|
|
|
|
Delaware
|
|
26-0138832
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification Number)
|
|
|
|
|
|
|
|
|
Title of each class
|
Trading Symbol(s)
|
Name of exchange on which registered
|
|
|
Class A Common Stock, par value $0.00001 per share
|
DBX
|
The NASDAQ Stock Market LLC
|
|
|
|
|
(Nasdaq Global Select Market)
|
|
|
|
|
|
|
Large accelerated filer
|
☒
|
|
Accelerated filer
|
☐
|
||
|
|
|||||
Non-accelerated filer
|
☐
|
|
Smaller reporting company
|
☐
|
||
|
|
|
|
|
||
|
|
Emerging growth company
|
☐
|
•
|
our ability to retain and upgrade paying users;
|
•
|
our ability to attract new users or convert registered users to paying users;
|
•
|
our future financial performance, including trends in revenue, costs of revenue, gross profit or gross margin, operating expenses, paying users, and free cash flow;
|
•
|
our expectations regarding the potential impacts of the outbreak of the COVID-19 pandemic and related public health measures on our business, the business of our customers, suppliers and partners, and the economy;
|
•
|
our ability to compete successfully in competitive markets;
|
•
|
the demand for our platform or for content collaboration solutions in general;
|
•
|
possible harm caused by significant disruption of service or loss or unauthorized access to users’ content;
|
•
|
our ability to effectively integrate our platform with others;
|
•
|
our ability to respond to rapid technological changes;
|
•
|
our ability to achieve or maintain profitability;
|
•
|
our expectations and management of future growth;
|
•
|
our ability to grow due to our lack of a significant outbound sales force;
|
•
|
our ability to attract large organizations as users;
|
•
|
our ability to offer high-quality customer support;
|
•
|
our ability to manage our international expansion;
|
•
|
our ability to attract and retain key personnel and highly qualified personnel;
|
•
|
the expected timing and amount of our share repurchases;
|
•
|
our ability to protect our brand;
|
•
|
our ability to prevent serious errors or defects in our platform;
|
•
|
our ability to maintain, protect, and enhance our intellectual property; and
|
•
|
our ability to successfully identify, acquire, and integrate companies and assets.
|
|
|
Page
|
|
|
|
Item 1.
|
||
|
||
|
||
|
||
|
||
|
||
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
|
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 6.
|
||
|
||
|
|
As of
|
||||||
|
June 30, 2020
|
|
December 31, 2019
|
||||
|
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
334.1
|
|
|
$
|
551.3
|
|
Short-term investments
|
783.5
|
|
|
607.7
|
|
||
Trade and other receivables, net
|
45.6
|
|
|
36.7
|
|
||
Prepaid expenses and other current assets
|
59.1
|
|
|
47.5
|
|
||
Total current assets
|
1,222.3
|
|
|
1,243.2
|
|
||
Property and equipment, net
|
475.6
|
|
|
445.3
|
|
||
Operating lease right-of-use asset
|
701.6
|
|
|
657.9
|
|
||
Intangible assets, net
|
40.5
|
|
|
47.4
|
|
||
Goodwill
|
234.7
|
|
|
234.5
|
|
||
Other assets
|
67.6
|
|
|
70.9
|
|
||
Total assets
|
$
|
2,742.3
|
|
|
$
|
2,699.2
|
|
Liabilities and stockholders’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
26.3
|
|
|
$
|
40.7
|
|
Accrued and other current liabilities
|
134.5
|
|
|
161.9
|
|
||
Accrued compensation and benefits
|
71.1
|
|
|
101.4
|
|
||
Operating lease liability
|
82.6
|
|
|
79.9
|
|
||
Finance lease obligation
|
83.8
|
|
|
76.7
|
|
||
Deferred revenue
|
583.5
|
|
|
554.2
|
|
||
Total current liabilities
|
981.8
|
|
|
1,014.8
|
|
||
Operating lease liability, non-current
|
771.3
|
|
|
711.9
|
|
||
Finance lease obligation, non-current
|
152.1
|
|
|
138.2
|
|
||
Other non-current liabilities
|
33.7
|
|
|
25.9
|
|
||
Total liabilities
|
1,938.9
|
|
|
1,890.8
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Additional paid-in capital
|
2,560.4
|
|
|
2,531.3
|
|
||
Accumulated deficit
|
(1,764.4
|
)
|
|
(1,726.2
|
)
|
||
Accumulated other comprehensive income
|
7.4
|
|
|
3.3
|
|
||
Total stockholders’ equity
|
803.4
|
|
|
808.4
|
|
||
Total liabilities and stockholders’ equity
|
$
|
2,742.3
|
|
|
$
|
2,699.2
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
467.4
|
|
|
$
|
401.5
|
|
|
$
|
922.4
|
|
|
$
|
787.1
|
|
Cost of revenue(1)
|
102.5
|
|
|
102.9
|
|
|
205.6
|
|
|
201.3
|
|
||||
Gross profit
|
364.9
|
|
|
298.6
|
|
|
716.8
|
|
|
585.8
|
|
||||
Operating expenses(1)
|
|
|
|
|
|
|
|
||||||||
Research and development
|
185.8
|
|
|
162.4
|
|
|
367.6
|
|
|
312.4
|
|
||||
Sales and marketing
|
102.8
|
|
|
107.3
|
|
|
207.1
|
|
|
208.8
|
|
||||
General and administrative
|
63.5
|
|
|
62.9
|
|
|
102.5
|
|
|
119.9
|
|
||||
Total operating expenses
|
352.1
|
|
|
332.6
|
|
|
677.2
|
|
|
641.1
|
|
||||
Income (loss) from operations
|
12.8
|
|
|
(34.0
|
)
|
|
39.6
|
|
|
(55.3
|
)
|
||||
Interest income, net
|
0.1
|
|
|
3.2
|
|
|
2.5
|
|
|
6.9
|
|
||||
Other income, net
|
9.0
|
|
|
10.0
|
|
|
19.6
|
|
|
14.2
|
|
||||
Income (loss) before income taxes
|
21.9
|
|
|
(20.8
|
)
|
|
61.7
|
|
|
(34.2
|
)
|
||||
Benefit from (provision for) income taxes
|
(4.4
|
)
|
|
(0.6
|
)
|
|
(4.9
|
)
|
|
5.1
|
|
||||
Net income (loss)
|
$
|
17.5
|
|
|
$
|
(21.4
|
)
|
|
$
|
56.8
|
|
|
$
|
(29.1
|
)
|
Net income (loss) per share-basic and diluted:
|
|
|
|
|
|
|
|
||||||||
Basic net income (loss) per share
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.07
|
)
|
Diluted net income (loss) per share
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.07
|
)
|
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders, basic
|
414.1
|
|
|
412.4
|
|
|
415.7
|
|
|
411.5
|
|
||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders, diluted
|
420.5
|
|
|
412.4
|
|
|
419.7
|
|
|
411.5
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
$
|
4.5
|
|
|
$
|
4.7
|
|
|
$
|
8.0
|
|
|
$
|
7.7
|
|
Research and development
|
47.0
|
|
|
37.7
|
|
|
84.2
|
|
|
68.2
|
|
||||
Sales and marketing
|
9.5
|
|
|
8.8
|
|
|
16.2
|
|
|
15.9
|
|
||||
General and administrative(2)
|
15.6
|
|
|
16.9
|
|
|
8.0
|
|
|
31.9
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
17.5
|
|
|
$
|
(21.4
|
)
|
|
$
|
56.8
|
|
|
$
|
(29.1
|
)
|
Other comprehensive income, net of tax:
|
|
|
|
|
|
|
|
||||||||
Change in foreign currency translation adjustments
|
2.9
|
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
1.6
|
|
||||
Change in net unrealized gains on short-term investments
|
6.0
|
|
|
0.4
|
|
|
4.4
|
|
|
1.5
|
|
||||
Total other comprehensive income, net of tax
|
$
|
8.9
|
|
|
$
|
0.1
|
|
|
$
|
4.1
|
|
|
$
|
3.1
|
|
Comprehensive income (loss)
|
$
|
26.4
|
|
|
$
|
(21.3
|
)
|
|
$
|
60.9
|
|
|
$
|
(26.0
|
)
|
|
Three months ended June 30, 2020
|
|
Three months ended June 30, 2019
|
||||||||||||||||||||||||||||||||||||||||||
|
Class A and Class B Common Stock
|
|
Additional paid in capital
|
|
Accumulated
deficit
|
|
Accumulated other comprehensive income (loss)
|
|
Total stockholders' equity
|
|
Class A and Class B common stock
|
|
Additional
paid-in
capital
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
income (loss)
|
|
Total
stockholders’
equity
|
||||||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||||||||||
Balances at beginning of period
|
