits from stock‑based compensation, net of the impact from officer compensation limitation provisions.
Note 17: Fair Value of Financial Instruments
A financial asset or liability classification is determined based on the lowest level input that is significant to the fair value measurement. The fair value hierarchy consists of the following three levels:
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.
Level 3 inputs are unobservable inputs based on management’s own assumptions used to measure assets and liabilities at fair value.
The Company’s financial instruments include cash equivalents, account receivables, certain other assets, accounts payable, accruals, certain other current and long‑term liabilities, and long‑term debt.
Current assets and current liabilities — In general, the carrying amounts reported on the Company’s consolidated balance sheets for current assets and current liabilities approximate their fair values due to the short‑term nature of those instruments.
The following methods and assumptions were used by the Company in estimating its fair value measurements for Level 2 and Level 3 financial instruments as of March 31, 2023 and December 31, 2022:
Acquisition contingent consideration — The fair value of these liabilities is generally determined using a cost or income approach and is measured based on significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The valuation of contingent consideration uses assumptions the Company believes would be made by a market participant.
Interest rate swap — The fair value of the Company’s interest rate swap asset or liability is determined using an income approach and is measured based on the implied forward rates from the U.S. dollar one‑month LIBOR yield curve. The Company considers these valuation inputs to be Level 2 inputs in the fair value hierarchy.
Long-term debt — The fair value of the Company’s borrowings under its Credit Facility approximated its carrying value based upon discounted cash flows at current market rates for instruments with similar remaining terms. The Company considers these valuation inputs to be Level 2 inputs in the fair value hierarchy. As of March 31, 2023, the estimated fair value of the 2026 Notes and 2027 Notes was $644,572 and $487,376, respectively. As of December 31, 2022, the estimated fair value of the 2026 Notes and 2027 Notes was $622,431 and $470,856, respectively. The estimated fair value of the 2026 Notes and 2027 Notes is based on quoted market prices of the Company’s instrument in markets that are not active and are classified as Level 2 within the fair value hierarchy. Considerable judgment is necessary to interpret the market data and develop estimates of fair values. Accordingly, the estimates presented are not necessarily indicative of the amounts at which these instruments could be purchased, sold, or settled.
Deferred compensation plan liabilities — The fair value of deferred compensation plan liabilities, including the liability classified phantom investments in the DCP, are marked to market at the end of each reporting period.
Financial assets and financial liabilities carried at fair value measured on a recurring basis consist of the following:
| | | | | | | | | | | | | | | | | | | | | | | |
March 31, 2023 | Level 1 | | Level 2 | | Level 3 | | Total |
Assets: | | | | | | | |
Money market funds (1) | $ | 6,578 | | | $ | — | | | $ | — | | | $ | 6,578 | |
Interest rate swap (2) | — | | | 32,711 | | | — | | | 32,711 | |
Total assets | $ | 6,578 | | | $ | 32,711 | | | $ | — | | | $ | 39,289 | |
Liabilities: | | | | | | | |
Acquisition contingent consideration (3) | $ | — | | | $ | — | | | $ | 955 | | | $ | 955 | |
Deferred compensation plan liabilities (4) | 82,807 | | | — | | | — | | | 82,807 | |
Cash-settled equity awards (5) | 823 | | | — | | | — | | | 823 | |
Total liabilities | $ | 83,630 | | | $ | — | | | $ | 955 | | | $ | 84,585 | |
| | | | | | | | | | | | | | | | | | | | | | | |
December 31, 2022 | Level 1 | | Level 2 | | Level 3 | | Total |
Assets: | | | | | | | |
Money market funds (1) | $ | 19 | | | $ | — | | | $ | — | | | $ | 19 | |
Interest rate swap (2) | — | | | 37,200 | | | — | | | 37,200 | |
Total assets | $ | 19 | | | $ | 37,200 | | | $ | — | | | $ | 37,219 | |
Liabilities: | | | | | | | |
Acquisition contingent consideration (3) | $ | — | | | $ | — | | | $ | 1,196 | | | $ | 1,196 | |
Deferred compensation plan liabilities (4) | 79,081 | | | — | | | — | | | 79,081 | |
Cash-settled equity awards (5) | 536 | | | — | | | — | | | 536 | |
Total liabilities | $ | 79,617 | | | $ | — | | | $ | 1,196 | | | $ | 80,813 | |
(1)Included in Cash and cash equivalents in the consolidated balance sheets.
(2)Included in Other assets in the consolidated balance sheets.
(3)Included in Accruals and other current liabilities in the consolidated balance sheets.
(4)Included in Deferred compensation plan liabilities, except for current liabilities of $2,133 and $2,067 as of March 31, 2023 and December 31, 2022, respectively, which are included in Accruals and other current liabilities in the consolidated balance sheets.
(5)Included in Accruals and other current liabilities in the consolidated balance sheets.
The following is a reconciliation of the changes in fair value of the Company’s financial liabilities which have been classified as Level 3 in the fair value hierarchy:
| | | | | | | | | | | |
| Three Months Ended | | Year Ended |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Balance, beginning of year | $ | 1,196 | | | $ | 6,613 | |
Payments | (249) | | | (5,261) | |
Addition | — | | | 1,390 | |
Change in fair value | — | | | (1,427) | |
Foreign currency translation adjustments | 8 | | | (119) | |
Balance, end of period | $ | 955 | | | $ | 1,196 | |
The Company did not have any transfers between levels within the fair value hierarchy.
