EFTA01377692.pdf

S- ILA (In thousands) Provision for income taxes $ — $ 513 $ 1.440 NM 181% Provision for income taxes for the year ended December 31, 2014, increased by $0.9 million, or 181%, compared to the year ended December 31, 2013. Our current provision for income taxes for the year ended December 31, 2014. included state, federal, and foreign expense of $4.1 million offset by a state and federal deferred benefit of $2.7 million. Our provision for income taxes for the year ended December 31, 2013, included state and foreign expense of $0.5 million. No provision was recorded for the year ended December 31, 2012. 86 Table of Contents Quarterly Results of Operations The following tables set forth selected unaudited quarterly statements of operations data for the last eight quarters. The information for each of these quarters has been prepared on the same basis as the audited annual financial statements included elsewhere in this prospectus and, in the opinion of management, includes all adjustments, which consist only of normal recurring adjustments, necessary for the fair presentation of the results of operations for these periods. This data should be read in conjunction with our audited consolidated financial statements and related notes included elsewhere in this prospectus. These quarterly operating results are not necessarily indicative of the results we may achieve in future periods. Three Months Ended, Dee. 31, Mar. 31, Jun. 30, Sep. 30, Dee. 31, Mar. 31, June 30, Sep. 30, 2013 2014 2014 2014 2014 2015 2015 2015 (In thousands) (unaudited) Revenue: Transaction revenue $ 130,978 $ 137,014 $ 172.894 $ 191,560 $ 206,331 $ 211.110 $ 259.864 $ 280.955 Starbucks transaction revenue 33.754 26,466 30.147 29.895 36,516 29.237 33.630 32.332 Software and data product revenue 523 1.766 3.733 6.024 8.006 12.928 14,694 Hardware revenue 1.244 1.079 1.989 2,232 2.023 2.204 3.591 4.207 Total net revenue 165976 165.082 206.796 227.420 250,894 250.557 310.013 332.188 Cost of revenue: Transaction costs 84.833 86.275 109.801 122.425 132.357 132.107 165.823 182.007 Starbucks transaction costs 39.819 33,016 37,496 37.377 43.066 36,211 40,921 41,410 Software and data product costs 14 31 987 1.941 3.155 5.072 5.593 Hardware costs 2.877 3,441 4.924 5.162 4.803 4,197 6.713 5.726 Amortization of acquired technology 80 192 330 400 602 1.142 1.142 Total cost of revenue 127.529 122.826 152.444 166.281 182.567 176.272 219.671 235.878 Gross profit 38,447 42.256 54.352 61.139 68.327 74285 90.342 96.310 Operating expenses: Product development 26.261 30.933 34.551 39.483 39.670 39.545 45.887 55.020 Sales and marketing 16,377 26.070 29.720 25.914 30,873 36.181 31.730 39.259 General and administrative 19.828 23.402 20.669 24.514 25.635 28.119 31.804 37.820 Transaction and advance losses 3.946 6,128 4.840 6.858 6.255 16.322 8,513 16,005 Amortization of acquired customer assets 68 162 361 459 468 482 423 Impairment of intangible assets 2430 Total operating expenses 68.842 86.601 89.942 97.130 102.892 120.635 118.416 148.527 Operating loss (30.395) (44.345) (35.590) (35.991) (34.565) (46.350) (28.074) (52.217) Interest (income) and expense (4) 2 180 433 443 414 444 137 Other (income) and expense (114) 454 (674) 957 367 796 (50) 644 Loss before income tax (30.277) (44.801) (35.096) (37.381) (35.375) (47.560) (28.468) (52.998) Provision (benefit) for income taxes 513 (810) 268 285 1.697 418 1.152 932 Net loss $ (30.790) $ (43.991) $ (35.364) $ (37.666) $ (37.072) $ (47.978) S (29.620) $ (53.930) 87 Table of Contents http://www.sec. gov/A rehi vestedgaddata/1512673ANS1119312515369092/d937622dsla. htm( 11/6/2015 7:37:12 AM CONFIDENTIAL - PURSUANT TO FED. R. GRIM. P. 6(e) DB-SDNY-0074843 CONFIDENTIAL SDNY_GM_00221027 EFTA01377692