415.1
|
|
|
$
|
—
|
|
|
$
|
2,528.5
|
|
|
$
|
(1,726.6
|
)
|
|
$
|
(1.5
|
)
|
|
$
|
800.4
|
|
|
411.4
|
|
|
$
|
—
|
|
|
$
|
2,377.8
|
|
|
$
|
(1,674.7
|
)
|
|
$
|
1.8
|
|
|
$
|
704.9
|
|
Release of restricted stock units
|
3.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Shares repurchased for tax withholdings on release of restricted stock units and awards
|
(1.2
|
)
|
|
—
|
|
|
(11.0
|
)
|
|
(14.1
|
)
|
|
—
|
|
|
(25.1
|
)
|
|
(1.0
|
)
|
|
—
|
|
|
(18.6
|
)
|
|
(4.0
|
)
|
|
—
|
|
|
(22.6
|
)
|
||||||||||
Repurchases of common stock
|
(3.7
|
)
|
|
—
|
|
|
(34.6
|
)
|
|
(41.2
|
)
|
|
—
|
|
|
(75.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Exercise of stock options and awards
|
0.2
|
|
|
—
|
|
|
0.9
|
|
|
—
|
|
|
—
|
|
|
0.9
|
|
|
0.1
|
|
|
—
|
|
|
1.1
|
|
|
—
|
|
|
—
|
|
|
1.1
|
|
||||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
76.6
|
|
|
—
|
|
|
—
|
|
|
76.6
|
|
|
—
|
|
|
—
|
|
|
68.1
|
|
|
—
|
|
|
—
|
|
|
68.1
|
|
||||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
|
8.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
0.1
|
|
||||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
17.5
|
|
|
—
|
|
|
17.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21.4
|
)
|
|
—
|
|
|
(21.4
|
)
|
||||||||||
Balances at end of period
|
413.8
|
|
|
$
|
—
|
|
|
$
|
2,560.4
|
|
|
$
|
(1,764.4
|
)
|
|
$
|
7.4
|
|
|
$
|
803.4
|
|
|
413.4
|
|
|
$
|
—
|
|
|
$
|
2,428.4
|
|
|
$
|
(1,700.1
|
)
|
|
$
|
1.9
|
|
|
$
|
730.2
|
|
|
Six months ended June 30, 2020
|
|
Six months ended June 30, 2019
|
||||||||||||||||||||||||||||||||||||||||||
|
Class A and Class B Common Stock
|
|
Additional paid in capital
|
|
Accumulated
deficit
|
|
Accumulated other comprehensive income (loss)
|
|
Total stockholders' equity
|
|
Class A and Class B common stock
|
|
Additional
paid-in
capital
|
|
Accumulated
deficit
|
|
Accumulated
other
comprehensive
income (loss)
|
|
Total
stockholders’
equity
|
||||||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||||||||||
Balances at beginning of period
|
417.0
|
|
|
$
|
—
|
|
|
$
|
2,531.3
|
|
|
$
|
(1,726.2
|
)
|
|
$
|
3.3
|
|
|
$
|
808.4
|
|
|
409.6
|
|
|
$
|
—
|
|
|
$
|
2,337.5
|
|
|
$
|
(1,659.5
|
)
|
|
$
|
(1.2
|
)
|
|
$
|
676.8
|
|
Cumulative-effect adjustment from adoption of ASC 842
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
—
|
|
|
1.0
|
|
||||||||||
Release of restricted stock units
|
6.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Shares repurchased for tax withholdings on release of restricted stock units and awards
|
(2.2
|
)
|
|
—
|
|
|
(20.3
|
)
|
|
(23.7
|
)
|
|
—
|
|
|
(44.0
|
)
|
|
(2.0
|
)
|
|
—
|
|
|
(35.6
|
)
|
|
(12.5
|
)
|
|
—
|
|
|
(48.1
|
)
|
||||||||||
Repurchases of common stock
|
(7.4
|
)
|
|
—
|
|
|
(68.5
|
)
|
|
(71.3
|
)
|
|
—
|
|
|
(139.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Exercise of stock options and awards
|
0.3
|
|
|
—
|
|
|
1.5
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
|
0.3
|
|
|
—
|
|
|
2.0
|
|
|
—
|
|
|
—
|
|
|
2.0
|
|
||||||||||
Assumed stock options in connection with acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
||||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
116.4
|
|
|
—
|
|
|
—
|
|
|
116.4
|
|
|
—
|
|
|
—
|
|
|
123.7
|
|
|
—
|
|
|
—
|
|
|
123.7
|
|
||||||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.1
|
|
|
4.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.1
|
|
|
3.1
|
|
||||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
56.8
|
|
|
—
|
|
|
56.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29.1
|
)
|
|
—
|
|
|
(29.1
|
)
|
||||||||||
Balances at end of period
|
413.8
|
|
|
$
|
—
|
|
|
$
|
2,560.4
|
|
|
$
|
(1,764.4
|
)
|
|
$
|
7.4
|
|
|
$
|
803.4
|
|
|
413.4
|
|
|
$
|
—
|
|
|
$
|
2,428.4
|
|
|
$
|
(1,700.1
|
)
|
|
$
|
1.9
|
|
|
$
|
730.2
|
|
|
Six months ended June 30,
|
||||||
|
2020
|
|
2019
|
||||
|
|
|
|
||||
Cash flow from operating activities
|
|
|
|
||||
Net income (loss)
|
$
|
56.8
|
|
|
$
|
(29.1
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
79.6
|
|
|
91.9
|
|
||
Stock-based compensation
|
116.4
|
|
|
123.7
|
|
||
Net gains on equity investments
|
(17.5
|
)
|
|
(7.4
|
)
|
||
Amortization of deferred commissions
|
10.8
|
|
|
8.1
|
|
||
Other
|
(0.1
|
)
|
|
(7.6
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Trade and other receivables, net
|
(8.8
|
)
|
|
(8.5
|
)
|
||
Prepaid expenses and other current assets
|
(22.4
|
)
|
|
(18.5
|
)
|
||
Other assets
|
33.1
|
|
|
26.2
|
|
||
Accounts payable
|
(12.8
|
)
|
|
(1.8
|
)
|
||
Accrued and other current liabilities
|
(24.7
|
)
|
|
10.5
|
|
||
Accrued compensation and benefits
|
(30.3
|
)
|
|
(24.8
|
)
|
||
Deferred revenue
|
28.7
|
|
|
28.0
|
|
||
Other non-current liabilities
|
(26.2
|
)
|
|
(27.2
|
)
|
||
Tenant improvement allowance reimbursement
|
16.6
|
|
|
28.5
|
|
||
Net cash provided by operating activities
|
199.2
|
|
|
192.0
|
|
||
Cash flow from investing activities
|
|
|
|
||||
Capital expenditures
|
(53.9
|
)
|
|
(63.4
|
)
|
||
Business combinations, net of cash acquired
|
—
|
|
|
(171.6
|
)
|
||
Purchases of short-term investments
|
(429.2
|
)
|
|
(389.7
|
)
|
||
Proceeds from sales of short-term investments
|
145.3
|
|
|
181.0
|
|
||
Proceeds from maturities of short-term investments
|
138.9
|
|
|
161.6
|
|
||
Other
|
9.3
|
|
|
11.6
|
|
||
Net cash used in investing activities
|
(189.6
|
)
|
|
(270.5
|
)
|
||
Cash flow from financing activities
|
|
|
|
||||
Shares repurchased for tax withholdings on release of restricted stock units and awards
|
(44.0
|
)
|
|
(48.1
|
)
|
||
Proceeds from issuance of common stock, net of repurchases
|
1.5
|
|
|
2.0
|
|
||
Principal payments on finance lease obligations
|
(43.4
|
)
|
|
(50.6
|
)
|
||
Common stock repurchases
|
(139.8
|
)
|
|
—
|
|
||
Other
|
(0.5
|
)
|
|
(0.7
|
)
|
||
Net cash used in financing activities
|
(226.2
|
)
|
|
(97.4
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(0.6
|
)
|
|
0.2
|
|
||
Change in cash and cash equivalents
|
(217.2
|
)
|
|
(175.7
|
)
|
||
Cash and cash equivalents - beginning of period
|
551.3
|
|
|
519.3
|
|
||
Cash and cash equivalents - end of period
|
$
|
334.1
|
|
|
$
|
343.6
|
|
|
|
|
|
||||
Supplemental cash flow data:
|
|
|
|
||||
Property and equipment acquired under finance leases
|
$
|
64.4
|
|
|
$
|
75.4
|
|
•
|
Identification of the contract, or contracts, with a customer
|
•
|
Identification of the performance obligations in the contract
|
•
|
Determination of the transaction price
|
•
|
Allocation of the transaction price to the performance obligations in the contract
|
•
|
Recognition of revenue when, or as, the Company satisfies a performance obligation
|
•
|
One-tier RSUs, which have a service-based vesting condition over a four-year period. These awards typically have a cliff vesting period of one year and continue to vest quarterly thereafter. The Company began granting one-tier RSUs under its 2008 Plan in August 2015, and it continues to grant one-tier RSUs under its 2018 Plan. The Company recognizes compensation expense associated with one-tier RSUs ratably on a straight-line basis over the requisite service period and accounts for forfeitures in the period in which they occur.