Note 18: Commitments and Contingencies
Purchase Commitment — In the normal course of business, the Company enters into various purchase commitments for goods and services. As of March 31, 2023, the non‑cancelable future cash purchase commitment for services related to the cloud provisioning of the Company’s software solutions was $5,516 through May 2023. The Company expects to fully consume its contractual commitment in the ordinary course of operations.
Litigation — From time to time, the Company is involved in certain legal actions arising in the ordinary course of business. In management’s opinion, based upon the advice of counsel, the outcome of such actions is not expected to have a material adverse effect on the Company’s future financial position, results of operations, or cash flows.
Note 19: Geographic Data
Revenues by geographic region are presented in Note 3. Long‑lived assets (other than goodwill), net of depreciation and amortization by geographic region (see Notes 5, 6, and 8) are as follows:
| | | | | | | | | | | |
| March 31, 2023 | | December 31, 2022 |
| |
| | | |
Americas (1) | $ | 163,636 | | | $ | 164,729 | |
EMEA | 31,359 | | | 32,372 | |
APAC | 160,958 | | | 167,670 | |
Total long-lived assets | $ | 355,953 | | | $ | 364,771 | |
(1)Americas includes the U.S., Canada, and Latin America (including the Caribbean).
Note 20: Other Income, Net
Other income, net consists of the following:
| | | | | | | | | | | | | | | |
| | | Three Months Ended |
| | | March 31, |
| | | | | 2023 | | 2022 |
(Loss) gain from: | | | | | | | |
Change in fair value of interest rate swap (see Note 17) | | | | | $ | (4,489) | | | $ | 12,084 | |
Foreign exchange (1) | | | | | 1,454 | | | (3,071) | |
Sale of aircraft (see Note 5) | | | | | — | | | 2,029 | |
| | | | | | | |
Change in fair value of acquisition contingent consideration (See Note 17) | | | | | — | | | (500) | |
Receipts (payments) related to interest rate swap | | | | | 1,920 | | | (294) | |
Other income, net | | | | | 1,404 | | | 99 | |
Total other income, net | | | | | $ | 289 | | | $ | 10,347 | |
(1)Foreign exchange gain (loss) is primarily attributable to foreign currency translation derived mainly from U.S. dollar denominated cash and cash equivalents, account receivables, customer deposits, and intercompany balances held by foreign subsidiaries. Intercompany finance transactions primarily denominated in U.S. dollars resulted in unrealized foreign exchange gains (losses) of $861 and $(764) for the three months ended March 31, 2023 and 2022, respectively.
Note 21: Net Income Per Share
The Company issues certain performance-based RSUs determined to be participating securities because holders of such shares have non-forfeitable dividend rights in the event of the Company’s declaration of a dividend for common shares. As of March 31, 2023 and 2022, there were 387,237 and 305,785 participating securities outstanding, respectively.
Undistributed net income allocated to participating securities are subtracted from net income in determining basic net income attributable to common stockholders. Basic net income per share is computed by dividing basic net income attributable to common stockholders by the weighted average number of shares, inclusive of undistributed shares held in the DCP as phantom shares of the Company’s Class B Common Stock.
For the Company’s diluted net income per share numerator, interest expense, net of tax, attributable to the assumed conversion of the convertible senior notes is added back to basic net income attributable to common stockholders. For the Company’s diluted net income per share denominator, the basic weighted average number of shares is adjusted for the effect of dilutive securities, including awards under the Company’s equity compensation plans and ESPP, and for the dilutive effect of the assumed conversion of the convertible senior notes. Diluted net income per share attributable to common stockholders is computed by dividing diluted net income attributable to common stockholders by the weighted average number of fully diluted common shares.
Except with respect to voting and conversion, the rights of the holders of the Company’s Class A Common Stock and the Company’s Class B Common Stock are identical. Each class of shares has the same rights to dividends and allocation of income (loss) and, therefore, net income per share would not differ under the two‑class method.
The details of basic and diluted net income per share are as follows:
| | | | | | | | | | | | | | |
| | Three Months Ended |
| | March 31, |
| | 2023 | | 2022 |
Numerator: | | | | |
Net income | | $ | 45,490 | | | $ | 56,388 | |
Less: Net income attributable to participating securities | | (19) | | | (9) | |
Net income attributable to Class A and Class B common stockholders, basic | | 45,471 | | | 56,379 | |
Add: Interest expense, net of tax, attributable to assumed conversion of convertible senior notes | | 1,717 | | | 1,695 | |
Net income attributable to Class A and Class B common stockholders, diluted | | $ | 47,188 | | | $ | 58,074 | |
| | | | |
Denominator: | | | | |
Weighted average shares, basic | | 310,758,802 | | | 307,969,672 | |
Dilutive effect of stock options, restricted stock, and RSUs | | 2,844,855 | | | 5,542,252 | |
Dilutive effect of ESPP | | 14,441 | | | 150,709 | |
Dilutive effect of assumed conversion of convertible senior notes | | 17,633,786 | | | 17,667,623 | |
Weighted average shares, diluted | | 331,251,884 | | | 331,330,256 | |
| | | | |
Net income per share, basic | | $ | 0.15 | | | $ | 0.18 | |
Net income per share, diluted | | $ | 0.14 | | | $ | 0.18 | |
The following potential common shares were excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been anti‑dilutive for the periods presented:
| | | | | | | | | | | |
| Three Months Ended |
| March 31, |
| 2023 | | 2022 |
RSUs | 87,388 | | | 1,282,161 | |
| | | |
| | | |
Total anti-dilutive securities | 87,388 | | | 1,282,161 | |