|
•
|
Two-tier RSUs, which had both a service-based vesting condition and a Performance Vesting Condition. The Performance Vesting Condition was satisfied on the effectiveness of the registration statement related to the Company's IPO. Prior to August 2015, the Company granted two-tier RSUs under the 2008 Plan. The last grant date for two-tier RSUs was in May 2015. The Company recognized compensation expense associated with two-tier RSUs using the accelerated attribution method over the requisite service period.
|
Property and equipment
|
|
Useful life
|
|
|
|
Buildings
|
|
20 to 30 years
|
Datacenter and other computer equipment
|
|
3 to 5 years
|
Office equipment and other
|
|
3 to 7 years
|
Leasehold improvements
|
|
Lesser of estimated useful life or remaining lease term
|
Note 2.
|
Cash, Cash Equivalents and Short-Term Investments
|
|
As of June 30, 2020
|
||||||||||||||
|
Amortized Cost
|
|
Unrealized Gain
|
|
Unrealized Loss
|
|
Estimated Fair Value
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Cash
|
$
|
88.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
88.5
|
|
Cash equivalents
|
|
|
|
|
|
|
|
|
|
|
|
||||
Money market funds
|
241.6
|
|
|
—
|
|
|
(0.1
|
)
|
|
241.5
|
|
||||
Municipal securities
|
1.8
|
|
|
—
|
|
|
—
|
|
|
1.8
|
|
||||
Commercial paper
|
1.2
|
|
|
—
|
|
|
—
|
|
|
1.2
|
|
||||
Corporate notes and obligations
|
1.1
|
|
|
—
|
|
|
—
|
|
|
1.1
|
|
||||
Total cash and cash equivalents
|
$
|
334.2
|
|
|
$
|
—
|
|
|
$
|
(0.1
|
)
|
|
$
|
334.1
|
|
Short-term investments
|
|
|
|
|
|
|
|
||||||||
Corporate notes and obligations
|
358.3
|
|
|
3.3
|
|
|
(0.2
|
)
|
|
361.4
|
|
||||
U.S. Treasury securities
|
234.1
|
|
|
1.7
|
|
|
—
|
|
|
235.8
|
|
||||
Asset backed securities
|
83.0
|
|
|
0.7
|
|
|
(0.1
|
)
|
|
83.6
|
|
||||
Commercial paper
|
40.0
|
|
|
—
|
|
|
—
|
|
|
40.0
|
|
||||
U.S. agency obligations
|
27.8
|
|
|
0.1
|
|
|
—
|
|
|
27.9
|
|
||||
Certificates of deposit
|
26.0
|
|
|
—
|
|
|
—
|
|
|
26.0
|
|
||||
Municipal securities
|
5.9
|
|
|
0.1
|
|
|
—
|
|
|
6.0
|
|
||||
Foreign government obligations
|
2.8
|
|
|
—
|
|
|
—
|
|
|
2.8
|
|
||||
Total short-term investments
|
777.9
|
|
|
5.9
|
|
|
(0.3
|
)
|
|
783.5
|
|
||||
Total
|
$
|
1,112.1
|
|
|
$
|
5.9
|
|
|
$
|
(0.4
|
)
|
|
$
|
1,117.6
|
|
|
As of December 31, 2019
|
||||||||||||||
|
Amortized cost
|
|
Unrealized gain
|
|
Unrealized loss
|
|
Estimated fair value
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Cash
|
$
|
105.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
105.0
|
|
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
444.3
|
|
|
—
|
|
|
—
|
|
|
444.3
|
|
||||
Commercial paper
|
2.0
|
|
|
—
|
|
|
—
|
|
|
2.0
|
|
||||
Total cash and cash equivalents
|
$
|
551.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
551.3
|
|
Short-term investments
|
|
|
|
|
|
|
—
|
|
|||||||
Corporate notes and obligations
|
285.5
|
|
|
1.2
|
|
|
(0.1
|
)
|
|
286.6
|
|
||||
U.S. Treasury securities
|
171.0
|
|
|
0.3
|
|
|
—
|
|
|
171.3
|
|
||||
Asset backed securities
|
53.8
|
|
|
—
|
|
|
—
|
|
|
53.8
|
|
||||
Certificates of deposit
|
38.2
|
|
|
—
|
|
|
—
|
|
|
38.2
|
|
||||
U.S. agency obligations
|
27.2
|
|
|
—
|
|
|
—
|
|
|
27.2
|
|
||||
Commercial paper
|
24.2
|
|
|
—
|
|
|
—
|
|
|
24.2
|
|
||||
Supranational securities
|
4.0
|
|
|
—
|
|
|
—
|
|
|
4.0
|
|
||||
Municipal securities
|
2.4
|
|
|
—
|
|
|
—
|
|
|
2.4
|
|
||||
Total short-term investments
|
606.3
|
|
|
1.5
|
|
|
(0.1
|
)
|
|
607.7
|
|
||||
Total
|
$
|
1,157.6
|
|
|
$
|
1.5
|
|
|
$
|
(0.1
|
)
|
|
$
|
1,159.0
|
|
|
As of June 30, 2020
|
||||||
|
Amortized cost
|
|
Estimated fair value
|
||||
|
|
|
|
||||
Due within one year
|
434.1
|
|
|
435.7
|
|
||
Due between one to three years
|
304.2
|
|
|
307.9
|
|
||
Due after three years
|
39.6
|
|
|
39.9
|
|
||
Total
|
$
|
777.9
|
|
|
$
|
783.5
|
|
Note 3.
|
Fair Value Measurements
|
|
As of June 30, 2020
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
241.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
241.5
|
|
Municipal securities
|
—
|
|
|
1.8
|
|
|
—
|
|
|
1.8
|
|
||||
Commercial paper
|
—
|
|
|
1.2
|
|
|
—
|
|
|
1.2
|
|
||||
Corporate notes and obligations
|
—
|
|
|
1.1
|
|
|
—
|
|
|
1.1
|
|
||||
Total cash equivalents
|
$
|
241.5
|
|
|
$
|
4.1
|
|
|
$
|
—
|
|
|
$
|
245.6
|
|
Short-term investments
|
|
|
|
|
|
|
|
||||||||
Corporate notes and obligations
|
—
|
|
|
361.4
|
|
|
—
|
|
|
361.4
|
|
||||
U.S. Treasury securities
|
—
|
|
|
235.8
|
|
|
—
|
|
|
235.8
|
|
||||
Asset backed securities
|
—
|
|
|
83.6
|
|
|
—
|
|
|
83.6
|
|
||||
Commercial paper
|
—
|
|
|
40.0
|
|
|
—
|
|
|
40.0
|
|
||||
U.S. agency obligations
|
—
|
|
|
27.9
|
|
|
—
|
|
|
27.9
|
|
||||
Certificates of deposit
|
—
|
|
|
26.0
|
|
|
—
|
|
|
26.0
|
|
||||
Municipal securities
|
—
|
|
|
6.0
|
|
|
—
|
|
|
6.0
|
|
||||
Foreign government obligations
|
—
|
|
|
2.8
|
|
|
—
|
|
|
2.8
|
|
||||
Total short-term investments
|
—
|
|
|
783.5
|
|
|
—
|
|
|
783.5
|
|
||||
Total
|
$
|
241.5
|
|
|
$
|
787.6
|
|
|
$
|
—
|
|
|
$
|
1,029.1
|
|
|
As of December 31, 2019
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
444.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
444.3
|
|
Commercial paper
|
—
|
|
|
2.0
|
|
|
—
|
|
|
2.0
|
|
||||
Total Cash Equivalents
|
$
|
444.3
|
|
|
$
|
2.0
|
|
|
$
|
—
|
|
|
$
|
446.3
|
|
Short-term investments
|
|
|
|
|
|
|
|
||||||||
Corporate notes and obligations
|
—
|
|
|
286.6
|
|
|
—
|
|
|
286.6
|
|
||||
U.S. Treasury securities
|
—
|
|
|
171.3
|
|
|
—
|
|
|
171.3
|
|
||||
Asset-backed securities
|
—
|
|
|
53.8
|
|
|
—
|
|
|
53.8
|
|
||||
Certificates of deposit
|
—
|
|
|
38.2
|
|
|
—
|
|
|
38.2
|
|
||||
U.S. agency obligations
|
—
|
|
|
27.2
|
|
|
—
|
|
|
27.2
|
|
||||
Commercial paper
|
—
|
|
|
24.2
|
|
|
—
|
|
|
24.2
|
|
||||
Supranational securities
|
—
|
|
|
4.0
|
|
|
—
|
|
|
4.0
|
|
||||
Municipal securities
|
—
|
|
|
2.4
|
|
|
—
|
|
|
2.4
|
|
||||
Total short-term investments
|
—
|
|
|
607.7
|
|
|
—
|
|
|
607.7
|
|
||||
Equity investments
|
9.8
|
|
|
—
|
|
|
—
|
|
|
9.8
|
|
||||
Total
|
$
|
454.1
|
|
|
$
|
609.7
|
|
|
$
|
—
|
|
|
$
|
1,063.8
|
|
Note 4.
|
Property and Equipment, Net
|
|
As of
|
||||||
|
June 30, 2020
|
|
December 31, 2019
|
||||
|
|
|
|
||||
Datacenter and other computer equipment
|
$
|
806.0
|
|
|
$
|
749.3
|
|
Furniture and fixtures
|
39.6
|
|
|
35.5
|
|
||
Leasehold improvements
|
240.0
|
|
|
211.4
|
|
||
Construction in progress
|
46.2
|
|
|
36.3
|
|
||
Total property and equipment
|
1,131.8
|
|
|
1,032.5
|
|
||
Accumulated depreciation and amortization
|
(656.2
|
)
|
|
(587.2
|
)
|
||
Property and equipment, net
|
$
|
475.6
|
|
|
$
|
445.3
|
|
Note 5.
|
Business Combinations
|
|
Purchase consideration
|
||
Cash paid to common and preferred stockholders and vested option holders
|
$
|
175.2
|
|
Transaction costs paid by Dropbox on behalf of HelloSign
|
2.4
|
|
|
Fair value of assumed HelloSign options attributable to pre-combination services(1)
|
0.8
|
|
|
Purchase price adjustments
|
(0.5
|
)
|
|
Total purchase consideration
|
$
|
177.9
|
|
Assets acquired:
|
|
||
Cash and cash equivalents
|
$
|
5.5
|
|
Short-term investments
|
7.8
|
|
|
Acquisition-related intangible assets
|
44.6
|
|
|
Accounts receivable, prepaid and other assets
|
5.0
|
|
|
Total assets acquired
|
$
|
62.9
|
|
|
|
||
Liabilities assumed:
|
|
||
Accounts payable, accrued and other liabilities
|
$
|
6.3
|
|
Deferred revenue
|
4.8
|
|
|
Deferred tax liability
|
6.9
|
|
|
Total liabilities assumed
|
18.0
|
|
|
Net assets acquired, excluding goodwill
|
44.9
|
|
|
Total purchase consideration
|
177.9
|
|
|
Goodwill(2)
|
$
|
133.0
|
|
|
Estimated fair values
|
|
Estimated weighted average useful lives
(In years)
|
||
Customer relationships
|
$
|
20.5
|
|
|
4.9
|
Developed technology
|
19.6
|
|
|
5.0
|
|
Trade name
|
4.5
|
|
|
5.0
|
|
Total acquisition-related intangible assets
|
$
|
44.6
|
|
|
|
Note 6.
|
Intangible Assets
|
|
As of June 30,
|
|
As of December 31,
|
|
Weighted-
average remaining useful life (In years) |
||||
|
2020
|
|
2019
|
|
|||||
Developed technology
|
$
|
25.8
|
|
|
$
|
25.8
|
|
|
3.6
|
Customer relationships
|
20.5
|
|
|
20.5
|
|
|
3.7
|
||
Software
|
20.2
|
|
|
20.0
|
|
|
1.4
|
||
Patents
|
13.0
|
|
|
13.0
|
|
|
7.4
|
||
Assembled workforce in asset acquisitions
|
12.6
|
|
|
12.6
|
|
|
0.5
|
||
Trademarks and trade names
|
5.2
|
|
|
5.2
|
|
|
3.6
|
||
Licenses
|
4.6
|
|
|
4.6
|
|
|
1.0
|
||
Other
|
3.3
|
|
|
3.3
|
|
|
5.1
|
||
Total intangibles
|
105.2
|
|
|
105.0
|
|
|
|
||
Accumulated amortization
|
(64.7
|
)
|
|
(57.6
|
)
|
|
|
||
Intangible assets, net
|
$
|
40.5
|
|
|
$
|
47.4
|
|
|
|
|
|
||
Remaining six months of Fiscal 2020
|
$
|
7.0
|
|
2021
|
11.6
|
|
|
2022
|
8.3
|
|
|
2023
|
7.5
|
|
|
2024
|
3.4
|
|
|
Thereafter
|
2.7
|
|
|
Total
|
$
|
40.5
|
|
Note 7.
|
Goodwill
|
Balance at December 31, 2019
|
$
|
234.5
|
|
Effect of foreign currency translation
|
0.2
|
|
|
Balance at June 30, 2020
|
$
|
234.7
|
|
Note 8.
|
Revolving Credit Facility
|
Note 9.
|
Leases
|
Year ending December 31,
|
Operating leases(1)
|
|
Finance leases
|
||||
2020 (excluding the six months ended June 30, 2020)
|
$
|
63.3
|
|
|
$
|
47.5
|
|
2021
|
120.3
|
|
|
85.8
|
|
||
2022
|
112.2
|
|
|
71.7
|
|
||
2023
|
95.6
|
|
|
38.1
|
|
||
2024
|
84.5
|
|
|
5.4
|
|
||
Thereafter
|
644.3
|
|
|
—
|
|
||
Total future minimum lease payments
|
1,120.2
|
|
|
248.5
|
|
||
Less imputed interest
|
(251.6
|
)
|
|
(12.6
|
)
|
||
Less tenant improvement receivables
|
(14.7
|
)
|
|
—
|
|
||
Total liability
|
$
|
853.9
|
|
|
$
|
235.9
|
|
Note 10.
|
Commitments and Contingencies
|
Note 11.
|
Accrued and Other Current Liabilities
|
|
As of
|
||||||
|
June 30, 2020
|
|
December 31, 2019
|
||||
|
|
|
|
||||
Non-income taxes payable
|
$
|
87.9
|
|
|
$
|
92.2
|
|
Accrued legal and other external fees
|
18.7
|
|
|
29.2
|
|
||
Other accrued and current liabilities
|
27.9
|
|
|
40.5
|
|
||
Total accrued and other current liabilities
|
$
|
134.5
|
|
|
$
|
161.9
|
|
Note 12.
|
Stockholders’ Equity
|
|
|
|
Options outstanding
|
|
Restricted stock
outstanding
|
||||||||||||||||||
|
Number of
shares
available for
issuance
under the
Plans
|
|
Number of
shares
outstanding
under the
Plans
|
|
Weighted-
average
exercise
price
per share
|
|
Weighted-
average
remaining
contractual
term
(In years)
|
|
Aggregate intrinsic value
|
|
Number of
shares
outstanding under the Plans
|
|
Weighted-
average
grant date
fair value
per share
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance at December 31, 2019
|
66.2
|
|
|
2.0
|
|
|
$
|
12.28
|
|
|
6.5
|
|
|
$
|
16.40
|
|
|
30.7
|
|
|
$
|
20.48
|
|
Additional shares authorized
|
21.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Options exercised and RSUs released
|
—
|
|
|
(0.3
|
)
|
|
4.77
|
|
|
—
|
|
|
—
|
|
|
(6.1
|
)
|
|
20.01
|
|
|||
Options and RSUs canceled
|
5.9
|
|
|
(0.2
|
)
|
|
17.40
|
|
|
—
|
|
|
—
|
|
|
(5.8
|
)
|
|
20.25
|
|
|||
Shares repurchased for tax withholdings on release of restricted stock units and awards
|
2.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20.00
|
|
|||
Restricted stock and options granted
|
(20.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20.8
|
|
|
18.64
|
|
|||
Balance at June 30, 2020
|
75.2
|
|
|
1.5
|
|
|
$
|
13.37
|
|
|
6.2
|
|
|
$
|
12.70
|
|
|
39.6
|
|
|
$
|
19.62
|
|
Vested at June 30, 2020
|
|
|
1.0
|
|
|
$
|
16.47
|
|
|
5.5
|
|
|
$
|
6.30
|
|
|
—
|
|
|
$
|
—
|
|
|
Unvested at June 30, 2020
|
|
|
0.5
|
|
|
$
|
5.55
|
|
|
|
|
$
|
6.40
|
|
|
39.6
|
|
|
$
|
19.62
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Intrinsic value of options exercised
|
$
|
3.0
|
|
|
$
|
1.4
|
|
|
$
|
4.8
|
|
|
$
|
4.5
|
|
Expected volatility
|
51.6
|
%
|
Expected term (in years)
|
3.4 - 7.0
|
|
Risk-free interest rate
|
2.42% - 2.51%
|
|
Dividend yield
|
—
|
%
|
Note 13.
|
Net Income (Loss) Per Share
|
|
Three months ended June 30,
|
Three months ended June 30,
|
|||||||||||||
|
2020
|
|
2019
|
||||||||||||
|
Class A
|
|
Class B
|
|
Class A
|
|
Class B
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Basic net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to common stockholders
|
$
|
11.9
|
|
|
$
|
5.6
|
|
|
$
|
(12.0
|
)
|
|
$
|
(9.4
|
)
|
Denominator
|
|
|
|
|
|
|
|
||||||||
Weighted-average number of common shares outstanding used in computing basic net income (loss) per share
|
281.5
|
|
|
132.7
|
|
|
231.1
|
|
|
181.3
|
|
||||
Net income (loss) per common share, basic
|
$
|
0.04
|
|
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.05
|
)
|
Diluted net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to common stockholders
|
$
|
11.9
|
|
|
$
|
5.6
|
|
|
$
|
(12.0
|
)
|
|
$
|
(9.4
|
)
|
Reallocation of net income as a result of conversion of Class B to Class A common stock
|
$
|
5.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Reallocation of net income to Class B common stock
|
—
|
|
|
$
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|||
Net income (loss) attributable to common stockholders for diluted EPS
|
$
|
17.5
|
|
|
$
|
5.5
|
|
|
$
|
(12.0
|
)
|
|
$
|
(9.4
|
)
|
Denominator
|
|
|
|
|
|
|
|
||||||||
Weighted-average number of common shares outstanding used in computing basic net income (loss) per share
|
281.5
|
|
|
132.7
|
|
|
231.1
|
|
|
181.3
|
|
||||
Weighted-average effect of dilutive RSUs and employee stock options
|
6.0
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
||||
Conversion of Class B to Class A common stock
|
132.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Weighted-average number of common shares outstanding used in computed diluted net income (loss) per share
|
420.2
|
|
|
133.0
|
|
|
231.1
|
|
|
181.3
|
|
||||
Net income (loss) per common share, diluted
|
$
|
0.04
|
|
|
$
|
0.04
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.05
|
)
|
|
Six months ended June 30,
|
Six months ended June 30,
|
|||||||||||||
|
2020
|
|
2019
|
||||||||||||
|
Class A
|
|
Class B
|
|
Class A
|
|
Class B
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Basic net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to common stockholders
|
$
|
37.0
|
|
|
$
|
19.8
|
|
|
$
|
(15.8
|
)
|
|
$
|
(13.3
|
)
|
Denominator
|
|
|
|
|
|
|
|
||||||||
Weighted-average number of common shares outstanding used in computing basic net income (loss) per share
|
270.7
|
|
|
145.0
|
|
|
223.2
|
|
|
188.3
|
|
||||
Net income (loss) per common share, basic
|
$
|
0.14
|
|
|
$
|
0.14
|
|
|
$
|
(0.07
|
)
|
|
$
|
(0.07
|
)
|
Diluted net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to common stockholders
|
$
|
37.0
|
|
|
$
|
19.8
|
|
|
$
|
(15.8
|
)
|
|
$
|
(13.3
|
)
|
Reallocation of net income as a result of conversion of Class B to Class A common stock
|
$
|
19.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Reallocation of net income to Class B common stock
|
—
|
|
|
$
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|||
Net income (loss) attributable to common stockholders for diluted EPS
|
$
|
56.8
|
|
|
$
|
19.7
|
|
|
$
|
(15.8
|
)
|
|
$
|
(13.3
|
)
|
Denominator
|
|
|
|
|
|
|
|
||||||||
Weighted-average number of common shares outstanding used in computing basic net income (loss) per share
|
270.7
|
|
|
145.0
|
|
|
223.2
|
|
|
188.3
|
|
||||
Weighted-average effect of dilutive RSUs and employee stock options
|
3.6
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
||||
Conversion of Class B to Class A common stock
|
145.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Weighted-average number of common shares outstanding used in computed diluted net income (loss) per share
|
419.3
|
|
|
145.3
|
|
|
223.2
|
|
|
188.3
|
|
||||
Net income (loss) per common share, diluted
|
$
|
0.14
|
|
|
$
|
0.14
|
|
|
$
|
(0.07
|
)
|
|
$
|
(0.07
|
)
|
|
Three months ended
June 30, |
|
Six months ended June 30,
|
||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||
|
|
|
|
|
|
|
|
||||
Restricted stock units
|
9.4
|
|
|
31.3
|
|
|
11.1
|
|
|
28.0
|
|
Options to purchase shares of common stock
|
0.8
|
|
|
2.1
|
|
|
0.9
|
|
|
1.9
|
|
Co-Founder Grants
|
10.3
|
|
|
14.7
|
|
|
12.2
|
|
|
14.7
|
|
Total
|
20.5
|
|
|
48.1
|
|
|
24.2
|
|
|
44.6
|
|
Note 14.
|
Income Taxes
|
Note 15.
|
Geographic Areas
|
|
As of
|
||||||
|
June 30, 2020
|
|
December 31, 2019
|
||||
|
—
|
|
|
|
|||
United States
|
$
|
464.7
|
|
|
$
|
431.9
|
|
International(1)
|
10.9
|
|
|
13.4
|
|
||
Total property and equipment, net
|
$
|
475.6
|
|
|
$
|
445.3
|
|
|
Three months ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
244.6
|
|
|
$
|
205.5
|
|
|
$
|
480.2
|
|
|
$
|
402.6
|
|
International(1)
|
222.8
|
|
|
196.0
|
|
|
442.2
|
|
|
384.5
|
|
||||
Total revenue
|
$
|
467.4
|
|
|
$
|
401.5
|
|
|
$
|
922.4
|
|
|
$
|
787.1
|
|
|
As of
|
||||
|
June 30, 2020
|
|
December 31, 2019
|
|
June 30, 2019
|
|
|
|
|
|
|
|
(In millions)
|
||||
Total ARR
|
$1,931
|
|
$1,820
|
|
$1,651
|
|
As of
|
||||
Constant Currency
|
June 30, 2020
|
|
December 31, 2019
|
|
June 30, 2019
|
|
|
|
|
|
|
|
(In millions)
|
||||
Total ARR
|
$1,931
|
|
$1,811
|
|
$1,643
|
|
As of
|
|||||||
|
June 30, 2020
|
|
December 31, 2019
|
|
June 30, 2019
|
|||
|
|
|
|
|
|
|||
|
(In millions)
|
|||||||
Paying users
|
15.0
|
|
|
14.3
|
|
|
13.6
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
ARPU
|
$
|
126.88
|
|
|
$
|
120.48
|
|
|
$
|
126.41
|
|
|
$
|
120.83
|
|
|
Six Months Ended
June 30, |
||||||
|
2020
|
|
2019
|
||||
|
|
|
|
||||
|
(In millions)
|
||||||
Net cash provided by operating activities
|
199.2
|
|
|
192.0
|
|
||
Capital expenditures
|
(53.9
|
)
|
|
(63.4
|
)
|
||
Free cash flow
|
$
|
145.3
|
|
|
$
|
128.6
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Revenue
|
$
|
467.4
|
|
|
$
|
401.5
|
|
|
$
|
922.4
|
|
|
$
|
787.1
|
|
Cost of revenue(1)
|
102.5
|
|
|
102.9
|
|
|
205.6
|
|
|
201.3
|
|
||||
Gross profit
|
364.9
|
|
|
298.6
|
|
|
716.8
|
|
|
585.8
|
|
||||
Operating expenses(1):
|
|
|
|
|
|
|
|
||||||||
Research and development
|
185.8
|
|
|
162.4
|
|
|
367.6
|
|
|
312.4
|
|
||||
Sales and marketing
|
102.8
|
|
|
107.3
|
|
|
207.1
|
|
|
208.8
|
|
||||
General and administrative
|
63.5
|
|
|
62.9
|
|
|
102.5
|
|
|
119.9
|
|
||||
Total operating expenses
|
352.1
|
|
|
332.6
|
|
|
677.2
|
|
|
641.1
|
|
||||
Income (loss) from operations
|
12.8
|
|
|
(34.0
|
)
|
|
39.6
|
|
|
(55.3
|
)
|
||||
Interest income, net
|
0.1
|
|
|
3.2
|
|
|
2.5
|
|
|
6.9
|
|
||||
Other income, net
|
9.0
|
|
|
10.0
|
|
|
19.6
|
|
|
14.2
|
|
||||
Income (loss) before income taxes
|
21.9
|
|
|
(20.8
|
)
|
|
61.7
|
|
|
(34.2
|
)
|
||||
Benefit from (provision for) income taxes
|
(4.4
|
)
|
|
(0.6
|
)
|
|
(4.9
|
)
|
|
5.1
|
|
||||
Net income (loss)
|
$
|
17.5
|
|
|
$
|
(21.4
|
)
|
|
$
|
56.8
|
|
|
$
|
(29.1
|
)
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
(In millions)
|
||||||||||||||
Cost of revenue
|
$
|
4.5
|
|
|
$
|
4.7
|
|
|
$
|
8.0
|
|
|
$
|
7.7
|
|
Research and development
|
47.0
|
|
|
37.7
|
|
|
84.2
|
|
|
68.2
|
|
||||
Sales and marketing
|
9.5
|
|
|
8.8
|
|
|
16.2
|
|
|
15.9
|
|
||||
General and administrative(2)
|
15.6
|
|
|
16.9
|
|
|
8.0
|
|
|
31.9
|
|
||||
Total stock-based compensation
|
$
|
76.6
|
|
|
$
|
68.1
|
|
|
$
|
116.4
|
|
|
$
|
123.7
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||
|
|
|
|
|
|
|
|
||||
|
(As a % of revenue)
|
||||||||||
Cost of revenue
|
1
|
%
|
|
1
|
%
|
|
1
|
%
|
|
1
|
%
|
Research and development
|
10
|
|
|
9
|
|
|
9
|
|
|
9
|
|
Sales and marketing
|
2
|
|
|
2
|
|
|
2
|
|
|
2
|
|
General and administrative(2)
|
3
|
|
|
4
|
|
|
1
|
|
|
4
|
|
Total stock-based compensation
|
16
|
%
|
|
17
|
%
|
|
13
|
%
|
|
16
|
%
|
|
Three Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
Revenue
|
$
|
467.4
|
|
|
$
|
401.5
|
|
|
$
|
65.9
|
|
|
16
|
%
|
|
Three Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
Research and development
|
$
|
185.8
|
|
|
$
|
162.4
|
|
|
$
|
23.4
|
|
|
14
|
%
|
|
Three Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
Sales and marketing
|
$
|
102.8
|
|
|
$
|
107.3
|
|
|
$
|
(4.5
|
)
|
|
(4
|
)%
|
|
Three Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
General and administrative
|
$
|
63.5
|
|
|
$
|
62.9
|
|
|
$
|
0.6
|
|
|
1
|
%
|
|
Six Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
Revenue
|
$
|
922.4
|
|
|
$
|
787.1
|
|
|
$
|
135.3
|
|
|
17
|
%
|
|
Six Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
Research and development
|
$
|
367.6
|
|
|
$
|
312.4
|
|
|
$
|
55.2
|
|
|
18
|
%
|
|
Six Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
Sales and marketing
|
$
|
207.1
|
|
|
$
|
208.8
|
|
|
$
|
(1.7
|
)
|
|
(1
|
)%
|
|
Six Months Ended
June 30, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|||||||
|
(In millions)
|
|
|
|
|
|||||||||
General and administrative
|
$
|
102.5
|
|
|
$
|
119.9
|
|
|
$
|
(17.4
|
)
|
|
(15
|
)%
|
|
Six months ended June 30,
|
||||||
|
2020
|
|
2019
|
||||
|
|
|
|
||||
|
(In millions)
|
||||||
Net cash provided by operating activities
|
$
|
199.2
|
|
|
$
|
192.0
|
|
Net cash used in investing activities
|
(189.6
|
)
|
|
(270.5
|
)
|
||
Net cash used in financing activities
|
(226.2
|
)
|
|
(97.4
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
(0.6
|
)
|
|
0.2
|
|
||
Net (decrease) increase in cash and cash equivalents
|
$
|
(217.2
|
)
|
|
$
|
(175.7
|
)
|
•
|
user-centric design;
|
•
|
ease of adoption and use;
|
•
|
scale of user network;
|
•
|
features and platform experience
|
•
|
performance;
|
•
|
brand;
|
•
|
security and privacy
|
•
|
accessibility across several devices, operating system, and applications;
|
•
|
third-party integration;
|
•
|
customer support;
|
•
|
continued innovation; and
|
•
|
pricing.
|
•
|
awareness of the content collaboration category generally;
|
•
|
availability of products and services that compete with ours;
|
•
|
ease of adoption and use;
|
•
|
features and platform experience;
|
•
|
performance;
|
•
|
brand;
|
•
|
security and privacy;
|
•
|
customer support; and
|
•
|
pricing.
|
•
|
our ability to retain and upgrade paying users;
|
•
|
our ability to attract new paying users and convert registered to paying users;
|
•
|
the timing of expenses and recognition of revenue;
|
•
|
the amount and timing of operating expenses related to the maintenance and expansion of our business, operations, and infrastructure, as well as entry into operating and finance leases;
|
•
|
the timing of expenses related to acquisitions;
|
•
|
any large indemnification payments to our users or other third parties;
|
•
|
changes in our pricing policies or those of our competitors;
|
•
|
the timing and success of new product feature and service introductions by us or our competitors;
|
•
|
network outages or actual or perceived security breaches;
|
•
|
changes in the competitive dynamics of our industry, including consolidation among competitors;
|
•
|
changes in laws and regulations that impact our business;
|
•
|
general economic and market conditions; and
|
•
|
catastrophic events, including earthquakes, fires, floods, tsunamis, or other weather events, power loss, telecommunications failures, software or hardware malfunctions, cyber-attack, war, or terrorist attacks, and pandemics such the ongoing COVID-19 pandemic.
|
•
|
compliance with applicable international laws and regulations, including laws and regulations with respect to privacy, data protection, consumer protection, and unsolicited email, and the risk of penalties to our users and individual members of management or employees if our practices are deemed to be out of compliance;
|
•
|
recruiting and retaining talented and capable employees outside the United States, and maintaining our company culture across all of our offices;
|
•
|
providing our platform and operating our business across a significant distance, in different languages and among different cultures, including the potential need to modify our platform and features to ensure that they are culturally appropriate and relevant in different countries;
|
•
|
management of an employee base in jurisdictions that may not give us the same employment and retention flexibility as does the United States;
|
•
|
operating in jurisdictions that do not protect intellectual property rights to the same extent as does the United States;
|
•
|
compliance by us and our business partners with anti-corruption laws, import and export control laws, tariffs, trade barriers, economic sanctions, and other regulatory limitations on our ability to provide our platform in certain international markets;
|
•
|
foreign exchange controls that might require significant lead time in setting up operations in certain geographic territories and might prevent us from repatriating cash earned outside the United States;
|
•
|
political and economic instability;
|
•
|
changes in diplomatic and trade relationships, including the imposition of new trade restrictions, trade protection measures, import or export requirements, trade embargoes and other trade barriers;
|
•
|
double taxation of our international earnings and potentially adverse tax consequences due to changes in the income and other tax laws of the United States or the international jurisdictions in which we operate;
|
•
|
higher costs of doing business internationally, including increased accounting, travel, infrastructure, and legal compliance costs; and
|
•
|
the impact of natural disasters and public health epidemics on employees, travel and the global economy, including the ongoing global COVID-19 pandemic.
|
•
|
implement usage-based pricing;
|
•
|
discount pricing for competitive products;
|
•
|
otherwise materially change their pricing rates or schemes;
|
•
|
charge us to deliver our traffic at certain levels or at all;
|
•
|
throttle traffic based on its source or type;
|
•
|
implement bandwidth caps or other usage restrictions; or
|
•
|
otherwise try to monetize or control access to their networks.
|
•
|
cause a reduction in revenue or delay in market acceptance of our platform;
|
•
|
require us to issue refunds to our users or expose us to claims for damages;
|
•
|
cause us to lose existing users and make it more difficult to attract new users;
|
•
|
divert our development resources or require us to make extensive changes to our platform, which would increase our expenses;
|
•
|
increase our technical support costs; and
|
•
|
harm our reputation and brand.
|
•
|
acquisition-related costs, liabilities, or tax impacts, some of which may be unanticipated;
|
•
|
difficulty integrating and retaining the personnel, intellectual property, technology infrastructure, and operations of an acquired business;
|
•
|
ineffective or inadequate, controls, procedures, or policies at an acquired business;
|
•
|
multiple product lines or services offerings, as a result of our acquisitions, that are offered, priced, and supported differently;
|
•
|
potential unknown liabilities or risks associated with an acquired business, including those arising from existing contractual obligations or litigation matters;
|
•
|
inability to maintain relationships with key customers, suppliers, and partners of an acquired business;
|
•
|
lack of experience in new markets, products or technologies;
|
•
|
diversion of management's attention from other business concerns; and
|
•
|
use of resources that are needed in other parts of our business.
|
•
|
require repayment of any outstanding lease obligations;
|
•
|
terminate our leasing arrangements;
|
•
|
terminate our access to the leased datacenters we utilize;
|
•
|
stop delivery of ordered equipment;
|
•
|
sell or require us to return our leased equipment;
|
•
|
require repayment of any outstanding amounts drawn on our revolving credit facility;
|
•
|
terminate our revolving credit facility; or
|
•
|
require us to pay significant fees, penalties, or damages.
|
•
|
price and volume fluctuations in the overall stock market from time to time;
|
•
|
volatility in the trading prices and trading volumes of technology stocks;
|
•
|
changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular;
|
•
|
sales of shares of our Class A common stock by us or our stockholders;
|
•
|
failure of securities analysts to maintain coverage of us, changes in financial estimates by securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors;
|
•
|
the financial projections we may provide to the public, any changes in those projections, or our failure to meet those projections;
|
•
|
announcements by us or our competitors of new products, features, or services;
|
•
|
the public’s reaction to our press releases, other public announcements, and filings with the SEC;
|
•
|
rumors and market speculation involving us or other companies in our industry;
|
•
|
actual or anticipated changes in our results of operations or fluctuations in our results of operations;
|
•
|
actual or anticipated developments in our business, our competitors’ businesses or the competitive landscape generally;
|
•
|
litigation involving us, our industry, or both, or investigations by regulators into our operations or those of our competitors;
|
•
|
developments or disputes concerning our intellectual property or other proprietary rights;
|
•
|
announced or completed acquisitions of businesses, products, services, or technologies by us or our competitors;
|
•
|
new laws or regulations or new interpretations of existing laws or regulations applicable to our business;
|
•
|
changes in accounting standards, policies, guidelines, interpretations, or principles;
|
•
|
any significant change in our management;
|
•
|
general economic conditions and slow or negative growth of our markets; and
|
•
|
catastrophic events, including earthquakes, fires, floods, tsunamis, or other weather events, power loss, telecommunications failures, software or hardware malfunctions, cyber-attack, war, or terrorist attacks, and pandemics such the ongoing COVID-19 pandemic.
|
•
|
any transaction that would result in a change in control of our company requires the approval of a majority of our outstanding Class B common stock voting as a separate class;
|
•
|
our multi-class common stock structure, which provides our holders of Class B common stock with the ability to significantly influence the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the shares of our outstanding Class A common stock, Class B common stock, and Class C common stock;
|
•
|
when the outstanding shares of Class B common stock represent less than a majority of the total combined voting power of our Class A and Class B common stock, or the Voting Threshold Date, our Board of Directors will be classified into three classes of directors with staggered three-year terms, and directors will only be able to be removed from office for cause;
|
•
|
until the Class B common stock, as a class, converts to Class A common stock, any amendments to our restated certificate of incorporation will require the approval of two-thirds of the combined vote of our then-outstanding shares of Class A common stock and Class B common stock; and following the conversion of our Class B common stock, as a class, to Class A common stock, certain amendments to our amended and restated certificate of incorporation will require the approval of two-thirds of our then outstanding voting power;
|
•
|
our amended and restated bylaws will provide that approval of stockholders holding two-thirds of our outstanding voting power voting as a single class is required for stockholders to amend or adopt any provision of our bylaws;
|
•
|
after the Voting Threshold Date our stockholders will only be able to take action at a meeting of stockholders, and will not be able to take action by written consent for any matter;
|
•
|
until the Voting Threshold Date, our stockholders will be able to act by written consent only if the action is first recommended or approved by the Board of Directors;
|
•
|
vacancies on our Board of Directors will be able to be filled only by our Board of Directors and not by stockholders;
|
•
|
only the chairman of our Board of Directors, our chief executive officer, a majority of our Board of Directors or until the Class B common stock, as a class, converts to Class A common stock, a stockholder holding thirty percent of the combined voting power of our Class A and Class B common stock are authorized to call a special meeting of stockholders;
|
•
|
certain litigation against us may be required to be brought in Delaware;
|
•
|
our restated certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established and shares of which may be issued, without the approval of the holders of Class A common stock; and
|
•
|
advance notice procedures apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders.
|
Period
|
|
Total Number of Shares Purchased (in millions)(1)
|
|
Average Price Paid per Share(2)
|
|
Total Number of Shares Purchased as Part of Publicly Announced Programs
(in millions)(1)
|
|
Approximate Dollar Value of Shares that May Yet Be Purchased Under Publicly Announced Programs
(in millions)(1)
|
||||||
April 1 - 30
|
|
1.95
|
|
|
$
|
19.05
|
|
|
1.95
|
|
|
$
|
498.89
|
|
May 1 - 31
|
|
1.21 (3)
|
|
|
$
|
21.50
|
|
|
1.20
|
|
|
$
|
473.08
|
|
June 1 - 30
|
|
0.58
|
|
|
$
|
22.37
|
|
|
0.58
|
|
|
$
|
460.19
|
|
Total
|
|
3.74
|
|
|
$
|
20.35
|
|
|
3.73
|
|
|
|
||
|
|
|
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Form
|
|
File Number
|
|
Incorporated by Reference from Exhibit Number
|
|
Filed with SEC
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.1 +
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32.1†
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
104
|
|
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DROPBOX, INC.
|
||
|
|
|
|
|
Date:
|
August 7, 2020
|
By:
|
|
/s/ Andrew W. Houston
|
|
|
|
|
Andrew W. Houston
|
|
|
|
|
Chief Executive Officer
|
|
|
|
|
(Principal Executive Officer)
|
Date:
|
August 7, 2020
|
By:
|
|
/s/ Ajay V. Vashee
|
|
|
|
|
Ajay V. Vashee
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
(Principal Financial Officer)
|
Date:
|
August 7, 2020
|
By:
|
|
/s/ Timothy J. Regan
|
|
|
|
|
Timothy J. Regan
|
|
|
|
|
Chief Accounting Officer
|
|
|
|
|
(Principal Accounting Officer)
|
•
|
2,400,000,000 shares are designated as Class A common stock;
|
•
|
475,000,000 shares are designated as Class B common stock;
|
•
|
800,000,000 shares are designated as Class C common stock; and
|
•
|
240,000,000 shares are designated as preferred stock.
|
•
|
if we were to seek to amend our amended and restated certificate of incorporation to increase or decrease the par value of a class of stock, then that class would be required to vote separately to approve the proposed amendment; and
|
•
|
if we were to seek to amend our amended and restated certificate of incorporation in a manner that alters or changes the powers, preferences, or special rights of a class of stock in a manner that affected its holders adversely, then that class would be required to vote separately to approve the proposed amendment.
|
•
|
amend or modify any provision of the amended and restated certificate of incorporation inconsistent with, or otherwise alter, any provision of amended and restated certificate of incorporation to modify the voting, conversion or other rights, powers, preferences, privileges or restrictions of the Class B common stock;
|
•
|
reclassify any outstanding shares of Class A common stock or Class C common stock into shares having rights as to dividends or liquidation that are senior to the Class B common stock or, in the case of Class A common stock, the right
|
•
|
subject to certain exceptions, issue any shares of Class B common stock;
|
•
|
authorize, or issue any shares of, any class or series of capital stock of the Company having the right to more than one vote for each share thereof; or
|
•
|
consummate a Liquidation Event (as defined in the amended and restated certificate of incorporation).
|
•
|
the transaction was approved by the board of directors prior to the time that the stockholder became an interested stockholder;
|
•
|
upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding shares owned by directors who are also officers of the corporation and shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
at or subsequent to the time the stockholder became an interested stockholder, the business combination was approved by the board of directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder.
|
1.
|
Base Salary. Effective on September 15, 2020, your annualized base salary will be adjusted to $450,000 per year, less applicable taxes and withholdings, paid in accordance with Dropbox’s normal payroll procedures. Your base salary will be subject to review and adjustment based upon the Company’s normal performance review practices.
|
2.
|
Annual Bonus. You will continue to be eligible to receive an annual bonus, and the new target amount will be 65% of your base salary, contingent upon you achieving performance objectives established by the Dropbox Board of Directors or its authorized committee (collectively the “Committee) in its sole discretion and payable upon achievement of those objectives as determined by the Committee. If any portion of such bonus is earned, it will be paid when practicable after the Committee determines it has been earned. Your annual bonus opportunity will be subject to review and adjustment based upon the Company’s normal performance review practices. No bonus will be earned or received unless you’re still employed by Dropbox on the bonus payment date.
|
3.
|
Equity. We will recommend to the Dropbox Board of Directors (or its delegate) that you be granted additional restricted stock (“RSAs”) with an approximate current value of $4,000,000.00 under Dropbox’s equity incentive plan, with the number of shares granted to be determined by the average closing price of Dropbox common stock for the prior month (the “Grant”). The Grant will be subject to the terms of Dropbox’s Equity Award Grant Policy, equity incentive plan, and the Restricted Stock Award Agreement between you and Dropbox. This Grant is further subject to the Board’s approval and the promise to recommend the approval does not create an obligation for Dropbox to issue any equity grant to you. Further details on the equity plan and any specific grant will be provided upon the Board’s (or its delegate’s) approval of the Grant.
|
4.
|
Employee Benefits. You and your family members will continue to be eligible to participate in Dropbox’s standard employee benefits plans as they are provided to San Francisco, California employees to the extent that you meet their eligibility criteria. This Section 4 does not create any obligation on the part of Dropbox to adopt or maintain any employee benefit plan or program at any time. Dropbox may amend or terminate, any employee benefit plan or program at any time.
|
5.
|
Severance. You will be eligible to enter into a Change in Control and Severance Agreement (the “Severance Agreement”) applicable to you based on your position within the Company. The Severance Agreement will specify the severance payments and benefits you would be eligible to receive in connection
|
6.
|
Confidentiality Agreement. As an employee of the Company, you will continue to have access to certain confidential information of the Company and you may, during the course of your employment, develop certain information or inventions that will be the property of the Company. To protect the interests of the Company, your acceptance of this Agreement confirms that the terms of the Company’s Employee Invention Assignment and Confidentiality Agreement you previously signed with the Company (the “EIACA”) still apply.
|
7.
|
Commitment to Company. During your employment with the Company, you will continue to perform your duties faithfully and to the best of your ability and you will devote your full business efforts and time to the Company. Except as specifically approved by the Committee, you agree that, during the term of your employment with the Company, you will not (i) engage in any other employment, occupation, consulting, business or other activity related to the business in which the Company or any of its subsidiaries or affiliates is now involved, any proposed business of the Company or any of its subsidiaries or affiliates, or any business in which the Company or any of its subsidiaries or affiliates becomes involved during the term of your employment, (ii) assist any other person or organization in competing with the Company or in preparing to engage in competition with the business or proposed business of the Company, or (iii) engage in any other activities that conflict with your obligations to the Company or any of its subsidiaries or affiliates. Similarly, you agree not to bring any third party confidential information to the Company, including that of your former employer, and that in performing your duties for the Company you will not in any way utilize any such information. You will disclose to the Company in writing any other employment, business or activity that you are currently associated with or participate in that competes with the Company.
|
8.
|
Protected Activity Not Prohibited. Nothing in this Agreement or in any other agreement between you or the Company, as applicable, will in any way limit or prohibit you from engaging for a lawful purpose in any Protected Activity. For purposes of this Agreement, “Protected Activity” means filing a charge or complaint, or otherwise communicating, cooperating, or participating with, any state, federal, or other governmental agency, including but not limited to the U.S. Securities and Exchange Commission, the Equal Employment Opportunity Commission, and the National Labor Relations Board. Notwithstanding any restrictions set forth in this Agreement or in any other agreement between you or the Company, as applicable, you understand that you are not required to obtain authorization from the Company prior to disclosing information to, or communicating with, such agencies, nor are you obligated to advise the Company as to any such disclosures or communications. In making any such disclosures or communications, you agree to take all reasonable precautions to prevent any unauthorized use or disclosure of any information that may constitute Confidential Information (within the meaning of the EIACA) to any parties other than the relevant government agencies. You further understand that “Protected Activity” does not include the disclosure of any Company attorney-client privileged communications, and that any such disclosure without the Company’s written consent will constitute a material breach of this Agreement. You acknowledge that the Company has provided you with notice in compliance with the Defend Trade Secrets Act of 2016 regarding immunity from liability for limited disclosures of trade secrets. The full text of the notice is attached in Exhibit A.
|
9.
|
Arbitration (Not applicable to Sexual Harassment or Discrimination Claims). Except as explained in this paragraph, you and Dropbox shall submit to mandatory and exclusive binding arbitration of any
|
10.
|
At-Will Employment. Acceptance of this new role does not alter the at-will nature of your employment with Dropbox which means the employment relationship can be terminated by either you or Dropbox for any reason, at any time, with or without prior notice or cause.
|
/s/ Timothy Regan
Timothy Regan
|
8/4/2020
Date Signed
|
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Dropbox, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(c)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
DROPBOX, INC.
|
|
|
|
|
|
By:
|
/s/ Andrew W. Houston
|
|
Name:
|
Andrew W. Houston
|
|
Title:
|
Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Dropbox, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(c)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
DROPBOX, INC.
|
|
|
|
|
|
By:
|
/s/ Ajay V. Vashee
|
|
Name:
|
Ajay V. Vashee
|
|
Title:
|
Chief Financial Officer
(Principal Financial Officer)
|
Date:
|
August 7, 2020
|
By:
|
/s/ Andrew W. Houston
|
|
|
Name:
|
Andrew W. Houston
|
|
|
Title:
|
Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
Date:
|
August 7, 2020
|
By:
|
/s/ Ajay V. Vashee
|
|
|
Name:
|
Ajay V. Vashee
|
|
|
Title:
|
Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|